This document discusses the implementation of portfolio management at the Department of Energy (DOE) and National Nuclear Security Administration (NNSA) to improve budget transparency and justification. It describes how the Planning, Programming, Budgeting, and Evaluation (PPBE) process was strengthened by developing a work breakdown structure and implementing a portfolio management system called the Objective Portfolio Planning and Management (OPPM) tool. The OPPM tool collects project data, allows for analysis of costs, dependencies and risks, and supports management reviews to provide full visibility and justification of budget requests. This enhanced transparency addresses prior Government Accountability Office findings about unknown total facility costs and unidentified stockpile services costs.

1. Portfolio Management and the PPBE Process
at the Department of Energy
April 2012

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3. Understanding the Department of Energy
Budget Formulation and Execution
The Planning, Programming, Budgeting
and Evaluation (PPBE) Process

4. What is PPBE?
• A process utilized for standardized budget formulation and
execution within Department of Energy (DOE) and National
Nuclear Security Administration (NNSA)
• First formalized at the Department of Defense (DOD) and is
currently used by other Agencies at varying degrees of
implementation.

5. Reality:
HOW it will get done
• Fiscally CONSTRAINED
• Identifies emerging requirements
• Re-balance based on competing
requirements
Validation:
Are we ON TRACK
•Administrator/Secretary Reviews
•OMB Reviews
•Technical Reviews
Vision:
WHAT needs to get done
•Fiscally UNCONSTRAINED
•Defines high level scope
•Identifies Priorities
Justification & Distribution:
WHY it needs to get done
• Finalize after OMB pass back and
prioritization
•Run budget scenarios
•Prepare Congressional Justification
The PPBE Process
PLANNING PROGRAMMING
EVALUATION BUDGETING

6. June 2010 GAO Findings within NNSA
NNSA (National Nuclear Security Administration) was mandated by the Government
Accountability Office (GAO) to strengthen their program and project management
capabilities within the Weapons Activities mission area.
• Cannot Accurately Identify the Total Costs to Operate and Maintain Weapons
Activities Facilities and Infrastructure, and These Costs Likely Significantly Exceed
the Budget Justified to Congress
• NNSA Does Not Fully Identify or Estimate the Total Costs of the Products and
Capabilities Supported through Stockpile Services R&D and Production Activities.
• Operations of Facilities and Stockpile Services Costs Are Unlikely to Be Significantly
Affected by Reductions in Stockpile Size, and NNSA Lacks Cost Information to Help
Justify Planned Budget Increases.

7. Budget Transparency before Portfolio Management
Mission
Strategic Themes
Goals
Decisions were based on high-level goals
and assumptions based on Program
Manager knowledge without sufficient
data to justify decisions

8. NNSA Weapons Activities Budget

9. NNSA and Portfolio Management
Two major initiatives were undertaken to streamline
the PPBE process and account for total cost of
mission product and capabilities.
– Developed a standard national work breakdown structure
(WBS)
– Implemented a portfolio management system (OPPM) as
part of an Enterprise Portfolio Analysis Toolset

10. OPPM and the NNSA PPBE Process

11. How OPPM supports PPBE
• Collects planning and program
requirements data
• Summarizes work scope by mission, goals
and priorities
• Provides workflows to facilitate
management reviews of approvals of
budgetary requests
• Supports analysis of dependencies and
risk/return scenarios.
• Seamlessly integrates into various
Enterprise systems
• Supports integration of project schedules
for planning, dependency analysis, and
health of investments
OPPM
PPBE
P6
OBIEE

12. Capabilities PPBE Requirements Addressed
Forms Collect budgetary scope information to be used for creating groupings of related
activities, facilitating approval workflows, and decision support analysis.
Groupings/
Portfolios
Summarize identified activities by key mission, objectives, priorities, location of work,
capabilities or any other budgetary data point collected.
Workflow Provide the ability for management approval at any requested level, maintain cyclical
reviews and approvals of budgetary requests.
API’s/Web
Services
Analyze dependencies and risk/return scenarios to make informed decisions on where
funding should be applied
Integrate into Enterprise accounting and other systems for business reporting
Analysis/
OBIEE Integration
Integrate seamlessly with project management software to what work can be
performed in what timeframe for planning, dependency and heath of investment
analysis
OPPM PPBE Capability Analysis

13. Budgetary Transparency with Portfolio Management
Decisions can be based on agreed
upon low level detailed scope,
requirements and priorities
providing adequate justification to
INCREASE budgetary funding.
Mission
Portfolios
Theme
Portfolios
Activities
WBS
Portfolios
Goal
Portfolios
•WBS
•Work Scope
•Funding Requirements
•Risk
•Priority
•Dependencies
•FTE counts
•Capability and product alignments

14. The Power and Flexibility of Formulation Portfolios
Mission
Theme 1
Goal 1A Goal 1B
WBS 1B.1 WBS 1B.2
WBS
1B.1.1
Item
WBS
1B.1.2
WBS
1B.1.2.1
Item
WBS
1B.1.2.2
Item
Goal 1C
Item
Goal 1D
Theme 2
Goal 2A
Goal 2B
Goal 2C
Item
One minute change to a detail at
the lowest level of work scope will
impact all parent portfolios up to
the mission portfolio.Item
WBS
1B.1.2.1
WBS
1B.1.2
WBS 1B.2WBS 1B.2
Goal 1B
Theme 1
Mission

15. February 2012 Recent GAO Testimony

16. Benefits of using OPPM for PPBE
• Flexibility in linking mission to work scope activities
• Ability to identify key activities and group them in
various portfolios to identify true cost of capabilities
and products produced in an organization
• Budget transparency which enhances justification for
funding
• Support for the full PPBE lifecycle

17. Demonstration
Department of Energy OPPM
Implementation