Is "Agile Sourcing" the answer?
In this blog, partner Kevin Keith deconstructs the latest buzzword, which emanated from the well documented “Agile” methodology used heavily in product and software development but is now a hot topic in the world of sourcing.
“Agile Sourcing” has been increasingly mentioned to me over the last year. It’s nothing new: it has been around for many years so why are people talking about it so much?
Societal behaviour has changed dramatically over the last decade, with most things available to us at speed, arguably without any major dip in quality and all at competitive prices. We now have next day or even same day delivery of consumer goods, on-demand TV & audio, cooked food delivered to our door and real time social interaction at our fingertips. So, it is any wonder why we now expect similar types of innovation in the workplace?
When it comes to sourcing and in particular IT sourcing, innovation that is typically being requested is “a quicker outcome that avoids the bureaucracy”. But is agile sourcing the answer? Essentially it is little more than a combination of smart thinking, simplification, good communication and above all, collaboration. It’s the latter that sets it aside from the traditional approach to sourcing, but agile sourcing should not be seen to dodge governance, shortcut quality or simply be a vehicle for doing sourcing quickly.
Sadly, this idea of doing things quickly and focussing on accelerating market engagement, supplier selection, evaluation and contracting can often result in a poorly executed programme that results in clients paying the price in the long term. There’s a well-used saying made in the IT community that, in reference to complex projects, states “good, fast and cheap: pick two….” If agile sourcing has secured “fast”, which one are you willing to sacrifice?
IT sourcing can be complex, but with smart thinking we can challenge convention, tear down preconceptions and if you pardon the cliché; “take everyone on the journey”
Speed is just one of the outcomes of an agile approach but through proper collaboration we can generate value in many forms, including mutual better understanding of requirements, much better service/product descriptions and stronger relationships.
When the subject of agile sourcing comes up in conversation, I’m often asked questions such as:
- How will we select the suppliers to participate and do we still need to run a formal process?
- Do we have to include the incumbent supplier and how many suppliers need to be invited?
- How long will this take, can’t we just pick one and get going?
- When will we know the cost?
- How can we source when we don’t even know the requirements?
These are all valid questions to be asked whether you are planning to run an agile engagement or a more traditional approach. However, with agile often comes amplified expectations and that’s where careful planning and paying particular attention to the desired outcome is vital for success. Simply being gung-ho and focused on speed is unlikely to get the desired results or create lasting value.
When asked about agile sourcing I first like to explore what’s really driving the request; is it purely speed of outcome at any cost? Or to avoid bureaucracy and to “move things along as quick as possible”? Or is it because the client fully understands sourcing and realises the benefits of balancing structure and adaptability without sacrificing quality?
Agile Sourcing is really nothing more than traditional sourcing improved through smart thinking, innovation and collaboration to enhance the overall engagement and importantly to reduce the problems that can become exacerbated when applying traditional methods.
So, is Agile Sourcing the answer? If you are after a sourcing engagement that is predicated on collaboration and innovation with speed of outcome at the core, at the best possible price, then perhaps. But if you have high-quality, long-term benefit delivery and true partnership at the core of your relationships, perhaps not. At This Partners we have developed an agile, collaborative and proven sourcing approach which encapsulates the very best elements of both traditional and agile sourcing. Furthermore, we’ve developed new elements that have been refined and evolved over the last 13 years that allow us to meet the ever-changing needs of our clients.
We believe that blindly following a prescriptive methodology never works. However, collaborating closely with clients and potential suppliers to fully understand both parties needs and aspirations creates lasting value and builds a foundation for long term, high performing relationships.