You are on page 1of 12

Transforming

IT Delivery Models ITD Research #6 : Sep 16, 2011


1 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Introduction
IT delivery methodologies have existed since the dawn of the industry. The moment IT projects became too big and complex for a single person to deliver some kind of planning methodology was always going to be needed to control and manage projects. The earliest of these formal methodologies was the waterfall system, documented in academic papers since the 1950s. In simple terms this described the software engineering process as a series of steps that connected from one to the next cascading down like a waterfall. Those basic steps were to gather the requirements, design the solution, implement it, verify and test the delivery, maintain what has been delivered. Thats a common sense approach, but the world has moved on. There is now a plethora of formal methodologies helping CIOs and software developers to coordinate what the user wants with the most reliable way to deliver those solutions. The UK government designed their Information Technology Infrastructure Library (ITIL) in the 1980s based on the process control models of W. Edwards Deming the American academic who transformed Japanese production methods after the Second World War. ITIL has now become something of a global standard with the Open Group consortium now heavily promoting its use in Brazil. PRojects IN Controlled Environments (PRINCE) is another process driven project management methodology often demanded by clients, but there are now as many approaches to developing software as there are methodologies. The Capability Maturity Model (CMM) developed by Carnegie Mellon University was probably the process methodology that facilitated the boom in offshore software development. Clients have always demanded faster and more reliable software deliveries and with the explosion of tools to help facilities rapid application development and Agile design methodologies, such as Scrum, Lean, and RUP, have led to a revolution in the way systems are designed and built. This week, our CIO research explores how these changes in software development and project management methodologies have affected the teams on the ground really delivering for your customers

the world has moved on. There is now a plethora of formal methodologies
2 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Participant Feedback
To explore the issue of executives using social media, in this weeks research survey we asked four questions three of which were multiple choice and one designed to promote an open discussion. We received answers from 23 executives from 18 industry sectors: consumer services, healthcare, oil & energy, chemicals, broadcasting, engineering, shipbuilding, automotive, telecommunications, logistics, financial services, insurance, food and beverages, education, paper & forestry products, cosmetics, media, retail. Question 1: Does your department use a formal established delivery methodology?

Use our own method

34.8%

No

13%

Yes

52.2%

10

12

This chart shows a strong support for formal methodologies in general. Clearly the CIO community knows that whichever method is used, it is important to use something to control projects. As can be seen from the chart, over half (52.2%) of our IT leaders say that they are using a formal established delivery methodology, with a further 34.8% saying that they are using their own methods. With some of the comments suggesting that many IT leaders take a standard methodology and mold it to the company needs this is no surprise. Just 13% of IT leaders do not use any form of methodology to control how deliveries are planned and made. 3 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Question 2: Does it help you to deliver better results for your customers by using a formal methodology in IT services?

Yes, for some services

17.4%

No

4.3%

Yes

78.3%

10

12

14

16

18

At the end of the day, the IT leader has to report to customers. They might be outside the company, but usually they are internal the business. It is only worth adopting formal delivery methodologies if it can be shown that the customer is happier with what the IT team delivers. As can be seen from this chart, there is overwhelming support that the use of formal methodologies does help with delivery to customers. 78.3% of our IT leaders support the use of formal methodologies as a way of improving delivery to customers and a further 17.4% add that it helps for some services. The 4.3% suggesting that customers do not get any benefit from the IT team using a formal delivery methodology appears to be an insignificant minority view.

4 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Question 3: Has the world moved to from "big" inflexible methodologies to Agile - with rapid delivery and turnaround of customer requests?

Not always applicable

43.5%

No

8.7%

Yes

47.8%

10

12

As outlined in the introduction, there are many formal methodologies and over the past fifty years they have evolved and changed from being quite rigid and formal to flexible. The growth of Agile methods in the past 10 to 15 years in particular has completely changed how flexible an IT team can be while still maintaining some formality and control over deliveries. The question asked whether the world of IT development has moved on the big methodologies often seen as inflexible to an agile world. Almost half of our IT leaders (47.8%) agreed, so there is clearly a very strong view in the Brazilian IT market that Agile methods are important. It is important to note that 43.5% of our IT leaders said that Agile is not always applicable to the deliveries that they are making. Clearly it would be interesting to go back to ask them why, but the assumption is that in some cases and industries a very strong control over deliveries is essential so Agile works well where applied to the correct problems. Just 8.7% of IT leaders disagreed with the statement, suggesting a very small minority with the belief that nothing has changed or that Agile does not work.

5 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Question 4: Please add a comment on your experience about the best methodology that works for your team and whether you are considering a change in methodology? Logistics Happy IT customers like methodology I do not see the formalization and rigor as loss of agility, but as something that is necessary for the quality of the delivery process. Therefore, we adopted methods that are well defined and documented, which can be used with speed and responsibility, ensuring that the final result for the client (whether internal or external) is what has been asked and that the client can take advantage of the result. From my understanding, happy customers (those who get what they asked for with quality and within the negotiated timescales) like methodology and consider its use as something that speeds up the process. The perceived lack of agility is very much related to the difficulty of negotiating deadlines and not the methodology used for deliveries. Financial services Agile methods helps IT deal with changing business goals We use the PMBOK principles as a way to target, in a formal manner, the various disciplines involved in the development of a project. However, priorities and short-term goals are increasingly dynamic and must be changed every time these realities change. This is the context in which agile methods are relevant, in terms of identifying the change and what should be done in order to return to alignment. Insurance Agile methods and common sense is the future of IT Formal delivery methods favor the execution greatly when it comes to meeting deadlines. You may even work on scope, responsibilities and reporting, but you get poor results when the main focus is on time. Many things are always left for future releases; satisfaction at the time of deployment is not what it should be. The approach of delegating to achieve, and where possible, combined with agile methods, minimizes these kinds of impact and generates much more of a sense of "proper delivery." Major methodologies for major projects (if they cannot be divided) and the agile approaches for all the other projects is the possible and probable path for IT. Oil & Energy Move to global standards meant use of heavier methods As the company is moving towards the use of global templates, we have been using more formal and structured methodologies (and a little bulkier) for IT delivery.

6 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Consumer Services The same methodologies are not always applicable Methodologies are not always applicable and are not always agile. I have had good results with Scrum (Agile) and awful results with CMMI (used within a cumbersome process). However, I have achieved opposite results and an excellent delivery (in terms of time, cost and quality) with CMMI and a poor delivery with Scrum. Having said that, it is down to the manager and the company to decide what is the best fit when it comes to better methodologies for their daily tasks. Healthcare Frequent control of deliverables helps IT in meeting expectations We are currently implementing a system to control deliverables every two months, where we decide in advance what should be done or not, so that we can align expectations with our customers. Insurance Agile is crucial to deliver at the same speed of the demands The deliveries began to be required at the same speed and the demands and that brought about a major evolution in development methodologies and project management. Within the companies I work at, I have been using agile methodologies and the result is very satisfactory, since we can greatly reduce the dissatisfaction and meet the expectations of users and customers with more deliverables for each cycle. And this is not just for the sake of faster deliveries, but also for the ability to submit each part of the project to a cycle of "revalidation", which has made our processes more reliable and projects and stable. Food and Beverages We use agile elements in our delivery to generate value Although we have not used any kind of agile method formally, we are applying parts of the methodology to get results faster and create deliverables with higher added value. We seek to engage the business areas in the whole project development cycle and this facilitates the planning and design processes while aligning delivery priorities and expectations in terms of expected results. Consumer Services Methodologies should not increase bureaucracy and cost The methodology should seek simplicity and objectivity, as opposed to generating a lot of bureaucracy and cost. The definition of a methodology should be based in its ultimate goal, that is, ensuring the quality of delivery, cost control, risks and deadlines, and most importantly, ensuring accessibility to documentation related to the deliverables. Education We are always adapting IT delivery to the needs of the business We are in a constant movement of observation around how to adapt delivery for better comfort and satisfaction of the business. We constantly align with teams the need to "see" the movements of the business naturally, while adapting our processes and looking for speed and efficiency. 7 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Financial services Formal methods should not be seen as rules set in stone "Packaged" methodologies as CMMi, PMI and ITIL are useful but should not be seen as rules set in stone. Each company can and should adapt methodology to its reality and the size of its projects. Paper & forestry products Delivery should be fast, even if rework is needed later More than the methodology itself, there is a matter of changing attitudes of IT professionals, the focus should be on generating value for the business in an agile manner and as quickly as possible, even if it is necessary to do some rework in future. Cosmetics Large methodologies are only excellent for IT suppliers The knowledge of various methodologies along with the common sense of what/how/where to apply them according to size and type of project are crucial for good results; large and inflexible methodologies are only excellent for IT companies. Media Formal methods are indispensable for large, high-budget projects In my opinion, PMBOK is still the most comprehensive framework for projects. I always use it for large, complex and critical projects, especially those involving a lot of resources and big budgets. On the other hand, agile methods can deliver great results of easy application and acceptance by the IT team as well as business functions and project sponsors. We used Scrum for medium and small projects and the results have been extremely satisfactory. Retail Methodology tools used cannot hamper project execution The important thing is to define, at the beginning of the projects, which will be the artifacts used for better management and ensure the best quality for results depending on their size and criticality. The artifacts selected must ensure these metrics and cannot have a volume that could prevent its execution. Telecommunications We use ITIL with changes for increased agility We used the very basis of ITIL to create better results, but we need to make some modifications to be agile in terms of delivery. Our area of activity (telemarketing services) is very dynamic and we cannot be slow in delivering solutions! Automotive Involving customers in IT processes is the advantage of methodology The great advantage of conducting deliveries based on methodology is ensuring that the result delivered is what the customer really wants, since the customer participates in the process, from specification to testing stage. Chemicals IT needs agility, but its utility aspect must not be forgotten Businesses require agility in projects, but IT has a "utility"side where extreme rigor and a strict application of procedures are needed. In addition to the inspiration of COBIT, COSO and ITIL, we will align ourselves to the ISO standards. 8 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

Conclusion & Executive Summary


In the modern IT environment it goes without saying that some control is needed. Modern projects have many dependencies, that may even involve external actors, and it is not possible to coordinate a large team around a complex problem without some formal guidelines. As stated in the introduction, IT Decisions always expected much of the debate on this subject to circulate around the two poles of formal rigid methodologies and more Agile rapid development methods. The original Agile manifesto is now over a decade old. It stated: We value Individuals and interactions over processes and tools Working software over comprehensive documentation Customer collaboration over contract negotiation Responding to change over following a plan All those attributes on the right are the more traditional aspects of developing software, dealing with suppliers, and following a formal methodology. Given the adoption of the values on the left by most of the IT leaders in our survey it appears that Agile adoption is very much in the ascendancy, but a number of subtle issues were identified within the replies from our IT leaders. Some industries face tight regulation, banking, insurance, and chemical production for example. In these industries IT is seen as a utility it must always be there and must always work. There is no scope for failure when a chemical plant or a trade involving tens of millions of dollars depends on the system working. In these cases there is no choice other than for tight formal controls on projects Agile methods, which involve iteration where mistakes can be corrected, do not work when mistakes cannot be tolerated. Customers including internal ones need to be involved in the IT methodology for them to understand why it is needed. If customers are not involved at the various stages of design, development, and testing then they will fail to understand the importance of the methodology and will demand unrealistic deadlines. Formal industry methodologies are essential for IT suppliers who are delivering everyday to clients with contracts in place determining what is to be delivered, but with an internal customer there is scope for more flexibility. It remains important, but the internal projects have more chance of promoting innovation than anything bought from a supplier. With these often-recurring issues in mind, there were clearly a few learning outcomes that can be taken away.

9 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

As always, IT leaders love pragmatism. If the tools help them get the job done and the customers remain happy then those will be the tools placed in the toolbox. In the technology press it looks as if Agile is taking over, but the situation is more complex, with many IT leaders forced to adopt a more conservative delivery model. There remains a need for a wide variety of development methodologies to ensure that all projects critical or experimental can be delivered in the best possible way.

Everyone uses something. There is no modern CIO who would run a project without some kind of formal control, whether this is a very tight project management methodology or Agile and extreme programming methods. There is always a need for control and measurement, whether the project is internal or being delivered by a supplier. It is very common and accepted to take an industry standard and to then modify it for use within the organization. Many IT leaders explained that they use a tool such as ITIL, but they take the core of the methodology and then tweak it to work within their company. There were just about as many IT leaders doing this as those taking an industry standard and using it without change so it is a very common and accepted practice perhaps not acknowledged by the companies selling training or audits in methodology use. It was generally accepted that smaller and less critical projects almost always would use an Agile development methodology, but large budget major projects would need a more formal framework. However, this could be driven in part because managers outside the IT department need reassurance that big projects get bigger control frameworks as there is no technical limitation on the size of an Agile project.

ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

10

IT Decisions Research
IT Decisions produces a report like this every Friday, based on what CIOs told us that same week. It is fast and relevant knowledge from your peers, it is only available to the CIOs in the research network, and it is free. What is the catch? You pay by participating. Every week, we will send you four simple questions that will take no more than five minutes to answer. The more participants, the better the quality of the research. So please do invite your colleagues to join! Do you want to direct the research and define the topics alongside our board of founder members? We also offer Platinum memberships that allow you to steer the process, as well as other benefits including comprehensive reports, face-to-face focus sessions and more. Get in touch for more details at contact@itdecs.com. The IT Decisions FutureSkills fund is a charitable, transparent fund focused on improving IT education and training in Brazil. If you recommend a Platinum member to the network, we will donate R$500 to the fund in your name and Platinum members will get to choose which organization gets the money at the end of the year. Please contact us for more details.

11 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved

About IT Decisions
IT Decisions is the premier source of insight into the technology and high-tech service industry in Brazil. The company creates English-language news and insight for a CIO audience with regular features and analysis that cannot be found elsewhere. We focus on decision-makers and influencers the buy-side. Reproducing the sales pitch or adverts of suppliers is not our thing; we focus on those buying the systems. IT Decisions was founded in 2011 by Mark Hillary and Angelica Mari, two of the most respected business and technology writers in Europe - with a collection of best-selling books and industry awards between them. The IT Decisions research network is an invitation-only group of CIOs in Brazil who work together to produce a new research report every week. Take a moment to connect with the IT Decisions management on LinkedIn and take a look at some of their books, other media, blogs, and publications:

Mark Hillary, Chief Executive Officer http://j.mp/markhillary Angelica Mari, Publishing Director http://j.mp/angelicamari

Photo Credits: Andy Ciorda Andrew Stawarz

http://www.flickr.com/photos/ciordia/54065888/ http://www.flickr.com/photos/stawarz/2981086612/

12 ITD #6 Transforming IT Delivery Models IT Decisions 16 September 2011 - All Rights Reserved