Overview
- Magnitude of subcontract dollars.
- Risk factors in subcontracting.
- Problems inherent with subcontract control.
- Performance measurement – the benefits.
Introduction to the Earned Value Concept
- Problems with comparing plan versus actual to ascertain performance.
- Earned Value – An essential parameter.
- The Brick Wall – An illustrative example of Earned Value methods.
Earned Value Management Systems Flowdown
- Establishing flowdown requirements.
- Flowdown of Earned Value Management Systems Guidelines (EVMSG).
- Flowdown of modified EVMSG.
- Tailoring flowdown requirements.
- Evaluating subcontractor's proposal response.
- Sample System Implementation Plan.
Flowdown Requirements Case Study #1
An exercise to determine which requirements to flow down from prime contractor to appropriate subcontractors.
Organization
- The Work Breakdown Structure (WBS).
- Integrating subcontracted effort into the prime contract WBS.
- The subcontract management team.
- Control Accounts for subcontracted effort.
- Work Authorization for subcontracted effort.
Subcontract Planning
- Establishing the Baseline – A three-stage iterative process.
- Scheduling subcontract effort – The importance of prime and subcontract schedule integration.
- Budget planning for subcontractor effort.
- Planning subcontractor fee in prime Control Accounts.
- Prime contractor planning of subcontracts without EVMSG requirements.
- Establishment of Budgeted Cost for Work Scheduled (BCWS) for the different contract types.
Control Account Planning Case Study #2 (CPR) and #3 (FFP)
A detailed exercise in Control Account planning which involves using subcontractor source data to plan prime's subcontract Control Accounts. Several planning techniques will be reviewed and used for planning.
Baseline Maintenance
- How the prime contractor handles change to the subcontract baseline.
- How different types of changes affect baseline maintenance.
- Challenges to the Prime and the Subcontractor's baseline management.
Determining Earned Value for Subcontract Control Accounts
- Methods used for subcontracts with Contract Performance Report (CPR) and/or the Integrated Program Management Report (IPMR).
- Methods used for subcontracts without CPR and/or IPMR.
Earned Value – Case Study #4 and #5
Two detailed exercises in Earned Value determination using the solutions from case studies #2 and #3.
Accounting Considerations
- Cost segregation requirements.
- Linking prime contractor cost accumulation systems.
- Accumulating Actual Cost of Work Performed (ACWP) into the Earned Value Management System.
- Subcontractor's material performance measurement.
Analysis of Subcontractor Performance Data
- Determining cost variances, schedule variances and variances at completion.
- Determining how significant variances affect subcontract performance measurement.
- Typical variance analysis thresholds at the prime Control Account level.
- Prime contractor's variance analysis process.
- Estimates-At-Completion (EACs).
- Validating the subcontractor's EAC.
- Using performance indices and trend analysis.