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  • Question

    How can unnecessary/non-informational variance reports be prevented when an LOE budget period requires zero actual work?


    Answer

    In EVM, undefined but scoped work is held in Summary Level Planning Packages until it is detailed planned.  As the time for the work moves closer, the work is decomposed, planned in detail and transferred into Control Accounts. Usually detailed work is not planned for more than 6 months into the future, but it could be a shorter time period. Possibly, only the 35% of the work should be executed using EVM, again whether or not the use of EVM is appropriate would be chiefly driven by the nature of the work, contract type and contract value.
     
    The author states "Still, not knowing the nature, cause and timing of the work in advance of each "rolling wave" period leaves 65% of the contract LOE".  If work is able to be defined to this granularity, then it appears to me EVM would be the ideal tool to properly manage the work and should not be categorized as LOE.  My comment is further supported by the author's statement of " Once the unplannable work is identified, much of it can run beyond a single accounting period, has definite entry and exit criteria and an identifiable output can be determined." This rolling wave planning is a fundamental tenet of EVM (which is actually just solid program management where work is planned and then executed to the plan).  The work is transferred from a Summary Level Planning Package to a Control Account through a Work Authorization Document and statused for BCWP and ACWP as it moves forward (BCWS, the BAC and PMB were already establsihed) and the results are analyzed to determine program health. 
     
    In his question "How can unnecessary/non-informational variance reports be prevented when a LOE budget period requires zero actual work?", if the author is suggesting, using EVM, LOE work was planned but not executed, then I would ask under whose authority was the work authorized to start before it was ready to proceed? Meaning, why was a Work Authorization Document issued for work prior to it being encumbered?  Therefore, if the LOE CA was un-encumbered (thus no work has started), then the BCWS should have be re-planned to a future date and shifted to the right on the IMS.  Otherwise, CV will be positive (and worse yet, masking negative CV) since because in LOE BCWP will be taken equal to BCWS simply because of passage of time, not due to any work being accomplished.  The big problem with this non-ANSI-748 compliant practice is the budget for the work has now been expended, but in reality, no work was accomplished.  What is the project going to do at the tail-end of this control account, where there is no more budget, but work still needs to be performed without authorized budget or sufficient period of performance?  

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