Real Insights. Real Results. Software Development and Delivery in Competitive Times

1. Real Insights. Real Results.Software Development and Delivery in Competitive Times Steve Robinson Vice President IBM Rational Software

2. Business and product innovation today will require a significant investment in software • For businesses and institutions everywhere,there have never been so many new possibilities • Imagine the amount of software necessary to: • Deliver a green world • Take advantage of information base explosion • Communicate with a trillion devices • Drive on-going product differentiation • To seize new global market opportunities • Leaders everywhere are deploying increasingly intelligent software, systems and products • Accelerating innovation and enabling effective change is highly dependent on our ability to manage effective software delivery

3. What could you doif all objects wereintelligent… …and connected?

4. What could you do with unlimited computing power…for pennies? Could you identifyanother 20%of proven oil reserveswithout drilling one hole? Could you predict the pathof a storm down to the square kilometer?

5. …or with a billion-person workforce? What could you do with a million-person product development lab…

6. Software developmentprocess and disciplinemust accelerate Do we surf or sink?

7. Changing the IT Cost Structure Will Become a Business Imperative “Business expects greater agility from IT. The current approaches to project prioritization, resourcing, agility and governance are not satisfying customer needs. A new approach to IT delivery modelsand sourcing options is required that allows IT organizations to be more responsive to the needs of the business.” – Barbara Gomolski, Gartner, October 14, 2008 “Changing the Cost Structure of IT Will Become a Business Imperative for Most CIOs” Why This Technology Recession Will Be Different “Transformation and innovation will lead recovery. When we come out the other side of this crisis, companies will look different – technology will have been a catalyst in those changes. – George Colony, Forrester Research, October 26, 2008 “Why this tech recession will be different” The Growing Demand for Product Innovation with Profitability “Companies successfully addressing the challenges [of delivering product innovationfrom software] are driving higher profitability. Best-in-class companiesdecreased development time 25% compared to a 5.5% increase for others”. – Michelle Boucher, Aberdeen Group, March, 2009 “Embedded Systems Development” Economic conditions add significant pressure to the reality of software and systems delivery

8. Rational strategy can bring focus in uncertain times • Provides measured, short-term Return on Investment • Enables longer-term management of Return on Assets • Delivers a platform and processes to make those returns come to life • Encourages and informs, rather than dictates • Supports incremental improvement, leading to faster decision making

9. IndividualChallenges TeamChallenges OrganizationalChallenges BusinessChallenges • Lack of standards impacts ability to collaborate, automate and report • Frequent asset updates and complex dependencies • Geographically dispersed teams • Effective cross-organizational visibility and synchronization • Greater need for market experimentation • Blind adherence to process insensitive to potential business trade-offs • Need for agility@scale • More granular service functionality and composite applications • Growing number of assets including custom, outsourced and packaged However, challenges to effective software delivery remain and expand

10. TransformInformation Technology ModernizeEnterprise Assets DifferentiateProducts Business Value Efficiency Control A maturing approach to software and systems delivery based on measurement Unleashexponential gainsin innovation Software investment management aligned with business and operational priorities Predictable governance and asset utilization Global effectivenessand collaboration Productivity through automation Optimizing software “supply chains” Individual Team Organization Business

11. TransformInformation Technology ModernizeEnterprise Assets DifferentiateProducts Business Value Efficiency Control Realized by continuous improvement on business objectives • Improve business flexibility and lower costs / risk • Improve stakeholder satisfaction & output • Accelerate progress • Reduce scrap / rework • Reduce cost of change Software investment management aligned with business and operational priorities • Improve team productivity • Reduce custom training and tooling variants Predictable governance and asset utilization • Reduce human error • Reduce manual tasks • Improve release quality Global effectivenessand collaboration Productivity through automation Optimizing software “supply chains” Individual Team Organization Business

12. Invest to manage risks and optimize measured outcomes Improve Automation ImproveCollaboration ImproveProcess Increase Flexibility& Investment Value Cost to Implement:<5% Very predictable Productivity:5-25%Timeframe = Days Cost to Implement:5%-10%Predictable Productivity:15-35%Timeframe = Weeks Cost to Implement:10%-35% Some culture change Productivity:25-100%Timeframe = Months Cost to Implement:25%-50% Much culture change Productivity:50-200+%Timeframe = Years Business Value ECONOMIC IMPACTS Efficiency Control Individual Team Organization Business Implementation costsare per person per year

13. 1 2 3 4 Pragmatic steps we took to mature our own software delivery Established business and operational objectives Prioritized practices and defined implementation roadmap Accelerated practice adoption with Rational products and programs – “Tools, Not Rules” Reported, analyzed, and regularly acted on our results

14. 1 Established business and operational objectives BusinessObjectives • Improve market share • Achieve profit margin • Reduce time-to-value • Heighten responsiveness and increase linkage to customers • Innovate to differentiate and capture new value • Increase quality • Shorten project development cycle times • Improve schedule predictability OperationalObjectives

15. Initial RationalFocus Area Change and Release Management Change and Release Management • Team Change Management • Formal Change Management • Team Change Management • Formal Change Management Requirements Management Requirements Management Quality Management Quality Management • Shared Vision • Use-Case-Driven Development • Requirements Management • Business Process Sketching • Shared Vision • Use-Case-Driven Development • Requirements Management • Business Process Sketching • Concurrent Testing • Test Management • Independent Testing • Performance Testing • Application Vulnerability Assessment • Concurrent Testing • Test Management • Independent Testing • Performance Testing • Application Vulnerability Assessment Agile Core Agile Core • Iterative Development • Two-Level Project Planning • Whole Team • Continuous Integration • Test-Driven Development • Iterative Development • Two-Level Project Planning • Whole Team • Continuous Integration • Test-Driven Development 2 Governance and Compliance Governance and Compliance Architecture Management Architecture Management • Risk-Value Lifecycle • Practice Authoring and Tailoring • Performance Measurement • Risk-Value Lifecycle • Practice Authoring and Tailoring • Performance Measurement • Evolutionary Architecture • Evolutionary Design • Component Based Software Architecture • Design Driven Implementation • Evolutionary Architecture • Evolutionary Design • Component Based Software Architecture • Design Driven Implementation Prioritized practices and defined implementation roadmap

16. 3 Accelerated practice adoption with Rational products Leveraged Agile Core practices to improve cycle times and predictability • Required adoption of agility@scale • 2,000+ developers, testers, managers • Varying team sizes • Geographically distributed locales • Diverse development contexts • from mature products to Web 2.0 apps • Embraced Rational Team Concert • Since May of 2008: • Growth of 423% to 148 projects • Growth of 410% to 2,810 users

17. Executive and Operational Dashboards Jazz Integration Architecture: Using REST Open Services / ODBC / XML Rational ClearQuest Rational Requirements Composer Rational RequisitePro Rational ClearCase Project Data Headcount & Financials Sales &Pipeline Customer Support Manual Data Rational Team Concert Rational Quality Manager Rational Test Manager RATIONAL THIRD-PARTY Data Sources: Quantitative and Qualitative 4 Reported, analyzed, and regularly acted on our results Aggregated data from multiple sources to provide new insight

18. Leveraging our experiences to help you… Start here! Phase 1 • Establish business and operational objectives Phase 2 • Prioritize practices and define roadmap Phase 3 • Accelerate adoption with tools and services Phase 4 • Report, analyze and act on results Start next incremental improvement

19. IBM Rational Acquires Project & Portfolio Management IBM Rational Acquires IBM Rational Transformation Application Security & Compliance software IBM Rational Acquires Customer Needs & Lifecycle Management for Software Systems IBM Rational Acquires Application Security and Compliance Management IBM Rational Acquires Software Delivery Process Automation & Compliance First Wave Offerings IBM Acquires Team Collaboration and Requirements Definition SOA Lifecycle Management New SOA quality, architecture & asset management solutions Enterprise Modernization System i & z Tools Integrated into Rational Standardization Practitioner Flexibility & Productivity Software Development Platform & Processes Accelerating Global Software Delivery Governing the Business Process of Software Delivery Visibility & Collaboration in Software Delivery Driving Greater Value from Software Investments 2002 2004 2006 2008 2009 Rational Historical Performance(Estimate of four quarter rolling total revenue)

20. Changing Rational to address real needs of development Analyze business opportunity and the impact of changeand effectively manage organizational transformation by better aligning business and development priorities Deliver quality solutions and improve efficiency through real-time team collaboration, automation and reporting and leveraging proven best practices Build consensus through business and development collaboration making good decisions based on real-time and accurate information across all stakeholders

21. Capture and connect the web of informationUnify multiple perspectives to ensure alignment to changing business objectives Capture the current and propose future state with Business Process Diagrams Use Rich-text Documents to capture structured and unstructured information (links, images, emails) Remove ambiguity on business and technical terminology with shared Glossaries Collaborate in real-time using Wiki-like discussions, to quickly achieve sign-off Visualize the user experience with Storyboards Diagram and elaborate Use Cases to frame requirements in the user’s perspective

22. Project Manager Developer / Build Engineer Tester Process Awareness

23. Project Manager Developer / Build Engineer Tester Work Items

24. Project Manager Developer / Build Engineer Tester In Context collaboration

25. Project Manager Developer / Build Engineer Tester Iteration Planning and Execution

26. Project Manager Developer / Build Engineer Tester Team Build

27. Project Manager Developer / Build Engineer Tester Web Client

28. Project Manager Developer / Build Engineer Tester Web Project Dashboard

29. Offerings Web 2.0 Rational ClearQuest RationalAssetManager RationalBuild Forge Powered by Rational RequisitePro Rational ClearCase The road aheadJazz offerings in 2009 and beyond Rational Enterprise Reporting RationalProject Management RationalMethodComposer Rational ClearQuest, Build Forge & RequisitePro RationalClearCase Gain insight based on real-time and historical trend information Manage global projects and resources Dynamic process, enactment and management Realize the strengths of ALM through Jazz integrations Extend collaboration capabilities Rational Integrations • Rational Software Architect • Rational Application Developer • Rational AppScan & Tester portfolio • Rational Enterprise Modernization including System z and IBM i support More dynamic integration leveragingJazz “Open Services for Lifecycle Collaboration” services

30. Other IBM sessions at CEE-SECR 2009 Keynote session: Grady Booch 29 October from 9:30-10:00AM Best Practices in Software Architecture Technical Sessions: 28 October from 3:00-3:30PM • Evolution of Application Lifestyle Management (ALM) Solutions 29 October from 5:30-6:00PM • MCIF – Structured Approach to Improvement of Software Development Process