Regardless of their size, software firms search for better methods to improve the delivery of their projects. The SEI Capability Maturity Model (CMM) is one available framework employed to assist in improving this process. The challenge of identifying the benefits associated with implementation of CMM Level 2 practices for the smaller software development firm is the main focus of this research. The objective is to evaluate the impact of each key process area of CMM 2 on productivity, product quality and ability to meet deadlines. A simulation model is designed to help researchers in software development, and management teams in SMEs, understand the impact of alternative management policies and practices according to CMMD. The results indicate that the CMM’s software quality assurance process area has a sizeable impact on productivity and that all CMM process areas impact scheduling activities. The process areas associated with project management (software project planning and software project tracking) have very little impact on product quality as opposed to the other process areas with impacts more substantial on this performance measure. The analysis of scenarios indicates that the adoption of CMM2 practices based on requirements management yields more positive results than policies based on project management.