1. External Independent Review (EIR)
Princeton University
External Independent Review (EIR) of
NCSX
March 13-14, 2008
Cost and Schedule
Ron Strykowsky
PU External Independent Review March 13-14, 2008

2. PU External Independent Review March 13-14, 2008
Topics
Cost, Schedule and Contingency Development Process
Basis and Assumptions
Contingency
Cost Summary
Schedule Summary
Cost Profile
Staffing
EIR Summary Assessment
PU External Independent Review March 13-14, 2008

3. Process of Establishing a New Project Baseline
Job Managers Reviewed and Updated WAF’s (realistic not best case)
Additional scope per August Lehman review recommendations
Critically reviewed all job estimates to reflect current design maturity & experiences to date
Internal Engineering Department Review for Critical and Large Job Estimates
Updated overhead and labor rates
Updated resource Loaded Schedule
Focus on critical path optimization
Off critical path scope (maximize free float)
Fit Program funding targets
Expanded and quantified project risks
Contingency analysis process (probabilistic approach)
March PU Review
Follow-up actions complete data processing and analysis
Final Updates, Packaging, Documentation
Submit New Baseline Proposal to OFES March 26
Office of Science Review April 8-10
Submit Baseline Change Proposal to OECM April 21
External Independent Review May 20-22
The WAF’s are the basis of all estimates
The resource loaded schedule is the master schedule and cost estimate data base
PU External Independent Review March 13-14, 2008

4. Refined Estimating packages (table 1 of 6)
Table 1 - Work Approval Form
PU External Independent Review March 13-14, 2008

5. Refined Estimating packages (table 2 of 6)
Table 2 - Design
PU External Independent Review March 13-14, 2008

6. Refined Estimating packages (table 3 of 6)
Materials and Procurements
PU External Independent Review March 13-14, 2008

7. Refined Estimating packages (table 4 of 6)
Fabrication and Assembly
PU External Independent Review March 13-14, 2008

8. Refined Estimating packages (table 5 of 6)
Estimate Uncertainty and Risk
PU External Independent Review March 13-14, 2008

9. Refined Estimating packages (table 6 of 6)
Basis of estimate
PU External Independent Review March 13-14, 2008

10. Key Planning Basis and Assumptions
ETC forward from February 1st, 2008
Cost Incurred from April 1, 2003 (MIE project inception)
Every Job Reviewed, most re-estimated
GPP and Infrastructure not part of MIE project. (Progress coordinated and tracked by Erik Perry)
Program BA constraints
Institutional Overhead Rates (CAS Compliant)
Standard work week 8 hrs/day 5 days/week (Exceptions: Field period assy (sta3 FPA#3, station 5, and Final Machine assy make use of select 2 shift operations). No overtime or Saturday work planned.
Holidays
Contingency Allocation by fiscal year (commensurate with risk & cost uncertainty)
Task durations - more detail on critical path and near term
PU External Independent Review March 13-14, 2008

11. PU External Independent Review March 13-14, 2008
Scheduling - Process
Based on deliverables and/or tasks identified by the job managers
Input varied from resource loaded schedules to deliverables and resource estimate only
Established tasks, internal milestones (PDR’s, FDR’s, contract awards)
Task durations based on realistic resource loadings & crew sizes
Logically linked (2,170 tasks, 2900 individual resource loadings)
Non-critical path tasks scheduled within BA constraints with free float to critical path
Schedule iterated based on
Optimizing the critical path. (use of 2 shift operations, floor space for assembly tasks, metrology/back-office support, crane utilization studies)
Maximizing free float for non critical path tasks (ie procurements)
Front end loading system designs
Annual contingency set-asides
Resource leveling exercises to optimize techs and key engineers (did not impact critical path or cost)
PU External Independent Review March 13-14, 2008

12. Cost Basis - Resource types and Rates
Resource Types, labor and overhead rates
Non-Labor Resource
Labor Skills (hourly rates)
Overhead and escalation rates
PU External Independent Review March 13-14, 2008

13. PU External Independent Review March 13-14, 2008
Contingency - Process
Structured process - probabilistic risk analysis based (Monte Carlo Analysis)
Objective was to assess and analyze all areas of uncertainty and risk that might affect the cost and schedule estimates
Project Risk Registry key input (grown from 36 to 88 risks & monitored monthly)
Job Manager and Project Team input
Cost and schedule contingencies quantified
Contingency Allowance Range - 90% and 80% confidence levels analyzed
New process being followed
Chris Gruber to provide comprehensive analysis
PU External Independent Review March 13-14, 2008

14. PU External Independent Review March 13-14, 2008
Contingency – Results
Need to finalize our contingency proposal going forward
Use 90% confidence case for preliminary analysis being presented
PU External Independent Review March 13-14, 2008

15. Results –Cost Reconciliation
Highlight cost drivers
PU External Independent Review March 13-14, 2008

16. Cost growth by category
PU External Independent Review March 13-14, 2008

17. Results – Cost by RLM and Job
PU External Independent Review March 13-14, 2008

18. Results – Cost by RLM and Job (con’t)
PU External Independent Review March 13-14, 2008

19. Results – Cost by RLM and Job (con’t)
LOE budgeting applies mainly to management, supervision, & technical support functions-basis of estimates shown in WAF’s.
PU External Independent Review March 13-14, 2008

20. Results – Program BA Profile
Delayed research start
Schedule requires further iteration to improve contingency distribution
PU External Independent Review March 13-14, 2008

21. Results – Schedule (Summary)
Critical path through field period assembly, final machine assembly and start-up operations
Major procurement of components as well as ancillary system have ample schedule margin (months off critical path)
PU External Independent Review March 13-14, 2008

22. PU External Independent Review March 13-14, 2008
Results – Milestones
Milestones provide good metric of schedule progress
Distribution of milestones reasonable
Must still set DOE dates by adding schedule contingency
PU External Independent Review March 13-14, 2008

23. Results – Resource Loaded Schedule
Total float in working days (~1 month = 21 days)
Planning assumption: 1 shift per day or 2 shifts per day
Cost (= hours x rates)
Resource skill and hours (from WAF)
EXAMPLE
PU External Independent Review March 13-14, 2008

24. Staffing Requirements- Technicians
TFTR D&D manpower profile for comparison
Staffing requirements achievable and being satisfied
PU External Independent Review March 13-14, 2008

25. Staffing Requirements- Engrs & Designers
Future needs achievable with new hires to provide depth & backup
PU External Independent Review March 13-14, 2008

26. Staffing Requirements- ORNL & Metrology
PU External Independent Review March 13-14, 2008

27. EIR Summary Assessments
1. Resource loaded Schedule
Organized by WBS (refer to WBS and WBS Dictionary)
Resource estimate loading based on detail WAF packages signed by Job managers. (see detailed WAF packages)
Estimates based on prior experience, vendor quotes, fabrication estimates, design calculations. Basis of estimates include in WAF’s. (requires analysis and verification of resource loading)
Task durations based on realistic manpower loadings and crew sizes. Balance of task durations based on reasonable loadings Schedule detail commensurate with schedule criticality (e.g. wbs 18 job minimum task duration 1 day).
Proposed baseline BCWS and contingency profile consistent with anticipated funding levels.
Shows estimate detail and priced cost estimate (see resource loaded schedule)
PU External Independent Review March 13-14, 2008

28. EIR Summary Assessments (continued)
2. Key Project Cost and Schedule Assumptions
Standard 8 hour/day 5 day/week work assumed except where 2 shift operations called out in resource loaded schedule. (see slide 10)
Institutional overhead and labor rates utilized (see slide 11)
Contingency quantified based on estimate uncertainty and risk using Monte Carlo simulation plus a subjective increment based on project management experience. (see slides 12 & 13 and detailed contingency analysis)
Contingency distributed annually consistent with needs. (NO -WORK IN PROGRESS).
PU External Independent Review March 13-14, 2008

29. EIR Summary Assessments (continued)
3. Critical Path
See critical path plot on wall
See detail Primavera predecessor & successor report for logic linkages
4. Funding Profile
Project proposed baseline consistent with preliminary guidance (see slide 17)
5. Work Breakdown Structure
Resource loaded schedule is organized by WBS (see WBS and WBS Dictionary)
PU External Independent Review March 13-14, 2008

30. PU External Independent Review March 13-14, 2008
SUMMARY
Project has followed a disciplined path for updating its cost and schedule estimates highlighted by;
Formal & consistent basis of estimate
Independent reviews by PPPL engineering and PU
Focus on obtaining realistic estimates from job managers
Project has followed a methodical process for quantifying cost as well as schedule contingency.
Project has expanded its risk registry and incorporated into monthly status review meetings
Project has proposed a sound baseline cost estimate backed-up by a resource loaded schedule and detailed estimate basis.
Completion of data analysis and verification of resource loaded schedule required to ensure completeness
PU External Independent Review March 13-14, 2008

31. DETAILED STAFFING BACKUP
Designers
PU External Independent Review March 13-14, 2008

32. DETAILED STAFFING BACKUP
Analysts/Mechanical Engineers (EA)
PU External Independent Review March 13-14, 2008

33. DETAILED STAFFING BACKUP
Electrical and FO&M Engineers
PU External Independent Review March 13-14, 2008

34. DETAILED STAFFING BACKUP
ORNL Engineers/Designers
PU External Independent Review March 13-14, 2008