EVMS Compliance Review Series #3 – Using Storyboards to Depict the Entire EVMS

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UPDATE#1 NOVEMBER 10, 2017
UPDATE#2 DECEMBER 15, 2020

DCMA Compliance Review

This is the third topic in a series discussing the DCMA Compliance Review (CR) process. It is the second update to the original series #3 Blog that was based on the instruction book from the DCMA Website that identified the “DCMA 16 Step (and then their 8-Step) EVMS Compliance Review Process.” This change was documented in the DCMA “Earned Value Management System Compliance Reviews Instruction (DCMA-INST 208).” This Instruction has been rescinded and replaced with a set of DCMA Business Practices (BP). These Business Practices split out topics the old DCMA Instruction 208 covered in one document. Whether you are a contractor new to the EVM contracting environment or a seasoned veteran, if the Earned Value Management System (EVMS) compliance and acceptance authority is the Defense Contract Management Agency (DCMA), these new Business Practices apply to you.

EVMS Storyboards

The focus of this discussion is on using EVMS Storyboards to assist with the interviews and data traces that are part of any internal EVMS review, as well as during the conduct of any of Compliance Review, Surveillance Review, or Review for Cause (RFC). Storyboards can also be useful in supporting on-going surveillance activities. Even more important is their usefulness for training contractor and government personnel in how the EVM System operates.

Depict the Management System

An EVMS Storyboard depicts the entire management system as stratified flow diagrams with artifacts illustrating the inputs and outputs that demonstrate the system in operation. It is meant to clearly illustrate:

  • How the entire system functions (the flow),
  • Who is responsible for doing what (decision points and actions),
  • Products (forms, reports, outputs, and other artifacts), and
  • How all the process groups are interrelated to create a fully integrated EVMS.

Single Thread

The storyboard should also illustrate a single thread trace to demonstrate data integrity from beginning to end using actual project artifacts. Storyboards are an essential tool for training all levels of users and is invaluable for demonstrating to a customer or a review team how a contractor’s EVM System functions.

Formats

Storyboards can take many forms. The entire process can be displayed on panels or poster boards on a conference room wall. It can be contained in the EVM System Description document as an overall flow, or as segmented flows in the system description sections corresponding to the process flow. It can also be electronic or online flow diagrams with links to live artifacts.

The DCMA EVMS Center has made it clear that EVMS Storyboards are an important part of the compliance review process. During a compliance review, the contractor would be expected to use these stratified flow documents to walk through the various system processes. This includes the project manager, integrated product team (IPT) leads, control account managers (CAMs), and other functional leads. The various users of the EVMS should be able to use the storyboard flow documents to help tell their “story” and demonstrate data traceability using live project artifacts.

Compliance Review

When preparing for any compliance review, be sure to step through your EVMS Storyboard to verify:

  • It is complete and clearly illustrates how all the process groups are interrelated,
  • Roles and responsibilities are unambiguous,
  • Entrance and exit points are clearly marked,
  • Artifacts are up to date,
  • It accurately reflects how project personnel are using the EVMS to manage their work, and
  • All the data represented on the storyboard traces properly.

What if I don’t have an EVMS Storyboard?

If you don’t have an EVMS Storyboard in place, consider starting with the flow diagrams in your EVM System Description and building them out into a storyboard. An EVMS Storyboard is an essential tool to successfully navigate the compliance review process. It can help to prevent DCMA Discrepancy Reports (DRs) or Corrective Action Requests (CARs) being written because the DCMA review team didn’t know how to locate certain documents, or they didn’t understand how a process worked.

Humphreys & Associates can help you develop a new EVMS Storyboard or enhance your existing EVMS Storyboard, an important and cost saving tool. To contact us, (click here) or call (714) 685-1730.

 

EVMS Compliance Review Series

 

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EVMS Compliance Review (CR) Series #2 – Preparing for the EVMS CR

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Update #1 November 10, 2017
Update #2 December 15, 2020

http://www.dcma.mil/This is the second topic in a series discussing the DCMA Compliance Review (CR) process. It is the second update to the original series #2 Blog that was based on the instruction book from the DCMA Website that identified the “DCMA 16 Step (and then their 8-Step) EVMS Compliance Review Process.” This change was documented in the DCMA “Earned Value Management System Compliance Reviews Instruction (DCMA-INST 208).” This Instruction has been rescinded and replaced with a set of DCMA Business Practices. These Business Practices split out topics the old DCMA Instruction 208 covered in one document. Whether you are a contractor new to the EVM contracting environment or a seasoned veteran, if the Earned Value Management System (EVMS) compliance and acceptance authority is the Defense Contract Management Agency (DCMA), these new Business Practices apply to you. The overall EVMS review processes are covered in the following eight Business Practices (BP):

  • BP0 – Earned Value Management Systems (Overarching guidance, overview of the Business Practices)
  • BP1 – Pre-Award EVM System Plan Review
  • BP2 – System Description Review
  • BP3 – Program Support
  • BP4 – System Surveillance
  • BP5 – Review for Cause
  • BP6 – Compliance Review Execution
  • BP7 – Compliance Metric Configuration Control (DCMA internal document)

 

BP6 defines a uniform process for the DCMA EVMS Center personnel to conduct the planning, execution, and reporting of an initial contractor EVMS Compliance Review (CR), following 23 Steps in 5 major phases or Process Steps (see Figure 1 below from BP6):

Figure 1 - EVMS Compliance Review (CR), following 23 Steps in 5 major phases or Process Steps
Figure 1

The focus of this discussion is on the second phase shown in Figure 1, “Execute Pre-Event Activities,” Steps 6 (Request Other Data Sources) and 7 (Initiate Data Analysis).  The old CR Processes included the contractor’s Self-Assessment (SA) as a more formalized part of their Compliance Review Steps, but the Business Practices no longer include the SA. Any self-assessment conducted by the contractor is included in the Box 6 in Figure 1 “Request Other Data Sources,” but only as a possible source of Corrective Action Requests (CARs) that could become part of the CR process. Data Analysis is still a major part of the new CR Process (Box 7 in Figure 1) and plays a significant role in DCMA’s “data-driven” reviews. Even though the DCMA no longer formalizes the SA they still encourage contractors to conduct some type of evaluations of their own systems prior to any customer review taking place.

Since the contractor should be using the same data the DCMA will be using for their Data Analysis (DA), it is essential to provide quality data in response to the DCMA data call and during any internal evaluations the contractor conducts. Remember, the DCMA can halt the CR process if the data are found to be lacking. One item to note regarding a contractor’s internal evaluation: if the contractor self-identifies a non-compliant issue and takes timely and appropriate steps to correct it, DCMA does not intend to issue a Corrective Action Request (CAR) for that issue. They will however, continue to monitor the progress in correcting the noncompliance through the Corrective Action Plan (CAP) reviews.

The DCMA Data Analysis step is an assessment of the contractor’s readiness to undergo the remainder of the CR Process, and will influence the timing of the rest of the review process.  A contractor’s internal EVMS assessment of the same data that will be delivered to the DCMA should give the contractor an accurate assessment of their readiness for the review.  Unfortunately, it is sometimes difficult for personnel in a company to objectively criticize their own processes and personnel implementing those processes.  This article presents an effective and important pre-Compliance Review internal assessment for contractors – the Mock EVMS Review.

With the Self-Assessment (SA) no longer being a formal part of the CR process, the Mock EVMS Review is an excellent way for the contractor to get an independent assessment of their readiness to undergo the Compliance Review. Since the Mock Review must be a thorough assessment of their system and implementation, the amount of effort required to conduct the Mock Review is significant.

The Mock Review should simulate as closely as possible the Compliance Review the DCMA will conduct. The Mock Review is typically done by an outside third party reviewer that will take an objective look at the contractor’s system and implementation. This can be a parent organization or a sister organization that has experience conducting such reviews. This type of experience within a company is not common, however, so companies often come to third party organizations, like Humphreys & Associates, Inc., who have done these sorts of assessments for many years.

The Mock EVMS Review should simulate everything DCMA will do, including:

§  A comprehensive data call (using the DCMA’s current data call list);

§  A rigorous Data Analysis of those data call items;

§  Thorough evaluation of the EVM System Description and implementing procedures;

§  Use of Discrepancy Report (DR) and Corrective Action Request (CAR) forms with instructions;

§  Use of various checklists and EIA-748 guideline evaluation forms;

§  Use of role specific interview forms;

§  Conducting simulated interviews across various functional levels;

§  Conducting data traces by guideline; and

§  Use of briefing and report templates to convey the results.

The Mock EVMS Review must include a thorough scrub of the schedule and cost data. All data must trace through all project artifacts. The best way to prepare for this, as well as well as continually ensure data integrity, is to incorporate regular data quality checks into your normal project control activities. A few basic checks you should always perform include:

§  Verifying the Integrated Program Management Data and Analysis Report (IPMDAR) cost and schedule electronic deliverable datasets or the data included in every contractual performance report format such as the Contract Performance Report (CPR) Formats 1 to 5 or Integrated Program Management Report (IPMR) Formats 1 through 7 before delivery to the customer. Trace and reconcile all summary values to verify the source detailed data matches what is included in a dataset or report format. Check for math errors, missing elements, or other invalid data, such as: the BCWScum (budget) or BCWPcum (earned value) is greater than the budget at completion (BAC) or the ACWPcum (actual cost) is greater than the estimate at completion (EAC).

§  Verifying all project logs (contract budget base, management reserve, undistributed budget, etc.) and confirming summary numbers match the reporting deliverable information (CPR/IPMR/IPMDAR).

§  Confirming the schedule and cost data tell the same story and are reconciled to other project artifacts, such as the Work Breakdown Structure (WBS) Dictionary and work authorization documents.

§  Confirming the change logs are up to date ensuring approved changes are incorporated in the schedule and cost data in a timely manner. All changes must be fully traceable.

§  Conducting schedule data quality checks to verify logic, status updates, accurate coding, calendar assignments, reasonable descriptions, and the like.

§  Verifying subcontractor schedule and cost data for accuracy and timeliness.

It takes effort to produce and maintain quality schedule and cost data for the life of a project. It requires management focus and attention to detail. With the wealth of toolsets available and the amount of data available electronically, implementing steps to make it easier to maintain data integrity can make a difference.

The processes that companies implement have the potential to hinder the process to produce and maintain quality data. Always be prepared to update desktop procedures or other process steps to create a single data source that is fully traceable. Where possible, eliminate duplicate steps, duplicate data entry, or manual rekeying that has the potential to compromise data integrity or the ability to conduct data traces.

Whether you have a customer or contractor review coming up or not, data integrity is a fundamental requirement for an effective EVMS.

Call Humphreys & Associates to assist with the contractor Mock EVMS Review process including reviewing the system documentation, performing data quality checks, and helping prepare the data packages for delivery to DCMA. We can be reached at (714) 685-1730 or email us.

EVMS Compliance Review Series

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EVMS Compliance Review Series #1 – Prep for the DCMA Compliance Review Process

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Update #1 November 7, 2017
Update #2 December 15, 2020

This is the first topic in a series discussing the DCMA Compliance Review (CR) process. It is the second update to the original series #1 Blog that was based on the instruction book from the DCMA Website that identified the “DCMA 16 Step (and then their 8-Step [UPDATE #2]) EVMS Compliance Review Process.” This change was documented in the DCMA “Earned Value Management System Compliance Reviews Instruction (DCMA-INST 208).” This Instruction has been rescinded and replaced with a set of DCMA Business Practices (BP). These Business Practices split out topics that the old DCMA Instruction 208 covered in one document. Whether you are a contractor new to the EVM contracting environment or a seasoned veteran, if the Earned Value Management System (EVMS) compliance and acceptance authority is the Defense Contract Management Agency (DCMA), these new Business Practices apply to you.

The overall EVMS review processes are covered in the following eight Business Practices (BP):

  • BP0 – Earned Value Management Systems (Overarching guidance, overview of the Business Practices)
  • BP1 – Pre-Award EVM System Plan Review
  • BP2 – System Description Review
  • BP3 – Program Support
  • BP4 – System Surveillance
  • BP5 – Review for Cause
  • BP6 – Compliance Review Execution
  • BP7 – Compliance Metric Configuration Control (DCMA internal document)

As noted in BP6, “[a] CR is a comprehensive assessment of a contractor’s system, comprised of a System Description (SD), command media, processes, related tools, and the contractor’s ability to implement the EVM system on contracts with an EVMS requirement. The intent is to demonstrate and document compliance to the 32 Guidelines in the EIA-748 EVMS standard. There are three steps for evaluating compliance:

  • Assess whether the contractor’s EVM SD adequately documents how its system meets the intent of the 32 Guidelines;
  • Evaluate the contractor’s ability to demonstrate the EVMS implementation as described in the SD and supplemental procedures;
  • Verify whether the EVMS is providing timely, accurate, reliable and auditable data.”

BP6 defines a uniform process for the DCMA EVMS Center personnel to conduct the planning, execution, and reporting of an initial contractor EVMS Compliance Review (CR), following 23 Steps in 5 major phases or Process Steps (see Figure 1 below from BP6):

Figure 1 - EVMS Compliance Review (CR), following 23 Steps in 5 major phases or Process Steps

This figure shows that the BP6 approach is essentially a combination and consolidation of the 16 Steps and the 8 Step processes in the two prior CR instructions. The tables below show those compliance review process approaches of the old 16 Steps and the 8 Steps:

Table 1. EVMS 16 Step CR Process
Earned Value Management System Review Process
Table 2. EVMS 8 Step CR Process
Process StepDescription
1Notification and Data Call
2Planning and the Data Analysis (DA)
3Opening Meeting
4Fieldwork
5Communication
6Report Writing
8Close-Out

The BP6 process adds clarity on the Review Planning process prior to the Notification steps shown in both the old sets of steps, and then the rest of the BP6 process is consistent with both of the older processes. This is much like the joke about the man who ordered a medium pizza for himself, and the pizza proprietor asked if he would like that cut into 8 pieces or 16 pieces or 20 pieces. The man replied “Hmmm. Eight pieces are probably not enough — I am really hungry, you had better do 20 slices!”

This Business Processes also remains consistent with the change the “8 Step process” made to the “16 Step Process” in that DCMA has removed all lower-level activities that previously involved DCAA and remain DCMA responsibilities. In addition, as part of the data analysis, the current Business Practices incorporate the use of the DCMA EVMS Compliance Metrics (DECM) to isolate any data issues for discussion during the review.

A frequent and common question that H&A consultants are asked is how long it takes to complete the DCMA Compliance Review process. In all the years H&A has been in business, it has varied based on:

§  The current contractual environment,

§  DCMA process requirements, and

§  The resources DCMA has available to do compliance reviews.

In the past, a contractor with an aggressive EVMS implementation plan could complete the process in coordination with the DCMA in about 18 months.

It is a different story today. DCMA is short on the resources they need to do compliance reviews and they have been updating their processes and requirements. The result: it can take up to three years to complete the process. This can have serious implications in those instances where a contractor is contractually required to have a DCMA EVMS Acceptance in place for a project. In some instances, the contract may be near completion or already completed by the time DCMA sends off a notification letter to the contractor.

Unfortunately, the modifications to the CR process have simply cut that “pizza” into 16 slices, then 8 slices, and now 23 slices, meaning that virtually the same process is required, no matter how you cut it. The problem was not the number of steps, but the length of the process (the pizza itself!).  The DCMA now intends to do data intensive reviews and to conduct parts of the EVMS review remotely, which could save time and money, hopefully without jeopardizing the integrity of the review process.

What do you do if you find yourself in this situation? One suggestion is to have a discussion with the Director of the EVMS Center to request a waiver from the system acceptance contractual requirement because the compliance review process cannot be completed before the contract completion date.

One critical implication is that each of these process approaches assumes successful accomplishment of each step. Any failure along the way will extend the time it will take a contractor to attain acceptance of their system and implementation. A contractor must be fully prepared to prevent a repeat of any of the steps in the process. It is essential to do things right the first time to prevent further delays. This is a discussion for the next topic in this series – preparing for the EVMS Compliance Review process by conducting internal mock reviews. Since “self-assessments” are no longer formalized in the CR Process, DCMA expects contractors to do internal surveillance and self-identify (and address) EVMS issues to possibly avoid formal Corrective Action Requests (CARs) from DCMA.

Contact Humphreys & Associates for questions about preparing for a DCMA compliance review. Go to our Contact page or email us.

EVMS Compliance Review Series

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New Integrated Program Management Report (IPMR) DID

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This coming change, likely to take effect in May 2012, applies to government contractual requirements (CDRLs) on contracts that require Earned Value Management (EVM) by most federal agencies. This is of particular importance to program and project managers, corporate EVM focal points and other staff that maintain a corporate EVM System Description or training materials. In some cases it applies to IT resources responsible for maintaining the schedule and cost toolsets used on projects.

A new Data Item Description (DID) for contract performance reporting and integrated master schedules was recently circulated for public comment.  The new DID, Integrated Program Management Report (IPMR), DI-MGMT-81466B, will replace the current Contract Performance Report (CPR) DID, DI-MGMT-81466A, and the Integrated Master Schedule (IMS) DID, DI-MGMT-81650.

A copy of the draft IPMR DID can be found on the PARCA (Performance Assessments and Root Cause Analyses) website. PARCA is part of the Office of the Assistant Secretary of Defense for Acquisition.  The Earned Value Management Division of PARCA is the DOD focal point for all policy, guidance, and competency relating to EVM.

In summary:

  • The IPMR DID combines the CPR and IMS DIDs into one
  • CPR Formats 1 to 5 become the IPMR Formats 1 to 5
  • The IMS becomes IPMR Format 6
  • There are a few content changes mostly confined to Format 3, which opens up the Baseline Changes (Block 6.b.) row columns
  • It adds a new Format 7, time phased historical data (an annual submission)
  • The electronic data delivery format is changing from the ANSI X12 standard to the UN/CEFACT XML standard

The initial comment period for the IPMR DID closed on January 31, 2012, followed with additional discussions with industry through the NDIA Program Management Systems Committee (PMSC). The likely publication date is early May 2012 but this is dependent on the final formal coordination process within OSD. The new DID will begin being applied on new contracts once the DID is approved.

The new DID does impact current EVM Systems as it will be necessary to reference the old and new terms and forms.  As a result, it may be necessary to update:

  • Training materials
  • System Description and Storyboard text, example formats and/or artifacts
  • Desktop instructions for producing specified formats
  • Software toolset outputs and electronic deliverables
  • Self-surveillance and subcontractor surveillance materials

Most cost and schedule software vendors are aware of the pending changes.  You may want to check with your toolset vendor of choice to see when they plan to have software updates available to support the new DID requirements.

Humphreys & Associates is available to provide resources, consulting and information on this topic. Click here to contact us.

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Earned Value Management System Success – 7 Steps

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An Earned Value Management System is a common contractual requirement on US federal government agency projects and on some foreign government agency projects. Earned Value Management is an effective tool to provide more visibility into project performance for government customers and for internal management.

As with any new concept or tool, success is dependent on how the system is implemented. Upfront planning can mean the difference between success and failure. Based on more than three decades of experience helping hundreds of companies implement an Earned Value Management System, Humphreys & Associates is well versed in what it requires to create a compliant, effective Earned Value Management System (EVMS).

The seven steps below can help to expedite and manage the implementation of a compliant EVM System. Successful implementation can greatly enhance productivity and the bottom line.

Earned Value Management System Success – 7 Steps

Step 1 – Management Team Commitment

Commitment and support from the management team is essential to the success of the EVMS implementation. Without it, the process will fail. Establishing an implementation team responsible for developing the strategic plan and schedule is a critical initial step. Read more…

Step 2 – Pre-Implementation Assessment & Gap Analysis

Before implementing an EVMS, it important to have a clear understanding of the state of the current project control system. This is essential for determining the full scope of the implementation effort. Comparing the current processes and procedures to the 32 guidelines in the EIA-748 Standard for Earned Value Management Systems is part of the process.

Internal EVM experts or an independent third party commonly conduct this assessment, sometimes referred to as a requirements analysis or gap analysis.

The intent is to produce fact-based information useful for creating a realistic implementation plan. What are the processes, tools, and training that need to be enhanced or implemented? Based on this knowledge, an implementation plan and schedule can be produced that defines the specific tasks and milestones to accomplish the end objectives.  Read more….

Step 3 – System Structure and Integration

At the beginning of the system enhancement or design stage, it is useful to focus on each of the subsystems that support the nine EVMS process areas and how they integrate with each other. When the customer’s reviewing agency reviews the company’s EVMS, it will look at each of the following process areas:

  • Work Organization
  • Planning and Scheduling
  • Work/Budget Authorization
  • Accounting
  • Indirect Management
  • Management Reporting and Analysis
  • Revision sand Data Maintenance
  • Material Management
  • Subcontract Management

The EIA-748 32 guidelines are the foundation for determining if an EVMS meets the requirements for a compliant system. Developing flow diagrams and storyboards are useful tools at the beginning of the design phase to note what needs to be added or enhanced to create a fully integrated EVMS as well as to satisfy the EIA-748 guidelines. Read more…

Step 4 – The System Description Document

The primary document for describing the system and how it satisfies the EVMS guidelines is the EVM System Description. Internal formal procedures support this document. The system description and related procedures are meant to be the all-inclusive explanation of the EVMS characteristics and how the system is used to manage a project from inception to completion.

The EVMS storyboard and system description are complementary work efforts. An excellent starting point for the system description is to develop an outline that describes the subsystems for each of the nine process areas. Read more…

Step 5 – Training

Training is an important part of the implementation process. This includes upper level management, project managers, functional managers, control account managers (CAMs), and analysts. The training should reflect the EVM System Description, as the government reviewing agency’s team will assess whether or not a project is following the company’s EVM System Description. The development and execution of the training plan as part of the overall implementation plan helps to ensure the various end-users complete the training they need. Read more…

Step 6 – System Implementation

System implementation on a pilot project requires dedicated teamwork and is the most time consuming of the seven steps. An easier approach is to implement the EVMS on a new project so that all project artifacts reflect the system description at the onset.

Projects that run effectively and efficiently often translate into higher profit margins and result in more company business. Read more….

Step 7 – Operation and Use Verification

Once in place, periodic internal reviews, sometimes called self-surveillance, can be done to ensure that the EVMS implementations on the various projects continue to comply with the company’s EVM System Description. This helps to prevent the system from atrophying over time. It also provides an opportunity to address additional training needs, resolve common implementation issues, and enhance the system.

Independent third parties can also assist with the self-surveillance process. This provides an added benefit by using experienced outside consultants who regularly perform mock compliance or certification and other types of reviews. The outside consultant team can also update a company on the latest issues the government agency review teams are focusing on, provide a fresh look at how an EVMS is used on a project, or bring new ideas to the table that can improve the company’s EVM System.

Similar to the implementation and use of the EVMS, it is important to establish a repeatable process for self-surveillance, capture the results, identify the problem areas, identify actions to address the root cause of the problems, and track them to closure. Read more….

For a full-length copy of this article, see our EVMS Educational Center.

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Earned Value Management Misconceptions – 5 Common EVMS Errors

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Earned Value Management  Misconceptions – 5 Common EVM Errors

Earned value management misconceptions can introduce errors into a project control system. If your company is exploring a potential contractual need for using earned value management or implementing an Earned Value Management System (EVMS) to gain a competitive edge, dispelling common misconceptions is a useful exercise.

First, it is important to understand that the purpose of an EVMS is to provide:

  • Reliable, timely, actionable information that can be used to manage a project more effectively
  • Repeatable processes that foster credibility and goodwill with customers

Second, it is critical to keep in mind that when implementing an EVMS:

  • Do not make it more difficult than it needs to be
  • Avoid the “learning by mistakes” approach, which can increase costs and end-user frustration levels

Here are 5 of the most common misconceptions Humphreys & Associates consultants frequently encounter and some observations to help dispel them:

1. If you install software you have everything you need for a EVMS

False. Software toolsets can assist in the EVM process, but software is just one component. An EVM System requires instilling a disciplined and repeatable process that integrates all of the project control subsystems. This includes work organization, planning and scheduling, budgeting, accounting, work performance and analysis cycles, estimating what it will take to complete the remaining work (in time and resources) and managing changes to ensure the process provides useful information from project inception to completion.

The people using the project control system are a critical component to the successful execution and completion. All project stakeholders must actively use the system including upper level management, project managers, integrated product team (IPT) leads, schedulers, and control account managers (CAMs).

Beware of those who suggest that implementing a software tool set alone equates to an EVMS. Read more…

2. An EVMS prevents budget overruns or schedule delays

False. Unfortunately, this is a common misconception of both contractors and government program offices.

Properly used, an EVMS is an early warning system. It provides the means to identify issues early and proactively address them before they influence the ability to meet contractual requirements whether technical, schedule, or cost. Knowing how to identify risks and opportunities is an integral part of an EVMS. It is essential that managers at all levels know how to use the information the EVMS provides so they can respond quickly to deviations from a baseline plan.

EVM is a robust and effective tool when used correctly. Read more…

3. Variances are a bad thing

False. This is common misconception of both contractors and government project managers. The worst part of this misconception is that it causes people to do unwise things, such as hiding schedule or cost variances or producing rosy estimates at completion.

Hiding variances negates the whole purpose for implementing an EVMS. Variances are the early warning mechanism of an EVMS. Most projects endeavor to produce a reasonable and executable baseline plan, but what typically occurs is that work will deviate to some degree from the plan.

The performance variances and indices provide the ability to quickly identify deviations from the plan and determine the impact to the project.

That means management can be proactive and keep the project on track. Read more…

4. An EVMS is too rigid, requires too much detail

False. An EVMS does not inherently require more detail. A common error made by companies new to EVM is to drive the data down into too much detail, which can over complicate the planning and scheduling, budgeting, performance measurement, analysis, and change control processes.

What EVM does require is a defined logical approach to produce technical, schedule, cost, and risk data that are then fully integrated and tailored to the needs of each project. That means more upfront planning is required to determine the level of detail needed to manage the work effort based on risk, cost, and other factors for management visibility.

EVMS most certainly adds a level of discipline to the project management process. Frequently, the “too rigid” label is a result of self-induced pain or lack of understanding.

What is easy to overlook are the hazards, business risks, and costs related to ad hoc processes or project management by heroics. This results in regularly failing to meet objectives (overruns, late deliveries, last minute scrambles to the finish line), lack of visibility into the real status of the project (which results in unpleasant surprises for management), quality issues, rework, or unhappy customers and high frustration levels.

EVM principles can be used to improve the management and control of any project. Read more…

5. There is always a high cost to implement and use an EVMS

False. The implication in the statement above is that EVM provides limited or negative return on investment. This is a common argument when new business processes are introduced, especially when familiar processes are already in place; EVMS is a contractual requirement. To win certain contracts, an EVMS is required – for good reason. In these cases, management’s choice is either implement or decline to bid.

There is always a price tag for implementing new processes. The focus should be on determining the gap between what processes a company is currently using compared to the EIA-748 32 Guidelines. It may be a narrow or large gap – that gap determines the scope of the system design and implementation processes needed.

What is important to remember (and often missed) is that EVM is a set of proven project management principles that are applicable to any project. It can improve the ability of a company to meet commitments, increases management visibility, which helps to prevent expensive surprises and demonstrates a high level of project management maturity that can be used to a competitive advantage. All of these factors can reduce the overall cost to execute projects and, in turn, increase the company’s profit margin.

Yes, there is a cost to implement a disciplined project management process. But there are also significant, avoidable costs should a government or other large customer decides a company’s project control system is insufficient or is not implemented properly. Expensive emergencies and lost contracts can be averted by investing in proactive upfront planning.

Your credibility and goodwill with customers as well as your company’s ability to win projects may well warrant investing in a well-executed EVMS. Read more…

For a full-length version of this post, see Humphreys & Associates EVMS Education Center.

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