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Agile Procurement Playbook

A guide on how to apply the principles of agile to procurement.

Introduction

Purpose of this playbook

The purpose of this playbook is to introduce an agile procurement model for software services, cover how it differs from some of the more traditional procurement plays, and introduce an iterative roadmap on transitioning toward a more agile procurement environment. While the handbook can help government contracting teams strategize on new procurements, the information within is best treated as a collection of helpful suggestions rather than strict guidance.

Intended audience

An agile procurement strategy includes stakeholders that traditionally might not have had a seat at the table during a product's initial planning phases. Because the strategy requires a greater understanding of a product's objectives along with the adoption of a modular contracting approach, the following roles will need to have early input on new products that'll be requiring procurements:

  • Agency contracting officer/specialist who's supporting the product,
  • Agency product manager
  • The agency's digital services team of research, design, and engineering

This procurement strategy is most effective when these roles act as a single team supporting the overall product.

Executive summary

In a quick overview of the U.S. federal IT project landscape, Brookings reported that in 2014:

  • $75.6 billion was spent on IT per year, which is more than the entire venture capital industry spends annually combined
  • 94% of the projects are over budget or behind schedule
  • 40% of the projects are scrapped or abandoned

Setting up the correct contracting strategy has the largest impact on the probability of success on most government products. Because of this importance, it's essential to measure performance indicators that track outcomes in order to:

  • Set direction and monitor the progress of the work, and
  • Intervene promptly when progress isn't tracking towards the product's objectives.

Procurement flexibility is the substrate underlying successful project management. Procurement flexibility can be defined as the ability to:

  • Award new tasks quickly
  • Shorten the initial period of performance
  • Optimize for contracts that speed digital service delivery for end users
  • Have a diverse pool of quality vendors that has digital service experience to draw from

The overarching goal for every procurement is presumably to deliver defined, expected outcomes for the product or service being procured. But the procurement strategy determines the amount of risk assumed in pursuit of that goal.

An agile procurement approach reduces the risks of product development by tailoring procurements to the products being built to meet the user's needs rather than having a generic procurement structure. Ultimately, this requires integrating the procurement team into the product management team.