Launching New Customers in a Day: CMC s Turnaround Story with Agile & DevOps

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1 Case Study Launching New Customers in a Day: CMC s Turnaround Story with Agile & DevOps By: Ryan Shriver 1

Founded in 2006, CMC has grown to provide solutions to lenders, which allow them to manage a single customer experience across their entire credit lifecycle.

2 CMC provides Customer Experience Management Solutions to a global portfolio of lenders. Their flagship product CredAgility automates customer experience processes including Marketing, Customer Service, Collections and Recovery. Founded in 2006, CMC has grown to provide solutions to lenders, which allow them to manage a single customer experience across their entire credit lifecycle. CMC s solutions improve customer experience, retention and profitability while reducing operational costs and risks. Challenges CMC is a fast growing software and solutions company, and in 2015 their growth trajectory was causing challenges across many aspects of product development. Despite an innovative market solution, they were challenged to consistently deliver on client commitments across multiple solutions and geographies. Sales of their enterprise platform, CredAgility, involved complex customization and custom-built features. These client-requested features were often hard to estimate and more complex to build than anticipated. Prospective clients naturally wanted fast implementation, so CMC needed to be aggressive in their delivery timelines and commitments to win deals. Increasingly, their aggressive approach caused missed commitments, poor quality and unhappy customers. It wasn t just the customers who were unhappy CMC s employees were feeling the pain too. Aggressive timelines and near-constant scope changes taxed the delivery teams, requiring nights and weekends of development. Defects and technical debt were piling up, and after each release a wave of new defects arose, spiking production support costs. CMC s quality problems were not just affecting existing customers. Word was getting around the lending community about their challenges, negatively impacting their sales pipeline. CMC s investors were increasingly concerned about the company s financial situation and long-term viability. Today CMC has a large portfolio of customers on their CredAgility managed service platform. CMC is serving customers around the world with 24/7 operations from offices and data centers in the US, Europe and Australia. We had the classic high growth challenge. Our solutions were very well received in the marketplace, leading to high demand and aggressive expectations. But we got out over our skis too far in terms of ensuring high quality delivery for each client, and so needed to re-gear our operations while continuing to grow. - Ray Peloso, CEO 2 3

3 Turn the Page In 2014, CMC hired Ray Peloso as COO to help CMC grow and drive scalability. Ray had a long career of running complex operations for banks but had no software company experience. Shortly after Ray s arrival CMC also hired Brian Harvell as head of technology, bringing in a seasoned technology executive to lead CMC s engineering teams. By the Summer of 2015, CMC had identified seven core areas of focus for the company s turnaround strategy. CMC engaged SingleStone in July to lead four of the areas: Agile Transition, Product Definition, Quality and Transition Roadmap Production Support. We spent the first week assessing the situation, getting to know Ray, Brian and their teams. In the second week we laid out a 12- week transition roadmap and provided recommendations for where they should focus for the best results. says Ryan Shriver, SingleStone s DevOps and Cloud solution lead. I knew 12 weeks was just the start of CMC s Agile journey, but based on experience I felt this was just enough to get their teams and management headed in the right direction with confidence. The transition roadmap defined a visual charter for the entire team, showing the key activities and overall plan for the four work streams. For each work stream, we defined the approach and our recommended actions. We also defined a communication plan and a weekly cadence to keep Ray, Brian and other leaders informed of progress. Current Phase (July 27 Oct 9) CMC was a group of talented employees with a great core technology around a unified customer experience platform; however, the organization lacked rigor and discipline on developing and deploying core Product features in a scalable way. Future Phases (Oct 10+) Agile Transition SingleStone initially recommended that CMC build three cross- functional Agile teams. One team focused on the product and two teams focused on US and International customer implementations, respectively. For the product team, we recommended they establish a regular release cadence, only demo real products to prospects and publish a forward looking product roadmap describing where CredAgility is heading. For project teams, we recommended customer implementation projects flow around the team s consistent two-week cadence. Each two-week cycle produced an incremental release and CMC had the option of deploying to a customer s test environment if quality was high. We also leaned out their Sales to Delivery process with clearer roles and responsibilities. This was all visualized on a single Kanban board in CMC s office so stakeholders could see all work in progress across the teams. Transition started with a one-day Agile introduction course for everyone, followed by more targeted training around topics including Effective User Stories and Roles of ScrumMaster and Product Owner. To help Scrum remain in practice, a seasoned Agile Transition Coach was imbedded within each team during their transition, leading by example and mentoring each team s ScrumMaster and Product Owner along the way. Quality SingleStone s approach to quality is to make it a part of the entire development lifecycle, not just test it out in the QA phase. We started from the beginning with training and workshops then worked side-by-side to help CMC learn to elicit requirements in a way that showed empathy for the user. We directly implemented personas, user stories, clear acceptance criteria and behavior-driven development. We worked side by side with quality assurance analysts helping them develop clear test scenarios and cases. On the tech side we set up automated code quality reporting with SonarCube and automated acceptance tests with Cucumber. All of these were integrated with CMC s continuous integration process, providing teams rapid feedback on each change. We conducted a search to identify the right firm to help us re-engineer our software development and deployment processes, and SingleStone came highly recommended and did not disappoint. 7/27 Assess Deploy Assess Quality 8/3 Product Team US Team Product Roadmap & Release Plans Automate Platform Deploy & Config in Ref Region Requirements and Testing 8/10 8/17 8/24 8/31 9/7 9/14 9/21 9/28 10/ Q Q Q2 Work Stream 1 Agile Transition Agile Transition Coaching & Training Assess Prod Support Work Stream 3 Product Definition International Team Code Quality Metrics Design Top Priority Service Mgmt. Processes Automate Product Deploy & Config Prep for Auto Testing Work Stream 6 Production Support Implement in JIRA Auto Client Deploy & Config Implement Auto Testing Work Stream 7 Quality Auto Env. Provision & Configure Continuous Delivery Design & Implement Service Mgmt. Processes Product Definition We worked directly with CMC s Product Owner to build and refine the CredAgility product backlog and publish the product roadmap. CredAgility is a platform containing multiple products with hundreds of features. Historically there was confusion between what was sold and what the customer expected to be delivered. To solve this, we worked with CMC to define a manifest that defined the specific set of features toggled on/off. This enabled them to accurately define new products and customer-specific releases in a transparent way. Taking it one step further, our DevOps engineers worked directly with CMC s development team to fully automate the deployment Production Support We worked with CMC s IT Operations leaders and teams to understand their challenges, and introduced the ITIL vocabulary for service management. Starting with change, then incident and release management, we introduced service management best practices into their current processes with clear maps that clarified flow and accountability. Each went through multiple feedback cycles. The result was clarity on how IT Operations works both for the team and their internal customers. Using these designs, CMC implemented custom workflows in JIRA to connect the design with the team s service management tool of choice. and configuration of CredAgility in new environments. 4 5

4 Fast Forward Six Months SingleStone completed the engagement in October of their results with SingleStone. Since their transformation By April 2016, CMC had grown from 3 to 5 Agile began, CMC has shown some amazing improvements teams and had established an organizational culture including improved flow of work, improved quality, where Agile was just the way work was done. 30 weeks reduced production support costs, faster time to market, (15 Sprints) after they started their transition, CMC shared and improved team morale. Improved Flow of Work The percentage of stories accepted by the Product Owner by the end of each Sprint has increased from 32% to 94%. The percentage of stories ready before each Sprint has increased from 38% to 100%. Teams are working collaboratively together to define clear acceptance criteria and test user stories within each Sprint, and the results speak for themselves. In January 2016 CMC hired an experienced QA manager and were focused on writing clear user stories and acceptance criteria for all new features. An initial baseline showed that historically customers were finding over 60% of all defects in their UAT environment. CMC created a new quality metric Defect Removal Efficiency with a target that in 2016 customers would find less than 1 in 10 defects. They begin tracking this metric weekly. Five months later customers are finding less than 10% of all defects and CMC has revised their target so customers find less than 5% of defects by year s end. 100% 90% 80% 70% 60% 50% 40% Defect Removal Efficiency 91.4% 97.5% 93.2% 96.5% 86.5% 40% Dec Jan Feb Mar Apr May Accepted Ready Reduced Production Support Costs 100% The improvement in quality is having positive impacts on the bottom line. Production support costs are down 51%, saving 170 hours a week. In addition, response times for support tickets is 20% faster than before. 80% Sprint 7 Agile Teams Sprint 19 60% 40% 20% 0% Sprint 7 Agile Teams Sprint 19 it usually meant a client had a problem. Our ability to reduce these interactions by more CMC knew that Production Support interactions were negative in general, since than 50% is critically important to increasing our client s confidence that we can meet their needs when they call us. Weekly Production Support Hours User stories Accepted each Sprint increased 32% to 94%. User stories Ready for each Sprint increased 38% to 100%. 51% reduction in production support hours Hours Improved Quality Perhaps the most powerful impact for CMC was improving the quality of the CredAgility product. Prior to 2015, CMC had few quality metrics and none were tracked and managed. Anecdotally customers found a lot of defects in their User Acceptance Test (UAT) environments, but no baselines existed Support Ticket Resolution Time Jan Feb Mar Apr Our work with SingleStone on Quality was transformational. In six short months we went from not knowing our Quality performance to removing more than 90% of defects PRIOR TO client UAT. Our internal staff deserves credit for working alongside SingleStone to make this happen. I cannot overstate how important this progress has been. Hours Severity 2 Tickets Severity 3 Tickets Support tickets are resolved 20% faster than a year ago 2Q15 3Q15 4Q15 Jan Feb Mar Apr May 6 7

5 Faster Time to Market Consistent quality and a focus on DevOps practices In 2016 CMC is focused on selling their current product related to automation have dramatically decreased the release to prospects and current customers, reducing time required to set up new clients. What used to take the number of custom-built features in each deal. This, months now takes weeks or less. Today, CMC can meet combined with improved quality and rapid launches, is with a prospective client in the morning and quickly enabling CMC to earn revenue faster. By April 2016, the deploy a fully configured, running environment for them time from contract signing to customer launch has been by the afternoon! reduced from 4-5 months to 2-3 weeks, bringing forward revenue and increasing profitability. of deployment time and very high complexity. Our sales approach of proposing Clients normally think about us as an enterprise solution, implying months rapid deployment in weeks is a refreshingly different message and has allowed us to differentiate ourselves. Improved Team Morale The benefits don t stop with customers and operations; 80-hour weeks during stressful client implementations. employees have felt the difference too. In the fall of Those days are in the rear-view mirror and employees are 2015, CMC rolled out a policy requiring employees to achieving a better work-life balance with less stress. track their hours in JIRA, something that had previously not been done. Employees met this new policy with Colleagues now report more confidence in the ability of resistance and it took a while for it to take effect. CMC to deliver a consistent deployment, and they feel However once CMC was in their full Agile transition, a more tangible connection with the work they deliver, the average workweek for development teams dropped leveraging Agile ceremonies as a means to close loops to a more normal cadence. At the start of the transition and declare work completed. it was not uncommon for some team members to work we now have a much more structured and organized approach to software The CMC team has really embraced the cultural shifts to Agile and development. Our real objective was to deliver better quality code to our clients in a more consistent way, and so the rituals and routines of Agile allow a sense of accomplishment and measurement that is very rewarding. The Future is Bright With their Agile transition in full swing, the future is bright for CMC. In the midst of the impressive turnaround, Ray was promoted to CEO. Now with responsibility for not just operations but the entire organization, Ray is seeing first-hand the impact Agile has made on the entire organization. Bigger Sales Pipeline Perhaps most impressive is CMC s current sales pipeline, the largest in company history, both in volume and dollars. CMC has twice the number of qualified leads in their pipeline today as a result of having a more competitive offering. Their new pricing reflects a product deployment time of weeks instead of months and greater confidence that higher quality will lower performance issues and costs. Opening New Markets CMC now believes that its lower operating costs and faster delivery will help them enter new markets. Where we historically competed in enterprise deals with large global lenders who tended to be comfortable with expectations of cost and complexity, we are now finding ourselves very competitive with alternative lenders and smaller lending institutions that previously would not have been able to afford our offerings, says Ray Peloso. Summary Improved quality, faster time to market, lower operating costs, increased profitability and a growing sales pipeline. CMC is demonstrating these key metrics are directly connected. Strong change leadership and Agile adoption, combined with a focus on the product and DevOps automation, is creating a virtuous cycle of continuous improvement. For CMC, the future is bright! CMC s Change Program with SingleStone provided a transformational business model pivot that has really altered our trajectory for profitable and sustainable growth Increased Profitability As one might expect, faster time to revenue and lower costs are translating into increased profitability. CMC has experienced a significant improvement in deployment economics, allowing CMC to get to licensing and subscription revenue 3-4 times faster than was previously possible. More importantly, this will support more aggressive scaling and velocity as CMC can now drive more new business with the same level of staffing. This should naturally lead to more profit that CMC can use to make strategic investments and pay investor dividends. Improved Flow of Work 94% of Stories Accepted each sprint Improved Quality Greater than 95% of defects removed before customer use Reduced Production Support Costs 51% reduction in production support hours Faster Time to Market 4-5 months to 2-3 weeks Sales Pipeline 2x qualified leads Improved Team Morale Happier teams 8 9

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About SingleStone SingleStone is a Richmond, VA-based consulting firm that specializes in

Our expertise spans technology, strategy, business processes and design, and we combine

enjoyable for our clients to collaborate with colleagues and effectively serve their

6 Want to Learn More? Visit the DevOps Cloud Solution at SingleStoneConsulting.com to learn how your organization can become the next CMC. About SingleStone SingleStone is a Richmond, VA-based consulting firm that specializes in reducing friction and removing barriers in business. Our expertise spans technology, strategy, business processes and design, and we combine those disciplines to create processes, tools and experiences that make it easy and enjoyable for our clients to collaborate with colleagues and effectively serve their customers Cox Road, Suite 350 Glen Allen, VA SingleStoneConsulting.com Ryan Shriver DevOps and Cloud Solution Lead rshriver@singlestoneconsulting.com 10

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