Fortune 500 - Heavy Burden on Existing Processes
Customer Profile
Information Technology (IT) department for a top five Property and Casualty insurance provider in Canada (and Fortune 500 member).
Challenge
The IT department of a Fortune 500 company (250 staff) was experiencing significant problems. Through several iterations and attempts to implement various process management frameworks and governance they had become over-saturated in process and process management. One third of the project teams were applying practices of the SEI/CMMI, and were deemed to be living in "the world of academia". One third of the project teams were semi-applying a hybrid form of CoBit - they recognized that some form of methodology was required but were not prepared or interested in the full-blown and disciplined SEI/CMMI world. They viewed themselves as the "conscientious worker bees" and were not accepting of the "academia" tact. The other third of the organization had thrown up their hands in defeat and were designing, constructing, testing and implementing applications on the fly without internal client approval. These workers took great pride in their reputation as "the cowboys".
As these various application delivery models were applied, it became evident that consistent delivery across the department was not possible. Without a consistent delivery model there was no way to predict and implement application delivery schedules and costs. Without a consistent delivery model, organizational governance and quality were inadequate. Without a consistent delivery model, metric and measurement information was unavailable or irrelevant. Without a consistent delivery model, project risks and issues, as well as re-work, increased to the point that the rest of the organization had no confidence that they could effectively deliver.
The development side of the IT Department was being assessed for its ability to consistently deliver operational efficiency across the organization. They knew that the only way to make things more effective was to harmonize the IT delivery capability; they needed to do something smarter.
Solution
QAIassist Snapshot was deployed to determine the IT operational disciplines that were inefficient. The results indicated that there was a particular weakness in the area of project management. Schedules were not being prepared or monitored. Nor was the project status being communicated to project stakeholders. Other inefficiencies existed as well. Immediate relief (bang for buck) would come from introducing a number of PM processes into the organization.
The results of the QAIassist Snapshot exercise were communicated to IT project teams and an internal project team (cross functional) was created to define and implement the solution. The project team utilized the QAIassist Headstart processes (Project Management specific) to kickstart the development of their new processes. Using the structure of the Headstart tool, the project team was able to incorporate many of their existing practices while leveraging the pre-defined Headstart processes. Once the new system was introduced, the project team was able to develop and deliver training material based a more efficient methodology.
Results
As a result of implementing their new processes, the IT organization now has a consistent delivery model which they apply to deliver applications/projects. The new delivery model provides more consistent delivery costs and timeliness for all projects.
Tangible Benefits
Prior to implementing the solution, it was estimated that the IT department was delivering an average of 4 new applications per year (total function point average for new applications of 15,000) as well as delivering addition functionality to existing applications (total function point average for existing applications of 10,000). The total function point count total of 25,000 divide by the 250 staff of the department provide a function point quotient (average number of function points per staff) of 100. At an average annual salary of $60,000 per IT staff this translated into a productivity factor of .00167.
Upon implementing the solution, the IT department was delivering an average of 6 new applications per year (total function point average for new applications of 22,000) as well as delivering addition functionality to existing applications (total function point average for existing applications of 18,000). The function point count of 40,000
(divided by the 250 staff of the department) provided a function point quotient (average number of function points per staff) of 160. At an average annual salary of $60,000 per IT staff, this translated into a productivity factor of .00267.
Intangible Benefits
Several by-products have been gained by implementing this solution.
First, as part of the solution (project management processes), the project team incorporated the identification and collection of metrics for the process. In this way, both the result and the projects can be measured during implementation and upon completion.
Second, by virtue of having implemented a consistent delivery model, the organization was able to introduce a corporate "QA/ Governance" function, and in this way they could monitor how the project management was being performed by all of the project teams.
Utilizing QAIassist Snapshot and Headstart, the organization now routinely delivers quality applications on time and within budget and the user community is very pleased with the applications, maintenance and support being delivered by the IT organization.
ROI Analysis
The annual productivity factor increased from .00167/per employee to .00267/per employee.
The annual IT resource budget remained constant at $15,000,000 (250 X $ 60,000). However, the solution has enabled the existing staff to deliver an additional 15,000 function points. Due to the increasing demand for added functionality (existing operations and new legislative functionality), the organization successfully delivered the added functionality without having to increase its IT staff.
By increasing the average function points per staff by 60 (from 100 to 160) points - the IT department increased its productivity by 37.5 %. This increase in productivity saved the company from having to hire an additional 93 staff, translating into savings of $ 5,580,000.
The cost to implement the solution was $ 1,008,000 - 6 consultants for a period of 8 months (21 days per month) at a rate of $1000 per consultant/per diem.
Mid-Sized Company - Trying to Implement SDLC
Customer Profile
An outsourcing company that started developing solutions for small businesses continued to prosper. Through this growth, the company began developing applications for larger and more diversified clients. This expanding and diverse client base began placing additional expectations on the outsourcing company. What was once a question of "can you build us an application? " changed to "does your delivery methodology align with our delivery methodology? - can we synchronize the two methodologies?". The outsourcing company was faced with a strategic decision. Should they continue with their existing business model (developing small applications for small clients) or should they strive to grow their business to a larger, more complex and lucrative client base.
Challenge
The immediate challenge was to assess how they could incorporate an integrated IT methodology that was robust enough to align with even the most significant organizational delivery model while at the same time have enough flexibility to be scaled to meet a less rigid development environment.
They recognized the cost (time and resources) to create their own IT methodology would be expensive and difficult to implement (sales and delivery). They required an IT methodology they could leverage immediately without incurring the time or cost to develop it - they wanted to adapt to a greater client base while mitigating the business risk. They needed something to assist them in getting to the next level, they needed to do something smarter.
Solution
QAIassist Integrated Methodology was the solution to all of their problems. Their immediate need—to have an IT methodology that would integrated into the delivery models of clients - was solved without having to develop the methodology themselves. Utilizing deliverables from three (Project Management, Software Development, Software Testing) lifecycles the QAIassist Integrated Methodology could be customized to integrate with all of their clients delivery models. This solution ensured clients could quantify how their applications would be developed and how the delivery process could be harmonized with their existing practices.
Tangible Benefits
Utilizing the QAIassist Integrated Methodology, the outsourcing company can readily align their delivery process with the clients - this ensures every client has access to a customized application and a customized approach in how it should be constructed and delivered.
Since introducing the QAIassist Integrate Methodology, the outsourcing company has been able to increase its delivery to larger sized clients - this is estimated to have lead to an average annual increase in sales of 20% revenue (from 1.2 million to 1.5 million). Much of this increase can be attributed to the outsourcing company's ability to deliver a more robust solution to a broader client base.
Intangible Benefits
With the QAIassist Integrated Methodology at the heart of engaging with their clients, they have been able to evolve from a small outsourcing company building small applications for small clients into a mid-sized company with the ability to provide customized and affordable solutions to each of their clients.
ROI Analysis
The annual revenue increase has been 20%.
The cost to implement the QAIassist Integrated Methodology included several initial training sessions ($10, 000) a monthly support fee of $2000 and a licensing fee dependent on usage of the methodology with their clients. Average annual cost totaling $60, 000 (approx). ROI estimated at 50% (not all revenue increase as a result of the QAIassist Integrated Methodology solution).
Small Company - erratic product delivery (limited IT budget)
Customer Profile
A small manufacturer could not rely on its IT resources (12 staff) to effectively deliver applications and support to its operational staff. Applications were being delivered late and rarely satisfied the business needs. Frequent IT inefficiencies resulted in constant rework (requirements) on the applications and non-existent testing practices ensured the application would be in a constant state of repair.
Challenge
After an initial QAIassist Snapshot exercise - it became evident the IT organization required some fine-tuning. The results of the QAIassist Snapshot indicated there was a need to have the user community more engaged with the IT staff throughout the development (and maintenance) lifecyle of mission critical applications without encumbering them with formality and technical paperwork.
To successfully deliver applications, the IT staff had to identify the means and methods they would utilize to ensure they remained in communication and synchronization (to ensure business requirements were built into the applications) with the user community stakeholders throughout the life of a project. Without this communication, they knew they would continue to develop applications that did not meet the operational needs and require constant re-work and re-training.
Solution
The IT department reviewed the QAIassist Integrate Methodology to determine the specific deliverables they could utilize to ensure they remain in sync and in communication with the user community as applications were defined, designed, constructed, tested and implemented. They selectively chose specific deliverables of the QAIassist Integrated Methodology that served their purpose (and even customized some of them to meet their specific needs) and began sharing them with the business community.
Tangible Benefits
The business community was pleased to be able to incorporate all of their requirements as the applications were developed and the IT Department resources were freed of having to constantly do re-work and testing on the production applications. Both the business community and the IT Department staff were pleased to be working together in delivering quality and timely applications without being encumbered with the need to produce "too much" documentation.
Intangible Benefits
The scaleability of the QAIassist Integrated Methodology enabled the business community and IT department staff the freedom and flexibility to incorporate and adjust deliverables to best suit the business need. The primary benefit was that the QAIassist Integrated Methodology could be customized to best deliver and maintain mission critical business applications.
ROI Analysis
It has been estimated that delivery and maintenance efficiency has increased 15% (though few metrics were available from the outset of this engagement) and rework has decreased by 25%.
The cost to implement the QAIassist Integrated Methodology included several initial training sessions ($9, 000) and a monthly support fee of $1200. Average annual cost less than $ 25,000 (approx).
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