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Understanding Lean Agile Procurement: A Game Changer for Modern Businesses

Introduction to Lean Agile Procurement

Lean Agile Procurement (LAP) is revolutionizing the way organizations handle procurement. But what exactly is it, and why should you care? Let’s delve into the origins, principles, and benefits of LAP to understand how it can transform your business.

The Origins of Lean Agile Procurement

Agile methodologies have been around since the mid-90s, evolving and expanding across various industries. However, procurement and legal departments have been slow to adopt these principles, even though they are crucial enablers of agile practices.

Early Work and Development

Notable work by Craig Larman, Bas Vodde, and Gabrielle Benefield laid the groundwork for flexible contracts in agile environments. Despite their efforts, these practices didn’t fully penetrate organizational procurement processes. Enter Mirko Kleiner, who introduced the concept of big room planning and founded the Lean Agile Procurement Alliance, a turning point in the agile procurement landscape.

The Lean Agile Procurement Process

LAP integrates lean and agile principles into procurement, streamlining traditional methods into a shorter, more efficient framework. Here’s a breakdown of the LAP process:

Phase 1: Preparation

Objective: Gain clarity on procurement needs within the organization.

  • Techniques Used:
    • Business canvases
    • Personas
    • Backlogs
  • Duration: A couple of weeks

Phase 2: Partner Engagement

Objective: Educate potential partners about LAP and set up the necessary legal frameworks.

  • Key Activities:
    • Educating partners on LAP
    • Setting up non-disclosure agreements
    • Establishing base terms and conditions

Phase 3: Big Room Planning

Objective: Co-create working agreements and contracts with potential partners in a collaborative setting.

  • Duration: Typically 2-3 days
  • Outcome: Contracts are written, agreed upon, and signed

Phase 4: Execution

Objective: Implement the agreed contracts with a focus on flexibility and adaptation.

  • Key Benefit: Reducing the time frame from months to days

Why Lean Agile Procurement Matters

The world is becoming increasingly volatile, complex, and ambiguous. LAP provides the necessary framework to manage risks, ensure a good fit with partners, and adapt quickly to changes.

Key Benefits of LAP

  1. Risk Management: Ensures potential partners are a good fit and manages risks effectively.
  2. Speed: Accelerates the procurement process from months to days.
  3. Flexibility: Embeds flexibility and adaptation into commercial frameworks.

Practical Applications and Personal Experiences

Having worked with a multinational company in a heavily regulated industry, I found LAP to be a game-changer. The challenges of finding and selecting partners and managing risks were significantly mitigated through this approach.

Real-World Examples

  • Cost of Delay: Traditional procurement processes can lead to significant delays, costing more than the potential savings from a lower price. LAP flips this outlook by focusing on the bigger picture and overall business impact.
  • Collaborative Ecosystems: By fostering win-win situations, LAP supports resilient business ecosystems that can adapt to market shocks and disruptions.

Becoming a Lean Agile Procurement Expert

My journey with LAP began when I met Mirko Kleiner at a conference. Impressed by the potential of LAP, I pursued further training and eventually joined the board of the Lean Agile Procurement Alliance.

The Board’s Mission

Our mission is to promote the adoption of LAP, support our trainer community, and help organizations achieve mutual wins through effective procurement practices.

Board Members

  • Mirko Kleiner: Founder and experienced agile practitioner
  • Philip Angler: Expert in agile coaching and consulting
  • Paulo Selli: Specialist in agile hardware
  • Sophie Durand: Advocate for LAP in government and charity sectors
  • Myself: Committed to advancing LAP practices

Addressing Common Procurement Challenges

LAP is particularly effective for complex procurement needs. Here are the three significant challenges it addresses:

1. Time to Action

Traditional procurement processes are often lengthy and bureaucratic. LAP’s big room planning sessions bring all parties together, resolving issues quickly and reducing time to action.

2. Flexible Contracts

LAP promotes creating contracts that allow for adaptation and iteration without punitive clauses. This flexibility supports continuous learning and adjustment, aligning with agile principles.

3. Cultural Fit

LAP facilitates a partnership model, reducing friction and building trust between organizations and their partners. This cultural fit is crucial for successful long-term collaborations.

Conclusion: Embrace Lean Agile Procurement

Lean Agile Procurement is not just a method; it’s a mindset shift towards creating adaptive, resilient business ecosystems. By integrating LAP, organizations can enhance their procurement processes, manage risks better, and achieve greater business agility.

Your Next Steps

Consider running a small experiment within your organization to test the waters with LAP. Start with internal teams to practice the process before expanding to external partners. The competitive advantage gained from adopting LAP could be significant.

What’s holding you back? Embrace the change, and let Lean Agile Procurement propel your organization into the future. 🚀

Connect with Advanced Product Delivery.

APD offer private, tailored training courses as well as business agility and coaching. Our public training courses are delivered by practicing Agilists: Product Owners, Scrum Masters and coaches who are expert trainers and facilitators.

Whether you are looking to become a #scrummaster or #agilecoach, we have a range of internationally certified and recognised #agiletraining courses that are perfect for you. Visit Professional Scrum Training courses for more information.

If you are looking for professional, deeply experienced and skilled #agilecoaches and #agileconsultants to help you transition from traditional #projectmanagement to #agile #productdevelopment, we’ve got the ideal team to help you make that transition a success. Visit our Agile Coaching section to find out more about us.

If you have identified Lean Agile Procurement as a great opportunity to enhance #agility within your organization, visit the Lean Agile Procurement Training course or Lean Agile Procurement coaching page.

#agile #scrum #agilecoach #agileconsultant #agiletraining #agilescrumtraining #scrumtraining #scrumcertification #scrummaster #productowner #leanagileprocurement #apd #businessagility #organizationalagility #productdevelopment #projectmanagement #agileprojectmanagement #agileproductdevelopment

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