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As anyone is aware, many software development projects suffer from time over-runs, poor quality, over promising and under delivering.

 

Successive Standish chaos reports have confirmed this, and their latest report shows that we’re back to where we were in the mid 1990’s. Yet, in 1992, the Capability Maturity Model (CMMI) research established the processes and practices which, when adopted, measurably reduce uncertainties, and maximise output for available money.

 

Applying the right process improvements saves money

Based on conservative estimates, applying a CMMI level 3 compliant software development process yields an ROI multiplier of 4 to 25 times, depending on your implementation choice.

 

For example, consider a 100 staff IT development unit of $8 Million staff costs. Such a unit can realistically deliver $1.75M more value to the business over a period of three years, for the same amount of effort. For an investment of $70-80K would you like to get $1750K back?

 

The cost break-even point is at about 10 people, so at 15 or more you definitely win.

Benefits are greater than just money

By operating at CMMI level 2 or 3 you’ll deliver a consistent customer experience, get on top of quality, and you’ll have a much happier client base. 

 

Or, if you are selecting a vendor, a CMMI level 3 vendor will provide you a much higher probability that things will get done on time, to cost, as promised and agreed, than if you select a CMMI level 1 vendor. So when selecting a vendor how realistic is the lowest price?!

 

Why does capability maturity deliver these benefits?

The Capability Maturity Model (CMM) research established the processes and practices which, when applied, measurably reduce uncertainties, minimise wastage, and maximise output for available money.

 

In other words, through research (rather than opinion) they identified those processes and practices which are key to achieving a distinctive stepped-up performance in terms of time and cost. And the most important finding? That the CMMI groupings of processes and practices, defined for each capability maturity level, directly equate to a stepped‑up improvement in time / cost performance.

Nice in theory, but in practice?

Smartmatix staff have been in the fortunate position to have set-up and run the program and project office for Telecom NZ and NZ Post. Thus we gained our own data on some $400 Million worth of projects. By measuring project results in the context of applied capability maturity, we are but another organization who can confirm the CMMI findings.

Truly, what makes the difference?

Based on our data, here are the top three observations on what makes a measurable difference in project performance:

       Governance (if the sponsors and owners are in disarray, guess what happens?).
Note that this is not fully covered by the CMMI, but is by for example Cobit, which includes the CMMI maturity approach.

       Scope management – all projects that apply the basic principles of requirements management (scope management), project planning, monitoring and control, and configuration management (CMMI level 2 capabilities) fare significantly better time / cost / satisfaction-wise, than those that don’t, or only partially do.

       Communications - re requirements, risks, progress tracking, verification and validation (level 3 capabilities)

 

Any other findings of interest?

       The biggest hurdle to ensuring process improvement lasts is the ICT organizational model and lack of induction training.

       Design is indeed a level 3 capability, and only really pays-off once level 2 capabilities of requirements management, project planning, monitoring and control, configuration management etc. are in place.

Need to know more?

For an in-depth discussion, please read the CMMI explained pages, or get the white paper business case for adopting a CMMI level 3 compliant process from the downloads page. Or, if you’d like to discuss your organizational, induction training, or improvement or other needs, please contact us.

 

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Site Software v2.2.0, 26 Oct 2016