Mastering Current Global Software Development Challenges

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  • 1. Mastering Current GSD Challenges Assoc. Prof. Dr. Michael Heiss Global Vice President for Knowledge, Innovation & Technology Siemens IT Solutions and Services © Siemens AG Austria 2009. All rights reserved.
  • 2. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 3. Cost pressure – the main driver for GSD  During the last years the cost pressure for offering IT services and software development has been increasing steadily  This holds true for many other businesses, too, if the work is easily transportable  Software business is people intensive  The reduction of hourly rates is the key argument for CFOs  This is often seen like a natural law of globalization Page 3 © Siemens AG Austria 2009. All rights reserved.
  • 4. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 5. A pragmatic definition of complexity We call a technical system complex (in contrast to complicated), if it is impossible to predict the behaviour of the whole system, even if you know exactly how each of the system components behave and interact. Page 5 © Siemens AG Austria 2009. All rights reserved.
  • 6. Just a simple example for complexity System 1 1 x Delay y 0,8 3 very simple elements Ausganswert 0,6 one step 0,4 0,2 3 simple behaviors 0 0 1 2 3 4 5 6 7 8 9 Takt “perfectly predictable” System 2 0,2 x y Ausganswert y = x - x² 0,15 0,1 0,05 0 0 1 2 3 4 5 6 7 8 9 Takt x(t=0..4) = 0,8 x(t > 4) = 0,1 System 3 x y 4 Ausganswert 3 y = 3,8x 2 1 0 0 1 2 3 4 5 6 7 8 9 Takt Page 6 © Siemens AG Austria 2009. All rights reserved.
  • 7. Just a simple example Complexity is generated Delay by interaction one step y1 x = y3 x = y1 y3 y2 x = y2 y = x - x² y = 3,8x Page 7 © Siemens AG Austria 2009. All rights reserved.
  • 8. Just a simple example … ??? Complexity is generated by interaction. The result is… 1 0,9 0,8 0,7 0,6 Ausgangswert 0,5 0,4 0,3 0,2 Even the best supercomputer of the world cannot predict more than 300 steps 0,1 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 y1 full precision volle Genauigkeit y1 limited precision auf drei Kommastellen Time steps Takt Page 8 © Siemens AG Austria 2009. All rights reserved.
  • 9. A typical real-life software example: the high number of interactions leads to high complexity In a real world software system the number of elements, interactions and dependencies is far larger than in the simple “toy” examples, e.g.:  integration in legacy systems,  interoperability with additional IT systems Example: Intelligent Networks service platform for telecom systems (more than 100 customers worldwide) Page 9 © Siemens AG Austria 2009. All rights reserved.
  • 10. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 11. Organizations are changing rapidly: new ways of global cooperation are opened “The only constant is change”  Mergers and acquisitions,  Reorganization of companies  High turnover rates in many low-cost countries Interesting new perspectives such as  “Project companies”  Open innovation  Crowd sourcing Page 11 © Siemens AG Austria 2009. All rights reserved.
  • 12. The challenge of „project companies“: working with the unknown project company 1 company company 2 Survival of the fittest Evolutionary approach: small company mutation, recombination, selection Page 12 © Siemens AG Austria 2009. All rights reserved.
  • 13. Open Innovation: Suggestion for a change in cooperation models Paradigm shift of Open Innovation1) The lab is The world Strategic opening of innovation is our lab our world Closed innovation Principles Open innovation Principles • The smart people in our field work for us. • Not all the smart people work for us. We need to work with smart people inside and outside our company. • To profit from research and development (R&D), we • External R&D can create significant value; internal R&D must discover it, develop it and ship it ourselves. is needed to claim some portion of that value. • If we create the most and the best ideas in the industry, • If we make the best use of internal and external ideas, we we will win. will win. • We should control our innovation process, so that our • We should profit from others' use of our innovation competitors don't profit from our ideas. process, and we should buy others' intellectual property (IP) 1) Chesbrough, H. (2003), "Open Innovation: The New Imperative for Creating and Profiting from Technology“, Harvard Business School Press Page 13 © Siemens AG Austria 2009. All rights reserved.
  • 14. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 15. The GSD-dilemma for high-cost countries customer needs, global competition integration in existing systems global competition GSD cooperating with unknown Increasing Increasing Increasing cost pressure complexity volatility only the best Higher complexity leads to higher costs Page 15 © Siemens AG Austria 2009. All rights reserved.
  • 16. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 17. How to reduce the offshoring cost barrier: Invest in communication and collaboration! Communication Challenges Offshoring Cost Barrier Cost Ctotal = Cop + Cdistr 100% Cop, HC Cop 100% Cop, LC Cdistr Cdistr,mature Cdistr = Cdistr,mature Collaboration Maturity 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Collaboration Source: S. Lasser, M. Heiss, Proc. of IEEE IPCC, 2005 Model low collaboration maturity  high distribution cost  high offshoring cost barrier The higher the communication maturity the lower the distribution costs new tendency inverse offshoring model Source: Proceedings of the IEEE International Professional Communication Conference (IPCC 2005); ISBN: 0-7803-9028-8 Limerick, Ireland, 10-13 July 2005, Thread: Engineering Management, pp. 718-728. Page 17 © Siemens AG Austria 2009. All rights reserved.
  • 18. Project Communication: proven “old” practice  Kickoff meetings are worth the investment (also in times of travel restrictions) – team members should meet at least once personally.  You have to deal with emotions on both sides:  “Am I supposed to help outsource my own work?”  “Why do we get only the boring stuff and little information?”  To achieve a high collaboration maturity for distributed teams requires trust and months / years of working together  The main drivers for collaboration maturity: Processes, communication and tools. Page 18 © Siemens AG Austria 2009. All rights reserved.
  • 19. As trust increases the productivity of GSD, staffing of GSD teams needs human intelligence  Where can I find the available people with the right skills at the right time for a low hourly rate?  Up-to-date company-wide data bases with skills profiles are desired (in middle Europe opposed by workers´ councils)  Such data-based people search seems to work already well for consultants (individual experts working loosely together)  In our experience the data-based approach does not work well for staffing of GSD teams (continuity, skills level, soft factors,...)  Challenges: Management of teams, locations, multi project management Page 19 © Siemens AG Austria 2009. All rights reserved.
  • 20. Project Communication: new media help a lot to overcome barriers and improve productivity Scenario: distributed collaboration in development project with 17 team members at 3 sites (Project Management, Integration and Development in Vienna, Bratislava, Cluj) New communication media (Microsoft OCS) encouraged people to change the communication processes so that the desired increase of productivity was reached. Changes: OCS incl. Video, number of meetings, organizational change (meeting culture), more conscious choice of synchronous or asynchronous media (task/media fit: ambiguity vs. uncertainty) Improvements:  Reduction of response time  Reduction of solution time (due to „Presence Service“ and “Instant Messaging” more awareness about the work of other team members)  Increase of productivity of the team members  Information Sharing  Transparency about the process improvement More details in the presentation by Daniela Damian and others this afternoon! Page 20 © Siemens AG Austria 2009. All rights reserved.
  • 21. Robust project communication in natural language is a key factor – “English as a lingua franca”  In GSD projects people with different mother tongues and different cultural backgrounds are working together  In our projects almost nobody speaks English as a mother tongue, but everybody has to communicate in English  This topic is in our experience underestimated in the scientific discourse about GSD  Most prominent challenges for the robustness of communication:  Requirements engineering  Project management, meetings and meeting minutes  Inquiry culture in daily work More details in the presentation of Benedikt Lutz this afternoon Page 21 © Siemens AG Austria 2009. All rights reserved.
  • 22. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 23. Knowledge Networking across the organization is not just a vision: it already works today Example: Social Network Analysis Siemens IT Solutions and Services, System Design and Engineering „Who has helped you in your professional work during the last 12 months“ Page 23 © Siemens AG Austria 2009. All rights reserved.
  • 24. Technoweb – company wide knowledge networking identify implicit knowledge via the activity stream of the appropriate expert higher business value lower business value higher accessibility Internet, publications visible Blogs, Microblogs, Wikis, CRM, CM, Intranet DIGITIZED limited Proj. E-mails access pers. Desktop data pers. E-mails privacy Voice NON DIGITIZED lower accessibility Face 2 Face identifiable not visible Brain activity stream Page 24 © Siemens AG Austria 2009. All rights reserved.
  • 25. Knowledge networking has a business impact on the project performance and the speed of new technology adoption 10 years of  start small and evolve continuously (business demand driven) experience with  Hold barriers low for participation TechnoWeb  Balanced bottom up / top down approach Key aspects of SIS TechnoWeb  Networks related to technology  Focus on networks of experts  Open for all employees  Very low cost of operation Facts of TechnoWeb Business impact  534 knowledge networks  8072 members  Trend setting: 31.6 % of TW members are already in  634 technologies SIS top priority trends (analysis FY08)  3366 network services  Early/fast identification: Significant Improvement  38 countries regarding availability/visibility of new technologies Examples for knowledge networks within  Innovation: TechnoWeb members have a 7 times TechnoWeb: RFID, Green IT, Car-2-X, higher probability of a successful innovation idea. Security, DEMS, Architecture, Remote Service,  Cost reduction: 0‘4 Mio € in FY2008 could be saved Modeling, Semantic Systems only by the TechnoWeb urgent requests Page 25 © Siemens AG Austria 2009. All rights reserved.
  • 26. TechnoWeb 2.0 provides a globally integrated “Dashboard" for technology workers The Siemens Technology Network Dashboard Rating of network automatically activity emerging structure Techno Web 2.0 Short description of technology/topic Topics that are related to network rating + Partner Networks Incorporated Fast Technology Search Links & references to related content Communities with related Services and Network services/references topics experiences provided by the network on n t. ing ps on g t s re . k t t tio ac t ac t an t ac er t t t hin ac cts ac ing a ti ac es ac ac ac ac ho a ti ols atu ult ca Pr r tn s tr ell str str s tr str orm lpd str s tr s tr ac str oje ks alu ain ns To pli er Pa sc Ab st Ab Ab Ab Ab Co Ab Ab or Ab Ab He Co Pr Tr Ev Lit Ap Be Inf Mi W Members Member network members / communication experts. Links to personal page Page 26 © Siemens AG Austria 2009. All rights reserved.
  • 27. Microblogging: the simulated open-plan office Microblogging... • supports the private/collaboration/social aspect (important for globally distributed teams) • helps to separate the business stream (mailbox) from the knowledge stream (twitter): the business stream needs 100% to be read, elements of knowledge stream: only if the subject looks interesting / you have time • increases the communication frequency compared to full blogs barrier much lower (less time required) • A typical use case for professional users is to use twitter as a dynamic social bookmarking tool • generates a digital activity stream which helps to identify implicit knowledge of experts Page 27 © Siemens AG Austria 2009. All rights reserved.
  • 28. Microblogging: lower barrier, higher frequency, and social relationship publishing continuous 140 letters search on Cappuccino law: “Enterprise messages 80% coffee and 2.0“ retweeting incl. link 20% foam interesting messages continuous non-public following search on replies interesting “Open persons Innovation” 25 25 20 20 15 15 Number of Enterprise 2.0 tweets 10 10 on June 11, 2009 5 5 0 0 00:00 04:00 08:00 12:00 16:00 20:00 24:00 1 2 3 4 5 6 7 8 9 10 11 12 13 Page 28 © Siemens AG Austria 2009. All rights reserved.
  • 29. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity
  • 30. Be an expert in managing complexity Topics of our recent study:  Detecting complexity in the problem space vs. reducing it in the solution space  Usability Engineering: Prototyping, Standardization  Patterns in SW Architecture  Architectural tactics  Organizational patterns  Metrics as useful indicators  Responsibilities  Agile development practices  Safety nets: robust systems, self healing systems  Test driven development  Impact analyses Source: M. Heiss, St. Huber, B. Lutz, M. Arnhof: „Management of Complexity“, presented at the MIT-Europe conference on March 25, 2009 Page 30 © Siemens AG Austria 2009. All rights reserved.
  • 31. Agenda  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity  Conclusion
  • 32. Conculsion: measures to cope with the GSD-dilemma customer needs, global competition integration in existing systems global competition GSD cooperating with unknown Increasing Increasing Increasing cost pressure complexity volatility only the best higher complexity leads to higher costs  Increase the communication maturity (incl. new technologies)  Increase the knowledge networking maturity  Increase the maturity in managing complexity Page 32 © Siemens AG Austria 2009. All rights reserved.
  • 33. Thank you for your attention! Assoc. Prof. Dr. Michael Heiss Global Vice President for Knowledge, Innovation and Technology Siemens AG Österreich Siemens IT Solutions and Services Gudrunstraße 11 1100 Vienna Austria Phone +43-5-1707-46560 Fax +43-5-1707-56591 Mobile +43-664-8855 1526 mailto:michael.heiss@siemens.com Blog: http://twitter.com/heisss Fotos: http://www.flickr.com/groups/visualization/ Slides: http://www.slideshare.net/heisss Page 33 © Siemens AG Austria 2009. All rights reserved.
  • 34. Appendix  Top 3 challenges for GSD in our business  Increasing cost pressure  Increasing complexity of projects  Increasing volatility of organizations  Some of our experiences in coping with these challenges  Project communication using „old“ and „new“ media  Knowledge networking within and outside the company  Management of complexity  Conclusion  Appendix
  • 35. The Agile Software Development paradigm Heavy team – light methodology, high productivity  Less documentation – personal communication is getting more important (difficult for dislocated teams)  Product owner: direct customer involvement (the biggest challenge for dislocated teams)  Beware of “daily SCRUM” phone conferences at midnight!  Our experience for success: local customer proxy, stable structures of teams, knowing the partners personally Source: Siemens IT Solutions and Services Page 35 SDE System AG Austria 2009. AllSEM reserved. © Siemens Engineering Method rights
  • 36. Balance between local and global responsibilities  In our experience, a balanced approach of global and local responsibilities on project and organization level is the key for success  Organizational patterns of best practice are a good guide  Many patterns are grounded in “soft topics”  see e.g. our “Project Insights” or the recent “Adrenalin Junkies” of the Atlantic Systems Guild Page 36 © Siemens AG Austria 2009. All rights reserved.
  • 37. Cross project communication: Knowledge networking  TechnoWeb: A knowledge networking tool (“Know-who database” instead of Know-how databases), urgent request mechanism  Internal consultancy centers (“Support Centers”) – the first three hours of effort for free!  Learning Network – internal training for own technology and methodology topics: Standard -> customized -> consultancy -> work in project Page 37 © Siemens AG Austria 2009. All rights reserved.
  • 38. Example: discovering the blog post of Prof. McAfee (Harvard University) in less than 2 hours after he published it June 10, 2009: 18:13 McAfee, Boston 18:19 RT New Jersey 2.0: Technology is used to broadcast information 18:29 RT Canada publicly to people both known and unknown 18:46 RT Singapore 19:01 RT San Francisco 1.0: Technology is used to transmit information 25 19:10 RT Stuttgart 20 privately to known people 19:30 RT Washington 15 Example from McAfee‘s blog at 10 20:08 RT Vienna 5 http://andrewmcafee.org/blog/?p=871 20:25 RT Hawaii 0 RT…retweet Page 38 00:00 04:00 08:00 12:00 16:00 20:00 24:00 © Siemens AG Austria 2009. All rights reserved.