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  • 1. Program and Project ManagementPolicy Development Overview and Rationale Sandra Smalley Office of the Chief EngineerUsed with permissionPage 1

2. Objectives of SessionProvide: A high-level overview of recent policydevelopments An understanding of the purpose ofthe selected developments A preview of some upcoming policydevelopments Page 2 3. Recent Policy DevelopmentsOverview Page 3 4. Policy Developments 2007 NPR 7120.5 D - NASA Space FlightProgram and Project ManagementRequirementsThis revision of NPR 7120.5 is part of arealignment of governing documents withinNASA designed to increase accountability andgeneral clarity in the flow-down of managementprocess requirements. NPR 7123.1A - NASA Systems EngineeringProcesses and Requirements Page 4 5. Policy Developments 2008 NPD 1000.0A - Governance and StrategicManagement NPR 7120.7 - NASA Information Technologyand Institutional Infrastructure Program andProject Management Requirements NPR 7120.8 - NASA Research andTechnology Program and ProjectManagement Requirements NPR 8000.4 - Agency Risk ManagementProcedural Requirements Page 5 6. Policy Developments 2009 NPD 1000.5 - Policy for NASA Acquisition NPR 7120.5D - NID NPD 7120.4 - Program/ProjectManagement Page 6 7. Policy Development Other Supporting WorkHandbook development The SRB Handbook The Risk Management Handbook NPR 7120.5 Handbook WBS Handbook Cost Estimating Handbook Schedule Management Handbook Page 7 8. Policy Development Why all the activity? Improve program/project performanceagainst external commitments (real andperceived) More effectively support programs andprojects by improving and tailoring policy,processes, and requirements Recognize the multi-center environment in manyprograms and projects. This includes giving moreattention to common principles, terminology, andpractices while recognizing the differences thatexist in Center processes and historic practices.Page 8 9. Improving Agency Performance Approach Employ a sound approach to Acquisition NPD 1000.5 Ensure early and continuing alignment of programproject planning and budget process Strategic planning meetings NPR 7120.5D NID PPBE process with annual portfolio review Establish the proper set of requirements Establish a life cycle process that keeps theprogram/project on trackPage 9 10. Selected Policy Developments Acquisition Establishing the proper set of requirements Space Flight and ITBaseline PolicyJoint Confidence Level (JCL) Policy Preview of NPR 7120.5 Rev EPage 10 11. Selected Policy DevelopmentsAcquisition Definition (NPD 1000.5)Acquisition is the process for obtaining thesystems, service, construction, andsupplies the Agency needs to fulfill itsmission.Acquisition, which may include procurement(contracting for products and services), beginswith an idea or proposal that aligns with the NASAStrategic Plan and fulfills an identified need andends with the completion of the program or projector the final disposition of the product or service.Page 11 12. Selected Acquisition Policy(NPD 1000.5) Meet programmatic, institutional, technical, cost, andschedule commitments Base acquisition on realistic cost estimates andachievable schedules For space flight and IT, Agency commitments are to bebased on the budgeted cost and schedule associatedwith the confidence level approved by the decisionauthority. Programs and projects are to be annually reviewed bythe responsible Mission Directorate or Mission SupportOffice to confirm to the decision authority that theircurrent baseline life cycle cost estimates, fundingstrategy, and the annual NASA budget submissions areconsistent. Page 12 13. Selected Policy Developments Acquisition Establishing the proper set of requirements Space Flight and ITBaseline PolicyJoint Confidence Level (JCL) Policy Preview of NPR 7120.5 Rev EPage 13 14. Establishing the proper set of requirements Good requirements that are properlymanaged are essential to any successfulundertaking. 7120 Series NPRs focus programmanagement requirements on specificproduct lines. Tailoring Principles provide a means toadjust prescribed requirements to a specifictask (e.g., a program/project). Page 14 15. Tailoring - DefinitionTailoring - the process used to adjust or seekrelief from a prescribed requirement toaccommodate the needs of a specific task oractivity (e.g., program/project)The Tailoring process results in the generationof Deviations and Waivers depending on thetiming of the request.Page 15 16. Tailoring Principles The organization at the level that establishedthe requirement approves the request fortailoring of that requirement unless thisauthority has been formally delegatedelsewhere. The involved management at the next higherlevel is informed in a timely manner of therequest for tailoring of a prescribedrequirement. Page 16 17. Policy Selected Developments Acquisition Establishing the proper set of requirements Space Flight and ITBaseline PolicyJoint Confidence Level (JCL) Policy Preview of NPR 7120.5 Rev EPage 17 18. Space Flight and IT Baseline and JCL Perspective SMC baseline and JCL policy discussionsdate back several years. The concept and details continue to evolve. A number of changes and implementationdetails are being considered for NPR 7120.5Rev. E.Page 18 19. Baseline PolicyGoalImprove the cost and scheduleperformance of programs and projectsby improved planning based on theintegration of cost, schedule, and riskPage 19 20. Joint Cost and Schedule Confidence LevelDefinition (Simplified)The probability that cost will be equal toor less than the targeted cost and theschedule will be equal to or less thanthe targeted schedule date. Page 20 21. Joint Bivariate Cumulative Probability Distribution of Cost andSchedule ProbabilitySchedule (y)(Months)Cost (x) ($M)21 Page 21 22. Current Policy Policy applies to Space Flight and IT programs andprojects in implementation. Programs/projects are to be baselined orrebaselined based on a joint cost and scheduleprobabilistic analysis. Programs - Baselined or rebaselined at aconfidence level of 70 percent or the level approvedby the decision authority Projects are to be baselined or rebaselined at aconfidence level consistent with the programs JCL. Projects - As a minimum, funded at a level that isequivalent to a confidence level of 50 percent or asapproved by the decision authority Page 22 23. Current Policy (Cont.) Programs in extended operations generallyare not required to develop a JCL, but newor upgraded capabilities while in ops willrequire a JCL. Program and project proposed cost andschedule baselines will be assessed by anindependent review team. External commitments will be based on theJCL approved by the decision authority. Page 23 24. Baseline Policy Commitment Baseline Basis forcommitments to OMB and Congress Management Baseline Basis forprogram/project execution and strategicmanagement process reportingPage 24 25. Commitment Baseline Key Attributes It is an integrated set of project requirements,cost, schedule, technical content, and agreedto JCL that forms the basis for NASAscommitment to OMB and Congress. It is established at the Key Decision Point(KDP) that initiates the ImplementationPhase. The Commitment Baseline is the only officialNASA baseline for a project. Page 25 26. Unallocated Future Expenses (UFEs) Needed to understand Management BaselineUnallocated Future Expenses -The portion of estimated cost required to meetspecified JCL that cannot yet be allocated tothe specific project WBS sub-elements becausethe estimate includes probabilistic risks andspecific needs that are not known until theserisks are realized.Page 26 27. Unallocated Future Expenses (UFEs)(Cont.) The term UFE was established to make it clearthat (based on experience) these funds areexpected to be required to complete the projectbut cannot yet be allocated to a specific WBSactivity. (The UFE concept is consistent with the non-deterministic nature of joint cost and schedule estimates based on probabilistic analysis.) All UFE are included in the commitmentbaseline and the projects budget.NOTE The relationship of UFE to Commitment and ManagementBaselines is illustrated in an upcoming slide. Page 27 28. Management Baseline - Key Attributes An integrated baseline (set of requirements,cost, schedule, technical content, andassociated JCL) that forms the foundation forprogram/project execution The Management Baseline is established atthe Key Decision Point (KDP) that initiates theImplementation Phase as approved by thedecision authority.Page 28 29. Management BaselineKey Attributes (cont.) The program Management Baseline is theaggregate of the project CommitmentBaselines plus program operating expenses. Similarly, the project Management Baseline equals the Commitment Baseline less any portion of UFE not released to the project for project execution.Page 29 30. Relationship of UFE to Project Commitment and Management BaselinesThis UFE iscontrolled byProject Commitment Baseline UFEthe(External commitments)Program/MDProject Management Baseline (Project Execution)ProjectManagerControlNot to scale.Page 30 31. Program and Project Baselines ProgramTotal Baseline Cost OperatingExpenseProgram Management BaselineProject Management BaselineUFE Held by Project 2 Project Commitment Baseline UFE Held by ProgramProject -2 UFE Held by Project 1UFE Held by Project 1UFE Held by Project 2 Project -1 Project -1Project -2ProgramPage 31 32. Selected Policy Developments Acquisition Establishing the proper set of requirements Space Flight and IT Baseline Policy Joint Confidence Level (JCL) Policy Preview of NPR 7120.5 Rev EThe Rev E development is in its early stages.This preview should be viewed as both notional and pre-decisional. Page 32 33. Rev. E Development Charter Build on the NID Issue Rev. E before the expiration of the NID Fully vet and resolve policy issues raised but notresolved during the