Development of an Agile Model for Procurement Risks Management in Projects at IT Company

In this paper the author provides the reasons for considering uncertainty when managing procurement in projects, especially in IT companies. In order to fill this gap in traditional project management methodologies, the author makes an analysis of agile approaches and uses their elements in the suggested method of managing procurement risks in projects. Distinctive features of this method are iterations included in the process, a possibility of gradual procurement planning, application of network analysis (in order to take into account the interrelations in the system), several levels of suppliers included in the model. The author's mathematical model of supplier selection is included as a part of the suggested methodology. The model optimises procurement risks in projects taking into account the cause-effect relationships of risks, priorities of project constraints and individual characteristics of counterparties’ exposure to risks. The author tests the proposed approach in an IT company. Based on the results of the study using simulation modeling, the effectiveness of the method is proved. The author also gives recommendations how to use the methodology in a company, how to use a procurement system to automate the model and how to implement the procurement system.