FEDERAL SECTOR REPORT
July 2006

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Project Management & OMB 300 Success

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(c) 2006 by the P2C2 Group, Inc.

STRONG PROJECT MANAGERS CAN

ACE THE EXHIBIT 300 PROCESS

The Office of Management and Budget (OMB) has good news for experienced project managers. They can succeed in OMB budget reviews by doing what they do best: getting project results.

OMB is making it clear that the focus of agency spending for information technology (IT) should be on results that are achieved through good project management. The new Exhibit 300 defined by OMB Circular A-11, Part 7, is primarily a scorecard for project management and performance results.

The Fiscal Year 2008 Exhibit 300 provides a baseline against which OMB budget examiners can review your progress-annually and even quarterly-regarding:

• Budget, schedule, and EVMS results
• Metrics for mission and program performance
• Acquisition management
• Security and risk management
• Performance of Steady State investments
• Alignment of Enterprise Architecture
• Compliance with various requirements such as privacy and records management

In years past, pages and pages of complex text were required. Agencies experienced limited accountability for the promises and data presented in the Exhibit 300s. Projects with runaway budgets or failed systems drew attention, but merely weak projects muddled along, although sometimes residing in the purgatory of OMB's Watch List. However, as Bob Dylan once sang, "The times they are a-changin." 

Be Prepared

Today and in the years ahead, acceptable IT performance requires year-round project management, and it is no longer possible to ace your agency's IT budget by cramming on Exhibit 300s for a month or two. Next year, you must show a year's worth of progress and results.

All of this sounds like a great opportunity for project managers who are go-getters. Achieving a year (or multiple years) of results requires preparation and execution:

Baseline and Monitor.  Define your performance measures carefully -- and make sure you have all of the baseline data against which to track results.  Determine how you will monitor and manage performance to achieve measurable improvements. Keep records, and document your successes.

Plan and Manage.  Have a plan that spreads the work realistically throughout the year. In addition to project execution, it is crucial to provide ongoing support for compliance issues such as security, privacy, records management, acquisition planning, and Enterprise Architecture (EA) management. The Project Management Book of Knowledge (PMBOK^®) provides concise guidance, particularly when used within the context of your agency's strategic plans and annual performance goals.

Manage EVMS for Success. Favorable EVMS Performance (+/- 10%) requires very sound project planning as reflected in your scope, Work Breakdown Structure, schedule, and accuracy of your cost estimates. Every month -- or more often -- monitor deviations and take immediate, aggressive corrective action. Project budgets and schedules get out of control quickly, and you must be an activist manager to achieve your EVMS numbers.

Acquisitions.  Get smart with your acquisitions. Project scopes and functional performance objectives have to be crystal clear so that a capable contractor can achieve milestones within schedule and costs. Take corrective action immediately if cost or schedule variance is unacceptable.

Knowledge Management.  Project records and documentation are increasingly important.  Professional project management is in, and "seat of the pants" managers will be out. Structured information enables intelligent management, reduces risk, enables project continuity, and provides the framework for continuous review and improvement.

Integrated Project Reviews.  At minimum there should be quarterly reviews to assess the overall health of the project. This should encompass the works:  mission-related performance, EVMS results, risks, security, compliance issues, technical performance, innovation, and quality. It should also include an assessment of whether the project is on track to fare well in next year's Exhibit 300. Since the world is seldom utopian, reviews will usually identify the need for corrective actions, which of course are useless except when acted upon.

Operational Analysis Reviews. Operational Analysis has traditionally been the boring country cousin of the investment management process, relegated to a role in Steady State projects. But take a fresh look: These reviews get at the quality and mission performance issues that are not even addressed by Earned Value Data, and the long-term value of IT of operational systems rides heavily on the back of operational analysis. What's more, a large share of Federal IT spending is for Steady State investments, and you can't get control of overall costs until you get a handle on your in-place operational systems. (According to March 2005 data from OMB, the President's proposed budget for Fiscal Year 2006 included $42.4 billion for Steady State spending out of a total of $63.5 billion for IT.)

Food for Thought

Most agencies spend over half of their IT money on Steady State investments.  There should be assessments of whether any legacy IT assets can be retired, terminated, or merged. That is one of the burning, underlying questions driving Enterprise Architecture.

Consider freeing up dollars for urgently needed improvements, even if your IT budget is strained. There is a trend toward reducing acquisition costs, at least in the private sector (CIO magazine, July 1, 2006; Trimming for Dollars, page 34). Cutting the 10% least productive costs could be redirected to improvements that leverage results and stakeholder satisfaction.

SERVICES

The P2C2 Group helps agencies transform IT compliance activities into results that leverage mission and programs in measurable ways. This includes IT strategic planning, CPIC, EVMS, FISMA, the FEA, and analyzing performance. Our firm specializes in capital programming, which integrates the planning, acquisition, project management, and operational control of capital assets. Our consulting services assist agencies in improving asset management, mission results, and compliance with regulatory requirements.

Professionals in the P2C2 Group's consulting practice are highly experienced, have proven performance records in multiple agencies of the United States government, and are dedicated to implementing best practices.

HOME PAGE

Information technology is enabling self-service solutions to improve citizen service and reduce agency costs. Currently I am participating on a panel of judges who are reviewing outstanding achievements in using kiosks for self service. I am a non-paid volunteer, but the benefit for me is that I have an opportunity to survey world-wide innovations in kiosk and self-service solutions.

Elena and I, along with our dogs, had a refreshing 4th of July weekend at a cabin near Front Royal. We enjoyed hiking in the woods and Skyline Drive. There was a phenomenal hot tub at the cabin. No, the dogs didn't jump in the hot tub.

Best wishes,

Jim Kendrick

Certified Management Consultant

P2C2 Group, Inc.

4101 Denfeld Avenue

Kensington, MD 20895

kendrick@p2c2group.com

301-942-7985

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