Performance-Based Earned Value


Program Management Improvement Accountability Act

PMIAA includes Section 2, Project Management. It adds additional functions to the Office of

Management and Budget (OMB) Deputy Director for Management. The new requirements

include Program and Project Management. 


Sec. 2 Excerpts:

‘‘(A) adopt government-wide standards, policies, and guidelines for program and project

management for executive agencies;
‘‘(B) oversee implementation of program and project management for the standards, policies,

  and guidelines established under subparagraph (A);
‘‘(C) chair the Program Management Policy Council established under section 1126(b);
‘‘(D) establish standards and policies for executive agencies, consistent with widely accepted

standards for program and project management planning and delivery;
‘‘(E) engage with the private sector to identify best practices in program and project

management that would improve Federal program and project management;
‘‘(H) establish a 5-year strategic plan for program and project management.


Project Management Body of Knowledge®


The Project Management Institute (PMI) Project Management Body of Knowledge®

(PMBOK® Guide) contains an ANSI standard (ANSI/PMI 99-001-2013). PMBOK® Guide

should be considered to comply with the objectives of the PMIAA and to replace EIA-748,

the Earned Value Management System (EVMS) Standard. A rationale to discard EVMS was

first provided in my article in Defense AT&L, “Earned Value Management Acquisition Reform

(Nov.-Dec. 2010).  It is recommended that DoD consider the article, and the white paper

described below, "DoD Acquisition Reform: EVMS-lite to Program/Project Management,"

when developing the  required standards, policies, and guidelines. PMBOK® Guide is

used by project management practitioners world-wide and  will provide program and project

management transparency.


Pertinent excerpts from PMBOK® Guide are at the tab, "PMBOK Excerpts." 


Excerpts from the 2010 article and a link to it follow:

1. In 2009, DoD reported that EVM, based on the EVMS Standard, no longer serves its

intended purpose.

2. Sen. Susan Collins stated that the GAO observed that contractor EVM reporting lacks

consistency and leads to inaccurate data and faulty application of the EVM metric. “In other

words, garbage in, garbage out.” Collins concluded that, “With improved EVM data quality,

both the government and the contractor will be able to improve program oversight, leading

to better acquisition outcomes.”
3. The time has come to ask whether DoD and other federal agencies should continue to rely

on ANSI-748 or should adopt the best practices of commercial companies that use EVM

voluntarily, not because of a contractual mandate.
4. Project management standards and best practices that are used by commercial companies

should be considered for acquisition reform.
5. Commercial information technology companies in India and South Korea use EVM

processes and best practices based primarily on the PMBOK® Guide and its focus on the

technical baseline and Technical Performance Measures (TPM). (See article, Performance-

based EV in Commercial IT Projects, at tab "Articles and Tutorial"
6. PMBOK® Guide practices include:

  1. Differentiating the product scope from the project (work) scope
  2. Establishing a requirements baseline
  3. Use of TPM to assess planned vs. actual technical performance.


White Paper,"DoD Acquisition Reform: EVMS-lite to

Program/Project Management," July 27, 2018

Excerpts:

More than 20 years ago, the founding fathers of the Earned Value Management System

(EVMS) stated their visions for the pending EVMS Standard. That standard was developed

as a Voluntary Consensus Standard (VCS) to replace the DoD document, “Cost/Schedule

Control Systems Criteria,” which had been used since 1967 for capital acquisitions.

Their visions, stated below, have not been realized. A path to effective, integrated program

and project management (P/PM) should include changes to regulations and policy to require

that EVM be linked with systems engineering, technical performance measurement (TPM)

and risk management. The path should include elimination of the regulations that require

compliance with the EVMS Standard, EIA-748-C, in favor of internal management processes

that are consistent with the most widely-accepted VCS for P/PM,  the Project Management

Institute (PMI) Guide to the Project Management Body of Knowledge (PMBOK® Guide).


Federal law, OMB policy, and recent DoD acquisition reform initiatives signal that the

federal government and DoD have started down that path.

Not Widely Accepted
A worldwide survey of EVM users by the PMI, in 2010, disclosed that the private sector has largely ignored

EIA-748-C. When the use of EVM is voluntary and not a contractual mandate, only 17 percent of the

respondents used EVM based on EIA-748-C.

Seventy percent of respondents to the Grant Thornton 2016 Government Contractors Survey stated they

would not use EVMS if not required to do so. Twenty-eight percent reported having contracts that require

use of EVMS. Of those using EVMS, only 37 percent believe it to be a cost-effective management tool and

only 25 percent would adopt EVMS voluntarily.


TPMs and Risk Management Not Integrated


Little Insight and Less Management Value


Applicability to DoD
PMIAA gave a potential waiver to DoD by stating it is not applicable to DoD “to the extent that the

provisions…are substantially similar to or duplicative of…policy, guidance, or instruction of the

Department related to program management.’’ However, current DoD policy, guidance, and instruction

related to program management and EVM are not similar to or consistent with the most widely accepted

guide for P/PM, PMBOK® Guide.

A PM’s needs that are covered by the PMBOK® Guide but are not mentioned in EIA-748-C include the

technical or product baseline, requirements management and traceability, risk management, and project

procurement management.
PMBOK® Guide includes standards and principles that meet the needs of P/PM but are absent from

EIA-748-C (Table 1).


EIA-748-C Is No Longer a VCS per OMB Circular A-119 Criteria

EIA-748-C is no longer a VCS because it is “otherwise impractical.” It fails to serve DoD’s procurement and program

needs. It is not prevalently used in the national and international marketplaces. Most importantly, EIA-748-C

does not address the state of knowledge and technology since it was last revised. It is still silent on the product

or technical baseline, risk management, and on tracing the requirements baseline to the schedule and work packages.

The Quality Gap has not been closed.

Finally, the National Defense Industrial Association Integrated Program Management Division (NDIA)

is the author and steward of EIA-748-C.  NDIA is using SAE International as the VCS body. However, NDIA missed the

deadline to obtain SAE approval of reaffirmation. 


OMB Memo: Improving the Management of Federal Programs and Projects through Implementing the

  PMIAA, June 25, 2018


Recommended Four Step Plan for Acquisition Reform


EVMS-lite
The rationale for and implementing details of EVMS-lite were included in my letter to Chairman Thornberry,

11/17/13, Subj: Expanded NDAA Defense Acquisition Reform – EV.
Excerpt: “It is also recommended that DOD policy be revised to require contractor compliance with three

amended or tailored EVMS guidelines and to remove compliance with eight (now twelve) guidelines. In my

opinion, the cost savings by eliminating compliance with…guidelines will offset any cost increases that

may be incurred because of the tailored guidelines.”


Conclusion
DoD should discontinue use of EIA-748-C because it is impractical, ineffective, and has not been

reaffirmed. It fails to serve DoD’s procurement and program needs. It has failed to keep current with

changes in the state of knowledge and technology and is less useful than the PMBOK® Guide. The end

of the path should be a set of internal management processes and/or VCSs for P/PM, as required by the

PMIAA and OMB policy. PMBOK® Guide is the most widely accepted P/PM VCS and it components should

be included in the internal management processes.

The recommendations above are needed to fulfill the visions of EVM’s founders, to implement

the acquisition reforms and legislative intentions of senators and congressmen, to halt systemic findings

like those in the DoD Report, and to comply with the PMIAA.


Letter to Ms. Weichert (OMB) and Mr. Fahey (DoD), 7/26/18
Subj: Successful Implementation of PMIAA by all Agencies, including DoD

Letter to Ms. Weichert (OMB) and Mr. Fahey (DoD), 7/31/18
Subj: How Commercial IT Companies Use Earned Value Management with P/PM