By Scott Phillips, AMCOMApril 10, 2017
For those in the Army Acquisition community, Earned Value Management (EVM) is a term that has long been synonymous with major acquisitions, particularly for those greater than $20 million with cost or incentive contracts. Though EVM is a widely accepted industry best practice for program management and is frequently used across the Department of Defense (DoD), the Federal government, and the commercial sector, EVM has not been applied extensively to programs within the Army's Organic Industrial Base (OIB) largely because it has not been required for the vast majority of the OIB's sustainment-oriented programs.
However that changed two years ago at Letterkenny Army Depot (LEAD) when the requirement for EVM reporting was mandated for the Sentinel Common Platform Upgrade and more recently, with the award of eight Indirect Fires Protection Capability Inc.2 Intercept / Multi-Mission Launchers (IFPC2-I/MML or MML). IFPC2-I/MML is one of the Army's trendsetting acquisition programs and offers a fresh, distinctive approach to life-cycle capability development; its success as well as that of the Sentinel program is crucial, not only to produce new capabilities for the soldier, but also new competencies for LEAD in terms of EVM planning and expertise.
For LEAD, EVM is the cornerstone and guiding principle for all other analytics, business intelligence, and intensified cost reporting necessary to make informed decisions. Moreover, as expertise in EV at LEAD's is advanced, so too will the depot's strength as a competitive manufacturer for major DOD acquisition programs.
The implementation of EVM at LEAD has not been without its challenges and although a growing number of personnel and leadership at LEAD are coming up to speed on EVM, a large number of LEAD artisans, management and support personnel are still not familiar with many of the requirements associated with EVM implementation. EVM implementations are resource intensive, there is a great deal of rigor required up-front during planning to deliver an accurate, high-quality plan from which actionable data and analyses can be derived.
EVM is routinely categorized as just another set of project management measures and metrics, often portrayed as requiring large amounts of data, number-crunching and mathematical formula application for successful execution. However, the math and metric aspects of EVM account for less than 20 percent of the 32 guidelines contained in the EIA-748 standard for how to apply EVM.
LEAD's current approach to projects, requiring EVM, involves a highly-structured organization, the establishment of a baseline plan for accomplishment of all program objectives, and the use of earned value techniques across all functional disciplines that support a program. Unless a site is willing to applying this kind of rigor early and up-front and during all phases of program execution, the results of EVM math will never produce meaningful, actionable reporting of use to problem identification and management decision making.
LEAD continues to work closely with the Program Executive Office Missile and Space (PEO M&S) Cruise Missile Defense Systems (CMDS) at Redstone Arsenal, AMCOM and the AMCOM Logistics Center (ALC), and others to establish and refine all aspects of its EVM capabilities. Though still young in terms of EVM competencies and expertise, LEAD's current capabilities have successfully met the customer's requirements for EVM data and reporting for the Sentinel program and LEAD will soon deliver its first monthly EVM reporting package for MML.
Develop a culture of EVM in all new programs (EVM-Lite) and existing programs, as directed that will improve the accuracy and precision of managing and reporting production.
Equipped with the ability to generate reports analogous to the Integrated Program Management Report (IPMR) formats, LEAD is now in the process of launching a program to instill the principles of EVM in its organizational culture. To achieve this, LEAD has reached out to the Army Materiel Command (AMC), Defense Acquisition University (DAU), AMCOM, the ALC, for assistance in training the remainder of its workforce, and for assistance with the development LEAD's formal Earned Value Management System (EVMS). The goal is that every LEAD employee will, at the very least, have completed DAU's EVM 101 by the end of FY17 and that LEAD will achieve Defense Contract Management Agency (DCMA) EVM site validation, required by DoD when cost and/or incentive based contracts exceed $100 million. Early assessments indicate the time and financial investment for EVMS site compliance at LEAD will be similar to the requirements routinely associated with an ISO 9001 certification or accreditation, no small investment in terms of labor and funds. While growth, training, and sustainment requirements associated with EVM require significant resources and expertise, the majority of these costs pay for themselves in terms of enhanced program performance insight and early identification and action on program risks and opportunities.
EVM continues to produce a win-win scenario for both the customer and LEAD. The customer and warfighter are getting the material and project performance data they require, and LEAD has gained a powerful new 'industry-caliber' management tool to control program risk.