Webinar: The Business Case for Software Process Improvement

December 2, 200911:00 am

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Allen Bennett

Process Improvement Consultant

albennett@mchsi.com

Michael Milutis

Director of Marketing

Computer Aid, Inc. (CAI)

Michael_milutis@compaid.com

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About Computer Aid, Inc. (CAI)

• CAI is a global IT outsourcing firm currently managing active engagements with over 100 Fortune 1,000 companies and government agencies around the world.

• CAI is a leader in IT Best Practices for legacy support and new development application management.

• CAI’s focus is directed toward practical implementations that track and measure the right activities in software activity management

• CAI consistently promises and delivers double digit productivity in its outsourcing and consulting engagements.

• CAI makes all of this possible through the use of:• Standard processes• Management by metrics• SLA compliance management• Detailed cost, resource, and time tracking• Capacity management • Standard estimation• A unique, metrics based methodology along with a proprietary, real time data repository and

management system (TRACER®).

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PDU Credits For This Webinar

• The Project Management Institute’s ISSIG group has accredited this webinar with PDUs

• Stay tuned! Your PDU code will be displayed at the conclusion of this webinar.

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Agenda

• Improvement Experiences

• Building a business case

• The industry data

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One Of Our Divisions

• Space Borne Payloads

• Wireless Communications

• Network Solutions

• Embedded Real Time Software

• Approximately 170 Software Engineers in multiple locations

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Why Improve?

• Corporate Challenges

• Customer Demand

• Competitive Pressures

• Internal Pride

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8 Stages - John P. Kotter Leading Change

• 1 Establishing a sense of urgency

• 2 Creating a guiding coalition

• 3 Developing a vision and strategy

• 4 Communicating the change vision

• 5 Empowering for broad based action

• 6 Generating short term wins

• 7 Consolidating gains and producing more change

• 8 Anchoring the new approaches in the culture

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Changes Implemented

• Documented standard processes

• Integrated teams

• Structured peer reviews

• Milestone gate reviews

• Model based development practices

• SW CMM Level 3

Systems and Software CMMI Level 3 recently added

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Improvement Realized

00.5

11.5

22.5

33.5

44.5

5

Y1 Y2 Y3 Y4 Y5 Y6

Relative KLOCof EmbeddedSoftware perstaff hour

0

2

4

6

8

10

12

14

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Y0 Y1 Y2 Y3 Y4 Y5

Relative # Defects

Software Productivity Software Quality

0

10

20

30

40

50

60

Y0 Y1 Y2 Y3 Y4

# months to 90%Production Yield

Hardware DevelopmentTime to market

12Use or disclosure of this information is subject to the restrictions on the Title Page of this document.

Building A Business Case

• Define a tangible problem

• Understand the investment

• Predict the returns

• Prototype the solution

• Deploy through out the organization

• Measure the results

• Repeat steps 1-6 on the next problem

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Speak The CFO’s Language

Return on investment ratio

investment ofCost investment ofCost -Return

ROI

or

Return :: Cost of investment

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How Much Will Improvement Cost?

• Organizations dedicate from 2 - 6% of the Engineering Staff to process improvement and deployment activities.

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Business Case Results

From 25 organizations using CMMI, reporting percentage over time

Source: SEI/CMU Results reported as of December 2005

Improvements

High Point

Median Point

Low Point # data Points

Cost 87% 20% 3% 21Schedule 90% 37% 2% 19Productivity 255% 62% 9% 17Quality 132% 50% 7% 20Customer Satisfaction

55% 14% -4% 6

ROI 27.7:1 4.7:1 2:1 16

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Too Much Overhead To Do CMMI?

• Lockheed Martin Integrated Systems and Solutions reported a 15% reduction in overhead in moving from SW-CMM Level 3 to CMMI Level 5 from 1993 to 2003 at the same time demonstrating a 40% increase in productivity*

• *SoftwareTech News March 2007

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Improved Schedule Performance

• 50% reduction in release turnaround time (Boeing, Australia)1

• Increased the percentage of milestones met from 50% to Approx. 95% (General Motors) 2

• Decrease avg. number of days late from 50 to fewer than 10 (General Motors) 2

• Increased through-put resulting in more releases per year (JP Morgan) 1

1 Performance Results of CMMI Based Process Improvements, Gibson, Goldenson, and Kost, SEI Technical Report CMU/SEi-2006-TR-0042 Camping on a Seesaw: GM’s IS&S Process Improvement Approach. Hoffman, Moore and Schatz SEPG 2003

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Intangible Benefits Of Process Improvement

• At Ogden Air Logistics Center – Crosstalk, May 1999• Positive influence on working environment• Beneficial structure provided to the development process• Fewer surprises and last-minute glitches• Better quality software; overtime and unhappy customers reduced

• At Boeing Space Transportation Systems – IEEE Software, Oct 1999• Employee Satisfaction up from 74% to 96%• Employees motivated to eliminate defects, improve quality

• At SSC San Diego – Costs and Benefits of SPI, Karen D. Prenger• Better management control over project, team communication• Better overall performance of the software• Improved morale of team, less overtime, absenteeism• Increased competitive advantage and repeat business

• At multiple sites – DACS: Business Case for SPI Revised• Improved customer satisfaction• Improved professional staff

Source SEPG 2005: Special Intelligence from the Women in Black

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DACS ROI Dashboard• The ROI Dashboard© augments and updates the DACS Report "A Business Case for

Software Process Improvement" with the latest published data on benefits.

http://www.thedacs.com/databases/roi/

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Improving 1 Practice At A Time

http://www.thedacs.com/databases/roi/

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DACS ROI Dashboard

http://www.thedacs.com/databases/roi/

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Questions?

Your PDU CODE: S010-ITMPI0xxxx

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Software Best Practices Conferences Around The World

WWW.ITMPI.ORG / EVENTS

Sep. 22 Chicago, ILSep. 29 New York, NYOct. 1 Toronto, ONOct. 6 Baltimore, MDOct. 20 Philadelphia, PAOct. 27 Washington DCOct. 29 San Antonio, TXNov. 10 Princeton, NJNov. 17 Ft. Lauderdale, FLDec. 10 Philadelphia, PA

Fall 2009

Feb. 9 New Orleans, LA

Feb. 23 Tampa, FL

Mar. 11 Miami, FL

Mar. 23 Philadelphia, PA

Apr. 8 Orlando, FL

Apr. 20 Detroit, MI

May 4 Trenton, NJ

Jun. 22 Olympia, WA

Spring 2010

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Michael MilutisDirector of Marketing

Computer Aid, Inc. (CAI)

Michael_milutis@compaid.com

Allen BennettProcess Improvement Consultant

SEI Authorized Lead Appraiser

albennett@mchsi.com

260 249-7884