July 18

Episode 039 – Agile Procurement – Kanban

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In this 3rd and last part of our series, we cover KANBAN

Episode Highlights

  • KANBAN is a task management approach originally invented by the Toyota Motor Company
  • For procurement, Kanban or a Kanban board is a great tool to organize workload
  • The core component of Kanban is the Kanban board
  • In its simplest form this board has three columns
    • The BACKLOG column
      • this is where all new tasks land
    • The IN PROGRESS column
      • this is where tasks from the BACKLOG are put once someone starts working on it
    • THE DONE or COMPLETED column
      • this is where finished or deployed items go
    • in software or product development there is often also a TESTING column
      • here is where the product or item gets tested before it moves to the COMPLETED column
  • Once again, as in the previous two parts of this series, the items we move around are user stories
    • in our procurement life, this would be demands
  • One important improvement over the previous methods is that both, user stories and the columns have capacities attached to them
    • a project user story or demand might take 20 days to complete
    • each column also has the max capacity of a person or group
  • this gives us a good indication, if we are running out of capacity
  • Let's see this in practice for a group of 5 buyers in a procurement department
    • assuming an 80% capacity for negotiation tasks this would give us a capacity of 80 days per month for the group
    • 5 buyers times 5 days per week times the 80% capacity times 4 weeks per month
    • let's assume we have 4 demands we're currently working on:
      • demand 1: 25 days
      • demand 2: 10 days
      • demand 3: 30 days
      • demand 4: 5 days
    • these demands will go from the BACKLOG to the IN PROGRESS column
    • now a new demand pops up with a required capacity of 10 days
      • we could still do that because we have that capacity
    • but it's a different story for a demand that would require 30 days
      • it violates our maximum capacity threshold
      • we need to openly discuss with our stakeholders, that this is not possible to execute right away
      • it could also be used to discuss a temporary extension of our team with our managers
    • one closing point on this great system that it works best, if you have a publically available Kanban board
    • this could be a virtual tool but best - from my experience - is a physical whiteboard with user stories as cards on it
    • transparency is key when it comes to sharing with your organization who is working on what
  • Resources


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