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41-509: Capability Maturity Model Integration ( CMMI ) is a process level improvement training and appraisal program. Administered by the CMMI Institute , a subsidiary of ISACA , it was developed at Carnegie Mellon University (CMU). It is required by many U.S. Government contracts, especially in software development . CMU claims CMMI can be used to guide process improvement across a project, division, or an entire organization. CMMI defines

82-405: A corporate , although this term can also apply to cooperating companies and their subsidiaries with varying degrees of shared ownership. A parent company does not have to be the larger or "more powerful" entity; it is possible for the parent company to be smaller than a subsidiary, such as DanJaq , a closely held family company, which controls Eon Productions , the large corporation which manages

123-487: A definition that provides that "control" is "the capacity of an entity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of another entity so as to enable that other entity to operate with it in pursuing the objectives of the controlling entity". This definition was adapted in the Australian Corporations Act 2001 : s 50AA. Furthermore, it can be

164-404: A joint arrangement (joint operation or joint venture) over which two or more parties have joint control (IFRS 11 para 4). Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. The Companies Act 2006 contains two definitions: one of "subsidiary" and

205-432: A judgment against the parent if they can pierce the corporate veil and prove that the parent and subsidiary are mere alter egos of one another. Thus any copyrights, trademarks, and patents remain with the subsidiary until the parent shuts down the subsidiary. Ownership of a subsidiary is usually achieved by owning a majority of its shares . This gives the parent the necessary votes to elect their nominees as directors of

246-698: A process improvement program or for rating prospective suppliers. The method defines the appraisal process as consisting of preparation; on-site activities; preliminary observations, findings, and ratings; final reporting; and follow-on activities. The suite of documents associated with a particular version of the CMMI includes a requirements specification called the Appraisal Requirements for CMMI (ARC), which specifies three levels of formality for appraisals: Class A, B, and C. Formal (Class A) SCAMPIs are conducted by SEI-authorized Lead Appraisers who use

287-488: A separate model each) were merged into a single model. CMMI was developed by a group from industry, government, and the Software Engineering Institute (SEI) at CMU. CMMI models provide guidance for developing or improving processes that meet the business goals of an organization. A CMMI model may also be used as a framework for appraising the process maturity of the organization. By January 2013,

328-594: A similar use of CMMI, Extreme Programming ( XP ), a software engineering method, has been evaluated with CMM/CMMI (Nawrocki et al., 2002). For example, the XP requirements management approach, which relies on oral communication, was evaluated as not compliant with CMMI. CMMI can be appraised using two different approaches: staged and continuous. The staged approach yields appraisal results as one of five maturity levels. The continuous approach yields one of four capability levels. The differences in these approaches are felt only in

369-421: A single model where each process area potentially has a specific reference to one or more of these three aspects. Trying to keep up with the industry the model also has explicit reference to agile aspects in some process areas. Some key differences between v1.3 and v2.0 models are given below: An organization cannot be certified in CMMI; instead, an organization is appraised . Depending on the type of appraisal,

410-462: A subsidiary undertaking, if: The broader definition of "subsidiary undertaking" is applied to the accounting provisions of the Companies Act 2006, while the definition of "subsidiary" is used for general purposes. In Oceania , the accounting standards defined the circumstances in which one entity controls another. In doing so, they largely abandoned the legal control concepts in favour of

451-632: A useful part of the company that allows every head of the company to apply new projects and latest rules. Standard CMMI Appraisal Method for Process Improvement The Standard CMMI Appraisal Method for Process Improvement ( SCAMPI ) is the official Software Engineering Institute (SEI) method to provide benchmark-quality ratings relative to Capability Maturity Model Integration (CMMI) models. SCAMPI appraisals are used to identify strengths and weaknesses of current processes, reveal development/acquisition risks, and determine capability and maturity level ratings. They are mostly used either as part of

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492-1002: Is a subsidiary/child company of the ultimate parent company, while a second-tier subsidiary is a subsidiary of a first-tier subsidiary: a "grandchild" of the main parent company. Consequently, a third-tier subsidiary is a subsidiary of a second-tier subsidiary—a "great-grandchild" of the main parent company. The ownership structure of the small British specialist company Ford Component Sales, which sells Ford components to specialist car manufacturers and OEM manufacturers, such as Morgan Motor Company and Caterham Cars , illustrates how multiple levels of subsidiaries are used in large corporations: The word "control" and its derivatives (subsidiary and parent) may have different meanings in different contexts. These concepts may have different meanings in various areas of law (e.g. corporate law , competition law , capital markets law ) or in accounting . For example, if Company A purchases shares in Company B, it

533-615: Is an appraisal method that meets all of the ARC requirements. Results of a SCAMPI appraisal may be published (if the appraised organization approves) on the CMMI Web site of the SEI: Published SCAMPI Appraisal Results. SCAMPI also supports the conduct of ISO/IEC 15504 , also known as SPICE (Software Process Improvement and Capability Determination), assessments etc. This approach promotes that members of

574-497: Is possible that the transaction is not subject to merger control (because Company A had been deemed to already control Company B before the share purchase, under competition law rules), but at the same time Company A may be required to start consolidating Company B into its financial statements under the relevant accounting rules (because it had been treated as a joint venture before the purchase for accounting purposes). Control can be direct (e.g., an ultimate parent company controls

615-470: The James Bond franchise. Conversely, the parent may be larger than some or all of its subsidiaries (if it has more than one), as the relationship is defined by control of ownership shares, not the number of employees. The parent and the subsidiary do not necessarily have to operate in the same locations or operate the same businesses. Not only is it possible that they could conceivably be competitors in

656-437: The CMMI for services model: Maturity Level 2 – Managed Maturity Level 3 – Defined Maturity Level 4 – Quantitatively Managed Maturity Level 5 – Optimizing CMMI best practices are published in documents called models, each of which addresses a different area of interest. Version 1.3 provides models for three areas of interest: development, acquisition, and services. In version 2.0 DEV, ACQ and SVC were merged into

697-467: The CMMI model mostly deals with what processes should be implemented, and not so much with how they can be implemented. These results do not guarantee that applying CMMI will increase performance in every organization. A small company with few resources may be less likely to benefit from CMMI; this view is supported by the process maturity profile (page 10). Of the small organizations (<25 employees), 70.5% are assessed at level 2: Managed, while 52.8% of

738-526: The EPG and PATs be trained in the CMMI, that an informal (SCAMPI C) appraisal be performed, and that process areas be prioritized for improvement. More modern approaches, that involve the deployment of commercially available, CMMI-compliant processes, can significantly reduce the time to achieve compliance. SEI has maintained statistics on the "time to move up" for organizations adopting the earlier Software CMM as well as CMMI. These statistics indicate that, since 1987,

779-838: The Office of the Secretary of Defense ( OSD ) and the National Defense Industrial Association . CMMI is the successor of the capability maturity model (CMM) or Software CMM. The CMM was developed from 1987 until 1997. In 2002, version 1.1 was released, version 1.2 followed in August 2006, and version 1.3 in November 2010. Some major changes in CMMI V1.3 are the support of agile software development , improvements to high maturity practices and alignment of

820-489: The above representation separation was cancelled and there is now only one cohesive model. Depending on the areas of interest (acquisition, services, development) used, the process areas it contains will vary. Process areas are the areas that will be covered by the organization's processes. The table below lists the seventeen CMMI core process areas that are present for all CMMI areas of interest in version 1.3. The process areas below and their maturity levels are listed for

861-789: The appraisal; the best practices are equivalent resulting in equivalent process improvement results. Subsidiary The subsidiary can be a company (usually with limited liability ) and may be a government-owned or state-owned enterprise . They are a common feature of modern business life, and most multinational corporations organize their operations in this way. Examples of holding companies are Berkshire Hathaway , Jefferies Financial Group , The Walt Disney Company , Warner Bros. Discovery , or Citigroup ; more focused companies include IBM , Xerox , and Microsoft . These, and others, organize their businesses into national and functional subsidiaries, often with multiple levels of subsidiaries. Subsidiaries are separate, distinct legal entities for

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902-568: The continuous representation, each with a specific set of improvement goals. Examples are the CMMI Project Roadmap, CMMI Product and Product Integration Roadmaps and the CMMI Process and Measurements Roadmaps. These roadmaps combine the strengths of both the staged and the continuous representations. The combination of the project management technique earned value management (EVM) with CMMI has been described. To conclude with

943-561: The different fragments of the methods into a new hybrid method. Sutherland et al. (2007) assert that a combination of Scrum and CMMI brings more adaptability and predictability than either one alone. David J. Anderson (2005) gives hints on how to interpret CMMI in an agile manner. CMMI Roadmaps, which are a goal-driven approach to selecting and deploying relevant process areas from the CMMI-DEV model, can provide guidance and focus for effective CMMI adoption. There are several CMMI roadmaps for

984-651: The entire CMMI product suite was transferred from the SEI to the CMMI Institute, a newly created organization at Carnegie Mellon. CMMI was developed by the CMMI project, which aimed to improve the usability of maturity models by integrating many different models into one framework. The project consisted of members of industry, government and the Carnegie Mellon Software Engineering Institute (SEI). The main sponsors included

1025-453: The first-tier subsidiary directly) or indirect (e.g., an ultimate parent company controls second and lower tiers of subsidiaries indirectly, through first-tier subsidiaries). Recital 31 of Directive 2013/34/EU stipulates that control should be based on holding a majority of voting rights, but control may also exist where there are agreements with fellow shareholders or members. In certain circumstances, control may be effectively exercised where

1066-487: The following five maturity levels (1 to 5) for processes: Initial, Managed, Defined, Quantitatively Managed, and Optimizing. CMMI Version 3.0 was published in 2023; Version 2.0 was published in 2018; Version 1.3 was published in 2010, and is the reference model for the rest of the information in this article. CMMI is registered in the U.S. Patent and Trademark Office by CMU. Originally CMMI addresses three areas of interest: In version 2.0 these three areas (that previously had

1107-427: The following process areas: While they do not affect maturity or capability levels, these process areas can be reported in appraisal results. The SEI published a study saying 60 organizations measured increases of performance in the categories of cost, schedule, productivity, quality and customer satisfaction. The median increase in performance varied between 14% (customer satisfaction) and 62% (productivity). However,

1148-401: The hard copy publication of CMMI for Development Version 1.2 and 1.3. The Addison-Wesley publication of Version 1.3 was dedicated to the memory of Watts Humphry. Eileen C. Forrester, Brandon L. Buteau, and Sandy Shrum were the authorship team for the hard copy publication of CMMI for Services Version 1.3. Rawdon "Rusty" Young was the chief architect for the development of CMMI version 2.0. He

1189-555: The marketplace, but such arrangements happen frequently at the end of a hostile takeover or voluntary merger. Also, because a parent company and a subsidiary are separate entities, it is entirely possible for one of them to be involved in legal proceedings, bankruptcy, tax delinquency, indictment or under investigation while the other is not. In descriptions of larger corporate structures, the terms "first-tier subsidiary", "second-tier subsidiary", "third-tier subsidiary", etc. describe multiple levels of subsidiaries. A first-tier subsidiary

1230-429: The median times to move from Level 1 to Level 2 is 23 months, and from Level 2 to Level 3 is an additional 20 months. Since the release of the CMMI, the median times to move from Level 1 to Level 2 is 5 months, with median movement to Level 3 another 21 months. These statistics are updated and published every six months in a maturity profile. The Software Engineering Institute's (SEI) team software process methodology and

1271-607: The organization can be awarded a maturity level rating (1–5) or a capability level achievement profile. Many organizations find value in measuring their progress by conducting an appraisal. Appraisals are typically conducted for one or more of the following reasons: Appraisals of organizations using a CMMI model must conform to the requirements defined in the Appraisal Requirements for CMMI (ARC) document. There are three classes of appraisals, A, B and C, which focus on identifying improvement opportunities and comparing

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1312-452: The organization's immediate business objectives, or those to which the organization assigns a high degree of risks. The staged representation is designed to provide a standard sequence of improvements, and can serve as a basis for comparing the maturity of different projects and organizations. The staged representation also provides for an easy migration from the SW-CMM to CMMI. In version 2.0

1353-486: The organization's processes to CMMI best practices. Of these, class A appraisal is the most formal and is the only one that can result in a level rating. Appraisal teams use a CMMI model and ARC-conformant appraisal method to guide their evaluation of the organization and their reporting of conclusions. The appraisal results can then be used (e.g., by a process group) to plan improvements for the organization. The Standard CMMI Appraisal Method for Process Improvement (SCAMPI)

1394-440: The organizations with 1,001–2,000 employees are rated at the highest level (5: Optimizing). Turner & Jain (2002) argue that although it is obvious there are large differences between CMMI and agile software development , both approaches have much in common. They believe neither way is the 'right' way to develop software, but that there are phases in a project where one of the two is better suited. They suggest one should combine

1435-482: The other "subsidiary undertaking". According to s.1159 of the Act, a company is a "subsidiary" of another company, its "holding company", if that other company: The second definition is broader. According to s.1162 of the Companies Act 2006, an undertaking is a parent undertaking in relation to another undertaking, a subsidiary undertaking, if: An undertaking is also a parent undertaking in relation to another undertaking,

1476-471: The parent holds a minority or none of the shares in the subsidiary. According to Article 22 of the directive 2013/34/EU an undertaking is a parent if it: Additionally, control may arise when: Under the international accounting standards adopted by the EU a company is deemed to control another company only if it has all the following: A subsidiary can have only one parent; otherwise, the subsidiary is, in fact,

1517-430: The purposes of taxation , regulation and liability . For this reason, they differ from divisions which are businesses fully integrated within the main company, and not legally or otherwise distinct from it. In other words, a subsidiary can sue and be sued separately from its parent and its obligations will not normally be the obligations of its parent. However, creditors of an insolvent subsidiary may be able to obtain

1558-420: The representation (staged and continuous). According to the Software Engineering Institute (SEI, 2008), CMMI helps "integrate traditionally separate organizational functions, set process improvement goals and priorities, provide guidance for quality processes, and provide a point of reference for appraising current processes." Mary Beth Chrissis, Mike Konrad, and Sandy Shrum Rawdon were the authorship team for

1599-460: The subsidiary, and so exercise control. This gives rise to the common presumption that 50% plus one share is enough to create a subsidiary. There are, however, other ways that control can come about, and the exact rules both as to what control is needed, and how it is achieved, can be complex (see below). A subsidiary may itself have subsidiaries, and these, in turn, may have subsidiaries of their own. A parent and all its subsidiaries together are called

1640-514: The use of CMMI models can be used to raise the maturity level. A new product called Accelerated Improvement Method (AIM) combines the use of CMMI and the TSP. To address user security concerns, two unofficial security guides are available. Considering the Case for Security Content in CMMI for Services has one process area, Security Management. Security by Design with CMMI for Development, Version 1.3 has

1681-697: Was previously the CMMI Product Owner and the SCAMPI Quality Lead for the Software Engineering Institute. In March 2016, the CMMI Institute was acquired by ISACA . In April 2023, the CMMI V3.0 was released. In version 1.3 CMMI existed in two representations: continuous and staged. The continuous representation is designed to allow the user to focus on the specific processes that are considered important for

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