Credible Plans, Integrated Reporting, and Control Systems
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Transcript of Credible Plans, Integrated Reporting, and Control Systems
CreatingCrediblePlans,IntegratedReporting,andControlSystems
Part1
[email protected]+13032419633
IPMWorkshop 2015
ThomasCoonceCostAnalysisandResearchDivisionInstituteforDefenseAnalysestcoonce@ida.org+17035756634
RickPriceProjectManagement &PlanningOperationsPrincipalLockheedMartinSpaceSystemsCompanyRick.a.price@lmco.com+13039711826
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Learning Objectives
• TLO #1 – the student will understand how to apply the 5 core processes needed to produce a credible Performance Measurement Baseline.
• TLO #2 – the student will understand how to objectively measure progress and use the performance information to control the program.
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Building a credible PMB for Wilbur and Orville’s flying machine.
• Our talk today uses the Wright Brothers Flyer as an example for developing a Credible PMB
• The Urban Legend of Orville and Wilbur's efforts to invent manned flight has been revealed in McCullough’s book.
• Their work has all the attributes of the Five Core Processes.
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There is a Method to our Madness
• If you’re over 60 you’ll recognize this chart template for HIPO, used to describe Inputs, Processes, Outputs we’re using to create a credible Performance Measurement Baseline, measure progress, and control the program
• These are the minimum HIPO elements, there can be and should be more.
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The data and processes needed to create a Credible Performance Measurement Baseline
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A Readable Version
The Five processes needed to build a credible PMB❶ Define Done in Units of Measure Meaningful to the
Decision Makers. ❷ Develop the Plan and Schedule to reach Done as planned.❸ Define the Resources Needed to Reach Done as Planned. ❹ Adjust Plan for Reducible and Irreducible Risks.❺ Finalize the Risk Adjusted Measures of Progress Toward
Done.
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Inputs and Outputs for Building the Credible Performance Measurement Baseline
• Customer Capabilities• Time phased budget• Desired completion date• Available technologies• Time phase resources• Reference Class Data • Programmatic and technical risks with
probabilities and impacts• Historic uncertainties• Measures of Effectiveness• Measures of Performance
• Work Breakdown Structure• Integrated Master Plan• Technical Performance Management
Plan• Initial Integrated Master Schedule• Time Phased Staffing Plan• Schedule Reserve• Management Reserve• Risk Register and Mitigation Plans• Adjusted Integrated Master Schedule• Risk Management Plan
Inputs Outputs
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❶ DEFINE DONE
Define Done in units of measure meaningful to the decision makers for each deliverable in the WBS.
Measures of Effectiveness (MOE), Measures of Performance (MOP), Technical Performance Measures (TPM), and …illities are defined before the work starts, for each needed capability that accomplishes the mission or fulfills the Business Case.
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Systems Engineering Concepts Used By The Wright Brothers [1]
SE Concept Wright Brothers Activities
OperationalConcept
Vision: clear concept of the system they were developingMission Requirements: powered flight for substantial time and distanceScenarios: recognition of a key scenario involving lateral control during flight
Define the System Boundary Understood the need for the pilot to be part of the system
Objectives Definition of distance and time objectives
Derived Requirements
Horsepower and weight of the engineThrust of the propellers
Requirements Management Managed weight requirement of the engine carefully
Functional Analysis
Understood the functions of the airplane, which drove their design processFurther understood the functions of the propulsion subsystem
Physical Architecture & Interfaces
Matched the physical architecture to the functions of the airplaneInterfaces between the pilot and the control surfacesInterface between the engine and propellers TC
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Systems Engineering Concepts Used By The Wright Brothers [1]
SE Concept Wright Brothers Activities
Prototypes and Testing
Built a successfully more complex set of gliders before building the airplaneFirst airplane was successful, due to the series of gliders and kitesEmployed sophisticated testing with each prototype, atypical of others at the time
Trade-OffDecisions Design favored control of the airplane over stability
Test System
Extensive even during glider testsAllowed problem identification and solving during all test phasesCreated wind tunnel to address discrepancy between their test data and theliteratureIncluded the careful selection of the test siteIncluded in the first airplane
Verification Best illustrated by testing of the engine to determine whether it met itsrequirements
Validation The final test that proved flight was possibleTeam Activities Two brothers formed a design-build team TC
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Measure of Effectiveness (MoE)
Measures of Effectiveness …• Are stated in units meaningful to the buyer,• Focus on capabilities independent of any technical
implementation,• Are connected to the mission success.
Operational measures of success that are closely related to the achievements of the mission or operational objectives
evaluated in the operational environment, under a specific set of conditions.
MoE’s Belong to the End User“TechnicalMeasurement,”INCOSE–TP–2003–020–01
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Measure of Performance (MoP)
Measures of Performance are …• Attributes that assure the system has the capability and capacity to
perform,• Assessment of the system to assure it meets design requirements to
satisfy the MoE.
Measures that characterize physical or functional attributes relating to the system operation, measured or estimated
under specific conditions.
“TechnicalMeasurement,”INCOSE–TP–2003–020–01
MoP’s belong to the Program – Developed by the Systems Engineer, Measured By CAMs, and Analyzed by PP&C
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Technical Performance Measures (TPM)
Technical Performance Measures …• Assess design progress,• Define compliance to performance requirements,• Identify technical risk,• Are limited to critical thresholds,• Include projected performance.
Attributes that determine how well a system or system element is satisfying or expected to satisfy a technical
requirement or goal
“TechnicalMeasurement,”INCOSE–TP–2003–020–01
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What Done Looks Like for the Wright Brothers’ Military Flyer
• Propose $25,000 to build and deliver a flyer by 1st week in August 1908
• Conduct Acceptance testing for 30 days thereafter
Contract Specification
Value/Goal
Passenger # Two persons
Payload 350 lbs
Range 125 miles
Air Speed 40 mph
Duration Aloft One hour
ManeuverabilityBe steered in all directions w/o difficulty and in perfect control at all times
Ease of UseAn intelligent man become proficient within a reasonable length of time
Logistics
Assembled and disassembled within one hour and packed into an Army wagon
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❷ DEVELOP A PLAN FOR TECHNICAL SUCCESS
The Technical Plan shows the sequence of work needed to produce products and services that move the program toward Done.
The Technical Plan can take many forms. From a formal Integrated Master Plan / Integrated Master Schedule to a Kanban work plan or Scrum Release/Sprint/Task Plan in Agile Software Development
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Develop the Plan and Schedule
• Define the technical approach to building the product that will allow it to meet the performance and effectiveness goals– Identify all the variables that will impact the solution to the
technical and operational requirements– Orville and Wilbur used the spiral development approach for
the Wright Flyer
• Sequence the work to assure the increasing maturity of the deliverables supports the plan to reach Done.
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The Wright Brothers’ Technical Plan
• Modify aircraft to reduce weight from 845 to 800 pounds
• Modify aircraft and controls for two persons
• Increase HP from 21 to 31 horsepower
• Apply a Modify – Test – Modify approach
• Spend lots of time practicing (and not kill yourself)
• Dry run assembly and disassembly procedures
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❸ DEFINE THE PROGRAMMATIC PLAN
The Programmatic Plan describes all the activities that enable the Technical Plan to function properly. What work do we need to do in what order and what’s the cost of that planned work.
What facilities, resources, equipment, and materials are needed to reach done as planned.
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Define the Programmatic Plan
• Assure the programmatic plan aligns with the technical plan
• Qualified Staffing Plan to produce the needed outcomes at the needed time
• Facilities and equipment needed to produce the products
• Material availability and readiness Plan
• Phased funding available to sustain the planned progress of the Technical Plan
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Wright Brothers’ Flyer Resources Needed• Facilities and equipment for modifications
– Fabrication hangar @ Kitty Hawk– Launching track– Catapult
• Materials (propellers, wood, fabric, sewing supplies, chain, etc.)
• Test areas– Kitty Hawk at Kill Devil Hills
• Requisite labor skills– Orville & Wilbur Wright – Charlie Furnas (Dayton mechanic)– Charlie Taylor (engine design/builder)– Carpenters at Kitty Hawk (to rebuild the hangar)
• Money to support the development/build effort
• GFE– Site availability at Ft Myer, VA– Hangar shed at Ft Myer, VA
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Initial Wright Brothers’ Summary Level IMS
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❹ ADJUST FOR REDUCIBLE AND IRREDUCIBLE RISK
Any impediment reduces the probability of success. Each impediment must be identified, a plan to address the impediment developed, each handling strategy applied, monitored, and measured to assure there is an increasing probability of success.
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Uncertainties are things we can not be certain about.
Uncertainty is created by our incomplete knowledge; not by our ignorance
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2 Types of Uncertainty – Both Create Programmatic and Technical Risk
Uncertainty
Irreducible(Aleatory)
Reducible(Epistemic)
NaturalVariability
Ambiguity
OntologicalUncertainty
ProbabilisticEvents
ProbabilisticImpacts
PeriodsofExposure
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Assemble a credible WBS and Integrated Master Plan / Integrated Master Schedule (IMP/IMS)
–WBS Dictionary says what will be built
–IMP/IMS says how, where, when, and what will be built and the processes to build it.
Identify Reducible – Event Based – uncertainties and the resulting risks from WBS Dictionary and IMP Narratives in the Risk Register
Put these risks in the Risk Register, with probability and impacts
Develop risk reduction plans and place them in the IMS using CBB funding.
How to Build a Risk Adjusted IMS in 8 Steps
0
1
2
3
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Assess the Irreducible – naturally occurring –uncertainties and the resulting schedule and cost risks in the WBS and IMS.
Use Monte Carlo Simulation to determine schedule margin and budget impacts from work activity durations to handle these irreducible uncertainties.
Formulate schedule and cost margin to protect key item deliverables in the IMS.
How to Build a Risk Adjusted IMS in 8 Steps
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5
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Determine cost and schedule impacts of unmitigatedrisks in the risk register with their exposure and impact and place them in Management Reserve and Schedule MarginAssemble mitigated Irreducible (Aleatory) and Reducible (Epistemic) risks with the unmitigated event–based risks into the Total Allocated Budget– Risk handling plans included in baseline for reducible
and irreducible in the PMB.– Risk Handling in Management Reserve.
Building a Risk Adjusted IMS in 8 Steps (Concluded)
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AdjusttheIMSwithrearrangingparallelorserialwork,changingscope,oraddresources.
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Wright Brothers’ Risk Register and Risk Strategy
1. Control. Buy $1.6K of key spare parts and send to Kitty Hawk
2. Accept. Add schedule margin in schedule
3. Accept. Add schedule margin in schedule
4. Accept. Add schedule margin in schedule
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Wright Brothers’ 1908 Flyer Management Reserve Calculation
Element Cost CL Comments
P80 Cost $19,696 80%
This is the cost at the 80% CL assuming only non-reducible risks in the RR
Deterministic BACf
$16,355 < 1%Final BAC based on the resource-loaded schedule
MR (P80 Cost - BACf)
3,341 Calculated MR
MR as a percent of BACf
20.4%Caculated MR % of BACf
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Wright Brothers’ 1908 Flyer Schedule Margin Calculation
ElementFinish Date CL
MonthsWork Days
IMS Deterministic Pf
Duration and Date:= 7.25 152 9/15/1908 5%
Need Duration and Date:= 7.75 163 9/30/1908 80%
Schedule Margin:= 1 11
Duration
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Schedule Margin in Final WB’s Flyer IMS
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❺ DEVELOP OBJECTIVE MEASURES OF PROGRESS
For each deliverable develop an objective measure of progress to plan using physical percent complete supported by Quantifiable Backup Data (Objective Criteria)
Use these measures to assess progress and identify variances requiring corrective actions to Keep the Program Green.
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Objective Measures of Progress to Plan
• Measures of Effectiveness (MOE)
• Measures of Performance (MOP)
• Technical Performance Measures (TPM)– Weight TPM Plan– Risk Burn Down Plan– Schedule Margin Burn Down Plan
• All the other …ilities– Availability (assemble within one hour)– Usability (simple in construction and operation)
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Weight TPM for Wright Brothers 1908 Flyer
770780790800810820830840850860870
15-Feb-08 15-Mar-08 15-Apr-08 15-May-08 15-Jun-08 15-Jul-08
Poun
ds
15-Feb-08
28-Feb-08
15-Mar-08
31-Mar-08
15-Apr-08
30-Apr-08
15-May-08
31-May-08
15-Jun-08
30-Jun-08
15-Jul-08
UpperLimit 860 855 845 835 825 815 800 800 800 800 800Planned 845 840 830 820 810 805 800 800 800 800 800Target 800 800 800 800 800 800 800 800 800 800 800
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What’s Next
• TLO #1 – the student will learn how to produce an integrated report of the Technical progress consistent with the Programmatic progress, detect variances, and suggest corrective actions.
• TLO #2 – the student will understand how to objectively measure progress and use the performance to manage the program.
• Earned Value Management is part of a Technical and Programmatic control system– Integrated risk, performance, effectiveness, technical and other
measures provide leading indicators of program performance.
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References
1. “The Concepts of Systems Engineering as Practiced by the Wright Brothers,” Dennis Buede, Stevens Institute of Technology School of Engineering, Hoboken, NJ 07030
ExecutingtheCrediblePlan,UsinganIntegratedReporting
andControlSystemPart2
[email protected]+13032419633
IPMWorkshop 2015
ThomasCoonceCostAnalysisandResearchDivisionInstituteforDefenseAnalysestcoonce@ida.org+17035756634
RickPriceProjectManagement &PlanningOperationsPrincipalLockheedMartinSpaceSystemsCompanyRick.a.proce@lmco.com+13039711826
38
Learning Objectives
• TLO #1 – the student will learn how to produce an integrated report of the Technical progress consistent with the Programmatic progress, detect variances, and suggest corrective actions.
• TLO #2 – the student will understand how to objectively measure progress and use the performance to manage the program.
• Earned Value Management is part of a Technical and Programmatic control system– Integrated risk, performance, effectiveness, technical and
other measures provide leading indicators of program performance.
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In Part 1, we talked about …
• Addressed the five core processes needed to produce a credible Performance Measurement Baseline (PMB).
• Showed how to use objective measures of progress and how to inform program performance with these measures
• In Part 2, you’ll see how to execute the program with this information.
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Executing the Performance Measurement Baseline
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A Readable Version
The Four processes needed to execute the credible PMB❶ Compare Technical and Programmatic Actuals to Plan❷ Compare BCWP and Cost and Schedule Performance
Data with Management Reserve (MR) and Schedule Margin (SM) balances
❸ Revise Integrated Master Schedule (IMS) and Risk Register
❹ Run or Rerun Monte Carlo Simulation
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Inputs and Outputs for Building the Credible Performance Measurement Baseline
• Customer Capabilities• Time phased budget• Desired completion date• Available technologies• Time phase resources• Reference Class Data • Programmatic and technical risks with
probabilities and impacts• Historic uncertainties• Measures of Effectiveness• Measures of Performance
• Work Breakdown Structure• Integrated Master Plan• Technical Performance Management
Plan• Initial Integrated Master Schedule• Time Phased Staffing Plan• Schedule Reserve• Management Reserve• Risk Register and Mitigation Plans• Adjusted Integrated Master Schedule• Risk Management Plan
Inputs Outputs
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❶ COMPARE PLANNED TO ACTUAL PERFORMANCE
Compare technical and programmatic performance to the planned performance. Identify variances needed to make decisions about corrective actions to Keep the Program Green.
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Compare Planned to Actual Performance
• Physical Percent Complete– Planned– Actual
• Do this at the Work Package level– Quantifiable Backup Data– Avoid averaging out the variances at the Control Account
level
Objectively assess accomplishments at the Work Performance LevelEIA-748-C, page 1
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Wright Brothers’ Technical, Cost and Schedule Progress
0.80
0.85
0.90
0.95
1.00
1.05
1.10
770780790800810820830840850860870
15-Feb-08 15-Mar-08 15-Apr-08 15-May-08 15-Jun-08 15-Jul-08
CPI/S
PI
Poun
dsWBs'1908FlyerIntegratedProgress
(2/28/1908)
UpperLimit Planned Target Achieved SPI CPI
Compare side-by-side the Technical Performance (Weight) with the Programmatic performance CPI and SPI
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❷ COMPARE MR AND SM BALANCES
Using the performance data and the variances, the computed BCWP from measures of Physical Percent Complete.
Assess planned Management Reserve and Schedule Margin with the current MR and SM and inform EAC and ETC from past performance.
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Compare BCWP with MR and SM
• With actual BCWP assess impact on Estimate at Completion and Estimate To Complete.
• Assess planned Management Reserve against actual Management Reserve
• Assess planned Schedule Margin against actual Schedule Margin
• Assess planned risk burn down against actual Risk Burn Down
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Wright Brothers’ MR Planned Use vs Actuals
$0$500
$1,000$1,500$2,000$2,500$3,000$3,500$4,000
WB 1908 Flyer Planned vs Actual MR Use (15 May 1908)
MR Planned Balance MR Actual Balance
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Wright Brothers’ Schedule Margin Burn Planned Use vs Actuals
In May, when the schedule margin went below plan, immediate corrective action is needed to get back on Schedule Margin Plan
0
2
4
6
8
10
12
15-Feb-08 15-Mar-08 15-Apr-08 15-May-08 15-Jun-08 15-Jul-08 15-Aug-08 15-Sep-08
Day
s
WB 1908 Flyer Planned vs Actual Schedule Margin Use (15 May 1908)
Schedule Margin Plan Balance Schedule Margin Actual Balance
This dipcharacterized as negative slack
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❸ REVISE IMS AND RISK REGISTER
With this data, update the Integrated Master Schedule and Risk levels in the Risk Register for future periods of performance.
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Revise IMS and Risk Register
• Every reporting period update the Risk Register with actual assessment of – Reduced risks– Actual margin needed for unmitigated and irreducible risks
• Adjust Risk Register contents for current assessments– New risks– Retired risks– Changes in risk attributes
• Update ETC, EAC, and ECD with the statused IMS and Risk Register
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❹ RUN AND RERUN THE SCHEDULE RISK ANALYSIS
Schedule Risk Analysis (per DI-MGMT-81861) at periodic intervals to confirm the Estimate to Complete and the Estimate At Completion are still within acceptable values to ensure the probability of program success.
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Run and Rerun Schedule Risk Analysis
• With updated Risk Register – rerun the Schedule Risk Analysis
• Reassess EAC, ECD, and ETC
• Determine sensitivity indices (which elements are most likely to cause the forward plan to go awry)
• If needed– Replan IMS, possibly with more schedule margin– Add resources– Adjust technical solution
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Summary
• Cost and Schedule performance informed by Technical Performance– At IBR Technical Performance plan defines the work activities
in the IMS• Build a risk adjusted PMB
– Reducible and irreducible risks in the risk register, traceable to the IMS.• Budget active mitigation activities• Protect unmitigated risks with Management Reserve and
Schedule Margin• Make sure programmatic data is aligned with Technical
Performance Data• Perform these activities continually during execution to Keep the
Program Green
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Questions???
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