Editor’s note: On Thursday, February 16at 11:00 a.m. Eastern, Steve Hall will be the featured guest speaker on a webinar hosted by CAST Software on the topic of aligning service provider SLAs with long-term value. The discussion will focus on risk mitigation and value enhancement from provider relationships. View the key discussion points and pre-register here (no cost).
While cost savings remains a top priority for global Application Development & Maintenance (ADM) organizations, businesses are also increasingly looking to shift from a “run the business” model to a “change the business” (CtB) perspective, whereby ADM resources are focused on enabling transformational enterprise-wide initiatives rather than merely supporting the status quo and reacting to small enhancements. The demands associated with a CtB approach, however, can increase the risk of higher defect rates and maintenance costs, as well as poor documentation and weak standards around performance and process measures.
Here are the Top 5 key strategies to ensuring that a CtB ADM model is implemented with optimal efficiency:
- Separate and manage service categories. Delineation of the major categories of ADM is essential to efficient management. As the old adage goes, “You can’t manage what you can’t measure;” therefore, it is imperative for organizations to understand their application support costs. Specifically, you need to define three main categories — maintenance, minor enhancement, and project-based work — and manage costs of each of those categories separately. The reason is that cost drivers and performance indicators vary by category, so different actions and priorities may be required for each.
- Align the retained organization with the strategy. Many ADM organizations fall into the trap of focusing on what they can do, rather than what the business needs. For a CtB strategy, that’s a recipe for disaster. Key roles and attributes to help ensure that ADM activity stays on track include liaisons whose specific role is to coordinate between business and IT leaders; program/project managers to oversee large programs; client-driven architecture; ongoing business analysis to understand and communicate business needs; service delivery managers; and business subject matter experts to work with developers and testers.
- Define end-to-end service level agreements. Multiprovider environments are the norm in today’s outsourcing environment. The multisourcing environment provides significant advantages to clients, but also introduces complexities when trying to govern a large outsourcing arrangement or manage a large software development program. Service level agreements are an effective way to incent the right behaviors in a multiprovider environment, but they must be built to address the entire project lifecycle and clearly aligned with the responsibilities of the service providers.
- Embrace process excellence. Service levels and quality goals are often aligned with process maturity — and more mature organizations can be contractually obligated to deliver higher quality code. Since process adherence drives repeatability and productivity improvements, service providers should be incented to operate at CMMi level 3 or higher, and to commit to productivity improvements. Conduct ongoing operational assessments to ensure process adherence.
- Use key performance indicators (KPIs) and dashboards. Gauge performance on an ongoing basis with tools such as an earned value analysis (EVA) that includes a schedule and cost performance index. To stay on top of defects, employ other quality metrics such as:
- Defect injection and probability statistics for software quality
- Structural quality tools and techniques to validate the longer term supportability of the code
- Regression testing, defect detection, and effective test coverage ratios to validate the functional quality of the deliverables
For more information about ISG solutions for ADM, contact the author at [email protected] or +1 720 851 0481.About the author
As a partner and member of the Executive Board, Mr. Hall leads ISG’s Digital Strategy and all ISG Service Lines for the Americas. He also leads ISG’s Alliance group and is ISG’s Executive Sponsor to the TBM Council. During his time with ISG, Mr. Hall has led some of the company’s largest and most complex engagements with clients as diverse as United Airlines, Symantec, BP, World Bank, CEMEX and Motorola. He is a seasoned professional who brings considerable experience in emerging technologies to ISG clients. Prior to his position at ISG, Mr. Hall held senior roles at a number of renowned IT services companies, including Unisys and MCI. He also led large-scale eBusiness initiatives for technology solutions providers C-Bridge and CBSI and gained deep outsourcing and offshore software development experience as a delivery executive with Covansys. Mr. Hall co-authored Managing Global Development Risk: A Guide to Managing Global Software Development. He earned his degree in Computer Science from Regis University.