IT Service Management Can Save Big Money

March 31, 2009 · Filed Under IT Estimating · 2 Comments 

These two quotes I saw floating around point out how management of IT services is important, with a significant ROI…

“Process — or the lack of it — is what is really killing IT. The way things are still done in a sloppy fashion is inefficient; it wastes money and trust me there isn’t a CIO out there that can tolerate any wasted money, IT leaders will realize this is a time to mature processes and prove IT can become more efficient in a down economy.”
Glenn O’Donnell, Senior Analyst, Forrester Researc

“Gartner measurements show that the overall results of moving from no adoption of IT Service Management to full adoption can reduce an organization’s Total Cost of Ownership by as much as 48%.” ITIL Survival

Of course to determine ROI viable estimation, planning and control are required.  Cost estimating and trade-offs become key in the implementation of IT service management.


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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Cost Trends Over Centuries

March 30, 2009 · Filed Under Estimating, Thoughts · Comment 

Excellent work by Phillip Pugh (who recently passed away) showing trends over time.

 

 

cost-trends3

 

 

 

 

 

 

 

 

 

 

 

 

—30–


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.



Eight Causes of Project Failures: UK Government IT Projects

March 30, 2009 · Filed Under CEO, Thoughts · Comment 

From the POST report on UK Government IT projects, there are some insightful lessons on why projects fail. Now if we could only get the world to bring those into play early. We could avoid many project failures. Note number 6…. not taking the total ownership cost into account. That is why we stress total ownership costs (which many organizations don’t want to worry about until it is too late).

1. Lack of a clear link between the project and the organisation’s key strategic priorities, including agreed measures of success.

2 Lack of clear senior management and ministerial ownership and leadership.

3. Lack of effective engagement with Stakeholders.

4. Lack of skills and proven approach to project management and risk management.

5. Lack of understanding of and contact with the supply industry at senior levels within the organisation.

6. Evaluation of proposals driven by initial price rather than long-term value for money (especially securing the delivery of business benefits).

7. Too little attention to breaking development and implementation into manageable steps.

8. Inadequate resources and skill to deliver the total delivery portfolio.


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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“Far Out” Estimating the Costs Of Satellites Far Into The Future

March 30, 2009 · Filed Under Hardware Electronics Systems Estimating, Risk, Systems Estimating, Thoughts · Comment 

I had the opportunity to brief part of the space community on the latest release of the SEER Far Out model for cost estimating.   Far Out estimates the costs of satellite systems far out into the future.  Why would anyone want such an estimate, you may ask.  Estimates of systems in the future made today can change planning and approaches for future generations of technology.

This capability is of interest to:

  • Military space asset planners
  • Government agencies
  • Commercial satellite producers
  • Advanced concept designers

I have been excited about this project ever since its research began several years ago.  It needed to deal with technology readiness levels (TRL), that is how available is the technology being used for systems developed in the future.

Technology readiness levels are interesting since, when they are low, estimates are extremely difficult and will, by nature, have a large range.  For example, if you asked Thomas Edison in 1876  how much and how long it would take to develop the light bulb,  he likely would have had no clue  before the basic carbon filament was invented. This was a TRL 1 problem.   He had no good way to know how long it would take him to get the most basic technology to a level that would be adequate for a product.

In 1979, once the carbon filament was developed to TRL 4, Mr. Edison would have had a much easier time providing development and production estimates.  NASA’s technology readiness level scale follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.



Better Products At better Margins 20 to 40% Cost Price Reduction

March 27, 2009 · Filed Under Design for Manufacturing Estimating, Estimating, Estimation Process, General, Hardware Electronics Systems Estimating, Systems Estimating · Comment 

I was so impressed with the presentation by one of our speakers at the recent user conference that I bought a copy of his book.  In his presentation(and also included on our site, galorath.com) he showed how he saved millions of euros in product costs using target costing, value analysis, and viable cost estimating and SEER. 

It is wonderful to see forward thinkers applying SEER to save big costs as well as to estimate costs.  In his presentation he substantiated savings of 20 to 40% cost price reduction (value improvement)  And he does this not be grinding contractors but by working with them to provide substantial cost savings without impinging on their margins.

His book is well worth a read.  The abstract follows:

“Many companies experience price pressure as a result of the global marketplace. The advance of technology creates many opportunities adding more innovative new features. Yet these opportunities also seem to drive up costs. How to end the resulting profit squeeze? Many aim for low labor cost countries as a solution.

Our approach is: Use Target Costing and Value Analysis.

Target costing sets allowable costs, derived from the value as perceived by customers, instead of price as a result of cost. Value analysis shows the way where the value of a product is, or where to reduce the cost. One of the key success factors in this approach is Cost Engineering and Cost Estimation. Another is multi disciplinary teamwork between marketers, developers, operations and suppliers.
The structured approach and open communication help achieve astonishing results, typically in the range of 20 to 40% cost price reduction or value improvement.
This book, or better Manual, describes how to apply and implement these methods in an organization, and how to involve suppliers efficiently and effectively via so called Design-in Workshops.”

 It can be purchased for 69 Euros at www.orenda.nl


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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How Intuit Controls Software Innovation With TSP and Agile

March 24, 2009 · Filed Under Conferences, Software Estimating, Thoughts · 1 Comment 
I heard Scott Cook,  Intuit Chairman and Co Founder speak  on Team Software Process (TSP) and Agile development and how it has impacted both Intuit and other industries.
I was interested in what he called “Customer driven invention.”  He suggested it was misnamed, that Intuit people drive it.  It is really customer inspired invention…  They find an important unsolved customer problem that they can solve well, and have a process for identifying this.

They have been using  TSP for the last 5 years on Quickbooks.  As an example, Quickbooks has a 15 year old codebase and was originally designed for smaller businesses.  But it became the number one accounting software for midmarket businesses as well, generating requirements that were never dreamed of in its original small business design.  The team said, “It is the wrong product for mid market businesses.”  But they were wrong.  They then used this customer driven invention to add in items they would have included initially, had they identified the midmarket as a target initially… For example they reengineered to handle multi-currency.

TSP helped them actually run AHEAD of schedule with less than .6 defects per ksloc.  Normal Quickbooks development  is about 2 defects per ksloc.

Agile

Intuit also uses Agile approaches when “Customer requirements are changing or not known.”  In these situations they apply Agile.  For example TurboTax may have a question that hasn’t been answered.

2 Person team invented the concept called “live community.”  They put into the product itself the ability for customers to both ask and answer the questions.   Team did  agile with 3 week releases. They road tested it in front of customers.  Now on the right hand side of all 20,000 screens are the questions to be asked  and answered. 

Sometimes users made comments as well as answers…    People can also follow threads and add more comments.

 

 


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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Galorath at SEPG, San Jose

March 23, 2009 · Filed Under Conferences · Comment 

I just saw a press release that went out regarding Galorath Incorporated at the Software Engineering Process Group (SEPG) conference in San Jose.  I am heading there today myself.  Here is the press release:

Galorath Incorporated to Showcase SEER® at SEPG North America 2009

Leading project management software company will introduce new set of users to software.

El Segundo, CA (PRWEB) March 23, 2009 — Galorath Incorporated, the producer of the SEER project estimating software, will exhibit at the upcoming SEPG North America 2009 Conference, March 23-26 in San Jose, CA. The 2009 SEPG North America Conference is hosted by Carnegie Mellon Software Engineering Institute (SEI). SEPG North America is one of the premier conferences for software and systems professionals in government, industry, and academia. SEPG Conferences provide a venue for knowledge sharing, learning, and networking focused on performance improvement through enhanced process capability.

Galorath will be exhibiting at booth #200 and will showcase its SEER project estimation software, a suite of predictive modeling solutions for software cost estimation and estimating IT projects.

SEER for Software (SEER-SEM) is a powerful decision-support model for estimating software development and maintenance cost, labor, staffing, schedule, reliability, and risk as a function of size, technology, and any project management constraints. The SEER for Software estimation and analysis suite of applications provides an integrated solution that supports all phases of the software project life cycle. SEER for Software is effective for all types of software projects, from commercial IT business applications to real-time embedded aerospace systems. SEER for Software assists users in making vital decisions about the development and maintenance of software products to ensure that project plans are realistic, objective and defendable.

SEER for IT (SEER-IT), estimating software for IT projects, was designed for IT professionals, enabling organizations to develop an early and accurate assessment of project costs, schedules, and risks as well as ongoing support, helping to maximize productivity and output with fixed or declining budgets. SEER for IT has a collection of IT estimation elements (process models) which can be used to define the work required as well as patterns for typical organizational approaches. Users can create custom Knowledge Bases and perform analyses with metrics derived from company project histories and task labor standards.

About Galorath Incorporated

For more than two decades Galorath Incorporated has developed solutions to help government and commercial organizations plan and manage complex software, hardware, electronics and manufacturing projects. Leveraging sophisticated modeling technology and project-applicable knowledge bases, SEER solutions enable engineers, project managers, cost analysts and IT professionals worldwide to simulate and analyze alternative project scenarios, develop and optimize detailed project plans and ensure that projects stay on track and meet objectives for functionality, cost, effort, duration and quality. Combined with extensive consulting and support services, SEER by Galorath is the most comprehensive, intuitive project estimation and management solution in the industry. Please visit www.galorath.com for additional information.


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.



Marvelous User Conference: Estimating United at Manchester United

March 20, 2009 · Filed Under Conferences · Comment 

We had a marvelous users conference at the Manchester United Stadium in the UK. Users provided insights in application of SEER to cost estimating, value engineering, supply chain management, software estimating, target costing, function points, COSMIC function points, and much more.

Conference presentations will be posted on galorath.com in a few days.

The conference had multiple tracks so I missed many of the talks.  But of those I heard i especially liked the talk on how using SEER for value engineerin and cost estimating saved MILLIONS of euros bydesigning for cost, the talk covering how a consortium of European countries is using SEER to make project management decisions and the talk describing how a major university used SEER to determine the best redesign of an aircraft.

The real highlight, however, was running out to the pitch at the Manchester United stadium.  We ran from the players locker room thru the tunnel they use while a recording of the crowd roaring approval played.

I dont know how our Los Angeles users conference in October can top that.


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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Some of The Web’s Cost Estimating Handbooks

March 20, 2009 · Filed Under Estimating · Comment 

NASA’s Parametric Cost Estimating Handbook Click here

ISPA Parametric Cost Handbook Click Here

GAO  Cost Estimation Guidebook Click Here

SSCAG Cost Guidebook (Not on Web)

OSD Parametric Software Estimating Guidebook (Not on Web… Available From Galorath)

Air Force Risk Guidebook (Not onWeb)

Joint Industry / Government Parametric Estimating Parametric Estimating Guidebook (Sponsored by DoD)  Not on Web

 


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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SEER Avoids Budgeting Surprises For Major European Organization

March 18, 2009 · Filed Under IT Estimating, Software Estimating · Comment 

I am at Estimating United at Manchester United SEER users conference in the UK.

Much information flowing around.  One item that struck me today is the comment about a MAJOR company and their success before they started using SEER.

They said before SEER 90% of their projects were on budget.  The only problem is they had to increase their budget by 40 million euros to achieve that.

Now they actually understand what their projects should cost up-front and can budget appropriately the first time.

They do include management (risk) reserves:  but these things are done proactively rather than out of panic later.

Avoiding surprises is a great service SEER users provide to their stake holders.


Thank you for reading “Dan on Estimating”, if you would like more information about Galorath’s estimation models, please visit our contact page or call us at +1 310 414-3222.

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