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Über dieses Buch

This book is the first of two volumes presenting a business model to add value through Procurement. Including several case studies of successful implementation, it demonstrates how the increasing complexity of the business environment requires a significant intervention on the management of processes and information within individual organizations and through inter-company relations. Agile Procurement presents the application of the Agile method which optimises and digitizes processes in order to reduce wastage and defects. As a method, tool and a culture aimed at effectiveness, efficiency and economy of organisations, agile procurement requires a change of paradigm. This volume examines these areas of improvement and presents best practice in improving processes. Each chapter of the book presents and substantiates the costs and benefits of process improvement through agile procurement. This is is seen as the integration of Lean Six Sigma and digitization.



1. Introduction to Agile Procurement Processes

In difficult times and under pressure to grow and be profitable, it is essential for organizations to become more agile. One of the ways to reach this objective is to use external resources, possibly in a variable mode. This allows for shifting capital investments in resources to operational expenses and gaining flexibility. This chapter describes how innovation in procurement can contribute, by helping the organization reach its agility objectives and, at the same time, become itself a more agile function. In order to reach these objectives, it is important for procurement to become leaner and more digitized. The first requirement is to improve processes and eliminate waste as much as possible. This first volume concentrates on how to re-engineer processes in the direction of agility and leanness. The second volume analyzes how procurement can be digitally transformed.
Bernardo Nicoletti

2. Procurement Processes

In order to improve processes, it is important to define clearly the ‘As Is’ processes and how to move towards the ‘To Be’ processes. In the case of procurement, one of the best ways to describe current processes is to distinguish between the components of procurement processes. These can be described as sourcing, supply, logistics, transportation, storing, movements, and distribution. This chapter aims to present a precise definition of these terms and how they inter-relate. It also analyzes each of these processes and describes them in detail.
Bernardo Nicoletti

3. Agile Procurement

Agility aims to increase the flexibility of organizations in a variable and evolving environment. This chapter analyzes these changes and the challenges they pose to procurement organizations. It presents an innovative classification based on changes in the customers, the competition, the compliance, and the cost dynamics. It shows how to respond to these challenges by approaching procurement as a business, and describes the components of the business models that procurement should adopt and how they should change to make procurement more agile. The business model considered in this volume for this approach is the so-called business model canvas (BMC), introduced by Ostwalder and Pigneur. The chapter describes how it is possible to apply BMC to procurement. The remaining part of this two-volume book concentrates on how to act on the BMC components to improve processes in the direction of the agility.
Bernardo Nicoletti

4. Agile Procurement Support of the Value for the Customer

To support reaching the objective of agile procurement, this book moves from the traditional definition of supply chain to that of value network. This chapter describes the changes in the operation of most organizations from a serial series of activities, as in the old “supply chain,” to a network of activities. It also stresses the importance of analyzing the value contribution of each activity in order to reach the organization’s objectives. This chapter describes how the value proposition should consider mainly the value that can be added by the organization for the end customer. The value for the organization itself should not be the primary objective, but an objective derived from the previous one. With this vision in mind, the chapter analyzes the approach to agile procurement, and the ways and tools to increase value for customers.
One aspect that is growing in importance is procurement of the energy necessary for the operations of the organization. The green procurement approach is important to reduce waste and to add value for the customer and society. This chapter analyzes ways to do so with better and more agile energy management.
Bernardo Nicoletti

5. Customer Relationships and Agile Procurement

This chapter examines the relationships among procurement and other stakeholders.
The chapter underlines the importance of customer relationships and describes how some new solutions, such as big data analytics, can help organizations understand customers and their behavior better. Because the use of big data analytics is costly, the chapter describes how to evaluate the business case for using them and ways to improve it.
Thanks to the digitization of many activities and to the Internet, data are more and more accessible. Open data refers to data available free of charge through the Internet. The chapter illustrates the characteristics of open data and their use in procurement. The last part of this chapter is dedicated to the collaboration of procurement with both customers and vendors. This is a powerful way to increase value for customers, especially once supported by new advanced solutions. In this case, it is called e-collaboration. The chapter describes how e-collaboration can increase the effectiveness, efficiency, and economics of the collaboration of procurement with all its stakeholders.
Bernardo Nicoletti

6. Processes in Agile Procurement

This chapter deals in detail with procurement processes and how to make them more agile.
The emphasis is on the “To-Be” following process optimization. The chapter examines in detail how to make strategic procurement, sourcing, requests for acquisition, vendor marketing, requests for proposals, selection, negotiations, contractualization, order issuing, and acquisition administration more agile. It stresses the importance of vendor rating for better selection of partners for future acquisitions. The last part of the chapter analyzes procurement process intelligence. This approach is becoming increasingly important. It combines business intelligence with process management and optimization. It is an excellent way to increase agility for organizations.
Bernardo Nicoletti

7. Resources and Agile Procurement

This chapter analyzes the human resources contribution to agile procurement. Key resources and key activities are the most important components of any initiative to improve processes. This chapter dedicates particular attention to the selection, management, and improvement of the human talents in the organization. Resources have different characteristics in the different types of industries. This chapter initially examines how procurement resources can help in making manufacturing companies more agile. Then, the chapter describes a similar process for procurement in services industries. In that case, the chapter examines the different types of services, and goes into detail for the cases of telecommunication, business travel, and retail organizations.
Bernardo Nicoletti

8. Costs and Agile Procurement

Business processes largely determine the costs also in procurement organizations. This chapter examines in detail the methods of lean thinking. It introduces the principle of leanness and looks in detail at the main tools available to eliminate waste. The chapter discusses value stream mapping, kaizen, kanban, just-in-time, SIPOC, autonomation, and heijunka. It stresses in particular the importance of improvements in the lean thinking method itself, such as Lean Six Sigma, lean and digitize, and leagile. The latter method is a combination of lean thinking and agile methodologies. It allows for a bimodal mode of management and operations of procurement, applying the best of both methods to different parts of the organization processes.
The last part of the chapter examines procurement finance. This is a development with respect to the traditional trade finance and supply chain finance. It extends the consideration to all procurement processes and their financing.
Bernardo Nicoletti

9. Conclusions for the Agile Procurement Processes

The last chapter of this volume draws some conclusions about possible initiatives for improving the agility of procurement processes. It summarizes the conclusions of the first volume dedicated to procurement processes improvement. It introduces the themes of the second volume, which focuses on the digitization of procurement processes. These volumes stress how the two aspects should be approached together with a lean and digitize objective.
This volume includes a very large and detailed glossary that provides short descriptions of not only the main subjects covered in the volume but also some of their interesting extensions.
This volume also includes an Index. It is structured in order to provide references in the volume to the main subjects connected with process improvements in pursuing agile procurement. The chapter includes a rich bibliography on process improvements for making organizations more agile. It includes the main works on the subject since 2000. The chapter also provides references to some of the main websites that are useful for academicians and practitioners of agile procurement.
Bernardo Nicoletti


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