Agile in Public Procurement Projects

Aleksej Kovaliov, TEO LT, Agile Lietuva

The impossible is often the untried (Jim Goodwin)

Me

• Aleksej Kovaliov

• aleksej.kovaliov @ gmail.com

• https://www.linkedin.com/in/aleksejkovaliov

• http://www.slideshare.net/akovaliov

• http://www.bdcinstitutas.lt/autorius/23

• http://akovalyov.wordpress.com/

What first comes to you mind when you hear….

Some stereotypes. Any resemblance to real persons, projects and organizations, living or dead, is purely coincidental

…Public Procurement

• Low Efficiency and High Waste

• Legalized Over-complication

• Fierce Competition

• Claims & Lawsuits

• Corruption

DEREK HUETHERZombie procurement

…Public IT Projects

• High CAPEX

• Fixed price & Fixed scope & Fixed deadlines

• Unqualified Customer

• Requirements Over Goals

• Undefined Complexities

• Overdefined Simplicities

• Outdated Architectures

• Poor Usability

• “SaaPA” – Software as a Political Asset

• Big Boys’ Club

• Redundancies

DEREK HUETHERZombie procurement

Infinitely Long Requirements Lifecycles

EU / Government

Program

Feasibility study

Technical specification

Procurement specification

Tender Contract Analysis

1-3 years 0,5 year

0,5-1,5 yearimplementation

Barriers for Improvements

• Legal Focus on HOW do organizations buy• Not WHAT do they buy

• Lack of the Championship for Change• Disperse ownership among ministries• Top-to-bottom Command and Control

• Lack of Economic Motivation for Change• EU Financing models• Buyers Not Interested• Sellers Not Interested

How Can Agile Help?

• No Need To Define The Indefinite

• Faster Study to Project Lifecycle

• Faster and Usable GO LIVE

• Quota for Intermediate Mistakes

• Requirements Aligned To Reality

• Stop When It’s Enough

• Suppliers’ Risk Management

• Innovation Enablement

http://blog.projectassistants.com/tag/agile-methodology/

Not Easy, but Still Possible to be Agile

http://mathtourist.blogspot.com/2011/05/riding-on-square-wheels.html

Situation in Lithuania

Public IT Procurement in 2013

• IT Services etc.• 298,2M LTL = 86,3M EUR

• 447 purchases

• Software and Information Systems• 102,1M LTL = 29,6M EUR

• 225 purchases

http://www.vpt.lt/vpt/uploaded/2014/vp/Informacija%20apie%202013%20m.%20viesuosius%20pirkimus.pdf

Legal Background

• Law on Public Procurement

• Law on Information Assets

• Information Systems Lifecycle Methodology (AGILE included!)

• Ministry of Justice

• Ministry of Transport and Communications

• Ministry of Interior

• Information Society Development Committee• Ministry of Transport and Communications

• Public Procurement Office• Ministry of Economy

• Focus on Transparency & Control

Agile Under Cover … - 2014

• Not Forbidden, Not Welcomed

• Mandatory External Waterfall 99%

• Rare Agile at Home

• Unofficial Intermediate Reviews and Product Owners

• Agile Lietuva Association, www.agile.lt• Agile Alliance

• Scrum Alliance

• Agile Lean Europe Network

Legally Agile 2014 - ….

• Information Systems Lifecycle Methodology• Appendix#1: Implementation Approaches #3: Iterative-incremental

• Appendix#2: Recommendations

Scope Detail requirements

Waterfall Modular Iterative-incremental

Big Defined X X

Undefined X X

Small Defined X

Undefined X

Digital by Default Service Standard

Government Service Design Manual

But How Would It Work?

http://www.condenaststore.com/-sp/Great-but-how-is-he-in-bed-New-Yorker-Cartoon-Prints_i8541755_.htm

Ken Schwaber says…Scrum’s principle

is “the art of the possible,”

not “you give me what I paid for, when you said that you’d

deliver it.”

http://www.incrementor.com/agilenyc/past-events/2010-2/110310-ken-schwaber/

Agile Project Management with Scrumby Ken SchwaberMicrosoft Press © 2004

Agile Waterfalls

Typical Milestones in Public IT Project

Approach1: Agile Under Cover

Approach2: Project-as-a-Product

+• Plan as a Product to Market

• Strategic Roadmap

• Beta Milestones

• Go Live Milestones

• Draw a Poster!

• PjM Formalities is a just a Package

• Filter Real Goals and Priorities

• Slice the Scope

• Cut the Redundancies

Map BETAs to Waterfall Milestones

Product Release Plan / Roadmap (example)

Prioritized Features Alpha1 Alpha2 Alpha3 Alpha4 Alpha5 Alpha6

Data exchange module Beta1

Documents and tasks module Beta1

Execution module Beta1

Control module Beta1

Operator module Beta1

User provisioning module Beta1

Bendrųjų klasifikatorių posistemis Beta1

Utilities modules Beta1

Documentation

IT Platform

“Product” is growing with every releaseThe same features are being improved with every releaseBacklog is filled in with scenarios

Split BETAs to Agile Sprints for Each Milestone

1 2 3 4 5 6In

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DEV

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Exte

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DEV

En

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Alpha6XAlpha2X Alpha4X

Alpha4Alpha1 Alpha2 Alpha3 Alpha6Alpha5

Exte

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PR

OD

Envi

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BETA1

BETA 1Candidate

Approach3: Standard Methodologies

• PRINCE2 – Management and Control• Business Justification• Stakeholder Engagement• Management Control and Direction• Manage by Stages• Manage by Exception

• Agile DSDM (Atern) – Delivery and Development• Focus on Business Needs• Deliver on Time• Collaborate• Build Incrementally from Firm Foundations• Develop Iteratively• Demonstrate Control

Whitebook: PRINCE2 combined with Scrum

Waterfall PRINCE2 is Agile

Controlling a Stage, Managing a Stage Boundary, Directing a Project

Managing Product Deliveryhttp://www.slideshare.net/apmg-inter/prince2-agile-management-delivery-apmginternational-webinar

Agile Procurement

Fundamental Changes

• In the Way Suppliers are Selected and Contracted• Selecting a Supplier and not a solution

• Thinking Business Outcomes rather than Detailed Requirements• Goals over Requirements

• Public Procurement Regulations• From Transparent to Transparent + Efficient

Agile Contracts <> Risky Contracts

Risk

CustomerIn-house

Team

Outcome Based Contract

for Supplier

Waterfall Approach

Agile Apporach

http://www.westminster-briefing.com/fileadmin/westminster-briefing/pastevents/IPL.pdf

T&M

T&M

Risk Reward Fixed Price

Fixed PriceFor Fixed Effort

Volume-based:Fixed Price for committed

+Velocity/Price for additional

More Agile Contracts Types

• Contracting to Support Modular Development• http://www.whitehouse.gov , 2012, June

• Indefinite delivery / quantity contracts

• Single contract with options

• Successive contracts

• Performance-based Work Statements

• Fixed-price contracts and task orders

• Cost-reimbursement contracts

• Time-and-materials contracts

• Incentive contracts

• Hybrid contracts

What Next?

Roadmap

Past

• Start Using Agile in Public IT Projects

• Update LT Public IS Development Methodology

2014

• Recommendations and Guidelines

• Educating the Institutions and Suppliers

2014+• Feasibility Study of the Agile Public Procurement

model for LT

???

• Update LT Law on Public Procurement

• Update LT Law on Public Information Resources

Thank you! Questions?