Earlier this year, the NDIA (National Defense Industry Association) released the Earned Value Management Scalability Guide. The NDIA IPMD Civilian Agency Industry Working Group (CAIWG) created this guide to help civilian government agencies and their suppliers implement EVM on smaller programs.
The US government contractual mandates the use of Earned Value Management Systems (EVMS) on large development and production projects. So, there is a considerable amount of information and guidance available on how to implement the EVMS standard. One problem is, that there is little support for scaling EVMS down to smaller programs where a fully verified EVMS is not a contractual requirement.
Enter the NDIA’s Earned Value Management Scalability Guide. This guides reflects the size, complexity, risk, and type of work and applies the 32 guidelines in a way that is much more pragmatic.
It applies basic EVMS principles which take into account the level of detail and project control discipline appropriate for the project or program. It is a useful starting point for organizations that may well end up with larger programs with more complexity and require formally accepted EVMS compliance adhering to all 32 guidelines.
In short, organizations with smaller programs are able to realize the benefits of an EVMS. These organizations could include:
- Companies with small projects or that issue contracts to small businesses, suppliers, and vendors
- Any government agency with small contracts
- Universities and laboratories
- Companies with projects that are growing closer to the threshold that requires formal EVM compliance
It is worth noting that the definition of a small project may differ across industries and government agencies.
The Earned Value Management Scalability Guide
The Earned Value Management Scalability Guide is organized into the following nine project management processes:
- Organizing for Project Management
- Establishing and Maintaining an Integrated Project Schedule
- Defining Budgets and Authorizing Work
- Interfacing the EVMS with the Accounting System (actual costs)
- Managing using Project Performance Information
- Incorporating Approved Changes into the Project
- Managing Project Material Items
- Managing Subcontracted Work Effort
- Managing Indirect Budgets and Costs
Typically, processes 1 to 6 are the steps followed to establish a new project and to execute the planned work effort. The remaining processes, may not apply to all projects and therefore may not be relevant.
The Earned Value Management Scalability Guide includes sections for each process as well as the related sub processes. These include:
- A reference to the applicable EVMS Standard primary guideline and secondary guidelines The secondary guideline references are meant to highlight the interrelationships between the primary guideline’s scaled implementation and the scaled implementation of the secondary guidelines
- A description of the process and its underlying connection to project management
- The benefits to be derived from effective implementation
- Approaches for scaling the implementation of the process
- Descriptions of typical products produced
- Reference to best practice comments from the GAO Cost Estimating and Assessment Guide or Schedule Assessment Guide, where applicable
If the projects and programs your organization delivers ultimately are US government contracts, then EVMS should be on your radar. Even if EVMS is not yet a contractual requirement, there is an inevitability that it will become so as your organization grows in this market space. If this is the case, then starting small now and using the Earned Value Management Scalability Guide is a great way to introduce best practices and get on the right path.