Agile Supply Chain & Procurement and Process Technology

It’s been a difficult and challenging year for everyone across the world. Whatever happens in 2021 one things for sure no one knows the future so we need to be prepared for the unexpected. Agile has been a hot topic for years, but more recently has pushed into each function within the business including Procurement.

Procurement is the gateway to the world for an organization and needs to be adaptable to the changing conditions outside. An agile procurement function can support business continuity and help the organization respond quickly, and can also help support society and the nation with local content, employment and keeping supply lines open.

 Agile across the organization is not a technology, it’s not a process by itself, rather it is a mindset. Agile focuses on outcomes deliver in days and often, and lets people focus on people tasks.

With the changes in the world agile is even more important for us to be able to adapt to the future. We need to simplify, remove waste and deliver in days not years just like we did during lockdown – why can’t that just be normal? Well, I believe it should be.

Agile Procurement

When we think about procurement, we normally think about lots of processes, lots of steps and lots of paperwork. Agile procurement is the opposite: minimal steps, no paperwork, and delivery at speed.

 The old RFx processes are not fit for purpose for technology in today’s dynamic world, by the time the sourcing process is completed months have passed by, and the original request may not give the same value to the organization as originally intended.

 We need to adapt and simplify these processes for emerging technologies, and to work with startups as that’s where most of the innovation comes from. Think about partnering using PoCs to pilot newer technologies and then use strategic sourcing to open up the supply base for others.

 Agile Processes and Technology

Technology like RPA can help automate low-value tasks and is fundamental for all organisations to become leaner. RPA is a bot that can be taught to do simple, repeatable tasks that do not require decisions across various systems by recording human clicks and text entries. RPA can automate most of the sourcing process including PR-PO, increase quality, reduce time to market, and free up your teams to focus on building relationships.

 Digital contract management platforms can also help improve agility. Contracts can be co-created and reviewed by all stakeholders including procurement, legal, partners, and the business and allows procurement to focus on building strategic partnerships. Master Frame Agreements (MFA) a type of contract that establishes the framework under which future contracts between the parties will be concluded can help reduce the time taken to award. The complexity of contracts can be conducted upfront during the onboarding process, then any subsequent contracts only need to take care of the project details. Having the MFA in place along with a user friendly, collaborative digital contracts management solution will help organisations to anticipate and react to market changes more rapidly with closer collaboration with partners on future strategies.

 The pandemic highlighted flaws in the contracting process, where contracts need to be printed and executives need to be on-site to sign. Digital signatures for procurement contracts eliminates the need for everyone to be on-site, is auditable and secure. The digital user experience reduces the effort needed for the awarding process and accelerates times from weeks to days or even hours. 

 Tips for Implementing Agile

Automate as much as possible, hyper-automation, as Gartner put it, is a trend for 2021. This will help transform your processes and remove waste where possible. Think which part of the process creates value, and remove any steps which no longer add value.

 Agile is a mindset so couple your efforts with a culture change initiative and have the right mix of talent within your team. Agile pushes decisions to the front line so the team need to be self-organising decision-makers who understand the balance between value creation and risk. Coaching is a key foundation which can help produce agile practitioners of the future.

Remember Agile is a mindset and requires effort to change behaviours. In today’s environment where the future is unpredictable agile is no longer a choice.

What are you doing or planning to become more agile at your organisation in 2021? Let me know in the comments.