The People CMM as a Contributor to Organizational Success

1. The People CMM as a Contributor to Organizational Success Palma Buttles-Valdez Member of the Technical Staff Software Engineering Institute Charles Ryan Senior Member of the Technical Staff Software Engineering Institute

2. Agenda • Workforce Issues of the 21st Century • Workforce Issues Impacting Performance and Retention • Overview of the People CMM • Organizational Culture • Holistic Approach to Process Improvement • SEI Model Synergies

3. Workforce Issues of the 21st Century

4. Putting People Back Into the Equation Today, organizations are largely dependent on high-technology to develop, build, and maintain their products and services. This has created a dependence on a workforce with specialized knowledge and skills.

5. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% People: Growing Contributors to Organization Success Organizational Value: Tangible and Intangible Tangible Assets ? 20% Products and Services Intangible Assets 62% People and their cumulative knowledge and skills ? 80% 38% 1982 2002 Current/Future Source: Kirchoff 2006

6. Shrinking & Stabilizing: Labor Force Growth Rate 4.5% 55 years and older 4.0% 3.5% 25 to 54 years 3.0% 16 to 24 years 2.5% 25 – 54 years of age represents the prime-aged labor force 4.0% .4% 2.0% 4.1% 1.5% “One in every three of Lockheed’s employees is over 50, to sustain our talent base, we’re hiring 14,000 people a year. In two years, we’re going to need 29,000 new hires; in three years, 44,000. If this trend continues, over the next decade we will need 142,000.”Robert J. Stevens, Chairman, President and CEO Lockheed Martin, Wall Street Journal April 19, 2006. 2.3% 1.0% .5% .8% .3% .3% 0% .0% -.5% -1.0% -1.0% 2004 - 2014 1984 - 1994 1994 - 2004 1.0% 1.4% National CNP 1.2% Source: Monthly Labor Review 2005; US Bureau of Statistic

7. Baby Boomer Exodus • Between 2010 and 2030 over 78 million baby-boomers, many in key positions, will be eligible for retirement. With the exit of a large segment of the workforce, many organizations may be facing a loss of: • Senior Management • corporate knowledge (“know-how”, soft knowledge, etc.) • customer and product/services intimacy • technical knowledge and skills • mentor • Senior Technical Staff • technical knowledge and skills • product and/or service development knowledge • corporate knowledge (“know-how”, soft knowledge, etc.) • mentor • Senior Administrative Staff • corporate knowledge (“know-how”, soft knowledge, etc.) • mentor • and a potential shift or change in: • Corporate Culture

8. Where are the Baby-Boomers? WA MT ME ND OR MN ID SD WS MA NY MI WY IA PA CN NE NV OH UT IN IL DE CA CO WV VA DC KS MO KY SC TN OK AZ AK NM NC AB GA MS 26.6 -29.3% TX LA 26.1 -26.5% 25.3 -26.0% 19.6 -25.2% Source: AARP Magazine June 2008

9. National, DoD, and Civilian AT&L Workforce “DoD faces significant challenges related to mitigating the pending departure of its highly experienced and seasoned talent – the critical challenge” Frank Anderson, Jr., Director, AT&L Human Capital Initiatives, President, Defense Acquisition University 2007 Source: Anderson 2007, NDIA STEM Initiative Strategy Session

10. Focus on the Software Developer: Age Distribution U.S. Commercial U.S. Government 65 to 74 65 to 74 55 to 64 55 to 64 45 to 54 45 to 54 Age in Years Age in Years 35 to 44 35 to 44 25 to 34 25 to 34 <25 <25 0% 5% 10% 15% 20% 25% 30% 35% 0% 5% 10% 15% 20% 25% 30% 35% Programmer Software Engineer Slide adapted from CSIS 2006, Source: Current Population Survey (August 2006)

11. Workforce Issues: Side Effects • Shortage of workers can place undue pressure on existing workforce, longer hours, etc., • reduces productivity and increases defects • reduces morale and organizational loyalty • Place a strain on Human Resources, • hiring managers, and/or recruiters • competition for experienced/skilled managers • intense competition for skilled and knowledgeable workforce • Federal Sector: Clearance, Clearance, Clearance • Knowledge and skills gap • need to invest in knowledge and skill profiles and assess current capability (competencies) • need to establish or invest in training and development activities

12. Managing Multiple Generations: Cultural Differences Generation X 1965 - 1980 Generation Y 1980 - 2000 Baby-Boomer 1946 - 1964 Traditionalist 1928-1945 • Technically savvy • Prefer informality • Learns quickly • Communicates directly & immediately • Wants structure & direction • Seek work/life balance • Prefer informality • Learn quickly • Embrace diversity • Requires supervision • Indirect communication: email & texting • Seek “demand” work/life balance • Workaholic • Questions authority • Works efficiently • Competitive • No news is good news • Work to live, little balance between work/family • Hard worker • Respects authority • Work is an obligation • Communicates formally & in person • Organizational loyalty • Work & family don’t mix Source: Hammill 2005

13. Workforce Issues Impacting Performance and Retention

14. Workforce Issues: Performance & Retention I • Managers • limited skills/abilities to manage and develop people • Staffing • hired for a job without the required knowledge and skills • job hired is different than job assigned • Training and Development • training to reduce knowledge and skills gaps is not provided, timely, or relevant • training is not keeping up with changes in technology • limited/no opportunities to develop and use new knowledge and skills (growth) • Performance Management • no clear performance objectives, no linkage to committed work • performance problems are not managed • inconsistent rewarding of performance

15. Workforce Issues: Performance & Retention II • Communication • limited/no communication, top down, bottom up, and laterally • inconsistent and vague messages (verbal and behavioral) • Compensation • not linked to performance objectives • rewards for inappropriate behaviors • inequity issues • Work Environment • physical space and resources to perform committed work are not provided or not provided in a timely manner • Organizational Culture • gap between Ideal and Real Culture • culture does not support business objectives or mission goals

16. Misaligned Workforce Practices Communication Training & Development Staffing Performance Management Organizational Culture Compensation

17. The People Capability Maturity Model: Overview

18. People CMM: Introduction The People CMM is a roadmap for implementing workforce practices that continuously improve the capability of an organization’s workforce. It enables organizations to: to attract, develop, organize, motivate, and retain the workforce required to build their products and deliver the services align workforce development with strategic business or mission goals characterize maturity of workforce practices set priorities for improving workforce capability become an employer of choice Curtis, Hefley, & Miller (2001)

19. Continuous Improvement Predicting Capability &Performance People CMM: Process Areas by Maturity Level Level Focus Level Focus Process Area Competency Productivity Continuous Workforce Innovation Organizational Performance Alignment Continuous Capability Improvement 5 Optimizing Mentoring Organizational Capability Management Quantitative Performance Management Competency-Based Assets Empowered Workgroups Competency Integration 4 Predictable Participatory Culture Workgroup Development Competency-Based Practices Career Development Competency Development Workforce Planning Competency Analysis Organizational Competency framework 3 Defined Compensation Training and Development Performance Management Work Environment Communication and Coordination Staffing 2 Managed Basic Management Practices Risk Turnover 1 Initial

20. People Capability Maturity Model: Primary Objective • The primary objective of the People CMM is to improve the capability of an organization’s workforce. • Capability is defined as the level of knowledge,skills, and process abilities available within each workforce competency of the organization to build its products or deliver its services. People CMM CMMI-DEV TSP Performance Workforce capability Process capability enables predicts

21. Defining Workforce Competency • Knowledgerepresents the comprehension acquired by experience and or study. • Skills represents the proficiency or ability in techniques or tools that an individual must be able to demonstrate. • Process abilities is the capacity to perform individual skills in the sequencing or method used in the organization. Process abilities Workforce Competency Knowledge + Skills + =

22. Workforce Competency Staffing by Capability Level I II III IV Software Engineer I Software Engineer III Software Engineer IV Software Engineer II Software Engineer 17 25 12 5 Knowledge: Knowledge: Knowledge: Knowledge: Application domain Procedural design Cobol & assembler Numerical analysis Application domain Procedural design Cobol & assembler Numerical analysis Application domain Procedural design Cobol & assembler Numerical analysis Application domain Procedural design Cobol & assembler Numerical analysis User Training 2 8 4 1 Skills: Skills: Skills: Skills: Requirements analysis System design Project management debugging Requirements analysis System design Project management debugging Requirements analysis System design Project management debugging Requirements analysis System design Project management debugging Process Abilities Process Abilities Process Abilities Process Abilities Current Business Plan Integrated team design Fagan inspections Test procedures Change control Integrated team design Fagan inspections Test procedures Change control Integrated team design Fagan inspections Test procedures Change control Integrated team design Fagan inspections Test procedures Change control Workforce Competency 2010 Staffing Level Needed I II III IV Strategic Business Plan Software Engineer 31 35 18 9 User Training 4 10 8 3 Workforce Competency Example: Software Engineering Current Resource Profile (initial inventory) Current Workforce Needs (one year cycle) Workforce Competency Current Staffing Level Needed I II III IV Software Engineer 23 30 15 7 User Training 4 9 6 2 Strategic Workforce Needs (two to five year) Competency Family Software Engineering

23. People CMM: Focus for Changing Practices Organization develops workforce competencies Organization Organizational Development Professional empowerment Empowered workgroups & measured capability Managers perform repeatable practices Unit and Workgroup Ad hoc, Inconsistent workforce practices Improvement & integration of personal work processes Individual 1 2 3 4 5 Maturity Levels

24. Administrivia Workforce practices considered overhead and are performed hastily Inconsistency Little preparation for managing, developing, or motivating people Ritualistic Workforce practices applied without analysis of impact Turnover Staff not loyal to the organization Culture Chaotic and an impediment to change Attributes of Level 1 Organizations

25. Committed Executives commit to and support workforce improvement efforts Managed Staffing & performance objectives are based on planned commitments Unit-Based Units know and manage their committed work and the effort and skills required Culture Management and workforce buy-in of improvements supports change Attributes of Level 2 Organizations

26. Organizational Organization identifies workforce competencies required by work Strategic Workforce planning develops competencies needed by business Participatory Involvement optimizes impact of competencies on performance Culture Culture that respects professionalism and information sharing Attributes of Level 3 Organizations

27. Enabled Competency enables experience to be transformed into assets Integrated Competency-based processes integrated across disciplines Predictable Workforce capability + process capability predicts performance Culture Culture supports results oriented performance and quality Attributes of Level 4 Organizations

28. Capable Individuals and workgroups continuously improve capability Aligned Performance aligned across workgroups, units, and the organization Continuous improvement of workforce practices and activities Innovative Culture Culture becomes adaptable to changes Attributes of Level 5 Organizations

29. Organizational Culture

30. Concept of Culture • Culture represents the way of life of a group of people. • It is a complex system of socially transmitted behavioral patterns, ideas, norms, symbols, and values that human beings acquire to become members of a society. • Culture is learned, shared, and is essentialto human life and is found universally throughout the world. Culture is fluid “Icame to see, in my time at IBM, that culture isn't just one aspect of the game – it is the game.”Lou V. Gerstner Jr., Former CEO IBM

31. Organizational Culture Nested Subcultures Cross-cutting Cultures Countercultures Subcultures Organizational Culture: Composition • Subcultures • Organizational or Business Units • Management • Competency Communities • Nested Subcultures • Consulting Division • Process Improvement • Lead Appraisers • Crosscutting Cultures • Gender • Ethnic • Administrative Staff • Occupational Cultures (Engineers, Accountants, etc.) • Countercultures • Cultural Deviance The organization is part of a larger cultural system Regional culture National culture Industry culture

32. Learning Culture: Organizational Enculturation Process Individuals are enculturated into an organization through: Observation & & Participation Training/Orientation What is learned: Behaviors Behavioral boundaries; What to do (or not), when to do it (or not), and why Organization communicates a series of values to guide behavior. Unstated values are also learned and shared by members Values Norms Shared understanding of how people should behave; usually unwritten and learned unconsciously Shared assumptions of reality used to rationalize behavior. Can be perpetuated by folk tales and myths - “We are the best at…” Beliefs/Ideas Symbols Language, jargon, and artifacts (building, logos, products, etc.) Culture is the “way we do things here”

33. Holistic Approach to Process Improvement Through Process, Technology, People, and Culture

34. Holistic Approach to Process Improvement A holistic approach to process improvement considers the organization as a whole presumes everything is connected and it is important to understand how and why the parts combine to make a whole • considers Process, Technology, People, and Culture • Approaching process improvement holistically • ensures improvements actions are in alignment with organizational business objectives or mission goals, strategies, policies, and values • enables the organizational culture to becomes a partner in the process improvement effort instead of a barrier

35. A D C Sdfkfaso iahsf sdfkas askf asfsdf dsk fs asd;fkjas;dkf askfas sdjfkn kjasdf jasdf jsf wdfi w[0din as;dhfi asf; anf[I sadifh ai asidn f af as09 d ahdp uhdf phadf uihdf hdh hf hdf d slasd hasdf uhdf sfs uhasfpuas usf smfd ask as asjas s jasf mm s apd kas ns n knsf nfas asdfj ifa[if99hj p iasd ijsdf jsdfij asdfijs ijsij isad[j ia Why Process, Technology, People, and Culture? To implement process improvement activities that are enduring organizations need: the ability to manage and control the complex development, delivery, and maintenance processand the process used to manage and develop the workforce Process the ability to monitor changes in technology and deploy it to make the work efficient Technology a workforce (people) that has the appropriate knowledge, skills, and process abilities (competencies) that are adaptable to rapid changes in a technological environment People • an organizational culture that supports a rapidly changing and potentially volatile market and that is in alignment with policies, business or mission objectives, and strategies Culture

36. SEI Model Synergies Supporting a Holistic Approach

37. Multiple Model Synergies Supporting a Holistic Approach Organizations with a strategic advantage are those that: • attract, develop, organize, motivate, and retain the workforce required to build their products and deliver their services. • develop a workforce with the required knowledge, skills and process abilities. • continuously improve their processes and their ability to manage the development, acquisition, and maintenance of products and services. • align their process improvement objectives with business objectives. • include individuals who measure and analyze their personal software process and who have a quality strategy to manage defects in their work and support quality goals. • develop motivated and committed people and teams that value quality and contribute to the overall success of the organization.

38. CMMI-DEV and People CMM CMM-DEV improves the capability to develop and maintain products and services. People CMM improves the capability of the workforce that develops and maintains products and services. A D C Sdfkfaso iahsf sdfkas askf asfsdf dsk fs asd;fkjas;dkf askfas sdjfkn • Designed for application to practices that contribute directly to the business performance of an organization. • Designed for application to practices that contribute directly to the workforce capability and performance of an organization. • Process • People CMMI-DEV together with People CMM increase an organization's business performance and employee and customer satisfaction.

39. A D C Sdfkfaso iahsf sdfkas askf asfsdf dsk fs asd;fkjas;dkf askfas sdjfkn kjasdf jasdf jsf wdfi w[0din as;dhfi asf; anf[I sadifh ai asidn f af as09 d ahdp uhdf phadf uihdf hdh hf hdf d slasd hasdf uhdf sfs uhasfpuas usf smfd ask as asjas s jasf mm s apd kas ns n knsf nfas asdfj ifa[if99hj p iasd ijsdf jsdfij asdfijs ijsij isad[j ia Summary: of a Holistic Approach Together CMMI-DEV and People CMM can support the elements of a holistic approach to process improvement: Process, Technology, People & Culture Process Enables People Enhances consistency Codifies knowledge Promotes a culture that values discipline Technology Enables process and people Enhances productivity and capability Facilitates communication and coordination People Greatest point of leverage Influence a culture that values excellence Contribute to customer and employee satisfaction Enable change Culture Context in which process improvement occurs Enables the institutionalizion of processes Stabilizes the environment and promotes productivity Reduces barriers

40. Improvement Efforts: Missing Elements for Change Vision Resources Capable Workforce Capable Processes Organizational Culture Incentives Action Plan Change Resources Capable Workforce Capable Processes Organizational Culture Incentives Action Plan Confusion Anxiety & frustration Vision Capable Workforce Capable Processes Organizational Culture Incentives Action Plan Vision Resources Capable Processes Organizational Culture Incentives Action Plan Slow or little progress Vision Resources Capable Workforce Organizational Culture Incentives Action Plan Reinventing the wheel Vision Resources Capable Workforce Capable Processes Incentives Action Plan Barriers to change Vision Resources Capable Workforce Capable Processes Organizational Culture Action Plan Sporadic change Vision Resources Capable Workforce Capable Processes Organizational Culture Incentives False starts Adapted from: Delorise Ambrose, 1987. Personal communication.

41. Final Thought: “It Depends” “It depends” on the process, technology, people, and culture

42. People CMM Courses • Introduction to People CMM • August 6 – 8, 2008 – Washington D.C. • October 22 – 24, 2008 – Vancouver, Washington (week prior to CMMI workshop) • December 8 – 10, 2008 - Pittsburgh, PA • Intermediate Concepts of People CMM • September 8 - 12, 2008 – Frankfurt, Germany • SCAMPI with People CMM Lead Appraiser Training • November 3 – 7, 2008 – Pittsburgh, PA • SCAMPI with People CMM Upgrade Training • Week of October 27, 2008 – Vancouver, Washington

43. Contacting the SEI Presenters Contact Information Palma Buttles-Valdez Member of the Technical Staff Software Engineering Institute +1 512-751-3676 pjb@sei.cmu.edu Charles Ryan Senior Member of the Technical Staff Software Engineering Institute • + 1-412 268-8075 ryan@sei.cmu.edu

44. Bibliography • Anderson, Frank J. 2007. NDIA STEM Initiative Strategy Session. • Curtis, Bill, William E. Hefley, and Sally A. Miller. 2001. The People Capability Maturity Model: Guidelines for Improving the Workforce. SEI Series, Management of Human Resources. Addison Wesley. • September 2006. Department of Defense, Acquisition, Technology and Logistics, AT&L Human Capital Strategic Plan, v1.0, • Dychtwald, Ken, Tamara J. Erickson, Robert Morison. 2006. Workforce Crisis: How to Beat the Coming Shortage of Skills and Talent. Harvard Business School Press. • Employment Policy Foundation. 2002 , The Seventh-Annual Workplace Report, Challenges Facing the American Workplace, Summary of Findings. • Hammill, Greg. 2005. Mixing and Managing Four Generations of Employees. FDU Magazine online, Winter/Spring 2005. http://www.fdu.edu/newspubs/magazine/05ws/generations.htm • Kirchoff, John 2006. Why Performance Management Improves Human Capital ROI. SHRM Research. • Kleyman, Paul. 2006. Boomers to Redefine Workplace. In: Aging Today: The bimonthly newspaper of the American Society on again, Vol. 25.No.26

45. Bibliography - 2 • SHRM 2003. Older Worker Survey. www.shrm.com • Toossi, Mitra. 2005. Monthly Labor Review, November 2005. Labor Force Projections to 2014: Retiring Boomers. US Department of Labor Bureau of Labor Statistics 2005. • Humphrey, Watts S. 1989. Managing the Software Process. Reading, MA. Addison-Wesley.

46. People CMM Model Components Process Area Purpose Statement Purpose Description Implementation Goals Institutionalization Goal Institutionalization Practices Implementation Practices Subpractices Supplementary Information Supplementary Information Subpractices Expected Key: Informative Required Adapted from CMMI v1.2 Figure 2.1