Two of the world's largest consumers of technology, General Motors and the US Department of Defense, are backing a set of best practices for buying software and services, which they believe will reduce risks and costs of IT projects.
The standards were developed by the Carnegie Mellon Software Engineering Institute (SEI) in conjunction with technology users and vendors. But the leading advocate for it has been Ralph Szygenda, CIO and group vice president of GM.
"I think this has gone a long way to standardize some processes, so that both the supplier and acquirer are speaking the same language," said Szygenda.
Szygenda, along with Kristen Baldwin, deputy directory of the office of US Secretary of Defense, Paul Nielsen, SEI director and CEO, and others from the government and the IT industry, announced these standards in a teleconference last week.
Szygenda said he was confident that this new standard "will fast become the model of choice for IT acquisition and supply chain management," he said. Standardizing IT acquisition globally "will improve productivity, quality and reliability."
What has been developed is a new Capability Maturity Model Integration (CMMI) that focuses on acquisition, officially known as CMMI-ACQ. The CMMI framework, which is widely used in software development, sets a common language as well as processes and management structures that vendors and buyers can both use in an acquisition.
Grow up, IT industry
Szygenda has previously called the IT industry "immature" compared to other industries with which his company works to build vehicles. GM, which last year outsourced some US$15 billion worth of IT work over five years, requires all its vendors to follow a common set of practices.
At GM, "we have very few programs that get into trouble, very few programs that are late and very few programs that run over," said Szygenda, who credits uniform best practices for that. Development work at GM is set at a fixed price, "which is a very unusual model in any industry, so the supplier base and GM have learned how to make sure our requirements are right," he said.
"I think this is new for a lot of companies," said Szygenda. In 2004, he added, GM was "buying more than we were building but didn't have the processes in place, the acquisition standards in place."
The Defense Department piloted the program, said Baldwin, and intends to make it available to the military as a model for deploying best practices. It will include training. The department won't require the new CMMI framework to be used. She said: "We simply want to approach it as a way to distribute the knowledge of good acquisition best practices."
Blessed by the GAO?
The US government has seen some spectacular software failures, such as the FBI's US$170 million virtual case file project. The agency that has been the most vocal critic of government IT management and an advocate of best practices is the Government Accountability Office. Keith Rhodes, the GAO's chief technologist, was also on hand to give his endorsement, and in doing so, may have signaled other government departments and agencies to pay attention to the new standard.
"Anyone who is interested in process improvement, especially in the acquisition world, should consider adopting CMMI for acquisition," said Rhodes.
Vendors have largely embraced CMMI practices. Offshore outsourcing firms, in particular, have cited the framework as a selling point when offering services to U.S customers.
Officials from Hewlett-Packard and Capgemini, which are major suppliers to both GM and the DOD, were also on the call to give their support for the purchasing standard.
John McCain, senior vice president and general manger of HP Services, said the model will help CIOs manage projects that include acquisitions. Sometimes CIOs run into problems when details of a project aren't passed along to suppliers or technologies don't quite fit the requirements. The new model, McCain said, will allows vendors and users "to truly focus on a common set of objectives, speak, language, communication -- really a common process for us to stay better interlocked."