1 Maturity or agility or …? April, 2009 Juhani Anttila Venture Knowledgist Quality Integration, Helsinki, Finland [email protected]@telecon.fi

1

Maturity or agility or …?

April, 2009

Juhani AnttilaVenture Knowledgist Quality Integration, Helsinki, [email protected] www.QualityIntegration.biz

These pages are licensed under

the Creative Commons 3.0 License http://creativecommons.org/licenses/by/3.0/deed.en

2

QuickTimeª ja pakkauksen purkuohjelma

tarvitaan elokuvan katselemiseen.

Crosby, Philip (1979). Quality is Free

xxxx/19.1.2009/jan

(*)(*)

(*) a few pages(*) a few pages

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Capability Maturity Model Integrated (CMMI)



3580x/19.11.2008/jan

The CMMI a model of the maturity of the capability of business processes. A maturity model can be described as a structured collection of elements that describe certain aspects of maturity in an organization, and aids in the definition and understanding of an organization's processes. CMMI approach appreciates the use of ”Best practices”.

Efficiency fulfilling Efficiency fulfilling specified requirementsspecified requirements

(*) 573 pages

(*)(*)

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Waterfall model



(Ref.: Winston W. Royce 1970)

There are various modified waterfall models with slight or major variations upon this process.

3579/19.11.2008/jan

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Maturity:Maturity:• the state of being mature• ripeness• full development• perfected condition

Kypsyminen: • Jatkuva portaittainen kehittymismalli (*)

Maturity model• Laatukäsitteistö rajattu• Based on best practices = past practices= past practices• Sertifiointi Sertifiointi

ArviointiArviointi• Suljetut ON/EI kriteerit Suljetut ON/EI kriteerit

Miten ymmärtää kypsyysajattelua?

xxxx/8.4.2009/jan

Onko maturiteetti oikein tavoitteena?Tapahtuuko kehittyminen portaittaisesti?Eikö Best practice = Past practice?Mikä on suljettujen ennalta määriteltyjen yleiskriteerien dynamiikka?

(*) Systematic, structured way to approach model-based process improvement one maturity/capability level at a time. Achieving each level ensures that an adequate process infrastructure has been laid as a foundation for the next stage. Achieving each maturity level ensures that an adequate improvement foundation has been laid for the next maturity level and allows for lasting, incremental improvement.A capability level 5 process is characterized as an optimizing process. The process is improved based on an understanding of the common causes of variation inherent in the process. The focus of an optimizing process is on continually improving the range of process performance through both incremental and innovative improvements.

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CMMIquality The ability of a set of inherent characteristics of a product, product component, or process to fulfill requirements of customers.requirement (1) A condition or capability needed by a user to solve a problem or achieve an objective. (2) A condition or capability that must be met or possessed by a product or product component to satisfy a contract, standard, specification, or other formally imposed documents. (3) A documented representation of a condition or capability as in (1) or (2).quality management---- quality assurance A planned and systematic means for assuring management that the defined standards, practices, procedures, andmethods of the process are applied.

ISO9000qualitydegree to which a set of inherent characteristics fulfils requirements requirementneed or expectation that is stated, generally implied or obligatoryquality managementcoordinated activities to direct and control an organization with regard to quality quality assurancepart of quality management focused on providing confidence that quality requirements will be fulfilled

xxxx/8.4.2009/jan

Terminological nonconformity in the CMMI and ISO 9000

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Business leaders’ key interest: How could sustainable success be possible in business in practice?

General conclusion from a recognized world-wide study (*):

Revenue growth is the primary driver behind the creation of shareholder value over the long-term. Value-building growth follows a specific pattern with common company-internal factors.

1729/8.9.2007/jan

Simple growers Value growers

Underperformers Profit seekers

(*) A T Kearney

Market value growth (%)

Rev

enue

gro

wth

(%)

Industry average

Indu

stry

av

erag

e

Business leaders are interested in growth:

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Organizational development and growth

Market value growth

Revenuegrowth

Average

Average

1915/11.9.2007/jan

Companies cannot maintain continuous growth simultaneously both in revenue and market value. However, the revenue growth is essential.

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Transition phases in a transformation (*)

(*) Ref.: Adams & al3171/2.12.2008/jan

1. IMMOBILISATIONShock - Mismatch betweenexpectations and reality

2. DENIALDefensiveness - Retreatinto false competence.Denial of needto change

3. INCOMPETENCEAnger, frustration and confusion - Awareness that change is necessary but unsure what to do.

4. ACCEPTANCE OF REALITYSadness - Letting go to pastattitudes and behavior.Excitement - At prospect ofimproved performance

5. TESTINGTrying new approaches and coping with risk of failure (trepidation)

6. SEARCH FOR MEANINGCuriosity - Trying to understand how and why new behaviors are better.

7. INTEGRATIONConfidence - New attitudesand behavior becamepart of behavioralrepertoire

Perceivableperformance

Time Conflicts, decay, succumbing

103456x/2.3.2008/jan

Necessary emphases in modern quality management?

1. Integration: – Implementing effective / efficient and business-

relevant quality principles and methodology embedded within organization’s normal activities of strategic and operational management

2. Responsiveness:– Being able to adjust quickly to suddenly altered

external conditions, and to resume stable operation without undue delay

3. Innovation: – Striving continuously for new organization-

dedicated innovative and unique solutions and encouraging various choices for quality management in different organizations.

Quality management Quality of management

Standard approach An organization’s unique approach

Dynamic and flexible business management

111418/7.1.2007/jan

Past

(Given)Business environment

Last period’smanagement results

Reflection, analysis

”Is”

VisionFacts

Management process, business processes

Future

Mid-term sight

Long-term sight

(What should be done in the next period)

Change plan (*)

Focus on Vital few

Planning for the future: Hoshin (breakthrough) planning

(Ref.: Shiba) (*) Hoshin (breakthrough) plan

”Should”

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Business crises in turbulent business environments: “Authority without responsibility”

3565/2.12.2008/jan

Prof. Richard Sennett: Ever-mutable form of capitalism, “Mp3 Economy”: Drastic changes in corporate culture wrought by downsizing, “re-orging”, and outsourcing Appreciation of reality where one should continuously jump from task to another or at least have capability to continuous change Erosion of certainty and the need to adapt to changing circumstances Changes in work ethic, in our attitudes toward merit and talent, in public and private institutions (“specter of uselessness”). Craftsmanship and getting the job right seen as negatively wasteful and obsessive. Time

SpeedChangesAgilityComplexityDiversityImmaterialnessVariety

Quality profession

Business environments and society

Problem

Typically business crises relate today to: Conditions of instability or danger, as in social, economic, or political affairs Unique situations that have reached difficult or dangerous culminating points Times of great disagreement, uncertainty, suspense or suffering

Today all these aspects are very typical and significant features of business environments to be considered by business managers.

Prevailing and traditional quality management means have not a lot

to help organizations in modern business environments.

Crisis in quality management

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Modes of operation

1. Mechanisticserialautomaticaccuracydue order

1754/27.1.2005/jan

2. Organiccomplex, organizedinteracting actorsnetworksconcurrentcommunion

3. Dynamic Complex, chaoticspontaneusresponsiveinnovativevirtualvariativevariable rulespersonifiedquantum leap

(Ref.: Legat)

All business processes and activities consist of actions with three concurrent dimensions comprising different degrees of freedom and variety:

Operational and structural complexity

VarietyDiversityDegrees of freedom

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Balance between process and structure

3628x/3.1.2009/jan

Quic

kTim

eª ja

pak

kau

kse

n p

urk

uohje

lma

tarv

itaa

n e

lokuvan

kat

sele

misee

n.

Process(acting):

Emergent, real-time, active,skilled,learned,

open,alive

Stiffness ofstructure

Activity

Structure (being): Planned, built, controlled, passive, trained, forcrd, closed, dead

AGILITYAGILITY

MATURITYMATURITY

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Activities in complex responsive processes of relating

High Certainty Low

High

Low

Agr

eem

ent

Standards Guidance Monitoring

Political control - compromise

Experimenting

Chaos

Anarchy

Innovation

Creativity

Debate

“Zone of Complexity”

Trial & Error

Appropriate management actions should be selected based on the degree of certainty and level of agreement on the issue in question.

3134/5.4.2006/jan (Ref.: Stacey, Ortner)

All kinds ofactivities may existin business processes.

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How to manage complex responsive processes of relating?

Elements for managing complex responsive processes of relating:

1. Identity of the actor(s):• The set of characteristics

by which an item is definitively recognizable

(e.g. a process plan) • The item: Process / Activity

/ Automatic actor / Person1. Relationship of actors:

• Level of agreement• Degree of certainty• Level of win / win

2. Communication between actors:• Open• Restricted • Closed• Fuzzy

3135/21.4.2006/jan (Ref.: Ralph Stacey, Marian Naidoo)

Relation-ship

Communi- cation

If the relating processes are not clearly identified (process plans), the situation falls into pieces of interacting process-internal actors, and even may develop towards chaos or anarchy.(Some of the relating processes may be hostile)

Process # n

Process # m

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Agility to respond volatile business realities

Agility:

a comprehensive response to the business challenges of profiting from rapidly changing, continually fragmenting, global markets for high-performance customer-configured goods and services

Agility attributes:– dynamic– context-specific– aggressively change-embracing– growth-oriented

Agility versus maturity is a hot question of the modern business management.

1671/14.4.2007/jan (Ref.: Goldman, Nagel & Preiss)

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Agility or Maturity?

Agility school versus Maturity school:

Individuals and interactions [Formal] processes and tools Working solutions Comprehensive documentation

Customer collaboration Contract negotiation Responding to change Following a plan

Which one does create the best value?

3212/2.2.2009/jan (Ref.: The Agility Manifesto)

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3581/15.10.2008/jan

Scrum methodology

(Ref.: Takeuchi and Nonaka, 1986)



Roles in Scrum:- Pigs (committed): Product owner, ScrumMaster (facilitator), Team- Chickens (involved): Users, Stakeholders (customers, Vendors), Managers

Scrum is an iterative incremental process of product Scrum is an iterative incremental process of product development commonly used with agile development. development commonly used with agile development.

New developedNew developedproduct function-product function-

alityality

24 hours24 hours

1...4 weeks1...4 weeks

Daily 15 min. standup project Daily 15 min. standup project status meeting, ”scrum”status meeting, ”scrum”

ProductProductBacklogBacklog(Features(Featuresassignedassignedto sprint)to sprint)

SprintSprint

SprintSprintBacklogBacklog

Prioritized productPrioritized productfeatures defined byfeatures defined bythe customerthe customer

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tarvitaan elokuvan katselemiseen.QuickTimeª ja

pakkauksen purkuohjelmatarvitaan elokuvan katselemiseen.



3591/10.12.2008/jan

Breakthrough transformations as proposed by Dr. Shiba

Managerial actions:- Control (past)- Continual improvement (present)- Breakthrough (future)

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Transformation, a success factor for a sustained business success

3560/10.12.2008/jan

In strategic development there is a need for a large-scale breakthrough change in performance of the organization and its products.

Transformation is a radical discontinuous change. Transformation means change of form, shape or appearance. The Greek word metanoia may be more suitable than transformation. It means penitence, repentance, reorientation of one’s way of operate. Basically it needs a spiritual conversion.

Transformations are initiated and managed from the strategic (top management) level of organization.Transformations do not happen spontaneously but by decisive actions.

(Ref.: Deming, Shiba)

Perform-ance

Time

Transformation

Now

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Innovativeness in product realization

What is innovativeness about?

3589/20.12.2008/jan

What

How

New

New

Old

Old

What is covered?:- Product characteristics- Product related processes

Why?- For improving quality

(degree to fulfill needs and expectations of the interested parties)

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Technology and innovation

1983/20.1.2003/jan

Technology:- processes by which an organization transforms labor, capital, and information into products (goods and services) to provide value for interested parties (stakeholders)

(This concept of technology extends beyond engineering and manufacturing to encompass a range of marketing, investment, and managerial processes. It also includes quality management))

Innovation:- a change in one of the technologies

(Ref.: Christensen)

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Sustaining versus disruptive technology

1984/20.12.2000/jan

Sustaining technologies:- technologies fostering improved product performance

(Development of sustaining technology may be discontinuous or radical in character or of an incremental nature.)

Disruptive technologies (discontinuous innovation):- technologies that result in worse product (technical) performance (at least in the near term)

(Generally, disruptive technologies bring to market very different value proposition than had been available previously. Generally, disruptive technologies underperform established products in mainstream markets. But they have other features that a few customers value. Products based on disruptive technologies are typically cheaper, simpler, smaller, and more convenient to use.)

(Ref.: Christensen)

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The impact of sustaining and disruptive technological innovations

1986/20.2.2006/jan (Ref.: Christensen)

Perform-ance

Time

Performance demanded at the high end of the market

Disruptivetechnologicalinnovation

Performance demanded at the low end of the market

Progress due to sustaining technologies

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How to solve the “Agility - Maturity Dilemma”?

2950/11.11.2004/jan

Agility versus maturity is a hot question of the management and the quality management of dynamic organizations:

– Agility means dynamic, context-specific, aggressively change-embracing, and growth-oriented issues.

– Maturity means consistently continuously developed established and well-defined systems for management and operations.

The both approaches are needed simultaneously, but the big question is how.

Flexible and agile systematic approach is seen possible even from the quality point of view when understanding the underlying features of business dynamics and using new modern principles for business process management and advanced information technology.

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Lao Tsu (*): Tao-Te Ching, Poem #26: “Lightly strong”

Solution to the maturity / agility dilemma:

“Gravity is the root of lightness; stillness is the ruler of movement.Therefore a wise prince, marching the whole day, does not go far from his baggage wagons. Although he may have brilliant prospects to look at, he quietly remains in his proper place, indifferent to them. How should the lord of innumerable chariots carry himself lightly before the kingdom? If he do act lightly, he has lost his root; if he proceed to active movement, he will lose his throne.”

3366x/5.9.2007/jan (*) c. 600 B.C.E.

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The Law of Requisite Variety (*)

For any organization to be successful, a necessary and sufficient set of disciplines (knowing people) must be in play. Each of these contributes a language that will frame decisions and actions. The organization must also structure relationships between the disciplines. Valid organizational design means putting requisite variety into play. It means establishing relationships among the necessary and sufficient set of disciplines to appropriately frame the conversations, decisions, and actions of the organization.

For appropriate regulation, the variety in the regulator must be greater than the variety in the system being regulated. In other words, a system can desplay something only to the extent that it has sufficient internal variety to represent it.

As a system moves toward equilibrium, it tends to become increasingly efficient and insular, rejecting external input. To increase efficiencies, it seeks to reduce variety. Therefore, attempts to increase variety are likely to be misconstrued as inefficient or even as a failure to execute.

3622/2.2.2009/jan (Ref.: Sun, The little grey book) (*) W.Ross Ashby, 1954

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Role of leadership and language in organizations

3621/2.2.2009/jan

An organization is a living organism. It is a set of conversations among people.

Language is the defining environment in which an organization lives. It is how those in the system reach agreement. Language is a medium for organizational growth and change.

Narrowing language increases efficiency. A common shared language helps the organization arrive at decisions more efficiently.Narrowing language increases ignorance. Constrained by a limited vocabulary, the organization becomes unable to adapt to fundamental changes in its environment. Unable to change, the organization eventually declines. Ignorant of our own ignorance, we cannot ask questions outside our ownlanguage experience.

It is possible for an organization to learn and grow only if it creates conditions that help generate new language. Using new language, an organization may create new paths to productivity, and regenerate itself.

The conversations necessaryfor generating new opportunitiescome from outside the system,From the language that has a different history.This is often technically and intellectually demanding and,consequently, often dismissed.

(Ref.: Sun, The little grey book)

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Scoring guidelines for AD items

2271/2.1.2002/jan

Documents

1 Maturity or agility or …? April, 2009 Juhani Anttila Venture Knowledgist Quality Integration, Helsinki, Finland [email protected]@telecon.fi