The Victory Project - A Virtual Enterprise for SPI
Dr Richard Messnarz ISCN LTD, Ireland
Dr Miklos Biro Sztaki, Hungary
Gonzalo Velasco General Fundacion, Spain
Gearoid O'Suilleabhain DEIS, Ireland
If the strategy is wrong the whole improvement is a waste. In [PICO 1999] it is described:
An example is the strategy of some Japanese firms to enter the European market, as it is perceived by the European competitors. A European firm (a radio manufacturer, also developing the software for radios) always was confirmed to produce radios which are running through extensive tests and thus have to be sold at a certain minimum price. The Japanese competitor realized that there is a market demand for different radios (at different price and quality levels) and started to develop and distribute radios also at low cost (with lower quality and functionality). However, not the quality of the system but the perceived quality from the different levels of the customers was deciding the market success, so that many customers bought the low price radios and the European radio sales became smaller. This does not mean that the Japanese firm was not offering quality, it rather means that they offered different systems with different quality levels (of curse, also including systems of the same high standard than the one offered by the European firm).
So if SPI would just try to further increase the maturity level of this European manufacturer and introduce even more processes they would fail and money would be wasted. But if they learn to tailor their standards to different quality levels of products they can compete.
If the strategy is right, and the goals are wrong the whole improvement is a waste. In [PICO 1999] it is described:
A big electronics company in Europe, for instance, made an assessment resulting in maturity levels for different areas of the organization and the identification of weaknesses such as unrealistic planning, no process for design reviews, and weak configuration management. The organization was already ISO 9001 certified but only 30% actually accepted the guidelines due to missing practicability (formally good documented but not realistic for projects in the field). A formal pragmatic assessment and improvement approach would then, for example, decide about introduction of configuration management and so forth, BUT does this really now meet the organization's business goals? Without any additional data than the normal assessment methodologies (CMM, Bootstrap, etc.) this unfortunately cannot be answered ? So this electronics company decided to run a goal analysis (based on the GQM approach) in parallel interviewing business managers, department heads, IT managers and project managers and designing a consistent goal tree from top to bottom.
One of the specific business policies was to create a financial framework for the next years which allows to get a reserve budget to fight for a brand new product on the market. To get to this marketing budget the business managers decided to stabilize the development effort from divisions at x% so that with all other overheads and cost a certain percentage is saved every year to have the budget together right at the time when the product is announced. At this moment the divisions were certainly higher than x% and the improvement actions (based on the previously identified weaknesses from the assessment) had to demonstrate after 3 years the success of achieving this business goal.
The technical staff were frightened and thought that people will be dismissed but the truth was that a proper interpretation of the business goals led to a completely different view. The business managers expected that process improvement provides a better work process and environment so that with the same staff more projects and tasks can be done and over time the development effort is stabilized at x%.
Under this perspective the 3 process weaknesses were again analyzed and further interviews showed a potential of re-use because in all systems in the sector nearly 80% of the functionality was always the same. So the improvement plan focused on an integration of design, configuration management and review of a re-use pool of these 80% functions and to reduce the development for each project to the only 20% additions, thus enhancing productivity and achieving the effort stabilization.
Now, let us assume that only a pragmatic assessment would have been performed. Three weaknesses would have been identified and without re-use orientation would have led to a pragmatic proposal to first run a pilot project to identify a configuration management system and field test it, to disseminate it to other projects, and to help making it a division wide standard. Sounds simple, BUT unfortunately the business context is lost. What then happens is that management sees additional effort, the development effort further increases, and with no vision of decrease of the development effort the business manager after 1 year (before benefits can be made visible) would really decide about things like dismissals.
So if SPI would just try to follow each time the same pragmatic steps without taking into account the specific business environment and goals it will highly likely fail.
Even if you have the best processes they can fail due to many reasons [Bestregit 99, Bestregit 2000, Hofstede 80, Osuille 2000, Siakas 95]
So knowledge and competence can be lost even if defined processes are in place and people create problems or leave the firm. In this respect the Bestregit project worked on team-work and learning concepts and [Bestregit 1999, 2000] found out that if the proper communication and team-work scenarios are in place the time to integrate new staff members can be reduced to one third of the previous time. However, this requires team-work based processes [Messnarz 99] drawing on roles and communications instead of just listing a number of process steps (as still many organisations do). A team-work view is important that people feel integrated, satisfied and understand how they can contribute to the team's success.
Also too many organisations following the pragmatic SPI approaches [MacAnAirchinnigh 1996] forget that most innovations start in the heads of single super-intelligent people, who then need much time to convince a critical mass of people, and only after this critical mass is reached the company starts to support this new line. And these innovations later form major business lines of the firm. Even if organisations then efficiently follow a people CMM approach [Ericsson 99, Curtis 95] and are not aware of the value of such extra-guys (who normally do not fit in the scheme) they will loose these innovations to the competitors.
An interesting example is that in EuroSPI 1999 there were presentations from Ericsson and Nokia. Ericsson (years ago) had a majority of the market shares on the mobile market (above 50%) and started with pragmatic CMM, and Nokia invested much in the cooperation with innovative groups in Scandinavia pushing the innovation of their products. Meanwhile Nokia just was at CMM level 1 and took large market shares while Ericsson working on standardisation and CMM schemes lost market shares. Of course, there are many outside factors that can influence such a situation, but still it sounds interesting.
Although not visible for the customers (e.g. cars) there are complex supply chains. A car manufacturer outsources the software development to a supplier who in return works with further software sharing partners and suppliers. In the Bestregit project [Bestregit 1999, Bestregit 2000] we field tested how process models and plans work in interdependent services and development. We started from the ideal model drawn and measured duration times and effort, comparing the expected duration times and effort with the actual ones. The times which were planned for interfaces with partners needed double the time expected, while all internal steps were nearly accurately estimated. And these times were due to waiting times for supplier deliveries, increasing the total time by 17% for the project. So it means that ideal process models in supplier chains will fail if the processes are not calibrated to realistic buffer times, effort and duration.
It is rather the knowledge of how the different factors influence each other in certain industrial cases which can be applied for your own organisation. This requires that an inter-disciplinary, inter-methodology access to know how is enabled that lets you search a big set of experience cases and analyse
This then requires
PICO stands for Process Improvement Combined apprOach. What makes PICO special is (in comparison to other Software Process Improvement initiatives) that [PICO 99, 2000]
This project involved 30 experts from 11 EU countries who produced:
1. Marketing and broad dissemination of a book. Available through an electronic book store on the WWW managed by the IEEE Computer Society Press. 2. Six developed one day courses which focussed on different business and success factors which are important in the implementation of software process improvement. The courses are available with trainer notes, students notes, and slides. The trainer notes allow that trainers can receive the course and hold it themselves for their staff or clients. 3. A tool set configured with the most common assessment methodologies, such as ISO 9001, CMM, Bootstrap, SPICE, and any others (if available).
Target Group:
The target group are division managers, project managers, quality managers, auditors, and consultants in the IT sector.
Bestregit stands for BEST REGIonal Technology Transfer. Bestregit developed a simple to follow approach for innovation transfer organizations to improve their innovation services and achieve the structure of a continuous learning organization. Later in the project it was found that the approach is beneficial for service organizations in general and has been field tested with service (government owned and private) organizations as well. [Bestregit 99, 2000]
Results which can be multiplied and disseminated:
1. An improvement guideline with clear guidance, steps, and examples from the user organizations and field tests, to establish an improved organizational structure with a business focus and a learning organization culture. The difference to PICO (and the usual assessment methodologies) is that Bestregit much more focuses on team and people aspects, and speaks a language which can be understood by non IT people. It is a framework that was successfully field tested with people with no IT background like sociology, business, or languages, or politics. 2. A set of case studies from the user organizations who field tested the entire guide-line and its steps and helped to refine it. We might use the measurements done in these studies for show cases and commercial argumentation. 3. An interactive course (which got very positive feedback in the field tests) which demonstrates the improvement steps, the learning organization model, and supports the participants in the application based on real examples (their own organizations).
The target group are directors from SMEs and service organizations, innovation managers, managers in government agencies, and managers in general.
Victory's goal is to
Select is a European initiative of partners of the W4Group consortium who develop new Internet protocols and services for rating and guided Web browsing. This group supports the creation of this body of knowledge by combining this large set of experience reports with rating and search services.
SPI Knowledge requires - A large set of experiences - A guidance to browse this experience and a support to select the right experience which can work for you - A guidance to combined usage of methodologies and approaches as required to satisfy all the factors (as discussed above) - An access to the different methodologies - A ready to use platform to offer SPI products and knowledge in an e-commerce environment
Figure 1 : Victory E-Commerce Architecture
A large set of experiences is represented by
A guidance to browse this experience is elaborated by the project SELECT as well as by the Victory partnership applying animated design tools.
For the selection of the right set of methodologies and experiences we follow a two-fold strategy: 1. PICO offers guidance about how to select the right methodology based on your business case (from a methodology viewpoint). 2. The Victory site will offer a search mechanism to select a set of experience reports which seem applicable for your business environment.
All relevant method providers will be linked and experience reports will be associated to them. We also will offer chat rooms on certain SPI topics and experts available at certain times.
And most important, to offer a platform concept with ready to use e-commerce components which allows EU projects and providers to insert their services and products into a e-commerce environment offering
Figure 2 : Victory - A Platform Open for Further Initiatives
If this works out this could have an impact on the EU beyond 2010 because at this stage Victory can start collecting all regional experiences and summing them into one European body of SPI knowledge.
The advantage of such a bottom up approach is that it naturally grows (like a flower) and is a step by step integration instead of a big hammer top down all-at-once initiative.
In the Bestregit project [Bestregit 1999, 2000] a learning spiral for SPI was identified which usually organizations run through when applying a combined set of SPI methodologies, and the learning phases were aligned with leverages (business levers) a business manager wants to achieve.
Figure 3 : The Learning Spiral and Business Levers
Why do managers invest into improved skills and processes ? [CapersJ 96, Herbsleb 94, Bestregit 99]
Operating leverage is related to the cost structure, that is the repartition between the fixed costs and variable costs. Process improvement means an increase in fixed costs ( training, consulting fees, equipment, improvements in office conditions, etc...) to decrease the variable cost (average effort to do a certain service at a give quality). If, due to process improvement, the firm is able to deliver the same quantity and better quality of service using less person months than earlier, then it will have the potential to take advantage of operating leverage. Learning Leverage - It is an empirical fact that unit costs decline exponentially when experiences are accumulated and the steady reuse of these experiences is well managed by the firm. This is called production leverage in the manufacturing industry, while learning leverage is a better expression in the service sector. Marketing Leverage - Process improvement, maturity achievement, ISO 9000 certification have an important impact on the perceived capability of the company and on the perceived value of its products or services, which contributes to improved customer satisfaction. Human Leverage - It is widely known that employee motivation (empowerment) can be significantly influenced by immaterial means like management styles and organizational structures. This means that the same employees can perform more work and even in better quality than otherwise. Financial leverage means borrowing funds and investing them with a return higher than the cost of the debt. If a company is able to exploit financial leverage, it can make money on funds it does not own.
If organizations apply a combined set of methodologies as described in the PICO materials (for software organizations) and in the Bestregit materials (for service organizations) they usually
If the SPI body of knowledge offers a set of different methodologies and provides guidance about how to establish a combined set serving your goals best this learning spiral of firms should be represented in the learning model offered to the users.
These users then connect the general Victory site (with experience from different partnerships, sources, countries) and use the experience library, the method and tool sets offered, together with the guidance o follow his specific learning spiral.
Figure 4 : A General Victory Architecture
As Leonardo focuses on a Long Life Learning Europe the initiative will support a long life learning process for SMEs across Europe in the SPI sector.
[Bestregit 99] A Learning Organisation Approach for Process Improvement in the Service Sector , R. Messnarz. C. Stöckler, G. Velasco, G. O'Suilleabhain, A Learning Organisation Approach for Process Improvement in the Service Sector
[Bestregit 2000] The Bestregit Improvement Guideline - Learning to Improve, Bestregit Final Report, CEC-Leonardo da Vinci Programme, April 2000
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