What does World-Class Mean?

Most software companies are already quite successful, they deliver products which customers are buying, their teams are functioning, releases are happening and they use mostly modern engineering practices. In other words, those companies are fit for purpose. There is nothing wrong with being fit for purpose, it gets the job done.

Yet, there is another level of operation, this is where you find world-class companies.

The main characteristics of a world class software company are:

1. Known inefficiencies are systematically removed

2. The organization consistently delivers superior results

3. Its performance exceeds most peers in their industry and

4. It becomes a reference point for others to learn from

The path to becoming world-class requires more than a mindset shift and individual improvements, the world-class organization takes a different approach:

1. Holistic SDLC Visibility

   1. They understand the entire system and optimize it continuously. It starts with understanding the effectiveness of every stage across the development cycle and being able to tell which area is holding back the organization at any given moment

2. Improve What Matters Most

   1. They focus on the weakest constraint in the system in each iteration, putting all focus on solving this one specific problem and ignoring all others. This ensures the fastest possible route for improvement for any given improvement budget and minimizes redundant local improvement initiatives that will not benefit for system in its whole

3. Continuous Progress by Design

   1. They treat process improvements as quantifiable deliverables in every iteration, improvement is no longer optional or a side effect that is done if time allows. Getting better at the way the team is doing things is a mandatory requirement for every iteration

4. Use External Feedback Loops

   1. It is difficult for an organization to improve without external, industry benchmark perspective on improvement opportunities. A learning organization needs external stimulation. 

Once those components are in place, the world-class organization witnesses incredible results. By continuously identifying bottlenecks, improving what matters most, and making process improvement part of every iteration, they achieve:

1. Faster time to market each year, which translates into more capacity available for innovation.

2. Higher quality in deliveries with higher customer satisfaction, releases become more predictable.

3. Lower costs, less rework and waste each year and better return on investment

As the execution engine matures and the process effectiveness grows, the world-class organization becomes a reference point for others to learn from. You can see them provide keynotes and lead conferences on specific engineering practices, you find them publishing articles and releasing patents on the specific methodologies they use. Once you find yourself in that position, know that you’re on the right track to become world class.