1. Software Process Improvement (SPI) Cost and ROI Ikram Ahmed Khan Business Beam (Pvt.) Limited [email_address]

9. What Improved Maturity can do for your Organization? Based on data from 1300 applications, average 200,000 SLOC Source: Master Systems, Inc., Data obtained from QSM Database, QSM, Inc. Presented by: Rodger C. Blair, Pittsburgh PMI Chapter, April 12, 2001 0.93M $0.52$ $0.73M 80 person months 15 7 3 $1.7M $0.96M $1.3M 143 person months 18.5 12 2 $100+M $1.8M $5.5M 600 person months 30 61 1 Highest Cost Lowest Cost Median Cost Level of Efforts Calendar Months Defects Shipped CMM Level

10. What Improved Maturity can do for your Organization? (2) * Cost per unit is measured in dollars (median cost) per source line of code ($ per SLOC) produced. ** Programmer productivity is measured in number lines of code produced per programmer per month (SLOC per programmer per month). 3.5 defects every 1000 SLOC (1.00) 2500 (7.5) $3.75 (1.00) 3 7.5 defects every 1000 SLOC (2.14) 1399 (4.2) $6.5 (1.73) 2 30 defects every 1000 SLOC (8.58) 333 (1.00) $27.5 (7.3) 1 Average Defect Density Average Programmer’s Productivity ** Average Unit Cost * CMM Level

12. Case Study 1: Raytheon Savings due to CMM level 3 SPI Efforts! | | | | | | | | | | | | | | | | | | | JAN MAY SEP JAN MAY SEP JAN MAY SEP JAN MAY SEP JAN MAY SEP JAN MAY SEP 1987 1988 1989 1990 1991 1992 0 5 10 15 20 25 30 35 40 45 50 Percentage of Total Project Cost Cost of Rework $15.8 Million Saved on $2.05M SPI Investment Start of SPI Initiative 41% 11%

15. Case Study 2: SAIC CMM Level 2 SPI Results 20% 40% 60% 80% 100% V4.1 V4.2 Established Baseline Achieved CMM Level 2 Percentage Improvement x Cost dropped 30% x Cycle-time dropped 46% B x Error-rate dropped 90%

17. SPI Example 1: Software Process without Inspections Requirements Design Code Unit Test Integration Testing Systems / Acceptance Test Rework Rework 100 + 100 + 100 + Production Rework Rework Rework Rework Rework Rework 100 ++

18. SPI Example 1: Software Process with Inspections Requirements Inspection Rework Design Inspection Rework Code Inspection Rework Unit Test Integration Testing Systems / Acceptance Test Requirements Design Code 1 1 1 Production

21. Cost of SPI Efforts (cont…) 2 4 6 8 10 12 14 16 18 20 Cost of Defect Removal (Rs. in 000) Defect Removal Stage Req. Analysis Design Code Test Acceptance Operations Code Defects Design Defects Analysis Defects Req. Defects

26. Thank you! You may find this presentation at: www.businessbeam.com