2. Agenda
How does Deep Space Navigation work?
What is so difficult about cost and schedule
monitor and control?
Applying navigation techniques to cost and
schedule analysis
5. Choosing a Target
Probabilistic Analysis is
done for a planet body
surface (contour plots)
Target A: Probability of
a safe landing is 40%
Target B: Probability of
a safe landing is 60%
Target C: Probability of
a safe landing is 85%
7. A Bias
Observations may be offset by contributing
factors
Station locations, measurement techniques
and environment can all contribute
A bias accounts for the constant error
introduced
8. Stochastic Parameters
Some aspects change over time
specific events
specific conditions
A parameter can respond to changes over
time and environment
10. Project Budgets
Budgets are determined before the
complexity of the work is discovered
Project cost estimates are created to meet a
single, inflexible value
In negotiations, lower budgets are accepted
without changes in scope
11. Project Progress
Schedule milestones are inflexible
Changing implementation approaches change
task definitions
Estimates carry a lot of uncertainty
12. What can go wrong
Take an example:
A project has to complete 100 tasks
Estimates are off by 20%
Resource allocations are off by 15%
Financial Reporting is off by 5%
Progress measures are off by 30%
Impact: Total Errors could be over 50%!
14. Understanding
Uncertainty
Distributions not Delta Functions
Likelihood
One value, Most Likely
100%
many assumptions
Best Case
Worst Case
Cost
$12M $10M $12M $14M
(Three Point Estimation)
15. How Does the
Negotiation go?
Sponsor Project Manager
What is your cost $90 Million
estimate?
Will it fit under a $80 Sure, we crashed it
million dollar cap? down to $75 Million
Oh yeah? Can you do the Yeah, we scoured it
job for $10 million less? down to $65 Million
16. How Should the
Negotiation go?
Sponsor Project Manager
What is your cost At $90 Million, we are 80%
estimate? confident of cost success
Will it fit under a $80 At $75 Million, we have a
million dollar cap? 65% confidence
Oh yeah? Can you do the Sure, but at $65 Million we
job for $10 million less? are only 50% confident
17. Estimator Bias
Estimates are like Observations
People are always wrong, but they are
consistently in how they are wrong
Multiple Observations lead to greater
accuracy
19. Systemic Bias - Resources
Resource Availability versus Commitments
Apply the Bias to future allocations
20. Systemic Bias - Financial
Contractor Performance (bids versus actuals
by vendor)
Financial Reporting Systems
Example: Costs were planned for a task
using the average rate for a senior
engineer pay grade
The complexity of the task called for the
most skilled senior engineers near the top
of the pay grade biasing costs upwards
21. Performance Bias
Task performance reporting has a bias that
changes over time
90% complete disease
Reported 0% 50% 90% 100%
Actual 0% 25% 50% 75% 100%
22. Performance Bias
Weighted Milestone Approach
Acts like a stochastic parameter
25% at start 75% at the first
of the task report of completion
50% when the task 100% at verification
is well understood of completion
23. Earned Value Analysis
Garbage In = Garbage Out
Use biased estimates for BCWS
Apply biased performance measures for BCWP
Understand financial biases for ACWP
24. Summary
Use Distributions
Understand and apply biases in all areas of
the project
Immediate, accurate ETC and EAC
calculations
Fast response to funding changes
Higher probability of completing on budget
