Exclusive Trusted Magazine Q&A with Sergii Dovgalenko, Head of procurement, consultant, tutor, book author, procurement process architect.
How could you describe your career path in few words?
I worked in procurement for 22 years - telecom, airline, railways, public infrastructure services and consulting industries, and multiple geographies. I’m a Fellow of CIPS and an author of “The Technology Procurement Handbook,” where I tried to share my passion for what we used to call “IT Procurement.” This is where I started digging deeper into the Agile agenda, thinking of finding repercussions with our professional life and blogging on related topics.
How do you think agile practices have transformed companies over the past two years?
I assume that Agile practices in procurement are hyped more than used: many companies still mandate the use of the RFx as the sole answer to any emerging sourcing requirement, many fear or don’t appreciate the demand management, and digital transformation frequently happens without any comprehensive strategy and benefits tracking. Our strategies and plans aren’t agile enough - not incremental, not flexible enough, and not fit for the fast course adjustment in response to the ever-changing business environment.
However, the appetite for change is increasing. Colleagues establish highly specialized Centers of Excellence for game theory-based negotiations to excel in the process and send transactional duties to low-cost countries so that they may dedicate more time to strategic tasks. They recognize the value of suppliers and work on relationship development. Most importantly, they aren’t solely obsessed with savings and seek value delivery opportunities. We’re getting closer to the business by embedding their SMEs in our rosters or through the procurement partnership.
Indeed, technology (IT) procurement is the most affected by Agile practices, as they have to support agile production processes.
What successful cases of agile transformations have you had the opportunity to observe that have particularly stood out to you?
The first example that comes to my mind is the successful shared risk and reward cost optimization project, where top-notch consultants competed for the share of mutually acknowledged savings. This is where we could witness and participate in a valid demand management process (consultants were free to challenge any spend or legacy process; they were sufficiently empowered and not afraid to waste relationships with end-users.)
In the true spirit of agility, they divided the project into sprints, regularly measured results and analyzed lessons learned, selectively used RFx, and spent most of their time studying business practices, where they found most of the waste elimination and savings opportunities. Eventually, we embraced the same spirit and went deeper than usual into the requirement analysis and sourcing strategy development, which allowed us to harvest some exciting outcomes - we even teamed up with HR to patch loopholes in some policies before we started negotiations, so the scope was spot-on.
Unfortunately, I never witnessed such a level of empowerment anymore as when I was a consulting team member.
Will agile practices continue to generate interest? What challenges do you see in the context of deploying these practices?
Indeed, Agile practices will continue to generate interest, just as Lean ones, because each of those fits specific circumstances. Like in the supply chain context, the lean strategy works best for goods with long lead times and predictable demand (e.g., large home appliances). In contrast, the agile strategy manages items with unpredictable demand and short lead time (like IT peripherals).
I cannot think of a better approach than Agile, e.g., when we address the indefinite-scope requirement where traditional RFx hardly works. The main challenge is switching everyone's understanding that we’re not pitching for a scope but aiming to segregate the best performers from the worst. We’re not just buying goods or services - we manage risks!
We must be convinced that the selected supplier is the fittest for purpose, not the cheapest. Therefore, I liked this Agile-related statement from a random expert on Linkedin: “…it is about augmenting (with best performers) and reducing (with worst performers) your relationships over time.”
About Sergii Dovgalenko :
Sergii Dovgalenko is an established procurement executive with 21 years of experience across different industries and geographies. Sergii was the head of procurement in the telco, aviation, and railway industry and is interested in technology, IT operational models, project management, Agile methodology, and service delivery.
He develops the procurement blog “The Good Spending,” where he writes about all the topics of interest. He is the author of “The technology procurement handbook: a practical guide to digital buying,” which became the basis for the bespoke training course. Sergii holds FCIPS designation and is licensed by CIPS as a tutor.
The link to my blog : https://ukrsedo.blogspot.com/
The link to my book : https://www.koganpage.com/logistics-supplychain-operations/the-technology-procurement-handbook-9781789662108
Sergii Dovgalenko https://www.linkedin.com/in/sergiidovgalenko/
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