Blues Chapter Earned Value Management System (EVMS) Ron Fradenburg Blues Chapter President 19 March 2013 For more information visit: 1 www.incose.org/educationcareers/certification/ © 2008 International Council on Systems Engineering CSEP Agenda Blues Chapter • EVMS History • INCOSE Perspective • DAU Gold Card CSEP 2 EVMS History Blues Chapter • After WWII Contract Performance Measurement (CPM) – Technology Advanced at a Tremendous Rate – Industries Produced Very Complex and Highly Technical Weapon Systems for Our Country's Defense – Government Need To Monitor And Track Defense Contractors Performance Increased • 1958 First Formal Contract Performance Measurement (Monitoring) Tool - Program Evaluation Review Technique (PERT) for USN Polaris Program • Next Added Cost Information to Arrive at PERT COST. • 1966 Air Force used Cost/Schedule Planning Control Specifications (C/SPCS or C-Specs) • 1967 DoD instituted Cost/Schedule Control Systems Criteria (C/SCSC) Contract Performance Measurement Standard. CSEP 3 EVMS History 2 Blues Chapter • • • • • • Weapon Systems Contracted to Defense Industry Government Asks for Bids (RFP) Technology Often State of the Art Proposed Designs Cost $B and Take Years to Complete Selected Programs are Baselined (APB, PMB) Flexibility in Performance, Cost, and Schedule with Continual Tradeoffs Demands Effective (CPM) • DOD Mandated Control Systems Guidelines - EVMS • Over 340 Major Programs 1940-1992 CSEP 4 EVMS History 3 Blues Chapter • Needed Improved Performance in Cost-Type Contracts • Both Government and Contractors Had Reservations – Deficiencies in Analyzing Performance Data – Variance Thresholds too Restrictive – Ask for Wrong Information – Training and Implementation Non-Standard – Not Supported by Top Management – Review Teams not Well Trained • Extensive Training Available • Wealth of Reference Material CSEP 5 EVMS History 4 Blues Chapter • C – Spec Five Groups (35 Criteria) 1966 1) Organization 2) Planning and Budgeting 3) Accounting 4) Analysis 5) Revisions and Access to Data • Today DCMA uses 32 Guidelines and Five Groups CSEP 6 DCMA Compliance Review Organization 1 2 3 4 5 Define autorized work Identify Prgram Organization Structure Company integration of EVMS subsystems with WBS and OBS Identify organization/function for overhead Identify WBS and OBS, create control accounts G/L 1 2 3 4 5 Guidelines Plannning, Scheduling & Budgeting 6 7 8 9 10 11 12 13 14 15 Sequential scheduling of work Identify interim measures of progress, i.e., milestones, products, etc. Establish time-phased budgets Identify significant cost elements within authorized budgets Identify discrete work packages All work package budgets and planning packages sum to control account Identify and control LOE busgets Establish overhead budgets by organization element Identify management reserve and undistributed budget Reconcile program target cost goal with sum of all internal budgets 6 7 8 9 10 11 12 13 14 15 Accounting Considerations 16 17 18 19 20 21 Record direct costs from accounting system Summarize direct costs into WBS without allocation Summarize direct costs into OBS without allocation Record indirect costs Identify unit costs, equivalent unit costs or lot costs Accurate material accumulation by control account; EV measurement at right time; full accounting of material 16 17 18 19 20 21 Blues Chapter •DCMA Designates 16 Core / Foundation Guidelines •Non Compliance with any Core Guideline will Fail Contractor’s EVM Compliance Review* *DCMA Presentation to NDIA PMSC, Aug. 2010 Ingalls Audit Based on ANSI/EIA 748B EVMS Management Systems June 2007 Reference: NDIA Planning and Scheduling Excellence Guide (PASEG) 18 May 2010 Analysis and Management Reports 22 23 24 25 26 27 Control Account monthly summary, Identification CV and SV Explain significant variances Identify and explain indirect cost variances Summarize data elements and variances thru WBS/OBS for management Implement management actions as a result of EVM analysis Revise EAC based on performance data; calculate VAC 22 23 24 25 26 27 Revisions and Data Management 7 28 29 30 31 32 Incorporate authorized changes in timely manner Reconcile budgets with prior budgets Control retroactive changes Prevent all but authorized budget changes Document changes to the PMB 28 29 30 31 32 CSEP Agenda Blues Chapter • EVMS History • INCOSE Perspective • DAU Gold Card CSEP 8 Systems Engineering Program Management Systems Engineering Systems Implementation ●Needs and Opportunity Analysis ●Operational Concept Development ●System Scoping and Requirements Development Blues Chapter ●Production Planning and Analysis ●Production Line Preparation ●Production/ Construction ●Lifecycle Planning and Estimating ●System Integration ●Business ●Tradeoff Analysis, ●QA, V&V, Continuous ●Production Control Case Modeling and Process Improvement Analysis Simulation ●Change Analysis ●Supply Chain ●Technical Baseline Management, CM Management ●Records & ●Technical and Reporting Business Risk Analysis ●Systems ●Testing ●Systems Engineering Implementation Management Management ●Work Breakdown Structure ●Program Metrics ●Architecture Definition Developed for BKCASE with Changes 9 ●Staffing, Organizing, Directing ●Program Baseline ●Integrated Master Schedule ●Cost, Schedule, Performance, and Risk Monitoring and Control (EVMS) ●Operations Planning and Preparation (Deployment) ●Operations Management CSEP Project/ Systems Management Program Management Challenges Blues Chapter CSEP Agenda Blues Chapter • EVMS History • INCOSE Perspective • DAU Gold Card CSEP 11 DAU Gold Card Blues Chapter CSEP 12