Intermediate Earned Value
Management (EVM 202)
STUDENT GUIDE
DEFENSE ACQUISITION UNIVERSITY
November 2017
EVM 202—Intermediate Earned Value Management Course Schedule
MONDAY
TUESDAY
0800–1205
Lesson 1—Introduction to
EVM 202 and the LAR
Vehicle Program
Presentations and Brief Out
WEDNESDAY
0800–0900
Lesson 2 (cont.)
Exercise Review
THURSDAY
0800–1200
Lesson 4 (cont.)
1300–1700
Lesson 2—EVM in the
Acquisition Strategy
1255–1700
Lesson 4 (cont.)
1115–1215
Lesson 5—EVMS
Surveillance
1300–1530
Lesson 4 (cont.)
Presentations and Brief Out
1530 –1700
Exam 1 Preparation and
student study time
MONDAY
0800–1205
Lesson 6 (cont.)
TUESDAY
0800–1100
Lesson 6 (cont.)
Exercise Review
WEDNESDAY
THURSDAY
0800–1000
Lesson 7 (cont.)
Presentations and Brief out
0800–1200
Lesson 9—Integrated
Program Management Case
1000–1200
Lesson 8—IPT Analysis and
Performance Case
1305–1700
Lesson 6 (cont.)
1200–1700
Lesson 7—Tools Analysis
Case
1300–1700
Lesson 8 (cont.)
Presentations and Brief Out
0800–0945
Exam 1 & Debrief
0945–1115
Lesson 4 (cont.)
0900–1005
Lesson 3—EVMS
Implementation
1005–1155
Lesson 4—Integrated
Baseline Review Process
Travel Day
FRIDAY
1300–1435
Lesson 5 (cont.)
1435–1700
Lesson 6—Integrated
Program Management
Analysis Tools and
Techniques
FRIDAY
0800–0945
Exam 2
0945–1100
Course Survey, Clean-up,
Exam 2 Debrief, Graduation
1300–1630
Lesson 9 (cont.)
Presentations and Brief Out
1630–1700
Exam 2 Preparation
EVM 202
November 2017
i
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EVM 202
November 2017
ii
TABLE OF CONTENTS
1.
2.
3.
4.
5.
6.
7.
8.
9.
Lesson 1: Introduction to EVM 202 and the LAR Vehicle Program
Lesson 2: EVM in the Acquisition Strategy
Lesson 3: EVMS Guidelines and Compliance
Lesson 4: Integrated Baseline Review (IBR) Process
Lesson 5: EVMS Surveillance
Lesson 6: Integrated Program Management Analysis Tools and Techniques
Lesson 7: Tool Analysis Case Study
Lesson 8: Integrated Product Team (IPT) Analysis and Performance Case
Lesson 9: Integrated Program Management Case Study
EVM 202
November 2017
iii
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EVM 202
November 2017
iv
EVM 202 Lesson 1:
Introduction to EVM 202 and the
LAR Vehicle Program
STUDENT GUIDE
CONTENTS
1.
2.
3.
4.
5.
Learning Objectives and Additional References
LAR Vehicle Scenario
Presentation Slides
Introduction to Blackboard Materials
Exercise Instructions
EVM 202
November 2017
Lesson 1-1
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EVM 202
November 2017
Lesson 1-2
Learning Objectives and Additional References
Terminal Learning Objective
Given a program scenario and accompanying documents, construct a brief that summarizes key
program information.
Enabling Learning Objective
Given program documentation, describe program requirements, risks, and constraints in order
to use EVM effectively.
Additional References
•
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
All other necessary references are available in the Lightweight, Assault and
Reconnaissance (LAR) Vehicle simulation.
EVM 202
November 2017
Lesson 1-3
LAR Vehicle Scenario
Background
In 2012, the Army leadership announced a vision of the future. This vision includes a Brigade
structure and organization, which is crucial to the Army’s strategic responsiveness goals of
deploying from a Continental United States (CONUS) base to a global theater of operation.
These goals include deploying: one Brigade within 96 hours; one Division within 120 hours; and
five Divisions within 30 days. To achieve this vision for the Army, the Tank-automotive and
Armaments Command (TACOM) and United States Joint Forces Command (USJFC) initiated a
Class II Joint Capability Technology Demonstration (JCTD) of a Lightweight, Assault and
Reconnaissance (LAR) Vehicle.
It is now July 2015 and you have just arrived at the LAR Vehicle Program Office headed by
Colonel (COL) Paine. The JCTD LAR is currently undergoing operational testing and the vehicle
shows great promise. However, early test results identified problems that must be resolved
before production. To address these minor deficiencies, a JCTD transition plan has been
developed and approved, establishing the LAR Vehicle program as new start. A request for
proposals (RFP) for the Engineering & Manufacturing Development (EMD) contract is in the
early stages of formulation. A Milestone B (MS) decision briefing is scheduled for early March
2016. A non-firm-fixed-price (FFP) contract is planned with estimated costs ranging between
$600 and $800 million.
Relevant Information
The Senior Acquisition Executive (SAE), General (GEN) Moatars, wants COL Paine to strongly
consider eliminating Earned Value Management and any type of schedule management or
reporting requirements from the RFP. He feels that the contractor is being paid to manage the
effort and how they choose to do, it is their business. If he cannot be convinced otherwise, he
will direct COL Paine to process a waiver to eliminate Earned Value Management (EVM). COL
Paine must convince GEN Moatars that earned value will help the Program Office effectively
manage the contract.
EVM 202
November 2017
Lesson 1-4
Introduction to Blackboard Course Materials
Most EVM 202 lessons have a corresponding PowerPoint and a combination of briefings, tasks,
and references/tools on Blackboard. A normal lesson typically begins with the LAR Vehicle
program scenario in the Student Guide. Some lessons also have briefings about the topic area.
You will use briefings and references to complete assigned tasks. You will complete your tasks
either by using your team’s group File Exchange in Blackboard (which functions similar to a
shared drive), or by using other materials such as a classroom whiteboard, easel paper, or
worksheet. Your team’s group is available via the Team Groups tab on the Course Menu.
EVM 202
November 2017
Lesson 1-5
Welcome! While you are waiting . . .
• Review your Student Locator Card:
– Verify supervisor email and phone number
– Verify emergency contact name and phone number
– Add your contact information
• Include cell phone or hotel phone number if TDY or if different from
emergency contact
– Course Title: Intermediate Earned Value Management Course (IEVMC)
– Course Number: EVM 202
– Signature: On bottom of sheet
• Update ATLAS profile to make changes permanent
1
September 2016
Intermediate Earned Value Management Course (EVM 202)
EVM 202
November 2017
Lesson 1-6
Administration
• Turn off or silence your cell phones
• Put your first name on your name card in LARGE PRINT
• This is your duty station for the duration of the course
• Dress code (business casual/professional):
– No jeans, corduroy, shorts, t-shirts, tank tops, or athletic clothing
– No sneakers, flip-flops, or slippers
– No dress-down Fridays/travel days
• Dress code violators will be sent home
3
Removable Memory Devices
• Do NOT insert or connect removable memory device(s) into
DAU computers
– Poses security risk
– Examples:
•
•
•
•
•
•
Jump/flash/thumb drives/memory sticks
Floppy disks
SD/XD cards
CD-R/W & DVD-R/W
iPods
Portable electronic devices, etc.
• Computers for Unclassified use only
4
EVM 202
November 2017
Lesson 1-7
Non-Attribution Policy
5
DAU Briefing
6
EVM 202
November 2017
Lesson 1-8
EVM 202 Assessments
• Total Assessment: 100 Points (Open Book, Blackboard, and
Notes)
– Exam 1: 40 Points (60 minutes, Friday Week 1)
• Multiple choice, true/false, multiple answer, and fill in the blank
– Lesson 9: 20 Points (Integrated Program Management Group Exercise)
– Exam 2: 40 Points (90 minutes, Friday Week 2)
• Multiple choice and multiple answer
• Must achieve 80 total points to pass EVM 202
7
Course Materials—Blackboard Materials
•
•
•
•
Schedule (digital copy)
• LAR Vehicle Documentation
– Acquisition Strategy
Student Guide (digital copy)
– Capability Development
Lesson slides
Document (CDD)
Briefings, tasks, and references
– Acquisition Program Baselines
– Video briefings
– Tasks and briefing templates
– Lesson references and tools,
including Empower
(APBs)
– Integrated Baseline Review
(IBR) Documents
– LAR Vehicle schedules
– LAR Vehicle Program Control
Books
• Resources
– EVM references
– Job aids
• Pre-Course Self-Assessment
• Exams 1 and 2
8
EVM 202
November 2017
Lesson 1-9
Course Schedule
EVM 202 Course Schedule
Week
Monday
Tuesday
Wednesday
Thursday
Friday
Week 1
Travel Day
Lesson 1
(Morning)
Lesson 2
(Morning)
Lesson 4: Part 3
(Morning and
Exam 1 (Morning)
Lesson 4: Part 4
Lesson 2
(Afternoon)
Lesson 3
(Morning)
Afternoon)
Lesson 5
(Morning)
Lesson 4: Parts 1
and 2 (Morning
and Afternoon)
Week 2
Lesson 6
(Morning and
Afternoon)
Lesson 6
(Morning)
Lesson 7
(Morning)
Lesson 7
(Afternoon)
Lesson 8
(Morning and
Afternoon)
(Morning)
Lesson 6
(Afternoon)
Lesson 9
(Morning and
Afternoon)
Exam 2
9
Course Materials—Hardcopy Materials
• Student Guide
–
–
–
–
–
–
–
–
–
–
Name tent
Schedule
Gold Card
EVM 202 course CD
Learning objectives
LAR Vehicle scenario
Lesson slides
Lesson exercises
Comparison of Major Contract Types job aid
LAR Vehicle Program Control Book—DEC 2016
• Other classroom handouts
Bring your calculator or use your laptop’s calculator—
4 function is good enough.
Cell phone use is strictly prohibited.
EVM 202
November 2017
10
Lesson 1-10
Introductions
•
•
•
•
•
Name
Organization—Job and Location
How is Earned Value Management (EVM) used in youroffice?
How many years of EVM experience do you have?
What do you want to get out of this class?
11
EVM Review
• EVM 202 Pre-Course Self-Assessment
– Common challenges
– Questions
• Other EVM questions
12
EVM 202
November 2017
Lesson 1-11
Lesson 1—Introduction to EVM 202 and the
LAR Vehicle Program
Lesson 1 Learning Objectives
Terminal Learning Objective (TLO)
• Given a program scenario and accompanying documents,
construct a brief that summarizes key program information
Enabling Learning Objective (ELO)
• Given program documentation, describe program
requirements, risks, and constraints in order to use EVM
effectively
14
EVM 202
November 2017
Lesson 1-12
Let’s Get Started
•
Unmute your volume.
•
Open Blackboard and go to Lesson 1:
–
–
–
–
–
•
•
Go to https://myclass.dau.mil.
Select Click here to login and I Accept.
Login using either your common access card
(CAC) (select Login using Smart Card) or your
Blackboard username and password (select
Login using Username and Password).
Select EVM 202 under Course List on the My
Class Space page.
Select Lesson 1 from the Course Menu.
Review:
–
–
–
LAR Vehicle Scenario (Student Guide)
COL Paine Briefing (LAR Vehicle Overview)
Lesson 1 References
–
–
–
Download the Convince Briefing Template to your computer.
Complete each section of the Convince Briefing as a team.
Cite where you found your information for each section, e.g., Source: Capability
Development Document (CDD).
Upload your Final Convince Briefing to your team’s File Exchange.
Complete the Convince Briefing task.
–
15
Lesson 1 Summary
• Terminal Learning Objective (TLO)
– Given a program scenario and accompanying documents, construct a
brief that summarizes key program information
• Enabling Learning Objective (ELO)
– Given program documentation, describe program requirements, risks,
and constraints in order to use EVM effectively
16
EVM 202
November 2017
Lesson 1-13
How to Access Blackboard and Lesson 1
To access Blackboard and Lesson 1:
1. Go to https://myclass.dau.mil.
2. Select Click here to login on the Welcome to DAU Blackboard login screen.
3. Select I Accept in the DoD Warning Banner dialog box.
4. Login using either your common access card (CAC) (select Login using Smart Card) or
your Blackboard username and password (select Login using Username and
Password).
The Blackboard homepage displays.
5. Select EVM 202 under Course List on the My Class Space page.
The Blackboard EVM 202 course displays.
6. Select the Lesson 1 tab from the Course Menu on Blackboard.
Lesson 1 displays.
EVM 202
November 2017
Lesson 1-14
Exercise Instructions
Group Task: Convince Briefing
(Use the Convince Briefing Template on Blackboard for this exercise.)
When directed by the instructor, review the LAR Vehicle Program Overview by COL Paine on
Blackboard. Your task is to prepare and deliver a 10-minute briefing to COL Paine by creating,
completing, and saving your team’s Convince Briefing on Blackboard. The Convince Briefing will
include your team’s personal EVM experience and identify the LAR Vehicle key performance
parameters (KPPs), critical milestones, budget requirements, and associated risks.
Use your team’s File Exchange on Blackboard under Team Groups > Team [A/B/C/D] > File
Exchange to complete this exercise.
File Exchange Instructions
To complete your team’s Convince Briefing:
Select the Lesson 1 tab from the Course Menu on Blackboard.
Download the Convince Briefing Template under Task: Convince Briefing.
Save the file to your computer.
Complete each section of the Convince Briefing as a team.
Cite where you found your information for each section, e.g., Source: Capability
Development Document (CDD).
6. To share draft files with your team members:
a. Select the Team Groups tab on the Course Menu.
b. Select your team’s link under Groups.
c. Select File Exchange under Group Tools to upload and share files.
d. Select Add File to upload a file.
e. Select Browse My Computer to locate the file on your computer.
f. Enter a Name for your file in the Name field.
g. Select Submit to post the file to your team’s File Exchange.
7. Upload your Final Convince Briefing to your team’s File Exchange.
1.
2.
3.
4.
5.
 Note: Name your file “Final Convince Briefing” to distinguish it from any draft
documents in your team’s File Exchange.
EVM 202
November 2017
Lesson 1-15
EVM 202 Lesson 2:
EVM in the Acquisition Strategy
STUDENT GUIDE
CONTENTS
1.
2.
3.
4.
5.
6.
Learning Objectives and Additional References
LAR Vehicle Scenario
Presentation Slides
Exercise Instructions
Acquisition Strategy Practice Exercise
Comparison of Major Contract Types
EVM 202
November 2017
Lesson 2-1
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EVM 202
November 2017
Lesson 2-2
Learning Objectives and Additional References
Terminal Learning Objective
Apply Department of Defense (DoD) Earned Value Management (EVM) policy to assemble the EVM
elements of an acquisition strategy and pre-contract activities.
Enabling Learning Objectives
•
•
•
•
•
Demonstrate the EVM applicability to a contract
Identify Request for Proposals (RFP) sections affected by EVM application
Given MIL-STD-881 and a risk assessment, choose the appropriate Contract Work Breakdown
Structure (CWBS) level for EVM reporting
Distinguish between the EVM-related Defense Federal Acquisition Regulation Supplement
(DFARS) clauses
Apply appropriate Integrated Program Management Report (IPMR) tailoring
Additional References
•
•
•
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
Defense Cost and Resource Center (DCARC) website
Performance Assessments and Root Cause Analyses (PARCA) website
Earned Value Management System Interpretation Guide (EVMSIG)
EVM 202
November 2017
Lesson 2-3
LAR Vehicle Scenario
Background
It is early August 2015 and the Joint Capability Technology Demonstration (JCTD) for the Lightweight,
Assault and Reconnaissance (LAR) Vehicle continues testing. Your convince briefing was well received
last week by COL Paine and GEN Moatars. With their decision to include and use EVM to manage the
LAR Vehicle program, we can now complete the LAR Engineering and Manufacturing Development (EMD)
acquisition strategy.
With continuing tensions in the Middle East as well as other parts of the world, the LAR Vehicle program
has become a high priority for the Army. The Secretary of Defense has declared the LAR Vehicle program
an Acquisition Category I (ACAT I) program of the utmost importance.
Looking ahead, there are significant DoD budget pressures resulting from the war on terrorism. Across the
board funding cuts are possible over the next few years as Congress tries to balance the Federal budget.
The LAR Vehicle program is at risk of being canceled if cost, schedule, and technical problems are not
identified early and managed effectively.
Relevant Information
1. The EMD contract is estimated in the $600 to $800 million range. The target contract award date is
March 2016. Because of the program risk level, a cost plus type contract with a combination of
award and incentive fees is anticipated.
2. COL Paine is an EVM advocate. Although his background and experience are mostly technical, he
recognizes the benefits of using the earned value approach in program management. He feels that
even though the contractor is being paid to manage the effort, expending internal resources to
preclude problems makes good business sense.
3. The level of detail in EVM reporting should be based on scope, complexity, and risk. This
requirement is defined in the Integrated Program Management Report (IPMR) Data Item
Description (DID) DI-MGMT-81861 (current version) and the OSD (PARCA) letter Level of Detail
on Contract for Earned Value Reporting, dated June 18, 2015. The detail level for EVM reporting is
placed on the contract using a Contract Data Requirements List (CDRL) and the Cost and
Software Data Reporting/Earned Value Management (CSDR?EVM) CO-PLAN (if required)
referencing the IPMR. Furthermore, the IPMR DID states that the reporting level is defined through
tailoring the work breakdown structure (WBS) from the applicable MIL-STD-881 (current version)
appendix and does not prescribe a required level of detail. To support a March 2016 contract
award, the Request for Proposals (RFP) will need to be released in November 2015. The RFP will
need to include an IPMR CDRL that provides the contractor with the proposed WBS to be used for
IPMR data reporting in Format 1
EVM 202
November 2017
Lesson 2-4
September 2016
EVM 202—Lesson 2 EVM in the Acquisition Strategy
Lesson 2 Learning Objectives
Terminal Learning Objective
• Apply DoD Earned Value Management (EVM) policy to assemble
the EVM elements of an acquisition strategy and pre-contract
activities
Enabling Learning Objectives
• Demonstrate the EVM applicability to a contract
• Identify Request for Proposals (RFP) sections affected by EVM
application
• Given MIL-STD-881 and a risk assessment, choose the
appropriate Contract Work Breakdown Structure (CWBS) level for
EVM reporting
• Distinguish between the EVM-related Defense Federal Acquisition
Regulation Supplement (DFARS) clauses
• Apply appropriate Integrated Program Management Report
(IPMR) tailoring
2
EVM 202
November 2017
Lesson 2-5
What Is Earned Value Management (EVM)?
•
Program management tool that utilizes a contractor’s Earned Value
Management System (EVMS) to integrate the work scope, schedule,
and cost parameters of a program, providing objective performance
measurement and management
• As work is performed, the corresponding budget value is “earned” (EV)
Acronym
Term
Definition
EVM
Earned Value
Management
An integrated program management toolthe
program manager (PM) uses to track
specific contract cost, schedule and
performance objectives to support the
Acquisition Program Baseline (APB) goals
EVMS
Earned Value
Management System
The contractor-specific internal control
system(s) used to meet EVM requirements
EV
Earned Value
The value of completed work expressed in
terms of the work’s assigned budget, or
budgeted cost for work performed (BCWP)
3
Earned Value Management System (EVMS)
4
EVM 202
November 2017
Lesson 2-6
Earned Value Management Gold Card
5
Powerful Quantitative Reports
6
EVM 202
November 2017
Lesson 2-7
EVM within the Contracting Process
7
Statutes Related to EVM
Law
Purpose
Government Performance and
Results Act of 1993 (GPRA)
Requires strategic planning and
performance standards for Federal
Government
Federal Acquisition Streamlining Act
of 1994—Title V (FASA V)
Requires programs to achieve 90% of
cost, schedule, and performance goals
Information Technology
Management Reform Act of 1996
(ITMRA/Clinger-Cohen)
Requires executive agencies to report
performance of information system
acquisitions
Weapon System Acquisition Reform
Act of 2009 (WSARA)
Requires DoD to describe current EVM
implementation and recommend policy
changes
8
EVM 202
November 2017
Lesson 2-8
Office of Management and Budget (OMB)
EVM Policy
Policy Guidance
• OMB Circular A-11 Supplement—Capital
Programming Guide
Purpose
• Unified guidance to support OMB reporting to
Congress
Circular A-11 Policy
• Agencies must establish cost, schedule, and
performance goals for major acquisitions and
achieve on average 90% of those goals
• Provides guidance on integration of EVM, Integrated
Baseline Reviews (IBRs), and risk management
• As an OMB Circular, applies to DoD and all
executive branch agencies
9
Integrated Program Management Report
(IPMR)
Format 1: Work Breakdown Structure
The level of detail to be reported normally will be at level
three of the Contract Work Breakdown Structure (CWBS),
but lower levels may be specified for high-cost or high-risk
items. CWBS elements and levels reported shall be those
specified in the contract.
Format 2: Organizational Categories
This format shall be used to collect organizational cost
information at the total contract level for organizational
elements that reflect the contractor's internal
management, rather than for individual CWBS elements
structure. Format 2 shall also identify each major
subcontractor as defined in the contract.
Format 3: Baseline
Format 3 lists all significant baseline changes that have
occurred by CWBS during the reporting period, to include
the contract changes and supplemental agreements,
allocations from management reserve (MR) and
undistributed budget (UB), and any significant re-phasing
of budgets.
Format 4: Staffing
Format 4 includes staffing forecasts in months by the
organizational categories. Format 4 categories may differ
from those reported in Format 2 and shall be addressed
during negotiations.
Format 5: Explanations and Problem Analyses
Format 5 is a narrative report prepared to amplify and
explain data in the other IPMR formats.
Format 6: Integrated Master Schedule
Format 6 defines and contains the contractor’s IMS. It
integrates with Format 1 WBS, Format 2 OBS, Format 3
Baseline, and Format 5 Analysis. Format 6 contains both the
baseline and forecast schedules, and predicts the contract
completion date and all interim milestones.
Format 7: Electronic History and Forecast File
Format 7 provides supplemental historical and time-phased
information. Format 7 shall normally address the following:
monthly historical time-phased budgeted cost for work
scheduled (BCWS), BCWP, actual cost of work performed
(ACWP), estimate to complete (ETC), by control account
(CA) WBS; future forecast of BCWS and ETC.
10
EVM 202
November 2017
Lesson 2-9
DoDI 5000.02 EVM Application Requirements
Enclosure 1 Table 8
Table 8 summarizes EVM application requirements. EVM is applied to cost reimbursable or incentive contracts,
inclusive of options, with 18 months or greater period of performance and based on the nature of the work
scope.
Contract Value
< $20M
≥ $20M & < $100M
≥ $100M
Applicability
Notes
Source
EVM not required; may be
applied at PM discretion
Requires business case analysis and MDA
approval
based on risk to the
Government
EVM Required; contractor is
required to have an EVM
The Government reserves the right to review a
system (EVMS) that
contractor’s EVMS when deemed necessary to
complies with the guidelines verify compliance
in EIA-748*
Part 7 of OMB Circular
A-11 (Reference (c));
DFARS 234.201
(Reference (al)); This
The Contractor will provide access to all pertinent instruction
EVM Required; contractor is records and data requested by the Contracting
required to have an EVMS Officer or duly authorized representative as
that has been determined to necessary to permit initial and ongoing
be in compliance with the
Government compliance reviews to ensure that
guidelines in EIA-748*
the EVMS complies, and continues to comply,
with the guidelines in EIA-748*.
Additional Information
For ACAT ID and IAM programs, OSD USD(AT&L) Performance Assessments and Root Cause Analyses (PARCA), in
coordination with the CAE or designee, will review proposed contract work scope for EVM applicability and provide a
recommendation to the DAE/MDA for a determination of EVM applicability. For all other ACAT levels, the CAE, or designee, will
review and determine EVM applicability. If EVM is determined to apply, then threshold application in this table is utilized or a
waiver from the CAE is required. If, based on the nature of the work, EVM is determined not to apply, then EVM is not placed on
contract.
Applying EVM outside the thresholdsand criteria above, to include application on firm, fixed-price (FFP) contracts, FFP task
orders, or FFPdelivery orders, a cost-benefit analysis will be conducted, MDAapproval is required, and the results provided to the
contracting officer for documentation in the contract file.
The term "contracts” includes contracts, subcontracts, intra-government work agreements, and other agreements.
For indefinite delivery, indefinite quantity (IDIQ) contracts, inclusion of EVM requirements isbased on the estimated ceiling of
the total IDIQ contract, and then is applied to the individual task/delivery orders, or group(s) of related task/delivery orders, that
meet or are expected to meet the conditions of contract type, value, duration, and work scope. The EVM requirements should be
placed on the base IDIQ contract and applied to the task/delivery orders, or group(s) of related task/delivery orders. “Related”
refers to dependent efforts that can be measured and scheduled across task/delivery orders.
The Integrated Baseline Review is required when EVM is determined to be applicable.
The initiation of an over-target baseline or over-target schedule must be approved by the Government program manager.
Application thresholds are in then-year dollars.
* EIA-748 = Electronic Industries Alliance (EIA) 748-C (Reference (au))
1
DoDI 5000.02 EVM Policy Guidance
Enclosure 1 Table 9 EVM Reporting Requirements
Contract Value
Applicability
< $20M
Not required
≥ $20M & < $50M
Required monthly when EVM
requirement is on contract
≥ $50M
Required monthly when EVM
requirement is on contract
Notes
Source
IPMR Should be used if cost and/or
schedule reporting is requested by the
PMO
Formats 2, 3, and 4 may be excluded from
the contract data requirements list (CDRL) IPMR DID DI-MGMT-81861A*
at program manager discretion based on
risk
All Formats must be included in the CDRL
Additional Information
For ACAT I contracts, task orders, and delivery orders, IPMR data will be delivered to the EVM Central Repository.
The IPMR can be tailored to collect cost and/or schedule data for any contract regardless of whether EVM is required. For
information on tailoring the IPMR, refer to the DoD IPMR Implementation Guide (Reference (cj)).
Formats and reporting requirements for the IPMR are determined and managed by USD(AT&L) through the office of PARCA.
Reporting thresholds are in then-year dollars.
DI-MGMT-81861A = Data Item Management-81861 (Reference (av))
12
EVM 202
November 2017
Lesson 2-10
DoDI 5000.02 EVM Applicability - PMO 2 Step
EVM Application Process
Step 1. PMO Determination ‐ Contract Criteria Review
1. Contract is Cost Plus or Incentive
2. Contract > $20M (including known
options)
3. Contract at least 18 months PoP
4. Work discreetly measurable &
schedulable
all Yes
1 or 2 or 3 is No
EVM Not Applicable*
only 4 is No
Must move to Step 2 for
work scope determination
No
EVM does not apply* EVM
not on contract; no
deviation/waiver required
Step 2. Work Scope Determination
• Does EVM apply based on review of
SOW, PWS, WBS, & CDRLs (i.e., work
discretely measurable & schedulable)
 ACAT ID & IAM – PARCA Determines
 Other ACATs ‐ SAE/CAE Determines
•
EVM placed on contract;
PMO has option to seek
waiver/deviation from CAE
Yes
EVM does apply EVM is
placed on contract; PMO
has option to seek
waiver/deviation from CAE
The PM has the option to make a business case to apply EVM outside the thresholds and application decision
Key EVM Inputs in the RFP Development
Process
• Do you include EVM at all?
• Where do you address EVM in the RFP?
–
–
–
–
–
Section C—Description/Specs/Work Statement
Section I—General Provisions
Section J—Exhibits/Attachments
Section L—Instructions to Offerors
Section M—Evaluation Factors for Award
14
EVM 202
November 2017
Lesson 2-11
Section C—Statement of Objectives (SOO)
or Statement of Work (SOW)
• The SOO or SOW should contain statements requiring:
– Development of a CWBS at a level adequate for management and
contract control
– The contracted technical effort to use a guidelines-compliant
EVMS that correlates cost and schedule performance with
technical progress
– Designation of critical subcontractors by name for EVM compliance
and flow down of EVMS compliance to subcontractors
– Integrated Baseline Reviews (IBRs)
– Reference to EVMS data items as part of Integrated Program
Management Reporting
See the Application of EVM to Contracts job aid for
sample SOW paragraphs
15
Section I—General Provisions
•
•
Use the DFARS clauses, not the FAR clauses, for EVM.
FAR Clauses
– FAR 52.234-2 Notice of EVMS—Pre-Award IBR (July 2006)
– FAR 52.234-3 Notice of EVMS—Post Award IBR (July 2006)
– FAR 52.234-4 EVMS—The Government will conduct an IBR if a pre-award IBR
has not been conducted. (May 2014)
•
DFARS Section 234.203—Solicitation provisions and contract clause
(Dec 2011)
– Use the provision at DFARS 252.234-7001, Notice of Earned Value
Management System, in the solicitation instead of the provisions at FAR
52.234-2 and FAR 52.234-3.
– Use the clause at DFARS 252.234-7002, Earned Value Management System,
in the solicitation and contract instead of the clause at FAR 52.234-4.
– Use DFARS 252.242-7005, Contractor Business Systems, in the solicitation
and contract to allow for withholding payments due to a non-compliant EVMS
issue.
– Includes links to procedures on performing cost-benefit analyses and waivers
DoD contracts will not use FAR clauses for EVM.
EVM 202
November 2017
16
Lesson 2-12
Section J—Exhibits/Attachments
• Contract Data Requirements List (CDRL) places data on contract
– EVM-Related Data Item Descriptions (DID)
• Integrated Program Management Report (IPMR)—DI-MGMT-81861 (current
version) supersedes CPR and IMS DIDs, effective July 1, 2012
• EVM CDRLs can and should be tailored within bounds of policy
– Tailoring options are limited for contracts ≥ $50M (frequency, level of detail)
– Most aspects are tailorable for contracts < $50M (formats, frequency, level of detail, etc.)
– FM and Cost-Related Data Item Descriptions (DIDs)
• Contract Work Breakdown Structure—DI-MGMT-81334D
• Contract Funds Status Report—DI-MGMT-81468A
• Consider all risk factors when tailoring EVM DIDs
–
–
–
–
–
Type of contract (determined by cost risk)
Technology
Schedule
Past contractor performance
Scope, complexity, risk
17
EVM Central Repository
•
•
•
Provides centralized reporting, collection, and distribution of the Contract
Performance Reports (CPRs), Contract Funds Status Report (CFSR), the
Integrated Master Schedule (IMS), and the IPMR
Mandatory for ACAT 1C, 1D (Major Defense Acquisition Program (MDAP)),
and ACAT 1A (Major Automated Information System (MAIS)) programs
Available at the EVM Central Repository (EVM-CR) at
http://dcarc.cape.osd.mil/evm/evmoverview.aspx
18
EVM 202
November 2017
Lesson 2-13
Section J—EVM Report Details Required
• Formats 1-5 Guidance
• Format 6 Guidance
–
–
–
–
–
Formats 1 and 2 reporting levels
Reporting frequency
Submission dates
Date of first and last reports
Resources shown in dollars or
hours
– Format 5 variance reporting
•
thresholds
• Fixed number of variances
• Percentage or dollar thresholds
• Specific variances
– Human readable format
–
–
–
–
Reporting frequency
Submission dates
Date of first and last reports
Frequency of schedule risk
analysis
– Electronic data interchange format
Format 7 Guidance
–
–
–
–
–
Reporting levels
Subcontractor information
Date elements
Reporting frequency
DoD-approved electronic XML
format
19
Section L—Instructions to Offerors
• Guidance to bidders for the assembly of their proposals
• Each offeror’s proposal shall include a description of the EVMS
to be used in accordance with the appropriate RFP DFARS
clauses
• Compliance with system approval requires:
– Reference to a “Proof of System Approval” (e.g., Contracting Officer
Final Determination (COFD) Letter and a copy of the approved EVMS
description); or
– A plan to obtain EVMS approval to include how the system will be
approved
• Compliance only requires a written summary of the proposed
EVMS reference in sufficient detail to show how it addresses
all 32 EIA-748 EVMS guidelines
20
EVM 202
November 2017
Lesson 2-14
Section M—Evaluation Factors for Award
• Evaluation of the proposed EVMS is normally undertaken as
part of the proposal evaluation process to determine the
probability of the system meeting the guidelines
– For Existing Systems—Evaluation may consist of a confirmation that
the referenced system approval is accurate and current. The system
should be in use currently, and surveillance should not have identified
significant, uncorrected problems.
– For EVMS (Without approval)—The EVMS description should be
evaluated for completeness against the EIA-748 guidelines
• An on-site examination of a proposed EVMS should not
normally be required during proposal evaluation. But if
deficiencies are identified, written communications or an onsite visit may be required when approved by the Source
Selection Board and Procuring Activity
• The Defense Contract Management Agency (DCMA) should
be requested to provide insight regarding EVMS capability,
quality, and past performance
21
DoDI 5000.02 EVM Policy for Cost and
Incentive Contracts < $20M TY
• EVM optional; based on risk assessment
• Requires business case analysis and MDA approval
• DFARS clauses—If you decide to use EVM, use these DFARS
clauses:
– DFARS 252.234-7001—Notice of EVMS
– DFARS 252.234-7002—EVMS
– DFARS 252.242-7005—Contractor Business Systems
• EVM Data Requirements
– DI-MGMT-81861 (current version)—IPMR (Formats 1 and 5
recommended; Format 6 may be recommended)
• IBR conducted ASAP but not later than 180 calendar days after
contract award
22
EVM 202
November 2017
Lesson 2-15
DoDI 5000.02 EVM Policy for Cost and
Incentive Contracts ≥ $20M TY and
< $50M TY
• Comply with EIA-748
• No formal EVMS approval
• DFARS clauses
– DFARS 252.234-7001—Notice of EVMS
– DFARS 252.234-7002—EVMS
– DFARS 252.242-7005—Contractor Business Systems
• EVM Data Requirements
– DI-MGMT-81861 (current version)—IPMR (Formats 1, 5, 6, and 7 are
mandatory)
• IBR conducted ASAP but not later than 180 calendar days after
contract award
23
DoDI 5000.02 EVM Policy for Cost and
Incentive Contracts ≥ $50M TY and
< $100M TY
• Comply with EIA-748
• No formal EVMS approval
• DFARS clauses
– DFARS 252.234-7001—Notice of EVMS
– DFARS 252.234-7002—EVMS
– DFARS 252.242-7005—Contractor Business Systems
• EVM Data Requirements
– DI-MGMT-81861 (current version)—IPMR (All seven formats are
mandatory)
• IBR conducted ASAP but not later than 180 calendar days
after contract award
24
EVM 202
November 2017
Lesson 2-16
DoDI 5000.02 EVM Policy for Cost and
Incentive Contracts ≥ $100M TY
• Comply with EIA-748
• EVMS formally approved by cognizant contracting officer
• DFARS clauses
– DFARS 252.234-7001—Notice of EVMS
– DFARS 252.234-7002—EVMS
– DFARS 252.242-7005—Contractor Business Systems
• EVM Data Requirements
– DI-MGMT-81861 (current version)—IPMR (All seven formats
mandatory)
• IBR conducted as soon as possible (ASAP) but not later than
180 calendar days after contract award
25
DoDI 5000.02 EVM Policy for Firm-FixedPrice (FFP) Contracts
• EVM discouraged regardless of dollar value
• Requires Milestone Decision Authority (MDA) approval and
cost-benefit analysis
• If MDA decides to implement EVM, need same EVM DFARS
clauses
• EVM Data Requirements
– DI-MGMT-81861 (current version)—IPMR
• Formats 1 and 2—Performance in hours (versus dollars) or reported at
price rather than cost
• Format 3—Optional
• Format 4—Not recommended
• Format 5—If concerned with schedule risk, focus on schedule variance;
rely on IMS variance analysis
• Format 6—IMS. Consider alternatives: Contractor internal reports, status
meetings, or use line of balance schedule
• Format 7—Not recommended
• IBR conducted ASAP but not later than 180 calendar days after
contract award
26
EVM 202
November 2017
Lesson 2-17
IPMR Co-Plan EXERCISE
27
Acquisition Strategy Practice Exercise
• Is Earned Value Management (EVM) required? (Yes or No)
• Is EVMS approval required? (Yes or No)
• Which EVM DFARS contract clause(s) and number(s) should
be used in the Request for Proposals (RFP)?
• Which EVM Data Item Description (DID) number(s) should be
used in the RFP?
• What formats of the EVM DID (if any) would you tailor out with
the Contract Data Requirements List (CDRL)?
Independent Scenarios
28
EVM 202
November 2017
Lesson 2-18
ACQUISITION STRATEGY PRACTICE
EXERCISE REVIEW
Practice Exercise: Scenario 1
Your Integrated Product Team (IPT) is responsible for developing
the encryption hardware and encryption software for a new
satellite system. The acquisition strategy is based on a complex
modification of an existing aircraft system.
Risk Assessment
• Technical risk—High
• Schedule risk—High
• Cost risk—Low
Contract Details
• Contract Type: Cost Plus Incentive Fee/Award Fee
• Period of Performance: 36 months
• Estimated RDT&E Cost: $80M (TY)
30
EVM 202
November 2017
Lesson 2-19
Practice Exercise: Scenario 2
You are preparing a Concept Exploration RFP. In source
selection, you plan to award at least three eighteen month, cost
plus award fee study contracts.
Contract Details
• Contract Type: Cost Plus Award Fee
• Period of Performance: 18 months
• Estimated RDT&E: $30M (for all three) (TY)
31
Practice Exercise: Scenario 3
Your IPT is responsible for the development of simulation
software. The software will be used for System Qualification
Testing, Developmental Test and Evaluation (DT&E), and
Operational Test and Evaluation (OT&E) of a major weapon
system. The software will be provided as Government furnished
property (GFP) to the primary contractor as well as the DT and
OT testers. Although this is new software to the Government,
most of the modules are game simulations considered
commercial-off-the-shelf (COTS).
Contract Details
• Contract Type: Firm-Fixed-Price (FFP)
• Period of Performance: 18 months
– Provides six-month schedule padding before GFP need date
• Estimated RDT&E Cost: $20.5M (TY)
32
EVM 202
November 2017
Lesson 2-20
Practice Exercise: Scenario 4
Your IPT is responsible for developing an RFP for an ACAT-3 target
rocket Low Rate Initial Production (LRIP) contract. The Cost Plus
Award Fee (CPAF) Engineering and Manufacturing Development
(EMD) contract is experiencing an 8 to 12 percent cost growth and is
about six to eight months behind schedule, and a number of technical
issues have been identified in DT&E. A two year LRIP has been
approved while Initial OT&E (IOT&E) testing continues instead of full
rate production. The LRIP contract will be a new contract with both
Research Development Test and Evaluation (RDT&E) test items and
Production line items.
Contract Details
• Contract Type: Fixed Price Incentive Firm Target
• Period of Performance: 30 Months
• Estimated RDT&E: $25M ($10M TY1 and $15M TY2)
• Estimated Production: $80M (TY2)
33
Practice Exercise: Scenario 5
You are the leader of a proposal development team preparing an
RFP to outsource the depot maintenance for a major weapon
system. The depot work is dependent on the Government getting
the system to the depot as scheduled. The contract will include a
base year and five annual options. The Statement of Work (SOW)
has two primary tasks:
• Operate depot facilities—a level of effort (LOE) task
• Repair, upgrade, and test hardware on a time-and-materials
(T&M) task order basis.
Contract Details
• Contract Type: Cost Plus Award Fee
• Period of Performance: 72 months
• Estimated O&M Costs: $500M (TY)
34
EVM 202
November 2017
Lesson 2-21
Lesson 2 Summary
• Terminal Learning Objective (TLO)
– Apply DoD EVM policy to assemble the EVM elements of an
acquisition strategy and pre-contract activities
• Enabling Learning Objective (ELO)
– Demonstrate the EVM applicability to a contract
– Identify RFP sections affected by EVM application
– Given MIL-STD-881 and a risk assessment, choose the appropriate
CWBS level for EVM reporting
– Distinguish between the EVM-related DFARS clauses
– Apply appropriate IPMR tailoring
35
EVM 202
November 2017
Lesson 2-22
Lesson 2 Exercise Instructions
Individual Tasks
Before starting the group task listed below, each team member should:
1. Review the Acquisition Community Connection EVM Community of Practice at the following URL:
https://www.dau.mil/cop/evm/Pages/Default.aspx
2. View the LAR Vehicle Request for Proposal (RFP) Task Briefing (Mr. Nuisance) and LAR Vehicle Risk
Assessment Briefing (Ms. Goodwrench) videos available on Blackboard.
Group Task:
Cost and Software Data Reporting (CSDR)/Earned Value Management Co-Plan exercise.
This exercise identifies the Contract Work Breakdown Structure (CWBS) used for EVM and CSDR reporting by
way of a Co-Plan, which is required for all ACAT 1 programs. The Co-Plan will be included with the Contract
Data Requirements List in the RFP and will identify the CWBS elements required for EVM reporting to the
Government in Format 1 of the IPMR. As such, the CWBS must extend at least as far as you intend to get
EVM reporting.
1. Open the draft of the Co-Plan, which is an Excel file.
2. You should be able to complete the exercise by reviewing the following:
a. The risk assessment provided by Ms. Goodwrench
b. MIL-STD-881, Appendix G
c. The draft Statement of Work (SOW) in the RFP
3. Ensure the Co-Plan follows the level of detail in the SOW (i.e. – if the SOW has items listed at a lower level
of indenture than on the Co-Plan, insert rows in the Co-Plan and WBS numbers as appropriate -- Hint: see
CWBS # 1.1.2).
4. Also, add rows and CWBS numbers for items you would like additional insight into; these typically are highrisk items and may be at a lower level than provided in MIL-STD-881 (level 4 for purposes of this exercise).
5. Place an X in box 13h (IPMR Format 1) in all rows that correspond to a CWBS item that you want the
contractor to furnish EVM data in Format 1.
6. Do not place an X for items not in SOW.
EVM 202
November 2017
Lesson 2-23
Acquisition Strategy Practice Exercise
Review the following five scenarios and answer the following questions using current EVM
policy:
1. Is Earned Value Management (EVM) required? (Yes or No)
2. Is Earned Value Management System (EVMS) approval required? (Yes or No)
3. Which EVM DFARS contract clause(s) and number(s) should be used in the Request for
Proposals (RFP)?
4. Which EVM Data Item Description (DID) number(s) should be used in the RFP?
5. What formats of the EVM DID (if any) would you tailor out with the Contract Data
Requirements List (CDRL)?
Scenario 1
Your Integrated Product Team (IPT) is responsible for developing the encryption hardware and
encryption software for a new satellite system. The acquisition strategy is based on a complex
modification of an existing aircraft system.
Technical Risk: HIGH
Schedule Risk: HIGH
Cost Risk: LOW
Contract Type: Cost Plus Incentive Fee/Award Fee
Period of Performance: 36 months
Estimated Research, Development, Test, and Evaluation (RDT&E) Cost: $80M (TY)
EVM Required
EVMS Approval Required
EVM DFARS Clauses and Number(s)
EVM DID Number(s)
DID Format(s) to be tailored out in CDRL
EVM 202
November 2017
Lesson 2-24
Scenario 2
You are preparing a Concept Exploration RFP. In source selection, you plan to award at least
three eighteen month, cost plus award fee study contracts.
Contract Type: Cost Plus Award Fee
Period of Performance: 18 months
Estimated RDT&E: $30M (for all three) (TY)
EVM Required
EVMS Approval Required
EVM DFARS Clauses and Number(s)
EVM DID Number(s)
DID Format(s) to be tailored out in CDRL
Scenario 3
Your IPT is responsible for the development of simulation software. The software will be used
for System Qualification Testing, Developmental Test and Evaluation (DT&E) and Operational
Test and Evaluation (OT&E) of a major weapon system. The software will be provided as
Government-furnished property (GFP) to the primary contractor as well as the DT & OT testers.
Although this is new software to the Government, most of the modules are game simulations
considered commercial-off-the-shelf (COTS).
Contract Type: Firm-Fixed-Price
Period of Performance: 18 months (provides six-month schedule padding before GFP
need date)
Estimated RDT&E Cost: $20.5M (TY)
EVM Required
EVMS Approval Required
EVM DFARS Clauses and Number(s)
EVM DID Number(s)
DID Format(s) to be tailored out in CDRL
EVM 202
November 2017
Lesson 2-25
Scenario 4
Your IPT is responsible for developing an RFP for an ACAT-3 target rocket Low-Rate Initial
Production (LRIP) contract. The CPAF EMD contract is experiencing an eight to twelve percent
cost growth and is about six to eight months behind schedule, and a number of technical issues
have been identified in DT&E. A two year LRIP has been approved while Initial Operational Test
and Evaluation (IOT&E) testing continues instead of full rate production. The LRIP contract will
be a new contract with both RDT&E test items and production line items.
Contract Type: Fixed Price Incentive Firm Target
Period of Performance: 30 Months
Estimated RDT&E: $25M ($10M TY1, & $15M TY2)
Estimated Production: $80M (TY2)
EVM Required
EVMS Approval Required
EVM DFARS Clauses and Number(s)
EVM Data Item Description Number(s)
DID Format(s) to be tailored out in CDRL
EVM 202
November 2017
Lesson 2-26
Scenario 5
You are the leader of a proposal development team preparing an RFP to outsource the depot
maintenance for a major weapon system. The contract will include a base year and five annual
options. The SOW has two primary tasks: 1) operate depot facilities, a level of effort (LOE) task;
and 2) repair, upgrade, and test hardware on a time-and-materials (T&M) task order basis.
Contract Type: Cost Plus Award Fee
Period of Performance: 72 months
Estimated O&M Costs: $500M (TY)
EVM Required
EVMS Approval Required
EVM DFARS Clauses and Number(s)
EVM Data Item Description Number(s)
DID Format(s) to be tailored out in CDRL
EVM 202
November 2017
Lesson 2-27
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EVM 202
November 2017
Lesson 2-28
Comparison of Major Contract Types
Firm-Fixed-Price
(FFP)
1
2
Fixed Price
Economic Price Adjustment
(FPEPA)
Fixed Price
Incentive Firm Target
(FPIF)
Fixed Price
Award Fee
(FPAF)
Fixed Price Prospective
Price Redetermination
(FP3R)
Principal Risk None. Thus, the contractor
to be Mitigated assumes all cost risk.
Unstable market prices for
labor or material over the life
of the contract.
Moderately uncertain
contract labor or material
requirements.
Risk that the user will not be
fully satisfied because of
judgmental acceptance criteria.
Costs of performance after the
first year because they cannot
be estimated with confidence.
Use When…
The requirement is well-defined.
Contractors are
experienced in meeting it.
Market conditions are
stable.
Financial risks are
otherwise insignificant.
The market prices at risk are
severable and significant. The
risk stems from industry-wide
contingencies beyond the
contractor's control. The
dollars at risk outweigh the
administrative burdens of an
FPEPA.
A ceiling price can be
established that covers the
most probable risks inherent
in the nature of the work. The
proposed profit sharing
formula would motivate the
contractor to control costs and
to meet other objectives.
Judgmental standards can be
fairly applied by the fee
determining official. The
potential fee is large enough to
both:
• Provide a meaningful
incentive.1
• Justify related
administrative burdens.
The Government needs a firm
commitment from the contractor
to deliver the supplies or
services during subsequent
years. The dollars at risk
outweigh the administrative
burdens of an FPRP.
Elements
A firm-fixed-price for each line
item or one or more groupings
of line items.
A fixed-price, ceiling on
upward adjustment, and a
formula for adjusting the price
up or down based on:
• Established prices
• Actual labor or material
costs
• Labor or material
indices
• Ceiling price
• Target cost
• Target profit
• Delivery, quality, or
other performance
targets (optional)
• Profit sharing formula
• 120 % ceiling and
50/50 share are points
of departure
• Fixed-price.
• Award amount
• Award fee evaluation
criteria and procedures
for measuring
performance against the
criteria
• Fixed-price for the first
period.
• Proposed subsequent
periods (at least 12
months apart).
• Timetable for pricing the
next period(s).
Contractor is
Obliged to:
Provide an acceptable
deliverable at the time, place
and price specified in the
contract.
Provide an acceptable
deliverable at the time and
place specified in the contract
at the adjusted price.
Provide an acceptable
deliverable at the time and
place specified in the contract
at or below the ceiling price.
Perform at the time, place, and
the price fixed in the contract.
Provide acceptable deliverables
at the time and place specified
in the contract at the price
established for each period.
Contractor
Incentive
(other than
maximizing
goodwill)1
Generally realizes an additional
dollar of profit for every dollar
that costs are reduced.
Generally realizes an
additional dollar of profit for
every dollar that costs are
reduced.
Realizes profit on cost by
completing work below the
ceiling price. May earn higher
profit by incurring costs below
the target cost or by meeting
objective performance targets.
Generally realizes an additional
dollar of profit for every dollar
that costs are reduced; earns an
additional fee for satisfying the
performance standards.
For the period of performance,
realizes an additional dollar of
profit for every dollar that costs
are reduced.
Typical
Application
Commercial supplies and
services.
Long-term contracts for
commercial supplies during a
period of high inflation.
Production of a major system
based on a prototype.
Performance-based contracts.
Long-term production of spare
parts for a major system.
Principal
Limitations in
FAR/DFARS
Parts 16, 32,
35, and 522
Generally NOT appropriate for
R&D.
Must be justified.
Must be justified. Must be
negotiated. Contractor must
have an adequate accounting
system. Cost data must
support targets.
Must be negotiated.
MUST be negotiated. Contractor
must have an adequate
accounting system that supports
the pricing periods. Prompt
redeterminations.
Variants
Firm-Fixed-Price Level-of-Effort.
Successive Targets (FPIS)
Goodwill is the value of the name, reputation, location, and intangible assets of the firm.
Comply with any USD(A&S), DPAP or other memoranda that have not been incorporated into the DFARS or DoD Directives or Instructions.
Retroactive Redetermination
DSMC JANUARY 2014
Comparison of Major Contract Types
Cost Plus Incentive Fee
(CPIF)
Cost Plus Award Fee
(CPAF)
Cost Plus Fixed Fee
(CPFF)
Cost or Cost-Sharing
(C or CS)
Time-and-Materials
(T&M)
Principal Risk to be Highly uncertain and speculative labor hours, labor mix, and/or material requirements (and other things) necessary to perform the contract. The Government
Mitigated
assumes the risks inherent in the contract, benefiting if the actual cost is lower than the expected cost, or losing if the work cannot be completed within the
expected cost of performance.
Use When…
An objective relationship can
be established between the
fee and such measures of
performance as actual costs,
delivery dates, performance
benchmarks, and the like.
Objective incentive targets are
not feasible for critical aspects
of performance. Judgmental
standards can be fairly
applied. Potential fee would
provide a meaningful
incentive.
Relating fee to performance
(e.g., to actual costs) would
be unworkable or of
marginal utility.
The contractor expects
substantial compensating
benefits for absorbing part of
the costs and/or foregoing fee
or the vendor is a non-profit
entity.
No other type of contract is
suitable (e.g., because costs are
too low to justify an audit of the
contractor's indirect expenses).
Elements
• Target cost
• A minimum, maximum,
and target fee
• A formula for adjusting
fee based on actual
costs and/or
performance
• Performance targets
(optional)
• Target cost
• Base amount, if
applicable, and an
award amount
• Award fee evaluation
criteria and procedures
for measuring
performance against
the criteria
• Target cost
• Fixed fee
• Target cost
• No fee
• If CS, an agreement on
the Government's share
of the cost.
• Ceiling price
• A per-hour labor rate that
also covers overhead and
profit
• Provisions for reimbursing
direct material costs
Contractor is
Obliged to:
Make a good faith effort to meet the Government's needs within the estimated cost in the Contract, Part I the Schedule,
Section B Supplies or services and prices/costs.
Contractor
Incentive (other
than maximizing
goodwill)1
Realizes a higher fee by
completing the work at a
lower cost and/or by meeting
other objective performance
targets.
Realizes a higher fee by
meeting judgmental
performance standards.
Realizes a higher rate of
return (i.e., fee divided by
total cost) as total cost
decreases.
If CS, shares in the cost of
providing a deliverable of
mutual benefit.
Typical Application
Research and development
of the prototype for a major
system.
Large scale research study.
Research study.
Joint research with
educational institutions.
Principal
Limitations in
FAR/DFARS Parts
16, 32, 35, and 522
The contractor must have an adequate accounting system. The Government must exercise surveillance during performance
to ensure use of efficient methods and cost controls. Must be negotiated. Must be justified. Statutory and regulatory limits on
the fees that may be negotiated. Must include the applicable Limitation of Cost clause at FAR 52.232-20 through 23.
Variants
1
2
Completion or Term.
Goodwill is the value of the name, reputation, location, and intangible assets of the firm.
Comply with any USD(A&S), DPAP or other memoranda that have not been incorporated into the DFARS or DoD Directives or Instructions.
Make a good faith effort to meet
the Government's needs within
the ceiling price.
Emergency repairs to heating
plants and aircraft engines.
D&F required (w/ HCA if over 3
years). Government MUST
exercise appropriate surveillance
to ensure efficient performance.
Document any ceiling increases.
Labor Hour (LH)
DSMC JANUARY 2014
EVM 202 Lesson 3:
EVMS Guidelines and
Compliance
STUDENT GUIDE
CONTENTS
1. Learning Objectives and Additional References
2. LAR Vehicle Scenario
3. Presentation Slides
EVM 202
November 2017
Lesson 3-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 3-2
Learning Objectives and Additional References
Terminal Learning Objective
Explain the importance of the formal Earned Value Management System (EVMS) approval
process.
Enabling Learning Objectives
•
•
Explain the intent of the 32 Electronic Industries Alliance-748 (EIA-748) EVMS
guidelines
Describe the DoD EVMS compliance review (CR) process
Additional References
•
•
•
•
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) Earned Value Management (EVM)
Community of Practice (CoP)
Earned Value Management System Interpretation Guide (EVMSIG)
EIA-748 Intent Guide
DCMA-INST-208 Earned Value Management System Compliance Reviews, 9 Apr 2014
Department of Defense Earned Value Management Roles and Responsibilities, 03 Jul
2007
EVM 202
November 2017
Lesson 3-3
LAR Vehicle Scenario
Background
Ten months have passed, and it is now June 15, 2016. The Lightweight, Assault and
Reconnaissance (LAR) Vehicle program Milestone B was completed as scheduled in March
2016. Support to the allied force in the Middle East is going well.
The LAR Vehicle Engineering and Manufacturing Development (EMD) contract was awarded to
Increda Corporation three months late on June 1, 2016. This three-month slip resulted from a
contract protest from the ATPI Corporation. The June 1, 2016 award just met the LAR
Acquisition Program Baseline (APB) threshold date for contract award.
Increda was reluctant to provide the amount of Earned Value Management (EVM) reporting
contractually required. But in a true Integrated Product Team (IPT) spirit, COL Paine and
Increda were able to tailor the requirements to meet their mutual management needs. Before
you begin working the Memorandum of Agreement (MOA) with the Defense Contract
Management Agency (DCMA), COL Paine has asked you to review the Increda EVMS
description and identify potential issues for DCMA reconciliation.
Relevant Information
Your team knows that an Integrated Baseline Review (IBR) needs to be done within the first six
months of the contract and has started the planning process. The LAR Vehicle contract
established August 18, 2016 as the date for the IBR. This date has not been updated despite
the fact the Government awarded the contract three months late. However, before the IBR, you
want to make sure that there are no significant management risks associated with Increda’s
EVMS description that may cause a different review decision.
Since this is the first major Government contract for Increda, a formal compliance review (CR)
will be required. There is a potential that one of their subcontracts may exceed $20 million,
requiring Increda to affirm that the subcontractor management processes are compliant with the
32 EIA-748 guidelines. Based on that possibility, our IPT needs to review the EIA-748
guidelines and the EVMS approval process to determine if EVM flow-down and approval to/for
subcontractors will be required once all the subcontracts are awarded.
EVM 202
November 2017
Lesson 3-4
September 2016
EVM 202—Lesson 3 EVMS Guidelines and Compliance
Lesson 3 Learning Objectives
Terminal Learning Objective (TLO)
• Explain the importance of the formal Earned Value
Management System (EVMS) approval process
Enabling Learning Objectives (ELOs)
• Describe the 32 Electronic Industries Alliance-748 (EIA-748)
EVMS guidelines
• Describe the DoD EVMS compliance review (CR) process
2
EVM 202
November 2017
Lesson 3-5
The Earned Value Management Process:
A Circular Relationship
F
r
o
m
Organization
• Define the work
• Assign responsibilities
• Define indirect procedures
• Establish proper management controls
t
o
t
a
l
Assignments made to
responsible organizations
Planning and Budgeting
• Schedule all work
• Authorize all work
• Time-phase the work
• Develop controlaccounts
t
o
d
e
t
a
i
l
Maintenance of budget, work,
and schedule relationships
d
e
t
a
i
l
Do not modify past budget or
actuals (w/o permission)
Revisions and Data
Maintenance
F
r
o
m
Analysis and Management Reports
• Understand contract status
• Use data for decision-making
t
o
t
o
t
a
l
All documents properly
maintained
Accounting Considerations
• Material costs
• Unit/lot costs
• Cost summarization
3
EVMS Standard Area 1:
Organization—5 Guidelines
•
•
•
•
•
Define the Work Breakdown Structure (WBS)
Define program Organizational Breakdown Structure (OBS)
Integrate subsidiary management processes
Identify overhead management
Integrate WBS/OBS to create control accounts (CAs)
4
EVM 202
November 2017
Lesson 3-6
EVMS Standard Area 2:
Planning and Budgeting—10 Guidelines
•
•
•
•
•
•
•
•
•
•
Schedule work
Identify products and milestones for progress assessment
Establish the performance measurement baseline (PMB)
Authorize and budget by cost elements
Determine discrete work and objective measures
Sum work package (WP) and planning package (PP) budgets
to the CA budget
Level of effort (LOE) planning and control
Establish overhead budgets
Identify management reserve (MR) and undistributed budget
(UB)
Reconcile to target costs
5
EVMS Standard Area 3:
Accounting Considerations—6 Guidelines
•
•
•
•
•
•
Record direct costs
Summarize direct costs by WBS elements
Summarize direct costs by OBS elements
Record/allocate indirect costs
Identify unit and lot costs
Track and report material costs/quantities
6
EVM 202
November 2017
Lesson 3-7
EVMS Standard Area 4: Analysis and
Management Reports—6 Guidelines
•
•
•
•
Calculate schedule variance (SV) and cost variance (CV)
Analyze significant variances
Analyze indirect CVs
Summarize performance data and variances for management
reporting
• Implement corrective actions
• Maintain estimate at completion (EAC)
7
EVMS Standard Area 5: Revisions and
Data Maintenance—5 Guidelines
•
•
•
•
•
Incorporate changes in a timely manner
Maintain baseline and reconcile budgets
Control retroactive changes
Prevent unauthorized revisions
Document PMB changes
8
EVM 202
November 2017
Lesson 3-8
Guideline Intent
9
Guideline Intent (Cont.)
10
EVM 202
November 2017
Lesson 3-9
DoDI 5000.02 EVM Application Requirements
Enclosure 1 Table 8
Table 8 summarizes EVM application requirements. EVM is applied to cost reimbursable or incentive contracts,
inclusive of options, with 18 months or greater period of performance and based on the nature of the work
scope.
Contract Value
Applicability
Notes
< $20M
EVM not required; may be
applied at PM discretion
based on risk to the
Government
Requires business case analysis and MDA
approval
≥ $20M & < $100M
EVM Required; contractor is
required to have an EVM
The Government reserves the right to review a
system (EVMS) that
contractor’s EVMS when deemed necessary to
complies with the guidelines verify compliance
in EIA-748*
≥ $100M
Source
Part 7 of OMB Circular
A-11 (Reference (c));
DFARS 234.201
(Reference (al)); This
The Contractor will provide access to all pertinent instruction
EVM Required; contractor is records and data requested by the Contracting
required to have an EVMS Officer or duly authorized representative as
that has been determined to necessary to permit initial and ongoing
be in compliance with the
Government compliance reviews to ensure that
the EVMS complies, and continues to comply,
guidelines in EIA-748*
with the guidelines in EIA-748*.
Additional Information
For ACAT ID and IAM programs, OSD USD(AT&L) Performance Assessments and Root Cause Analyses (PARCA), in
coordination with the CAE or designee, will review proposed contract work scope for EVM applicability and provide a
recommendation to the DAE/MDA for a determination of EVM applicability. For all other ACAT levels, the CAE, or designee, will
review and determine EVM applicability. If EVM is determined to apply, then threshold application in this table is utilized or a
waiver from the CAE is required. If, based on the nature of the work, EVM is determined not to apply, then EVM is not placed on
contract.
Applying EVM outside the thresholdsand criteria above, to include application on firm, fixed-price (FFP) contracts, FFP task
orders, or FFPdelivery orders, a cost-benefit analysis will be conducted, MDAapproval is required, and the results provided to the
contracting officer for documentation in the contract file.
The term "contracts” includes contracts, subcontracts, intra-government work agreements, and other agreements.
For indefinite delivery, indefinite quantity (IDIQ) contracts, inclusion of EVM requirements isbased on the estimated ceiling of
the total IDIQ contract, and then is applied to the individual task/delivery orders, or group(s) of related task/delivery orders, that
meet or are expected to meet the conditions of contract type, value, duration, and work scope. The EVM requirements should be
placed on the base IDIQ contract and applied to the task/delivery orders, or group(s) of related task/delivery orders. “Related”
refers to dependent efforts that can be measured and scheduled across task/delivery orders.
The Integrated Baseline Review is required when EVM is determined to be applicable.
The initiation of an over-target baseline or over-target schedule must be approved by the Government program manager.
Application thresholds are in then-year dollars.
* EIA-748 = Electronic Industries Alliance (EIA) 748-C (Reference (au))
1
EVMS Compliance versus Approval
• Compliance—The continuing operation of contractor’s EVMS
in accordance with the 32 EIA-748 EVMS guidelines
• Approval—A formal recognition of certification by an
independent party that contractor’s EVMS meets the 32 EIA748 EVMS guidelines
– DoD: Conducted by Defense Contract Management Agency (DCMA)
– Intelligence and other agencies: Recognize DCMA EVMS approvals
or may conduct own approvals
– DoD Tri-Lateral Memorandum of Understanding (MOU): Recognizes
EVMS approvals performed by Canada and Australia
12
EVM 202
November 2017
Lesson 3-10
Limited DoD Alternatives for EVMS
Acceptance
• DoD does not recognize:
– EIA-748 third-party and self approval options
– Other U.S. agency approvals (e.g., FAA, DOE, IRS, etc.)
• Foreign government approvals—DoD has formally entered into
a tri-lateral MOU with Canada and Australia regarding EVMS
approvals
• DoD-conducted approval
13
Compliance Review (CR) Process
• Formal review conducted to
evaluate EVMS processes and
implementation compliance with
the 32 guidelines
• DCMA has overall compliance
determination responsibility
• Documented system implemented
on the reviewed program(s)
• Valid, timely, andauditable
program information is
consistently generated
14
EVM 202
November 2017
Lesson 3-11
CR Team
• CR Director—Director, EVM Implementation Division (EVMID)
• CR Chief—Assigned by CR Director
• CR Team Members
– Formally assigned to CR Team
– Knowledge of both program and contract is desirable
– Skills should include formal training and experience in implementing,
maintaining, and operating EVMSs
– PMO SMEs can be used on the teams
15
Activity before the CR
• Initial Visit (IV)
– Should be accomplished three to six months after contract award
– Provides an opportunity for early dialogue between DCMA and the
contractor on the CR process
– Sets review expectations among the stakeholders
– Identifies areas of noncompliance and potential problems with the
EVMS processes and procedures
– Establishes a notional CR schedule
16
EVM 202
November 2017
Lesson 3-12
Compliance Review (CR)
• CR Activities
– Overview briefing to familiarize review team with proposed EVMS
– Review of EVMS-generated documents and reports not already
provided to team
– Interviews with CAMs, functional staff, and program managers to
assure that EVM is being used (sample basis)
– Exit briefing covering team findings and documenting open system
discrepancies
• Track Corrective Action Plans to completion
• Provide functional expertise to the Administrative Contracting
Officer (ACO)
• ACO will issue a Contracting Officer Final Determination
(COFD) Letter
17
Proof of EVMS Approval
• COFD Letter
– Formal acknowledgement that the contractor has successfully
demonstrated EVMS compliance with applicable guidelines
– Based on recommendation from Review Director to the ACO
– Only valid for the sites included in the CR
– Divisional ACO (DACO) sends COFD to Contractor
18
EVM 202
November 2017
Lesson 3-13
EVMS Approval of Subcontractors
• Subcontracted Effort (≥ $100M TY)
– Subcontractor EVMS approval should be specified in Government’s
prime contract
– Subcontractor approval options and processes are the same as the
prime contractor’s
– Subcontractor must request a Government-led CR through the prime
contractor
• Subcontractor Flow Down (< $100M TY)
– Government approval is not required
– Prime reviews subcontractor’s EVMS for compliance
– Prime contractor is responsible for EVMS surveillance
19
Lesson 3 Summary
• Terminal Learning Objective (TLO)
– Explain the importance of the formal EVMS approval process
• Enabling Learning Objective (ELO)
– Explain the intent of the 32 EIA-748 EVMS guidelines
– Describe the DoD EVMS CR process
20
EVM 202
November 2017
Lesson 3-14
EVM 202 Lesson 4:
Integrated Baseline Review (IBR)
Process
STUDENT GUIDE
CONTENTS
1.
2.
3.
4.
5.
6.
7.
8.
Learning Objectives and Additional References
LAR Vehicle Scenario
Exercise Instructions
Earned Value (EV) Techniques Exercise
Task Relationships Exercise
Critical Path and Float Exercise
Float and Duration Exercise
Project X Exercise
EVM 202
November 2017
Lesson 4-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 4-2
Learning Objectives and Additional References
Terminal Learning Objective
Examine the performance measurement baseline (PMB) validity.
Enabling Learning Objectives
•
•
•
•
•
•
Explain the PMB development process
Apply the DoD Integrated Baseline Review (IBR) policy and process
Given the Earned Value (EV) technique, analyze control account EVM variables to
select EVM metrics
Analyze a schedule using the Precedence Diagram Method (PDM)
Analyze IBR documents to determine areas of concern within the five risk areas in
preparation for control account manager (CAM) interviews
Explain the importance of PMB maintenance
Additional References
•
•
•
Defense Acquisition Portal
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
The Program Managers’ Guide to the Integrated Baseline Review Process
EVM 202
November 2017
Lesson 4-3
LAR Vehicle Scenario
Background
The Increda Corporation was selected for our contract. However, there was a protest that
delayed contract award by 3 months. The Lightweight, Assault and Reconnaissance (LAR)
Vehicle Program is now 6 months into the new Engineering and Manufacturing Development
(EMD) contract. Increda has been fully cooperating with efforts to plan the upcoming Integrated
Baseline Review (IBR) scheduled for January 15, 2017. They have completed and delivered the
LAR Responsibility Assignment Matrix (RAM). This document follows in this guide.
Relevant Information
COL Paine is looking forward to the upcoming IBR. An infantryman and Battalion Commander
for most of his career, COL Paine realizes his limited review experience is not enough to ensure
the best possible IBR will be carried out. Therefore, COL Paine is counting on you to review and
evaluate baseline development, appropriate use of EV techniques, the Integrated Master
Schedule (IMS) health, and identification of the critical path in preparation for the IBR prior to
entering the contractor's facility.
EVM 202
November 2017
Lesson 4-4
September 2016
EVM 202—Lesson 4 Integrated Baseline Review (IBR)
Process (Part 1: IBR Process and Baseline Development)
Lesson 4 Learning Objectives
Terminal Learning Objective
• Examine the performance measurement baseline (PMB) validity
Enabling Learning Objective
• Explain the PMB development process
• Apply the DoD Integrated Baseline Review (IBR) policy and process
• Given the Earned Value (EV) technique, analyze control account
EVM variables to select EVM metrics
• Analyze a schedule using the Precedence Diagram Method (PDM)
• Analyze IBR documents to determine areas of concern within the
five risk areas in preparation for control account manager (CAM)
interviews
• Analyze the current schedule to determine status
• Explain the importance of PMB maintenance
2
EVM 202
November 2017
Lesson 4-5
EVM within the Contracting Process
3
DoDI 5000.02 EVM Policy Guidance
Enclosure 1 Table 8 EVM Application
Requirements
Contract Value
< $20M
≥ $20M & < $100M
≥ $100M
Applicability
EVM not required; may be
applied at PM discretion
based on risk to the
Government
EVM Required; contractor is
required to have an EVM
system (EVMS) that
complies with the guidelines
in EIA-748*
Notes
Source
Requires business case analysis and MDA
approval
The Government reserves the right to review a
contractor’s EVMS when deemed necessary to
verify compliance
Part 7 of OMB Circular
A-11 (Reference (c));
DFARS 234.201
(Reference (al)); This
The Contractor will provide access to all pertinent instruction
EVM Required; contractor is records and data requested by the Contracting
required to have an EVMS Officer or duly authorized representative as
that has been determined to necessary to permit initial and ongoing
be in compliance with the
Government compliance reviews to ensure that
guidelines in EIA-748*
the EVMS complies, and continues to comply,
with the guidelines in EIA-748*.
Additional Information
For ACAT ID and IAM programs, OSD USD(AT&L) Performance Assessments and Root Cause Analyses (PARCA), in
coordination with the CAE or designee, will review proposed contract work scope for EVM applicability and provide a
recommendation to the DAE/MDA for a determination of EVM applicability. For all other ACAT levels, the CAE, or designee, will
review and determine EVM applicability. If EVM is determined to apply, then threshold application in this table is utilized or a
waiver from the CAE is required. If, based on the nature of the work, EVM is determined not to apply, then EVM is not placed on
contract.
Applying EVM outside the thresholds and criteria above, to include application on firm, fixed-price (FFP) contracts, FFP task
orders, or FFP delivery orders, a cost-benefit analysis will be conducted, MDA approval is required, and the results provided to the
contracting officer for documentation in the contract file.
The term "contracts” includes contracts, subcontracts, intra-government work agreements, and other agreements.
For indefinite delivery, indefinite quantity (IDIQ) contracts, inclusion of EVM requirements is based on the estimated ceiling of
the total IDIQ contract, and then is applied to the individual task/delivery orders, or group(s) of related task/delivery orders, that
meet or are expected to meet the conditions of contract type, value, duration, and work scope. The EVM requirements should be
placed on the base IDIQ contract and applied to the task/delivery orders, or group(s) of related task/delivery orders. “Related”
refers to dependent efforts that can be measured and scheduled across task/delivery orders.
The Integrated Baseline Review is required when EVM is determined to be applicable.
The initiation of an over-target baseline or over-target schedule must be approved by the Government program manager.
Application thresholds are in then-year dollars.
* EIA-748 = Electronic Industries Alliance (EIA) 748-C (Reference (au))
EVM 202
November 2017
4
Lesson 4-6
BASELINE DEVELOPMENT
5
PMB Budget Allocation
6
EVM 202
November 2017
Lesson 4-7
PMB Budget Allocation (Cont.)
• Management reserve (MR): Budget withheld by contractor
program manager for unknowns/risk management
– NOT part of the PMB
• Undistributed budget (UB): Broadly defined activities not yet
distributed to a control account (CA) or summary level planning
package (SLPP)
–
–
–
–
Is NOT time-phased
Does not have a WBS number
IS part of the PMB
Is a short-term holding account; UB to be distributed into SLPPs or CA
• Summary level planning package (SLPP): Far-term contract
activities not yet defined into CAs
– IS time-phased
– Can be distributed to reporting level WBS elements at a higher level
than the CA, which distinguishes it from UB
– IS part of the PMB
7
Baseline Planning Approaches
• Detailed planning of all contract tasks is not usually possible at
the contract’s start
• Detailed planning is done in “waves” or increments
• Once the nearest-term work is completed, the next segment of
work is detail planned, and then the next, etc.
• Detailed planning concepts include:
– Rolling wave—Always detail plan a certain number of months into the
future; constant planning mode
– Block planning—Plan a block of time or to the next major milestone;
planning in increments, not in constant planning mode
8
EVM 202
November 2017
Lesson 4-8
PMB Development Steps
Category
Steps
Scope
1. Identify the scope of work
2. Extend to control account (CA)/work package level
Schedule
3. Arrange the work packages in order
4. Schedule work packages
5. Classify the work and select an earned value (EV)
technique
Budget
6. Budget the work packages
7. Spread the budget over time
8. Calculate cumulative budgeted cost for work scheduled
(BCWScum)
9
The Control Account:
A Key Management Control Point
(Responsibility Assignment Matrix)
10
EVM 202
November 2017
Lesson 4-9
Scheduling Process Overview
• The Integrated Master Plan (IMP) is an event-based plan,
which serves as the starting point for the Integrated Master
Schedule (IMS)
• The IMS should reflect contract milestones and technical
requirements
• The IMS and lower level schedules must provide vertical and
horizontal traceability
• Integrated product team (IPT) members must be
knowledgeable of commonly used schedule presentation
techniques
11
Schedule Integration
The IMS and lower level schedules must be
traceable both vertically and horizontally.
Summary Master Schedule
• Contract program schedule
• Shows horizontal integration
Intermediate Schedule
• Major event or functional
organization milestone schedule
• Shows vertical integration to
summary master schedule and
detailed level
Detailed Schedule
• Control account and work
package schedules
12
EVM 202
November 2017
Lesson 4-10
Integrated Master Schedule (IMS)
*LRE = Latest revised estimate; the contractor’s estimate at
completion (EAC)
13
Intermediate Schedule
14
EVM 202
November 2017
Lesson 4-11
Detailed Schedule
15
Determine When Tasks Happen
16
EVM 202
November 2017
Lesson 4-12
Classifying the Work
• Discrete or measurable
– Specific end product or result
– Most objective category of work because the work is objective
• Apportioned effort
– Work dependent on other discrete work
• Level of effort (LOE)
– Has no specific product or hard to measure
– Does not have to be level loaded
17
EV Techniques
• Discrete tasks
–
–
–
–
–
–
0/100 method
50/50 method
Incremental milestone method
Equivalent unit method
% complete method
Supervisor’s estimate method
• Apportioned effort
– Measured as a factor, e.g., 10% of discrete task
• Level of effort (LOE)
– Scheduled work earned based on passage of time
Prefer or require most objective technique
18
EVM 202
November 2017
Lesson 4-13
EV Techniques Illustrated
Method
BAC
Time Period
0/100
4
1 Period
50/50
8
2 Periods
Incremental
Milestone
20
2 or more periods
Equivalent Units
Complete
18
Varies
% Complete
72
Varies
Apportioned
Varies
Level of Effort
(LOE)
Varies
BCWP Calculation
Tied to the discrete task
(e.g., QA is 5% of pipe welding
work package budget)
BCWP = BCWS
19
Budget the Work Packages
Labor
Work
Package 1
7
Work
Package 2
Work
Package 3
Work
Package 4
Material
Other
Total
7
11
28
11
28
9
9
20
EVM 202
November 2017
Lesson 4-14
Calculate Cumulative BCWS
21
Draw the PMB from the Cumulative BCWS
22
EVM 202
November 2017
Lesson 4-15
PMB Development Concepts
•
•
•
•
•
•
•
Represents all work
Is a participative process
Is time-phased to contract and program milestones
Is budgeted appropriately
Reflects risk assessment
Is realistic/achievable
Is objective/measurable
23
PMB Summary
•
•
•
•
Identifies the supplier’s plan to do the work
Integrates technical, schedule, and cost
Helps identify problems and allows early correction
Defines means of determining status
24
EVM 202
November 2017
Lesson 4-16
EV Techniques Exercise
Key:
Comp = Complete
LOE = Level of effort
MS = Milestone
25
BASIC SCHEDULING
26
EVM 202
November 2017
Lesson 4-17
Why Should You Care about Scheduling?
•
•
•
•
•
Provides basis for project communication
– Identifies key milestones, activities, and interdependencies
– Provides baseline for performance measurement
– Provides current status and forecasts completion dates
Allows management by exception
– Focus on critical path and slipping tasks
Supports Better Buying Power (BBP)
– Basis to analyze resource leveling and facility/range availability
– Exploration of alternatives in cost/time trade-off studies
Schedule status reported to management
– Through Central Repository (CR) and Defense Acquisition Executive
Summary (DAES) to the Office of the Secretary of Defense (OSD)
– Through Selected Acquisition Report (SAR) to Congress
– Program schedule is a key consideration at milestone decisions
Schedule slips may result in funding cuts and/or other major impacts
To accomplish project objectives on time
27
Baseline Versus Current Schedule
Current
schedule—The
plan reflecting
actual
accomplishments
and projections
for completing
remaining
objectives
Baseline—The
original approved
plan for
accomplishing
project objectives
28
EVM 202
November 2017
Lesson 4-18
Network Scheduling Process
• Tasks
– Identify everything that needs to be done
– Ensure tasks trace to the WBS
• Duration
– Identify the duration of each task
– Determine the measure of duration (e.g., calendar days vs. business days)
• Order
– Identify what must happen before each task
– Establish criteria for starting a task
• Constraints
– Limitations to what may be done (e.g., facilities, resources)
29
Precedence Diagram Method (PDM)
Task Relationships
•
•
•
•
Finish-to-start
Finish-to-finish
Start-to-start
Start-to-finish
30
EVM 202
November 2017
Lesson 4-19
Task Relationships—Finish-to-Start
B cannot start until A has finished
e.g., You cannot plant the flower until you have dug the hole.
31
Task Relationships—Finish-to-Finish
B cannot finish until A has finished
e.g., You cannot finish the analysis until the testing is finished.
32
EVM 202
November 2017
Lesson 4-20
Task Relationships—Start-to-Start
B cannot start until A has started
e.g., You cannot analyze test data until you have started testing.
33
Task Relationships—Start-to-Finish
B cannot finish until A has started
e.g., You cannot shut down the old
computer system until the new one
has come on line.
34
EVM 202
November 2017
Lesson 4-21
Task Relationships—Finish-to-Start with a
Lag
B cannot start until 1 day after A has finished
e.g., You cannot remove the forms until 1 day after
the concrete is poured.
Lag should always be positive. A negative lag is called a lead
and should not occur in a schedule.
35
Task Relationships—Start-to-Start with
a Lag
B cannot start until 1 day after A has started
e.g ., You cannot start painting until 1 day after the primer has set.
ID
1
3
4
Task Name
Duration
TASK A
TASK B
2 days
2 days
% Complete
Week 1
Sun
Mon
Tue
Wed
Thu
Fri
Sat
Week 2
Sun
Mon
50%
0%
36
EVM 202
November 2017
Lesson 4-22
Task Relationships Exercise
37
Work Accomplished Out of Sequence?
•
Possible scenarios:
–
–
–
–
EVM 202
Task more complex than planned
Relationship not required for subsequent tasks (redundant logic)
Work completed, schedule not updated—incorrect status
Purposefully decided to work out of sequence
November 2017
38
Lesson 4-23
Changing the Model Relationships
•
Team changed relationships to reflect reality
•
Legitimate planning techniques can be abused after a project starts—can add
unnecessary risk if used incorrectly
Things to look for:
•
–
–
Sequential relationships changing to overlapping
Task relationships changing from finish-to-start to start-to-start or finish-to-finish—Ask why?
39
Poor Scheduling Practices
EVM 202
•
Poor scheduling practices can make it more difficult to use the schedule.
•
The finish-to-start relationship between Task A and Task E is an example of
redundant logic. The logic is already addressed through the finish-to-start
relationship between Tasks A and B and the finish-to-start relationship between
Tasks B and E.
November 2017
40
Lesson 4-24
Constraints
• A constraint is a field that imposes a restriction on the start
date (start constraint) of a task or milestone or on the finish
date (finish constraint) of a task and/ormilestone
• Hard constraints anchor a schedule or task in time to a
specific date regardless of predecessor logic
• Soft constraints anchor a task’s start or finish date but they
respect predecessor logic and allow the schedule end date to
move to the right (or slip)
• Use of constraints within a schedule should be minimized
• Constraints should never be used in the place of proper logic
ties in the executable IMS
• For network calculation purposes, it is essential to limit and
control the use of constraints
41
Schedule Analysis
• Forward pass—Determines earliest time (dates) for each
activity (earliest finish time, EFT)
EFT = EST + Duration - 1
• Backward pass—Determines latest time (dates) for each
activity (latest finish time, LFT)
LST = LFT – Duration + 1
• Float—Amount of time an activity can be delayed or expanded
before it impacts the project finish time (Float = the lesser
value of either LST - EST or LFT - EFT)
• Critical path—A sequence of discrete tasks/activities and
milestones through the network that has the longest duration
through the project with the least amount of float
42
EVM 202
November 2017
Lesson 4-25
Critical Path and Float Exercise
Determine the critical path and note any poor scheduling practices.
43
Gantt Chart Schedule View
• Software is typically used to develop a contract or project schedule.
• A Gantt chart displays the activities and milestones in a project
against time.
• This Gantt chart of the Critical Path and Float Exercise project was
developed in MS Project.
44
EVM 202
November 2017
Lesson 4-26
Gantt Chart Critical Path
To determine the critical path, start with the first task in the project
and work through the network following these steps:
1.
Identify the first task on the critical path:
a.
b.
Eliminate summary tasks (an aggregation of subordinate tasks, no
predecessors or successors).
Eliminate completed tasks (check the Actual Finish date).
Note: An incomplete task with the earliest start date is usually the first task on
the critical path. If two or more tasks have the same start date, select the one
with the latest finish date.
2.
If a task is on the critical path, evaluate its successor tasks to
determine next task on critical path:
a.
b.
c.
3.
Apply steps 1a and 1b.
Find the successor with the latest finish date and least amount of float
(usually 0 days).
Always check relationship logic between tasks.
Repeat step 2 for each task on the critical path until you have mapped
out the complete critical path to the end of the project.
45
Determine Critical Path in Scheduling Tool
Gantt Chart
1. Identify the first task on the critical path.
– ID 0 (Project Summary): This is a summary task, so it is not on the critical path.
– Task A:
• Is not a summary task and is not complete (i.e., Actual Finish = NA)
• Is the first incomplete task in this project, with the earliest start date and the least
amount of float (0 days), so is the first task on the critical path
Note that Task A is represented by a red bar on the Gantt chart, which is a typical Gantt
chart format for critical tasks.
Tasks on critical path so far: Task A
EVM 202
November 2017
46
Lesson 4-27
2.
Determine Critical Path in Scheduling Tool
Gantt Chart (Cont. 1)
Evaluate the successors for tasks on the critical path.
–
Using successor column: Task A has three successors: 2SS+3, 4, and 6.
•
•
•
•
–
Successors are identified by their ID number.
SS+3 refers to start-to-start plus a lag of 3 days.
IDs 4 and 6 are finish-to-start relationships, the most common type.
None of the successors are summary tasks or are complete.
Evaluate each successor to see if it has the latest finish date and least amount of float.
•
Task B has 3 days of float with a finish date of 1/4/07. It is not represented by a red bar on the chart.
• Task D has 0 days of float with a finish date of 1/15/07. It is represented by a red bar on the chart.
• Task F has 6 days of float. Its finish date is 1/21/07. It is not represented by a red bar on the chart.
• Is Task D (0 float) or Task F (latest finish date) on the critical path? Check the relationship logic to see
what it tells you.
47
Determine Critical Path in Scheduling Tool
Gantt Chart (Cont. 2)
2.
Evaluate the successors for tasks on the critical path(continued).
–
Task A has a finish-to start-relationship with Task D and Task F. Task D also has a finish-to-start
relationship with Task F. This is the redundant logic illustrated earlier in the PDM example.
– The redundant logic can be removed between Tasks A and F, leaving just Tasks D and B as
Task A’s successors.
– Of the two remaining successor tasks, Task D has the latest finish date and least amount of
float, so it is on the critical path. Task D is represented by a red bar on the chart.
Tasks on critical path so far: Tasks A and D
EVM 202
November 2017
48
Lesson 4-28
Determine Critical Path in Scheduling Tool
Gantt Chart (Cont. 3)
3.
Repeat step 2 for each task on the critical path.
–
Task D, the next task on the critical path has two successors, Tasks F and G.
•
•
–
–
–
Neither Task F nor G is a summary task or completed.
Task G has the latest finish date and least amount of float (0 days), so it is next on the critical path. Task G
is also represented by a red bar on the chart.
Now the tasks on the critical path are A – D – G.
Next, evaluate the Task G’s successors. Task G has only one successor, Task H, which has 0 float
days and is the last task in the network. Task H is represented by a red bar on the chart.
The critical path is A – D – G – H, just as was determined using the PDM schedule.
Tasks on critical path: Tasks A – D – G – H
49
RESOURCE LOADING ANALYSIS
50
EVM 202
November 2017
Lesson 4-29
Early Start
51
Late Start
52
EVM 202
November 2017
Lesson 4-30
Level Loaded
53
EVM 202
November 2017
Lesson 4-31
September 2016
EVM 202—Lesson 4 Integrated Baseline Review
Process (Part 2: )
EVM 202
November 2017
Lesson 4-32
Open MS Project
1.
2.
3.
4.
5.
Open MS Project from the Start button.
Select File > Open > LAR 2016-12 (DEC16)FY16. (The
instructor will provide the file location.)
View the baseline and current schedules by going to Task >
View > Analysis Gantt.
Find the Status Date on the Project tab by selecting Project
Information or checking Status Date on the toolbar.
Ensure the Status Date Line is showing. If not, go to Format
and select Gridlines > Status Date > Type - - - > Color Red.
(You can also right-click in the white space and select
Gridlines.)
2
EVM 202
November 2017
Lesson 4-33
Open MS Project (Cont.)
6.
7.
To show the task relationship arrows, select Format > Layout
> Link Type 2 and select OK. You can also change the bar
height in this box.
If quarters are not displayed, right-click on the Timescale Bar
and select Timescale > Middle Tier > Label and change the
label to Q1 ‘09, Q2 ‘09, ....
3
EVM 202
November 2017
Lesson 4-34
MS Project Symbols
1.
2.
3.
In the graphic display area, double-click in the white space to
display a legend box.
In the graphic display area, place your cursor over any item
and a pop-up legend box will appear for ten seconds.
Double-click on any task name. A dialog box will appear with
more data.
4
EVM 202
November 2017
Lesson 4-35
Schedule Health Metrics
1.
2.
3.
4.
5.
Open Steelray Project Analyzer from the Start button.
Select, LAR 2016-12 (DEC16) FY16 from Projects in the left
navigation pane.
If the file is not visible in the navigation pane, select Project from the
top menu bar, then Add Project (the instructor will provide the file
location), and select the file.
Select DCMA 14 Point Assessment from Reports in the left
navigation pane.
If the file is not visible in the navigation pane, select Report from the
top menu bar, then select DCMA 14 Point Assessment, and select
Add to add the file to the navigation pane.
Check the boxes by the LAR 2016-12 (DEC16) FY16 under Projects
and DCMA 14 Point Assessment under Reports
Press the Analyze button at the bottom.
5
EVM 202
November 2017
Lesson 4-36
Schedule Health Metrics (Cont.)
LAR Schedule
Value Potential Impact
Missing Logic
3%
Hard Constraints
(Tasks w/
Constrained
Dates)
< 1% Tasks should rarely be artificially tied to dates. Durations combined
with schedule logic should determine schedule dates. Use of
constraints may result in incorrect calculation of the critical path and
near critical paths.
High Float
71% Large positive or negative slack values may indicate a poorly
constructed schedule. Large positive slack may indicate poor or
missing logic. Tasks w/ Total Slack > 44 days
High Duration
38% Industry consensus is that near term tasks should be a week to a
month in length. When more than a month, you will not be able to get
an accurate estimate of progress and forecasted completion dates.
Tasks w/ Duration > 44 days
Baseline Execution
Index (BEI)
0.87 This measure the tasks that were completed as a percentage of the
tasks that should have been completed per the original (baseline)
plan. The goal is to have a BEI of .95 or greater.
EVM 202
Almost every task should have a predecessor and successor
6
November 2017
Lesson 4-37
Network Schedule Analysis
• Why: To answer the question: Will the program be delivered on
time to meet the APB schedule requirements, the contractual
delivery requirements, and the needs of the warfighter?
• What: Schedule is a key element of integrated program
management. Analyze the network schedule (i.e., the Integrated
Master Schedule, or IMS) to forecast completion dates for APB
schedule parameters, contract deliverables, and technical risk
drivers.
• How:
– Compute schedule metrics
– Review the critical path and determine the project’s schedule drivers
• Do the schedule drivers correlate with the technical risk drivers?
• If not, why not?
• Filter MS Project for critical tasks
– Assess slipping tasks
• Filter MS Project for slipping tasks
– Determine the amount of float and duration change for the technical risk
drivers
– Analyze the network schedule for milestones and correlate with APB
schedule parameters and contract delivery requirements
• Filter MS Project for milestones
7
EVM 202
November 2017
Lesson 4-38
Schedule Task Metrics
Baseline Execution Index (BEI)
Source: IMS 8.31.06
1.20
2500
2000
0.80
1500
0.67
0.60
0.64
0.61 0.61
0.61
0.55
1000
0.46
0.40
0.22
0.20
500
0.28
0.20
0.12 0.11
0.00
0.14
0
0.00
Jul-05 Aug-05 Sep-05 Oct-05 Nov-05 Dec-05 Jan-06 Feb-06 Mar-06 Apr-06 May-06 Jun-06 Jul-06 Aug-06
Task Hit/Miss
NUMBER OF TASKS
TASK HIT/MISS PERCENTAGE
1.00
BEI
0.00 0.22 0.28 0.12 0.11 0.20 0.67 0.14 0.61 0.61 0.55 0.46 0.64 0.61
Planned cumulative
986
1004
1033
1066
1102
1122
1125
Actual cumulative
804
825
839
859
882
900
910
1209
999
1356
1427
1077
1134
1512
1200
1581
1271
1756 1955
1376 1516
27
Hit Task Percentage: Graphically displays the percentage of
current month baseline tasks/activities actually completed (or hit) on
or ahead of their baseline schedule
Number of tasks finished on or ahead of their
baseline schedule that were baselined
to be finished in THIS month
Hit Task Percentage =
Number of tasks baselined to be finished in THIS month
Baseline Execution Index (BEI): Indicates the efficiency with
which actual work has been accomplished when measured against
the baseline; tasks missing baseline finish dates are included in the
denominator
BEI =
Total number of tasks finished
Total number of tasks baselined to be finished
+ Tasks without baseline finish dates
8
EVM 202
November 2017
Lesson 4-39
Schedule Metrics—Hit Task Percentage
1.
2.
3.
Insert columns for Milestone, Baseline Finish, and Actual
Finish.
Go to the Format tab and uncheck the Summary Task and
Project Summary Task boxes to remove the summary tasks.
Filter out the milestone
tasks. Use the down
arrow on the Milestone
column and select No
under Filters.
9
EVM 202
November 2017
Lesson 4-40
Schedule Metrics—Hit Task Percentage
(Cont.)
4.
5.
Custom filter for baseline
finishes occurring during
the current month. Use
the down arrow on the
Baseline Finish column
and select Filters and
Custom. The number of
tasks equals the
denominator (10).
Filter again for the actual
finishes on or before the
baseline finish date. The
number of tasks equals
the numerator (6).
Number of Dec 16 tasks finished on
6
or ahead of baseline schedule
Hit Task Percentage = Number of tasks baselined to be = 10= 60%
finished in Dec 16
EVM 202
November 2017
10
Lesson 4-41
Schedule Metrics—BEI
1.
33
Total number of tasks finished
=
= 0.87
BEI =
Total number of tasks baselined to
38
befinished+ Taskswithoutbaseline finish dates
2.
3.
4.
EVM 202
Remove filters for the Baseline Finish and Actual Finish columns.
Use the down arrow on the column and select Clear Filter…. Keep
the filter for milestones.
Create a dual filter for baseline finishes occurring before the
beginning of the next month or baseline finishes equal to “NA”. The
number of tasks equals the denominator (38).
Remove the baseline finish filter.
Filter again for all actual finishes that do not equal “NA”. The
number of tasks equals the numerator (33).
11
November 2017
Lesson 4-42
Identify Critical Path
1.
2.
3.
4.
5.
Add the Predecessor and Successor columns.
Hide Summary Tasks by selecting the corresponding checkbox onthe
Format tab.
Select Critical from the View tab’s Filter drop-down menu (this filters for
tasks with a float value of 0 or less).
Insert Start column and then sort by Start Date (earliest to latest) to find
the first task on the critical path.
Any schedule item colored red is critical and has a float value of 0 or less.
12
EVM 202
November 2017
Lesson 4-43
Identify Critical Path (Cont.)
6.
Review the LAR Vehicle program critical path WBS elements.
What tasks are on the critical path to the next two milestones?
– Exhaust to Subsystem CDR
– Engine to System CDR
13
EVM 202
November 2017
Lesson 4-44
Slipping Task Filter
1.
2.
3.
From the View drop-down menu, select Filter for > More
Filters > Slipping Tasks from the pop-up window.
Identify tasks with projected end dates later than their baseline
finish, particularly if they are on the critical path. If they are not
on critical path, how much float do they have? Are they close to
the critical path?
Review other filters: Completed Tasks, In Progress Tasks,
and Incomplete Tasks.
14
EVM 202
November 2017
Lesson 4-45
Float and Duration Exercise
• Filter for Slipping Tasks - Compare float, duration, slip, and
work progress to identify near critical path tasks and tasks with
questionable status.
• Float and slip time are work days (five-day weeks).
• MS Project selects the longest float of sub-elements for the
summary float.
15
EVM 202
November 2017
Lesson 4-46
Milestone Assessment
1.
2.
3.
From the View drop-down menu, select Filter for > Milestones
and find the dates for the remaining milestones.
Compare the milestone dates in the IMS with the information
from your network schedule analysis to see if you think these
dates might be off.
Compare the project milestone dates with the contract delivery
requirement dates. Are there potential contract delivery issues?
16
EVM 202
November 2017
Lesson 4-47
Project X Exercise
• Refer to the Determine the Critical Path Using a Gantt Chart
job aid
17
EVM 202
November 2017
Lesson 4-48
September 2016
EVM 202—Lesson 4 Integrated Baseline Review
Process (Part 3: IBR Process)
The Program Managers’ (PMs’) Guide to the
Integrated Baseline Review (IBR) Process
While most IBRs generally conform to DoD
policy, inconsistent policy interpretations resulted
in the development of individual Service/Agency
IBR guidebooks, differing perceptions of purpose
and value, and inconsistent IBR execution. To
improve the consistency of the overall IBR
Process, The Program Managers’ Guide to the
Integrated Baseline Review Process was
developed (TAB A). This Guide clearly defines
the purpose, goals, and objectives of an IBR. It
also describes attributes of an effective IBR and
discusses a baseline review process that will
lead to a better understanding of program risks.
This Guide is the principal IBR reference and
should be used to implement an integrated
baseline discipline on an acquisition program.
PMs are strongly encouraged to use this Guide
during IBR training, when preparing for an IBR,
and then again during the actual execution and
conduct of the IBR.
2
EVM 202
November 2017
Lesson 4-49
IBR Process
PMB Assessment
IBR Preparation
• Identify expectations/
assumptions
• Identify teamcomposition
• Determine responsibilities
• Conduct training
• Establish PMB
Program Managers’
Mutual Understanding
Management Processes
• Baseline maintenance
• Risk management
• Business processes
IBR Execution
• Evaluate PMB
• Identify risks and update
Risk Management Plan
• Assign responsibility for
risk mitigation
3
Performance Measurement Baseline
(PMB) Assessment
• Examines Government and contractor PMs’
mutual understanding of the PMB and risks
• Results in IBR execution or PMs’ continued
utilization of their management processes
• May be required by policy or contract
– DoDI 5000.02—Operation of the Defense Acquisition System
• IBRs are required whenever EVM is required (compliance with EIA-748)
– DFARS Clause 252.234-7002
• The Government will schedule IBRs as early as practicable, and the review
process will be conducted not later than 180 calendar days after contract
award, the exercise of significant contract options, and the incorporation of
major modifications.
4
EVM 202
November 2017
Lesson 4-50
IBR Preparation
• IBR Plan
• Risk areas
–
–
–
–
–
Technical risk
Schedule risk
Cost risk
Resource risk
Management process risk
• Team composition
• Responsibilities
• Training
Preparation for the IBR should begin as soon as practical.
5
IBR Preparation—Expectations
• Integrated Product Team (IPT)
members should develop a plan
for conducting the review:
– Define the objectives for the IBR
– Plan and schedule review dates
– Identify required technical
expertise
– Identify key responsibilities
– Identify documentation needs
– Review IBR documents
– Plan and conduct IBR training
– Identify procedures for risk
identification, documentation, and
incorporation into project risk
management planning
– Establish risk evaluation criteria
– Establish how IBR findings will be
documented and resolved
6
EVM 202
November 2017
Lesson 4-51
Notional IBR Planning Schedule
7
IBR Preparation—Risk Areas
• Technical risk—Ability of project’s technical
plan to achieve the scope of work objectives
• Schedule risk—Adequacy of time allocated
for performing the defined tasks to achieve
project schedule objectives successfully
• Cost risk—Ability of the PMB to execute the project and attain
cost objectives successfully, recognizing the relationship between
budget, resources, funding, schedule, and scope of work
• Resource risk—Availability of personnel, facilities
(manufacturing/test), and equipment, when required, to perform
the defined tasks needed to execute program successfully
• Management processes risk—Degree to which management
processes provide effective and integrated technical, schedule,
and cost planning and baseline change control
8
EVM 202
November 2017
Lesson 4-52
IBR Preparation—Expectations (Cont.)
• Identify documentation needs
–
–
–
–
Contract Work Breakdown Structure (CWBS)
CWBS Dictionary
Contractor’s Organizational Breakdown Structure (OBS)
Responsibility assignment matrix (RAM)
– Work AuthorizationDocuments
(WADs)
– Integrated Master Schedule (IMS)
– Risk Management Plan and risk
register
– Control Account Plans (CAPs)
– Current Integrated Performance
Management Report (IPMR)/
Contract Performance Report (CPR)
– Contract Funds Status Report
(CFSR)
– Detailed control account (CA)
schedules
– Earned Value Management
System (EVMS) Description
– Subcontractor data
– Basic contract
– P000 modifications
– EVMS Surveillance Reports
– DCMA/DCAA findings (Corrective
Action Request (CAR))
– Schedule Risk Assessment (SRA)
9
IBR Preparation—Team Composition
• Participants should be identified based on
their programmatic or technical expertise, as
required for the review
• The size and composition of the team should
reflect the PMs’ objectives, expectations,
and risk assumptions
• Disciplines include:
–
–
–
–
Program management
Business management
Subcontract management
Subcontractor personnel (when
appropriate)
– Technical management
•
•
•
•
•
•
System engineering
Software engineering
Manufacturing
Integration and test engineering
Integrated logistics support
Training
10
EVM 202
November 2017
Lesson 4-53
IBR Preparation—Responsibilities
• PMs are jointly responsible for the IBR Process
and for completing the following tasks:
– Plan and perform the IBR
– Provide an adequate number of qualified personnel
to serve as IBR team members
– Specify evaluation criteria for risk areas
– Document risk issues identified during an IBR
– Manage progress on required actions until issues
are resolved
11
IBR Preparation—Training
• PMs’ expectations
• Project management aspects
– IBR objectives
– IBR approach and expectations
– Risk identification and
documentation
• Management processes*
– Baseline maintenance*
– Risk management*
– Business processes (including
EVM)*
– Statement of Work (SOW)/Statement
of Objectives (SOO)
– Work Breakdown Structure (WBS)
Dictionary/Matrix
– Funding
– WorkAuthorization Documents
(WADs)*
– Control Account Plans (CAPs)*
– Terms and acronyms*
– Budget and schedule baselines*
– Subcontractor management*
– Management reserve (MR)*
*Note: The contractor should brief this content during the training.
12
EVM 202
November 2017
Lesson 4-54
Responsibility Assignment Matrix (RAM)
Exercise
• Review the RAM to identify three control account managers
(CAMs) to interview
– Items to consider
• Risks
• Dollar value
• Differences from Government estimates
13
LAR Vehicle RAM
14
EVM 202
November 2017
Lesson 4-55
IBR Preparation Summary
• IBR Preparation identifies:
–
–
–
–
–
–
–
–
–
Key responsibilities
Required technical expertise
Training
Review dates
Review scope
Risk evaluation criteria
Documentation needs
Disposition of findings
Procedures for risk
identification, documentation,
and incorporation into project
risk management planning
• Before executing the IBR, ensure the PMB reflects the entire
scope of work, documented at the appropriate level of detail
15
IBR Execution Requirements
• The IBR is intended to provide the PMs with
a mutual understanding of the project PMB
and mitigate program risks.
– Technical scope of work is fully included and consistent with authorizing
documents
– Key schedule milestones are identified
– Supporting schedules reflect a logical flow to accomplish the technical
work scope
– Resources (budgets, facilities, personnel, skills, etc.) are adequate and
available for the assigned tasks
– Tasks are planned and can be measured objectively
– Underlying PMB rationales are reasonable
– Managers have implemented required management processes
– MR is sufficient with respect to project risk
16
EVM 202
November 2017
Lesson 4-56
IBR Execution—Document Review
• Trace
– Statement of Work (SOW) to Work Authorization
Documents (WADs)
– WADs to control accounts
– Control accounts to work packages/planning
packages
– Work packages/planning packages to schedule
– Schedule dates to contract dates
• Document
–
–
–
–
Assess MR with respect to project risk not in the PMB
Issues
Risks
Inconsistencies
17
IBR Execution—Typical IBR Agenda
•
•
•
•
•
•
•
Kick-off meeting
Review IBR objectives
Supplemental document review
CAM discussions
Daily out-brief
Document results
Follow up as necessary
18
EVM 202
November 2017
Lesson 4-57
IBR Execution—CAM Discussion
• Be thoroughly prepared for the discussion;
think through your “strategy”
• Review questions and know what answer
you should receive
• Approach:
–
–
–
–
Conduct discussions in the CAM’s workplace
Have one person ask questions and one person take notes
Explain basic objectives and purpose
Open with simple questions on CAM’s area of responsibility; then proceed
to more complex matters
– Ask open-ended questions to determine familiarity with the budget and
schedule aspects of the control account (CA); employ the “Show Me”
technique
19
IBR Execution—CAM Discussion (Cont.)
• Technical assessment
• Schedule assessment
– What are the high risk areas?
– What are the conditions of
measurement?
– What are the technical
requirements?
• Work authorization
–
–
–
–
PMB changes
Schedules
Budget authorization
CAPs
–
–
–
–
Underdeveloped logic
Illogical/forced sequencing
Lack of experience
Consideration of technical risks
• Budget assessment
– Budget validity/risk
– Distribution logic
– Resources available
• Work assessment
– Which tasks may be overstated?
– Which tasks may be understated?
– What has been left out?
20
EVM 202
November 2017
Lesson 4-58
IBR Execution—After the CAM Discussion
• Take time to reflect and compile your
observations immediately after the discussion
• Maintain your own file—keep notes for
subsequent write-ups and reference
• If problems are found during discussion:
– Note discrepancies
– Communicate to the team leader—clear and concise with supporting
documentation
– If EVMS issues are identified, provide to DCMA to work separately, not as
part of the IBR
– Let the team leader handle problems with the supplier
• Consider contractor information as proprietary
21
IBR Execution—Daily Out-Briefs
• Technical—Review Integrated Master Plan
(IMP) significant accomplishments and
document technical risks
• Schedule—Review the critical path and float
and document schedule risks
• Cost—Review the realism of cost estimates and document cost
risks
• Resource—Review the sufficiency of personnel, facilities, and
equipment and document resource risks
• Management Processes—Review the management processes
and document management risks
22
EVM 202
November 2017
Lesson 4-59
IBR Execution—Closeout
• IBR team responsibilities—To document
identified risk areas and provide the PMs
with an overall project risk summary after
completing the IBR
• PMs’ responsibilities—To assess whether the IBR has
achieved its purpose
– Is there a mutual understanding of the project PMB?
– Do you understand the contractor’s plan of action to handle the
identified risks?
– Is there agreement on a closure plan of action?
– Have action officers been assigned for all identified risks?
– Have risks been incorporated into the Risk Management Plan?
23
LAR VEHICLE IBR DOCUMENTATION
REVIEW EXERCISE
24
EVM 202
November 2017
Lesson 4-60
LAR Vehicle IBR Documentation Review
Package
Documentation Review Package
• Transmittal Letter
• LAR Vehicle Statement of Work (SOW)
• LAR Vehicle Technical Performance Metrics (TPMs)
• LAR Vehicle Responsibility Assignment Matrix (RAM)
• LAR Vehicle Integrated Master Schedule (IMS)
• Work Authorization Documents for WBS 1.1.1 (Integration, Assembly,
Test, & Checkout)
• Work Authorization Documents for WBS 1.1.7.1 (Engine)
• Work Authorization Documents for WBS 1.1.7.2 (Cooling)
• Work Authorization Documents for WBS 1.1.7.3 (Exhaust)
• CAM Documents for WBS 1.1.1 (Integration, Assembly, Test, & Checkout)
• CAM Documents for WBS 1.1.7.1 (Engine)
• CAM Documents for WBS 1.1.7.2 (Cooling)
• CAM Documents for WBS 1.1.7.3 (Exhaust)
25
LAR Vehicle IBR Group Exercise
Prepare a brief to the Government PM on your assigned WBS element
taking the following into consideration:
Technical Scope (Statement of Work) Risks
• Is there adequate identification, definition, and flow down?
• Is scope consistent with contract requirements?
• Is there adequate assignment of responsibility, authority, and
accountability?
Schedules Risks
• What is the period of performance?
• Are planned durations realistic?
• Are detailed (lower level) schedules consistent with the master schedule?
• Are interdependencies defined and constraints appropriate?
• Are there any tasks on the IMS critical path?
• Do schedules support contract milestones?
• What is the schedule “health” based on DCMA metrics?
26
EVM 202
November 2017
Lesson 4-61
LAR Vehicle IBR Group Exercise (Cont.)
Prepare a brief to the Government PM on your assigned control account
(CA) taking the following into consideration:
Cost and Resource Risks
• Is there a sound basis for estimate?
• Is budget adequate and does it have correct time phasing?
• Are there any issues with resource availability?
• Are there provisions for scrap, rework, retest, or repair?
Management Process Risk
• Is cost, schedule, and technical planning integrated?
• Do they have baseline change control?
• Is accurate and timely management and performance data available?
• Is there adequate subcontract management?
• Do they use appropriate EVM methods?
• Do the methods correlate with technical achievement?
27
EVM 202
November 2017
Lesson 4-62
September 2016
EVM 202—Lesson 4 Integrated Baseline Review Process
(Part 4: Baseline Maintenance)
Management Processes
Process
Description
Baseline
Maintenance
Process
•
Maintains the PMB as a current depiction of the plan for
accomplishing remaining work and accommodates changes to PMB
caused by program dynamics
Risk
Management
Process
•
•
Documents and classifies risks associated with the PMB
PMs should document action risks from IBR in risk management
planning
Each action risk addressed in risk management planning should be
classified as to its probability of occurrence, consequences, handling,
and identification of the individuals responsible for mitigation actions
Business
Processes
•
•
•
•
Include scheduling, estimate to complete, earned value methodology,
and managerial analysis
Each process supports the project management
Inappropriate or inadequate use of these processes may fail to
identify project risks and may add risk to the project
After an IBR, the emphasis shifts to management processes, which provide PMs with a
continuous source of project information that enables a mutual understanding and reduces or
eliminates the need for future IBRs.
2
EVM 202
November 2017
Lesson 4-63
Baseline Maintenance
Ongoing Baseline Validity and Realism
• Validity
–
–
–
–
–
PMB still represents goals and objectives
PMB points to valid variances
Variances result in management action
Timely incorporation of contract changes
Proper use of management reserve (MR) and undistributed budget (UB)
• Realism
– PMB changes made for management reasons, not for reporting reasons
– Use of over target baselines (OTBs)
– Use of single point adjustments (SPAs)
3
Baseline Maintenance Process
• PMB Chart—The program at a glance
• Troublesome baselines
– Front loaded
– Rubber baseline
– SPAs
• PMB changes
– Contract changes
– Internal replanning
– Formal reprogramming
4
EVM 202
November 2017
Lesson 4-64
The Program at a Glance
5
TROUBLESOME BASELINES
6
EVM 202
November 2017
Lesson 4-65
Hypothetical PMB
• Contract structure
– Period of performance: 38 months
– 1000 uniform control accounts (CAs) scheduled to approximate a
Rayleigh distribution
– CA budgets: $10/each (BCWS)
– Actual CA costs: $11/each (ACWP)
• Assume that there are no schedule issues: BCWP = BCWS
(budgeted cost for work performed = budgeted cost for work
scheduled)
• Contractor has purposely underestimated costs to win contract
– This is a buy-in contract
7
Front-Loaded Baseline PMB Plot
8
EVM 202
November 2017
Lesson 4-66
Front-Loaded Cost Variance (CV) Chart
9
Rubber Baseline PMB Plot
10
EVM 202
November 2017
Lesson 4-67
Rubber Baseline CV Chart
11
Single Point Adjustment (SPA)
• An arbitrary baseline adjustment at any level of the Work
Breakdown Structure (WBS) where BCWS is set equal to
BCWP, or BCWP is set equal to actual cost of work performed
(ACWP), or both BCWS and BCWP are set equal to ACWP
and incomplete work is replanned to be completed on schedule
and within the original PMB budget
SPAs distort earned value cost and schedule metrics and
make index-based earned value estimate at completion
(EAC) computations unreliable.
12
EVM 202
November 2017
Lesson 4-68
SPA PMB Plot
13
SPA CV Chart
14
EVM 202
November 2017
Lesson 4-69
PMB CHANGES
15
Use of Management Reserve (MR) PMB Plot
16
EVM 202
November 2017
Lesson 4-70
Use of MR CV Chart
17
Effect of Contract Changes on PMB
18
EVM 202
November 2017
Lesson 4-71
Effect of Contract Changes on CV
19
Over Target Baseline/Over Target Schedule
(OTB/OTS)
• Replanning actions involving establishing cost or schedule
objectives that exceed the desired or contractual objectives on
the program
• An OTB is a recovery plan, a new baseline for management
when the original objectives cannot be met and new goals are
needed for management purposes.
The contractor must get permission from the Government
before executing an OTB/OTS.
20
EVM 202
November 2017
Lesson 4-72
Over Target Baseline (OTB) PMB Plot
21
Effect of OTB on CV
22
EVM 202
November 2017
Lesson 4-73
IBR Risk Management Processes and
PMB
• Do PMB revisions support program goals, objectives, and
milestones?
• Changes must be incorporated in a timely manner
• Changed budgets must be reconcilable with prior budgets
• Retroactive changes must be controlled
– Changes must be made in the period the issue is identified
• The change-trail must be clearly documented
• An over-arching question: Is the new PMB valid?
23
Lesson 4 Summary
Terminal Learning Objective
• Examine the performance measurement baseline (PMB) validity
Enabling Learning Objective
• Explain the PMB development process
• Apply the DoD Integrated Baseline Review (IBR) policy and process
• Given the Earned Value (EV) technique, analyze control account EVM
variables to select EVM metrics
• Analyze a schedule using the Precedence Diagram Method (PDM)
• Analyze IBR documents to determine areas of concern within the five
risk areas in preparation for control account manager (CAM) interviews
• Analyze the current schedule to determine status
• Explain the importance of PMB maintenance
24
EVM 202
November 2017
Lesson 4-74
Exercise Instructions
Individual Task: Identify Top Three Control Accounts
The task at hand is to identify the control accounts to be reviewed at the IBR. Use the recently
delivered RAM and the information you already know about the risks on the LAR Vehicle
program to identify the top three control accounts that need to be reviewed during the IBR. We
will submit these control accounts to Increda for the delivery of detailed control account
documents.
EVM 202
November 2017
Lesson 4-75
Responsibility Assignment Matrix (RAM)
WBS
NUMBER
WBS
DESCRIPTION
BAC
$(000)
TYPE
CONTROL
ACCOUNT
NUMBER
CONTROL
ACCOUNT
MANAGER
JPO
ESTIMATE
$(000)
1
LAR
647,115
Roll-up
10000000S
655,794
1.1
Prime Vehicle
363,174
Roll-up
10100000S
392,610
1.1.1
Integration, Assembly, Test & Checkout
35,743
CA
10101000S
M Cohe
42,530
1.1.2
Hull/Frame/Body/Cab
65,969
CA
10102000S
J Little
63,190
1.1.2.1
Frame
27,097
CA
10102100S
D Melton
30,350
1.1.2.2
Body/Cab
38,872
CA
10102200S
W Weedman
32,840
1.1.5
Suspension/Steering
81,140
CA
10105000S
M Board
85,200
1.1.6
Electronics
567
CA
10106000S
E Walter
1.1.7
Power Package/Drive Train
116,615
Roll-up
10107000S
1.1.7.1
Engine
40,815
CA
10107101P
H James
49,250
1.1.7.2
Cooling System
23,323
CA
10107201P
F Valore
30,010
1.1.7.3
Exhaust System
17,492
CA
10107301P
J Martin
19,250
1.1.7.4
Other Power Package Components
34,985
CA
10107401P
F Manzer
36,460
1.1.8
Auxiliary Automotive
2,268
CA
10108000S
B Carlson
2,750
1.1.10
Armament
41,595
CA
10110000S
R Goodman
41,760
1.1.14
Communications
19,277
CA
10114000P
B Bohls
22,210
1.4
Systems Engineering
130,925
CA
10400000G
G Troop
102,346
1.5
Program Management
41,512
CA
10500000G
P I Smith
20,308
1.6
System Test & Evaluation
10,920
Roll-up
10600000S
1.6.1
Development Test & Evaluation
1,665
CA
10601000P
P Schwarz
1,933
1.6.2
Operational Test & Evaluation
1,665
CA
10602000P
P Schwarz
2,785
1.6.3
Mock-ups
4,101
CA
10603000P
P Hornick
7,350
1.6.4
Test & Evaluation Support
3,489
CA
10604000P
J Rego
6,562
1.7
Training
J Forman
8,150
1.8
Data
EVM 202
CA
8,463
November 2017
Roll-up
134,970
18,630
10800000S
11,160
Lesson 4-76
WBS
NUMBER
WBS
DESCRIPTION
BAC
$(000)
TYPE
CONTROL
ACCOUNT
NUMBER
CONTROL
ACCOUNT
MANAGER
JPO
ESTIMATE
$(000)
1.8.1
Technical Publications
2,885
CA
10801000G
V Kinney
3,160
1.8.2
Engineering Data
2,885
CA
10802000G
V Kinney
4,360
1.8.3
Management Data
2,693
CA
10803000G
T Finefield
3,640
1.9
Peculiar Support Equipment
14,107
Roll-up
10900000S
1.9.1
Test & Measurement Equipment
7,852
CA
10901000G
T Shannon
13,870
1.9.2
Support & Handling Equipment
6,255
CA
10902000G
S Tack
7,140
1.13
Initial Spares & Repair (S&R) Parts
57,073
Roll-up
11300000S
1.13.1
Brakes S&R Parts
12,932
CA
11301000P
R Freeman
15,020
1.13.2
Wheels S&R Parts
24,397
CA
11302000P
J Hanby
35,130
1.13.3
Skid Plates S&R Parts
1,043
CA
11303000P
W Thurman
2,150
1.13.4
Engine S&R Parts
1,173
CA
11304000P
B Pellegrini
2,020
1.13.5
Drive Train S&R Parts
5,220
CA
11305000P
T Forburger
4,350
1.13.6
Misc. S&R Parts
12,308
CA
11306000P
R Johnson
22,910
[OH]
OVERHEAD
[COM]
COST OF MONEY
8,218
R White
[G&A]
GEN & ADMIN
84,627
G Crystal
[UB]
UNDIST BUDGET
[PMB]
PERF MEASURE BL
[MR]
MGT RESERVE
EVM 202
21,010
81,580
P I Smith
634,392
L Stone
12,723
P I Smith
November 2017
Lesson 4-77
Group Task: IBR Documentation Review
Situation
It is Monday, January 3, 2017, and you’ve received a complete IBR documentation review
package. The formal IBR is scheduled to begin on January 15, 2017. Increda has been busy
completing detailed control account plans and summary level planning packages (SLPPs) for
the LAR Vehicle development effort. Based on our request, they have compiled review books
that include control account manager (CAM) planning documents for the Integration, Assembly,
Test & Checkout (WBS 1.1.1), Engine (WBS 1.1.7.1), Cooling System (WBS 1.1.7.2) and the
Exhaust System (WBS 1.1.7.3).
Objective
Evaluate the contractor’s implemented baseline to determine its acceptability for program
execution.
Instructions
(Use the IBR Documentation Review Briefing Template on Blackboard for this exercise.)
1. Review the IBR Documents for your assigned CAM to assess the risk areas.
2. Prepare a brief to the program manager with your preliminary assessment of the risk
areas. This should also include specific questions you would like to ask your assigned
CAM during the discussion to complete the assessment.
3. Use your team’s File Exchange on Blackboard under Team Groups > Team [A/B/C/D]
> File Exchange to complete this exercise.
Questions to be considered in the Assessment
Technical Scope (Statement of Work) Risks
Is there adequate identification, definition, and flow down?
Is scope consistent with contract requirements?
Is there adequate assignment of responsibility, authority, and accountability?
Schedules Risks
What is the period of performance?
Are planned durations realistic?
Are detailed (lower level) schedules consistent with the master schedule?
Are interdependencies defined and constraints appropriate?
Are there any tasks on the Integrated Master Schedule (IMS) critical path?
Do schedules support contract milestones?
EVM 202
November 2017
Lesson 4-78
Cost and Resource Risks
Is there a sound basis for the estimate?
Is the budget adequate and does it have correct time phasing?
Are there any issues with resource availability?
Are there provisions for scrap, rework, retest, or repair?
Management Process Risks
Is cost, schedule, and technical planning integrated?
Does the contractor have baseline change control?
Is accurate and timely management and performance data available?
Is there adequate subcontract management?
Does the contractor use appropriate Earned Value Management (EVM) methods?
Do the EVM methods correlate with technical achievement?
File Exchange Instructions
To complete your team’s IBR Documentation Review Briefing:
1. Select the Lesson 4 tab from the Course Menu on Blackboard.
2. Download the IBR Documentation Review Briefing Template under Task: IBR
Documentation Review Briefing.
3. Save the file to your computer.
4. Complete each section of the IBR Documentation Review Briefing as a team.
5. To share draft files with your team members:
a. Select the Team Groups tab on the Course Menu.
b. Select your team’s link under Groups.
c. Select File Exchange under Group Tools to upload and share files.
d. Select Add File to upload a file.
e. Select Browse My Computer to locate the file on your computer.
f. Enter a Name for your file in the Name field.
g. Select Submit to post the file to your team’s File Exchange.
6. Upload your Final IBR Documentation Review Briefing to your team’s File Exchange.
 Note: Name your file “Final IBR Documentation Review Briefing” to
distinguish it from any draft documents in your team’s File Exchange.
EVM 202
November 2017
Lesson 4-79
Earned Value (EV) Techniques Exercise
Period 0 is the baseline control account plan. This control account baseline is based on a six
period schedule and includes eight work packages (WPs). Each work package uses a specific
EV technique consistent with the Earned Value Management System (EVMS) description.
Given the cumulative actual cost of work performed (ACWPcum) and the updated milestone
charts, for each period calculate the:
Cumulative budgeted cost for work scheduled (BCWScum)
Cumulative budgeted cost for work performed (BCWPcum)
Cumulative cost variance (CVcum)
Cumulative schedule variance (SVcum)
Key:
Comp = Complete
LOE = Level of effort
MS = Milestone
EVM 202
November 2017
Lesson 4-80
EVM 202
November 2017
Lesson 4-81
EVM 202
November 2017
Lesson 4-82
EVM 202
November 2017
Lesson 4-83
Task Relationships Exercise
Identify the relationships between the tasks illustrated on the following network schedule.
EVM 202
November 2017
Lesson 4-84
Critical Path and Float Exercise
For the following network schedule, determine the critical path and note any poor scheduling practices.
EVM 202
November 2017
Lesson 4-85
Float and Duration Exercise
Using the following schedule, answer questions 1–5 for Task ID 523.
1. How much float is still available for this task?
2. Has this task improved, remained the same, or slipped? By how much?
3. Has the duration on this task decreased, remained the same, or increased?
4. Based on work progress, is this task ahead of, on, or behind schedule?
5. While none of these tasks are currently identified as critical, which task requires the most
immediate attention, and why?
EVM 202
November 2017
Lesson 4-86
Project X Exercise
Use the Project X Master Schedule to answer these questions.
1. Which tasks are summary level tasks (ID numbers)?
2. List the milestones (ID numbers).
3. Identify the critical path (ID numbers).
4. How does the current schedule of task ID 4 compare to its baseline?
a. It has improved from baseline.
b. It has remained the same.
c. It has slipped from baseline.
5. What has happened to the duration of task ID 4 in the current schedule when compared to
its baseline schedule?
a. Task duration has decreased.
b. Task duration is the same.
c. Task duration has increased.
6. What does the schedule indicate about the work progress of task ID 4?
a. Task is ahead of schedule in the current schedule.
b. Task is on schedule in the current schedule.
c. Task is behind schedule in the current schedule.
7. How does the current schedule of task ID 13 compare to its baseline?
a. It has improved from baseline.
b. It has remained the same.
c. It has slipped from baseline.
8. What has happened to the duration of task ID 13 in the current schedule when compared to
its baseline schedule?
a. Task duration has decreased.
b. Task duration is the same.
c. Task duration has increased.
9. As of the status date, what does the schedule indicate about the work progress of task ID
13?
a. Task is ahead of schedule in the current schedule.
b. Task is on schedule in the current schedule.
c. Task is behind schedule in the current schedule.
10. Compute the following DoD schedule metrics.
Hit Task %
Baseline Execution Index (BEI)
As of: Jul
15
EVM 202
November 2017
Lesson 4-87
EVM 202 Lesson 5:
EVMS Surveillance
STUDENT GUIDE
CONTENTS
1.
2.
3.
4.
Learning Objectives and Additional References
LAR Vehicle Scenario
Presentation Slides
Exercise Instructions
EVM 202
November 2017
Lesson 5-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 5-2
Learning Objectives and Additional References
Terminal Learning Objective
Describe the Earned Value Management System (EVMS) surveillance purpose and process.
Enabling Learning Objectives
•
•
•
•
•
Describe Department of Defense (DoD) policy related to EVMS surveillance
Describe the Defense Contract Management Agency (DCMA) surveillance process
Describe the DCMA Corrective Action Request (CAR) process
Describe EVMS noncompliance remediation options
Describe the working relationships of the Program Management Office (PMO) and
contractor in the surveillance process
Additional References
•
•
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) Earned Value Management (EVM)
Community of Practice (CoP)
DoD Memorandum “Use of Earned Value Management (EVM) in the Department of
Defense”
DCMA Standard Surveillance Instruction (SSI)
EVM 202
November 2017
Lesson 5-3
LAR Vehicle Scenario
Background
General Pratt, the new commandant for DCMA, needs to be updated on some of the agency’s
core competencies and processes. He read the Department of Defense (DoD) Earned Value
Management (EVM) Performance, Oversight, and Governance report to Congress regarding
EVM implementation across DoD program offices—and he is not pleased. The General is
yelling about the right item, right price, and right time stuff, and he wants some answers.
General Pratt has extensive contracting and program management experience, but he needs
your help bringing him up-to-speed on organizational roles and responsibilities for conducting
surveillance on Increda’s EVMS.
EVM 202
November 2017
Lesson 5-4
September 2016
EVM 202—Lesson 5 EVMS Surveillance
Lesson 5 Learning Objectives
Terminal Objective
• Describe the Earned Value Management System (EVMS)
surveillance purpose and process
Enabling Objectives
• Describe Department of Defense (DoD) policy related to
EVMS surveillance
• Describe the Defense Contract Management Agency (DCMA)
surveillance process
• Describe the DCMA Corrective Action Request (CAR) process
• Describe EVMS noncompliance remediation options
• Describe the working relationships of the Program
Management Office (PMO) and contractor in the surveillance
process
2
EVM 202
November 2017
Lesson 5-5
EVMS Surveillance Purpose
• Purpose of Surveillance—Surveillance is a recurring process
conducted by DCMA, Supervisor of Shipbuilding, Conversion and
Repair (SUPSHIP), or other cognizant Federal agency that
assesses the continuing compliance of the contractor’s EVMS
with Electronic Industries Alliance Standard-748 (EIA-748) and
the contractor’s written system documentation
• Policy—DCMA surveillance of management control systems is
required for all contract efforts ≥ 100M that require Earned Value
Management (EVM) compliance with the EIA-748
• Defense Federal Acquisition Regulation Supplement (DFARS)
clause 252.234-7002 establishes the contractual authority for
EVMS surveillance; requirement cannot be eliminated by PMO
3
DoDI 5000.02 EVM Policy Guidance
Enclosure 1 Table 8 EVM Application
Requirements
Contract Value
< $20M
≥ $20M & < $100M
≥ $100M
Applicability
EVM not required; may be
applied at PM discretion
based on risk to the
Government
EVM Required; contractor is
required to have an EVM
system (EVMS) that
complies with the guidelines
in EIA-748*
Notes
Source
Requires business case analysis and MDA
approval
The Government reserves the right to review a
contractor’s EVMS when deemed necessary to
verify compliance
Part 7 of OMB Circular
A-11 (Reference (c));
DFARS 234.201
(Reference (al)); This
The Contractor will provide access to all pertinent instruction
EVM Required; contractor is records and data requested by the Contracting
required to have an EVMS Officer or duly authorized representative as
that has been determined to necessary to permit initial and ongoing
be in compliance with the
Government compliance reviews to ensure that
guidelines in EIA-748*
the EVMS complies, and continues to comply,
with the guidelines in EIA-748*.
Additional Information
For ACAT ID and IAM programs, OSD USD(AT&L) Performance Assessments and Root Cause Analyses (PARCA), in
coordination with the CAE or designee, will review proposed contract work scope for EVM applicability and provide a
recommendation to the DAE/MDA for a determination of EVM applicability. For all other ACAT levels, the CAE, or designee, will
review and determine EVM applicability. If EVM is determined to apply, then threshold application in this table is utilized or a
waiver from the CAE is required. If, based on the nature of the work, EVM is determined not to apply, then EVM is not placed on
contract.
Applying EVM outside the thresholds and criteria above, to include application on firm, fixed-price (FFP) contracts, FFP task
orders, or FFP delivery orders, a cost-benefit analysis will be conducted, MDA approval is required, and the results provided to the
contracting officer for documentation in the contract file.
The term "contracts” includes contracts, subcontracts, intra-government work agreements, and other agreements.
For indefinite delivery, indefinite quantity (IDIQ) contracts, inclusion of EVM requirements is based on the estimated ceiling of
the total IDIQ contract, and then is applied to the individual task/delivery orders, or group(s) of related task/delivery orders, that
meet or are expected to meet the conditions of contract type, value, duration, and work scope. The EVM requirements should be
placed on the base IDIQ contract and applied to the task/delivery orders, or group(s) of related task/delivery orders. “Related”
refers to dependent efforts that can be measured and scheduled across task/delivery orders.
The Integrated Baseline Review is required when EVM is determined to be applicable.
The initiation of an over-target baseline or over-target schedule must be approved by the Government program manager.
Application thresholds are in then-year dollars.
* EIA-748 = Electronic Industries Alliance (EIA) 748-C (Reference (au))
EVM 202
November 2017
4
Lesson 5-6
Surveillance Verifies the EVMS
• Surveillance verifies:
– A contractor’s processes and procedures continue to satisfy the EIA748 EVMS guidelines
– A contractor’s processes and procedures are being followed
appropriately
– The validity of the contractor’s performance data provided to the
Government
5
EVMS Integrated Surveillance Team (IST)
• DCMA CMO
–
–
–
–
EVM Specialist
Program Support Team (PST)
Program integrator/support program integrator
Administrative Contracting Office (ACO)
• EVM Implementation Division (ID)
• PMO
• The contractor
6
EVM 202
November 2017
Lesson 5-7
DCMA EVM Surveillance Process
When surveillance is required, all 32 guidelines evaluated within a
three-year period
– Standard Surveillance Plan (SSP)—Developed by the EVM Specialist
• Minimum of four surveillance events per year
– Corrective Action Request (CAR)
7
EVMS Surveillance Plan
Surveillance Selection Risk
Matrix
Annual EVMS Surveillance
Schedule
• Formal DoD Program Office delegation is
NOT required
• An SSP is required
– Begins at contract award and runs throughout
the contract
– Uses a risk-based approach
– Requires quarterly surveillance covering all
guidelines over a 36-month period
– Requires surveillance results be documented
and communicated to stakeholders in a timely
manner
8
EVM 202
November 2017
Lesson 5-8
DCMA Standard CAR Process
CAR Severity
• Level I—Contractual non-compliance; no special management
attention required to correct; directed at supplier working level
• Level II—Systemic and could affect EVMS; directed to supplier
management level and copy sent to ACO
• Level III—Systemic and has affected EVMS and program
performance; directed to supplier top management at site;
contractual remedies possible
• Level IV—System has affected EVMS and multiple programs;
directed to supplier corporate management; issued as part of
contractual remedy notice
9
Remediation Flow Chart
Financial Remediation Actions*
•
Reduce or suspend progress payments
•
•
•
•
Reduce contractor billings
Reduce overhead billing rates
Reduce award fee (must be factor)
Negotiate a reduction in contract price
Management System Remediation Actions*
•
Review for cause/compliance review
•
Withdraw management system approval
Other*
•
•
•
•
•
Issue Cure Notice
Issue Show Cause Notice
Create EVM Oversight Group
Implement EVMS Senior Executive Review Board
Submit Contractor Performance Assessment Report (CPAR)
*Actions may be taken concurrently
Withdrawal applies only to efforts ≥ $100M TY
EVM 202
November 2017
10
Lesson 5-9
Remedies
• Focused Surveillance Review (FSR)
– May result from routine surveillance or a PMO concern for IPMR data
validity
– Purpose: To determine magnitude and systematic nature of concerns
• Review for Cause (RFC) Major Problem Identified
– Evaluates the contractor’s progress against the CAP
– Identifies remaining actions required to reaffirm system acceptability
– Ensure accuracy of performance data generated for Government
contracts
– Determines if the system approval should be withdrawn
11
EVM Roles and Responsibilities Exercise
• Review the EVM Roles and Responsibilities reference on
Blackboard:
–
–
–
–
Team A—DCMA
Team B—DCMA Earned Value Management Implementation Division (EVM ID)
Team C—Program Management Office (PMO)
Team D—Contractor
• Prepare a 5–10 minute briefing on your assigned role’s surveillance
responsibilities (use easel paper)
12
EVM 202
November 2017
Lesson 5-10
Lesson 5 Summary
• Terminal Learning Objective (TLO)
– Describe the EVMS surveillance purpose and process
• Enabling Learning Objective (ELO)
–
–
–
–
–
Describe DoD policy related to EVMS surveillance
Describe the DCMA surveillance process
Describe the DCMA CAR process
Describe EVMS noncompliance remediation options
Describe the working relationships of the PMO and contractor in the
surveillance process
13
EVM 202
November 2017
Lesson 5-11
Exercise Instructions
Group Task: EVM Roles and Responsibilities Exercise
(Use your whiteboard or easel paper for this exercise.)
Your team has 30 minutes to review all available references and come up with an organization
responsibility briefing. The General wants a table top brief. Review the “EVM Roles and
Responsibilities” reference on Blackboard.
All teams should be prepared to respond and brief the roles and responsibilities of their
assigned organization. Each table should plan for no more than 10 minutes; the General has a
full schedule today and time is an invaluable resource.
Team Assignments
•
•
•
•
Team A—DCMA
Team B—DCMA Earned Value Management Implementation Division (EVM ID)
Team C—Program Management Office (PMO)
Team D—Contractor
EVM 202
November 2017
Lesson 5-12
EVM 202 Lesson 6:
Integrated Program Management
Analysis Tools and Techniques
STUDENT GUIDE
CONTENTS
1. Learning Objectives and Additional References
2. LAR Vehicle Scenario
3. Presentation Slides
4. LAR Vehicle Program Control Book—DECEMBER 2016
5. Program Requirements Analysis Exercise
6. Notional Data Validity Check Exercise
7. EVM Chart Analysis Exercise
8. Price at Completion (PAC) Exercise
9. EVM Metrics Review Exercise
10. IPMR/CFSR Comparative Analysis Exercise
EVM 202
November 2017
Lesson 6-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 6-2
Learning Objectives and Additional References
Terminal Learning Objective
Given an Integrated Analysis Model, assess integrated program management data to make
informed recommendations to support program management decisions.
Enabling Learning Objectives
•
•
•
•
•
•
•
•
•
Explain key elements of an Integrated Analysis Model
Identify current program technical, cost, and schedule requirements
Assess Integrated Program Management Report (IPMR) data validity
Analyze data to determine technical, schedule, and cost drivers
Construct a realistic estimate at completion (EAC) and appropriate time-phased price at
completion (PAC)
Analyze the Integrated Master Schedule (IMS) to determine the ability to meet schedule
requirements
Explain the influence of Earned Value Management (EVM) analysis on budget and
program documents
Demonstrate if program funding/budget is consistent with the Contract Funds Status
Report (CFSR) and the time-phased Government PAC
Justify recommendations for program management decisions
Additional References
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
EVM 202
November 2017
Lesson 6-3
LAR Vehicle Scenario
Background
It is February 5, 2017. Issues identified at the Integrated Baseline Review (IBR) have been
resolved. COL Paine and GEN Moatars are very pleased with the Earned Value Management
(EVM) implementation progress made to date. They are especially excited about the Integrated
Product Team (IPT) concept taking hold in the Program Management Office (PMO). The
software tools, Empower and MS Project, are being greeted with great interest. However, many
of your IPT members are having difficulty reconciling all of the different inputs received from
Increda (e.g., schedules, technical assessments, IPMR data). The initial Program Management
Review (PMR) is scheduled at the end of the week. COL Paine wants you to help the IPT make
sense of all this information using the Integrated Program Management Model, which will help
you analyze past performance, forecast future performance, and formulate a plan of action.
Relevant Information
As part of DAWIA (Defense Acquisition Workforce Improvement Act) continuing education,
COL Paine has arranged for the Defense Acquisition University to provide a two-day refresher
course on the Integrated Program Management Model. DAU has incorporated Lightweight,
Assault and Reconnaissance (LAR) Vehicle Integrated Program Management Report (IPMR)
data, already submitted by Increda, into many of the training exercises to add a sense of reality
to the process.
EVM 202
November 2017
Lesson 6-4
September 2016
EVM 202—Lesson 6 Integrated Program Management
Analysis Tools and Techniques (Part 1)
EVM 202
November 2017
Lesson 6-5
Integrated Program Management Model
2
EVM 202
November 2017
Lesson 6-6
Lesson 6 Learning Objectives
Terminal Learning Objective (TLO)
• Given an Integrated Analysis Model, assess integrated
program management data to make informed
recommendations to support program management decisions
Enabling Learning Objectives (ELOs)
• Explain key elements of an Integrated Analysis Model
• Identify current program technical, cost, and schedule
requirements
• Assess Integrated Program Management Report (IPMR) data
validity
• Analyze data to determine technical, schedule, and cost
drivers
• Construct a realistic estimate at completion (EAC) and
appropriate time-phased price at completion (PAC)
• Analyze the Integrated Master Schedule (IMS) to determine
the ability to meet schedule requirements
• Explain the influence of EVM analysis on budget and program
documents
• Demonstrate if program funding/budget is consistent with the
Contract Funds Status Report (CFSR) and the time-phased
Government PAC
• Justify recommendations for program management decisions
3
EVM 202
November 2017
Lesson 6-7
Acquisition Contracts and Oversight Reports
4
EVM 202
November 2017
Lesson 6-8
Integrated Program Management
RISK
• System Engineering
• Simulation and Test
• Design Reviews
• TPMs
• EVM BCWP
(Earned Value)
• Critical Path Schedules
• Monte Carlo Schedule
Simulations
• Program Reviews
• EVM BCWS
(Time-Phased Budget)
•
•
CFSR, CSDR, WBS,
Cost Estimates
EVM BAC, ACWP, and
EAC (Actuals and
Forecast Cost)
5
EVM 202
November 2017
Lesson 6-9
LAR Vehicle Data Package
• Why:
– You must have the proper data before you can do analysis.
• What You Need:
– Initial Capability Document (ICD), Capability Development Document
(CDD), and Capability Production Document(CPD)
– Acquisition Program Baseline (APB)
– Contract
– Integrated Program Management Report (IPMR)  Earned Value (EV)
and Critical Path
– Contract Funds Status Reports (CFSR)
– R&P Budget Forms
– Defense Finance and Accounting Services (DFAS) Obligation and
Expenditure Report
– Defense Contract Management Agency (DCMA) Surveillance Reports
• Where Can You Get It?
–
–
–
–
–
–
–
–
ICD/CDD/CPD  Program Office
APB  Program Office
Contract  Program Office
IPMR  EVM Central Repository
CFSR  EVM Central Repository
R&P Forms  http://comptroller.defense.gov/
DFAS Obligation and Expenditure Report  DFAS
DCMA Surveillance Reports  Program Integrator and EVMS Monitor
6
EVM 202
November 2017
Lesson 6-10
Program Requirements Analysis
• Why:
– To identify and understand the Key Performance Parameters (KPPs)
needed to demonstrate the technical maturity, affordability, and
programmatics required to progress to the next acquisition milestone
– To identify and ensure that the contract requirements fully support the
warfighter’s requirements—the APB parameters
• What:
– Review the KPPs for technical, cost, and schedule requirements; the
Capability Development Document (CDD) and Capability Production
Document (CPD) define the KPPs, which are included verbatim in the
Acquisition Program Baseline (APB)
– Evaluate contract specification and delivery requirements
• How:
– Review the APB to identify and understand the threshold and objective
goals for each performance, cost, and schedule KPP
– Identify contract technical requirements
– Identify contract delivery requirements
7
EVM 202
November 2017
Lesson 6-11
Program Requirements Analysis Exercise
Instructions
1. Using the LAR March 2016 APB,
review and identify the LAR Vehicle
threshold and objective KPP values
required for a production and
deployment decision. (See the LAR
Data Package.)
2. Identify any discrepancies of these
values with the LAR Vehicle
contract requirements.
Team Whiteboard Assignments
• Team A—APB Performance KPPs
(Survivability and Grade)
• Team B—APB Performance KPPs
(Turning Radius and Range)
• Team C—APB Schedule Parameters
• Team D—APB Cost Parameters
8
EVM 202
November 2017
Lesson 6-12
Integrated Program Analysis Model
Contract Level
1.
Analyze Past Performance
1.1 Validate Data
1.2 Analyze PMB
1.3 Analyze Technical Risk Drivers
1.4 Analyze Schedule Drivers
1.5 Analyze Cost Drivers
2.
3.
Predict Future Performance
Formulate a Plan of Action
9
EVM 202
November 2017
Lesson 6-13
STEP 1 ANALYZE PAST PERFORMANCE
• By analyzing past performance, the EVM analyst and the
Integrated Product Teams (IPTs) lay the groundwork to help
predict future performance. Both of these activities are
essential inputs to formulating a plan of action.
• Thus, the model can be thought of as an integrated whole,
with the three activities occurring in on overlapping manner.
10
EVM 202
November 2017
Lesson 6-14
STEP 1.1 VALIDATE DATA
11
EVM 202
November 2017
Lesson 6-15
Step 1.1 Validate Data (Cont.)
• Why: To determine if the actual data represents the real
program status
• What and How:
– Earned Value Management System (EVMS) check
– IPMR data validity analysis
– Schedule validity analysis, i.e., schedule healthmetrics
12
EVM 202
November 2017
Lesson 6-16
Step 1.1—EVMS Check
EVMS Indicator
• Determines if the contractor’s EVMS has been approved and
continues to generate reliable information
– Contractor’s EVMS approved?
– Obtain all open corrective action requests (CARs)?
– Impact of outstanding CARs?
• System indicator issues: System not approved, no
surveillance, and/or Level 3 and 4 CARs
Baseline Indicator
• Assesses the risk of the baseline plan and risks identified
during the Integrated Baseline Review (IBR) process
– IBR conducted within 180 days?
– IBR assessed all five IBR risk categories: cost, schedule, technical,
resource, and management processes?
– Any risk rated high/red at IBR?
– High/red risks mitigated or EAC increased to reflect risk as
appropriate?
• Baseline indicator issues: IBR not conducted, all five risk
categories not evaluated, and/or high/red risks not mitigated or
accounted for in EAC
13
EVM 202
November 2017
Lesson 6-17
STEP 1.1—IPMR DATA VALIDITY
ANALYSIS
14
EVM 202
November 2017
Lesson 6-18
Open Empower Dataset
1.
2.
3.
4.
5.
6.
7.
Open your browser and enter the URL
https://encore.dau.mil.
Select Empower under Data Source.
Enter the user name and the password provided.
Select Dataset.
Select LAR EMD 2016, DEC 16, WBS, and Dollars.
Select OK.
Close the Open Dataset dialog box.
15
EVM 202
November 2017
Lesson 6-19
Screen Layout
1.
2.
3.
4.
5.
Empower opens in the Standard View in the tri-pane layout
based upon the Dataset selections.
The Status Bar indicates the selected contract, month,
structure, unit, element, and the sort/filter status.
The Menu Bar provides access to charts, reports, and other
features.
The Toolbar provides shortcuts to commonly used features.
Select a row in the Sort Window to update a report/chart to
the desired element.
16
EVM 202
November 2017
Lesson 6-20
Screen Layout—Text Only View
1.
2.
3.
4.
5.
Empower opens in the Standard View in the tri-pane layout
based upon the Dataset selections.
The Status Bar indicates the selected contract, month,
structure, unit, element, and the sort/filter status.
The Menu Bar provides access to charts, reports, and other
features.
The Toolbar provides shortcuts to commonly used features.
Select a row in the Sort Window to update a report/chart to
the desired element.
17
EVM 202
November 2017
Lesson 6-21
WBS Format
• The WBS View displays Format 1 (WBS) elements.
18
EVM 202
November 2017
Lesson 6-22
OBS Format
• The OBS View displays Format 2 (OBS) elements.
19
EVM 202
November 2017
Lesson 6-23
IPT Format
• The IPT View displays IPT elements.
20
EVM 202
November 2017
Lesson 6-24
Lowest Level
• Toggle the Lowest button to display alternates between all of the
WBS elements and the lowest level WBS elements.
• The Layout button is used to return Empower to the tri-pane
layout, with the three windows appropriately resized to fill the
browser window. In Internet Explorer, you may also press the
Refresh button.
21
EVM 202
November 2017
Lesson 6-25
Sort Column
• Select a column to sort:
– Select a column header to sort descending.
– Select the same column again to sort ascending. Note in the sample
below it is sorted by CV ascending.
• The Status Bar indicates if the sort is ascending or descending.
Important: Return to the original sort by selecting the top of the
HIER column (hierarchical sort). After navigating Empower, you
may be a little lost and want to return to the original parent-child
sort. In this example, the lowest toggle is turned off; it is sorted by
WBS hierarchy. The hierarchy values are calculated by Empower.
22
EVM 202
November 2017
Lesson 6-26
Interactive Filter/Go To Element
• Interactive Filter—Enter parameters into the filter boxes of each
column.
• Use the Clear button to remove all filter parameters.
Note: Filter parameters are executed with an ‘and’ clause. The
above sort window shows lowest level elements between 5% and
95% complete with a CV of less than -100, with a CV sort.
Text fields are executed as ‘begins with’ and number fields support
the following parameters:
• Numbers: Equal to: = N, Greater than: > N, Less than: < N, Less
or equal: <= N. Greater or equal: >= N, Range of values: N1 ..
N2
• Text fields: Execute as a “begins with”
• Go to Element—Enter the complete element number in the
interactive filter.
23
EVM 202
November 2017
Lesson 6-27
Empower Standard View
• The following shows the contract WBS with SV, CV, and VAC
stoplight colors and trends. The cell colors are based upon SV%,
CV%, VAC%, and the thresholds shown in item 3 below.
Up Arrow = Improving
Down Arrow = Declining
Sideways Arrow = No
Significant Change
• Open Options > Show
Thresholds for a key to the
colors and arrows. The arrows
change for an element if there
has been a 10% change in the
variance for the previous
month.
24
EVM 202
November 2017
Lesson 6-28
Contractual Thresholds
• The VAR (Variance Analysis Reporting Threshold) column
indicates what categories have exceeded the reporting
thresholds. For the LAR, we have set + or - 10% thresholds.
Exceeding triggers normally requires an narrative explanation
in Format 5 of the IPMR.
• Small letters indicate a current month breach; capital letters
indicate a cumulative breach. C/c is for cost, S/s is for
schedule, and V is for VAC.
25
EVM 202
November 2017
Lesson 6-29
Validity Report
LAR EMD December 2016 WBS Dollars [1 : LAR]
Validity Report
• The Validity Report is an artificial intelligence report that
reconciles the different IPMR formats as submitted by the
contractor.
• This is a good place to begin any analysis; basic checks are
already done for you automatically. You must have confidence
in the data to draw conclusions about the health of the contract.
▲ WARNING
Formula
EAC is optimistic
CVCUM < VAC
TCPIEAC - CPICUM > 0.10
EAC < CPI Forecast
Format 3 PM EOP does not equal
Format 1 BAC subtotal (PMB)
BAC - MR BAC - F3 PM EOP > 0
Format 3 BOP PMB does not equal
previous period's F3 EOP PMB
F3 BOP (cp) - F3 EOP (cp-1) > 0
Format 3 BCWSCUM does not equal
Format 1 BCWSCUM
F3 BCWSCUM - F1 BCWSCUM > 0
Format 3 BOP (total), plus changes,
does not equal F3 EOP (total)
F3 BOP (total) + SUM(BL Changes) F3 total EOP (total) > 0
26
EVM 202
November 2017
Lesson 6-30
AI Narrative
• To obtain a quick summary, select Reports > AI Narrative.
• The AI Narrative is a computer-generated report where
numerical data is translated into sentences; rule-based logic is
used to generate the words. The report provides analyses in
four areas: Summary; Performance to Date, EAC Analysis,
and OSD Metrics. Note: Only a subset of the OSD Metrics are
checked in the AI Narrative Report.
27
EVM 202
November 2017
Lesson 6-31
Notional Data Validity Check Exercise
Complete the last two columns of this chart. Put 1 in the third
column if the data needs to be corrected. Provide a brief
explanation of your answer in the Notes/Actions column.
Validity Check
Checks for
1
100% Complete
ACWP ≠ EAC
Elements 100% complete,
but EAC not equal to
cumulative actual cost
ACWP > LRE
Elements with cumulative
actual cost greater than
LRE
ACWP > BAC
Elements where cumulative
actual cost exceeds BAC
ACWP increase
without BCWP
increase
For the current period, there
is ACWP with no BCWP
BCWP increase
without ACWP
increase
For the current period, there
is BCWP with no ACWP
BCWP > BAC
Elements where BCWP
exceeds BAC
BCWS > BAC
Elements where BCWS
exceeds BAC
CV < VAC
(EAC realism)
Elements where CVCUM is
negative, VAC is greater
than CVCUM
TCPI-LRE –
CPICUM = ±0.10
(EAC realism)
Elements where TCPI-LRE
differs from CPICUM by more
than ±.10
1. Need Correction
EVM 202
Notes/Actions
2. Need Investigation
November 2017
28
Lesson 6-32
Step 1.1—Schedule Health Metrics
LAR Schedule
Value Potential Impact
Missing Logic
3%
Hard Constraints
(Tasks w/
Constrained
Dates)
< 1% Tasks should rarely be artificially tied to dates. Durations combined
with schedule logic should determine schedule dates. Use of
constraints may result in incorrect calculation of the critical path and
near critical paths.
High Float
71%
High Duration
38% Industry consensus is that near term tasks should be a week to a
month in length. When more than a month, you will not be able to
get an accurate estimate of progress and forecasted completion
dates. Tasks w/ Duration > 44 days
Baseline Execution
Index (BEI)
0.87
EVM 202
Almost every task should have a predecessor and successor
Large positive or negative slack values may indicate a poorly
constructed schedule. Large positive slack may indicate poor or
missing logic. Tasks w/ Total Slack > 44 days
This measure the tasks that were completed as a percentage of the
tasks that should have been completed per the original (baseline)
plan. The goal is to have a BEI of .95 or greater.
29
November 2017
Lesson 6-33
STEP 1.2 ANALYZE PMB
30
EVM 202
November 2017
Lesson 6-34
Step 1.2—PMB Analysis
• Why: To determine that the PMB is current and that the
contractor is “using EVM to manage” and not “managing the
earned value (EV) data”
• What: Assess the IPMR baseline data to ensure that contract
modifications are incorporated, that the PMB is updated to
address cost and schedule variances, and that PMB
adjustments have not invalidated EVM metrics
• How:
– IPMR analysis and contract modification and baseline revision metrics
• Format 3 Review—Identify PMB Changes
• Format 5 Review—Contractor explains PMB changes
– Empower Contract Level 1: EAC Chart and Six Period Summary
– Empower Undistributed Budget (UB): EAC Chart and Six Period
Summary
– Empower PMB: EAC Chart and Six Period Summary
– Empower Management Reserve (MR): EAC Chart and Six Period
Summary
– Single Point Adjustments (SPAs) and Over Target Baselines (OTBs)
– Has the PMB been maintained and does it accurately reflect program
and contract status?
31
EVM 202
November 2017
Lesson 6-35
Contract Modification and
Baseline Revisions
Contract Modification Metric
• Highlights changes made to the contract dollar value from the
time of award to the present
• Identifies when new requirements have been added to the
contract or when existing requirements have been modified
• Highlights whether or not requirements are clearly understood
• A delta ≥ 10% used as an early warning indication that the
program’s technical requirements are possibly not entirely
understood
Baseline Revisions Metric
• Highlights changes made to the time-phased PMB over the
past 13-month period using the IPMR Format 3
• Adelta ≥ 5% used as an early warning indication for volatility
in the near-term plan
32
EVM 202
November 2017
Lesson 6-36
Format 3 Review
1.
Format 3 Box 5 Contract Data—IMPORTANT
•
•
•
•
2.
Lists all negotiated and authorized contractmodifications
Lists the value of OTBs
Lists contractor’s estimated completion date
Should correlate contract P0000 status
Format 3 Box 6 Performance Data
• Block 15—UB; should be zero
• Block 16—Shifts in total budget; can only come from OTB, MR, or new
work
3.
Format 3 Box 7—MR
33
EVM 202
November 2017
Lesson 6-37
Format 5 Explanations and Problem
Analyses Review
•
•
•
•
•
•
Contract summary
Formal reprogramming analysis
EAC analysis
UB analysis
MR analysis
IMS discussion:
–
–
–
–
Critical/driving paths
Baseline schedule variance
Schedule margin changes
Schedule health analysis, if applicable
• Format 3 discussion/changes
• Format 4 discussion/changes
• Cost and schedule variance
analysis:
–
–
–
–
–
•
Root cause
Effects on immediate tasks
Impacts on the total contract
Corrective actions
Base labor rate, material price,
and overhead rate changes
Supplemental discussion
34
EVM 202
November 2017
Lesson 6-38
Contract Modification Metric (Format 3)
Contract Mod =
IPMR3 5e - IPMR3 5a
IPMR3 5a
x 100 =
647,115 -647,115
x 100 = 0%
647,115
Contract Modification Metric = 0.0 Percent
Warning indicator: Change ≥ 10%
EVM 202
November 2017
35
Lesson 6-39
Baseline Revisions Metric (Format 3)
Baseline Revisions Metric = 31.80 Percent
Warning indicator: Change ≥ 5%
EVM 202
November 2017
36
Lesson 6-40
Has the Contract Budget Base (CBB)
Changed?
1.
2.
3.
4.
5.
6.
How can you tell if the CBB has changed?
The Empower Level 1 EAC Chart will tell you.
Go to WBS Level 1 and select LAR > Charts > EAC. Make
sure that you are at the LAR Vehicle program level; the
status bar must read LAR.
Unique to Empower, the BAC at level 1 is the CBB because
it includes MR. Empower assumes MR will be consumed in
level 1 charts and reports; the EAC calculations (e.g.,
CPICUM forecast) use CBB instead of PMB.
Small value changes in the charts are not obvious at the
contract level.
Example: In MAY 2017, there was a $65.4K contract
modification, but it is too small to see on this JUL 2017 EAC
chart.
37
EVM 202
November 2017
Lesson 6-41
LAR Vehicle Level 1 Six Period Summary
LAR EMD July 2017 WBS Dollars [1 : LAR]
Six Period Summary (Millions)
38
EVM 202
November 2017
Lesson 6-42
LAR Vehicle UB EAC Chart
1.
2.
3.
4.
Small contract changes can be very obvious in UB account.
From Sort Window, scroll to the bottom of the Sort Window
until you see UNDIST BUDGET.
Select UNDIST BUDGET (Undistributed Budget - UB).
Make sure the status bar changes to UB. Now all charts and
reports will be for UB. Select Charts > EAC.
Remember that the CBB includesAuthorized Unpriced Work
(AUW). AUW normally first enters the PMB as UB. As the
work is definitized, the UB BAC is allocated to the control
accounts (CAs), is lowered as a result of contract
negotiations, and/or is added to MR.
39
EVM 202
November 2017
Lesson 6-43
LAR Vehicle UB Six Period Summary
LAR EMD July 2017 Dollars [UB]:
UNDIST BUDGET
Six Period Summary (Millions)
40
EVM 202
November 2017
Lesson 6-44
LAR Vehicle PMB EAC Chart
1.
2.
3.
4.
5.
Continuing to track the May 2017 modification, review the
PMB.
From Sort Window, scroll to the bottom of the Sort Window
and select PERF MEASURE BL. (Check the status bar.)
Now all charts and reports will be for PMB. Select Charts >
EAC.
In this chart, BAC represents the PMB for July 2017.
If a contractor is using EVM to manage, we expect the PMB
line to change month to month (e.g., rolling wave planning,
contract modifications, MR).
The May contract modification does not appear to be
reflected in the PMB. Where’s the money?
41
EVM 202
November 2017
Lesson 6-45
LAR Vehicle MR EAC Chart
1.
2.
3.
4.
5.
The Empower MR EAC Chart shows the movement of
budget in and out of MR.
From Sort Window, scroll to the bottom of the Sort Window
until you see MGT RESERVE. Select MGT RESERVE
(Management Reserve - MR). (Check the status bar.)
Select Chart > EAC.
In this chart, the BAC represents the remaining MR.
If a contractor is using EVM to manage, we expect the MR
line to change month to month, e.g., subcontracts,
negotiations, rolling wave planning, and unknown unknowns.
Is the May contract modification in MR?
42
EVM 202
November 2017
Lesson 6-46
LAR Vehicle PMB SPA and OTB Chart
1.
2.
3.
4.
5.
Review the PMB for possible SPA and OTB.
From Sort Window, scroll to the bottom of the Sort Window
and select PERF MEASURE BL. (Check Status Bar.) Now
all charts and reports will be for the PMB. Select Charts >
EAC.
In this chart, the BAC represents the current PMB.
In June 2018, an OTB is established. BCWP and BCWS are
set equal to ACWP. $44.4M is added to the PMB to complete
the work. Zeroing the variances results in LRE, BAC, and
CPICUM convergence.
If an OTB exists, EVM metrics must be evaluated in the
context of the OTB.
43
EVM 202
November 2017
Lesson 6-47
STEP 1.3 ANALYZE TECHNICAL RISK
DRIVERS
44
EVM 202
November 2017
Lesson 6-48
Step 1.3—Technical Risk Drivers Analysis
• Why: To answer the question: Will the program achieve the
APB technical requirements, have military utility, and meet the
needs of the warfighter?
• What: The systems engineering process: Develop and status
technical risk metrics needed to quantify technical progress
and manage technical risk elements
• How:
–
–
–
–
–
Review risk assessment
Evaluate technical performance status
Identify technical drivers
Correlate actual performance data with APB performance goals
Correlate actual performance data with contract specification
requirements
– Review information and analyses presented at status and design
reviews
– Review IPMR Format 5
– Identify technical risk issues
45
EVM 202
November 2017
Lesson 6-49
LAR Vehicle TPM Status, December 2016
• Fuel Consumption: Outside the bound of the development plan,
no improvement since June, impacting Range KPP
• IR Signature: Analysis value at the upper tolerance level,
impacting Survivability KPP
46
EVM 202
November 2017
Lesson 6-50
LAR Vehicle Technical Performance
KPPs Driving WBS Element Technical Risk
• Survivability: Body/Cab, Testing, Power Package (IR Signature),
and Communications
• Grade and Range: Power Package
• Turning Radius: Suspension/Steering and Armament
• Gross Vehicle Weight: Power Package, Armament, Body/Cab,
and Auxiliary Equipment
Current Performance Status, December 2016
• Survivability: 0.97
• Grade: 40o
• Range: 385 Miles
• Turning Radius: 25 Ft
• Combat Vehicle Weight: 13,000 KGs
47
EVM 202
November 2017
Lesson 6-51
STEP 1.4 ANALYZE SCHEDULE
DRIVERS
48
EVM 202
November 2017
Lesson 6-52
Step 1.4—Schedule Drivers Analysis
• Why: To answer the question: Will the program be delivered on
time to meet the APB schedule requirements, the contractual
delivery requirements, and the needs of the warfighter?
• What: Determine schedule drivers using IMS analysis and EVM
schedule variances.
• How:
– Analyze IMS
• Analyze critical path
– Filter MS Project for critical path
• Assess slipping tasks
– Compare days slipped with total float
– Filter MS Project for slipping tasks
• Analyze network schedule for milestones
– Check against APB and contract requirements
– Filter MS Project for milestones
• Collect BEI and Hit-Task Percentage metrics (from Step 1.1)
– Analyze EVM schedule data at lowest level
• Sort by SV$
• Sort by SV%
– Review IPMR Format 5
49
EVM 202
November 2017
Lesson 6-53
Identify Critical Path
1.
2.
3.
4.
5.
Add the Predecessor and Successor columns.
Hide Summary Tasks by selecting the corresponding checkbox onthe
Format tab.
Select Critical from the View tab’s Filter drop-down menu (this filters for
tasks with a float value of 0 or less).
Insert Start column and then sort by Start Date (earliest to latest) to find
the first task on the critical path.
Any schedule item colored red is critical and has a float value of 0 or less.
50
EVM 202
November 2017
Lesson 6-54
Identify Critical Path (Cont.)
6.
Review the LAR Vehicle program critical path WBS elements.
What tasks are on the critical path to the next two milestones?
– Exhaust to Subsystem CDR
– Engine to System CDR
51
EVM 202
November 2017
Lesson 6-55
Critical Path Discussion
Evaluate the Empower and MS Project schedule data for December
2016 and answer the questions below.
1.
2.
3.
4.
What two tasks are on the critical path?
Has either of these tasks been completed?
Has either of these tasks started?
Does the Empower data correlate with the MS Project data?
52
EVM 202
November 2017
Lesson 6-56
Slipping Task Filter
1.
2.
3.
From the View drop-down menu, select Filter for > More
Filters > Slipping Tasks from the pop-up window.
Identify tasks with projected end dates later than their baseline
finish, particularly if they are on the critical path. If they are not
on critical path, how much float do they have? Are they close to
the critical path?
Review other filters: Completed Tasks, In Progress Tasks,
and Incomplete Tasks.
53
EVM 202
November 2017
Lesson 6-57
Float and Duration Exercise
• Compare float, duration, slip, and work progress to identify
near critical path tasks and tasks with questionable status.
• Float and slip time are work days (five-day weeks).
• MS Project selects the longest float of sub-elements for the
summary float.
54
EVM 202
November 2017
Lesson 6-58
Milestone Assessment
1.
2.
3.
4.
From the View drop-down menu, select Filter for > Milestones
and find the dates for the remaining milestones.
Compare the milestone dates in the IMS with the information
from your network schedule analysis to see if you think these
dates might be off.
Compare the IMS and the adjusted milestone dates with the
APB schedule parameters. Are there potential issues?
Compare the project milestone dates with the contract delivery
requirement dates. Are there potential contract delivery issues?
Milestone
APB
Objective
APB
Threshold
Contract
Dec 16
IMS
Issue
Subsystem
CDR
Jan 17
May 17
Feb 17
31 May 17
APB—No; at
threshold
Contract—Yes
System
CDR
Sep 17
Dec 17
Sep 17
31 Dec 17
APB—No; at
threshold
Contract—Yes
Production
Prototype
Delivery
Jul 18
Dec 18
Nov 18
14 Nov 18
APB—No; at
threshold
Contract—No
55
EVM 202
November 2017
Lesson 6-59
Drill Down Button with Sort
1.
2.
Select the Level 1 element.
Select Drill button.
a.
3.
4.
Note: Drill Up, Down, and Off buttons now displayed on toolbar
The Sort Window displays only level 2 elements (i.e., children
of level 1).
Select the Sort column.
Use this feature to drill up and down the tree. Select the Sort
column to bring the CV, SV, or VAC drivers to top.
EVM 202
November 2017
56
Lesson 6-60
Schedule SV$ Analysis
1.
2.
3.
4.
Select the Lowest Level button.
Sort for SV$. This identifies the WBS elements with the most
unfavorable SV in dollars. Note: Small dollar accounts may not
be seen in a SV$ account.
Do the WBS elements with the most unfavorable SV$ correlate
with the technical drivers? If not, why not?
Do the WBS elements with the most unfavorable SV$ correlate
with the critical path? If not, why not?
Technical
Drivers
IMS Analysis
SV$
Correlates With
1
Engine
Exhaust to SSCDR
Armament
Technical Driver
2
Cooling
Body/Cab & Engine Body/Cab
to Sys CDR
Technical Driver
3
Exhaust
IAT&C, Data, &
Spares to PPD
Susp/Str
Technical Driver
4
Susp/Str
System T&E to
DT/OT
System Eng
5
Armament
Susp/Str, slipping
Frame
6
Body/Cab
Armament, slipping
Project Mgmt
Element
Ranking
EVM 202
November 2017
57
Lesson 6-61
Schedule SV% Analysis
1.
2.
3.
Sort for SV%. This identifies the WBS elements with the most
unfavorable SV%. Note: Empower treats all accounts equally.
Do the WBS elements with the most unfavorable SV%
correlate with the technical drivers? If not, why not?
Do the WBS elements with the most unfavorable SV%
correlate with the critical path? If not, why not?
Technical
Drivers
IMS Analysis
SV%
1
Engine
Exhaust to SSCDR
Integ & Assem
2
Cooling
Body/Cab & Engine Aux Auto
to Sys CDR
3
Exhaust
IAT&C, Data, &
Spares to PPD
Electronics
4
Susp/Str
System T&E to
DT/OT
Body/Cab
Technical Driver
5
Armament
Susp/Str, slipping
Susp/Str
Technical Driver
6
Body/Cab
Armament, slipping
Armament
Technical Driver
Element
Ranking
EVM 202
November 2017
Correlates With
58
Lesson 6-62
Format 5 Review—Schedule Drivers
• Format 5—The IPMR DID requires analyses of cost and
schedule variances subject to tailoring:
–
–
–
–
Nature of problem
Effect on immediate task
Impact on total contract
Corrective actions taken or planned
• Format 5 tailoring variance analysis thresholds:
–
–
–
–
–
Fixed number of variances
Percent or dollar
Schedule
Specified variances
No thresholds specified
59
EVM 202
November 2017
Lesson 6-63
Determine Schedule Drivers
• There are no absolute ways to identify schedule drivers:
–
–
–
–
Review the technical drivers
Identify the elements on the critical path
Sort by SV$ and SV%
Compare all elements to identify the schedule drivers
• An analyst must be able to explain and defend their selections.
Element
Ranking
Technical
Drivers
IMS
Analysis
SV$
SV%
Schedule
Drivers
1
Engine
Exhaust to
SSCDR
Armament
Int &
Assembly
Engine
2
Cooling
Body/Cab &
Engine to
Sys CDR
Body/Cab
Aux Auto
Exhaust
3
Exhaust
IAT&C,
Data, &
Spares to
PPD
Susp/Str
Electronics Armament
4
Susp/Str
System T&E System
to DT/OT
Eng
Body/Cab
Int &
Assembly
5
Armament
Susp/Str,
slipping
Frame
Susp/Str
Susp/Str
6
Body/Cab
Armament,
slipping
PM
Armament
Body/Cab
60
EVM 202
November 2017
Lesson 6-64
STEP 1.5 ANALYZE COST DRIVERS
61
EVM 202
November 2017
Lesson 6-65
Step 1.5—Cost Drivers Analysis
• Why: To assess the actual cost performance (e.g., overruns
and underruns) and to correlate this data with the network
schedule, technical risk issues, and schedule drivers to
identify the cost drivers
• What: Determine cost variance metrics for all WBS elements;
correlate these EVM metrics with the technical drivers,
network schedule, and schedule drivers to determine the
program cost drivers
• How:
– Analyze EVM cost data at lowest level
• Sort by CV$
• Sort by CV%
– Correlate EVM cost metrics with technical drivers, critical path tasks,
and schedule drivers
– Review IPMR Format 5
62
EVM 202
November 2017
Lesson 6-66
Cost CV$ Analysis
1.
2.
3.
4.
Sort for CV$. This identifies the WBS elements with themost
unfavorable CV.
Do the WBS elements with the most unfavorable CV$ correlate with
the technical drivers? If not, why not?
Do the WBS elements with the most unfavorable CV$ correlate with
the critical path? If not, why not?
Do the WBS elements with the most unfavorable CV$ correlate with
the schedule drivers? If not, why not?
Element Technical IMS Analysis
Ranking Drivers
Exhaust to
1
Engine
SSCDR
2
Cooling
Body/Cab &
Engine to Sys
CDR
3
Exhaust
IAT&C, Data, &
Spares to PPD
4
Susp/Str
System T&E to
DT/OT
5
Armament Susp/Str, slipping
6
Body/Cab
Armament,
slipping
Schedule
Drivers
Engine
CV$
Correlates With
Exhaust
Armament
Technical Driver, SV$,
SV%
Armament
Susp/Str
Technical Driver, SV$,
SV%
System Eng SV$
Int & Assbly G&A
Susp/Str
Cooling
Body/Cab
Engine
Technical Driver,
Slipping Task
Technical Driver,
Critical Path, Schedule
Driver
63
EVM 202
November 2017
Lesson 6-67
Cost CV% Analysis
1.
2.
3.
4.
Sort for CV%. This identifies the WBS elements with themost
unfavorable CV%.
Do the WBS elements with the most unfavorable CV% correlate with
the technical drivers? If not, why not?
Do the WBS elements with the most unfavorable CV% correlate with
the critical path? If not, why not?
Do the WBS elements with the most unfavorable CV% correlate with
the schedule drivers? If not, why not?
Element Technical IMS Analysis
Ranking Drivers
1
Engine
Exhaust to
SSCDR
2
Cooling
Body/Cab &
Engine to Sys
CDR
3
Exhaust
4
Susp/Str
5
6
Armament Susp/Str, slipping
Body/Cab Armament,
slipping
IAT&C, Data, &
Spares to PPD
System T&E to
DT/OT
Schedule
Drivers
Engine
CV%
Correlates With
Aux Auto
SV%
Exhaust
Electronics
SV%
Armament
Cooling
Technical Driver,
Slipping Task, CV$
Technical Driver,
Critical Path, Schedule
Driver, CV$
Int & Assbly Engine
Susp/Str
Body/Cab
Mgmt Data
Susp/Str
Technical Driver,
Slipping Task, SV$,
SV%, Schedule Driver,
CV$
64
EVM 202
November 2017
Lesson 6-68
Format 5 Review—Cost Drivers
• Format 5—The IPMR DID requires analyses of cost and
schedule variances subject to tailoring:
–
–
–
–
Nature of problem
Effect on immediate task
Impact on total contract
Corrective actions taken or planned
• Format 5 tailoring variance analysis thresholds:
–
–
–
–
–
Fixed number of variances
Percent or dollar
Schedule
Specified variances
No thresholds specified
65
EVM 202
November 2017
Lesson 6-69
Determine Cost Drivers
• There are no absolute ways to identify cost drivers:
–
–
–
–
–
Review the technical drivers
Identify risk elements from IMS analysis
Review schedule drivers
Sort by CV$ and CV%
Compare all elements to identify cost drivers
• An analyst must be able to explain and defend their selections.
Element Technical IMS
Ranking Drivers
Analysis
Schedule
Drivers
CV$
CV%
Cost
Drivers
1
Engine
Exhaust to
SSCDR
Engine
System Eng Aux Auto
System
Eng
2
Cooling
Body/Cab &
Engine to
Sys CDR
Exhaust
Armament
Electronics
Engine
3
Exhaust
IAT&C, Data, Armament
& Spares to
PPD
Susp/Str
Cooling
Armament
4
Susp/Str
System T&E
to DT/OT
Int & Assbly G&A
Engine
Susp/Str
5
Armament Susp/Str,
slipping
Susp/Str
Cooling
Mgmt Data
Cooling
6
Body/Cab
Body/Cab
Engine
Susp/Str
Aux Auto
Armament,
slipping
66
EVM 202
November 2017
Lesson 6-70
Step 1—Analyze Past Performance
Summary
• Step 1: Analyze Past Performance is comprised of five substeps:
–
–
–
–
–
Step 1.1—Validate data
Step 1.2—Analyze PMB
Step 1.3—Analyze technical risk drivers
Step 1.4—Analyze schedule risk drivers
Step 1.5—Analyze cost risk drivers
• Analyzing past performance prepares the EVM analyst and
the IPTs for Step 2: Predict Future Performance, and both
steps are critical inputs for Step 3: Formulate a Plan of Action.
67
EVM 202
November 2017
Lesson 6-71
STEP 2 PREDICT FUTURE
PERFORMANCE
• The EVM analyst and the IPTs focus on predicting the future
by looking at:
–
–
–
–
Trend data
Future tasks
Effort in the Integrated Master Schedule (IMS)
Updated risk assessments
• One of the key outputs of the analysis is an update to the
program's estimate at completion (EAC). The updated EAC
can be compared to the obligation profile to determine if
funding is sufficient for the contract effort at any given time.
68
EVM 202
November 2017
Lesson 6-72
Step 2—Predict Future Performance
(Cont.)
• Why: To answer the question: Where are we going and when
will we be done? After analyzing past performance, future
tasks, and risks, CAMs generate EACs. Understanding EAC
reasonableness provides for effective program management
for overall contract and at different WBS levels.
• What: Analyze EAC reasonableness and develop
Government independent EAC
• How:
– Compute EVM performance metrics
– Review EAC reasonableness
• Test 1: Compare CPICUM to TCPI-EAC
• Test 2: Generate “floor” and “ceiling” EACs
– Evaluate trends:
•
•
•
•
Contract Performance Chart
C/S Variance Trends Chart
CPI and SPI Charts
Six Period Summary Report
– Determine your performance factors and compute most likely
Government independent EAC
• Determine the schedule driver SPICUM trends
• Determine the cost driver CPICUM trends
– Generate price at completion (PAC)
69
EVM 202
November 2017
Lesson 6-73
Estimate at Completion (EAC)
• Generate EACs by:
– Analyzing past performance
– Estimate future conditions
– Incorporate risks and opportunities as appropriate
• Government EACs:
– Mostly generated using a formula
– Subjective assessment with no one “right” formula
• Contractor-generated EAC is sometimes called Latest Revised
Estimate (LRE):
– Bottoms-up Estimate to Complete (ETC)
• Frequency and detail per contract requirement and internal system
description
• Only use formula-based ETC as a sanity check
– Regardless of bottoms-up estimate frequency, LREs should always reflect
the latest information
• Document assumptions and justifications
EAC = ACWP + ETC
EAC = A C WP + [
Remaining Work
]
Performance Factor
EAC = ACWP +[
BAC - BCWP
]
Performance Factor
70
EVM 202
November 2017
Lesson 6-74
EVM Performance Metrics
Schedule Performance Index (SPI)
• An efficiency factor representing the relationship between the
performance achieved and the initial planned schedule
• An index of 1.00 or greater indicates that work is being
accomplished at a rate on or ahead of what was planned
• An index of less than 1.00 suggests work is being
accomplished at a rate below the planned schedule
• An index of less than .95 is used as an early warning
indication of execution and should be explained
Cost Performance Index (CPI)
• An efficiency factor representing the relationship between the
actual cost expended and the performance accomplished
• An index of 1.00 or greater indicates that work is being
accomplished at a cost equal to or below what was planned
• An index of less than 1.00 suggests work is accomplished at a
cost greater than planned
• An index of less than .95 is used as an early warning indicator
of cost increase and should be explained
CPI Calculation
SPI Calculation
SPI =
EVM 202
BCWP
BCWS
CPI =
November 2017
BCWP
ACWP
71
Lesson 6-75
Review EAC Reasonableness
There are two ways to test the reasonableness of an EAC:
• When comparing CPICUM with TCPI, a difference of greater
than 0.10 means that achieving the target is unrealistic.
– When comparing CVCUM with VAC, a study has shown that once a
program is about 15% to 20% complete and overruns, it is extremely
challenging to recover the overrun.
• EAC range:
– Low bound: Using CPICUM as PF
– Upper bound: Using CPICUM * SPICUM as PF
• This is valid only when SPI is below 1.0.
72
EVM 202
November 2017
Lesson 6-76
EVM Performance Metrics (Cont. 1)
CPI to To-Complete Performance Index (TCPI)
• TCPI computes the future required cost efficiency needed to
achieve a targeted budget, i.e., LRE, EAC, BAC.
• CPI to TCPI comparison gauges the realism of the targeted
budget.
– A delta of ten or more percent is used as an early warning indication
that the targeted budget could beunrealistic.
TCPI Calculation
BAC - BCWP
TCPI_target =
target -ACWP
CPI to TCPI Calculation
TCPI - CPI x 100
73
EVM 202
November 2017
Lesson 6-77
EVM Performance Metrics (Format 1)
SPI
CUM =
CPI
CUM =
TCPI =
BCWP 8e. 8 100647
=
=
= 0.89
BCWS 8e. 7 113463
BCWP 8e. 8 100647
=
=
= 0.92
ACWP 8e. 9 108876
BAC - BCWP 8e. 14 - 8e. 8 634392 - 100647
=
=
= 1.02
EAC - ACWP 6c. 1 - 8e. 9 633787 - 108876
CPI to TCPI = TCPI - CPI x 100 = 1.02 -0.92 x 100 = 10%
The contractor’s most likely EAC may be too optimistic.
EVM 202
November 2017
74
Lesson 6-78
Generate Floor and Ceiling EACs
1.
2.
3.
EVM index-based EACs are essentially all generated from the
same formula. The only thing that changes is the performance
factor (PF).
We should not expect an exact EAC but a reasonable EAC
range.
Research suggests that the CPICUM PF provides the floor (low)
of the EAC range and CPICUM * SPICUM composite PF
provides the ceiling (high). (This is applicable when SPI is
below 1.0.)
BAC -BCWP
EAC = ACWP+ [
Performance Fa
]
ctor
Single Index
• CPICUM
• CPICUR
• CPI3MTH
• CPI6MTH
• SPICUM
• SPICUR
• Performance Factor
Composite
(CPICUM ∗SPICUM)
MICOM ‐ (CPI6MTH ∗
SPICUM)
Weighted
(0.8 ∗ CPICUM) + (0.2 ∗ SPICUM)
(0.4 ∗ CPIFACTORY) + (0.4 ∗ CPITEST) +
(0.2 ∗ CPIQUALITY)
75
EVM 202
November 2017
Lesson 6-79
Working with Empower Charts
Chart Button
•
Select Line, Column, or Bar to change the
chart type.
•
Select Show to apply the color background.
•
Select Hide to suppress the color background.
76
EVM 202
November 2017
Lesson 6-80
Working with Empower Charts (Cont. 1)
Zoom Button
• Pressing Zoom on the toolbar changes charts to
display all months of data.
Last Twelve Months—
Default
All Months—
Zoom Selected
Interactive X/Y Zoom
• Left-click, hold, and drag your mouse to zoom in on a specific
coordinate.
77
EVM 202
November 2017
Lesson 6-81
Working with Empower Charts (Cont. 2)
Option Menu—Show/Hide Legend Data
• Show includes data values for the most recent period in the
legend.
• Hide remove the data values from the legend.
Print, Download, or Copy Chart
• Select Print Chart to access the Print
dialog box.
• Download the chart and save/copy as
a PDF, PNG, SVG, or EMF file.
– Note that IE8, Chrome, Firefox use .PNGs
or .EMFs.
– If IE9 or higher, use .SVGs.
– MS Windows and Mac compliant.
• Use a snipping tool as an alternative.
78
EVM 202
November 2017
Lesson 6-82
Working with Empower Charts (Cont. 3)
Show/Hide Chart Line
• Select an item in the data legend to show/hide the line on the
chart. Grayed out legend items do not display on the chart.
79
EVM 202
November 2017
Lesson 6-83
EVM Tools
Empower: C/S Variance Trends Chart
wInsight: : C/S Variance Trends Chart
Cost/Schedule Variance Trends
Contractor: Increda, Corp
Contract: LAR EMD 2003
DAAH01-03-C-0076 CPIFEMD
Program: LAR Vehicle
AS OF: DEC 03
Complete
Start
2.0
0.0
-2.0
-4.0
Dollars in Millions
-6.0
-8.0
-10.0
2003
Cost Variance
Schedule Variance
Management Reserv e
EVM 202
2004
2005
-0.823
-1.282 10% Threshold
1.272 Start/Comp Dates
November 2017
2006
Cost Var Est @ Completion
JPO
-9.929
CTR
1.422
80
Lesson 6-84
EVM 202
November 2017
Lesson 6-85
Contract Performance Chart
Contract Level—Contract Performance Chart
1. This chart is Empower’s version of the Gold Card chart.
2. This chart displays both unfavorable CV and SV.
3. The contractor’s Estimate at Completion (EAC) appears
optimistic.
4. The PM raised his/her EAC this month.
81
EVM 202
November 2017
Lesson 6-86
C/S Variance Trends Chart
Contract Level—C/S Variance Trends Chart
1. The C/S Variance Trends chart is used extensively by
USD(A&S).
2. This chart displays unfavorable CV and SV for the LAR
Vehicle.
3. This chart displays an unfavorable SV breach of the ±10%
BCWPCUM reference bands.
4. This chart displays a slight use of MR.
5. The PM’s VAC is reasonable, and the Contractor’s VAC is
unreasonable when compared with the CV projection line.
82
EVM 202
November 2017
Lesson 6-87
CPI/TCPI Chart
Contract Level Chart—CPI/TCPI Chart
1. Compare CPICUM and TCPI-EAC.
2.
3.
– When CPICUM and TCPI-EAC are within ± 0.10, the EAC is reasonable.
CPICUM shows a smoothed line, which is useful for trend analysis.
Plotting current period data can help you spot a significant
change from the prior month and could be indicative of emerging
problems.
– Note the large deterioration in current CPI in this chart. You should
investigate the causes.
4.
A good trend cannot be determined from only four data points,
but the LAR’s current and cumulative CPI trends are unfavorable.
– Follow the trend over next few months to see if CPICUM trend continues to
decline or bottoms out.
83
EVM 202
November 2017
Lesson 6-88
CPI/SPI Chart
1.
2.
3.
4.
The CPI/SPI chart measures the accomplishment efficiency
of the work being done. Like the SV, an unfavorable SPI
metric may or may not indicate a late delivery. That can only
be determined by reviewing the network schedule.
The SPICUM is a more valuable EVM metric in early stages of
the contract, and it is not unreasonable for the SPICUR data
to spike up and down.
Unfavorable SPI trends are a good forecaster of future
unfavorable CPI trends.
A good trend cannot be determined from only four data
points, but the LAR Vehicle’s SPI trends are currently
unfavorable.
84
EVM 202
November 2017
Lesson 6-89
Six Period Summary Report
1.
The Statistic and Independent Forecasts section of Empower’s
Six Period Summary Report uses a variety of PFs to compute
the listed EACs.
a.
2.
3.
Shows how EACs change over time, reflecting the trend of PFs used.
(e.g., CUM CPI Fcst increased significantly in DEC 16, indicating cost
performance got worse.)
The CPICUM usually represents the floor, and the CPICUM *
SPICUM represents the ceiling.
Selected Empower PF EAC definitions:
a.
b.
c.
Performance Factor = 1
Cost and Schedule Performance Factor = 0.5 CPICUM + 0.5 SPICUM
MICOM EAC Performance Factor = CPI6MTH * SPICUM
Statistic and Independent Forecasts
Section of Six Period Summary
85
EVM 202
November 2017
Lesson 6-90
Hints for Trend Analysis and Selecting a
PF for an EAC
• Is the element’s performance steady or improving/declining at
an accelerating or slowing rate?
• Focus analysis on trends for the past 3-6 months.
• Watch out for:
– Sudden spikes
– Changes in direction (i.e., positive to negative)
• Based on knowledge of technical and schedule performance
to date, remaining work, and risks ahead:
– Is there a correlation between technical performance and earned value
performance?
– Can poor technical performance be used to predict future schedule
and cost problems?
• Technical performance and poor schedule performance are
often leading indicators. Cost performance is generally a
lagging indicator.
• Based on analysis, predict the future trend.
86
EVM 202
November 2017
Lesson 6-91
Generating Government EAC
• May generate at the contract level for quick turn exercises
– Pros: Already provided on 6 Period Summary Report
– Cons: Variances tend to cancel out and all elements are treated the same
• Assumptions:
– PF used: (0.5*CPI + 0.5*SPI)
– No additional risks or opportunities
– MR of $12.7M will be fully spent at the end (subtract BCWPCUM from BAC
with MR included)
EAC = ACWP +
BAC+MR
Low
EAC
High
EAC
$647M
$700M
$775M
BAC -BCWP
Performance Factor
= $712M
CPI
TCPI
CV
VAC
0.924
0.906
($8.2M)
($65.3M)
87
EVM 202
November 2017
Lesson 6-92
Generating Government EAC (Cont.)
• Better to generate at the lower level WBS, IPT, or OBS level
– Pros: Each element can use its performance and is fairly quick using
EXCEL
– Cons: Need to assess each level so will take longer
• Assumptions:
–
–
–
–
–
PFs used: (0.5*CPI + 0.5*SPI)
When indices are not available, used the contract level indices
For LOE elements with positive CPI, used budget values
No additional risks or opportunities
MR will be fully spent at the end
Format 2, OBS
ACWP
BAC
BCWP
CPI
SPI
EAC
Program Office
9,010
50,094
10,905
1.210
1.000
50,094
Program Control
4,832
21,916
6,458
1.337
1.000
21,916
Support Service
-
12,523
-
0.000
0.000
13,830
Manufacturing
13,786
187,852
13,513
0.980
1.000
189,886
QA
1,403
18,785
1,351
0.963
1.000
19,166
Procurement
18,767
118,973
18,947
1.010
1.000
118,295
Engineering
59,458
216,030
47,984
0.807
0.789
270,042
COM
1,622
8,218
1,490
0.919
0.987
8,943
G&A
15,584
-
14,377
0.923
0.991
-
MR
-
12,723
-
-
-
12,723
124,462
647,114
115,025
-
-
704,895
TOTAL
BAC+MR
Low
EAC
High
EAC
CPI
TCPI
CV
VAC
$647M
$700M
$775M
0.924
0.917
($8.2M)
($57.8M)
88
EVM 202
November 2017
Lesson 6-93
EVM CHART ANALYSIS EXERCISE
89
EVM 202
November 2017
Lesson 6-94
Price at Completion (PAC)
From Empower Executive Summary DEC 2016
CONTRACT TYPE: CPIF
CONTRACT PERIOD: 10 JUN 2016 to
30 May 2019
NEGOTIATED COST: 647,115,000
EST AUTH UNPRICED: 0.0
CONTR BUDGET BASE: 647,115,000
TOTAL ALLOC BUDGET: 647,115,000
PERF MEASUREMENT BL: 634,392,000
MANAGEMENT RESERVE: 12,723,000
TARGET FEE $: 77,007,000
TARGET FEE %: 11.90
TARGET PRICE: 724,122,000
SHARE RATIO ABOVE: 50/50
SHARE RATIO BELOW: 30/70
MIN FEE: 32,356,000
MAX FEE: 97,067,000
Contract Budget Base
$647,115,000
Most Likely EAC
$704,895,000
(Govt EAC @ Contract Level)
Forecast Overrun/Underrun
CBB – EAC
Target Fee
= -$57,780,000
$77,007,000
Share Ratio
50/50
- $28,890,000
Fee Adjustment
(Over or Under* Share Ratio)
Adjusted Fee
Target Fee + (Fee Adjustment)
$48,117,000
Check against min and max fees
= $753,012,000
Price at Completion (PAC)
EAC + Adjusted Fee*
Do we have adequate funding?
90
EVM 202
November 2017
Lesson 6-95
PAC Exercise
Use the Dec 16 Empower Executive Summary contract data and Six
Period Summary EAC forecasts to compute a LAR Dec16 PAC.
From Empower Executive Summary DEC 2016
CONTRACT TYPE: CPIF
CONTRACT PERIOD: 10 JUN 2016 to
30 May 2019
NEGOTIATED COST: 647,115,000
EST AUTH UNPRICED: 0.0
CONTR BUDGET BASE: 647,115,000
TOTAL ALLOC BUDGET: 647,115,000
PERF MEASUREMENT BL: 634,392,000
MANAGEMENT RESERVE: 12,723,000
TARGET FEE $: 77,007,000
TARGET FEE %: 11.90
TARGET PRICE: 724,122,000
SHARE RATIO ABOVE: 50/50
SHARE RATIO BELOW: 30/70
MIN FEE: 32,356,000
MAX FEE: 97,067,000
From Empower Six Period Summary DEC 2016
Statistical and Independent Forecasts
SEPT 16
OCT 16
NOV 16
DEC 16
CUR CPI
695,263,116
627,188,503
632,012,885
837,762,144
3 PER AVG
647,115,000
627,188,503
629,718,175
704,648,242
6 PER AVG
647,115,000
627,188,503
629,718,175
704,648,242
CUM CPI
695,263,116
679,023,301
669,234,539
700,023,774
CPI * SPI
734,461,584
721,124,185
726,155,131
775,298,246
MICOM EAC
647,115,000
665,692,475
682,771,842
780,511,577
COST & SCH
691,410,872
684,774,365
686,606,598
712,219,541
PF
Over/
Under
EAC
Fee
Adjustment
Adjusted
Fee
Applied
Fee
PAC
Do we have
enough
funds?
91
EVM 202
November 2017
Lesson 6-96
Step 2—Predict Future Performance
Summary
• Step 2: Predict Future Performance involves:
– Analyzing EAC reasonableness
– Developing an independent Government EAC
• The EVM analyst and the IPTs consider trend data, future
tasks, efforts in the IMS, and updated risk assessments.
• A key output of this analysis is an updated program EAC,
which can be compared to projected obligations to determine
if sufficient funding is available for the contract effort at any
given time.
92
EVM 202
November 2017
Lesson 6-97
September 2016
EVM 202—Lesson 6 Integrated Program Management Analysis Tools
and Techniques (Part 2)
STEP 3 FORMULATE A PLAN OF ACTION
• Using the information gleaned in the other
two steps, the EVM analyst and IPT
formulate a plan of action for the PM to:
– Meet schedule delivery dates
– Stay within budget
– Meet technical performance requirements
• Typically in this step of the analysis model,
funding and budgetary needs may be
reassessed and a variety of trades may be
made to remain within the bounds of the
contract cost, schedule, and technical
objectives.
2
EVM 202
November 2017
Lesson 6-97
Step 3—Formulate a Plan of Action (Cont.)
•
•
Why: Given integrated analysis results, recognize the types of
management decisions to achieve better acquisition outcomes
What:
– APB defines cost, schedule, and performance requirements that must be met
by the program
– EAC and price at completion (PAC) are essential requirements of program
management
– Compare CFSR and EVM data
– Variety of trade-off decisions may be made to remain within APB parameters.
•
How:
– Budget/funding decisions
•
•
•
•
•
Compute PAC and compare with program funding
Compare CFSR with IPMR data
De-scope the contract if funding is not sufficient, and/or
Increase contract budget request, if necessary, and/or
Obtain additional funding
– Trade-off decisions
• Relax the schedule, and/or
3
• Relax the technical scope
Comparative Analysis
•
Why: To ensure a defendable and credible program consistent with
Acquisition Program Baseline (APB) requirements and the program’s
Planning, Programming, Budgeting, and Execution (PPBE) system
allocations and estimated budgets
What:
•
How:
•
– APB defines cost, schedule, and performance requirements that must be met by the
program
– Product delivery must be achieved within the available resources allocated to the
program
– The estimated price at completion (PAC) range for the program must be compared
to the financial resources allocated and budgeted for the program
– Compare the APB, R-4, and network schedule
– Compare the Integrated Program Management Report (IPMR) and Contract Funds
Status Report (CFSR)
– Apply Earned Value Management (EVM) performance factors to determine the
contract funding requirements needed for the most likely PAC and to ensure against
potential Anti-Deficiency Act violations and misappropriations
– Status the APB cost parameters
4
EVM 202
November 2017
Lesson 6-98
APB, R-4, and Network Schedule
Comparison
LAR Vehicle EMD AUG 2016 R-4
The R-4 should be consistent with the
APB and the network schedule. Is it?
LAR Vehicle Milestone Schedule DEC 2016
Shows 3 – 4 month slip from the R-4 dated Aug
2016, and is within the APB threshold (just barely)
5
Compare the IPMR and CFSR
•
Why: To ensure data is consistent in the CFSR and the IPMR
•
What:
– Data will not necessarily match, but must be explainable
– CFSR
•
•
•
•
•
Generally submitted by contractor quarterly
At price (includes fee and/or profit)
Data entries can reflect cumulative or non-cumulative data
Includes actual costs from the accounting system
May have separate reporting by Contract Line Item or appropriation
– IPMR
•
•
•
•
•
EVM 202
Generally submitted by contractor monthly
At cost (does not include fee and/or profit)
Data entries can reflect cumulative or non-cumulative data
IPMR may include “estimated actuals” for material, subcontracts
How:
–
–
–
–
–
Compare report dates and contract data
Compare actuals todate
Compare billings todate
Compare projected obligations
Compare projected billings
November 2017
6
Lesson 6-99
Compare IPMR and CFSR Report Dates
and Contract Data
•
Why: To ensure that report dates and contract header data are consistent
•
What: CFSR states a report date of 16-12-31, Appropriation Identification of
2040, and Adjusted Contract Price (Target) of $724,120K
Question: Does this align with the IPMR? Is any difference explainable?
•
How:
–
–
–
–
Compare IPMR Format 1 Block 4, Report Period, to CFSR Block 6
Compare IPMR Format 1 Block 5, Contract Data, to CFSR Blocks 9, 10, 12, and 13
Compare IPMR Format 3 Block 5, Contract Data, to CFSR Block 11
Normalize the data to allow for comparison
• IPMR values are at cost
• CFSR values are at price
• To compare IPMR and CFSR values, the IPMR value must have the appropriate fee added
in:
– LAR Vehicle Program’s Target Fee: 11.9%
– LAR Vehicle Program’s Minimum Fee: 5%
– LAR Vehicle Program’s Maximum Fee: 15%
7
Compare IPMR and CFSR Report Dates
and Contract Data (Cont.)
8
EVM 202
November 2017
Lesson 6-100
Compare IPMR and CFSR Contract Data
Do they align?
YES.
1) CFSR Appropriation Identification 2040 = IPMR Phase EMD
2) To compare CFSR (at price) and IPMR (at cost) values, the IPMR value must have the
appropriate Fee added in (in this case, LAR Vehicle Program’s Target Fee of 11.9%):
IPMR Current Negotiated Cost and CBB + 11.9% Target Fee
= the CFSR Contract Work Authorized amount
9
Compare IPMR and CFSR Actuals to Date
•
Why: To determine the actual costs the contractor has incurred against this
contract
•
What: CFSR states contractor has $121,830K in Accrued Expenditures to
date
– Note that CFSR Block 12.b, Accrued Expenditures, are defined as recorded or
incurred costs; this is not the same as Defense Finance and Accounting Service
(DFAS) Expenditures
Question: Does this align with the IPMR? Is any difference explainable?
•
How:
– Compare IPMR Format 1 Block 8.g.9, Total Actual Cost of Work Performed
(ACWP), Cumulative to Date (cum) for Dec 2016 to CFSR Block 12.b, Accrued
Expenditures for Dec 2016 (Actual to Date)
– Normalize the data to allow for comparison
• IPMR Format 1 Block 8.g.9, ACWP(cum) is cumulative at cost
• CFSR Block 12.b, Accrued Expenditures, Actual to Date, is cumulative at price
10
EVM 202
November 2017
Lesson 6-101
Compare IPMR and CFSR Actuals to Date
(Cont.)
Do these align?
Is any difference explainable?
NO. The CFSR appears to include a Target Fee of 11.9%. Why is the contractor billing
at the Target Fee instead of the Minimum Fee, given their performance to date?
11
Compare IPMR and CFSR DEC
Forecasted Billings
•
•
Why: To determine how much the contractor has billed the Government
against this contract
– Knowing a contractor’s billing schedule allows the PMO to forecast DFAS
Expenditures (after adding in a lag for DFAS processing time)
What: CFSR states contractor has $87,560K in actual billings to date
Question: Does this align with the IPMR? Is any difference explainable?
•
How:
– Assuming a one-month lag from actual costs incurred to billing, compare IPMR
Format 1 ACWP(cum) for Nov 2016 to CFSR Block 13, Forecast of Billings to the
Government for Dec 2016 Actuals to Date Column
• Nov 2016 actual costs incurred will be billed in Dec 2016
• Calculate Nov 2016 actual costs incurred by subtracting IPMR Format 1 Block 8.g.4, ACWP
Current Period (cur) for Dec 2016, from Block 8.g.9, ACWP(cum) for Dec 2016
– Normalize the data to allow for comparison
• IPMR Format 1 Block 8.g.4, ACWP(cur), is non-cumulative at cost
• IPMR Format 1 Block 8.g.9, ACWP(cum), is cumulative at cost
• CFSR Block 13, Forecast of Billings to the Government, is cumulative at price
12
EVM 202
November 2017
Lesson 6-102
Compare IPMR and CFSR DEC
Forecasted Billings (Cont.)
Do these align?
Is any difference explainable?
NO. The CFSR appears to include no fee. Why is the contractor now billing at zero fee instead of the
Target Fee (as they did in Actuals to Date) or the Minimum Fee (given their performance to date)?
13
Compare IPMR and CFSR Projected
Obligations
•
Why: To understand contractor price at completion (PAC)
– Note that CFSR Block 12.b., Accrued Expenditures, is defined as recorded or
incurred costs. This line includes actual accrued expenditures and time-phased
projected accrued expenditures.
•
What: Compare the IPMR most likely estimate at completion (EAC) to the
CFSR most likely PAC
•
How:
Question: Are any differences in the reports explainable?
– Compare IPMR Format 1, Block 6.c., Most Likely Estimate at Completion, to CFSR
Block 12.b., Accrued Expenditures (At Completion)
– Normalize the data to allow for comparison
• IPMR Format 1, Estimate at Completion, is at cost
• CFSR Block 12.b., Accrued Expenditures, is at price
14
EVM 202
November 2017
Lesson 6-103
Compare IPMR and CFSR Projected
Obligations (Cont.)
Do these align?
Is any difference explainable?
NO. The CFSR PAC should equal the IPMR most likely EAC, plus fee earned. The IPMR most
likely EAC shows an underrun, so the contractor would share 70% in that underrun. The CFSR
PAC is higher than that. It looks like they assume they will earn 100% of the underrun!
15
Compare IPMR and CFSR JAN Projected
Obligations
•
Why: To understand contractor time-phased plans and estimates, necessary
for comparison to fiscal year funding and budget documents
– Note that CFSR Block 12.b., Accrued Expenditures, is defined as recorded or
incurred costs. This is our proxy for projected obligations (Program Office Spend
Plan).
•
What: CFSR states that the contractor needs $154,220K cumulative funds
obligated to cover all projected Accrued Expenditures through Jan 2017
Question: Does this align with the IPMR? Is any difference explainable?
16
EVM 202
November 2017
Lesson 6-104
Compare IPMR and CFSR JAN Projected
Obligations (Cont.)
•
How:
– Compare IPMR Format 3 Block 6.c., Performance Measurement Baseline, to CFSR
Block 12.c., Accrued Expenditures
– Normalize the data to allow for comparison
• IPMR Format 3 period Budgeted Cost for Work Scheduled (BCWS) is noncumulative at cost
• CFSR Block 12.c., Accrued Expenditures, is cumulative at price
• IPMR BCWS is not the latest EAC; CFSR Block 12.c. is the most likely EAC
– Pull DEC 2016 BCWScum and JAN 2017 BCWScur and convert to reflect performance
» Adjust BCWScur to account for cumulative schedule performance to date (SPI =
0.89) and to derive an estimate of a new schedule adjusted BCWP = BCWS * SPI
» Adjust new BCWP profile to account for cumulative cost performance to date (CPI
= 0.92): BCWP/CPI
17
Compare IPMR and CFSR JAN Projected
Obligations (Cont. 1)
18
EVM 202
November 2017
Lesson 6-105
Compare IPMR and CFSR JAN Projected
Obligations (Cont. 2)
Do these align?
Is any difference explainable?
NO. The CFSR Jan 16 estimates are higher than the normalized IPMR BCWS $. They need to
explain the difference.
19
Compare IPMR and CFSR JAN Projected
Billings
•
Why: To determine how much the contractor is projecting to bill the
Government against this contract next month
– Knowing a contractor’s billing forecast allows the PMO to forecast DFAS
Expenditures (after adding in a lag for DFAS processing time). This is a proxy for
required expenditures (Program Office Expenditure Plan).
•
What: CFSR states contractor projects $32,400K in billings in Jan 2017
Question: Does this align with the IPMR? Is any difference explainable?
•
How:
– Assuming a one-month lag from actual costs incurred to billing, compare IPMR
Format 1 Block 8.g.4, ACWP(cur) for Dec 2016, to CFSR Block 13, Forecast of
Billings to the Government for Jan 2017
• e.g., Dec 2016 actual costs incurred will be billed in Jan 2017
– Normalize the data to allow for comparison
• IPMR Format 1 Block 8.g.4, ACWP(cur), is non-cumulative at cost
• CFSR Block 13, Forecast of Billings to the Government, is non-cumulative at price
20
EVM 202
November 2017
Lesson 6-106
Compare IPMR and CFSR JAN Projected
Billings (Cont. 1)
Do these align?
Is any difference explainable?
NO. The CFSR includes the Target Fee of 11.9%. Why is the contractor back to projecting billings at the
Target Fee instead of an amount greater than the Target Fee (as they did in Projected Obligations), zero
fee (as they did in Billings to Date), or the Minimum Fee (given their performance to date)?
21
Compare IPMR and CFSR FEB Projected
Billings
•
Why: To determine how much the contractor has billed the Government
against this contract
– Knowing a contractor’s billing schedule allows the PMO to forecast DFAS
Expenditures (after adding in a lag for DFAS processing time)
•
What: CFSR states contractor has $32,400K in forecasted billings for Feb
2017
Question: Does this align with the IPMR? Is any difference explainable?
22
EVM 202
November 2017
Lesson 6-107
Compare IPMR and CFSR FEB Projected
Billings (Cont. 1)
•
How:
– Assuming a one-month lag from actual costs incurred to billing, compare IPMR
Format 3, BCWS(cur) for Jan 2017, to CFSR Block 13, Forecast of Billings to the
Government for Feb 2017
• Assume Jan 2017 actual costs incurred will be billed in Feb 2017
– Normalize the data to allow for comparison
• IPMR Format 3, BCWS(cur) used for Government ACWP, is non-cumulative at cost
• CFSR Block 13, Forecast of Billings to the Government, is cumulative at price
• IPMR BCWS is not the latest EAC; CFSR Block 12c is most likely EAC
– Pull JAN 2017 BCWScur and convert to reflect performance
» Adjust BCWScur to account for cumulative schedule performance to date (SPI =
0.89) and to derive an estimate of a new schedule adjusted BCWP = BCWS * SPI
» Adjust new BCWP profile to account for cumulative cost performance to date (CPI
= 0.92): BCWP/CPI
23
Compare IPMR and CFSR FEB Projected
Billings (Cont. 2)
24
EVM 202
November 2017
Lesson 6-108
Compare IPMR and CFSR FEB Projected
Billings (Cont. 3)
Do these align?
Is any difference explainable?
NO. The CFSR appears to include a fee greater than the Max Fee (15%). Is the contractor
catching up on actuals and/or fee not billed previously?
25
IPMR/CFSR Comparative Analysis Exercise
Compare the IPMR and the CFSR time-phased estimates.
1. Open the worksheet “IPMR CFSR Comparative Analysis Exercise” on
Blackboard.
2. Locate the DEC 2016 LAR Vehicle Program IPMR Formats 1 and 3 and
the CFSR in your Student Guide.
3. Enter the following information into the table using the IPMR:
a.
b.
c.
d.
e.
New program office PAC from Lesson 6 (At Completion)
IPMR Format 3 BCWS for Cumulative to Date, JAN 17 to JUN 17, SEP 17, SEP
18, and To Complete
SPICUM from Lesson 6 for JAN 17 to JUN 17, SEP 17, and SEP 18
EAC performance factor (CPICUM from Lesson 6) for JAN 17 to JUN 17, SEP 17,
and SEP 18
Estimate fee for Cumulative to Date, JAN 17 to JUN 17, SEP 17, and SEP 18
(Use two decimal places for SPICUM and CPICUM.)
4. For columns that have no reported data, leave the cells empty.
26
EVM 202
November 2017
Lesson 6-109
Comparative Analysis Conclusions
•
Possible reasons for deltas between contractor CFSR and Government PAC
time-phasing:
–
–
–
–
Contractor used other than minimum fee (5%)
Contactor used other than one-month lag between actual cost incurred and billing
Errors in contractor submission
Contractor CFSR includes risk items or worst-case scenario (since contractor
appears to be forecasting funding in advance of when it is actually required)
– Contractor CFSR includes efficiencies in CPI/SPI (Government PAC based on
BCWS) or other (Should Cost)
– Differences in reporting frequency (IPMR – monthly; CFSR – quarterly)
•
What action(s) should you take?
– Communicate with contractor to understand differences
• Hold quarterly conference call upon CFSR receipt and analysis
– Adjust funding provided to contractor (don’t assume CFSR is correct)1
27
Evaluate PAC and Contractor Finances
Evaluate the contractor’s PAC to determine potential Anti-Deficiency Act
violations:
1. Start with the obligation results from the Comparative Analysis Exercise just
completed.
2. Confirm budget availability from the R-3.
3. Determine projected excess funds.
28
EVM 202
November 2017
Lesson 6-110
Evaluate APB Requirements
•
•
Is the current PAC consistent with the APB requirements?
Is the APB funding profile supported by current R-documents?
29
Lesson 6 Summary
•
Terminal Learning Objective (TLO)
– Given an Integrated Analysis Model, assess integrated program
management data to make informed recommendations to support program
management decisions
•
Enabling Learning Objective (TLO)
– Explain key elements of an Integrated Analysis Model
–
–
–
–
–
–
–
–
Identify current program technical, cost, and schedule requirements
Assess Integrated Program Management Report (IPMR) data validity
Analyze data to determine technical, schedule, and cost drivers
Construct a realistic estimate at completion (EAC) and appropriate timephased price at completion (PAC)
Analyze the Integrated Master Schedule (IMS) to determine the ability to
meet schedule requirements
Explain the influence of EVM analysis on budget and program documents
Demonstrate if program funding/budget is consistent with the Contract Funds
Status Report (CFSR) and the time-phased Government PAC
Justify recommendations for program management decisions
30
EVM 202
November 2017
Lesson 6-111
Exercise Instructions
Evaluate the integrated program management analysis approach presented by the DAU
instructor. Determine how this approach applies to your duties in the LAR Vehicle PMO. Refresh
your own analysis approach by reviewing the material contained in this lesson and by
completing the exercises.
Pay special attention to the following topical areas:
•
•
•
•
IPMR terms, definitions, equations, and calculations; understand how all performance
factors are linked, especially cost and schedule relationships
EVM schedule health metrics and how to calculate them
Techniques for reading and interpreting critical path schedules
Analyzing sample IPMR, schedule, and technical performance data
EVM 202
November 2017
Lesson 6-112
Program Control Book
LIGHTWEIGHT, ASSAULT AND RECONNAISSANCE (LAR) VEHICLE
DECEMBER 2016
EVM 202
UNCLASSIFIED
Lesson 6-113
LAR Vehicle Program Control Book—DEC 2016
Table of Contents
LAR Joint Program Office (JPO) Budget Documents.................................................................................. 116
Acquisition Program Baseline (APB)—March 2016............................................................................... 117
1. APB Dates ...................................................................................................................................... 117
2. Background ................................................................................................................................... 118
3. LAR Vehicle Acquisition Program Baseline .................................................................................... 119
Army Research, Development, Test, and Evaluation (RDT&E) Budget Item Justification and Defense
Finance and Accounting Service (DFAS) Obligations and Expenditures ................................................ 123
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R‐2)—August 2016 .................................................... 123
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R‐3)—August 2016 .................................................... 124
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R‐4)—August 2016 .................................................... 125
LAR EMD RDT&E DFAS Obligations—As of December 2016 ............................................................. 126
LAR EMD RDT&E DFAS Expenditures—As of December 2016 .......................................................... 127
Increda LAR Vehicle Documents ............................................................................................................... 128
Integrated Program Management Report (IPMR) Format 1—As of 31 Dec 2016................................. 129
IPMR Format 2—As of 31 Dec 2016 ...................................................................................................... 131
IPMR Format 3—As of 31 Dec 2016 ...................................................................................................... 132
IPMR Format 4 EAC—As of 31 Dec 2016 ............................................................................................... 133
IPMR Format 4 BAC—As of 31 Dec 2016............................................................................................... 134
IPMR Format 5—As of 31 Dec 2016 ...................................................................................................... 135
Contract Summary ............................................................................................................................ 135
Formal Reprogramming (OTB/OTS) .................................................................................................. 135
Estimate at Completion (EAC) ........................................................................................................... 135
Undistributed Budget (UB)................................................................................................................ 135
Management Reserve (MR) .............................................................................................................. 135
Integrated Master Schedule (IMS) .................................................................................................... 135
Format 3 Changes ............................................................................................................................. 135
Format 4 Changes ............................................................................................................................. 135
Cost and Schedule Variances ............................................................................................................ 136
At Completion Variances................................................................................................................... 136
Variance Analysis .............................................................................................................................. 136
Contract Funds Status Report (CFSR)—As of 31 Dec 2016 .................................................................... 139
System Engineering Documents................................................................................................................ 140
EVM 202
UNCLASSIFIED
Lesson 6-114
LAR Vehicle Program Control Book—DEC 2016
Fuel Consumption December 2016 TPM .............................................................................................. 141
Operating Power December 2016 TPM ................................................................................................ 142
IR Signature December 2016 TPM ........................................................................................................ 143
Power Package Weight December 2016 TPM....................................................................................... 144
Mean Time Between Failure (MTBF) December 2016 TPM.................................................................. 145
Estimates for Selected Performance KPPs—As of December 2016 ...................................................... 146
Contract Specifications ..................................................................................................................... 146
Specification Estimates* Status as of 15 Dec 2016 ........................................................................... 146
Risk Assessment—As of December 2016 .............................................................................................. 147
EVM 202
UNCLASSIFIED
Lesson 6-115
LAR Vehicle Program Control Book—DEC 2016
LAR Joint Program Office (JPO) Budget Documents
U.S. Army Tank-Automotive & Armaments Command
Acquisition Program Baseline
for
Lightweight, Assault and Reconnaissance Vehicle Program
System Development & Demonstration
March 2016
EVM 202
UNCLASSIFIED
Lesson 6-116
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
Acquisition Program Baseline (APB)—March 2016
1. APB Dates
Approval
Date
TBD
EVM 202
Name
Phase
Event
Authority
Development
APB
Development
Milestone (MS) B
Defense
Acquisition
Executive (DAE)
UNCLASSIFIED
Base
Year
Original
Change
2016
Yes
No
Lesson 6-117
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
2. Background
1.1 Need—In October 2012, the Army leadership announced a vision of the future. This vision
includes a Brigade structure and organization which is crucial to the Army's strategic
responsiveness goals of deploying from a Continental United States (CONUS) base to a global
theater of operation. These goals include deploying: one Brigade within 96 hours; one Division
within 120 hours; and five Divisions within 30 days. To achieve this vision for the Army, the
Tank-automotive and Armaments Command (TACOM) and United States Joint Forces
Command (USJFC) initiated a Class II Joint Capability Technology Demonstration (JCTD) of a
Lightweight, Assault and Reconnaissance (LAR) Vehicle.
1.2 Program Description—The LAR Vehicle will be a CH-47 and C-130 transportable armored
vehicle capable of deployment to anywhere on the globe in a combat ready configuration. A
LAR Vehicle-equipped Interim Brigade Combat Team (IBCT) will provide an immediate
response by a lethal, versatile, tactically agile joint force capable of operational maneuver once
in the Area of Operations. This capability addresses the dynamic asymmetric threat and
operational environment essential to fulfilling the war-fighting needs of the National Command
Authority.
1.3 Acquisition Strategy and Development Approach—Operational testing was completed on
the JCTD LAR in December 2014. Survivability and suspension related issue were identified
during testing, warranting additional development. Consistent with the approved LAR JCTD
transition plan, the LAR Vehicle program is scheduled to transition as an Acquisition Category I
(ACAT-I) Engineering and Manufacturing Development (EMD) program in FY16. An RFP for a
full and open competition was prepared in the third quarter of FY15, and a source selection and
contract award is planned for the second quarter of FY16. Contractors will present their
concepts to address JCTD test and warfighter deficiencies and to demonstrate full military utility.
A single contract will be awarded for the remaining development (EMD) and manufacture of four
production prototype vehicles. Follow-on contracts will cover the production and support
activities for the LAR Vehicle program.
1.4 References
1.4.1 LAR JCTD Transition Plan, TACOM-JCTD-2015-1, December 15, 2015.
EVM 202
UNCLASSIFIED
Lesson 6-118
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
3. LAR Vehicle Acquisition Program Baseline
Section A, Performance—03/21/16
Performance Parameters
Objective
Threshold
Probability of Kill
0.92
0.90
Survivability*
0.95
0.95
Speed (MPH)
90
80
Side Slope
40⁰
35⁰
Grade*
50⁰
40⁰
Approach Angle
75⁰
70⁰
Departure Angle
60⁰
55⁰
Turning Radius*
20 ft.
25 ft.
Range (miles)*
400
350
Combat Vehicle Weight (KG)*
<11,000
13,500
Empty Vehicle Weight (KG)
11,500
<13,000
Payload Weight (KG)
2000
2000
See CDD
See CDD
Full Mission Capability Rate
0.95
0.90
Availability*
0.98
0.96
MMH/OH
0.05
0.1
MTTR
1
1.5
MTBCMF*
700
625
Missiles
4
3
Rounds
2500
2200
Noise (Max Decibels)
<2xxx
<2xxx
Classified
Classified
Interoperability*
Heat Emittance
* Key Performance Parameters (KPPs)
Acronyms and Abbreviations:
CDD – Capability Development Document
KG - Kilograms
MMH/OH – Maintenance Man-hours per
Operating Hour
MPH – Miles per Hour
MTBCMF – Mean Time between Critical Mission
Failures
MTTR – Mean Time to Repair
NOTE: See CDD for further detail on KPPs.
EVM 202
UNCLASSIFIED
Lesson 6-119
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
Section B, Schedule—03/21/16
Milestones
Objective
Threshold
ICD Approval
OCT 2012
OCT 2012
JCTD Contract Award
JUL 2013
JUL 2013
JCTD Delivery
DEC 2014
DEC 2014
EMD Draft RFP Release
AUG 2015
AUG 2015
JCTD Testing Complete
DEC 2015
DEC 2015
ORD/TEMP Approved
FEB 2016
FEB 2016
EMD Proposals Received
FEB 2016
FEB 2016
MS B Decision
MAR 2016
MAR 2016
EMD Contract Award
MAR 2016
JUN 2016
Subsystem CDR
JAN 2017
MAY 2017
System CDR
SEP 2017
DEC 2017
PPD
JUL 2018
DEC 2018
Draft LRIP/Production RFP Release
JAN 2019
APR 2019
DT/OT Complete
JAN 2019
APR 2019
LRIP Proposal Received
JUN 2019
SEP 2019
MS C/LRIP/Prod Contract Awarded
OCT 2019
APR 2020
LRIP First Unit Delivery
JUL 2020
JAN 2021
FCA/PCA
DEC 2020
JUN 2021
Live Fire & IOT&E Complete
DEC 2020
JUN 2021
FRP Decision Review/Full Rate Option 1
JAN 2021
JUL 2022
IOC (100 LAR Vehicles)
JUN 2022
DEC 2022
FOC (500 LAR Vehicles)
DEC 2026
JUN 2027
Acronyms and Abbreviations:
CDR – Critical Design Review
DT – Developmental Testing
EMD – Engineering and Manufacturing
Development
FCA – Functional Configuration Audit
FOC – Full Operational Capability
FRP – Full Rate Production
ICD – Initial Capabilities Document
IOC – Initial Operational Capability
IOT&E – Initial Operational Test and Evaluation
EVM 202
JCTD – Joint Capability Technology
Determination
LRIP – Low Rate Initial Production
MS - Milestone
ORD – Operational Requirements Document
OT – Operational Testing
PCA – Preliminary Configuration Audit
PPD – Production Prototype Delivery
Prod – Production
RFP – Request for Proposals
TEMP – Test and Evaluation Master Plan
UNCLASSIFIED
Lesson 6-120
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
Section C, Budget—03/21/16
Then-Year $M
Objective
Threshold
RDT&E
1000
1100
Procurement
1250
1375
Total Acquisition Cost
2250
2475
O&S
5600
N/A
Total Life Cycle Cost
7850
N/A
Pro Acq Unit Cost ($M)
4.464
N/A
Avg Proc Unit Cost ($M)
2.5
2.75
Base-Year $M (BY 2016)
Objective
Threshold
RDT&E
943.0
1037
Procurement
1064
1170
Total Acquisition Cost
2007
2207
O&S
3725
4097
Total Life Cycle Cost
5732
6304
Pro Acq Unit Cost ($M)
3.982
4.380
Avg Proc Unit Cost ($M)
2.128
2.340
Quantity
Objective
Threshold
RDT&E
4
N/A
Procurement
500
N/A
Acronyms and Abbreviations:
Acq – Acquisition
Avg – Average
O&S – Operations and Support
EVM 202
Pro – Program
Proc – Procurement
RDT&E – Research, Development, Test, and Evaluation
UNCLASSIFIED
Lesson 6-121
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
Submitted by:
Clayton S. Paine
21 MAR 16
CLAYTON S. PAINE, Colonel, USA
LAR Vehicle Program Manager
Date
Approved by:
Gregory L Moatars
21 MAR 16
GREGORY L. MOATARS, Major General, USA
Program Executive Officer Ground Combat Systems
EVM 202
UNCLASSIFIED
Date
Lesson 6-122
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
Army Research, Development, Test, and Evaluation (RDT&E) Budget Item Justification and
Defense Finance and Accounting Service (DFAS) Obligations and Expenditures
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R-2)—August 2016
APPROPRIATION/BUDGET ACTIVITY
RDT&E Engineering and Manufacturing
Development (EMD)
PROGRAM ELEMENT
0604285A
PROJECT NAME AND NUMBER
Lightweight, Assault & Reconnaissance (LAR) Vehicle DC06
FY2016
FY2017
FY2018
FY2019
FY2020
FY2021
FY2022
Cost to
Total Cost
Actual
Estimate
Estimate
Estimate
Estimate
Estimate
Estimate
Complete
LAR Vehicle EMD
168990
258860
303860
252390
0
0
0
0
984100
A. Mission Description and Budget Item Justification: This program supports the development of a LAR Vehicle. An immediate need exists for a CH‐47 and C‐
130 transportable LAR Vehicle, capable of deployment to anywhere on the globe in a combat ready configuration. A dynamic asymmetric threat and
operational environment demands full spectrum, strategically responsive, agile and dominate land forces. Immediate response by a lethal, versatile,
tactically agile joint force capable of operational maneuver once in the Area of Operations is essential to fulfilling the warfighting needs of the National
Command Authority. A LAR Vehicle‐equipped Interim Brigade Combat Team (IBCT) is this force. RDT&E funding will be used to transition the LAR Vehicle
Joint Capability Technology Determination (JCTD) to system development and to produce four demonstration LAR Vehicles for full military utility
assessment.
Prior Year Accomplishments: LAR JCTD delivered and tested.
FY 2016 Program: Achieved Milestone B EMD Contract Awarded
FY 2017 Planned Program: Provides funds for continuation of EMD Contract
Cost (in Thousands)
B.
C.
Program Change Summary
FY2017/2018 President's Budget (PB)
Appropriated Value
Adjustments from FY2017/2018 PB
FY2018‐2022 Program Objectives Memorandum (POM)/
Budget Estimate Submission (BES)
FY16
168990
168990
0
168990
FY17
258860
FY18
303860
FY19
252390
0
258860
0
303860
0
252390
Acquisition Strategy: In October 2012, the Army leadership announced a vision of the future. This vision includes a Brigade structure and organization
which is crucial to the Army's strategic responsiveness goals of deploying from a Continental United States (CONUS) base to a global theater of operation.
These goals include deploying: one Brigade within 96 hours; one Division within 120 hours; and five Divisions within 30 days. To achieve this vision for
the Army, the Tank‐automotive and Armaments Command (TACOM) and United States Joint Forces Command (USJFC) initiated a Class II Joint Capability
Technology Demonstration (JCTD) of a LAR Vehicle. Consistent with the approved LAR JCTD transition plan and Milestone B decision, the LAR Vehicle
program transitioned as an Acquisition Category I (ACAT‐I) EMD program in March 2016. An RFP for a full and open competition was prepared and
released in the third quarter FY15. EMD proposals were received from two contractors resulting in a third quarter FY16 source selection. A single
contract was awarded in June 2016 for the remaining development (EMD) and manufacture of four production prototype vehicles designed to address
JCTD test and warfighter deficiencies and to demonstrate full military utility.
UNCLASSIFIED
EVM 202
UNCLASSIFIED
Lesson 6-123
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R-3)—August 2016
PROJECT NAME AND NUMBER
Lightweight, Assault & Reconnaissance (LAR) Vehicle DC06
PROGRAM ELEMENT
0604285A
APPROPRIATION/BUDGET ACTIVITY
RDT&E Engineering and Manufacturing Development (EMD)
I. Product
Development
Contract
Method & Type
Performing Activity
& Location
Total
PYs Cost
FY 2017
Cost
FY 2017
Award Date
FY 2018
Cost
FY 2018
Award Date
Cost to
Complete
Total
Cost
Target Value
of Contract
a. EMD LAR
CPIF
Increda Corp, Los
Angeles, CA
140000
229100
JUN 16
273500
JUN 2016
167100
809700
809700
140000
229100
167100
809700
809700
Total
PYs Cost
FY 2017
Cost
FY 2017
Award Date
FY 2018
Cost
FY 2018
Award Date
Cost to
Complete
Total
Cost
Target Value
of Contract
430
1200
OCT 16
1800
OCT 16
1840
5270
5270
430
1200
1840
5270
5270
Total
PYs Cost
FY 2017
Cost
FY 2017
Award Date
FY 2018
Cost
FY 2018
Award Date
Cost to
Complete
Total
Cost
Target Value
of Contract
0
0
NA
0
NA
54890
54890
54890
0
0
54890
54890
54890
Subtotal Product Development
II. Support Costs
Contract
Method & Type
Performing Activity
& Location
a. Other Gov’t
Agencies
MIPR
TACOM, Warren,
MI Various
Subtotal Support Costs
III. Test and
Evaluation
Contract
Method & Type
Performing Activity
& Location
a. EMD LAR
Testing
MIPR
ATEC, APG, MD
Subtotal Test and Evaluation
273500
1800
0
IV. Management
Services
Contract
Method & Type
Performing Activity
& Location
Total
PYs Cost
FY 2017
Cost
FY 2017
Award Date
FY 2018
Cost
FY 2018
Award Date
Cost to
Complete
Total
Cost
Target Value
of Contract
a. PMO Support
NA
TACOM, Warren,
MI
15000
15000
NA
15000
NA
15000
60000
60000
b. SETA Contract
FPLOE
SETA Corp,
Lansdale, PA
13560
13560
DEC 15
13560
DEC 15
13560
54240
54240
Subtotal Management Services
28560
28560
28560
28560
114240
114240
Total Program
168990
258860
303860
252390
984100
984100
EVM 202
UNCLASSIFIED
Lesson 6-124
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
ARMY RDT&E BUDGET ITEM JUSTIFICATION (R-4)—August 2016
APPROPRIATION/BUDGET ACTIVITY
RDT&E Engineering and Manufacturing Development (EMD)
EVM 202
PROGRAM ELEMENT
0604285A
UNCLASSIFIED
PROJECT NAME AND NUMBER
Lightweight, Assault & Reconnaissance (LAR) Vehicle DC06
Lesson 6-125
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
LAR EMD RDT&E DFAS Obligations—As of December 2016
FY16 Obligations
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
140.00
140.00
13.50
13.50
0. 40
0. 40
15.0
13.8
168.90
167.70
169.00
Nov‐16
140.00
140.00
13.50
13.50
0. 40
0. 40
15.0
13.8
168.90
167.70
169.00
Dec‐16
140.00
141.30
13.50
13.50
0. 40
0. 40
15.0
13.8
168.90
169.00
169.00
Jan‐17
140.00
Feb‐17
140.00
Mar‐17
140.00
Apr‐17
140.00
May‐17
140.00
Jun‐17
140.00
Jul‐17
140.00
Aug‐17
140.00
Sep‐17
140.00
13.50
13.50
13.50
13.50
13.50
13.50
13.50
13.50
13.50
0. 40
0. 40
0. 40
0. 40
0. 40
0. 40
0. 40
0. 40
0. 40
15.0
15.0
15.0
15.0
15.0
15.0
15.0
15.0
15.0
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
169.00
FY17 Obligations
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
76.40
0.00
13.60
0.00
1.20
0.00
1.30
0.00
92.40
0.0
258.90
Nov‐16
76.40
0.00
13.60
0.00
1.20
0.00
2.50
1.10
93.7
1.10
258.90
Dec‐16
76.40
0.00
13.60
13.60
1.20
1.20
3.80
2.20
94.90
17.0
258.90
Jan‐17
152.70
Feb‐17
152.70
Mar‐17
152.70
Apr‐17
229.10
May‐17
229.10
Jun‐17
229.10
Jul‐17
229.10
Aug‐17
229.10
Sep‐17
229.10
13.60
13.60
13.60
13.60
13.60
13.60
13.60
13.60
13.60
1.20
1.20
1.20
1.20
1.20
1.20
1.20
1.20
1.20
5.00
6.30
7.50
8.80
10.00
11.30
12.50
13.80
15.00
172.50
173.80
175.00
252.70
253.90
255.20
256.40
257.70
258.90
258.90
258.90
258.90
258.90
258.90
258.90
258.90
258.90
258.90
Cumulative FY15‐FY17
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
216.4
140.0
27.1
13.5
1.2
0.0
16.3
13.8
261.3
167.7
427.9
Nov‐16
216.4
140.0
27.1
13.5
1.2
0.0
17.5
14.9
262.6
168.8
427.9
Dec‐16
216.4
141.3
27.1
27.1
1.2
1.2
18.8
16.0
263.8
186.0
427.9
Jan‐17
292.7
Feb‐17
292.7
Mar‐17
292.7
Apr‐17
369.1
May‐17
369.1
Jun‐17
369.1
Jul‐17
369.1
Aug‐17
369.1
Sep‐17
369.1
27.1
27.1
27.1
27.1
27.1
27.1
27.1
27.1
27.1
1.2
1.2
1.2
1.2
1.2
1.2
1.2
1.2
1.2
20.0
21.3
22.5
23.8
25.0
26.3
27.5
28.8
30.0
341.5
342.8
344.0
421.7
422.9
424.2
425.4
426.7
427.9
427.9
427.9
427.9
427.9
427.9
427.9
427.9
427.9
427.9
EVM 202
UNCLASSIFIED
Lesson 6-126
LAR Vehicle Program Control Book—DEC 2016
JPO Budget Documents
LAR EMD RDT&E DFAS Expenditures—As of December 2016
FY16 Expenditures
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
31.7
9.0
9.5
9.4
0.4
0.4
13.8
13.8
55.3
32.6
169.0
Nov‐16
53.3
38.5
10.8
11.8
0.4
0.4
15.0
13.8
79.5
64.5
169.0
Dec‐16
75.0
60.7
12.2
11.6
0.4
0.4
15.0
13.8
102.5
86.5
169.0
Jan‐17
96.7
Feb‐17
118.3
Mar‐17
140.0
Apr‐17
140.0
May‐17
140.0
Jun‐17
140.0
Jul‐17
140.0
Aug‐17
140.0
Sep‐17
140.0
13.5
13.5
13.5
13.5
13.5
13.5
13.5
13.5
13.5
0.4
0.4
0.4
0.4
0.4
0.4
0.4
0.4
0.4
15.0
15.0
15.0
15.0
15.0
15.0
15.0
15.0
15.0
169.0
169.0
169.0
169.0
169.0
169.0
169.0
169.0
16.9
169.0
169.0
169.0
169.0
169.0
169.0
169.0
169.0
169.0
FY17 Expenditures
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
258.9
Nov‐16
0.00
0.00
0.00
1.4
0.00
0.00
0.00
0.00
0.00
1.4
258.9
Dec‐16
0.00
0.00
0.00
2.8
0.1
0.00
1.3
0.00
1.4
2.8
258.9
Jan‐17
0.00
Feb‐17
0.00
Mar‐17
0.00
Apr‐17
19.1
May‐17
38.2
Jun‐17
57.3
Jul‐17
76.4
Aug‐17
95.5
Sep‐17
114.5
0.00
0.00
1.1
2.3
3.4
4.5
5.7
6.8
7.9
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
2.5
3.8
5.0
6.3
7.5
8.8
10.0
11.3
12.5
2.7
4.1
6.5
28.1
49.7
71.3
92.8
114.4
136.0
258.9
258.9
258.9
258.0
258.9
258.9
258.9
258.9
258.9
Cumulative FY15‐FY17
JPO EMD LAR Contract Forecast
DFAS EMD LAR Contract Actual
JPO LAR SETA Contract Forecast
DFAS LAR SETA Contract Actual
JPO TACOM In‐House Forecast
DFAS TACOM In‐House Actual
JPO LAR PMO In‐House Forecast
JPO LAR PMO In‐House Actual
JPO LAR Total Forecast
DFAS LAR Total Actual
Budget Authority
Oct‐16
31.7
9.0
9.5
9.4
0.4
0.4
13.8
13.8
55.3
32.6
427.9
Nov‐16
53.3
38.5
10.8
13.2
0.4
0.4
15.0
13.8
79.5
65.9
427.9
Dec‐16
75.0
60.7
12.2
14.4
0.5
0.4
16.3
13.8
103.9
89.3
427.9
Jan‐17
96.7
Feb‐17
118.3
Mar‐17
140.0
Apr‐17
159.1
May‐17
178.2
Jun‐17
197.3
Jul‐17
216.4
Aug‐17
235.5
Sep‐17
254.5
13.5
13.5
14.6
15.8
16.9
18.0
19.2
20.3
21.4
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
1.4
17.5
18.8
20.0
21.3
22.5
23.8
25.0
26.3
27.5
171.7
173.1
175.5
197.1
218.7
240.3
261.8
283.4
152.9
427.9
427.9
427.9
427.0
427.9
427.9
427.9
427.9
427.9
EVM 202
UNCLASSIFIED
Lesson 6-127
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
EVM 202
UNCLASSIFIED
Lesson 6-128
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
Integrated Program Management Report (IPMR) Format 1—As of 31 Dec 2016
EVM 202
UNCLASSIFIED
Lesson 6-129
LAR Vehicle Program Control Book—DEC 2016
EVM 202
Increda LAR Vehicle Documents
UNCLASSIFIED
Lesson 6-139
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
IPMR Format 2—As of 31 Dec 2016
EVM 202
UNCLASSIFIED
Lesson 6-131
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
IPMR Format 3—As of 31 Dec 2016
EVM 202
UNCLASSIFIED
Lesson 6-132
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
IPMR Format 4 EAC—As of 31 Dec 2016
EVM 202
UNCLASSIFIED
Lesson 6-133
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
IPMR Format 4 BAC—As of 31 Dec 2016
EVM 202
UNCLASSIFIED
Lesson 6-134
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
IPMR Format 5—As of 31 Dec 2016
Contract Summary
The contract is behind schedule (11%) and over cost (8%), projecting a positive variance at
completion (VAC) of $14.2M.
Formal Reprogramming (OTB/OTS)
There has been no reprogramming.
Estimate at Completion (EAC)
Best Case: $595.1M
Worst Case: $647.1M
Most Likely Case: $633.8M
Due to a later start in the contract than originally planned, many subsystems’ design efforts are
behind schedule. We project that once we get past the subsystem design packages and
drawings, we will be back on schedule and will finish under cost.
Undistributed Budget (UB)
There is no UB.
Management Reserve (MR)
Minor internal replanning was performed this period, with small amounts of budget and scope
removed from multiple Work Breakdown Structure (WBS) elements. $184K of work was
removed from the performance measurement baseline (PMB) and returned to MR.
Integrated Master Schedule (IMS)
Subsystem Design activities on multiple subsystems are slightly behind schedule. Additional
engineering support will correct this situation and meet critical milestone events.
Milestones are still on track to complete per baseline schedule.
An IMS Schedule Risk Analysis (SRA) was completed prior to the Integrated Baseline Review
(IBR). We will perform another SRA during the summer 2017 timeframe.
Format 3 Changes
No engineering change orders (ECOs) were processed during the month of Dec 2016.
However, to accommodate recovery in problem areas, some internal replanning of work was
completed during the month of December.
Format 4 Changes
Changes in Format 4 were minor and were made to accommodate schedule shifts due to
realignment of resources.
EVM 202
UNCLASSIFIED
Lesson 6-135
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
Cost and Schedule Variances
Schedule
Significant negative schedule variances were reported in the Armament, Body/Cab, Suspension
Steering, and System Engineering areas. These variances resulted from delays in design
activity for subsystems such as steering, and wheel and brake assemblies. Once the design
activities are complete, the schedule variance will greatly improve.
Cost
The areas of System Engineering, Armament, Suspension Steering, and Cooling are driving the
biggest cost variances. This is a result of attempts to utilize additional engineering expertise to
expedite design activities, while ensuring we achieve the Key Performance Parameters (KPPs).
Corrective Actions
To get back on schedule and complete the subsystem design activities, some internal
replanning budget shifts were implemented to reflect the changes in planned work.
At Completion Variances
With the current plan and additional resources, the program will realize efficiencies in finalizing
designs and test & integration activities. Despite small negative cost variances, we project to
underrun the contract at completion.
Variance Analysis
December 2016 Schedule Drivers
December 2016 Cost Drivers
EVM 202
UNCLASSIFIED
Lesson 6-136
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
1.1.10 Armament
Schedule Variance (SV): -$4.36M
Cost Variance (CV): -$1.4M.
During the Armament design phase, we found some minor issues in size and weight of the side
armor, as well as the gun barrel length. The planned redesign will get the program back on
schedule and meet requirements.
This has resulted in a schedule slip of 14 days and unexpected cost increase of $1.4M in labor
charges.
1.1.2.2 Body/Cab
SV: -$3.69M
CV: -$6.36M (within threshold)
The SV (-$3.69M) resulted from minor issues in size and weight of the side armor which
affected the Armament activities. Due to this issue, we had to relook at position of the armor on
the vehicle. Due to future efficiencies, this will recover in the next few months.
Following the redesign of the armor placement, the budget for this task was reduced by $6K this
period due to the change in future planned work. This is reflective of the efficiencies discovered
when looking at the plan.
1.1.5 Suspension/Steering
SV: -$3.27M
CV: -$1.3M
The steering and wheel systems are behind schedule by 4 weeks. This SV (-$3.27M) is caused
by subsystem relooks due to the armament issues. Due to the length of the gun barrel, the
probability of rollover while traversing slight grades was beyond limits. This rollover probability
required a relook at the steering subsystem to identify ways to accommodate turning radius,
while decreasing rollover threat.
The CV (-$1.3M) indicates that this system is costing more than was planned. A breakdown of
this variance indicates an impact on both material and labor.
Also this month, the budget at completion (BAC) for the Suspension/Steering system has been
reduced by $30K to account for change in scope associated with not requiring an additional
subsystem design review, as originally baselined. This is reflective of efficiencies.
EVM 202
UNCLASSIFIED
Lesson 6-137
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
1.4 System Engineering
SV: -$2.79M
CV: -$2.19M
The SV (-$2.79M) is tied to the inability to meet baselined subsystem design activity deadlines.
The performance of System Engineering activities is tied to other WBS elements. As those
activities failed to claim performance, the System Engineering element also cannot claim
performance. Once all subsystem design work is complete, this variance will improve.
The CV (-$2.19M) is attributable to unexpected labor needs and has two main contributors: 1)
an extensive design review requiring far more time than planned; and 2) a change in manpower
mix using more senior engineers when junior engineers were reallocated to support work in
other areas (Suspension/Steering).
The CV (-$2.19M) will correct itself due to anticipated cost efficiencies as we plan to underrun
this element. Junior engineers will return from working Suspension/Steering tasks this month,
reducing the actual cost for future planned work. Additional meetings and the delay of
acceptance test planning has the potential to delay System CDR if we attempt to reduce costs
by adjusting the labor skill mix again. No further corrective action identified.
EVM 202
UNCLASSIFIED
Lesson 6-138
LAR Vehicle Program Control Book—DEC 2016
Increda LAR Vehicle Documents
Contract Funds Status Report (CFSR)—As of 31 Dec 2016
DD FORM 1586
EVM 202
UNCLASSIFIED
Lesson 6-139
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
LAR Vehicle
Risk Management
Technical Metrics
Technical Performance Measurements (TPMs)
As of December 2016
EVM 202
UNCLASSIFIED
Lesson 6-140
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
Fuel Consumption December 2016 TPM
EVM 202
UNCLASSIFIED
Lesson 6-141
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
Operating Power December 2016 TPM
EVM 202
UNCLASSIFIED
Lesson 6-142
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
IR Signature December 2016 TPM
EVM 202
UNCLASSIFIED
Lesson 6-143
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
Power Package Weight December 2016 TPM
EVM 202
UNCLASSIFIED
Lesson 6-144
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
Mean Time Between Failure (MTBF) December 2016 TPM
EVM 202
UNCLASSIFIED
Lesson 6-145
LAR Vehicle Program Control Book—DEC 2016
System Engineering Documents
Estimates for Selected Performance KPPs—As of December 2016
Contract Specifications
KPPs
Contract Specification
Survivability
0.97
Grade
40⁰
Turning Radius
25 ft.
Range
385 mi.
Combat Vehicle Weight
13,000 kg
Interoperability
See CDD
Availability
0.97
MTBCMF
680
Milestones
Contract Specification
Subsystem CDR
FEB 2017
System CDR
SEP 2017
PPD
NOV 2018
Specification Estimates* Status as of 15 Dec 2016
Survivability – 0.97
Range – 385 mi.
Turning Radius – 25 ft.
Grade – 40°
•
•
•
•
•
•
•
•
EMD$ – $624,910
Average Production Unit Cost – $2.75M
Empty Vehicle Weight – 11,000 kg
Combat Vehicle Weight – 13,000 kg
KPPs Driving WBS Element Technical Risk
•
•
•
•
•
Survivability – Body/Cab, Testing, Power Package (IR Signature), & Communications
Range and Grade – Power Package
Gross Vehicle Weight – Power Package, Armament, Body/Cab, & Auxiliary Equipment
Turning Radius – Suspension/Steering and Armament
EMD$ – Driven by all
Average Production Unit Cost – Calculated using actual and projected recurring costs.
*All projections based on engineering design simulations and testing completed to date.
Acronyms and Abbreviations:
CDD – Capability Development Document
CDR – Critical Design Review
EMD – Engineering and Manufacturing
Development
EVM 202
MTBCMF – Mean Time between Critical Mission
Failures
MTTR – Mean Time to Repair
PPD – Production Prototype Delivery
UNCLASSIFIED
Lesson 6-146
Risk Assessment—As of December 2016
Risk
#
Risk Element
Risk
Level
1
Engine
High
2
Cooling System
High
3
Exhaust System
High
4
Suspension/Steering
Moderate
5
Power Package/Drive
Train
Moderate
6
Fuel System
Moderate
7
Controls/Instrumentation
Moderate
8
Subsystem Test
Moderate
9
Armament
Moderate
10
Integration, Assembly,
Test & Checkout
Moderate
11
Other Power Package
Components
Moderate
12
Hull/Frame/Body/Cab
Moderate
13
Auxiliary Automotive
Low
14
Communications
Low
15
Systems Engineering
Low
16
Program Management
Low
17
System Test &
Evaluation
Low
18
Training
Low
19
Data
Low
20
Peculiar Support
Equipment
Low
21
Initial Spares & Repair
Parts
Low
EVM 202
UNCLASSIFIED
Lesson 6-147
Exercise Instructions (Continued)
Group Task: Program Requirements Analysis Exercise
1. Using the LAR March 2016 APB, review and identify the LAR Vehicle threshold and
objective KPP values required for a production and deployment decision. (See the LAR
Data Package.)
2. Identify any discrepancies of these values with the LAR Vehicle contract requirements.
Team Whiteboard Assignments
•
•
•
Team A—APB Performance KPPs (Survivability and Grade)
Team B—APB Performance KPPs (Turning Radius and Range)
Team C—APB Schedule Parameters
• Team D—APB Cost Parameters
EVM 202
November 2017
Lesson 6-148
Group Task: Notional Data Validity Check Exercise
Complete the last two columns of this chart. Put 1 if the data needs to be corrected or 2 if the
finding needs to be investigated. Provide a brief explanation of your answer in the Notes/Actions
column.
Validity Check
Checks for
1 or 2
100% Complete
ACWP ≠ EAC
Elements 100% complete, but
EAC not equal to cumulative
actual cost
ACWP > LRE
Elements with cumulative actual
cost greater than LRE
ACWP > BAC
Elements where cumulative
actual cost exceeds BAC
ACWP increase
without BCWP
increase
For the current period, there is
ACWP with no BCWP
BCWP increase
without ACWP
increase
For the current period, there is
BCWP with no ACWP
BCWP > BAC
Elements where BCWP exceeds
BAC
BCWS > BAC
Elements where BCWS exceeds
BAC
CV < VAC
(EAC realism)
Elements where CVCUM is
negative, VAC is greater than
CVCUM
TCPI-LRE – CPICUM =
±0.10
(EAC realism)
Elements where TCPI-LRE differs
from CPICUM by more than ±.10
1. Need Correction
EVM 202
Notes/Actions
2. Need Investigation
November 2017
Lesson 6-149
Individual Task: EVM Chart Analysis Exercise
Program offices have received real IPMR data which when plotted would generate similar graphs. Answer each of the following
questions. Each question is stand-alone and not related to any other question. Review the charts and circle the underlined terms to
answer the questions.
Performance Measurement Baseline
$
BCWS
BCWP
ACWP
Time
Now
EVM 202
November 2017
Completion
Date
Lesson 6-150
1. When comparing the time phased-budget baseline with the earned value to date this project is ahead of or behind schedule,
indicating a favorable or unfavorable schedule variance. Based on the trend so far, the project will finish ahead of schedule,
or the project will finish behind schedule, or you can’t make any conclusion about when the project will finish without a
network schedule.
2. When comparing the actual costs with earned value, this project is overrunning or underrunning its budget, indicating a
favorable or unfavorable cost variance. If this trend continues to completion, the project cost will be more than or less than the
BAC, or you cannot tell without the contractor’s current EAC.
EVM 202
November 2017
Lesson 6-151
Cumulative Variance Chart LAR EMD Dec 2016, LAR
EVM 202
November 2017
Lesson 6-152
3. The BCWP is less than or greater than the ACWP.
4. The BCWP is less than or greater than the BCWS.
5. When will the contractor accomplish all of the planned work?
6. The BAC is less than or greater than the EAC.
EVM 202
November 2017
Lesson 6-153
Schedule and Cost Performance Indices Chart, LAR EMD Feb 2017, Suspension/Str
EVM 202
November 2017
Lesson 6-154
7. Has the contractor spent less than or more than planned to accomplish the tasks to date?
8. Has the contractor accomplished less work or more work than planned?
9. How would you explain the cumulative SPI?
10. How would you explain the cumulative CPI?
EVM 202
November 2017
Lesson 6-155
Cost/Schedule Variance Trends Chart, LAR EM 2016 Dec 2017, LAR
EVM 202
November 2017
Lesson 6-156
11. Has the contractor spent less than or more than planned to accomplish the tasks to date?
12. Has the contractor accomplished less work or more work than planned?
13. Can one project the value of the Cost Variance at the end of the project?
14. Can one project the value of the Schedule Variance at the end of the project?
15. Is the contractor predicting an underrun or overrun? Does this make sense?
EVM 202
November 2017
Lesson 6-157
Estimate at Completion Chart, LAR EMD Dec 2017, Prime Vehicle
EVM 202
November 2017
Lesson 6-158
16. Is the contractor projecting an underrun or overrun?
17. What does the EAC generated using CPI Forecast (Fct) represent?
18. What does the EAC generated using CPI*SPI Fct represent?
19. Does the contractor’s EAC make sense?
EVM 202
November 2017
Lesson 6-159
EAC Realism Chart, LAR EMD Dec 2017, LAR
20. What can one assess about the contractor’s EAC realism by analyzing this chart?
EVM 202
November 2017
Lesson 6-160
Group Task: Price at Completion (PAC) Exercise
Use the Dec 16 Empower Executive Summary contract data and Six Period Summary EAC
forecasts to compute a LAR Dec16 PAC.
From Empower Executive Summary DEC 2016
CONTRACT TYPE: CPIF
CONTRACT PERIOD: 10 JUN 2016 to 30
May 2019
NEGOTIATED COST: 647,115,000
EST AUTH UNPRICED: 0.0
CONTR BUDGET BASE: 647,115,000
TOTAL ALLOC BUDGET: 647,115,000
PERF MEASUREMENT BL: 634,392,000
MANAGEMENT RESERVE: 12,723,000
TARGET FEE $: 77,007,000
TARGET FEE %: 11.90
TARGET PRICE: 724,122,000
SHARE RATIO ABOVE: 50/50
SHARE RATIO BELOW: 30/70
MIN FEE: 32,356,000
MAX FEE: 97,067,000
From Empower Six Period Summary DEC 2016 Statistical and Independent Forecasts
SEPT 16
OCT 16
NOV 16
DEC 16
CUR CPI
695,263,116
627,188,503
632,012,885
837,762,144
3 PER AVG
647,115,000
627,188,503
629,718,175
704,648,242
6 PER AVG
647,115,000
627,188,503
629,718,175
704,648,242
CUM CPI
695,263,116
679,023,301
669,234,539
700,023,774
CPI*SPI
734,461,584
721,124,185
726,155,131
775,298,246
MICOM EAC
647,115,000
665,692,475
682,771,842
780,511,577
COST & SCH
691,410,872
684,774,365
686,606,598
712,219,541
PF
EAC
EVM 202
Over/Under
Fee
Adjustment
Adjusted
Fee
November 2017
Applied Fee
PAC
Do we have
enough
funds?
Lesson 6-161
Group Task: EVM Metrics Review Exercise
Using the data on the 31 Dec 2016 Integrated Program Management Report (IPMR) Format 1,
from the LAR Vehicle Data Package, answer the following questions.
1. What is the Negotiated Contract Cost (NCC)?
2. What is the Budget at Completion (BAC) for the contract?
3. How much is in Management Reserve (MR)?
4. Why do we need Current Period data and Cumulative to Date data?
5. What is the Cumulative Cost Variance (CV) at the contract level?
What does this CV tell us?
6. What is the Cumulative Schedule Variance (SV) at the contract level?
What does this SV tell us?
7. Calculate the Cumulative CPI.
What does this CPI tell us?
8. Calculate the Cumulative SPI.
What does this SPI tell us?
EVM 202
November 2017
Lesson 6-162
9. Using the data for the performance measurement baseline (PMB), calculate the Floor and
Ceiling Estimates at Completion (EACs).
Floor:
Ceiling:
10. What is the contractor’s most likely EAC?
11. Based on the EAC calculations in Question 9, is the contractor’s EAC reasonable? Why
or why not?
12. Calculate the To Complete Performance Index (TCPI) for the contractor’s most likely
EAC.
Why is this metric important?
13. What level of cost efficiency has the contractor been achieving?
14. Given the TCPI based on the contractor's EAC, what conclusion can you draw about the
contractor’s EAC?
15. What EAC would you recommend for the program and why?
EVM 202
November 2017
Lesson 6-163
IPMR/CFSR Comparative Analysis Exercise
Instructions
Compare the IPMR and the CFSR time-phased estimates.
1. Open the worksheet “IPMR CFSR Comparative Analysis Exercise” on Blackboard.
2. Locate the DEC 2016 LAR Vehicle Program IPMR Formats 1 and 3 and the CFSR in
your Student Guide.
3. Enter the following information into the table using the IPMR:
a. New program office PAC from Lesson 6 (At Completion)
b. IPMR Format 3 BCWS for Cumulative to Date, JAN 17 to JUN 17, SEP 17, SEP
18, and To Complete
c. SPICUM from Lesson 6 for JAN 17 to JUN 17, SEP 17, and SEP 18
d. EAC performance factor (CPICUM from Lesson 6) for JAN 17 to JUN 17, SEP 17,
and SEP 18
e. Estimate fee for Cumulative to Date, JAN 17 to JUN 17, SEP 17, and SEP 18
(Use two decimal places for SPICUM and CPICUM.)
4. For columns that have no reported data, leave the cells empty.
EVM 202
November 2017
Lesson 6-164
EVM 202 Lesson 7:
Tool Analysis Case
STUDENT GUIDE
CONTENTS
1. Learning Objectives and Additional References
2. Exercise Instructions
EVM 202
November 2017
Lesson 7-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 7-2
Learning Objectives and Additional References
Terminal Learning Objective
Analyze Integrated Program Management Report (IPMR) data using automated tools.
Enabling Learning Objectives
•
•
•
Analyze cost and schedule data
Analyze performance trends
Demonstrate the results of IPMR analysis
EVM 202
November 2017
Lesson 7-3
Exercise Instructions
Individual Task: Tools Analysis Case Study Briefing
(Use the Tools Analysis Case Study Briefing Template on Blackboard for this exercise.)
Your goal with this task is to understand the basic operations of EVM tools. You will use the
Tools Analysis Case Study Briefing Template and the tools listed under References on
Blackboard to complete this task. The job aids on Blackboard are available for your reference.
Use your team’s File Exchange on Blackboard under Team Groups > Team [A/B/C/D] > File
Exchange to complete this exercise.
File Exchange Instructions
To complete your Tools Analysis Case Study Briefing:
1. Select the Lesson 7 tab from the Course Menu on Blackboard.
2. Download the Tools Analysis Case Study Briefing Template under Task: Tools
Analysis Case Study Briefing.
3. Save the file to your computer.
4. Open the following under References:
a. Empower LAR Vehicle EMD 2016—DEC 16 Dataset
b. MS Project LAR Vehicle DEC 2016 Schedule
c. Empower, EVM Chart Analysis, and MS Project job aids (as needed)
5. Following the directions in each section of the template:
a. Answer the questions.
b. Copy the specified Empower or MS Project views onto your slides.
i. Use Empower line charts, not bar or column charts.
6. Save your updated file to your computer.
 Note: You will only need to brief one or more slides (i.e., one or more questions)
to the class.
7. When directed by the instructor, save a copy of your briefing (Select Save as…):
a. Name the file following this convention: Slide#_LastName_FirstName
(e.g., 01_Cohe_Miriam; 02_Powell_Rick; 17_Doe_John; etc.)
b. Delete all the slides except the one(s) you will brief.
c. Save your updated file to your computer.
EVM 202
November 2017
Lesson 7-4
8. Upload your final file to your team’s File Exchange:
a. Select the Team Groups tab on the Course Menu.
b. Select your team’s link under Groups.
c. Select File Exchange under Group Tools to upload and share files.
d. Select Add File to upload a file.
e. Select Browse My Computer to locate the file on your computer.
f. Enter a Name for your file in the Name field, using the naming convention listed
above.
g. Select Submit to post the file to your team’s File Exchange.
EVM 202
November 2017
Lesson 7-5
EVM 202 Lesson 8:
Integrated Product Team (IPT)
Analysis and Performance Case
STUDENT GUIDE
CONTENTS
1.
2.
3.
4.
Learning Objectives and Additional References
LAR Vehicle Scenario
Presentation Slides
Exercise Instructions
EVM 202
November 2017
Lesson 8-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 8-2
Learning Objectives and Additional References
Terminal Learning Objective
Assess IPT-level performance using program data and automated tools.
Enabling Learning Objectives
•
•
Assess program performance at the IPT level using the Integrated Analysis Model
Defend the findings and recommendations of the evaluation
Additional References
•
•
•
Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
Lesson 6 – Integrated Program Management (3-Step Process)
EVM 202
November 2017
Lesson 8-3
LAR Vehicle Scenario
Background
It is July 9, 2017. COL Paine has just returned from Command Day with the warfighters where
“The apparent lack of progress on the LAR Vehicle EMD contract” was a major discussion point.
The LAR Vehicle continues to be a number one priority for the Army, but as the war on terrorism
continues all programs are being scrutinized in the FY18 budget estimate submission.
GEN Moatars has scheduled a command-level LAR Vehicle program status review for next
week. COL Paine needs a status update and recommendations for a plan of action early this
afternoon to brief GEN Moatars. The most current data we have is the LAR EMD JUN 17
Empower database and the LAR JUN 2017 schedule.
BE PREPARED. COL Paine’s visit was, to say the least, THORNY!
EVM 202
November 2017
Lesson 8-4
September 2016
EVM 202—Lesson 8 Integrated Product Team (IPT)
Analysis and Performance Case
EVM 202
November 2017
Lesson 8-5
STEP 3 FORMULATE A PLAN OF ACTION
2
EVM 202
November 2017
Lesson 8-6
Formulate a Plan of Action
• Why: Need a way forward for issues uncovered during the
three-step Integrated Analysis Model
• What: Create action plans and recommendations for all issues
and report them in a format that supports leadership review
and action
• How:
– Create action plans
– Generate Integrated Product Team (IPT) Reports
3
EVM 202
November 2017
Lesson 8-7
Create Action Plans
• Why: To document the results of the integrated program
analysis in a format for leadership and oversight reporting
• What: Collect the key analysis decisions resulting from the
three-step Integrated Analysis Model and report them in a
format that supports leadership review and action
• How: Effective EVM provides early insight for PM actions:
– Update total program budget if necessary based on PAC
– Ask IPTs for technical scope and/or schedule requirements trade-off
opportunities
– Ensure aggressive risk mitigation activities and attention to problemsolving
– Reduce overall scope
– Obtain additional funding
4
EVM 202
November 2017
Lesson 8-8
Generate Integrated Product Team (IPT)
Reports
• Why: To document the results of the integrated program
analysis in a format for leadership and oversight reporting
• What: Collect the key analysis decisions resulting from the
three-step Integrated Analysis Model and report them in a
format that supports leadership review and action
• How:
– Collect, summarize, and report contract issues
– Collect, summarize, and report APB issues and program metrics
– Collect, summarize, and report EVM program cost and schedule
issues
– Collect, summarize, and report program financial issues
5
EVM 202
November 2017
Lesson 8-9
IPT Reports—Contract Issues
• Step 1.2 P0000 Status
– Confirm that the PMB reflects all contract modifications
• Step 1.3 Specification Issues
– Identify any contract specification issues that current TPMs forecast
will not be achieved
– Identify proposed technical solutions
• Step 1.4 Contract Delivery Issues
– Identify any contractual deliveries that the current network schedule
forecasts will not be met
– Identify proposed schedule solutions
• Steps 1.4 and 1.5 Contract Schedule and Cost Issues
– Identify any schedule and cost drivers that may be impacting the
contract (overtime to correct unfavorable SVs)
– Identify proposed solutions
• Step 3 Contractor Finance Issues
– Identify any cash flow, obligation, expenditure, and termination liability
issues that may exist on the contract
– Identify proposed solutions for these issues
6
EVM 202
November 2017
Lesson 8-10
IPT Reports—APB Issues and Program
Metrics
APB Issues
• Step 1.3 Performance KPPs
– Identify performance KPPs where their associated TPM forecasts
indicate they will achieve less than the required threshold and
proposed technical solutions
• Step 1.4 Schedule Parameters
– Identify any schedule parameters that the current network schedule
forecasts a completion date after the required ABP threshold date and
proposed schedule solutions
• Step 3 Cost Parameters
– Identify any cost overrun estimates that exceed current APB-approved
funding levels and proposed solutions
Program Metrics
• Step 1.1—EVMS Compliance and Integrated Baseline
Development
• Step 1.4—Baseline Execution Index
• Step 1.2—Contract Modifications and Baseline Revisions
• Step 2—SPIcum, CPIcum, and CPIcum vs. TCPI
7
EVM 202
November 2017
Lesson 8-11
IPT Reports—Earned Value Management
Status
• Step 1.2—Confirm the PMB is current and reflects all contract
modifications
– Identify inconsistent MR and UB issues
– Explain baseline adjustments and OTBs
• Step 1.4—Identify the top (3–5) schedule drivers using all
available data (network schedule, technical drivers, and EVM
schedule metrics)
• Step 1.5—Identify the top (3–5) cost drivers using all available
data (network schedule, technical drivers, EVM schedule and
cost metrics)
• Step 2—Determine at completion cost
– Provide an EAC range of costs consistent with observed and forecast
risks and EVM performance indexes
– Provide a most likely PAC
– When warranted (mature contracts) provide a risked-based EAC
8
EVM 202
November 2017
Lesson 8-12
IPT Reports—Financial Status
• Step 3—Confirm that PPBE R&P Forms provide adequate
resources to efficiently complete the program
• Step 3—Report current budget obligations and expenditures
and identify budget issues and proposed solutions
9
EVM 202
November 2017
Lesson 8-13
Step 3—Formulate a Plan of Action
Summary
• In Step 3: Formulate a Plan of Action, the EVM analyst and
the IPTs use the information gleaned from the other two steps
to recommend an action plan for the PM to:
– Meet schedule delivery dates
– Stay within budget
– Meet technical performance requirements
• Effective EVM provides early insight for PM actions, such as:
– Update total program budget, if necessary, based on PAC
– Ask IPTs for technical scope and/or schedule requirements trade-off
opportunities
– Ensure aggressive risk mitigation activities and attention to problemsolving
– Reduce overall scope
– Obtain additional funding
10
EVM 202
November 2017
Lesson 8-14
Exercise Instructions
Group Task: IPT Analysis and Performance Briefing
(Use the IPT Analysis and Performance Briefing Template on Blackboard for this
exercise.)
Your IPT will use the most current data to analyze your IPT’s assigned WBS element, or
elements, and prepare an IPT briefing for COL Paine.
At a minimum, the briefing should contain:
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Summarized IPT Earned Value Management (EVM) metrics and the EVM metrics for
each of your WBS elements
Three different IPT level charts that tell the story of what is happening
A history of your IPT (baseline stability, budget changes, schedule problems, etc.)
Critical path or float information:
o WBS elements and tasks that are on the critical path to Subsystem
Critical Design Review (CDR) and System CDR; OR
o The amount of float time for incomplete non-critical tasks leading up to
the Subsystem CDR, if none of your IPT’s WBS tasks are on the
critical path
Answers to the following questions:
o What is the scheduled date for the Subsystem CDR?
o What is the scheduled date for the System CDR?
A technical performance assessment
Three estimates at completion (EACs) (high, low, and most likely) and their associated
to-complete performance indexes (TCPIs)
A summary of issues and the way ahead or next steps
Use your team’s File Exchange on Blackboard under Team Groups > Team [A/B/C/D] > File
Exchange to complete this exercise.
File Exchange Instructions
To complete your team’s IPT Analysis and Performance Briefing:
1. Select the Lesson 8 tab from the Course Menu on Blackboard.
2. Download the IPT Analysis and Performance Briefing Template under Task:
Integrated Product Team (IPT) Analysis and Performance Briefing.
3. Save the file to your computer.
4. Complete each section of the IPT Analysis and Performance Briefing as a team.
5. To share draft files with your team members:
a. Select the Team Groups tab on the Course Menu.
b. Select your team’s link under Groups.
EVM 202
November 2017
Lesson 8-15
c. Select File Exchange under Group Tools to upload and share files.
d. Select Add File to upload a file.
e. Select Browse My Computer to locate the file on your computer.
f. Enter a Name for your file in the Name field.
g. Select Submit to post the file to your team’s File Exchange.
6. Upload your Final IPT Analysis and Performance Briefing to your team’s File
Exchange.
 Note: Name your file “Final IPT Analysis and Performance Briefing” to
distinguish it from any draft documents in your team’s File Exchange.
EVM 202
November 2017
Lesson 8-16
EVM 202 Lesson 9:
Integrated Program Management
Case
STUDENT GUIDE
CONTENTS
1. Learning Objectives and Additional References
2. LAR Vehicle Scenario
3. Exercise Instructions
EVM 202
November 2017
Lesson 9-1
This page is left blank intentionally.
EVM 202
November 2017
Lesson 9-2
Learning Objectives and Additional References
Terminal Learning Objective
Assess program performance using program data and automated tools.
Enabling Learning Objectives
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Assess program performance using the Integrated Analysis Model
Defend the findings and recommendations of the evaluation
Additional References
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Defense Acquisition Portal (DAP)
Acquisition Community Connection (ACC) EVM Community of Practice (CoP)
Lesson 6 – Integrated Program Management (3-Step Process)
EVM 202
November 2017
Lesson 9-3
LAR Vehicle Scenario
Background
The LAR Vehicle Program Engineering and Manufacturing Development (EMD) contract is well
underway, and the program is moving into final assembly and testing. As part of DAU’s
performance support mission, Colonel (COL) Paine has volunteered your team to help DAU
develop an integrated program management case study using the LAR Vehicle program's
Empower database and MS Project schedules.
COL Paine has requested that you prepare a briefing that details the LAR Vehicle program at a
snapshot in time. The briefing should correlate all elements of the Integrated Analysis Model. So
that future generations can learn from the LAR Vehicle program's success story, you will have to
evaluate and identify Acquisition Program Baseline (APB) issues based on the APBs that were
valid at the time.
EVM 202
November 2017
Lesson 9-4
Exercise Instructions
Graded Team Activity: Integrated Program Management Case
Study Briefing
(Use the Integrated Program Management Case Study Briefing Template on Blackboard
for this exercise.)
This is a graded group exercise. It counts for 20 percent of your total EVM 202 grade. Your
program office team will prepare a comprehensive contract status briefing.
As a team, apply the Integrated Analysis Model to evaluate your assigned month of LAR Vehicle
program data. Your team should review all available data and correlate cost, schedule, and
technical performance to determine critical Work Breakdown Structure (WBS) elements. Be
sure to review Integrated Program Management Report (IPMR) data, schedule performance
data, technical performance data, as well as your current APB. Determine the top cost and
schedule drivers and generate an independent estimate at completion (EAC) range. You will not
be required to compare the Contract Funds Status Report (CFSR) to the IPMR. However, you
should assess whether program execution is possible with existing budget resources.
Each team will analyze a different month of data. The completion of the case studies will
simulate the evolution of the LAR Vehicle program over time.
Your team will have access to the following data:
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LAR Vehicle program Empower database
LAR Vehicle program MS Project Integrated Master Schedule (IMS)
LAR Vehicle program Joint Program Office (JPO) documents, including APB, R-2, R-3,
R-4, and budget documents (See the LAR Vehicle Program Control Book for your
assigned month)
Increda IPMR Formats 1–5 and CFSR (See the LAR Vehicle Program Control Book for
your assigned month)
System Engineering Technical Performance Measure (TPM) charts (See the LAR
Vehicle Program Control Book for your assigned month)
Deliverables and Scoring
1. Deliver one copy of the Integrated Program Management Case Study Summary form
to the instructor and post your team’s briefing on Blackboard
4. Develop a briefing and be prepared to present it and address the following:
a. Top three cost drivers—3 Points awarded if two of your top three cost drivers
are consistent with the top five identified in the EVM 202 answer key
b. Top three schedule drivers—3 Points awarded if two of your top three
schedule drivers are consistent with the top five identified in the EVM 202 answer
key
EVM 202
November 2017
Lesson 9-5
c. Path to next two milestones—4 Points awarded if your critical path is
consistent with the EVM 202 answer key; if a milestone is not on the critical path,
you just need to say it is not on the critical path
d. Baseline Execution Index (BEI)—1 Point awarded if your BEI is within ± 0.1 of
the EVM 202 answer key
e. Three EACs (high, low, and most likely), the price at completion (PAC), and
the most likely To-Complete Performance Index (TCPI)—6 Points awarded if
most likely falls between the reasonable range identified in the EVM 202 answer
key, PAC is computed correctly, and corresponding TCPI is computed correctly
f. All APB issues—3 Points awarded for correct identification without omissions
when compared to the EVM 202 answer key
g. At least three different management charts that tell the story of what is
going on
5. Present the briefing to COL Paine and his staff.
 HINT: Pay attention to the briefings for previous time periods. You may wish to
update your brief accordingly.
Use your team’s File Exchange on Blackboard under Team Groups > Team [A/B/C/D] > File
Exchange to complete this exercise.
EVM 202
November 2017
Lesson 9-6
File Exchange Instructions
To complete your team’s Integrated Program Management Case Study Briefing:
1. Select the Lesson 9 tab from the Course Menu on Blackboard.
2. Download the Integrated Program Management Case Study Briefing Template
under Task: Integrated Program Management Case Study Briefing.
3. Save the file to your computer.
4. Complete each section of the Integrated Program Management Case Study Briefing as a
team.
5. To share draft files with your team members:
a. Select the Team Groups tab on the Course Menu.
b. Select your team’s link under Groups.
c. Select File Exchange under Group Tools to upload and share files.
d. Select Add File to upload a file.
e. Select Browse My Computer to locate the file on your computer.
f. Enter a Name for your file in the Name field.
g. Select Submit to post the file to your team’s File Exchange.
6. Upload your Final Integrated Program Management Case Study Briefing to your
team’s File Exchange.
 Note: Name your file “Final Integrated Program Management Case Study
Briefing” to distinguish it from any draft documents in your team’s File
Exchange.
EVM 202
November 2017
Lesson 9-7