A Software Engineering Lifecycle Standard for Very
Small Enterprises
Claude Y. Laporte
1
, Simon Alexandre
2
, and Rory V. O'Connor
3
1
École de technologie supérieure, Montréal, Canada
2
Centre d’Excellence en Technologies de l’Information et de la Communication, Charleroi,
Belgium
3
School of Computing, Dublin City University, Dublin, Ireland
Claude.Y.Laporte@etsmtl.ca, simon.alexandre@cetic.be, roconnor@computing.dcu.ie
Abstract. Industry recognizes that very small enterprises (VSE), that develop
parts having software components, are very important to the economy. These
parts are often integrated in products of larger enterprises. Failure to deliver on
time, within budget a quality product threatens the competitiveness of both
organizations. One way to mitigate these risks is by having all suppliers of a
product chain to put in place recognized engineering practices. Many
international standards and models like ISO/IEC12207 or CMMI have been
developed to capture proven engineering practices. However, these standards
were not designed for very small development organizations, those with less
than 25 employees, and are consequently difficult to apply in such settings. An
ISO/IEC JTC1/SC7
1
Working Group has been established to address these
difficulties by producing a tailored software engineering standard to VSE.
Keywords: ISO, Lifecycles, Very Small Enterprises, Standards
1 Introduction
Today the ability of organizations to compete, adapt, and survive depend increasingly
on software. By 2010, it is estimated that cellular phone will contain 20 million lines
of code, an automobile manufacturer estimated that its cars will have up to 100
million lines of code [1]. These manufacturers depend increasingly on the
components produced by their suppliers. A manufacturing chain, of large mass market
products, often has a pyramidal structure. The pyramid is composed, of a layer of
dozens of main suppliers which are supplied by a layer of hundreds of smaller
suppliers. These small suppliers layer have thousands of very small suppliers. As an
example, a large mass product manufacturer integrated in one of its product a part,
with an unknown software error, produced by one of its 6000 producers[2]. The
1
ISO/IEC JTC 1/SC7 stands for the International Organization for Standardization/
International Electrotechnical Commission Joint Technical Committee 1/Sub Committee 7,
which is in charge of the development and maintenance of software and systems engineering
standards
defective part resulted in a multi-million dollar loss by the manufacturer. The need for
international software engineering standards is clear.
There is evidence that the majority of small software organizations are not
adopting existing standards as they perceive them as being orientated towards large
organizations. Studies have shown that small firms’ negative perceptions of process
model standards are primarily driven by negative views of cost, documentation and
bureaucracy. In addition, it has been reported that VSEs find it difficult to relate
ISO/IEC 12207 to their business needs and to justify the application of the
international standards in their operations. Most VSEs cannot afford the resources for,
or see a net benefit in, establishing software processes as defined by current standards
(e.g. ISO/IEC 12207) and maturity models such as the Capability Maturity Model
Integration CMMI) developed by the Software Engineering Institute [3].
Accordingly there is a need to help these organizations understand and use the
concepts, processes and practices proposed in the ISO/IEC JTC1/SC7’s international
software engineering standards. This paper presents a new project intended to
facilitate access to, and utilization of, ISO/IEC JTC1/SC7 software engineering
standards in very small enterprises.
This paper is divided into six sections. Section 2 presents the concept of a VSE and
describes the characteristics that distinguish a VSE from other organizations. Section
3 presents a historical perspective on the events that led to an ISO/IEC JTC1 SC7
project proposal for VSEs and section 4 presents the results of a survey that was
developed to question VSEs about their utilization of ISO/SC7 standards. Section 5
explains the approach being take by the VSE working group and finally section 6
presents concluding remarks and discusses future actions.
2 Very Small Enterprises
The definition of “Small” and “Very Small” Enterprises is challengingly ambiguous,
as there is no commonly accepted definition of the terms. For example, the
participants of the 1995 CMM tailoring workshop [4] could not even agree on what
“small” really meant. Subsequently in 1998 SEPG conference panel on the CMM and
small projects [5], small was defined as “3-4 months in duration with 5 or fewer
staff”. Johnson and Brodman [6] define a small organization as “fewer than 50
software developers and a small project as fewer than 20 software developers”.
Another definition for VSE introduced by Laporte et al [7] as “any IT services,
organizations and projects with between 1 and 25 employees”.
To take a legalistic perspective the European Commission [8] defines three levels
of small to medium-sized enterprise (SME) as being: Small to medium - “employ
fewer than 250 persons and which have an annual turnover not exceeding 50 million
Euro, and/or an annual balance sheet total not exceeding 43 million Euro”; Small -
“which employ fewer than 50 persons, and whose annual turnover or annual balance
sheet total does not exceed 10 million Euro” and Micro - “which employ fewer than
10 persons and whose annual turnover”.
To better understand the dichotomy between the definitions above it is necessary to
examine the size of software companies operating in the market today. In Europe, for
instance, 85% of the Information Technology (IT) sector's companies have 1 to 10
employees
2
. In the context of indigenous Irish software firms 1.9% (10 companies),
out of a total of 630 employed more than 100 people whilst 61% of the total
employed 10 or fewer, with the average size of indigenous Irish software firms being
about 16 employees [9]. In Canada, the Montreal area was surveyed, it was found that
78% of software development enterprises have less than 25 employees and 50% have
fewer than 10 employees [10]. In Brazil, small IT companies represent about 70% of
the total number of companies [11].
Therefore based on the above discussions, for the purposes of this paper we are
adopting the definition for VSE introduced in [7] as “any IT services, organizations
and projects with between 1 and 25 employees”.
2.1 Characteristics of a VSE
The unique characteristics of small entrepreneurial businesses as well as the
uniqueness of their situations of necessity make their style of business different [12].
Some of the unique differences between very small and large businesses behavior are
given in Table 1.
Table 1. Characteristic differences between large firms and small firms.
Characteristic Small firm Large firm
Planning orientation Unstructured/operational Structured/strategic
Flexibility High Structured/strategic
Risk orientation High Medium
Managerial process Informal Low
Learning and knowledge
absorption capacity
Limited High
Impact of negative market
effects
More profound More manageable
Competitive advantage Human capital centered Organizational capital centered
Software VSEs are subject to a number of distinctive and intrinsic characteristics
that make them different from their larger counterparts, therefore affecting the
contents, the nature and the extent of the activities. We classify VSE characteristics
according to four main categories: Finance, Customer, Internal Business Processes
and Learning and Growth:
VSEs are economically vulnerable as they are driven by cash-flow and depend on
project profits, so they need to perform the projects within the budget. They tend to
have low budgets which have many impacts, such as: Lack of funds to perform
corrective post delivery maintenance; Few resources allocated for training; Little or
no budget to perform quality assurance activities; No budget for software reuse
processes; Low budget to respond to risks; and Limited budget to perform Process
Improvement and /or obtain a certification/assessment.
2
http://www.esi.es/en/main/iitmark.html
Typically the VSEs product has a single customer, where the customer is in charge
of the management of the system; the software integration, installation and operation.
It is normal practice for the customer to not define quantitative quality requirements
and for customer satisfaction depends on the fulfillment of specific requirements that
may change during the project. A close relationship between all involved project
members including the customer shows that software development in small and very
small companies is strongly human oriented and communication between them is
important. For example, in contrast to small companies, very small companies often
do not have regularly project meetings [13].
The internal business process of VSEs are usually focused on developing custom
software systems, where the software product is elaborated progressively and which
typically does not have strong relationship with other projects. Typically most
management processes (such as human resource and infrastructure management) are
performed through informal mechanisms, with the majority of communication,
decision making and problem resolution being performed face to face.
The learning and growth characteristics of VSE are typified by a lack of
knowledge (or acceptance) of software process assessment and improvement and a
lack of human resources to engage in standardization. It is usual for a negative
perception of standards as being made by large enterprises, for large enterprises [9].
3 History of the ISO/IEC Working Group for VSEs
The mandate of ISO/IEC JTC1/SC7 is the standardization of processes, supporting
tools and supporting technologies for the engineering of software products and
systems. A description of SC7 and of the development of ISO/IEC JTC1/SC7
standards is presented in [14]. In this section, a brief history of the events leading to
the creation of a new ISO/IEC JTC1/SC7 Working Group (WG) is presented. A
detailed description of its history is available in [3].
At the May 2004 SC7 Plenary meeting in Brisbane, Canada raised the issue of
small enterprises requiring standards adapted to their size and maturity level. The
current software engineering standards target (or are perceived as targeting) large
organizations. A meeting of interested parties was organized and a consensus was
reached on general objectives for a future working group:
• To make the current software engineering standards more accessible to VSEs;
• To provide documentation requiring minimal tailoring and adaptation effort;
• To provide harmonized documentation integrating available standards:
• Process standards
• Work products and deliverables
• Assessment and quality
• Modeling and tools
• To align profiles, if desirable, with the notions of maturity levels presented in
ISO/IEC 15504.
In March 2005, the Thailand Industrial Standards Institute (TISI) invited a Special
Working Group (SWG) to advance the work items defined at the Brisbane meeting. A
key topic of discussion was to clearly define the size of VSE that the SWG would
target, consensus being reached on IT services, organizations and projects with 1 to
25 employees. The major output of this one-week meeting was a draft of the New
Work Item (NWI) to be tabled at the next SC7 meeting.
In May 2005, a resolution was approved to distribute for ballot the NWI Proposal
for the development of Software Life Cycle Profiles and Guidelines for use in Very
Small Enterprises. Twelve countries voted in favor of the NWI Proposal [15]. As a
result of this vote, the Project was approved and the new working group, WG24, was
established.
The Thailand Industrial Standards Institute (TISI) sent out a second invitation to
participate in the SWG, to be held in September 2005 in Bangkok. The main objective
of the meeting was to prepare material that would be presented to WG24 in order to
facilitate the start-up of the working group that was scheduled for October 2005 in
Italy.
In October 2005, Italy hosted ISO/IEC JTC1 SC7 Interim Meeting. The New Work
Item was updated in order to take into account relevant comments received during
balloting, and the requirements were validated by WG members. In addition, some
VSE Business Models were identified, as was a strategy for creating profiles. Finally,
WG24 decided to conduct a survey to collect relevant information from VSEs around
the world.
4 Gathering VSE Requirements
In 1997, the Technical Council on Software Engineering responsible for the IEEE
Software Engineering Standards conducted a survey to capture information from
software engineering standards users in order to improve those standards [16]. They
gathered 148 answers, mainly from the USA (79%) and large companies (87% of
them having more than 100 employees). The main application domains of the survey
respondents were IT (22%), military (15%) and aerospace (11%). (It should be noted
that the purpose of this section is not to systematically compare the two sets of survey
results). Even though the IEEE survey objectives differ from those of the ISO/IEC
survey, there are some interesting common findings. In response to the question
concerning the reasons why their organization does not use standards, 37% said that
the standards were not available in their facilities, while 37% explained that they use
other standards. In fact, the IEEE survey underscores the fact that ISO/IEC standards
are often used in organizations, rather than the IEEE standards.
The IEEE survey underlined the difficulties regarding IEEE standards use reported by
the respondents. The two main difficulties were a lack of understanding of the
benefits (28%) and a lack of useful examples (25%). The survey also revealed how
IEEE standards are used in organizations. Most of the organizations claimed to use
IEEE standards for internal plan elaboration. The IEEE survey gathered several new
requirements about IEEE standards being requested by the respondents. These were
principally examples and templates of deliverables, support for metrics and
measurement, help on life cycle process definition, a training course and support for
small, rapid application development efforts.
