Organization Maturity

The extent to which a business enterprise is able to exploit IT capabilities to achieve its business objectives is determined by the maturity of its IT organization. ITILv3 provides a set of good practices in order to build IT capabilities so that it is able to deliver what IT organization’s businesses and/or customers are looking for. IT organizational maturity ranges from just being a technology shop, i.e., Level 1, to become a value-chain value-add partner, i.e., Level 5. In this blog, we will try to gain better insights into what these levels actually represent. This discussion will help us with future topics as well.
Here is my perspective on different levels of organizational maturity.
Level 1 – Technology
IT organizations at maturity level 1 demonstrate the following characteristics:

• Technology focused and technology aligned.
• Lack of appreciation on which technology components enable which business services.
• IT investments are primarily made based on technological aspirations rather than business enablement and return on investments.
• Technology domains are managed in technology silos. For example, problems are prioritized and resolved based on technology focus not because of the potential impact of these problems on business/customer priorities.
• IT organizations plan and deliver their services largely in a vacuum without a comprehensive appreciation of the business needs.
• IT organizations largely find themselves in ‘reactive’ mode of operating.

Level 2 – Products / Services
IT organizations at maturity level 2 exhibit the following characteristics:

• IT organizations understand the products/services that are created/delivered by their technology components.
• There is a better understanding of which technology components deliver what services.
• Organizations are still largely technology-driven because of lack of business and customer needs.

Level 3 – Customers
At maturity level 3, IT organizations are able to clearly understand their customers and what they actually need. At this level of maturity, IT organizations are able to identify the gaps between the products and/or services that they produce and the products and/or services that customers actually need. Based on this, IT organizations are able to improve/define services such that the actual customer/business needs are met.
Level 4 – Business
With the concrete understanding of 1) technology capabilities, 2) products and/or services produced, and 3) needs of the customers and/or businesses, IT organizations are able to run IT as a business at maturity level 4. Some of the characteristics are as follows:

• IT organizations clearly understand the market (customers and/or businesses) that they are trying to service.
• IT organizations understand its distinctive capabilities and in what services they are able to provide differentiating services at competitive prices.
• Customers/businesses have control over the IT-related costs and what they want from IT and appreciate the value delivered by IT.
• IT organization is no longer a cost-center.

Level 5 –  Value Chain
IT organizations at maturity level 5 clearly understand the value chain, i.e., the way in which IT services enable business processes and ultimately create value for the end-customers (customers of your customers and/or businesses). These IT organizations are able to clearly relate their IT services to business processes and business products/services. At this level, IT organizations actually become value-add partners.
To learn more about these maturity levels and other related aspects, check out Learning Tree’s course, Achieving ITIL® Foundation Certification, and refer to my book ITIL Service Management: Implementation and Operation.

CMMI

Capability Maturity Model Integration (CMMI) is a process improvement training and certification program and service administered and marketed by Carnegie Mellon University and required by many DOD and Government programs for government contracts, especially software development. Carnegie Mellon University claims CMMI can be used to guide process improvement across a project, division, or an entire organization. Under the CMMI methodology, processes are rated according to their maturity levels, which are defined as: Initial, Repeatable, Defined, Quantitatively Managed, Optimizing. Currently supported is CMMI Version 1.3. CMMI is registered in the U.S. Patent and Trademark Office by Carnegie Mellon University.

CMMI currently addresses three areas of interest:

1. Product and service development — CMMI for Development (CMMI-DEV),
2. Service establishment, management, — CMMI for Services (CMMI-SVC), and
3. Product and service acquisition — CMMI for Acquisition (CMMI-ACQ).

CMMI was developed by a group of experts from industry, government, and the Software Engineering Institute (SEI) at Carnegie Mellon University. CMMI models provide guidance for developing or improving processes that meet the business goals of an organization. A CMMI model may also be used as a framework for appraising the process maturity of the organization.^[1] By January of 2013, the entire CMMI product suite was transferred from the SEI to the CMMI Institute, a newly created organization at Carnegie Mellon.
CMMI originated in software engineering but has been highly generalised over the years to embrace other areas of interest, such as the development of hardware products, the delivery of all kinds of services, and the acquisition of products and services. The word "software" does not appear in definitions of CMMI. This generalization of improvement concepts makes CMMI extremely abstract. It is not as specific to software engineering as its predecessor, the Software CMM

ISO/IEC 20000

ISO/IEC 20000 is a service management system (SMS) standard. It specifies requirements for the service provider to plan, establish, implement, operate, monitor, review, maintain and improve an SMS. The requirements include the design, transition, delivery and improvement of services to fulfil agreed service requirements.
ISO/IEC 20000-1:2011 can be used by:

• an organization seeking services from service providers and requiring assurance that their service requirements will be fulfilled;
• an organization that requires a consistent approach by all its service providers, including those in a supply chain;
• a service provider that intends to demonstrate its capability for the design, transition, delivery and improvement of services that fulfil service requirements;
• a service provider to monitor, measure and review its service management processes and services;
• a service provider to improve the design, transition, delivery and improvement of services through the effective implementation and operation of the SMS;
• an assessor or auditor as the criteria for a conformity assessment of a service provider's SMS to the requirements in ISO/IEC 20000-1:2011.