Process Maturity in IT Initiatives

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Digité offers a process platform and infrastructure for managing IT initiatives where users can
access instant best in class processes specifically tailored for the Internet project delivery that
will enable them to shorten delivery schedules, improve product quality and increase
development productivity.

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Process Maturity in IT Initiatives

  1. 1. diginotes Process Maturity in IT Initiatives The State of IT Projects There are over one hundred IT initiatives and software projects started every hour in the US. A staggering 31% of these projects will be canceled before they ever get completed. Another 52.7% of projects will cost 189% of their original estimates. Less than 17% of them will meet their original cost and time estimates, causing an estimated $140 billion loss in cancelled or over run projects.1 Risk is always a factor when pushing the technology envelope, but many of these projects were as mundane as a customer contact management application, a new accounting package, or an order entry system. While the majority of IT consulting companies and in-house IT departments will fall into this category, there is a small elite group of companies that consistently meet their delivery schedules and cost estimates while delivering products of almost perfect quality. Our vision at Digité is simple: offer a platform that allows all IT organizations to join this elite band of top performers. Our process model will allow organizations to achieve quality mature processes by choosing to participant in a best in class established process rather then having to establish one. These organizations will be able to access instant best in class processes that will help them to shorten their delivery schedules, improve product quality and increase development productivity. Process Maturity Mature software development processes are distinguished from ad-hoc processes by their ability to, at a minimum, ensure consistent output quality. Mature processes can be further classified into levels of maturity consisting of repeatability (output can be statistically guaranteed consistent), managed (output can be predicted and action can be taken to correct it), and optimized (data from the process is used to improve or re-engineer the process for increased throughput or quality). Leaders Laggers Category (Mature Process) (Ad-Hoc Processes) Relative Development >25 Functions Points <5 Functions Points Productivity per Persons Months per Persons Months > 5X Defect Removal > 95% before < 50% before before Delivery Delivery Delivery > 30X Estimate Consistency < 10% > 40% > 30X Defection Correction < 1 % of Development > 10 % of Development after Delivery effort for next 1 year effort for next 1 year > 10X Table 1: Differences between Organizations with Mature Software Development Processes versus those without Mature Software Development Processes. Source: “Software Process Improvement, Sami Zahran, Addison Wesley, Page 393 1 “The Chaos Report”, 1995, The Standish Group,A copy of the report is located at www.standishgroup.com/chaos.html www.digite.com 1 Copyright 2003 digité,Inc. All rights reserved.
  2. 2. diginotes Process Maturity in IT Initiatives More then 70% of all IT depatments have no organized processes to deliver software products. They depend on the heroic efforts of their development teams to try to meet delivery schedules and rarely succeed. In addition, the difference between organizations that have mature software development processes over organizations that have less mature processes is significant. Organizations with mature processes have productivity improvements of five times over organizations that don’t, and are thirty times more likely to meet schedule and cost estimates. These organizations also release software products with twenty times less defects than the average software company.2 Category Range Median Total yearly cost of SPI activities $49K - $1,202K $245,000 Years engaged in SPI 1-9 3.5 Cost of SPI per software engineer $409 - $2,004 $1,375 Productivity gain per year (LOC) 9% - 67% 35% Early detection gain per year (defects discovered pre-test) 6% - 25% 22% Yearly reduction in time to market 15% - 23% 19% Yearly reduction in post-release defect reports 10% - 94% 39% Business value of investment in SPI (value returned on each dollar invested) 4.0 - 8.8 5.0 Table 2: Benefits Derived from CMM Implementations. Source: “Benefits of CMM Based Software Process Improvement: Initial Results”, SEI, August 1994 Achieving Process Maturity The establishment of mature software development processes is currently a complex and expensive activity. Only large organizations have the resources to establish these processes. Organizations today spent considerable time and money to implement proprietary in-house processes. It takes an average of 19 months2 for an organization to move from IT development processes to one which is minimally mature and demonstrates repeatability. The average cost of such implementations exceeds $1 million. This also greatly increases the complexity of the initiative by requiring to bring in external domain experts, establishing systems, preparing operating procedures and implementing change management programs. Furthermore, there are no economies of scale associated with this endeavor. Each site requires it own infrastructure to establish a mature software development process, and a significant investment in training, tools and process conformance audits. There is also tremendous inconsistency of results from the implementation of these processes. The returns are years away and executive management have shorter-term goals to meet resulting in less than 30% of IT departments having some software process improvement (SPI) initiative. 2 Data derived from Benefits of CMM Based Software Process Improvement: Initial Results, SEI, August 1994. And Software Process Improvement, Sami Zahran, Addison Wesley, 1998, Page 393. www.digite.com 2 Copyright 2003 digité,Inc. All rights reserved.
  3. 3. diginotes Process Maturity in IT Initiatives Once a process is established, there is an additional cost to police and ensure process conformance. An additional 5–10% of the IT budget is required annually to ensure compliance to systems and procedures. Process measurement and baseline metrics are also difficult to establish and in most organizations non-existent. In addition, there is no industry baseline to contrast organizational performance with. Even though the Internet has been around for several years, most organizations have not successfully transitioned to processes that support Internet connectivity and communities. Most of today’s processes were designed to deliver client-server and legacy applications. They do not provide the flexibility to meet the rapid changing market conditions that reflect the Internet product space. The Internet development software development paradigm reflects better a “bazaar” of independent software developers working towards a common goal rather than the more rigid centralized development models that reflected in “cathedral” building.3 Our Service Offering Organizations today incur tremendous up-front costs to implement in-house processes, and the results in many cases are uneven. Our vision is simple; our customers instead of establishing their own in-house proprietary processes, become participants in an instantly available, web- hosted, best-practices based process in digité that enables accelerated software development. Digité offers a process platform and infrastructure for managing IT initiatives where users can access instant best in class processes specifically tailored for the Internet project delivery that will enable them to shorten delivery schedules, improve product quality and increase development productivity. Our process model allows organizations to achieve quality mature processes by becoming a participant in an established process rather than establishing one independently. In addition, our unique Internet process methodology caters specifically to the development of applications that feature phased rapid application development and robust test metrics. Current IT and software development processes do not meet the time to market and bulletproof quality requirements of Internet products. They were designed for long development cycles and tight centralized command and control structures reminiscent of “cathedral” building. Digité introduces the concept of instant processes that support today’s “bazaar” development methodology of rapidly changing market requirements and autonomous development teams. The object of this hosted process is to convert user requirements into software systems, based on established best practices based policies and procedures. The process ensures formal sign- offs and deliverables for each activity. Visibility within the process is available with measurement of progress and quality of deliverables. Key to our approach is the use of workflow technology to automate and coordinate the software development process. Process metrics will now be captured at the community/industry level, allowing participants to benchmark their performance with their industry peers. 3 “The Cathedral and the Bazaar”, Eric S. Raymond, www.tuxedo.org/~esr/writings/cathedral- paper.html www.digite.com 3 Copyright 2003 digité,Inc. All rights reserved.
  4. 4. diginotes Process Maturity in IT Initiatives Digité provides a significant number of the required software planning and tracking tools to fulfill the tasks within the process while at the same time allowing to participants to use their own development tools and methodologies to execute their tasks. Both organizations with and without mature processes will benefit from our hosted process service. The returns would be highest for organizations without processes. They would use our service to establish an instant mature process infrastructure. Other organizations with mature processes lower than CMM level 5 would use our hosted process to reduce their process maintenance costs, enhance existing process capability skills to higher maturity levels and baseline their process against our community metrics. Customer Promise There are three unique features that our hosted process provides. First, we provide a best in class mature process that our subscribers can become participants in rather than establish it themselves4. Our customers can focus on their core competency of product innovation while outsourcing the establishment and maintenance of processes to us. Two, the ProcessBazaarTM methodology addresses the need of organizations to respond more rapidly to unpredictable changes in market conditions or technology. Time to market is a key factor in this model, while allowing the firm to respond to market needs by including new information and changing requirements. In addition, today’s ‘bazaar’ of development resources is coordinated through a release management methodology supported by digité rather than the centralized and inflexible project management approach of cathedral building. Our customers will be able to demonstrate up to 5X in programming productivity and to increase their pre- release defect find rate from less than 50% to more than 95%. They will also be able to increase their probability of meeting their projected schedules and cost estimates from the industry average of 16.7%1 to more than 90%. Three, we provide industry baselines with which organizations can benchmark their performance against their industry peers. We provide an automated expert system to advise and explain why this capability gap exists. This allows our customers to take corrective action suggested by the system to improve their performance. References 1. The Chaos Report, 1995, The Standish Group, A copy of the report is located at www.standishgroup.com/chaos.html 2. Benefits of CMM Based Software Process Improvement: Initial Results, SEI, August 1994 3. The Euro, Y2K, and the US Software Labor Shortage, Capers Jones, IEEE Software, May/June 1999, Page 57. 4. Applied Software Measurement, Capers Jones, McGraw-Hill, 1996 5. Delphi Report 6. Software Process Improvement, Sami Zahran, Addison Wesley, 1998, Page 393 7. The Cathedral and the Bazaar, Eric S. Raymond, www.tuxedo.org/~esr/writings/cathedral- paper.html 4 The ASP model allows the customer to build the product more cheaply but not necessary a better product. Unlike the ASP model where the customer’s savings are primarily in application maintenance and support costs, the availability of mature best in class processes will for our customers impact directly their products. It will lead to shortened time to market, lower production costs, and improved product quality with ProcessBazaarTM. www.digite.com 4 Copyright 2003 digité,Inc. All rights reserved.

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