Monday, June 27, 2011

Do Product Companies need CMMi certifications?

As a product manager in India, I keep getting questions from my various quarters regarding CMMi certification for software product companies.

"Do software product companies need CMMi certifications?"

The questions are often asked by people whom have worked in software services companies and they have moved to a product company and find it strange that the organisation they are working for does not have CMMi certification, and they want to be the one who will implement CMMi in their new organisation.

The answer to these questions has always been the same: Look from the customer perspective and see if it makes business sense to go for CMMi certification.

Any certification, CMMi including, costs money, time and effort. Investing in CMMi must give adequate returns - in form of increased revenue & increased profits. This means that CMMi processes must help to do one or more of the below:

1. Increase sales of the product.

2. Increase the average selling price of the product.

3. Increase the revenue opportunities for subsequent services/products.

4. Decrease the time/cost to develop the product.

5. Decrease the cost of sales.

Implementing CMMi takes money, so from a business point of view, this investment must be justified. Also one needs to look at the product from customer's point of view:

  • Do customers prefer to buy products from vendors who have CMMi process in developing the product?
  • Do customers pay a premium for the product that was developed by CMMi certified team?

If the answers to the above questions is "NO", then there is no need for CMMi certification.

If the answer is yes, then you need to look at the investments needed, and the returns it gets. The return on investments must be inline with the corporate financial requirements.

Today customers do not care about CMMi certifications while buying a product. CMMi is more applicable to services. Customers look for vendors to be CMMi certified while buying IT services.

By the time I go through these questions, answer to the first question is a resounding NO.

The next question that comes up is:

"We offer services built on top of our products, so do we need CMMi certification?"

The answer to is question is not easy, it depends on the size and scale of the services and level of customer's comfort level with the services being offered.

Are the services built only on the products being sold?

If the services are primarily for software integration or system configuration and the business is built on top of the software products, the there is not much competition, therefore there is competitive reasons to go for CMMi. In such cases there is no need to go for CMMi certifications. However if the service organisation wants to improve its competitive position and the service delivery process, then it is good to go for CMMi certification.

How long and how large is the service engagement?

If the service engagement is long and involves complex SLA and multiple deliveries, then it makes sense to opt fir CMMi certification. In such cases, CMMi certification is beneficial to improve delivery process and reduce dependency on key individuals.

Is there specific requirements in RFP/RFQ that specifically calls for CMMi certified vendor?

Or

Does CMMi certification help in winning the business?

Well in such cases there is no option but to go for CMMi certification, as it is necessary to compete in the market place.

Closing Thoughts

The decision to choose CMMi certification should be based on market conditions and return on investments. CMMi certification carries additional overheads in terms of project delivery and implementation and one must invest in this extra processes and procedures only if it makes business sense. The need to go for CMMi certification must be driven by sales requirements and not by engineering.

10 comments:

Abarshini said...

Wonderful blog & good post.Its really helpful for me, awaiting for more new post. Keep Blogging!









CMMI Consulting in Chennai

Juhi Khan said...

Thank you for making the effort and spreading this information with us. We DQS Certification India Private Limited provides CMMI Services, ISO Certification Services, HIPAA, SSAE16 Audits and IT Trainings and Certifications in India and worldwide. You can inform us for the further posts about CMMI Services and ISO Certification and visit our official website http://dqsindia.com/ for more information about Certification services.

Rehashi ma said...


Hi there, awesome site. I thought the topics you posted on were very interesting
CMMI Consulting India

QUALITY SERVICES said...

Nice post, I bookmark your blog because I found very good information on your blog, Thanks for sharing- more information
http://goo.gl/tGqfRs

George Smith said...

Nice blog and the content posted in the blog seems quite informative to explore about CMMI Services . The blog is very helpful for me. Thanks for sharing such useful post.

Rachel White said...


Hi there! great post. Thanks for sharing some very interesting and informative content it is a big help to me as well, keep it up!!!

CMMI Certification Consultancy

Quality Services said...

nice blog !! thanks for sharing this information. i was looking for iso certification india but i found your blog. this is good and interested to read.

Divya Singh said...

This is really a very interesting blog which are provides the quality information. You are mention some of very important terms which is very helpful to easily understand the concept of ISO Services. I really like the work which is done by admin and so thankful to admin for sharing this useful information with us.
ISO Certification in India

Vinoth Kannan said...

Good blog. Thanks for sharing . I learned something from this .Thanks once again.


CMMI consulting

Anya Sharma said...

There is no doubt that the admin of this blog done very great work in this blog which is very helpful to lots of people. The information is purely understandable and very important for business growth. Thanks for sharing.
ISO Certification in Lucknow