The Procurement team at Auckland Council was brave enough to apply the Lean Agile approach to sourcing earlier this month. After attending the first NZ LAP Workshop back in April, Auckland Council was inspired by the speed and results that the LAP approach can achieve – shortening the RFP process from months to days. In August, the team decided to put the theory into practice, and apply LAP and the Lean Procurement Canvas to the sourcing of a digital strategy provider.
After two full-on days of collaboration and working through the Lean Procurement Canvas with 3 potential suppliers, all in the same room, Auckland Council was able to select their preferred supplier. With one LAP Event under their belt, Auckland Council has reflected and shared some insight into how the approach worked for them.
A quote from one of the Procurement Managers highlights what LAP can achieve – “By the end of the two days, we were confident we picked the right supplier.”
The benefit of having everyone, including the decision makers, in the room meant that negotiations could happen quickly (within half an hour) and real time feedback could be provided to suppliers throughout the day.
Efficiency and effectiveness of internal team
During the Plan and Prepare phases, the internal Auckland Council stakeholders were clear on their expectations and requirements as a lot of this planning was completed ahead of time. Based on feedback from Auckland Council, there was less time required from internal stakeholders to achieve this result (think: hours of evaluations significantly reduced through LAP).
Throughout the two days, Auckland Council was able to understand the supplier’s weaknesses and was able to share their concerns on any aspect of their proposals. It was an open and transparent process to ensure there was no misalignment.
Some key learnings
Don’t underestimate the planning
Auckland Council followed the Plan, Prepare, Do methodology to deliver their LAP event. The work involved in the Plan and Prepare phases were crucial to the success of their procurement. Significant planning is required upfront to ensure the right problem is being addressed, it is defined correctly, and the right suppliers are selected. Auckland Council sent REOI (requests for expressions of interest) to selected suppliers and from there shortlisted 3 suppliers to progress.
Once suppliers are shortlisted, preparation is key to ensure the LAP event runs smoothly. Preparation of all materials required for the two days should commence a couple weeks before the event.
Get the right people committed in advance
For your first event, pick a good customer! A customer willing to try something new and open to a different approach is crucial. Since decision-making happens quickly, make sure that subject matter experts and end users of the product/service are involved at the start of the process and during the workshop. This applies to both the buyer and the supplier. The SMEs will understand the detail and can work with suppliers throughout the workshop to achieve the best result.
Since you are locked in a room with your 3 potential suppliers for two full days, you get to know who you will be working with after contract award. In traditional RFP processes, you may only meet the bid team and base merit solely on the quality of the emailed response. In LAP, you meet the delivery team, you learn their strengths and weaknesses, and “what you see is what you get”.
On the whole, Auckland Council believed that they achieved more value out of this approach than through a traditional RFP approach. Feedback from the suppliers was positive as well, as this was a new way of responding and challenged their approach to demonstrating the value they can bring.
Mirko Kleiner, thought leader in Lean Agile Procurement, will be returning to New Zealand to host two workshops in Auckland and Wellington. Don’t miss out on this opportunity to learn how LAP can improve the effectiveness and efficiency of procurement.
Click below to register:
Sydney – 18 & 19 September: https://procurementandsupply.com/competitive-advantage-via-lean-agile-procurement-credential-1/ (Only four spots left!)
Auckland – 24 & 25 September: https://www.lean-agile-procurement.com/event-details/?id=gL5qQp9I
Wellington – 14 & 15 October: https://www.lean-agile-procurement.com/event-details/?id=QdlMsD6m