An industrial taxonomy extended to the process industries

Dec. 4, 2013

Allows assessment of capabilities, including those of your suppliers

If you’ve ever spent time in any product-design, engineering, production or shipping departments, you realize there is an unremarked commonality to the way these kinds of work get done that extends across companies.

For example, one reason companies in emerging China might implement an enterprise-resource planning (ERP) system is to enforce more globally accepted accounting practices.

At the same time, every company has its unique customizations and quirks, some necessary and some arbitrary. The problem is, how do you tell which is which? Many business processes, for example, include “evolutionary dead-ends,” once-necessary steps that no longer serve a relevant purpose, yet persist due to systemic entropy or resistance to change. So many employees come to love their work routines.

The Capability Maturity Model Integration (CMMI) model was developed at Carnegie Mellon’s Software Engineering Institute (SEI) through collaboration of government, industry, and academia to help the Department of Defense and contractors like Raytheon, Northrup Grumman, Lockheed Martin, and Boeing improve their software engineering capabilities. It is said many organizations require CMMI adoption as a pre-requisite for bidding on contracts.

The CMMI Institute, established by Carnegie Mellon University, is the home of the CMMI model for development, services, and acquisition; and the People Capability Maturity Model for high-performance, high-maturity cultures.

The Institute announced recently that it will extend the CMMI model to make it relevant for businesses of every size in every industry, while continuing its work in software and systems development. In addition, it will introduce in early 2014 an on-line self-assessment tool and new professional credentials for practitioners.

“The model is already used wherever products are being introduced and not just for software or systems. It is used extensively in the provision of IT services and in the assessment of supplier capabilities in the automotive industry,” says CMMI Institute CEO Kirk Botula.

Using companies include Samsung, Accenture, Proctor & Gamble, and Siemens, among others.

“The model’s success is based on its being agnostic,” Botula says. “It asks as to capabilities without prescribing how something be done or imposing formal written requirements. Rather it assigns levels of maturity.”

Management consultancy firm KPMG has had a decade-long partnership with CMU. “We help use the CMMI Institute product suite—frameworks, training, certifications, and appraisal methods—to achieve organizational goals by enhancing processes,” says KK Raman, a partner with KPMG India.

CMMI provides a framework of practices “that can help organizations identify and address key challenges to improve performance and the bottom line. We all know work is not the way it is supposed to be—CMMI helps make it better,” says Botula.

The CMMI product suite covers product development, service delivery, procurement, and staff management. “Services” is for the “flow side of things,” says Botula.

The online tool, by asking a brief set of questions, allows users to gain insights and an analysis of an organization’s strengths and weaknesses as well as insights that lead to improving capabilities.

Certifications will help individuals translate their experience with CMMI into professional development opportunities and provide confirmation of an individual’s knowledge of basic and advanced concepts in CMMI to current and prospective employers

For process industries, says Botula, the model will prove relevant for those either interested in assessing suppliers or those looking for a comprehensive understanding of their own capabilities. “I used it as head of a software company to reduce customer-facing errors by more than 70%.”

At the end of the day, it’s really about a taxonomy that leads to a model that can be compared against reality. And that’s something we all do every day.

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