National Aeronautics and Space AdministrationNational Aeronautics and Space Administration                 The Ares Projec...
Objective•   Understand the Planning, Programming,    Budget and Execution (PPBE) process       and how it is integrated i...
OutlineBudget vs. Funding.The PPBE Process.The PMB process.PPBE and PMB Integration.Implementation Challenges.NOA and the ...
Funding & The Federal Budget ProcessFunding is the end result of the Federal BudgetProcess.   NASA submits proposed budget...
NASA FundingNASA Headquarters receives appropriated funds fromOMB.NASA Headquarters distributes the appropriatedfunds to e...
Budget vs. Funding SummaryFunding and Budget (Performance MeasurementBaseline – PMB) are separate but interrelated.Changes...
Budget vs. Funding                                         FY 09                                 Funding (Projected)      ...
The PPBE ProcessA planning and budgeting process used by the Agency toconvert strategies and priorities into programs andb...
High-level Agency PPBE Process  Planning       Programming         Budgeting          Execution                           ...
The PPBE Process (continued)Purpose  The conversion of information from the Strategic Plan, the  Mission Directorate and I...
The Performance Measurement Baseline (PMB) The PMB is a time-phased budget against which EVM performance is measured. The ...
PPBE and PMB IntegrationThe PPBE provides Agency-level strategic guidance to the MissionDirectorates. The Mission Director...
Challenges to Developing the Revised PMBDetailed planning by the Project Offices to meet strategic goalsfrom the PPBE exce...
New Obligation Authority (NOA) and the             Revised PMBWhen the PPBE changes the funding (NOA profile) but a revise...
NOA Options and AssumptionsSeven Data points used in EVM and NOA (Plan vs Actuals) analysis.1.   BCWS – Budgeted Cost Of W...
Conclusion and Best PracticesRevised PPBE guidance will be issued yearly. Projectsmust accept this fact and have dynamic t...
Question and Discussion                          17
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  1. 1. National Aeronautics and Space AdministrationNational Aeronautics and Space Administration The Ares Project Office PPBE and EVM Integrationwww.nasa.govwww.nasa.gov
  2. 2. Objective• Understand the Planning, Programming, Budget and Execution (PPBE) process and how it is integrated into the Performance Measurement Baseline (PMB) 2
  3. 3. OutlineBudget vs. Funding.The PPBE Process.The PMB process.PPBE and PMB Integration.Implementation Challenges.NOA and the PMB.Conclusion and Discussion. 3
  4. 4. Funding & The Federal Budget ProcessFunding is the end result of the Federal BudgetProcess. NASA submits proposed budget by FY to the Office of Management and Budget (OMB). OMB reviews the budget submittal, makes recommendations and forwards to the President. The President approves the proposed budget and forwards it to Congress. Congress approves and issues Authorization Acts and Appropriation Acts. OMB disburses appropriated funds (this is where the word “funding” originates) to the Agency.Each Agency authorizes and distributes funding to Programs,Projects, and Organizations. 4
  5. 5. NASA FundingNASA Headquarters receives appropriated funds fromOMB.NASA Headquarters distributes the appropriatedfunds to each Mission Directorate (MD).MD’s authorize funds disbursement to individualPrograms and Projects.MD’s retains reserves that are disbursed during theFY.The Chief Financial Officer (CFO), The ProgramOffice and the Project Office are responsible for fundscontrol. 5
  6. 6. Budget vs. Funding SummaryFunding and Budget (Performance MeasurementBaseline – PMB) are separate but interrelated.Changes to the Budget can impact the Funding andvice versa.Funding is authorized, monitored and controlled by FY.Budget is developed, monitored and controlled for thelife-cycle of a project.The project life-cycle budget can be used to forecastout-year Funding profiles. Out-year funding profiles donot necessarily constitute a change to the PMB. 6
  7. 7. Budget vs. Funding FY 09 Funding (Projected) FY 08 Funding Funding FY 07$ Funding Budget FY 06 Points Where Funding Budget Exceeds FundingStart Completion Time NowDate Date 7
  8. 8. The PPBE ProcessA planning and budgeting process used by the Agency toconvert strategies and priorities into programs andbudgets.A focus on “Programming”, high-level, multi-year,structured analyses of alternative uses of capabilities andcapacitiesKey Elements Alternative uses of capabilities and capacities, including gap and excess analyses Multi-year resource implications Explicit, balanced, and feasible alternative methods of accomplishment Trade-off options: needs and costs considered simultaneously Risk Analysis Prioritization 8
  9. 9. High-level Agency PPBE Process Planning Programming Budgeting Execution Programmatic and Operating PlanStrategic Plan Resources Institutional and Guidance Guidance ReprogrammingImplementation Plan OMB Budget Program Analyses Priorities and Alignment Development Monthly Phasing PlansAssessments Institutional Performance Infrastructure President’s Analyses of Measures Analyses Performance/ Budget Expenditures (IBPD) Program Review/ Issues Book Strategic Program Decision Close-out & Program Memorandum Appropriation Report (PAR) Guidance (PDM) 9
  10. 10. The PPBE Process (continued)Purpose The conversion of information from the Strategic Plan, the Mission Directorate and Institutional Implementation Plans, priorities, studies and assessments, and performance measures into strategic guidance for Mission Directorates, Mission Support Offices, the Program Offices and the Projects.Inputs The inputs for this step are the Strategic Plan or updates, the Mission Directorate and Institutional Implementation Plans, the most recent OMB pass-back, and various studies, reports, and assessments – e.g. program schedules, staffing levels, critical facilities, etc.Outputs Guidance is issued to the Mission Directorates, the Program and Project Offices to accomplish the specific strategic objectives. Examples include Initial Operational Capability (IOC) and Full Operational Capability (FOC) by specific dates. Additionally, specific budget guidance by FY is given. 10
  11. 11. The Performance Measurement Baseline (PMB) The PMB is a time-phased budget against which EVM performance is measured. The PMB includes both prime contractor and NASA “in-house” efforts. The PMB is the summation of Work Packages (WP) and Planning Packages (PP) and includes Undistributed Budget (UB) held at the Project level. The PMB is developed early in the project life-cycle (typically 6 months post ATP for prime contractors) based on anticipated work flow, technical requirements and major schedule milestones (CDR, PDR, Orion 1 flight, etc.). The PMB is authorized by the Program Office to the Project Office via a Project Authorization Document (PAD). The PMB is maintained via formal change control. If the PPBE changes constitute a revised PAD the PMB must be revised. 11
  12. 12. PPBE and PMB IntegrationThe PPBE provides Agency-level strategic guidance to the MissionDirectorates. The Mission Directorates flow this guidance down tothe Program Office, and then to each Project Office. This guidanceincludes specific funding (marks) and schedule direction. Specific schedule milestones, Ares I-Y, Orion I, IOC, FOC dates. Specific funding by FY to develop the PMB. Specific assumptions for future FY planning.Each Project Office uses this guidance to perform detailedplanning. The Project Office rolls-up the detailed plan (by WBS,Element, system and/or sub-system) and ensures compliance withthe PPBE guidance.Once Project Office planning is complete, formal reviews areconducted between the Program Office and the Project Offices.When agreement is reached, the Program Office issues revisedPADs to each Project Office. 12
  13. 13. Challenges to Developing the Revised PMBDetailed planning by the Project Offices to meet strategic goalsfrom the PPBE exceed the funding profile by FY.Revised direction (contractual via the CO) to prime contractorsand their formal submittal of a new PMB can take months tocomplete. EVM reporting by the prime contractors become antiquated during this long re-planning period.Known risk items (sometimes referred to as cost threats) can notbe included in the PMB due to funding limitations. Work is performed to mitigate risk without approved budget or schedule. Poor performance on “in-scope” work can be masked by work performed that is “out-of-scope”.Direction has been given to the Project Office to include specificscope without budget, schedule or written direction. 13
  14. 14. New Obligation Authority (NOA) and the Revised PMBWhen the PPBE changes the funding (NOA profile) but a revisedPAD is not issued. The Project using Inception-To-Date (ITD) actual cost, may create a new Estimate to Complete (ETC) for remaining effort to match NOA Profile. Cost and/or schedule risk can be entered or tracked as one of the reconciliations from EAC to new NOA profile. The Project can submit to the Program Office a Budget Change Request (BCR) requesting new budget using EAC as backup for request. No changes to PMB will be implemented until the PAD revision is issued.Changes to the PMB as a result of the PPBE can include; Depending on what changes. Project may replan specific efforts (close open WPs and open new WPs and covert PPs to WPs) Project Office may replan the total Project Rebaseline the entire project which implies setting cum BCWS/BCWP to ACWP 14
  15. 15. NOA Options and AssumptionsSeven Data points used in EVM and NOA (Plan vs Actuals) analysis.1. BCWS – Budgeted Cost Of Work Scheduled (PMB Budget).2. BCWP – Budgeted Cost Of Work Performed (Schedule Status).3. ACWP – Actual Cost Of Work Performed.4. BAC – Budget At Complete (Sum of PMB).5. EAC – Estimate At Complete (Latest forecast of total expected cost).6. NOA – Planned time phased funding profiles.7. Actuals – Total spent against NOA.BCWS will equal NOA upon initial implementation of PPBE guidance.ACWP will equal or be reconcilable to Actuals.Future PPBE exercises may modify NOA’s.EAC (1 of the 3 point EAC of Best, Worst, or Most Likely) will be equal toor reconcilable to future PPBE exercises. 15
  16. 16. Conclusion and Best PracticesRevised PPBE guidance will be issued yearly. Projectsmust accept this fact and have dynamic tools andprocesses to respond.Disciplined Configuration Management (CM) processesare essential to documenting and tracking changes thatresult from PPBE guidance.Programs and Projects must resist the urge torebaseline each year.The Program Office should not provide verbal directionbut should provide timely written direction. 16
  17. 17. Question and Discussion 17

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