Presented to: NDIA By: Keith Kratzert Date: August 16, 2006 Federal Aviation Administration Improving Program Performance at FAA

2 Federal Aviation Administration Improving Program Performance at FAA August 16, EVM at FAA FAA EVM Policy and guide established August 2005 (modified in January 2006) FAA goal is to manage entire program using EVMS in accordance with ANSI/EIA 748 –Manage/measure all resources –Requires changes in behavior by all parties FAA EVM differs from legacy approach –Program level, not just contractors –Will not change existing contracts

3 Federal Aviation Administration Improving Program Performance at FAA August 16, FAST Home Page:

4 Federal Aviation Administration Improving Program Performance at FAA August 16, EVM Transformation Overview “Flag”

5 Federal Aviation Administration Improving Program Performance at FAA August 16, EVM Council Formed as a continuation of the program management processes effort Co-Chaired by ATO-A and AIO Membership includes: –ATO Service Unit representatives –Non-ATO Lines of Business implementing EVM –AIO representatives –CFO representatives

6 Federal Aviation Administration Improving Program Performance at FAA August 16, EVM Transformation – Goals for 2006 EVM Council tracking POA&M status – most targets due in 2006 – if achieved, flag will turn to mostly yellow and green. FAA to assess its financial processes against the ANSI standard & update its flag FAA to issue a Layperson’s guide to EVM FAA to issue a manager’s guide to using EVM Technical Training to continue and will be supplemented by executive awareness training EVM toolkit study

7 Federal Aviation Administration Improving Program Performance at FAA August 16, EVM Transformation – Goals for 2007 Full EVM implementation by end of FY 07. EVM part of Program Managers toolkit. Full EVM reporting for all major investments. EVM scores on Exhibit 300s are all “4” or “5”. Use of EVM makes a major difference in ability of FAA programs to stay on track and within budget. Use of EVM contributes to FAA “NAS Modernization Program” being removed from the GAO High Risk List.

8 Federal Aviation Administration Improving Program Performance at FAA August 16, FAA Contractor Meeting Follow-up Participants –Lockheed Martin* –Raytheon* –Harris* –Parsons Infrastructure and Technology Group* –Northrop Grumman* –Mitre –Computer Sciences Corporation* –BAE Systems* * Follow-up meeting already held

9 Federal Aviation Administration Improving Program Performance at FAA August 16, Follow-up Meeting Guidelines Attendees requested to return for individual meetings over next three months with EVM team and selected Program Managers and Contracting Officers –Present Management Overview Company response to FAA initiative EVM System acceptance applicability to FAA or Plan to achieve acceptance (ref. NDIA Systems Acceptance Guide) How EVM is used on current FAA contracts Best practices (e.g., subcontract management) Improvement opportunities

10 Federal Aviation Administration Improving Program Performance at FAA August 16, Current Review FAA Acquisition Management System Policy being reviewed with recommendations being made to incorporate: –Baseline management guidance –OMB Exhibit 300 reporting Exhibit 300 format used to report monthly program performance –July 2006 EVM FAR clause intent –Contractor EVM “Best Practices”

11 Federal Aviation Administration Improving Program Performance at FAA August 16, Pending Recommendations Align FAA baseline management policy with OMB direction and current FAA practices for incremental program approval Establish planning, performance reporting, and OMB Exhibit 300 requirements for Standard Program Milestones Integrate schedule and cost reserve management Expand program acquisition plan to include Establish consistent Agency EVM policy for Prime contractors, subcontractors, and support contractors

12 Federal Aviation Administration Improving Program Performance at FAA August 16, Future Plans FAA major contractor meeting Sept 14, 2006 Proposed policy changes reviewed and approved Proposed EVM certification, surveillance, IBR, and executive program performance reporting processes will be developed and implemented –Based on NDIA guidelines –major contractor “Best Practices”