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Capital Planning and Earned Value Implementation for the Department of State’s Global Network PMI Knowledge Exchange Forum October 26, 2004 Presented by.

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Presentation on theme: "Capital Planning and Earned Value Implementation for the Department of State’s Global Network PMI Knowledge Exchange Forum October 26, 2004 Presented by."— Presentation transcript:

1 Capital Planning and Earned Value Implementation for the Department of State’s Global Network PMI Knowledge Exchange Forum October 26, 2004 Presented by Bob Horrigan, PMP

2 Session Talking Points zPresident’s Management Agenda zGlobal Network Capital Asset Plan and Business Case zThe Roadmap zPerformance Goals and Measures zAcquisition Strategy zProject Investment and Funding Plan zPerformance Based Measurement zArchitecture and Security

3 Brief History: Where We’ve Come From z1997Clinger-Cohen Act: Added diligence in IT investment management z1998OMB Directive 300: All agencies must implement IT investment planning for capital programs z2001 State Department: Implements Federal Information Technology Investment Portfolio System (I-TIPS) z2002OMB Institutes Scoring for OMB 300 Requirements, DoS Receives Red Score, CIO Leads Charge to Improve z2003All Projects Must Conform to OMB Requirements – Security, Management Controls (earned value), Risk Management, Alternatives Analysis, Conformance to Enterprise Architecture

4 Three “legs” of Clinger-Cohen zSelect – Screen/Rank/Select yIs this the best choice to achieve the desired result? zControl – Monitor Progress/Take Corrective Action yIs the project meeting schedule and milestone targets? yShould the project methodology be changed to adjust for emerging factors? zEvaluate – Conduct Reviews/Make Adjustments/ Apply Lessons Learned yIs the project meeting its intended goal? yWhat was learned that could inform future actions?

5 Agency Guidance Define Technical Alternatives -- Status Quo -- Process/Organization projects -- Security projects -- Technical/System/IT -- Outsourcing Benefit/Cost Assessment -- $ Benefits and Costs -- Business Benefits -- CFO/Budget Spreadsheet -- Risks Business Line & IS Inputs Modernization Blueprint (EA) Strategic Plan Define Acquisition & Program Management Plans Refine Selected Alternative CCA and FASA OMB A-11 and A-130 IT Investment Guidance 4 Define Strategic Business Needs/Value Capture -- Derived from Strategic Plan Performance metrics and/or Cost Savings -- Enterprise Architecture 4 Define Customer Needs 4 Define Critical Success Factors 4 Gap analysis (process, organization, IT Capability) Clinger-Cohen Act: IT investments are to be defined, selected, and managed on the basis of a well-founded Business Case SEC CAPITAL PLANNING AND INVESTMENT CONTROL. implement in the agency a process for maximizing the value and assessing and managing the risks of the information technology acquisitions Risk ID, Assessment, & Define Management Plan Business Case (OMB A )

6 President’s Management Agenda (PMA) zThe Problem (from PMA) — The federal government is the world ’s largest single consumer of information technology (IT). IT has contributed 40 percent of the increase in private-sector productivity growth, but the $45 billion the U.S. government spent on IT in 2002 has not produced measurable gains in public-sector worker productivity. zOMB’s Task — To improve use and management of IT resources in all agencies to achieve the greatest gain for U.S. taxpayer dollars through appropriate IT Capital Planning. zState’s Task — Move from “yellow” to “green” on the PMA scorecard with regard to IT Capital Planning. The Exhibit 300 is the tool that OMB uses to measure our progress.

7 Global Network Overview zMajor, consolidated IT investment called Global Network ($1B over 10 years) includes 8 subprojects: yBandwidth Management yEnterprise Network Management yEnterprise Software Licensing and Maintenance yAlternate Communications Site yInfoCenter Service Support Desk yIn-Line Network Encryption (Type 1) yOpenNet Everywhere yExchange engineering

8 The Roadmap z Performance Goals and Measures z Project Management Team and Qualifications z Alternatives Analysis z Cost Benefit Analysis z Risk Inventory and Assessment z Acquisition Strategy The OMB 300 lays out the plan for IT management. It includes:

9 The Roadmap (cont’d) zFunding Plan yEarned Value Statistics and Variance Explanations yCorrective Action Plans yAgency Head Concurrence if variance is greater than 10% zEnterprise Architecture Alignment yPerformance Reference Model yService Reference Model yTechnical Reference Model zSecurity and Privacy

10 Performance Goals and Measures zFour measures following the Performance Reference Model yBandwidth Cost Improvement yEnterprise Standardization Improvement ySecurity Improvement thru patch management and monitoring tools yNetwork Availability zThese measures are also mapped to the support contractor’s performance-based contract yENM Project Performance Metrics

11 Acquisition Strategy z Performance Based Contracts y Enterprise Network Management Support – Cost Plus Award Fee y Bandwidth – FFP y Enterprise Licensing – FFP z Acquisition Plans developed for all three y Formal MOU signed between DoS CIO and AID CIO z Collaboration with US AID and GSA SmartBuy highlighted

12 Project Investment and Funding Plan z Performance-Based Management System in place following ANSI/EIA Standard 748- A. z Cost baseline identified from 10/1/05 – 9/30/14 y Earned Value Measurement System in place y Reporting required monthly to eGov Program Board

13 ENM’s Performance Based Measurement z Required by OMB and Contract z Generates metrics for cost and schedule performance z Based on an internal, automated timekeeping system, Microframe Project Manager (MPM), NGIT System Description, ANSI/EIA 748, Work Breakdown Structure, Billet Assignment System, Board Action Requests z Must have scope management discipline to succeed

14 Cost Control thru Earned Value - What is It? zBaseline Management yA well defined plan before work begins yA clearly identified performing manager for each project yA clearly authorized scope, budget and scheduled time frame to the performing manager zEarly Visibility to Variance yQuick decisive plan to correct and/or pose alternatives yManagement notification and concurrence zPossible Trade-Offs ySchedule vs. Costs yGreater customer involvement yCancel Project/Cut Losses

15 PDCA Cycle with EVA Plan Do Check Act Reports Change Control Process General Ledger $$ Time Cards Expenses Hours Task Completion Reports Variance Action Plans WBS OBS Resources Schedule Cost Accts Time Phased Budget Project SOW BOE

16 Summary zProject success dependent on adhering to stringent controls required by OMB yPerformance Goals yCost and schedule controls yPerformance based contracting requirements yAdherence to security requirements and reporting zLong term planning and marketing required for future funding of new initiatives


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