Top 5 Agile Methods to Leverage in Procurement7 min read

In nature, cross pollination can yield wonderful new varieties of plants. As bees and other insects buzz between different plant species, magic can happen and a new type of plant is born.

I think this is a great analogy for one of the ways you can bring innovation to your field; that is, getting inspired by methods and tools that work in other fields, applying them to yours when relevant and evaluating the results to see if you’ve got something.

In this spirit, I think there is tremendous potential to “level up” your procurement operations by applying Agile methods to your procurement operations. At its core, Agile methods are centered around improving communication, collaboration, feedback and trust in software development. However, who says we can’t use these tools for our procurement teams?

So here we go, the Top 5 Agile methods for use in Procurement. Most of these work in a Procure-to-Pay setting but all of them apply in a strategic sourcing and contracting setting.

#5 – The “Stand Up” Meeting

One of my favorite Agile tools that transfers well to Procurement is the ‘Stand Up Meeting’. Book a periodic (2-5 times a week), short meeting (15 min max) with your immediate team where each member answers the following 3 questions:

• What was accomplished during the last period
• Accomplishments on the “To Do” in the next period
• What, if any, “blockers” are preventing them from doing their work

A timer is set and a scribe has a calendar/email application open. When action items emerge from the exercise (need for an offline meeting, need to notify someone, new task, etc.), the scribe plans/notes the actions and involves the appropriate people. Once everyone has answered the 3 question the meeting ends and everyone goes about executing their next period and addressing the action items.

No details should be discussed at the meeting. It’s an insurance policy to ensure everyone is spending their time on the appropriate items and to plan activities to course correct as needed.

It takes a while before a team gets the hang of the stand up meeting. The leader and team members need to keep each other honest and on point. By experimenting, you’ll find the right periodicity for maximal value. This might also change over time depending on how busy you are as a team.

#4 – Mood Marbles

Another very easy Agile tool to implement in procurement is the “mood marbles” concept. At its core, this tool is about getting a sense of the long-term mood trends of your team.

The original concept is implemented by having three sets of marbles (green, yellow and red) for each member of your team and having them periodically select one to place it in a centrally placed transparent jar. Green is happy, yellow is neutral (or trending to red), red is angry/sad/overworked. With this simple system, everyone on the team gets a visual on the overall mood of the team and can collectively react and adjust when needed.

Of course, you don’t need marbles to implement this concept. It can be as simple as a piece of paper. You could also use one of those airport bathroom cleanliness “gizmos” and you ask everyone to press after your stand up meeting. It could also be implemented using sophisticated software tools such as Officevibe (Made in Montreal!).

Regardless of how you implement the concept, the important part is how you react to tangible information about the mood trends of your team. A happy team is a team that stays and grows together.

#3 – The Backlog

The Backlog is an essential Agile software development tool that can be easily repurposed for Procurement. It is essentially a list of prioritized items with a short description of the task to complete.

However, there are key differences between a backlog and a list:

• The items are prioritized by the requesters for each item (based on the criteria you determine)
• The item needs a rough effort estimate assigned to it (so the backlog can be used for high level capacity planning
• There needs to be a defined rules to update/change the backlog (i.e. a monthly review session)

This tool can be used for items as simple as capturing the continuous improvement wish list from team members and working on them in priority. Or, it can be used for items as essential as the planning of sourcing activities with your key procurement stakeholders (to complement your Sourcing/Contracting workflow system, for example).

A backlog can also be implemented with technology as simple or sophisticated as needed. It can be an excel file with permissions, a Trello board (free web based tool) or a JIRA board (Enterprise tool). You could even build it via reports in your S2P suite (e.g. Ariba, Coupa, Ivalua, etc.).

#2 – The Kanban Board

Next up on the list is the KanBan board. Whether or not you have a backlog setup, you can use a simple KanBan board in a central space to give everyone on the team a sense of the status of all ongoing projects.

In the sourcing or contract management context, the board can be as simple as five columns on a whiteboard with the following statuses:

• To Do
• In Progress
• Blocked
• Done
• Cancelled

Each sourcing/contracting activity is a large post-it on the board and includes the owner’s name and key project info. During your periodic standup meeting, these post-its act as a checklist to ensure the team has touched on all important items in flight. If the status has changed since the last time the team was briefed on it, the post it is put in the column that reflects its new status. Any stakeholder can also get a sense of the high-level status of any project and the volume of work being done by your team by glancing at the board.

#1 – Sprints and Retrospectives

As you work on running sourcing and contracting events, other agile tools to consider are sprints and retrospectives. A sprint is a predefined amount of your team’s capacity (i.e. 2 weeks). A retrospective is a meeting to take a look back at the sprint that just finished to brainstorm how the team can do better on the next sprint (productivity, morale, external perceptions, etc.). The retrospective can also be combined with a sprint planning review to see what is scheduled in the next sprint.

If this is the case, each category manager and their team would pick and choose items to deliver from the backlog based on their priority set by your stakeholders. They would come to a consensus on what they believe they will be able to fit in the sprint based on their initial rough order of magnitude (RoM) estimate for the task (often referred to as the item’s “T-shirt size”). Rinse and repeat over time.

The big difference between traditional management and this way of working is that:

• The reality of changing priorities and dynamics is at the center of your capacity management activities
• Continuous improvement is built into the process.

BONUS – The Playback

The last tool I would add to the list is the “Playback”. The playback is a meeting or conversation where you re-state your comprehension of a topic in your own words to your stakeholder(s) validate your understanding. In the context of a sourcing project, for example, you would hold a playback session after you’ve gathered requirements from all your stakeholders to confirm a unique version of the requirements and tradeoffs to consider for the event. This serves the dual purpose of confirming you didn’t miss anything, clears up any incoherencies and puts all your stakeholders on the same page before going out to market. This certainly isn’t a new concept but it is formalized in the Agile methodology.

Conclusion

While not all procurement tasks lend themselves to integrating Agile methods, there’s a whole lot that do. By playing with these methods in your procurement teams, I am certain you will learn valuable information about how your team can achieve more with less while having more fun in the process.

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What other Agile methods do you think could be used in procurement? Do you see value in using Agile methods and tools in procurement? What other domains could bring value to procurement? Let me know in the comments.

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Last Updated on January 4, 2021 by Joël Collin-Demers