With employees, consultants, and outsourced firms, there is always risk as to the quality of what is being produced. Because of these risks, it is important that the Program Manager understands the importance of protecting the corporate assets. Service Level Agreements are an effective means of protecting corporations from this vendor risk.

The management of people is the responsibility of the Project Manager who may or may not be an employee of the company. They are accountable for the quality of what is produced. The Program Manager is responsible for the success of the program and the product. It is their responsibility to be sure that all of the pieces work together and that the goals and objectives of the program and product are satisfied. The Program Manager must also manage the risks associated with the product, as well as manage the leaders of each group to nurture the integrative and collaborative behaviors of the diverse groups. This, in turn, will reduce the occurrence of wasted time and resources, and ensure product quality.

The Software Engineering Institute (SEI), a branch of Carnegie Mellon University, has several models to help firms build better products. Each model contains several Key Process Areas (KPA's). These KPA's address a specific infrastructure component to building Information Technology related products. The Capability Maturity Model® Integration^sm (CMMI) for building system and software systems identifies KPA's that directly affect the quality of the system being built. For the purposes of this discussion, only one of the KPA's in the CMMI model, the Supplier Agreement Management (SAM), will be discussed, as it directly affects the corporate assets.

In plain English, SAM is a process that defines how to:

• Determine what to outsource or specifically which consultants (knowledge) is needed.
• Establish agreements, complete with quantitative objectives. This includes confidentiality and non-disclosure agreements.
• Select vendors.
• Monitor the performance and satisfaction of the agreement.
• Review, test and accept the final deliverables.

The CMMI discusses the activity of SAM in terms of:

• Purchasing commercial off-the-shelf (COTS) products.
• Obtaining products through a contractual agreement.
• Obtaining products from an in-house vendor.
• Obtaining products from the customer.
• Combining some of the above.

The purpose of SAM is to manage the acquisition of work products that are produced by suppliers, both consultants and outsourced firms, for which there exists a formal agreement. It defines specifically what the person is accountable for, the means of achieving satisfaction, and what to do in terms of the unexpected. SAM ensures that everyone knows what is expected from them and when. Because these expectations are in writing, they can be monitored and changed through an established change process.

Placing such important agreements in writing, in an unambiguous manner, will help control the projects within the program as well as maintaining the quality of the product itself.

SBDi has experienced Program Managers on staff to help you with your large-scale mission-critical products. We can assist your organization in defining the program's charter and service level agreements. We also have expertise with other key process areas that will provide value to your organization.

Pat Ferdinandi