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| The Quality Tigers at work |
Dr. Horst Walther
Industry: Information Technology (Software for Public Transport)
Line function: IT (Head of Professional Services)
Topic: Restructuring, Turnaround, Kanban, Scrum
Revenue: €10 million
Employees: 120
The Task
A key manager responsible for a software company's flagship product had resigned. This move came unexpectedly, as the highly anticipated new version of the flagship software was about to be released.
There had been no shortage of subtle warning signs. Several internal and external indicators pointed to risks in the technology, functionality, and market readiness of this next-generation product, eagerly awaited by the customer base. Top management apparently hadn't paid the necessary attention to these warning signals.
Immediate action was now required to ensure the release could still proceed as planned. On the other hand, filling the vacant position in a highly transparent market was a prudent move that had to be carried out with the necessary care and caution, and without undue haste.
An experienced interim manager was needed who could quickly take the reins and keep the business running smoothly. While work continued as planned, he was to find, select, and train his successor.
Solution
A three-stage approach had already been agreed upon in advance:
- Diagnosis – Over a period of six weeks, the future interim manager took on an observer role, participated in all key events, conducted interviews, and studied technical documents.
- Immediate Measures – Following an approach that can be aptly abbreviated as CCC (Cash, Cost & Customers), the necessary budget had to be secured, identifiable cost-saving potential had to be utilized, and renewed confidence had to be conveyed to the uncertain customer base. The focus then shifted inward, to the root causes that had ultimately led to this difficult situation.
- Revitalization - Agilization, Metric, Quality Management,
Diagnosis
To narrow down the problem area, identify and assess existing vulnerabilities, and ultimately estimate the scope of necessary measures, the following analytical steps were initiated:
- Estimation of the system size, expressed in lines of code (LoC) and function points (fp) of SAP ABAP code by applying a Backfiring methodology.
- Architecture and design validation using a selected third-party measurement tool.
- Application of a standard defect model, especially to determine the expected number of undiscovered defects.
- Management, reclassification, and prioritization of defects in a defect database based on customer feedback plus expert assessment.
It quickly became clear that, despite the best intentions of launching a particularly high-performing product, a code monster burdened with a great deal of technical debt had been created. Its maintainability limitations were now becoming apparent. At the same time, the next version was due for release. In the meantime, existing customers waited impatiently for a long list of known bugs to be fixed.
The feeling among the employees that they had lost control of the process was confirmed by the quantitative findings. In their distress, they resorted to mutual blame. The working atmosphere suffered considerably as a result.
It had thus become clear that the interim management phase would not simply be a temporary solution to a personnel vacancy. The interim manager therefore had to deliver a convincing turnaround strategy. He also had to possess the charisma to bring the team and management on board for what was expected to be a difficult journey.
Immediate measures
And this is where we started, with the development teams. In an all-hands meeting, the critical situation was officially presented to the staff for the first time. After initial strong emotions, it eventually became clear to everyone involved that the goal of an effective turnaround could only be achieved together.
The stated guiding principle of "quality before deadline" was ultimately received with relief, and the release of the new version was halted until sufficient system stability was achieved.
Since a lack of or dysfunctional inter-team communication had been identified as a major obstacle, all developers now gathered daily at the start of their workday in front of the Kanban board to coordinate testing and bug fixing.
Comprehensive communication was also the key factor in winning over impatient customers to the new "no more false promises" strategy. —and in return, to obtain their approval for the one-time extended delivery deadline.
The product under development was functionally quite attractive, promised to fulfil many long-held wishes of the transport companies, and, thanks to its document-oriented workflow concept, was a favourite of the external auditors. The understanding shown to us, albeit reluctantly, was only a step in the right direction, a trust that we first had to earn back.
Even though the “customer is king,” the next step was to be completely honest with the shareholders represented on the advisory board and win them over to the new approach. They ultimately accept the emergency action plan – also due to a lack of realistic alternatives.
The full focus on the "Quality First Paradigm" in all phases of software development, supplemented by an emphasis on a "Clean Code" approach and random checks of its compliance by newly appointed "Quality Tigers," and the practical implementation of this approach.
Agile management methods – Scrum for implementation projects, Kanban for maintenance activities – rounded off the necessary immediate measures.
Revitalization
Even though the sprint for the upcoming delivery of the "next-generation software" yielded initial successes, it had become clear that we were not yet adequately prepared for the marathon ahead. The changing market, with its new and dynamic competitors, new requirements, and increased price sensitivity among customer groups, demanded increased productivity and, at the same time, greater cost efficiency.
Given the increased demands on the one hand and the distressingly high level of technical debt on the other, the medium-term measure of exploring the possibility of outsourcing particularly resource-intensive tasks to a lower-cost country via "nearshoring" was undertaken.
In order to outsource these tasks, system documentation and training materials first had to be updated and translated into English. The nearshoring teams under consideration were often far ahead of us in the application of agile development methods. A training program for internal staff therefore had to be set up immediately.
The complex transformation of the entire development department, the heart of the company, had to be justified by ambitious growth targets in a market that was fortunately not yet saturated.
This meant, among other things, supporting various national architectural standards for public transport. Internally, product and project business had to be separated and professionalized.
The ruthlessly realistic investment forecast, presented as an essential part of a long-term business plan, initially raised eyebrows among the shareholders but was ultimately accepted.
Part of this included a proposed new management structure for the "Professional Services" division, the hiring of a product manager and a service delivery manager, and finally, the handover to the new management.
Result
On the one hand, the New transparency helped to open the eyes of management and the board of directors to the seriousness of the situation and the extent of the "technical debt" accumulated over the years.
On the other hand, the revitalization program developed a strong persuasive power. The presented vision was supported by solid numerical calculations. While the presented business plan showed high investments to pay off the technical debt accumulated over the past years, it promised a positive cash flow after approximately two years.
Meanwhile, the ad-hoc activities showed initial positive results and strengthened confidence in the feasibility of this project. With renewed hope and the first positive signals from the market, the handover to the new management gave the company new momentum and was generally perceived as a new beginning.
Dr. Horst Walther
SiG Software Integration GmbH
Große Bleichen 1-3
20354 Hamburg
horst.walther@si-g.com
https//www.si-g.com
+49 171 214 55 02
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