MATURING ORGANIZATIONS, CONVERGING TECHNOLOGIES

by

Dimitris Kosmidis

A thesis submitted in partial fulfilment of the requirements for

Technoscope

National Technical University of Athens – Athens University of

Economics and Business – National School of Public Health, Athens

2003

Approved by Emm. Koukios _______________________________________ Chairperson of Supervisory Committee

N. Tsounis _________________________________________

I. Katsoulakos ______________________________________

A. Bartzokas _______________________________________

Program Entitled to Offer Advanced Studies Diploma in Technology Management, - part of the European Master in “Society, Science and Technology” _________

Date 18th of April, 2003 ___________________________________________

National Technical University of

Athens – Athens University of

Economics and Business –

National School of Public Health,

Athens

Abstract

MATURING ORGANIZATIONS, CONVERGING TECHNOLOGIES

by Dimitris Kosmidis

Chairperson of the Supervisory Committee:Professor Emm. Koukios Department of Chemical Engineering, -Bioresource Technology Unit,

NTUA

Evolving Corporate Procedures, Adapting Contemporary IT Solutions,

Building Socio-Cultural Welfare.

An Architectural Concept snapshot, through the prism of the

Human Resources Department of INTRACOM SA

TABLE OF CONTENTS

Table of Contents.................................................................................................. i Acknowledgments ............................................................................................... ii Glossary .............................................................................................................. iii Chapter 1.............................................................................................................. 1 Preface.................................................................................................................. 1 Chapter 2.............................................................................................................. 3 The Business Framework .................................................................................... 3 1 The Need for Application Integration........................................................... 3

1.1 The Application Integration Environment ....................................... 3 1.2 The Post Internet Boom and .com Bubble Situation ....................... 4

2 The Economic Aspect ................................................................................... 5 2.1 Funding ............................................................................................. 6

Chapter 3.............................................................................................................. 7 The Technology Issue.......................................................................................... 7 3 Revising all Technical Issues........................................................................ 7

3.1 Business and Application Integration Delivery ............................... 8 3.2 Communication Protocols ................................................................ 9 3.3 Grid Computing .............................................................................. 10 3.4 OLTP............................................................................................... 10 3.5 OLAP, Data Mining and Knowledge Warehouses........................ 10

4 SAP .............................................................................................................. 11 4.1 SAP Human Resources Solution.................................................... 11 4.2 SAP Human Resources Key Capabilities ...................................... 12

Chapter 4............................................................................................................ 13 The Environmental Aspect................................................................................ 13 5 The People Capability Maturity Model (People-CMM) ....................... 13

5.1 Organizational Maturity and Maturity Levels ............................... 13 5.2 P-CMM Process Areas and Process Area Threads........................ 14 5.3 The Overall Architecture ................................................................ 14

6 Sustainability ............................................................................................... 15 Chapter 5............................................................................................................ 16 Conclusion ......................................................................................................... 16 Links...................................................................................................................... i Bibliography ........................................................................................................ ii

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ACKNOWLEDGMENTS

INTRACOM ΑΕ is the largest provider of telecommunication, information

and defense electronic systems in Greece.

SAP AG, Systems Applications Products in Data Processing.

The Software Engineering Institute (SEI) is a federally funded research and

development center sponsored by the U.S. Department of Defense and

operated by Carnegie Mellon University (CMU).

People Capability Maturity Model (P-CMM) is registered in the U.S.

Patent and Trademark Office. SAP, the SAP logo and all other SAP

products and services are trademarks of SAP AG. Any other product or

service name mentioned herein is trademark of its respective owner.

Special thanks to the ones provided valuable input, guidance and support.

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GLOSSARY1

Abilities. Abilities are enduring attributes of an individual that influence performance.

API. Application Programming Interface (API) is an interface that applications use to offer web or other services and to communicate with each other.

B2B, B2C, B2E B2G. Business to Business, Business to Consumer, Business to Employee, Business to Government

BAPI. Business Application Programming Interface (BAPI) is an open, stable, object-oriented interface, through which capabilities of mySAP.com can be accessed.

BCA. Business Case Analysis

BI. Business Intelligence is a broad field containing technologies as Decision Support Systems (DSS), Executive Information Systems (EIS), On-Line Analytical Processing (OLAP), Relational OLAP, Multi-Dimensional OLAP, Hybrid OLAP or combinations. BI can be broken down to, Multi-dimensional Analysis Tools, Query Tools, Data Mining Tools and Data Visualization Tools.

BPR. Business Process Re-engineering (Redesign)

Business Process. Business Process is the execution of one or several services in a controlled way, driven by one or several individuals or events.

BPML. Business Process Modeling Language

CBA. Cost Benefit Analysis

Competence. Competence is the ability to acquire, use, develop and share knowledge, skills and experiences.

CORBA. Common Object Request Broker Architecture

1 Definitions and formulas outlined herein with the only intention to facilitate reading comprehension

of the document. They are not meant to substitute original meaning of terms or complete scientific definitions in no case, nor whatsoever.

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CRM. Customer Relationship Management

Data. Data is factual information with no specific meaning, used for analysis and reasoning purposes.

Data Mart. Data Mart is a database that provides the data needed by a centralized function in the organization.

Data Mining. Data Mining is a process of discovering and interpreting previously unknown patterns in data. Data Mining leverages artificial intelligence and statistical techniques to build models, -from situations where the outcome is well known.

DCOM. Distributed Component Object Model

Deep Computing. Deep Computing is the application of computational methods to large data sets, to solve business decision problems.

DW. Data Warehouse is a centralized repository of all the data relevant to all subjects in which business users are interested.

Enterprise Portal. Enterprise Portal is a single point of entry to all information, applications and services that people need to do their jobs according to their roles. Enterprise Portals provide a way for suppliers, customers, partners and employees to access all relevant content easily and securely and to participate in all types of business processes.

ERP. Enterprise Resource Planning

Experience. Experience relates to previous activities; explicitly linked to certain types of work activities.

FTE. Full Time Equivalent is the process cycle requirements, -resources, for a specific job task to be completed.

FTP. File Transfer Protocol

HTML. Hyper Text Markup Language

HTTP. Hyper Text Transfer Protocol

ICT. Information and Communication Technologies

Info Cubes. Info Cubes are logical groupings to hold data and allow for data aggregation.

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Information. Information is a collection of facts or data, with a specific meaning when they are properly interpreted.

IRR. Internal Rate of Return is the discount rate that makes the NPV of an investment zero.

0 = initial Outlay + (Cash Flow Year 1/IRR 1) + (Cash Flow Year 1/IRR 2) + (Cash Flow Year 1/RR n)

Knowledge. Knowledge is organized sets of principles and facts that apply to a wide range of situations.

NPV. Net Present Value is the difference between an investment’s market value and its cost; -acceptable for an investment decision is considered only a positive NPV. NPV is calculated by the present value of the future cash flows and then subtracting the costs.

NPV = -Initial Investment + Future Net Cash Flows / (1 + required Return) Time

OLAP. On-line Analytical Processing enables users to easily and selectively extract and view data from different points of view. To facilitate this kind of analysis, OLAP data is stored in multidimensional databases.

OLTP. On-Line Transactional Processing

OOP. Object Oriented Programming

Payback Period. Payback Period is the amount of time required for an investment to generate cash flows sufficient to recover its initial cost, or the elapsed time before the initial cost is equaled by the financial payoffs, -delimited on a chart projection by the break-even point.

P-CMM. The People Capability Maturity Model (People-CMM)

PLM. Product Life-cycle Management

ROI. Return on Investment is an estimate of the financial benefit (Return) on money spent (Investment) on a particular alternative.

RPC. Remote Procedure Call

SCM. Supply Chain Management

SEM. Strategic Enterprise Management

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Skills. Skills are developed capacities that facilitate learning and the performance of activities that occur across jobs.

SMTP. Simple Mail Transfer Protocol is an open protocol for exchanging electronic mail.

SOAP. Simple Object Access Protocol is a lightweight protocol for exchanging information in a decentralized, distributed environment. It is an XML-based protocol that is typically used with HTTP. SOAP includes conventions to represent method calls of objects or function calls and their respective responses, as well as conventions to represent standardized data types.

SSL. Secure Sockets Layer is a standard protocol for transmitting secure messages over the Internet using public-key and private-key encryption.

SWOT Analysis. Strengths Weaknesses Opportunities Threats Analysis

TCO. Total Cost of Ownership is an attempt oriented towards the comprehensive and quantitative capture, of expenditures related to technology decisions. To the IT the community, this includes the total cost of acquiring / developing, installing, implementing / integrating, using, maintaining and replacing a system / IT solution across an extended period of time, -most or all of its useful life.

TQM. Total Quality Management

UDDI. Universal Discovery Description and Integration is an industry initiative to create a platform independent, open framework for describing web services, discovering business, and integrating business services using the Internet. Its purpose is to create an open registry.

UML. Unified Modeling Language is a tool, which helps to specify, visualize, and document models of software or non-software systems, including their structure and design.

XBRL. eXtensible Business Reporting Language is an open specification that uses XML-based data tags to describe financial statements for both public and private companies.

XML. eXtensible Markup Language is the universal format for structured documents and data on the web; XML is increasingly becoming the general standard document format of structured data.

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C h a p t e r 1

PREFACE

Computer systems or other said, information technology solutions

available to business, have been evolved, from the first generation large-

scale integration, post-processing mainframe systems of the early-70’s, to

down-sized, scalable real-time systems, featuring decentralized processing,

relational database and client-server architectures by the mid-80’s, utilizing

the available then PC and mini-computer technologies. Since the late-90’s,

we witness the on-going evolution of Internet and the accompanying N-tier

architecture, which integrates corporate-wide systems to numerous tailor-

made, and vertical industry solutions, implementing mission-critical

applications, through the facilitation of web computing over traditional

platforms. In our days there is an emerging need for the appearance of the

next generation Internet technology (Internet2), which is expected to

provide, extended scalability, robustness, security, flexibility, mobility,

openness and accessibility. The future is about fast broadband,

permanently connected solutions. It is about non-interrupted user access

from anywhere and at any time, -the utilization of existing network

facilities and the establishment of new ones, like wireless and mobile.

Intelligent infrastructure and deep computing is expected to interact with

natural, -rich media applications, ensuring seamless collaboration of

versatile technologies. Easy and trusted resources based on open, evolving

standards, will secure all commenced transactions and the privacy of

community members.

Through this past period, ICT has gradually evolved, spreading in a few

“twelve-year” cycles, from scientists and labs, to highly specialized staff in

large organizations and clean-room computing environments. Individuals, -

2

the generation-X, with home entertainment stand-alone machinery, and

professional users with networked computers for business applications,

have now become communities of interest, -peer groups on the web. In the

afore-mentioned evolutionary process, technology has interacted

differently with society, -business and people. The urge to standardize the

technological framework, the ability to perceive existing ethics and define

new socially accepted boundaries under regulatory reforms arise in almost

every day’s activity. The environment where technological outcome turns

from gadget to commodity and side-affect turns to be a need is the same

environment that visualizes the innovative “next utility” of the era. On top

of that, well-established attributes and behaviors are passing phases of

redefinition, i.e. quality and utility. The option is simple and seems to lie

between expanding, -apply new technology and disseminate goods and

services for society to prosper, or decline and fade-out. Even further,

society’s response to non-defined, non-contextual, non-standardized and

non-conventional needs seems to lead technology! Typical examples are

coming from wide consumer industry sectors, like communications,

banking, health and insurance, where products and services are offered, -

produced “on demand”, but they are available “well in advance”. Plenty

other such cases exist, and though they are hard to identify in first place,

they contain the dynamics to attract remarkable magnitudes of resources,

like capital.

The spectrum of business, people and technology, expanding from the

“dedicated few” to a “holistic match” is outlined in this paper, through the

synthetic composition of a wide range of resources, methods and solutions.

The outcome balances the contents of a white paper and the thesis

requested, I hope.

3

C h a p t e r 2

THE BUSINESS FRAMEWORK

Enterprise2 integration is to provide timely and accurate

exchange of consistent information between business

functions, to support strategic and tactical business goals,

in a manner that appears to be seamless [sei].

1 The Need for Application Integration

The need for organizations internally, to make their different applications

inter-work, is known as intra-business integration. Most lately, there is

increasing need for inter-business integration, -also known as B2B

integration, which is about different organizations having their own

applications inter-work across their traditional organizational boundaries,

often covering aspects of B2G and B2C.

1.1 The Application Integration Environment

Intra-business applications seem at first, as the most common target for

application integration. Someone could expect that for B2E applications, -

like formal Human Resources, service delivery would become simpler

“under one master”. Yet this is true, rarely much attention was put towards

such integration efforts in the past. Instead, “of-the-self” or “custom-built”

solutions, -most often systems originated form unplanned, stovepipe

“batch” and “single-tier” development, generated vicious sources of non-

synchronized data, multitudes of policies and business processes. Business-

2 The term “enterprise” can be ambiguous; it has been referred to variously at the level of a division,

a strategic business unit, a profit centre, a public sector agency, and a corporation. We refer to any one of them in this document, as “organization”.

4

workflows were treated erroneously in a discrete manner. Consequently,

there were increased needs for trust resources, -in the name of extended

data store and security. Such systems’ access and management needs,

ownership and authorization rights, -aspects described under the generic

term “usability”, tend to become increasingly complicated when made

available organizationally wide, -requiring multi-sign log-ins, increased

process and maintenance times etc. The need for an integrated and

automated cross-organizational flow of information is not questionable any

more, due to the fact that daily activities are performed in open,

competitive working environments and highly complex market places,

involving B2E, B2B, B2C, even B2G.

1.2 The Post Internet Boom and .com Bubble Situation

Although the Internet hype boom has faded away, the challenge of how to

conduct and drive business value from technology investments remains

critical. In order to grow and maintain the competitive advantage,

organizations need to be fast enough, flexible and efficient. Products and

services must be available and offered upon request. Needs must be

identified timely. Even more, they must automatically generate “ripple

effects”, -through the offering of eligible solutions, across various groups

of interest. The approach is summarized in today’s offering of highly

granular set of services over the Internet. The need of tight integration,

streamlined to business processes seems critical to success. Additionally,

everything must be done without losing sight of the core business, -from

top to bottom.

IBM’s on demand services “life event” model, built on the “life event”

concept, relates systems and services to the instance and flow of time. The

model shows the conjunction in between knowledge, infrastructure and

business processes. Implementation of solutions involving factors such as

information, transaction, interaction, -including scenario-based approaches

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and deep computing, exist on variable infrastructure and complexity value

bases. A typical initiative of such kind is outlined in the action plan for e-

Europe, showing the initial agreement and commitment of member states,

to offer an overall number of 20 basic public services, 12 addressed to

citizens and 8 to business. All these services shall be measurable through a

four-stage framework, -on-line posting of information, one-way

interaction, two-way interaction and fully on-line transactions, including

delivery and payment.

2 The Economic Aspect

Common practice, while introducing new technology solutions today, is

the conducting of BCA(s) or smaller scale CBA(s). High-level decision

support tools, named “value calculators”, -involving “key metrics” and

“indicators”, project the economic impact on the organization, prior to any

decision-making. They relate fixed or variable environmental attributes

“before”, “during” and “after” the phased introduction of enterprise-wide

software solutions, -covered under specific business scenarios. SWOT

analysis methodologies, examine past operations, analyze present

conditions and gather information about the future, from the operating

environment. Business drivers with direct affect to change, like benefit,

cost and various risk factors, are considered, in order to support the

preferred solution or any other existing alternative. They are all outlined in

technical and financial statements, and summarized in executive ones.

They are driven from models forming a common base to most traditional

industry sectors, like Porter’s Five Forces, namely, the Bargaining Power

of Suppliers, the Bargaining Power of Customers, the Threat of New

Entrants, the Threat of Substitutes and the Competitive Rivalry between

Existing Players.

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2.1 Funding

There are several aspects to consider before concluding to the preferred

alternative, in order to ensure a decision without inherited drawbacks.

Firstly, investments of large scale should clearly support the core / priority

mission functions of the organization. This includes compliance to existing

systems, methods and procedures or the absolute commitment of all

involved parties to the evolutionary process entailed to the adoption of

novel solutions, other said, appropriate BPR / TQM preparation and effort.

The projected ROI shall be clearly equal to, or better than existing systems

and resources, or of any other alternative. Pay-offs may be distinguished

into two major categories, tangible, -referring to the ones associated with

monetary savings, and intangible, -referring to pay-offs entailing a

significant value, which cannot be described with monetary terms. In order

to measure the financial benefits, the three key themes of any ROI analysis

shall be conducted; benefits determination, cost calculation and finally

formulation and summarizing of results. Benefits determination is

described as a breakdown procedure, necessary to measure process time, -

due to the streamlining of a business processes. It is calculated in FTE(s)

and involves detailed focus in major activities of the target organization.

Cost calculation is about estimating the TCO of specific business elements.

Some other aspects to consider, -for a feasible investment, include efforts

addressed towards securing the successful delivery of the solution,

minimizing any potential adverse consequences and the establishment of

clear measures and accountability for the undertaking introduction project.

An appropriate acquisition strategy will also consider, the available market

competition, a balanced contract payment and the reduction of possible

technological risks, -utilizing proven and well-established commercial

technology in most such cases.

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C h a p t e r 3

THE TECHNOLOGY ISSUE

Technology is the application of knowledge, to develop the

means our society requires to run, -a combination of

science, art, engineering, economics and social studies

brought together with creativity and ingenuity to improve

the quality of our lives. It is about making our world a

better place to live in […from the Technoscope 2003].

3 Revising all Technical Issues

Application Integration relates Requirements and Principles. Functional or

non-functional requirements, ought to be traceable to one or more business

drivers, while modeling organizational solutions, -i.e. UML, UDDI.

Business Integration is about design and modeling business processes,

taking proper TQM / BPR decisions. Presentation Integration incorporates

business knowledge to business logic, under business processes. It helps

organizations share resources among their main constituents; -these are

employees, customers, partners and suppliers. Data Integration deals with

the modeling and purposeful use of data. It is about normalizing and

validating data in first place, integrating them through controlled exchange

between internal applications and securing them with authorized access

from outside systems. Control Integration deals with how “message

exchange” is handled between applications, -based on the different modes

of communication protocols, -i.e. FTP, SMTP, HTTP, SOAP, etc.

Connectivity relates workflow, data and services, and how “bridges” and

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“gateways” conduct this. Finally there are Quality Attributes to consider, -

referring to architectural decisions influencing quality characteristics such

as performance, dependability and security (SSL).

3.1 Business and Application Integration Delivery

Business integration may be attained in numerous ways, mainly depending

on how business scenarios are implemented. On technical terms, this

means that organizational architecture forms essentially a planning activity,

rather than a development one. Replacing all existing legacy systems or

rewriting all business applications is the most obvious potential alternative

when the organization reaches a certain maturity stage, and when

technology can accommodate clearly defined needs, dismiss obsolete

requirements and over-ambiguous demands, unify business processes and

secure added value3. The overall investment, the size of the new solution,

the adaptability to changing business needs and the culture of the

organization, comprise major issues to be considered, when faced with the

challenge to adopt business-wide solutions like the ones offered today

under the generic designation of ERP, CRM, SCM, etc. Leave “what

works” in place and provide “linkages” to these “already working parts”

through API(s), on the other hand, may be a viable approach, which is

usually not as simple to implement, as it seems in first place. It is common

tendency for the provided “middleware” to become increasingly

complicated, mostly depending on factors such as the nature of the solution

itself, the technology used by other legacy systems and the actual amount

of applications to be interconnected. Trying to assure information

integration, someone would propose to work towards numerous bi-

directional crossovers, a solution of doubtful delivered manageability and

functionality in real working-places. Following the approach of telephone

organizations, dispatching human operators acting as middleware for

3 Added value is meant not only in economic terms but also in any potential aspect indicating gain or

securing the competitive advantage, within the value chain of a product, service or solution.

9

automated switches, (routing hubs), -when the volume of telephone lines

indicated the limitations of the existing system, software industry

implemented its own equivalent. Referred to as “message brokers”,

“integration brokers” or “application brokers”, such “hubs” enable

connections to be made between multiple systems and applications,

dramatically simplifying the equation, n (n - 1) of previously assumed bi-

directional connections required, -for each application connected to each

one of the rest, down to a manageable 2 n per application system

connected. The notion of intermediary working between two “master”

applications does not ensure successful service delivery on its own. IBM

discusses Five Axes for the successful application integration of such kind,

namely, Messaging, Transaction Processing, Process Management,

Development (or Creation of Application Integration and Production (or

the Operation of what has been Developed). It is worth emphasizing, that

after “broking”, “integration between applications” comes with the

process-flow automation. Process-flow automation involves business

people, -using revolutionary BPR strategies or evolutionary TQM

techniques, rather than IT specialists. The aspiration is that no technical

details are needed in order to integrate these applications.

3.2 Communication Protocols

It is important for today’s application development, -“procedural” OOP or

other, to ensure Internet communication. Application communication, is

facilitated through RPC(s) between objects like DCOM and CORBA,

representing a compatibility and security problem, -in other words traffic

which firewalls and proxy servers will normally intercept. HTTP is

commonly used for application communication; -since all Internet

browsers and servers support it. SOAP, has been especially designed to

communicate between applications running on different operating systems,

developed with different technologies and programming languages. Since

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HTTP is just about displaying information, SOAP messages are encoded in

XML.

3.3 Grid Computing

Grid computing can be defined as applying resources from many

computers on a network, -at the same time, to a single problem, usually a

problem that requires a large number of processing cycles or access to

large amounts of data. Through the utilization of grid technologies,

organizations can unite disparate technology capabilities to create a single

unified system, -enabling virtual sharing, management and access to

resources across an enterprise, industry or community. Grid computing

helps placing all necessary IT resources, to the disposal of the ones who

need it, at that very moment. When applied, grid solutions can help

organizations to break through infrastructure limitations, in order to solve

complex business problems like R&D, engineering, product design, and

financial analytics.

3.4 OLTP

On-Line Transaction Processing (OLTP) is the type of computer

processing, in which the computer immediately responds to user requests.

Each request is considered to be a transaction. OLTP forms major

architectural consideration and capability of computer systems today.

While OLTP requires interaction with a user, “batch” processing processes

large numbers of previously stored transactions, as whole, off-line.

3.5 OLAP, Data Mining and Knowledge Warehouses

3.5.1 Info Cubes and Data Marts

Info Cubes form the primary structure used in the implementation of a DW

or a Business Information Warehouse. Key numeric measures, called facts,

are stored in a central table, which have a number of characteristic

dimensions, -including time dimensions, unit dimensions and data packet

dimensions. Several different dimensions can be used to analyze facts, thus

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giving rise to the image of a cube. Info Cubes facilitate end-user creation

of ad-hock reports and queries, using advanced extraction, transformation

and loading techniques, and maximize system performance, because they

store and access data using relational databases and star-schema models

(multidimensional indexing)

4 SAP

In today’s knowledge-based economy, companies need to

fully leverage their human capital to sustain a competitive

position [sap -human capital management].

4.1 SAP Human Resources Solution

From a business analyst aspect, mySAP Human Resources is the

application component of mySAP.com ERP solution, addressed to Human

Resources Organizations. The HR solution comprises elements of:

Core Functions, containing the modules of:

Personnel Administration

Organizational Management

Time Management

Payroll

Legal and Compliance Reporting

Strategy, containing the modules of:

Organizational Development

Recruitment

Workforce Management

Training and Employee Development

Total Reward

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Analytics, containing the modules of:

Workforce Analysis

Strategic Alignment

Reporting and Benchmarking

Enabling Solutions, containing various modules such us:

Collaborative Business Networks

Employee Self-Service

Manager’s Desktop

Workplace and Business Portals

The ultimate goal of a portal is to deliver information; -that

is content [ovum]

4.2 SAP Human Resources Key Capabilities

Workforce operations, sourcing and deployment, workforce alignment,

business analytics, planning and services are key thematic areas covered

with the implementation of the full mySAP HR solution.

Employee life-cycle management handles any possible situation and event,

-from the beginning to the end of a relation between an individual and the

associated organization. Employee relationship management enables the

collaboration of the organization’s constituents, -through utilization of

technology and knowledge management. Workforce analytics offers the

tools necessary to monitor, analyze and optimize resources and business

practices, in order to secure the corporate strategy. Finally, employee

transaction management provides all the tools needed to support the

transactions and secure compliance to requirements.

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C h a p t e r 4

THE ENVIRONMENTAL ASPECT4

The People Capability Maturity Model (People-CMM) is

a framework that helps organizations to successfully

address their critical people issues [sei].

5 The People Capability Maturity Model (People-CMM)

Organizations’ ability to compete is directly related to their ability to

attract, develop, motivate, organize and retain talented people. As a

roadmap for implementing workforce practices that continuously improve

the capabilities of an organization’s workforce, P-CMM draws on the

topics of capability maturity models, benchmark high performance

workforce practices and organizational improvement to increase

organization’s workforce capability5.

5.1 Organizational Maturity and Maturity Levels

Initial – Managed – Defined – Predicable - Optimizing

As an organizational change model, P-CMM is designed on the premise

that improved workforce practices will not survive unless an organization’s

behavior changes to support them. The maturity framework is based on

three major domains; processes, practices -TQM / BPR and organizational

change.

4 People and society. 5 Workforce capability can be defined as the level of knowledge, skills, and process abilities

available for programming an organization’s business activities.

14

Maturity levels in P-CMM represent organizational capability. Each one of

the five levels, entail different behavioral characteristics. From the Initial

level –maturity level 1, up to the Optimizing level –maturity level 5,

organizations deal initially with inconsistent management through

repeatable practices, and then people management through competence-

based practices. Later on, such practices get measured, empowered and

improved, in order to lead to highly capable and changing organizations.

5.2 P-CMM Process Areas and Process Area Threads

P-CMM maturity levels consist of several horizontal process areas, -

clusters of related practices, distinct between levels. When process areas

are performed collectively, they lead to enhanced workforce capability.

Process area threads, -are meant as four vertical areas, common between

the five maturity levels, which form the common ground for process

transformation and transparency.

5.3 The Overall Architecture

Maturity levels, (key) Process areas, Goals, (key) Practices

Trying to follow on how P-CMM components are structured, someone

could describe the following chain. Maturity levels, -indicating workforce

capability, contain process areas, -“key” functions achieving goals.

Process areas, are organized by common features, -process area threads

that address implementation efforts within the organization. These common

features contain key practices, which are describing the infrastructure and

the activities performed by the organization.

A practice cannot be improved if it cannot be repeated,

[Principles Underlying the Maturity Framework].

Certain organizational management factors interpret practices. It is the

organization’s ability to perform, -policy, the practices performed, -plans,

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measurement and analysis, and verification of the implementation. Once

again, there is a “life cycle” model in use, -the IDEAL model, a five-

phased approach, for driving continuous improvement in the organization.

It is based on the distinct phases following any stimulus for change,

namely Initiating, Diagnosing, Establishing, Acting and Learning An

additional sixth phase, -the overall task management, runs throughout the

span of the change process. The model is based on Shewart-Deming

improvement cycles of plan – do – check – act. The overall process

integrates with the Kaplan & Norton Balanced Scorecard.

6 Sustainability

Businesses in our days go far beyond the traditional workplace. “Social

Responsibility”, “Ethical Operations”, “Contribution to Society”, “Health

and Safety”, “Environmental Consciousness” are increasingly weighted

issues, affecting directly or indirectly a company’s existence and capacity

to operate in an ecosystem. Compliance to international standards, the

broader contribution to society, -through proper activities justified by the

needs and the nature of the business sector or the operating environment,

add value and goodwill to organizations. Providing opportunities, avoiding

exclusions and distributing wealth in a sensible manner are valuable efforts

headed towards the built of trust and stabilization of the operating

environment. They lead to a further reduction of instability, uncertainty

and risk; organizations are meant to deal with.

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C h a p t e r 5

CONCLUSION

Technology today offers the means to institutionalize procedures with

structural changes, -the technological breakthrough needed by the unified

collaborative environments we operate in, -business or other. It is a matter

of the inspiring vision, the value of the leading drivers, the clarity of the

strategies and the commitment to the roadmap of the evolving procedure,

which secure the desired deliverables. Deliverables meant to be addressed

to people, ensuring prosperity to society.

i

LINKS

http://europa.eu.int The European Union On-line

http://online.onetcenter.org/ Occupational Information Network O*NET Online

http://www.hr.com/hrcom HR.com Human Resources Management

http://www.ibm.com International Business Machines Corporation

http://ww.ilo.org International Labour Organization

http://www.opm.gov U.S. Office of Personnel Management

http://www.ovum.com Ovum is the largest European headquartered advisor on telecoms, software and IT services.

http://www.peoplesoft.com Peoplesoft

http://www.sap.com/solutions/hr mySAP Human Resources, Human Capital Management (HCM) for Business

http://www.sei.cmu.edu Carnegie Mellon –Software Engineering Institute

http://www.w3.org World Wide Web Consortium

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BIBLIOGRAPHY

Becker, B. E.; Huselid, M. A.; & Ulrich, D. The HR Scorecard: Linking People, Strategy, and Performance. Boston, MA: Harvard Business School Press, 2001

Brett, C. The HR Scorecard: The Five Axes of Business Application Integration. Zurich Strategic Thought, Alphacourt Gas Natural, 2002 Curtis, Bill; Hefley, William E.; & Miller, Sally. People Capability Maturity Model Version 2.0 CMU/SEI-2001-MM-01 Pittsburgh, PA: Software Engineering Institute, Carnegie Mellon University, July 2001 European Foundation for Quality Management. The EFQM Excellence Model. Brussels, Belgium, 1999 Flowe, R. M. & Thordahl, J. B. A Correlational Study of the SEI's Capability Maturity Model and Software Development Performance in DoD Contracts (AFIT/GSS/LAR/94D-2). Dayton, OH: Air Force Institute of Technology, Wright Patterson Air Force Base, 1994 Gremba, J. & Myers, C. .The IDEALSM Model: A Practical Guide for Improvement. Bridge, 3 (1997) Hefley, W. E. & Curtis, B. People CMM®-Based Assessment Method Description (CMU/SEI-98-TR-012 ADA354685). Pittsburgh, PA: Software Engineering Institute, Carnegie Mellon University, 1998 Humphrey, W.S. Introduction to the Personal Software ProcessSM. Reading, MA: Addison-Wesley Publishing Company, 1997 Kaplan, R. S. & Norton, D. P. The Balanced Scorecard. Measures That Drive Performance. Harvard Business Review 70, 1 (1992) Paulk, M.C., Curtis, B., Chrissis, M.B., & Weber, C.V. The Capability Maturity Model for Software, Version 1.1. IEEE Software 10, 4 (1993)

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Pfeffer, J. Competitive Advantage Through People. Boston: Harvard Business School Press, 1994 U.S. Dept. of Labor, Office of the American Workplace. High Performance Work Practices and Firm Performance. Washington, D. C.: U. S. Dept. of Labor, 1993

U.S. Office of Personnel Management. A Handbook for Measuring Employee Performance. PMD-13 Rev., January 2001

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