Why process standardization is required?
- Vijay Sakorikar
- Mar 17, 2018
- 3 min read
According to McKinsey & Company, anything an organization does well that drives meaningful business result is the capability. For 90% of the organization, developing capability has remained successful management strategy and one of the top 10 priority.
Building the capability to improve efficiency and effectiveness in the development process is the key to success in any industry.
The current trends in the software industry point to the fact that the product and services are no longer a differentiator. It is the business process that is becoming the key differentiation between a good software company and a bad one. If processes are identical to the company, it is easy to identify which department or project is doing better and which ones need improvement. Many organization collects data but analysis of this data to calculate various matrix against goal is very important to set improvement criteria.
Honeywell, a CMMi level 5 company, is one of the biggest companies in the world. This company is at peak of processes. They developed their own process model called Honeywell Operating Systems (HOS). This is the combination of CMMi processes, ISO, Six Sigma, Agile, Kaizen, Kanban etc. HOS is followed across the organization. They have a big team with the proper hierarchy for ensuring that the projects and all departments are following HOS processes. Many other companies, like KPIT, TechM, Infosys, the company has own/COTS quality management tool to streamline the processes. Third party project management applications are also available in market on feature-based license cost,
CMMi claims and other CMMi level 5 companies agree that implementing CMMi saves the cost to 22%. Earlier and more effective error detection, and hence reduced cost of remediation, more effective change management, reduce spending on re-work, reductions in schedule variability and increased cost predictability.
Many small and medium-size organizations set up the processes without CMMi and try to get the same benefits.
Does a company need formal quality certification for standardization?
Let's have a look at variations in non-CMMi level companies. A company like Synechron got CMMi level 3 appraisal in 2008 but instead of going further for level 5, started establishing own process model. Some companies believe that if they are committed to following the processes, they can deliver good quality consistently with some improvements release by release. There is no need for any formal quality credentials. Another company, a Pune based startup (Company confidential) feels that it is difficult to get continuous business from the same customer. They feel the need to focus on quality processes and continuous improvement. The customer expects improvement and savings project by projects. Establishing the process and having formal certification certainly help and strengthen our capability of delivering the best.
These are some extreme examples where one company has grown up to USD 400M with 6000 employees without formal accreditation and another in just start up with 100 employees thinking to get quality credentials. A big question here is that under what situation, an organization should think about establishing the process across the organization? a certain number of employees or revenue or customers, or projects? Another aspect is to use certifications as proof of quality for improving brand image. Can it be a sales and marketing tool? Many CMMi companies prefer to select the vendor with CMMi level.
As per CMMi report, 58% of appraised companies are below 100 employee counts and only 2% are above 2000 employees.
Below data shows the number of CMMI certification from 2009 as per the report [3] published by CMMi SEI in 2016.
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Overall 17% growth in appraisal in 2015. Notably US showed 28% as a highest contributor, Mexico 27% and china 22%. However in 2016, 81% appraisals are in US, India and China.
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