Homework assignment 5 Business Case - Copy

Homework assignment 5 Business Case - Copy -...

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Homework assignment 5 Business Case Sushant Arora  2505446
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Executive Summary This business case is to move the company from CMM level 3 to level 4 in 2 years  as big contracts are on the way and also it will help us in competing contracts on  U.S. Government.Our main competitors are on level 4 so this will equal the play  ground. Being at level 3 shows that we possess documented,standardized and integrated  management and engineering process and there is stable foundation for Software  Engineering and Management but being at level 4 means that process is measured  and   operates   within   limits   and   it   provides   structure   for   all   elements   of  startegy.So,clearly we are in need of “process improvement program”. The budget for the process group ,responsible to accomplish the task, for this year  will be $ 2.4 million with staff of eight including two part timers and two retirees. Also, when early error detection and correction will be done then cost avoidance will  be $ 1.2 million/year and that will increase quality and customer satisfaction as well. Systematic reuse will avoid cost of around $ 10 M and helps improve quality 10  times and we start gaining profits in 3 years of starting. Use of COTS will do cost avoidance of $ 1 M/year with improved maintenance and  productivity improvement will avoid cost by $ 4M. The   average   gain   that   our   company   was   gaining   during   past   five   years   was  approximately 20% annually as it moved from level 3 to level 4.Thus the ROI  calculated in second year is annual benefit/Investment which is $ 6.2M/$2.4M i.e.  >250%   in   second   year .Here,   cost   avoidance   due   to   systematic   reuse   is   not  included because of timing 
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Business opportunity This transition from level 3 to level 4 will definately be a boon to our company as not  only it will raise the standards and be a mark of improvement and will show how  organised   ,   standardised   we   are   but   also   open   myriad   number   of   business 
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This note was uploaded on 04/12/2010 for the course CIS 635 taught by Professor Mcintyre during the Spring '10 term at Cleary University.

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Homework assignment 5 Business Case - Copy -...

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