Change Management


We’ve been doing some work for an organisation – one that achieved CMMI Level 3 in the past.  They wished to re-appraise and understandably thought “how hard can that be”?

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We were discussing one of our customers the other day – large, complex and been pursuing CMMI for a while now (not much new there then).  Their main motivation is simply “it’s a good thing to do” – as a result progress is slow because there are no compelling business drivers.  In this situation, CMMI is seen as a quality thing – laudable but dull.  How to spice it up?  How to get senior management interested?  How to inject some energy and ensure benefits happen now not years down the line on someone else’s watch?

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08:00hrs

Well, we made it safely and I have been positioned on the stand, ready to catch delegate’s eyes. Thank goodness I’m out of that horrid box, it was very crowded.

It’s a real honour and adventure to be here – no-other Lamri Pigs have ever done the ITSMF conference before, and it’s a first for my handler, Maria as well.

I know she’s a bit nervous; I overheard her talking to her colleague Chris. CMMI-SVC is often seen as an alternative or hindrance to ITIL and they’re here to promote its value as a complimentary value-add tool for companies offering Services.

Maria thinks people might be sceptical, or even a bit hostile as to its presence at the conference.  I heard her say that for a while she too was unsure as to how it supplemented or complimented existing recognised frameworks like ITIL.  Then she supplemented her experience in ITSM and formalised her knowledge of ISO20K by taking her consultants exam in the summer and became a “believer “!  (more…)

Money talks – CMMI what’s the connection?

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One FTE has become one of my favorite websites recently, I am also a Dilbert fan but these just seem to be that little more cutting!  This caught my eye…….don’t forget Talent isn’t optional. (more…)

I have mentioned in previous blogs that I travel a lot.  For the most part journeys are simple straight forward affairs, cruising along at 70mph with little or no disruption. However following last years winter the road system needed a large amount of maintenance, with large wheel bending potholes causing many journeys to end in financial disaster as cars were damaged, some to the point where they could no longer continue on their way. Enter every drivers worst nightmare, the traffic cone. (more…)

In my opinion it is to make IT boring – create a no surprises culture.  Directors and senior managers are looking more and more at the pivotal role that IT has to play to enable growth and reduce costs within the business.  This evolution is unlike anything IT Leaders have experienced in the past.  Weathering the current storm will require IT Leaders to support new business processes that increase profits and enhance revenue, whilst controlling their own costs and improving their own performance.

In this new environment all the old challenges still remain: strategic alignment, governance, performance and operational risk.  However a critical need is to create a “no surprises culture” where the current often “exciting and bumpy” IT delivery ride becomes the exception not the norm.  However, there are serious doubts that IT departments can make the necessary changes to deliver on this promise.  A recent study by Forrester Research highlighted that: only 28% of CEO’s characterised IT as offering proactive leadership; 34% portrayed IT’s role as poor or mediocre and 24% characterised IT as innovating only when under pressure (Source: Closing the CEO-CIO Gap, Forrester Research).

Over recent years it has also become increasingly apparent that IT Leaders can make a serious contribution to the good health of a business.  This has ensured that the market imperative for pursuing improvement is very strong.  A study by Keystone Strategy, Harvard Business School and Microsoft found that companies with superior IT grew faster than their peers.

ITSCORE.001.jpg

Concentrating on cost alone will not deliver better performance.  Providing a sub-optimal service for less will increase organisational stress with no extra end-user benefit.  Achieving more but without having to demand more is the new focus.  In this environment increasing the rate at which work is delivered on time and on budget, ensuring that there are no material service disruptions or critical outages and increasing the speed that new business requirements can be sustained are all very immediate goals for every IT function.

Beating This Challenge Is Possible. British Telecom Defence Fixed Telecommunications Service (BT DFTS) focused their IT improvement journey on creating a culture of rigorous and disciplined execution and this transformed their operational capability.  Within a 12 month period they were delivering 60% more change whilst increasing customer satisfaction by 30% with 22% less staff.  (Source: The DFTS journey 1 year on, BT DFTS).  In recent years Accenture have also transformed their own systems delivery capability by championing the use of software engineering best practices and rigorous operational discipline to improve predictability and reduce project failure costs.  Over a 24 month period predictability improved by over 200%, poor delivery costs were reduced by nearly a third and the number of large unpredicted failures shrunk to almost zero.

Delivering this level of transformational improvement is a step change event that systemically and enduringly improves the performance of IT.  It is atypical of the change projects that are generally run and success requires strong and consistent leadership, alignment with strategic goals and a clear business case.  The gains that can be achieved by this in the real world are impressive.

Interestingly it is CMMI which was the enabler in both BT DFTS and Accenture – perhaps it should be on your agenda for 2011.

Writing in the July-August 2010 Harvard Business Review, Roger Martin described successful strategy implementation as a ‘white-water river’ where ‘those in charge make broader and more abstract “upstream” choices, and employees downstream are empowered to make choices that best fit the situation at hand’.

This metaphor is pertinent to operational performance improvement.    Without clear and unambiguous direction from top management, nothing will happen.  However, it is only at working level that the particular challenges associated with establishing a new management system, process or tool can be navigated.

Too often I see process improvement programmes without forceful direction (extending Mr Martin’s analogy, these are akin to backwaters that meander for a while before drying up) or where all the implementation details are centrally planned from within the programme, meaning that there is little chance of the programme navigating the operational terrain successfully.

Many organisations are restructuring or downsizing.  Some people thrive on this:

  • New top managers.
  • Middle managers who find relevance “helping our people through the change”.
  • The workshy who find space to hide.

Restructure often leaves things different, not better. Perhaps this is part of the attraction – one can’t expect improved performance too soon – the change must “bed in”.

Organisations have been doing this kind of fundamental change regularly since the 1980s. It has become a way of life.

Do you work in an organisation that must cut its cost base or do more for the same cost?  Let people know there is an alternative to the big restructure – it’s radical because it happens so rarely: make your existing assets work. Get the return on your previous expensive change programmes.  Do what you think you have been doing.

Organisations have invested millions of pounds of their capital buying tools or developing processes. The processes are not used so no return is being achieved on that investment. These organisations are ripe for “make it work” change.

As process is made to work, useless process is managed out. Smarter work practices are brought in. Practice and process become more effective together. Often organisations redesign process to become more theoretically effective but because no one follows the process it’s throwing good money after bad. Compliance is unsexy; but it’s prerequisite of effectiveness.

“Make it work” change is not traditional continuous improvement. It’s differentiated by being a finite task. There is an end point when the process will be working. That should be soon.  Consequently, “making it work” is managed more aggressively than continuous improvement. It should be managed as closely as restructuring.

“Make it work” change is not confined to process. It can apply to human assets (employees to us). When I was a permanent employee, each new CIO would start his tenure with a restructure. One CIO took the novel approach of confirming that the existing structure remained in place… but everyone had to deliver more effectively in their roles. People left. A very few were managed out through performance management. A few jumped before they were pushed. More found roles that better fitted them. Has he restructured on arrival, the organisation would have lost a different group of people. It’s not really different to managing out ineffective process through experience rather than through a theoretical idea of what will be better.

A number of weeks ago I wrote about the potential cumulative benefits of CMMI being 68 billion dollars (link) and today I found myself trawling through an SEI report and a couple of end user presentations (BT and Thales) where benefits are mentioned.  The purpose of my trawl was to find some numbers which were believable and the stories around them had a good context.  One of my personal favorite organisations for this data in the past has been Accenture, but somehow people don’t relate to information about them.

From the SEI report there is the excellent chart relating to General Motors (see section 4.2.3).   “General Motors organizations met their schedules more consistently when they made the transition to CMMI models. The number of project milestones met increased from about 50 percent to about 85 percent. Similarly, they reduced the average number of days late, from more than 50 to fewer than 10.  Notice that the major shift in both charts—most noticeable in the second—occurs after they shifted to using CMMI models”

I spoke to my colleague Graham Dick about General Motors and they are, despite the publicised issues facing them, committed to the use of CMMI.  Graham was recently exploring benefits information and he spoke to Rich Frost Global Director Systems Development from General Motors he said some interesting things

“We need to be the best customer we can be in the face of massive outsourcing, CMMI-ACQ is our tool of choice to address this need”

“Indeed 80% of projects are on time and there are very very few flagship projects that fail”

BT DFTS invested in CMMI and ran a programme to achieve CMMI ML3 which has it’s investment severely curtailed at the start of the recession (like most improvement initiatives).  The last year figures relate to the benefits they achieved within one year of starting this programme, this years figures are what they have achieved given a limited investment.

Benefit Last Year This Year
Customer Satisfaction 33% Improvement Maintained last years figures
Efficiency 60% more changes delivered Same number of changes using less staff.  Accurate measures now in place.
Cost Forecasting Variance greatly improved Cost forecasting now tightly managed through sales cycle governance
Schedule Now being measured Level 1 Schedule shows a great improvement in delivery v’s forecast
Reduce NSNP (payments for failed services) Too early to report Service Delivery failures have reduced by 30% due to improvements in process (and process adherence)

Part of Thales UK had some great results too:

2009 Outcomes

  • Identified some £1.54M savings/cost avoidance with £950k in year realisable
  • CoNQ within the Thales 2011 target (2% of sales)
  • On-time: Production was 80% ended at 94%
  • On-time: Dev was 75% ended at 82%
  • On-time: Services was 88% ended at 96%

Chris Webb, the Improvement Director responsible, makes some excellent points.  Not least of which that it is hard to really know where you get the actual benefits from.  He sums this up in his presentation by asking did CMMI deliver this? and answering no!  The real point is CMMI is a great supporter and facilitator but other things come into play too.

It’s great to see people reporting real benefits which make a difference to their businesses, if anyone has any more good stories please share them here.  Also, if you like a bit of limelight could I recommend you contact us about presenting at CMMI made Practical next year.

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