Technology Business Management

is a trending approach to help bridge the gap between IT functions and the C-suite.

But TBM is missing an important component.

Consistent Metric of software Size

The key to valid conversations about software governance is adoption of a consistent metric for size.

Technology leadership has done a poor job of providing executives and boards with meaningful concepts and metrics for achievement of business value and risk management through IT.

Sizing software in COSMIC Function Points helps all aspects of software management.
Software Governance starts with knowing the Size

Technology leadership has done a poor job of providing executives and boards with meaningful metrics for progress, work and achievement of business value and risk management through IT.

Finance, technology and business need a common language for spend and value on IT.  The common language needs to be readily understood by all AND it needs to cover cost, value, productivity and quality.

Size matters. The size of a software project or undertaking is measurable.  Standardised functional software sizing in CFP is a very effective ingredient for helping the c-suite work with IT to effectively manage IT investment.

Standard Software Sizing

Large IT projects are far more prone to failure than small ones, first we must agree how to size them.  CFP stands for COSMIC Function Point, a standardised means of measuring software size.  CFP is a measure of user-recognisable functionality, irrespective of the technology used to achieve it.  The COSMIC sizing methodology is free to use by anyone, see: https://cosmic-sizing.org

Learn more about TBM

The C-Suite Needs Better Ways to Manage Technology
Common C-Suite Language for IT investment
  • Obtain insights into technology spend and value
  • Improve technology decisions
  • Improve application portfolio management
  • Align tech spend to general ledger
  • Benchmark technology investments
  • Improve vendor management
  • Identify and reduce waste

CFP is an easy-to-understand, valid, indicator of size that allows sound decision-making without technical jargon.  By adopting CFP as the core metric and the common language for discussing IT investments, organisations can help the c-suite work with IT to improve decision-making of technology investments.  Here are examples of how it can be used:

Application Portfolio Management

Knowing the absolute size (in CFP) of the applications in an IT portfolio is a solid starting place for IT leaders and their peers to make better decisions about the technology investments.   This awareness of functional size can include planning change, assessing total cost of ownership and even benchmarking IT spend and value.    Some organisations may have millions of CFP in core operational systems, others in the same industry may have just a few hundred thousand.  Knowing the cost of maintenance (per CFP) of each application can help drive sound decision-making about the lifecycle of any application (replace, maintain, rebuild).

  • size: CFP
  • value: benefits per CFP from an application

Capability Delivery

Rapid delivery of new software capabilities can be the critical differentiation of winners and losers in a business space.  One case use CFP/month as a basis for rate of delivery, even as a measure of rate of innovation.  Futhermore, this can be supplemented by the quality metric of defects discovered (in production) per CFP.  A low rate indicating high quality work.

  • productivity: CFP/month
  • quality: defects/CFP found in production

Vendor Management

Are you getting fair value from your IT supplier?  How do you measure this.  We advocate that cost per CFP (at a given quality) is an excellent measure.  This is a simple metric that is hard to game and helps managers assess vendor’s work.

  • cost: $ per CFP
  • productivity: CFP per month
  • quality: defects per CFP found in production, or pre-production

Benchmarking

With just a few pieces of knowledge, IT organisations can establish internal benchmarks for their work, they can identify high productive teams to promote good practice internally, equally they can identify low productivity teams and respond with suitable and measurable actions to increase effectiveness of teams.   Armed with size of a project (in CFP), effort to deliver that project (eg. total staff days) and duration (e.g. in months), one can derive a productivity index.

  • cost – new capabilities : cost per CFP of new functionality
  • cost – maintenance: cost per CFP of maintained software
  • productivity: CFP per month
  • quality: Defects per CFP found in production (aligns to defect removal efficiency)
  • technical debt quantification: in CFP

Existential Safety

Organisation’s survival nowadays depends on responsible IT management.  Failure to address existential risks such as care of customer data, cyber security and responsible use of AI have all become board-level concerns (even though many boards are ill-equipped to understand ways to assess).  The use of CFP as baseline for size of software can help boards assess the “per-CFP” commitment to cybersecurity and “per-CFP” attention to ethical use of AI.  Examples of questions that boards can as are: “how many CFP need to be changed/maintained in each application in our portfolio for us to remain reasonably secure from a cyber security perspective?”

  • AI to manage: in CFP
  • AI benefits: value per CFP
  • security enhancements needed: in CFP
  • technical debt quantification: in CFP

If you have followed the ideas above and can grasp the concept of how to use CFP as size measurement for effective IT decision-making, then you are well ahead of the majority in being able to contribute to sound IT decision making.

The majority of IT spends focuses on software to manipulate data, and yet IT organisations have failed to embrace a universal metric for this in terms that non-technical leaders can understand.  An excellent metric exists and yet is poorly adopted because it brings transparency which many find uncomfortable.  Nonetheless CFO’s and CEO’s should demand this.

Automated software sizing

Automated sizing with ScopeMaster can accelerate the adoption of CFP as a standard sizing metric and consequently all the benefits shown.

Value of adopting CFP

When IT leaders track portfolio size, maintenance, change and progress using CFP as the core metric, they can establish KPIs that will work both up and down the organisation.  They can establish a common language from which IT contribution in terms of cost and value can be assessed and understood by all.

TBM without CFP

Of course many IT organisations can be successful without using CFP as a core metric.  But how successful are they? do they even know how they fare against their industry peers?   Could they be even more successful?

Technology Business Management and CFP – destined to unite?

An observation by Colin Hammond:  “Apptio is the software suite of tools that helps businesses do TBM.  Apptio is also the leading tool vendor in this space and may be about to be bought by IBM for several billion dollars.  Back in 1974, an IBM employee, Allan Albrecht invented standardised functional sizing, a concept designed to help with technology management decades before the TBM label was created.  Albrecht’s original idea has now evolved to the COSMIC Function Point ISO standard.  This raises many questions, including: I wonder if IBM will embed COSMIC sizing into the Apptio tooling? “