Sunday, November 02, 2008

The Relevance of Level 4

[Over the summer, I wrote a number of blog posts for Modus Cooperandi. I’d like those posts to get a wider audience. Starting with this one about the relevance of level 4 organizational maturity…]

CMMI Model Level 4 is often thought of like Nebraska or Kansas - it’s the flyover territory of CMMI. The big offshore outsource companies often think of Level 4 as something that they can skip - jumping from level 3 to level 5. After all, there are only 4 process areas. Two in Level 4 and two in Level 5.

When I was at Microsoft, working on MSF for CMMI Process Improvement, we talked about the future prospect of an enhanced edition that provided full coverage of Level 4 and 5. [The current release has about 80% coverage of Levels 2 and 3, and 20% coverage of Levels 4 and 5.] There was no market demand for a Level 4 solution. Our market research was telling us that there was a market for a Level 3 solution - the one we produced - aimed at the government contracting market in North America and the ISO 9000 compliance market in South America. We also knew that there was a market for a Level 5 template for TFS - mostly aimed at the offshore outsourcing companies. Level 4 just didn’t come in to our plans. It was flyover territory. It seemed no one does Level 4. If you look at the list of CMMI appraised firms, there are very few at Level 4. So why am I suddenly a big advocate of Level 4?

Well, it seems from discussions with clients and potential clients in America and Europe, our clients need to have the equivalent of Level 4 organizational maturity in order to meet their business goals and strategic objectives. They don’t need to be an optimizing organization at Level 5 - that would be icing on the cake. But they do need to be predictable. They want to have strong delivery with low variability. The want to be proactive and drive down cycle times using objective quantitative management. They need all of this to deliver on business goals within the tight financial controls and corporate governance that they now find themselves under. They need to be the equivalent of Level 4.

The real problem is that typical Agile methods can only take them to Level 3. So Agile isn’t enough. That’s where we come in. Our experience in creating cultures that drive towards high maturity (Levels 4 and 5) while implementing Lean and Agile techniques is still fairly unique. We help clients reconfigure their organizational culture to enable a high maturity organization to emerge while still gaining all the benefits of Agile and Lean methods.

The aim is to generate a clutch of Level 4 equivalent organizations. Clients who can estimate projects and iterations and deliver results with a low degree of variation from the original estimate. Firms who use predictive methods and leading indicators to learn and adapt quicker than those simply using retrospective methods and lagging indicators. And businesses who are led by objectivity and have left superstition and subjectivity behind in their organizational past.

CMMI Model Level 4 has real business relevance. Business that achieve it will achieve their business goals, hit their numbers and delight customers, shareholders and employees. Getting to Level 5 will allow a firm to become ever more competitive and to dominate their market. But for many firms the need to achieve the equivalent of Level 4 maturity is a business imperative, now! Anything less will leave all stakeholders dissatisfied. Technorati tag: David+Anderson, agile+management, CMMI