Software economics is an increasingly important topic concerned with improving the value created by investments in the development and use of software. The understanding of the relationships between economics and software development practices is the basis for improving software capability. Software managers have often ignored software economics in the past, because they did not have access to reliable benchmarking data. As a result, many (process) improvement initiatives resulted in satisfying standards/models instead of tangibly improving measured capability. Now that data on thousands of projects is available to the software industry, it is becoming possible to make solid business decisions about software development practices and their results in terms of productivity and quality. Benchmarking is a technique that makes use of external comparisons to better evaluate current performance and identify possible actions for the future. As such, it is an important instrument to drive improvement efforts.
Based on research and case studies, the Software Benchmarking Organization (SBO for short) has developed a benchmarking reference set of Key Performance Indicators (KPIs) that represent current best practice in the software industry. In this set, the following categories are distinguished:
- Project performance
- How predictable is the performance of projects?
- Process efficiency
- How efficient is the development process?
- Product scope
- How large and stable is the scope of the planned effort?
- Product quality
- What is the quality of the resulting outcome/product?
Reference: Dr. Ir. Ton Tinus, Senior Development Director (Philips Healthcare, BU CV):
“The benchmarking study executed in April 2009 was very useful and has brought many new insights. In addition, benchmarking the results with industry values was a useful exercise. The introduced best practice KPI set is considered very powerful and we have adopted the entire set to monitor projects and improvements."
A more detailed presentation about the Software Benchmarking Organization can be found here.