8/24/10©USC-CSSE1 Fall 2010 Marilee Wheaton, USC Course Overview CS 510 Software Management and Economics

8/24/10©USC-CSSE2 Outline Course objective –Help you learn to be a successful software manager –For a career lasting through the 2040’s. Software management learning objectives –What does a successful SW manager need to deal with? What does a successful (software) manager need to do? –Enterprise Success Theorem –Enterprise Success Realization Theorem Overview of VBSE Theory –Value-Based Software Engineering Overview of Course –Programmatics, schedule, academic integrity ICM Overview This Week’s Assignment

8/24/10©USC-CSSE3 What Does A Successful Software Manager Need to Deal With?

8/24/10©USC-CSSE4 What Do SW Managers Need to Deal With? People: customers, users, architects, designers, programmers, testers, lawyers, venture capitalists, suppliers, politicians, … Products: requirements, designs, code, documentation, plans, tools, data, facilities, equipment, … Projects: proposals, presentations, contracts, deliverables, budgets, schedules, milestones, … Resources: time, money, space, communications, skills, … Technology: software, hardware, domain technology, COTS, OSS, … Organizations and Cultures: top management, marketing, sales, development, finance, customer/user organizations, … Changes in all of the above

8/24/10©USC-CSSE5 What Does A Successful Software Manager Need to Do?

8/24/10©USC-CSSE6 Software Management Guidelines Eclectic combinations of advice Management frameworks Maturity models People management theories: X, Y, Z Enterprise Success Theorem: Theory W Enterprise Success Realization Theorem

8/24/10©USC-CSSE7 Sorting out software advice Do it top-down Thorough test planning Prove everything correct Independent test teams Chief Programmer teams Early requirements baseline Build It twice Use disciplined reviews Do it outside-in Programming standards Use walk-throughs Measurable milestones Program Library Configuration management Involve the user End-item acceptance plan Structured Programming Unit development folders Project work authorizations Automated aids Design verification

8/24/10©USC-CSSE8 Koontz-O’Donnell Management Framework PlanningOrganizingDirectingStaffingControlling — Purpose – Contribution to goals – Commitment – Verifiability – Cost-Effectiveness – Precedence — Structure – Premises – WWWWWHHW – Synchronization — Process – Limiting Factor – Flexibility – Navigational change – Performer Participation — Purpose – Contribution to goals — Purpose – Harmony of goals — Purpose – Unity of goals – Cost- effectiveness – Span of Management — Delegation of Authority – Unity of command – Parity of authority Responsibility – Authority level – Absoluteness of responsibility — Division of Work – Form follows function People’s strengths – Functional definition – Separation — Selection – Top talent – Job matching – Career progression – Skills balance – Teamwork — Recruiting – Reward – Openness – Commitment —Retention – Reinforcement – Team building – Phase out – Backup — Purpose – Assurance of goals – Cost-effectiveness – Control responsibility — Motivation – Understanding of goals – Reflection of goals — Communication – Parity of information Responsibility – Receptiveness – Integrity — Leadership – Identification – Empathy – Sustained initiative – Integrity – Team building – Management of time — Structure – Reflection of plans – Organizational suitability – individuality — Process – Standards – Critical-point – Exception – Flexibility – Timeliness – Action

8/24/10©USC-CSSE9 CMMI Process Areas Staged Representation Project Planning Project Monitoring and Control Configuration Management Process & Product Quality Assurance Supplier Agreement Management Measurement and Analysis Requirements Management Organizational Process Focus Organizational Process Definition Organizational Training Integrated Project Management Risk Management Decision Analysis and Resolution Requirements Development Technical Solution Product Integration Verification Validation Quantitative Project Management Organizational Process Performance Causal Analysis and Resolution Organizational Innovation & Deployment Level 2 Managed Level 3 Defined Level 4 Quantitatively Managed Level 5 Optimizing Level 1 Performed Integrated Teaming Organizational Environment for Integration

8/24/10©USC-CSSE10 Theory X and Theory Y* Theory X –People inherently dislike work –They have to be coerced into working –They prefer being told what to do Theory Y –People don’t inherently dislike work –People can exercise self-direction –Commitment to objectives depends on resulting rewards –People can learn to seek responsibility –Work creativity is widely distributed –People’s potential is only partially utilized * D. McGregor, The Human Side of Enterprise, 1960.

8/24/10©USC-CSSE11 Theory Z: Japanese-Style Management People work best toward goals which they have helped establish Once people have bought into goals, you can trust them to perform If people share a common set of values, they can develop workable project goals

8/24/10©USC-CSSE12 Theory W: Enterprise Success Theorem – And informal proof Theorem: Your enterprise will succeed if and only if it makes winners of your success-critical stakeholders Proof of “if”: Everyone that counts is a winner. Nobody significant is left to complain. Proof of “only if”: Nobody wants to lose. Prospective losers will refuse to participate, or will counterattack. The usual result is lose-lose.

8/24/10©USC-CSSE13 Win-lose Generally Becomes Lose-lose Actually, nobody wins in these situations Proposed Solution“Winner”Loser Quick, Cheap, Sloppy Product Developer & Customer User Lots of “bells and whistles” Developer & UserCustomer Driving too hard a bargain Customer & UserDeveloper

8/24/10©USC-CSSE14 Enterprise Success Realization Theorem Theorem: Your enterprise can realize success if and only if 1.You identify and involve all of the success critical stakeholders (SCSHs) –Dependency theory 2.You determine how the SCSHs want to win –Utility theory 3.You help the SCSHs determine and commit to a win-win course of action and solution –Decision theory 4.You adaptively control the course of action to continue to realize a win-win solution –Control theory

8/24/10©USC-CSSE15 VBSE Theory 4+1 Structure

8/24/10©USC-CSSE16 VBSE Component Theories Theory W (Stakeholder win-win) –Enterprise Success Theorem, Win-Win Achievement Theorem Dependency Theory (Product, process, people interdependencies) –Systems architecture/performance theory, costing and scheduling theory; organization theory Utility Theory –Utility functions, bounded rationality, Maslow need hierarchy, multi-attribute utility theory Decision Theory –Statistical decision theory, game theory, negotiation theory, theory of Justice Control Theory –Observability, predictability, controllability, stability theory

8/24/10©USC-CSSE17 Initial VBSE Theory: 4+1 Process – With a great deal of concurrency and backtracking

8/24/10©USC-CSSE18 Outline Course objective –Help you learn to be a successful software manager –For a career lasting through the 2040’s. Software management learning objectives –What does a successful SW manager need to deal with? What does a successful (software) manager need to do? –Enterprise Success Theorem –Enterprise Success Realization Theorem Overview of VBSE Theory –Value-Based Software Engineering Overview of Course –Programmatics, schedule, academic integrity ICM Overview This Week’s Assignment

8/24/10©USC-CSSE19 Comparison of CS 510 and CS 577a COCOMO II Extensions Microeconomics – Decision Theory Agile and Rapid Development People Management 2 Midterms, Final VBSE Framework ICM WinWin Spiral – Risk Management Planning & Control – COCOMO II Business Case Analysis S/W - System Architecting Operational Concept & Rqts. Definition – WinWin System – Prototyping OO Analysis & Design – Rational Rose Team Project (DEN: IV&V) CS 510 CS 577a VBSE Theory, Practice

8/24/10©USC-CSSE20 CS 510 Course Schedule Overview Aug 24 – Sep 28 VBSE, ICM, Agility and Discipline, People Management, COCOMO II Sep 28 Midterm Exam I Oct 5 – Oct 26 Software Microeconomics, Risk and Business Case Analysis Oct 26 Midterm Exam II Nov 2 – Nov 30 COTS Integration, Planning & Control, Maturity Models, Case Studies Dec 7 Final Exam

8/24/10©USC-CSSE21 CS 510 Programmatics - I Basis of grade. Final Exam, 30%; 2 midterms: 20%; Homework exercises: 50%. Texts. Boehm et al., Software Cost Estimation with COCOMO II, Prentice Hall, 2000; Selby, Software Engineering: Barry W. Boehm ’ s Lifetime Contributions to Software Development, Management and Research, Wiley, 2007; Boehm and Turner, Balancing Agility and Discipline, Addison and Wesley, 2004 Instructors. Prof. Marilee Wheaton, SAL 328, (213) , Fax (213) ; Office Hours. Marilee: Tuesday, 5:30-6:30 PM or by appointment. SAL 328. Teaching Assistants. Tom Tan, Vu Nguyen, Qi Li TA Office Hours. Please check it online Web page:

8/24/10©USC-CSSE22 CS 510 Questionnaire and Acknowledgement Please fill out and return. Name: _________________________________________________ Student ID #: ___________________________________________ Dept./Degree Program: __________________________________ Job, Employer: _________________________________________ Software Work Experience (years): _______________________ Phone, fax numbers: ____________________________________ Address: ________________________________________ Acknowledgement: I acknowledge the importance of USC's academic integrity standards (with respect to plagiarism, referencing others' work, etc.), and agree to abide by them. Signature: ______________________________________________

8/24/10©USC-CSSE23 Academic Integrity Acknowledgement Single most-serious offense: Plagiarism –Using other people’s work without crediting them –Homework, exams, class exercises, individual assignments Minor first offense: You lose one grade level –E.g., B+ instead of A- Major first offense or second offense: F for the course

8/24/10©USC-CSSE24 We are Serious About Plagiarism –And experienced in finding it

8/24/10©USC-CSSE25 Outline Course objective –Help you learn to be a successful software manager –For a career lasting through the 2040’s. Software management learning objectives –What does a successful SW manager need to deal with? What does a successful (software) manager need to do? –Enterprise Success Theorem –Enterprise Success Realization Theorem Overview of VBSE Theory –Value-Based Software Engineering Overview of Course –Programmatics, schedule, academic integrity ICM Overview This Week’s Assignment

8/24/10©USC-CSSE26 15 July 2008©USC-CSSE26 The Incremental Commitment Life Cycle Process: Overview Stage I: DefinitionStage II: Development and Operations Anchor Point Milestones Synchronize, stabilize concurrency via FEDs Risk patterns determine life cycle process

8/24/10©USC-CSSE27 Anchor Point Feasibility Evidence Description Evidence provided by developer and validated by independent experts that: If the system is built to the specified architecture, it will –Satisfy the requirements: capability, interfaces, level of service, and evolution –Support the operational concept –Be buildable within the budgets and schedules in the plan –Generate a viable return on investment –Generate satisfactory outcomes for all of the success- critical stakeholders All major risks resolved or covered by risk management plans Serves as basis for stakeholders’ commitment to proceed Can be used to strengthen current schedule- or event-based reviews

8/24/10©USC-CSSE28 Process Model Principles Principles trump diagrams 1.Commitment and accountability - Needed for high assurance systems 2.Success-critical stakeholder satisficing - Needed for multi-owner systems of systems 3.Incremental growth of system definition and stakeholder commitment - Needed for emergent requirements, rapid change 4, 5.Concurrent, iterative system definition and development cycles - Needed for rapid change, rapid OODA loops 6.Risk-based activity levels and anchor point commitment milestones Used by 60-80% of CrossTalk Top-5 projects,

8/24/10©USC-CSSE29 Incremental Commitment in Gambling Total Commitment: Roulette –Put your chips on a number E.g., a value of a key performance parameter –Wait and see if you win or lose Incremental Commitment: Poker, Blackjack –Put some chips in –See your cards, some of others’ cards –Decide whether, how much to commit to proceed

8/24/10©USC-CSSE30 Scalable remotely controlled operations

8/24/10©USC-CSSE31 Total vs. Incremental Commitment – 4:1 RPV Total Commitment –Agent technology demo and PR: Can do 4:1 for $1B –Winning bidder: $800M; PDR in 120 days; 4:1 capability in 40 months –PDR: many outstanding risks, undefined interfaces –$800M, 40 months: “halfway” through integration and test –1:1 IOC after $3B, 80 months Incremental Commitment [number of competing teams] –$25M, 6 mo. to VCR [4]: may beat 1:2 with agent technology, but not 4:1 –$75M, 8 mo. to ACR [3]: agent technology may do 1:1; some risks –$225M, 10 mo. to DCR [2]: validated architecture, high-risk elements –$675M, 18 mo. to IOC [1]: viable 1:1 capability –1:1 IOC after $1B, 42 months

8/24/10©USC-CSSE32 First Week’s Assignments Homework 1 Today: Sign and turn in questionnaire and acknowledgement By Tuesday, August 31, 2010, 12 Noon: Read SMB-0 Case Study (EP-1), ICM Papers (EP-2, EP-3), VBSE Theory (BB 9-5) Identify, turn in bulleted lists of shortfalls with respect to the ICM principles of key stakeholder satisficing, incremental commitment, and evidence-based project reviews

8/24/10©USC-CSSE33 Example Project : Sierra Mountain bikes Based on what would have worked on a similar project Quality leader in specialty area Competitively priced Major problems with order processing –Delivery delays and mistakes –Poor synchronization of order entry, confirmation, fulfillment –Disorganized responses to problem situations –Excess costs; low distributor satisfaction