September 2016 EVM 202—Lesson 4 Integrated Baseline Review (IBR) Process (Part 1: IBR Process and Baseline Development)

Lesson 4 Learning Objectives Terminal Learning Objective Examine the performance measurement baseline (PMB) validity Enabling Learning Objective Explain the PMB development process Apply the DoD Integrated Baseline Review (IBR) policy and process Given the Earned Value (EV) technique, analyze control account EVM variables to select EVM metrics Analyze a schedule using the Precedence Diagram Method (PDM) Analyze IBR documents to determine areas of concern within the five risk areas in preparation for control account manager (CAM) interviews Analyze the current schedule to determine status Explain the importance of PMB maintenance

EVM within the Contracting Process

DoDI 5000.02 EVM Policy Guidance Enclosure 1 Table 8 EVM Application Requirements

Baseline Development

PMB Budget Allocation

PMB Budget Allocation (Cont.) Management reserve (MR): Budget withheld by contractor program manager for unknowns/risk management NOT part of the PMB Undistributed budget (UB): Broadly defined activities not yet distributed to a control account (CA) or summary level planning package (SLPP) Is NOT time-phased Does not have a WBS number IS part of the PMB Is a short-term holding account; UB to be distributed into SLPPs or CA Summary level planning package (SLPP): Far-term contract activities not yet defined into CAs IS time-phased Can be distributed to reporting level WBS elements at a higher level than the CA, which distinguishes it from UB

Baseline Planning Approaches Detailed planning of all contract tasks is not usually possible at the contract’s start Detailed planning is done in “waves” or increments Once the nearest-term work is completed, the next segment of work is detail planned, and then the next, etc. Detailed planning concepts include: Rolling wave—Always detail plan a certain number of months into the future; constant planning mode Block planning—Plan a block of time or to the next major milestone; planning in increments, not in constant planning mode

PMB Development Steps Category Steps Scope Identify the scope of work Extend to control account (CA)/work package level Schedule Arrange the work packages in order Schedule work packages Classify the work and select an earned value (EV) technique Budget Budget the work packages Spread the budget over time Calculate cumulative budgeted cost for work scheduled (BCWScum)

The Control Account: A Key Management Control Point (Responsibility Assignment Matrix)

Scheduling Process Overview The Integrated Master Plan (IMP) is an event-based plan, which serves as the starting point for the Integrated Master Schedule (IMS) The IMS should reflect contract milestones and technical requirements The IMS and lower level schedules must provide vertical and horizontal traceability Integrated product team (IPT) members must be knowledgeable of commonly used schedule presentation techniques

Schedule Integration The IMS and lower level schedules must be traceable both vertically and horizontally. Summary Master Schedule Contract program schedule Shows horizontal integration Intermediate Schedule Major event or functional organization milestone schedule Shows vertical integration to summary master schedule and detailed level Detailed Schedule Control account and work package schedules

Integrated Master Schedule (IMS) *LRE = Latest revised estimate; the contractor’s estimate at completion (EAC)

Intermediate Schedule

Detailed Schedule

Determine When Tasks Happen

Classifying the Work Discrete or measurable Apportioned effort Specific end product or result Most objective category of work because the work is objective Apportioned effort Work dependent on other discrete work Level of effort (LOE) Has no specific product or hard to measure Does not have to be level loaded

Prefer or require most objective technique EV Techniques Discrete tasks 0/100 method 50/50 method Incremental milestone method Equivalent unit method % complete method Supervisor’s estimate method Apportioned effort Measured as a factor, e.g., 10% of discrete task Level of effort (LOE) Scheduled work earned based on passage of time Prefer or require most objective technique

EV Techniques Illustrated Method BAC Time Period BCWP Calculation 0/100 4 1 Period 50/50 8 2 Periods Incremental Milestone 20 2 or more periods Equivalent Units Complete 18 Varies % Complete 72 Apportioned Level of Effort (LOE) Tied to the discrete task (e.g., QA is 5% of pipe welding work package budget) BCWP = BCWS

Budget the Work Packages Labor Material Other Total Work Package 1 7 Work Package 2 11 Work Package 3 28 Work Package 4 9

Calculate Cumulative BCWS

Draw the PMB from the Cumulative BCWS

PMB Development Concepts Represents all work Is a participative process Is time-phased to contract and program milestones Is budgeted appropriately Reflects risk assessment Is realistic/achievable Is objective/measurable

PMB Summary Identifies the supplier’s plan to do the work Integrates technical, schedule, and cost Helps identify problems and allows early correction Defines means of determining status

EV Techniques Exercise Key: Comp = Complete LOE = Level of effort MS = Milestone

Basic Scheduling

Why Should You Care about Scheduling? Provides basis for project communication Identifies key milestones, activities, and interdependencies Provides baseline for performance measurement Provides current status and forecasts completion dates Allows management by exception Focus on critical path and slipping tasks Supports Better Buying Power (BBP) Basis to analyze resource leveling and facility/range availability Exploration of alternatives in cost/time trade-off studies Schedule status reported to management Through Central Repository (CR) and Defense Acquisition Executive Summary (DAES) to the Office of the Secretary of Defense (OSD) Through Selected Acquisition Report (SAR) to Congress Program schedule is a key consideration at milestone decisions Schedule slips may result in funding cuts and/or other major impacts To accomplish project objectives on time

Baseline Versus Current Schedule Current schedule—The plan reflecting actual accomplishments and projections for completing remaining objectives Baseline—The original approved plan for accomplishing project objectives

Network Scheduling Process Tasks Identify everything that needs to be done Ensure tasks trace to the WBS Duration Identify the duration of each task Determine the measure of duration (e.g., calendar days vs. business days) Order Identify what must happen before each task Establish criteria for starting a task Constraints Limitations to what may be done (e.g., facilities, resources)

Precedence Diagram Method (PDM) Task Relationships Finish-to-start Finish-to-finish Start-to-start Start-to-finish

Task Relationships—Finish-to-Start B cannot start until A has finished e.g., You cannot plant the flower until you have dug the hole.

Task Relationships—Finish-to-Finish B cannot finish until A has finished e.g., You cannot finish the analysis until the testing is finished.

Task Relationships—Start-to-Start B cannot start until A has started e.g., You cannot analyze test data until you have started testing.

Task Relationships—Start-to-Finish B cannot finish until A has started e.g., You cannot shut down the old computer system until the new one has come on line.

Task Relationships—Finish-to-Start with a Lag B cannot start until 1 day after A has finished e.g., You cannot remove the forms until 1 day after the concrete is poured. Lag should always be positive. A negative lag is called a lead and should not occur in a schedule.

Task Relationships—Start-to-Start with a Lag B cannot start until 1 day after A has started e.g., You cannot start painting until 1 day after the primer has set.

Task Relationships Exercise

Work Accomplished Out of Sequence? Possible scenarios: Task more complex than planned Relationship not required for subsequent tasks (redundant logic) Work completed, schedule not updated—incorrect status Purposefully decided to work out of sequence

Changing the Model Relationships Team changed relationships to reflect reality Legitimate planning techniques can be abused after a project starts—can add unnecessary risk if used incorrectly Things to look for: Sequential relationships changing to overlapping Task relationships changing from finish-to-start to start-to-start or finish-to-finish—Ask why?

Poor Scheduling Practices Poor scheduling practices can make it more difficult to use the schedule. The finish-to-start relationship between Task A and Task E is an example of redundant logic. The logic is already addressed through the finish-to-start relationship between Tasks A and B and the finish-to-start relationship between Tasks B and E.

Constraints A constraint is a field that imposes a restriction on the start date (start constraint) of a task or milestone or on the finish date (finish constraint) of a task and/or milestone Hard constraints anchor a schedule or task in time to a specific date regardless of predecessor logic Soft constraints anchor a task’s start or finish date but they respect predecessor logic and allow the schedule end date to move to the right (or slip) Use of constraints within a schedule should be minimized Constraints should never be used in the place of proper logic ties in the executable IMS For network calculation purposes, it is essential to limit and control the use of constraints

Schedule Analysis Forward pass—Determines earliest time (dates) for each activity (earliest finish time, EFT) EFT = EST + Duration - 1 Backward pass—Determines latest time (dates) for each activity (latest finish time, LFT) LST = LFT – Duration + 1 Float—Amount of time an activity can be delayed or expanded before it impacts the project finish time (Float = the lesser value of either LST - EST or LFT - EFT) Critical path—A sequence of discrete tasks/activities and milestones through the network that has the longest duration through the project with the least amount of float

Critical Path and Float Exercise Determine the critical path and note any poor scheduling practices.

Gantt Chart Schedule View Software is typically used to develop a contract or project schedule. A Gantt chart displays the activities and milestones in a project against time. This Gantt chart of the Critical Path and Float Exercise project was developed in MS Project.

Gantt Chart Critical Path To determine the critical path, start with the first task in the project and work through the network following these steps: Identify the first task on the critical path: Eliminate summary tasks (an aggregation of subordinate tasks, no predecessors or successors). Eliminate completed tasks (check the Actual Finish date). Note: An incomplete task with the earliest start date is usually the first task on the critical path. If two or more tasks have the same start date, select the one with the latest finish date. If a task is on the critical path, evaluate its successor tasks to determine next task on critical path: Apply steps 1a and 1b. Find the successor with the latest finish date and least amount of float (usually 0 days). Always check relationship logic between tasks. Repeat step 2 for each task on the critical path until you have mapped out the complete critical path to the end of the project.

Determine Critical Path in Scheduling Tool Gantt Chart Identify the first task on the critical path. ID 0 (Project Summary): This is a summary task, so it is not on the critical path. Task A: Is not a summary task and is not complete (i.e., Actual Finish = NA) Is the first incomplete task in this project, with the earliest start date and the least amount of float (0 days), so is the first task on the critical path Note that Task A is represented by a red bar on the Gantt chart, which is a typical Gantt chart format for critical tasks. Tasks on critical path so far: Task A

Determine Critical Path in Scheduling Tool Gantt Chart (Cont. 1) Evaluate the successors for tasks on the critical path. Using successor column: Task A has three successors: 2SS+3, 4, and 6. Successors are identified by their ID number. SS+3 refers to start-to-start plus a lag of 3 days. IDs 4 and 6 are finish-to-start relationships, the most common type. None of the successors are summary tasks or are complete. Evaluate each successor to see if it has the latest finish date and least amount of float. Task B has 3 days of float with a finish date of 1/4/07. It is not represented by a red bar on the chart. Task D has 0 days of float with a finish date of 1/15/07. It is represented by a red bar on the chart. Task F has 6 days of float. Its finish date is 1/21/07. It is not represented by a red bar on the chart. Is Task D (0 float) or Task F (latest finish date) on the critical path? Check the relationship logic to see what it tells you.

Determine Critical Path in Scheduling Tool Gantt Chart (Cont. 2) Evaluate the successors for tasks on the critical path (continued). Task A has a finish-to start-relationship with Task D and Task F. Task D also has a finish-to-start relationship with Task F. This is the redundant logic illustrated earlier in the PDM example. The redundant logic can be removed between Tasks A and F, leaving just Tasks D and B as Task A’s successors. Of the two remaining successor tasks, Task D has the latest finish date and least amount of float, so it is on the critical path. Task D is represented by a red bar on the chart. Tasks on critical path so far: Tasks A and D

Determine Critical Path in Scheduling Tool Gantt Chart (Cont. 3) Repeat step 2 for each task on the critical path. Task D, the next task on the critical path has two successors, Tasks F and G. Neither Task F nor G is a summary task or completed. Task G has the latest finish date and least amount of float (0 days), so it is next on the critical path. Task G is also represented by a red bar on the chart. Now the tasks on the critical path are A – D – G. Next, evaluate the Task G’s successors. Task G has only one successor, Task H, which has 0 float days and is the last task in the network. Task H is represented by a red bar on the chart. The critical path is A – D – G – H, just as was determined using the PDM schedule. Tasks on critical path: Tasks A – D – G – H

Resource Loading Analysis

Early Start

Late Start

Level Loaded