There was a question posed on LinkedIn
How do you get Project Manager understand the importance of Earned Value Management?
It's been shown over and again when we make EV a compliance process and hold managers accountable for compliance it is a necessary condition for success, but far from sufficient.
Until EVM starts providing actionable information to the program management staff in the form of "leading indicators" it will always be one of those compliance processes. This information must reveal where in the program, technical and programmatic changes can be made, the testable outcomes of those changes on program performance, and the impacts on cost and schedule forecasts and the EAC against the BAC. Starting at the program level, but going down to the Control Account and Work Package.
In other words...
Nice data there in your Formats 1-5 and really nice IMS, what should I do next?
EV numbers themselves are lagging indicators, non-statistically adjusted, non risk adjusted, not connected to the effectiveness and performance measures of the project - unless enlightened users do so - and not connected to the needed capabilities of the customer as delivered by the program. There is no DID for the IMP, so Systems Engineering rarely flows down MOEs and MOPs - except where they do, because of the knowledge of the power of this approach.
Next is a real problem. 748-C has a loop hole big enough to fly a 787 through. In section 3.8 "Earned value is a direct measurement of the quantity of work accomplished. The quality and technical content of work performed is controlled by other processes." Measuring quantity is a construction centric view of producing value. Not a value centric view. Our defense, space, biopharma, software intensive programs that apply EVM are not pouring concrete or welding pipe. (I used to work in that domain as a SW developers on piping design systems). If we see EV as measuring quantity we ignore all the concerns Paul Solomon has brought forward, starting with the missing Technical Performance Measures for the product.
Sure we have exit criteria for the Work Packages. But these need to trace vertically through the IMP to the Capability to accomplish the mission or provide a solution to the business need. In other do something with the resulting product or service. It has to be the right thing of course. But EV - as stated in 748 - only measures to quantity of parts needed to delivery a capability, not the ability of the system to fulfill the needed capabilities. This by the way is essentially a Systems Engineering issue. With the missing IMP, most of the motivation for connecting the dots between EV and mission success is simply not there. It's back to the immutable principle
We don't know what done looks like in units of measure meaningful to the decision makers
"Earning value" means assessing the efficacy of the BCWS. This means assessing the Technical Performance Measures of the work be delivered. Many implementations assign TPMs and QBD's this work. But this is not called out in 748-C nor any formal EV guidance. It is called out in the DAG and the old SEMP DID. No SEMP DID is in place.
So as EV practitioners we need to make the business case of EVM, not just the compliance case. When we add "leading indicators" that are statistically sound (Eric Druker has written about this as have others, including me), forecasting of EAC based on ARIMA processes rather than our linear, non-statistical, non risk adjusted CPI/SPI measures. As well those measure "roll up" the variances of all the past time series data, just like Darrell Huff tells us to do in "How To Lie With Statistics".
All the data is available in the EV engine and in the CR at PARCA for DOD jobs. What's next is to start using EVM in the same way supply chain managers, quality control managers, systems engineers, and every design and manufacturing engineer does - compare statistically adjusted performance against the probabilistic plan to see leading indicators emerge of where we are going to go into the ditch in the future, show the PM, that corrective action "before the fact" rather than after.
This will be a topic discussed at EVM World and ISCEA conferences coming soon.
