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Software development SMEs interested in launching a KM initiative or software project managers working on taking their KM initiative to the next level, need to assess what strategy will best fit their knowledge needs and which will be the most likely to succeed based on their social, cultural and technological aspects. Taking into account the social and cultural characteristics of Mexican software development SMEs, the Mexican Ministry of the Economy encouraged the creation and adoption of the NMX-I-059-NYCE-2005 Standard. The main goal of this standard is help SMEs become more competitive and reach higher maturity levels. However, SMEs adopting or implementing this standard sometimes experience difficulties and problems in their daily software activities. In this paper, we model ongoing knowledge flows as an adaptation to Choo’s framework, applied to the project portfolio management process as defined in such standard. In addition, we present some strategies followed by Mexican software development SMEs while conducting a SPI program for maturity levels 1 and 2.