Keeping Squirrels Out of the Attic: Baseline Management

Imagine you need a new roof on your house but the contractor is squeezing you in between other projects, doesn’t have the proper materials or enough labor, and then leaves to complete another job before coming back to yours. Meanwhile the hole in your roof has let in rain, leaves, and maybe even a few critters, all of which have caused more damage. Housing projects can spiral out of control fast and without a solid plan from the beginning, you could have squirrels in your attic year round.

The same goes for federal IT projects. Federal government IT investment oversight is increasingly focused on baseline management for good reason. Effective baseline management allows the project manager (PM) to achieve the intended business outcome in a cost-effective way, on time, and within budget. It also provides early warning of increasing variances from planned cost or schedule, thus giving the PM a chance to identify and address any red flags.

When baseline management is ineffective, however, IT projects can easily go off the rails because there is no useful “blueprint” for achieving the intended outcome, no accurate measurement of cost and schedule performance, no early warning of problems, and no opportunity to resolve problems while they are still fixable. The results can include increased IT investment costs, schedule delay, “scope creep,” and failure to achieve the intended outcome.

Federal IT capital planning efforts increasingly focus on supporting, guiding, evaluating, and improving IT baseline management processes because of how critical they are to IT project success. The Office of Management and Budget (OMB) memorandum M-10-27 requires all Federal agencies to implement IT baseline management policies, processes, and training. Investments that do not remain within +/- 90% of planned cost an schedule are subject to increased scrutiny from oversight entities as well as possible suspension or termination.

Establishing the Baseline

The first significant step is creating a sound, accurate, and comprehensive baseline. This is the foundation for effective baseline management over the life cycle of the project. Here are five IT capital planning strategies for working with PMs and Integrated Project Teams to ensure this happens.

1. Document Requirements

Clearly describe the two sets of requirements that must be met in establishing a baseline:

The activities and analyses that must be performed to identify all of the content of the baseline (see the Tracker for Establishing a Baseline, below).
The criteria against which data in the proposed baseline will be evaluated (see the Requirements for Baseline Data, below).

PMs and investment teams must understand both sets of requirements. Specific documented requirements and frequent meetings between the PM, investment team, and the IT Capital Planning team within the Office of the Chief Information Officer (OCIO) ensure everyone understands the requirements for establishing a baseline, available resources, evaluation criteria, and appropriate sequencing of planning activities.

2. Provide Resources

Training sessions, templates, guides, and tools will (1) help PMs and investment teams comply with requirements and (2) provide standardized processes across the enterprise. For example, simply requiring an Integrated Baseline Review (IBR) is not as useful as providing an IBR training session, an IBR Guide, and an IBR Summary Report template. A departmental IT Cost Estimation Guide provides a useful, standardized structure and process for estimating, improving, and validating planned costs for an IT investment.

3. Track Progress

The tracker (below) is a useful tool for summarizing requirements and tracking progress when establishing the baseline.

Tracker for Establishing a Baseline

4. Evaluate Deliverables via Scorecards

The OCIO evaluates the PM’s deliverables, prepares the scorecards, and then provides the scorecards to the PM, sponsor, program manager, and other key stakeholders. First and second scorecards can:

Ensure the baseline requirements are met
Support a standardized process across the enterprise
Promote the establishment of a sound, comprehensive baseline that will be useful in managing a successful project
Identify artifacts or analyses that require additional effort
Engage sponsors, PMs, and others by providing visibility into the process
Prevent expending resources on projects that have not been properly planned

First Scorecard

The first scorecard measures the quality of the initial requirements analysis, the evaluation of cloud solutions, the cost benefit analysis, the acquisition plan, the performance goals, and the initial draft of the baseline. This first scorecard provides an opportunity to identify and address problems before expending further resources. For example if a technical architecture schematic cannot be produced, it is premature to develop the baseline. Likewise if useful performance goals and target metrics cannot be identified, the scope and purpose of the investment are not adequately understood. This scorecard process stops the organization from spending additional resources before the necessary planning has been accomplished.

Second Scorecard

The second scorecard focuses on the IBR Summary Report, the IT Cost Estimation Summary Report, the Earned Value Management (EVM) Assessment, and the proposed baseline. The results of the IBR should strengthen the draft baseline and reflect stakeholder consensus on activities, cost, schedule, risk management, and other elements of the baseline. The results of the cost estimation process should further refine and validate planned costs in the draft baseline and show sponsor approval of the final planned costs. The EVM Assessment shows that the person who will be handling EVM reporting for the investment understands basic EVM concepts. The proposed baseline represents an improved version of the draft baseline.

5. Incorporate Lessons Learned

The process and requirements for establishing a baseline can be improved by analyzing IT acquisition problems. For example, if IT security configuration issues halt a system development effort, it suggests that technical requirements were not adequately analyzed or understood in the beginning. How can the process and requirements for establishing a baseline be modified to incorporate more robust requirements analysis? If actual costs increase significantly, how can the process of estimating planned costs be strengthened? Baseline management oversight can and should be improved on an ongoing basis by examining what works well, what doesn’t work so well, and what process improvements can be made.

So the next time your roof needs to be replaced, don’t rush into it without getting a solid idea of what it will cost, how much time it will take, and what the exact outcome will be. Otherwise you may have some wet furniture and furry roommates in the very near future.


Sunday, January, 1, 2012
Keeping Squirrels Out of the Attic: Baseline Management
Tags: Innovations, Baseline Management, Project Management


Posted By Carol Vernon, IT Capital Planning Program Manager at the Department of Labor (DOL)
Imagine you need a new roof on your house but the contractor is squeezing you in between other projects, doesn’t have the proper materials or enough labor, and then leaves to complete another job before coming back to yours. Meanwhile the hole in your roof has let in rain, leaves, and maybe even a few critters, all of which have caused more damage. Housing projects can spiral out of control fast and without a solid plan from the beginning, you could have squirrels in your attic year round. The same goes for federal IT projects. Federal government IT investment oversight is increasingly focused on baseline management for good reason. Effective baseline management allows the project manager (PM) to achieve the intended business outcome in a cost-effective way, on time, and within budget. It also provides early warning of increasing variances from planned cost or schedule, thus giving the PM a chance to identify and address any red flags. When baseline management is ineffective, however, IT projects can easily go off the rails because there is no useful “blueprint” for achieving the intended outcome, no accurate measurement of cost and schedule performance, no early warning of problems, and no opportunity to resolve problems while they are still fixable. The results can include increased IT investment costs, schedule delay, “scope creep,” and failure to achieve the intended outcome. Federal IT capital planning efforts increasingly focus on supporting, guiding, evaluating, and improving IT baseline management processes because of how critical they are to IT project success. The Office of Management and Budget (OMB) memorandum M-10-27 requires all Federal agencies to implement IT baseline management policies, processes, and training. Investments that do not remain within +/- 90% of planned cost an schedule are subject to increased scrutiny from oversight entities as well as possible suspension or termination. Establishing the Baseline The first significant step is creating a sound, accurate, and comprehensive baseline. This is the foundation for effective baseline management over the life cycle of the project. Here are five IT capital planning strategies for working with PMs and Integrated Project Teams to ensure this happens. 1. Document Requirements Clearly describe the two sets of requirements that must be met in establishing a baseline: The activities and analyses that must be performed to identify all of the content of the baseline (see the Tracker for Establishing a Baseline, below). The criteria against which data in the proposed baseline will be evaluated (see the Requirements for Baseline Data, below). PMs and investment teams must understand both sets of requirements. Specific documented requirements and frequent meetings between the PM, investment team, and the IT Capital Planning team within the Office of the Chief Information Officer (OCIO) ensure everyone understands the requirements for establishing a baseline, available resources, evaluation criteria, and appropriate sequencing of planning activities. 2. Provide Resources Training sessions, templates, guides, and tools will (1) help PMs and investment teams comply with requirements and (2) provide standardized processes across the enterprise. For example, simply requiring an Integrated Baseline Review (IBR) is not as useful as providing an IBR training session, an IBR Guide, and an IBR Summary Report template. A departmental IT Cost Estimation Guide provides a useful, standardized structure and process for estimating, improving, and validating planned costs for an IT investment. 3. Track Progress The tracker (below) is a useful tool for summarizing requirements and tracking progress when establishing the baseline. Tracker for Establishing a Baseline 4. Evaluate Deliverables via Scorecards The OCIO evaluates the PM’s deliverables, prepares the scorecards, and then provides the scorecards to the PM, sponsor, program manager, and other key stakeholders. First and second scorecards can: Ensure the baseline requirements are met Support a standardized process across the enterprise Promote the establishment of a sound, comprehensive baseline that will be useful in managing a successful project Identify artifacts or analyses that require additional effort Engage sponsors, PMs, and others by providing visibility into the process Prevent expending resources on projects that have not been properly planned First Scorecard The first scorecard measures the quality of the initial requirements analysis, the evaluation of cloud solutions, the cost benefit analysis, the acquisition plan, the performance goals, and the initial draft of the baseline. This first scorecard provides an opportunity to identify and address problems before expending further resources. For example if a technical architecture schematic cannot be produced, it is premature to develop the baseline. Likewise if useful performance goals and target metrics cannot be identified, the scope and purpose of the investment are not adequately understood. This scorecard process stops the organization from spending additional resources before the necessary planning has been accomplished. Second Scorecard The second scorecard focuses on the IBR Summary Report, the IT Cost Estimation Summary Report, the Earned Value Management (EVM) Assessment, and the proposed baseline. The results of the IBR should strengthen the draft baseline and reflect stakeholder consensus on activities, cost, schedule, risk management, and other elements of the baseline. The results of the cost estimation process should further refine and validate planned costs in the draft baseline and show sponsor approval of the final planned costs. The EVM Assessment shows that the person who will be handling EVM reporting for the investment understands basic EVM concepts. The proposed baseline represents an improved version of the draft baseline. 5. Incorporate Lessons Learned The process and requirements for establishing a baseline can be improved by analyzing IT acquisition problems. For example, if IT security configuration issues halt a system development effort, it suggests that technical requirements were not adequately analyzed or understood in the beginning. How can the process and requirements for establishing a baseline be modified to incorporate more robust requirements analysis? If actual costs increase significantly, how can the process of estimating planned costs be strengthened? Baseline management oversight can and should be improved on an ongoing basis by examining what works well, what doesn’t work so well, and what process improvements can be made. So the next time your roof needs to be replaced, don’t rush into it without getting a solid idea of what it will cost, how much time it will take, and what the exact outcome will be. Otherwise you may have some wet furniture and furry roommates in the very near future.