Weekly Earned ValueF-35 Approach

Weekly Earned ValueF-35 Approach

Suzanne West – Lockheed MartinJim Hoshstrasser – Northrop Grumman

Mike Brooks – BAE SYSTEMS

18 November 2002Tysons Corner, Virginia

14th Annual IPM Conference

2

Introduction

• Weekly EV Has Provided Value Through the Early Mitigation of Cost, Schedule, and Technical Risk

Higher Probability of Achieving Program Plans

ResultResult

3

Agenda

WeeklyEarnedValue

• Weekly EVM as a Value Added Mgmt. Tool

• F-35 Team – Weekly EV Approach

• Lessons Learned

Weekly EVMS as aValue Added

Management Tool

5

WEV – Value Added Management Tool

1

Proactive Measurement of Achievement of Detailed Plans

2Sustained Focus on Key Program Events (IMP/IMS) and Risks

3Weekly Management Review Ensures Corrective Action at the Earliest Possible Time

6

Is Not•A Financial Report

•A weekly CPR

•Closing the Books on a Weekly Basis

•A Weekly Status of Total Contract $ Cost

•A Requirement for More Detailed Schedules (e.g., Weekly Milestones)

Is• A Program Management Tool

• Weekly Measurement of Direct Labor EVM in Hours – No Surprises

• A “Quick Look” at Labor Variances, Indices and Trends

• Integrated With the Overall EVMS Processes and Data

• A Continuous Engagement of Program and IPT Leaders in EVMS

Coordination Among Teammates & Suppliers Essential

What is Weekly Earned Value?

Weekly Performance Assessment Improves Program Management Insight

Weekly Assessment Shortens the Cycle for Problem Identification, Corrective Action, Problem Resolution, and Validation

Weekly Assessment Shortens the Cycle for Problem Identification, Corrective Action, Problem Resolution, and Validation

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Month 1 Month 2 Month 3

Data Reflects Problem

Problem Researched

Cause Identified

Corrective Action Implemented

Data Validates Problem Corrected

Monthly Performance Assessment Cycles

Problem

Point

Monthly

WeeklyData Reflects Problem

Issue Researched

Cause Identified

Corrective Action Implemented

Data Validates Problem Corrected

Weekly Performance Assessment Cycles

Earliest Visibility

Value Added

Do You Already Have the ToolsAvailable to Implement Weekly EV?

• Do You Do Job Order Costing?

• Do You Have Manufacturing Standards?

• Do You Have Systems Which Provide Hourly, Daily, Weekly Information – Including Labor?

• Do You Status BTPs Daily, Weekly Already?

• If you Already Have these Tools / Processes, the Only Changes to Existing Processes for Weekly EV are:

– IPTs/CSIs Assess Progress Against Milestones, CPI/SPI Variances that have Penetrated Thresholds, and Required Corrective Action/Explanations Weekly

-- Develop Interfaces for Cost/Schedule Systems

9

Weekly EVMS Implementation Cost

• Non-Recurring Cost:– Development of Interface(s) to Weekly Database– Initial EVMS/Weekly Hands-on Training

• Recurring Cost:– Periodic Training– CSI Resource(s)?– Time Spent on Weekly Performance Assessment

• Up-Front Planning Requires Minimal Additional Costs– Floor Systems and Accounting Systems Already

Provide Most of the Required Information– IPTs / Business Management Personnel Already Having

Weekly Reviews of Data

10

Weekly EVMS Requirements/Constraints

• Requires Upper Management Commitment & Leadership

• Training for IPTs and CSIs (Cost/Schedule Integrators)

• Appropriate Up Front Planning and Occasional Re-planning

• Disciplines Team Leaders to Make Weekly Assessment of Earned Value

• Requires Strong Business Management Support to Integrate Data

Our WEV Approach Adopted Best Practices

F-35 JSFWeekly EV Approach

12

F-35 EVMS Approach

• True “Partnering” Relationship with Teammates

• Enable Real Time Cost/Schedule Data to the Entire Teams and Customer– Include Major Critical Suppliers

• Manage as True IPTs – Irrespective of Company’s– “JSF First”– “Best Athlete” Manages Team– “Disney Friendly, FEDEX Fast”

• Risk Reduction Approach

We Are Committed to Managing the JSF SDDContract Using Weekly Earned Value Including

Major Critical Suppliers

13

Global Communication

• Use Time Zones as an Advantage– Establish Process That Utilizes Extended Working Day – Manage Meeting Times / Appropriate Involvement

• Utilize e-mail / Net Meetings / Telecons / File Transfer Wherever Possible

12:00 00:00CST

LM Aero (Ft Worth)

06:00 18:00

BAE SYSTEMS

NGC

Data Review

Meetings

Data Exchange

14

DeputyMark Connelly

Tier 2

SEIT Sara Gutierrez

SEIT Stan Urbanek

System Development and Demonstration (SDD) Organization

ContractsGary Lowe

EVMS/FinanceSuzanne West

Trade Studies/Estimates

Phil Stumph

Afford and Cont ImprMike Fortson

Air System VerificationPerry Whitten

SW Mgmt and Collab EnvrLloyd Huff

Engineering IntegrationJohn Browning

Pilot Integ Flight OpsTBD

Subcontract ManagementArt Price

(A) Acting(PC) Program Controls

Business ManagementCraig Happel

Resource ManagementStan Phillips

Tier 3

TrainingSystem

JoAnne Puglisi (LMIS)

SEIT Wally Lafferty

AL InformationSystems

Kevin LeBeau

EngineeringJim Engelland

Aerostructures MfgG. B. Bailey

Customer SupportDon Searles

Business DevJim Schaefer

CommunicationsJohn Smith

P&OSDavid Kohler

Material MgmtArt Price

Business MgmtCraig Happel

Strategy IntegrationRowena Eberhardt

Bus. VenturesLarry McQuien

SecurityJana Moody

IS&TLory Arghavan

Integrators

SupportSystem

Lee Johnson

SEITTerry Harrell

PCPhil Riney

AS IntegrationMatt Maxwell

AS AnalysisDean Hayes

AS ManagementJohn Paquet

AS Specialty EngGreg Brown

AS Life-Cycle Plan Eric Redding

SE ManagementPhil Kruger

Sys Suppt AnalysisScott Cobert

SE OperationsGary Garza

Subcontract MgmtLoyd Gray

SEITDon Searles

PCAnne Bradley

AutonomicLogisticsLuke Gill

Deputy and SEIT

Dave Butcher

PCDonnie Ward

Systems EngineeringJim Engelland

Air VehicleJohn Fuller

PC Catherine GriffinSEIT Larry Mestad

Airframe IPTMartin McLaughlin (NG)

PC Peter BernsteinSEIT Jerry Laster

Vehicle Systems IPTFrank Kirkland

PC Elizabeth LinkSEIT Karen Carrington

Mission System IPTDave Larsen

SEIT Gary Kolling

Special ProjectsFloyd Whitehouse

AV VerificationMark Lambeth

AV Sys MgmtTom Partridge

Specialty EngGuy Gordon

AV IntegrationPaul Park

AV SCMGuy Grosgebauer

Requirements MgmtTom Partridge

Program ControlsGeorgia Hughey

Deputy /SEIT

Tom Phillips

Program IntegrationClay Porterfield

Partner Leadership

Northrop Grumman Peter Shaw BAE SYSTEMS Martin Taylor

Tier 1

PCTBD

IntegratedTest ForcePaul Metz

ITF– Fort WorthJohn Korstian

ITF – Pax RiverTom Phillips (A)

ITF – EAFBTom Phillips (A)

LegalSteve Jeroslow

Business ApproachWorking Group

Peter Walker (LMIS)(A)

ManufacturingG.B. Bailey

International ProjectsSteve Fouga

Program Self Assessment

Tim Halterman

Data ManagementGraham Rutherford

Program SupportGary Howard

Infrastructure Integration and

F-35 OnboardingDavid Bittenbinder

Organizational Effectiveness

TBD

LM F-35 Executive Leadership Team

LM F-35 Program ManagerTom Burbage

Deputy F-35 Program ManagerHenry Levine

Key Program Interface Government/LM Propulsion IPT Fran Ketter Government/LM International IPT Mike Cosentino New Initiatives Paul Leamer

• Programmatic Planning Paul Leamer

• Air Vehicle Integration Kent Clark

• Reliability, Maintainability, Safety and Supportability Greg Brown

• Affordability and Continuous Improvement

Mike Fortson

• Special ProjectsFloyd Whitehouse

• ManufacturingGB Bailey

• IFPCFran Ketter

• Mission PlanningJeff Brandon

• Lethality and Survivability Dean Hayes

• Subcontract ManagementArt Price

• Program SecurityJana Moody

• Ship SuitabilityMike Yokell

• InteroperabilityJohn

Gruetzmacher

• International ProjectsSteve Fouga

• Software ManagementLloyd Huff

• Improvements and DerivativesDave Jeffreys

Key Emphasis Specialists Wizards

15

F-35 Cost & Schedule Summary

• Approx. $17B PMB

• Period of Performance: FY01 – FY12

• 214 Level 5 WBS Legs

• 10,000 Control Accounts

• 25 IMP Events/ 1,500 IMS, – 30,000 Activities (Detailed Planning thru 3/03)– Critical Item Network (2,500 Activities)

• CSIs – 185 for All Teammates– 1 CSI per 30 Tech. Staff

16

SDD Earned Value ManagementTool Architecture

EL-28

MSP

Variety

MSP

BAE

LM Aero

NGC

P&W

Suppliers

LMISCobra

Variety

SAP

BAE

LM Aero

NGC

P&W

Suppliers

LMIS

Excel

Cost

Template

Total program

Cost ScheduleDatabase (CSDB)

Gateway

winsight

CO

STS

CH

ED

UL

E

Integrated ManagementFramework

(IMF)

PV / MSPCV

GE GE

MSP

PV

MPM

CV

MSPPCMS

MS

Pro

ject

17

Weekly EVMS Cycle Flow

Monday

Tuesday

Wednesday

Thursday thru Thurs week

Status Schedule

IPTs Analyze Performance & Address Conflicts

Enter Earned Value into Cost/Schedule System

Complete EV Load, Verify BCWP

Budget/EAC/Revisions as Required

Input Weekly Labor into Cost System

Finalize Cost/Schedule for Weekly Review

Load Data into Cost/Schedule Tool (wInsight)

IPT Reviews & Analyzes Performance

Develops Variance Explanations as Required

Management Review

18

Requirements

Product Data

EVMS

WBS

SOW

IMP/IMS

TPMRisk Mgmt.

,

•Linkages BetweenRelated Data

•Workflow

•ConfigurationManagement

•Traceability

•AccessControls

•Customers

•Suppliers

•Partners

•Program Managers

•IPT Leaders

The Integrated Management Framework will provide Program Management

with A Single Web-Based Portal for Program Data, Status, and Metrics

Integrated Management Framework (IMF)

19

IMP/IMS Integration With Detail Schedules

CS-13

Our Weekly Status Flowed From the IPT Detail Schedules toThe IMS Creates Our Program Critical Path Network and Provides

Management the Visibility to Resolve Potential Impacts

20

Critical Item Network Exists

Management Visibility

Critical Path Status

Critical Path

Activities

Total Number Of Act.

IMP Event Status

Analysis~2500 Activities

Critical Items

CI Network•Provides

Linkages Between Selected Set of Detail Activities Across IPTs

• Resides in CSDB in Project View

•Statused From Detail Schedules Weekly

•Analysis Performed Weekly

•Extracted Periodically for “What If” Scenarios

Detail Schedule for WBS 1122

Detail Schedules•Resources

Identified•EVMS Basis (PMB)•Maintained by IPT

under Config Mgmt Process

•Detail Parts/ Components Statused in MRP

•Currently 25,600 Activities (Over 150,000 at End of SDD)

Weekly Status Flows From IPT Detail Schedules to Critical Item Network Providing Management Visibility To Resolve Potential Impacts

Detail Schedule for WBS 2230

Detail Schedule for WBS 5510

21

Roles & Responsibilities

• Full Responsibility, Authority, & Accountability (RAA)

• Coordination of Detailed Schedules & Budget

• Use Weekly EVMS as a Mgmt. Tool vs. a Reporting Tool

• Lead Weekly EVMS Project Review

• Present Consolidated Weekly Data to Program Management

• Business Management Personnel Assigned to Assist in Support of Weekly EVMS

• Fully Understand Performance Indices

• Status Project Schedules

• Assist in EAC Assessment

• Consolidate Site Inputs for Project Manager

• Facilitate Weekly Project Manager Reviews

IPT Lead Cost/Sched. Integrator (CSI)

22

Program Manager’s Role

• Understands Program Scope/Content

• Ensures Clear RAA Exists for All Tasks – IPT Structure

• Ensures Program Plans are Executable and Satisfy Requirements

• Implements EVM At All Levels of the Team Structure

• Provides a Structured Framework for Performance Status (Weekly Deck Reviews)

• Analyzes EV Data Every Week, Corrective Action Plans– Checks for Poor Performance & Degrading Trends

• Owns Total Program Cost, Schedule & Technical Achievement– Controls Management Reserve (MR)– Manages Baseline Change Control

Lessons Learned

24

Lessons Learned

• Take Time to Plan - Involve ALL Stakeholders– Customers / DCMA / Companies / Suppliers

• Team Leaders Have Responsibility, Accountability, and Authority (RAA) for Cost, Schedule,Technical, and Quality

• Requires Continuous Management Reinforcement

• Requires Shared Single Source Database

• Trained IPT/ Business Management to Support

Program Wide Management Tool vs. Reporting Tool

25

Lessons Learned

• Classroom Training Works - Coaching Delivers

• Start EV Tools at Estimating Phase - Develop into Baseline

• Continual Reinforcement / Discipline– Assumptions can Cause Confusion

• Weekly Communication Build Trust - Intangible Benefits – Don’t Underestimate Non-Verbal Communication

• IPTs Require Different Approaches to Planning

• Recruit Professionals - Migrate Knowledge

• Manage Data Volume - Key Reports (Manage what Matters)

26

Lessons Learned

• Assist Customer Understanding (Help Educate the Customer)

• Sharing Relationship / Develop Partnership with Tool Set Providers

• Don’t Re-Invent The Wheel - Adapt Best Practices, Existing Skills, Process, Tools

• Consolidate / Share Training Costs - Look at Skills Across All Teammate

• Harmonize Training with Tasks

• Consider Long Term Company Strategies

– IT Infrastructure / Tool Set Deployment

CPR

Weekly Deck ChartsExamples

28

Systems Engineering Weekly Earned Value as of 01 Sep 2002

Weekly Deck Format

29

Quick view of summary performance.Quick view of summary performance.Quick view of summary performance.Quick view of summary performance.

‘‘Filters’ Control Rows, ‘Views’ Control ColumnsFilters’ Control Rows, ‘Views’ Control Columns‘‘Filters’ Control Rows, ‘Views’ Control ColumnsFilters’ Control Rows, ‘Views’ Control Columns

30

View Charts and Reports in Dollars, Hours, Eq.View Charts and Reports in Dollars, Hours, Eq.

31

““Indicates that theIndicates that theeffort is on schedule.”effort is on schedule.”““Means that effort isMeans that effort is

costing less that expected.”costing less that expected.”

32

Concluding Remarks

• Weekly EV will Increase the Probability of Meeting Your Customer, Program, and Financial Objectives

• The Biggest Challenge is Changing the Management Culture from Monthly REPORTING to Weekly MANAGEMENT

• Weekly EV Does Not Cost – It Pays!

Adm. Steven L. Enewold: After only 10 months into the program… “we shortstopped two big execution

issues with Weekly EVM…” 9/13/02

33

Conclusion

• Weekly EV Has Provided Value Through the Early Mitigation of Cost, Schedule, and Technical Risk

Higher Probability of Achieving Program Plans

ResultResult

Questions?

35

Good Earned Value for Your Pound!

• 1998 Toyota MR2 GT-TBar (Right Hand Drive)

• 38K Miles…22K Kilometers

• Leather, CD, FSH, TAX

• Immaculate Inside and Out

• £9,000