Deltek Insight 2010: Earned Value Management is a “System of Systems”
 

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  • At conclusion of slide, mention that charge numbers are opened at the control account level or lower.Two important aspects to cover now: the role of the Control Account Manager and the Control Account

Deltek Insight 2010: Earned Value Management is a “System of Systems” Presentation Transcript

  • 1. EPM-209 Earned ValueManagement is a “System ofSystems”Delivered by:Kelly Meassick, PMP,Charter Performance Management Group
  • 2. Agenda• Overview of Earned Value Management• Processes: Project Management Using Earned Value• Technology: Tools and Interfaces• People: Key Roles• EVMS Implementation: Lessons LearnedCopyright © 2010 Deltek, Inc. 2
  • 3. Overview of EarnedValue Management
  • 4. Overview of EVM• Overview of Earned Value Management – Overview – ANSI /EIA 748 Earned Value Management System Standard – EVMS is a “System of Systems”Copyright © 2010 Deltek, Inc. 4
  • 5. Earned Value Management is…• Earned Value Management Is a PROJECT MANAGEMENT METHODOLOGY that Uses Objective Measures that Enable Project Managers to Objectively Analyze and Report Project Performance• EVM Is Used to Identify, Communicate and Manage the Resource Effect of Technical and Schedule Problems• Earned Value Management Provides the Ability to Compare COST of the Work Completed with the VALUE of the Work CompletedCopyright © 2010 Deltek, Inc. 5
  • 6. Completing the Picture Estimate At Complete 22 } (EAC) 20 MR 18 Management Actual costs Reserve 16 (ACWP) 14$ 12 Budgeted costs 10 (BCWS) 8 BAC 6 Earned Value Budget at 4 (BCWP) Complete 2 0 Days 2 4 6 8 10 12 14 16 18 20 Report Date Completion dateCopyright © 2010 Deltek, Inc. 6
  • 7. NDIA ANSI/EIA 748 EVMS Standard 5 Guidelines Organization 19 Typical Attributes ≈137 Typical Attributes Planning, Scheduling 10 Guidelines 32 Guidelines and Budgeting 36 Typical Attributes 6 Guidelines Accounting 26 Typical Attributes Analysis and 6 Guidelines Management Reports 20 Typical Attributes Revisions and Data 5 Guidelines Maintenance 36 Typical AttributesCopyright © 2010 Deltek, Inc. 7
  • 8. EVMS is a “System of Systems” Technology Scheduling Tool (i.e. MS Project) EVM Tool Accounting (i.e. Cobra) System (i.e. Cost Point)Copyright © 2010 Deltek, Inc. 8
  • 9. EVMS is a “System of Systems” Processes Reports (Contract Scope Definition, Performance Report, Requirements, Key Events Variance Analysis Report) Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) EVM data, Reports, Dependencies Metrics Analytics Schedule Dates Hours by Project & Budgets Control Acct Plans (CAP) Task Schedule Status PMB EVM Tool Accounting (i.e. Cobra) Program Logs Material, ODC, System Charge Codes Subcontractor (i.e. Cost Point) EAC / ETC Costs Actual and Accrued CostsCopyright © 2010 Deltek, Inc. 9
  • 10. EVMS is a “System of Systems” People Project Reports (Contract Scope Definition, Performance Report,Management Variance Analysis Report) Team Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) EVM data, Reports, Dependencies Metrics Analytics Schedule Dates Hours by Management, Project & Budgets Control Acct Plans (CAP) Stakeholders Task Schedule Status PMB EVM Tool Accounting (i.e. Cobra) Program Logs Material, ODC, System Charge Codes Subcontractor (i.e. Cost Point) EAC / ETC Costs Actual and Accrued Costs Technology – Processes – PeopleCopyright © 2010 Deltek, Inc. 10
  • 11. Processes: Project ManagementUsing Earned Value
  • 12. Processes• Processes: Project Management Using Earned Value – Proposal/Project Concept Phase – Project Initiation/Baseline Establishment Phase – Project Execution/Performance PhaseCopyright © 2010 Deltek, Inc. 12
  • 13. Project Lifecycle• Earned Value “Work Products” Are Developed, Controlled and Maintained throughout the Project Lifecycle Project Proposal / Initiation / Execution / Project Baseline Performance Concept Establishment Phase Phase PhaseCopyright © 2010 Deltek, Inc. 13
  • 14. Proposal Phase Outputs: Organization Output: Responsibility Statement of Work Breakdown Structure (OBS) Assignment Matrix (RAM) or Contract ModResponsibilities Identify Project Organizations and SubcontractorsPM / CAM Define Assign Control Requirements, Identify Account Key Events and Risks Develop Master Submit Identify Responsibility Prepare Initial Deliverables Schedule; Proposal Manageable Work Time-Phased Estimate Segments Estimates ResourcesProject ControlsResponsibilities& Scheduling Outputs: SOW/WBS Outputs: Integrated Output: Time-phased Matrix, WBS Index, Master Schedule (IMS), Estimates (incl. Sub and Output: Integrated WBS Dictionary Subcontractor Schedules Material estimates) Master Plan (IMP) Copyright © 2010 Deltek, Inc. 14
  • 15. Baseline Establishment Phase Outputs: Updated SOW/WBS Matrix, Output: Resource Contract Award WBS Index and Dictionary Allocation Notices, UB and MR Establish Project Charge Codes Responsibilities PM / CAM Authorize Project Update Scope, Allocate Key Events, Resources Deliverables, Update Risk Work Segments Register Develop Control AccountProject Controls Plans Create ProjectResponsibilities Update Baselines& Scheduling Schedules Output: Updated Output Performance Output: Updated Integrated Outputs: Updated IMS Measurement Output: Contract Control Account Master Plan (IMP) & Sub Schedules Baseline (PMB) Approval Notification Plans (CAP) Copyright © 2010 Deltek, Inc. 15
  • 16. Performance Measurement Baseline 1. Define The Work Contract Budget Base 2. Schedule the Work PMB 3. Allocate Budgets Dollars 100 40 60 15 25 30 TimeCopyright © 2010 Deltek, Inc. 16
  • 17. Developing the PMB• Develop the Scope Baseline: – Authorize the Project – Define the Project Scope, Major Deliverables, and Milestones – Develop Work Breakdown Structure – Identify Responsible and Performing Organizations – Identify Control Accounts and Assign Responsibility• Develop the Schedule and Budget Baselines: – Develop the Project Schedules – Develop Control Account Plans (CAPs) – Integrate CAPs into Detailed Project Schedules – Approve the Performance Measurement BaselineCopyright © 2010 Deltek, Inc. 17
  • 18. Scope Baseline Development Outputs: Organization Output: Responsibility Output: Control Output: Performance Statement of Breakdown Structure (OBS) Assignment Matrix (RAM) Account Plans Measurement Work (CAP) Baseline (PMB)Responsibilities Identify Program Organizations and SubcontractorsPM / CAM Define Assign Control Develop Requirements, Identify Develop Account Performance Key Events and Risks Control Identify Responsibility Measurement Deliverables Account Manageable Develop Develop Baseline High-Level Plans Detailed Work Segments Schedules SchedulesProject ControlsResponsibilities& Scheduling Outputs: SOW/WBS Outputs: High-Level Output: Integrated Matrix, WBS Index, Output: Risk Outputs: High- Schedule, Integrated Master Plan (IMP) WBS Dictionary Register Level Schedule Master Schedule (IMS) Copyright © 2010 Deltek, Inc. 18
  • 19. Scope Baseline• Step 1: Authorize the Project• Step 2: Define the Project Scope, Major Deliverables, and Milestones• Step 3: Develop the Work Breakdown Structure (WBS)• Step 4: Identify Responsible & Performing Organizations• Step 5: Identify Control Accounts & Assign ResponsibilityCopyright © 2010 Deltek, Inc. 19
  • 20. Schedule & Budget Baseline Development Outputs: Organization Output: Responsibility Output: Control Output: Performance Statement of Breakdown Structure (OBS) Assignment Matrix (RAM) Account Plans Measurement Work (CAP) Baseline (PMB)Responsibilities Identify Program Organizations and SubcontractorsPM / CAM Define Assign Control Develop Requirements, Identify Develop Account Performance Key Events and Risks Control Identify Responsibility Measurement Deliverables Account Manageable Develop Develop Baseline High-Level Plans Detailed Work Segments Schedules SchedulesProject ControlsResponsibilities& Scheduling Outputs: SOW/WBS Outputs: High-Level Output: Integrated Matrix, WBS Index, Output: Risk Outputs: High- Schedule, Integrated Master Plan (IMP) WBS Dictionary Register Level Schedule Master Schedule (IMS) Copyright © 2010 Deltek, Inc. 20
  • 21. Schedule & Budget Baselines• Step 1: Define the IMS Framework• Step 2: Develop Control Account Plans• Step 3: Select an Earned Value Technique (EVT)• Step 4: Develop the Detailed Project Schedules• Step 5: Validate the Time-Phase BudgetsCopyright © 2010 Deltek, Inc. 21
  • 22. Control Account Planning Work Breakdown Structure Master Vehicle Transmission Frame Assembly Suspension Test Intermediate Frame Fenders Seats Project Quality Mfg Fender Body Fender Rods Control Eng Mech Design Account Detail $1000 Project Control Design Account FY 07 Elec Design Eng Mfg Test $2500 O N D J F Control Control $ $ $ $ Drafting Design Account Quality Account $1200 $ $ $ $ $4000 $ $ $ $ 100% of work is planned in control accounts $ $ $ $Copyright © 2010 Deltek, Inc. 22
  • 23. Responsibilities Responsibilities Project Execution Phase Outputs: Internal Mgt Output: Revised Reports and CPR; Accounting Estimates Manage Accumulate Corrective Action Report Overhead Costs Rates ManageProject Controls PM / CAM Work Subcontractors & Authorizations Inter-company Develop and Organizations Analyze Maintain Measure Analyze Performance Program Performance; Variances Reports; Develop Logs Status Forecast ETCs; Corrective ActionResponsibilities Schedules Analyze EACs Plans& Scheduling Outputs: Work Outputs: Output: Authorization Subcontractor cost Output: Updated Output: Variance Output: Updated Updated Forms and schedule status CAPs Analysis Report Schedules Program Log Copyright © 2010 Deltek, Inc. 23
  • 24. Measuring Performance Define the Work Plan the Work Work the Plan Collect Results Change Control Measure Performance Against the Plan Institute Appropriate Analyze Variances Corrective ActionsCopyright © 2010 Deltek, Inc. 24
  • 25. Measuring Performance• Step 1: Status Control Account Plans and Schedules – Update Schedules – Update Status of Work Packages – Update Estimates to Complete• Step 2: Calculate Earned Value• Step 3: Accumulate and Integrate Actual Costs• Step 4: Calculate Variances, Indices and Estimate at Completion (EAC) CostsCopyright © 2010 Deltek, Inc. 25
  • 26. EVM Analysis Objectives• Current Status Determination – Where are we today• Forecast for the Future – What is the estimated cost at completion• Identify Trends (no surprises) – Where are we headed• Indications for Management ActionCopyright © 2010 Deltek, Inc. 26
  • 27. EVM Report ExampleControl Account Cumulative Work Package BCWS BCWP ACWP CV SV1.1 11100 Project Management 1.1.1 Project Management and Control 82,445 82,445 65,168 17,277 0Control Account Totals: 82,445 82,445 65,168 17,277 01.2.1 13100 ABC Solution Design, Development & Verification 1.2.1.1 ABC System Design 198,672 198,672 146,769 51,903 0 1.2.1.2 ABC Solution Implementation 115,741 19,592 73,469 -53,877 -96,149 1.2.1.3 System Verification 55,450 19,394 9,824 9,571 -36,055 1.2.1.4 ABC User Manual Update 13,631 133 0 133 -13,498 1.2.1.5 Alternative Test Scenario and Support 0 0 2,436 -2,436 0Control Account Totals: 383,494 237,791 232,497 5,294 -145,7031.2.2 13100 ABC System Production Deployment 1.2.2.1 Deployment Preparation 4,095 464 0 464 -3,632 1.2.2.2 Deployment Support 0 0 0 0 0 1.2.2.3 Post-Deployment Support 0 0 0 0 0Control Account Totals: 4,095 464 0 464 -3,632Grand Total 470,035 320,700 297,665 23,035 -149,334 Copyright © 2010 Deltek, Inc. 27
  • 28. EVM Report ExampleControl Account Work Package EVT BAC EAC VAC1.1 11100 Project Management 1.1.1 Project Management and Control LoE 110,514 66,050 63,464Control Account Totals: 110,514 66,050 44,4641.2.1 13100 ABC Solution Design, Development & Verification 1.2.1.1 ABC System Design 50-50 198,672 146,769 51,903 1.2.1.2 ABC Solution Implementation User Def 115,741 211,546 -95,805 1.2.1.3 System Verification 30-70 75,276 48,441 26,835 1.2.1.4 ABC User Manual Update User Def 13,631 44,277 -30,645 1.2.1.5 Alternative Test Scenario and Support 50-50 0 53,105 -53,105Control Account Totals: 403,320 504,138 -100,8181.2.2 13100 ABC System Production Deployment 1.2.2.1 Deployment Preparation % Comp. 10,238 18,618 -8,380 1.2.2.2 Deployment Support % Comp. 17,103 17,103 0 1.2.2.3 Post-Deployment Support % Comp. 1,570 1,570 0Control Account Totals: 28,912 37,291 -8,380Grand Total 542,746 607,479 -64,733Copyright © 2010 Deltek, Inc. 28
  • 29. Technology: Tools and Interfaces
  • 30. Technology• Technology: Tools and Interfaces – Using Deltek’s Cobra as the EVM engine – Integrating Cobra with Microsoft Project or Primavera P6 – Integrating Cobra with Cost Point or GCS Premier – Enhancing analysis and reporting with wInsightCopyright © 2010 Deltek, Inc. 30
  • 31. Relationship Between Work Products Integrated Master Cross - referenced Plan (IMP) Statement of Work Events Work Breakdown Cross - referenced Accomplisments Structure (WBS) Criteria Integrated Master Schedule (IMS) EVM Tool / WBS Performance Management Responsibility Control Accounts System (Cobra) Assignment Matrix (RAM) Work Packages Iterative Risk Assessments Tasks Organization Risk Mitigation Breakdown Structure Action Plans (OBS) Supplemental ScheduleCopyright © 2010 Deltek, Inc.
  • 32. Integrating Technology Project Reports (Contract Scope Definition, Performance Report,Management Variance Analysis Report) Team Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) EVM data, Reports, Dependencies Metrics Analytics Schedule Dates Hours by Management, Project & Budgets Control Acct Plans (CAP) Stakeholders Task Schedule Status PMB EVM Tool Accounting (i.e. Cobra) Program Logs Material, ODC, System Charge Codes Subcontractor (i.e. Cost Point) EAC / ETC Costs Actual and Accrued Costs Technology – Processes – PeopleCopyright © 2010 Deltek, Inc. 32
  • 33. Detail Project ScheduleCopyright © 2010 Deltek, Inc. 33
  • 34. Time-phased BudgetCopyright © 2010 Deltek, Inc. 34
  • 35. Schedule Integration into Cobra Scope Definition, Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) Dependencies Schedule Dates Budgets Control Acct Plans (CAP) EVM Tool (i.e. Cobra) PMBCopyright © 2010 Deltek, Inc. 35
  • 36. Schedule Integration into Cobra Scope Definition, Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) Dependencies Schedule Dates Budgets Schedule Status Control Acct Plans (CAP) EVM Tool (i.e. Cobra) PMBCopyright © 2010 Deltek, Inc. 36
  • 37. Actual Cost Integration into Cobra Scope Definition, Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) Dependencies Schedule Dates Hours by Project & Budgets Task Schedule Status PMB EVM Tool Accounting (i.e. Cobra) Program LogsMaterial, ODC, System Charge CodesSubcontractor (i.e. Cost Point) EAC / ETCCosts Actual and Accrued Costs Copyright © 2010 Deltek, Inc. 37
  • 38. wInsight Enhancement Scope Definition, wInsight Requirements, Key Events Work Breakdown Structure (WBS) Scheduling Tool Manageable Work Segments, (i.e. MS Project) EVM data, Reports, Dependencies Metrics Analytics Schedule Dates Hours by Project & Budgets Task Schedule Status PMB EVM Tool Accounting (i.e. Cobra) Program LogsMaterial, ODC, System Charge CodesSubcontractor (i.e. Cost Point) EAC / ETCCosts Actual and Accrued Costs Copyright © 2010 Deltek, Inc. 38
  • 39. Project Data in CobraCopyright © 2010 Deltek, Inc. 39
  • 40. People: Key Roles
  • 41. People• People: Key Roles – The Control Account Manager’s Role – The Project Manager’s Role – The Project Control Analyst’s RoleCopyright © 2010 Deltek, Inc. 41
  • 42. Control Account ManagerResponsible and accountable for planning and Companyexecuting the scope of the control accountsassigned within the designated schedule and Eng Mfg Testbudget Design QualityDetail plans the scope into discrete workpackages, level of effort and planning packagesthat support the scheduleSubdivides the allocated budget to the workpackages so that it is time-phased and reflectsthe way in which actual costs are expected to beincurred Responsible and accountable Subdivides the scopeIdentifies and obtains specific resources plans the allocated DetailThe CAM is the into forAssignsthe work packages budget work obtains valuethe planning and executing an earnedrequired to perform the work discreteto and packages, level Identifies the control accounts specific methodof is time-phased and scope it each work package soPROJECT MANAGER that to required to perform resources and planning of effort assigned withinwhich the that supports assigned the reflectshis the performance for the way in packages that supportAssigns an performance measurement designated work the schedule and actual (time-phased budget) goals costs are expected to schedule scope, schedule and costtechnique to each work package that supportsthe performance goals (time-phased budget) be budget incurred 42
  • 43. Project Manager• Review Internal Monthly Performance Reports• Review All Variance Analysis Reports (VARS) with CAMS and Program Analysts – Determine if performance trends for any control account warrant a VAR – Determine if any activities’ cost, schedule or technical performance risk warrant a VAR even though the threshold for the control account may not have been exceeded• Review and Approve Corrective Action Plans Initiated by CAMS with Follow-up to Closure• Review of the Run-out Efficiency snd Performance Efficiency Changes Required to Meet the Current ETC PlanCopyright © 2010 Deltek, Inc. 43
  • 44. Project Control Analyst• Work with the CAMs to status schedule activities terms• Facilitate the transfer of schedule status from the scheduling system to the EVM system• Facilitate the transfer of actual costs from the accounting system to Cobra• Work with CAMs to assess the status and trends for technical, schedule, and cost performance• Support the CAMs in performing Variance Analysis• Maintain Contract Budget Base, Management Reserve, and Undistributed Budget logsCopyright © 2010 Deltek, Inc. 44
  • 45. EVMS Documentation• The Backbone of the EVMS Is the Company’s EVM System Description and the Associated Policies, Procedures, Templates, Desktop Instructions Policies, Procedures and TemplatesEarned Value Management System Description Program Baseline Control & Maintenance P & PEVMS Roles and Responsibilities Guidelines Program Status Updates P & PProgram Integration P & P Material Management P & PProgram Directives Guidelines Indirect Cost Management P & PWork Breakdown Structure (WBS) P & P Performance Analysis and Reporting P & POrganization Breakdown Structure (OBS) P & P Integrated Master Plan (IMP) P & PResponsibility Assignment Matrix (RAM) P & P Subcontractor Management P & PProgram Scheduling P & P Material Management P & PControl Account Planning P & P EVMS Surveillance P & PRates P & P EVMS Surveillance PlanFiscal Calendar P & P Undistributed Budget P & PSubcontractor Management P & P Management Reserve P & PPerformance Measurement Techniques P & P Actual Cost Accumulation P & PWork Authorization P & PCopyright © 2010 Deltek, Inc. 45
  • 46. EVMS Documentation (cont.)• Sample Desktop Work Instructions:Desktop Work InstructionsProgram Scheduling Work InstructionsControl Account Plan Work InstructionsProgram Baseline Control and Maintenance Work InstructionsProgram Status Updates Work InstructionsPerformance Analysis and Reporting Work InstructionsRates Work InstructionsFiscal Calendar Configuration in Cobra Work InstructionsCopyright © 2010 Deltek, Inc. 46
  • 47. EVMS Training Modules• Sample Training Modules: EVMS Training ModulesWork Breakdown Structure (WBS) Subcontractor ManagementOrganization Breakdown Structure (OBS) Undistributed BudgetResponsibility Assignment Matrix (RAM) Actual Cost AccumulationControl Account Planning EVMS SurveillanceFiscal Calendar Indirect Cost ManagementIntegrated Master Plan (IMP) Labor RecordingManagement Reserve Material ManagementPerformance Measurement Techniques Performance Analysis and ReportingProgram Integration Program Baseline Control & MaintenanceProgram Scheduling Program Directives GuidelinesProgram Status Updates Work AuthorizationPerformance Measurement Baseline Control Account Manager (CAM)Development Certification TrainingCopyright © 2010 Deltek, Inc. 47
  • 48. EVMS Implementation:Lessons Learned
  • 49. Lessons Learned• Potholes to Avoid: Procrastination Delaying the EVMS implementation or making it dependant on the award of a contract Complacency Not being current on EVM requirements Unrealistic Expectations Underestimating the time and resources needed to implement an ANSI-compliant EVMS Wandering Aimlessly Not having clear EVMS goals and implementation roadmap Underestimating Cultural Impact Not planning for the organizational change impact that the EVMS will have Lack of Discipline Not following up the EVMS implementation with a formal surveillance program Business as Usual Not managing the EVMS relationship with your customerCopyright © 2010 Deltek, Inc. 49
  • 50. Questions• Kelly Meassick, PMP – (256) 755-0449 – Kelly.Meassick@CharterPerformance.comCopyright © 2010 Deltek, Inc. 50