systems engineering | Life, Project Management, and Everything

Shake it Out – Embracing the Future of Program Management – Part Two: Private Industry Program and Project Management in Aerospace, Space, and Defense

In my previous post, I focused on Program and Project Management in the Public Interest, and the characteristics of its environment, especially from the perspective of the government program and acquisition disciplines. The purpose of this exploration is to lay the groundwork for understanding the future of program management—and the resulting technological and organizational challenges that are required to support that change.

The next part of this exploration is to define the motivations, characteristics, and disciplines of private industry equivalencies. Here there are commonalities, but also significant differences, that relate to the relationship and interplay between public investment, policy and acquisition, and private business interests.

Consistent with our initial focus on public interest project and program management (PPM), the vertical with the greatest relationship to it is found in the very specialized fields of aerospace, space, and defense. I will therefore first begin with this industry vertical.

Private Industry Program and Project Management

Aerospace, Space & Defense (ASD). It is here that we find commercial practice that comes closest to the types of structure, rules, and disciplines found in public interest PPM. As a result, it is also here where we find the most interesting areas of conflict and conciliation between private motivations and public needs and duties. Particularly since most of the business activity in this vertical is generated by and dependent on federal government acquisition strategy and policy.

On the defense side, the antecedent policy documents guiding acquisition and other measures are the National Security Strategy (NSS), which is produced by the President’s staff, the National Defense Strategy (NDS), which further translates and refines the NSS, and the National Military Strategy (NMS), which is delivered to the Secretary of Defense by the Joint Chiefs of Staff of the various military services, which is designed to provide unfettered military advise to the Secretary of Defense.

Note that the U.S. Department of Defense (DoD) and the related agencies, including the intelligence agencies, operate under a strict chain of command that ensures civilian control under the National Military Establishment. Aside from these structures, the documents and resulting legislation from DoD actions also impact such civilian agencies as the Department of Energy (DOE), Department of Homeland Security (DHS), the National Aeronautics and Space Administration (NASA), and the Federal Aviation Administration (FAA), among others.

The countervailing power and checks-and-balances on this Executive Branch power lies with the appropriation and oversight powers of the Congress. Until the various policies are funded and authorized by Congress, the general tenor of military, intelligence, and other operations have tangential, though not insignificant effects, on the private economy. Still, in terms of affecting how programs and projects are monitored, it is within the appropriation and authorization bills that we find the locus of power. As one of my program managers reminded me during my first round through the budget hearing process, “everyone talks, but money walks.”

On the Aerospace side, there are two main markets. One is related to commercial aircraft, parts, and engines sold to the various world airlines. The other is related to government’s role in non-defense research and development, as well as activities related to private-public partnerships, such as those related to space exploration. The individual civilian departments of government also publish their own strategic plans based on their roles, from which acquisition strategy follows. These long terms strategic plans, usually revised at least every five years, are then further refined into strategic implementation plans by various labs and directorates.

The suppliers and developers of the products and services for government, which represents the bulk of ASD, face many of the same challenges delineated in surveying their government counterparts. The difference, of course, is that these are private entities where the obligations and resulting mores are derived from business practice and contractual obligations and specifications.

This is not to imply a lack of commitment or dedication on the part of private entities. But it is an important distinction, particularly since financial incentives and self-interest are paramount considerations. A contract negotiator, for example, in order to be effective, must understand the underlying pressures and relative position of each of the competitors in the market being addressed. This individual should also be familiar with the particular core technical competencies of the competitors as well as their own strategic plans, the financial positions and goals that they share with their shareholders in the case of publicly traded corporations, and whether actual competition exists.

The Structure of the Market. Given the mergers and acquisitions of the last 30 years, along with the consolidation promoted by the Department of Defense as unofficial policy after the fall of the Berlin Wall and the lapse of antitrust enforcement, the portion of ASD and Space that rely on direct government funding, even those that participate in public-private ventures where risk sharing is involved, operate in a monopsony—the condition in which a single buyer—the U.S. government—substantially controls the market as the main purchaser of supplies and services. This monopsony market is then served by a supplier market that is largely an oligopoly—where there are few suppliers and limited competition—and where, in some technical domains, some suppliers exert monopoly power.

Acknowledging this condition informs us regarding the operational motivators of this market segment in relation to culture, practice, and the disciplines and professions employed.

In the first case, given the position of the U.S. government, the normal pressures of market competition and market incentives do not apply to the few competitors participating in the market. As a result, only the main buyer has the power to recreate, in an artificial manner, an environment which replicate the market incentives and penalties normally employed in a normative, highly diverse and competitive market.

Along these lines, for market incentives, the government can, and often does, act as the angel investor, given the rigorous need for R&D in such efforts. It can also lower the barriers to participation in order to encourage more competition and innovation. This can be deployed across the entire range of limited competitors, or it can be expansive in its approach to invite new participants.

Market penalties that are recreated in this environment usually target what economists call “rent-seeking behavior.” This is a situation where there may be incumbents that seek to increase their own wealth without creating new benefits, innovation, or providing additional wealth to society. Lobbying, glad-handing, cronyism, and other methods are employed and, oftentimes, rampant under monosponistic systems. Revolving-door practices, in which the former government official responsible for oversight obtains employment in the same industry and, oftentimes, with the same company, is too often seen in these cases.

Where there are few competitors, market participants will often play follow-the-leader and align themselves to dominate particular segments of the market in appealing to the government or elected representatives for business. This may mean that, in many cases, they team with their ostensible competitors to provide a diverse set of expertise from the various areas of specialty. As with any business, profitability is of paramount importance, for without profit there can be no business operations. It is here: the maximization of profit and shareholder value, that is the locus of power in understanding the motivation of these and most businesses.

This is not a value judgment. As faulty and risky as this system may be, no better business structure has been found to provide value to the public through incentives for productive work, innovation, the satisfaction of demand, and efficiency. The challenge, apart from what political leadership decides to do regarding the rules of the market, is to make those rules that do exist work in the public interest through fair, ethical, and open contracting practices.

To do this successfully requires contracting and negotiating expertise. To many executives and non-contracting personnel, negotiations appear to be a zero-sum game. No doubt, popular culture, mass media and movies, and self-promoting business people help mold this perception. Those from the legal profession, in particular, deal with a negotiation as an extension of the adversarial processes through which they usually operate. This is understandable given their education, and usually disastrous.

As an attorney friend of mine once observed: “My job, if I have done it right, is to ensure that everyone walking out of the room is in some way unhappy. Your job, in contrast, is to ensure that everyone walking out of it is happy.” While a generalization—and told tongue-in-cheek—it highlights the core difference in approach between these competing perspectives.

A good negotiator has learned that, given two motivated sides coming together to form a contract, that there is an area of intersection where both parties will view the deal being struck as meeting their goals, and as such, fair and reasonable. It is the job of the negotiator to find that area of mutual fairness, while also ensuring that the contract is clear and free of ambiguity, and that the structure of the instrument—price and/or cost, delivery, technical specification, statement of work or performance specification, key performance parameters, measures of performance, measures of effectiveness, management, sufficiency of capability (responsibility), and expertise—sets up the parties involved for success. A bad contract can no more be made good than the poorly prepared and compacted soil and foundation of a house be made good after the building goes up.

The purpose of a good contract is to avoid litigation, not to increase the likelihood of it happening. Furthermore, it serves the interests of neither side to obtain a product or service at a price, or under such onerous conditions, where the enterprise fails to survive. Alternatively, it does a supplier little good to obtain a contract that provides the customer with little financial flexibility, that fails to fully deliver on its commitments, that adversely affects its reputation, or that is perceived in a negative light by the public.

Effective negotiators on both sides of the table are aware of these risks and hazards, and so each is responsible for the final result, though often the power dynamic between the parties may be asymmetrical, depending on the specific situation. It is one of the few cases in which parties having both mutual and competing interests are brought together where each side is responsible for ensuring that the other does not hazard their organization. It is in this way that a contract—specifically one that consists of a long-term R&D cost-plus contract—is much like a partnership. Both parties must act in good faith to ensure the success of the project—all other considerations aside—once the contract is signed.

In this way, the manner of negotiating and executing contracts is very much a microcosm of civil society as a whole, for good or for bad, depending on the practices employed.

Given that the structure of aerospace, space, and defense consists of one dominant buyer with few major suppliers, the disciplines required relate to the details of the contract and its resulting requirements that establish the rules of governance.

As I outlined in my previous post, the characteristics of program and project management in the public interest, which are the products of contract management, are focused on successfully developing and obtaining a product to meet particular goals of the public under law, practice, and other delineated specific characteristics.

As a result, the skill-sets that are of paramount importance to business in this market prior to contract award are cost estimating, applied engineering expertise including systems engineering, financial management, contract negotiation, and law. The remainder of disciplines regarding project and program management expertise follow based on what has been established in the contract and the amount of leeway the contracting instrument provides in terms of risk management, cost recovery, and profit maximization, but the main difference is that this approach to the project leans more toward contract management.

Another consideration in which domains are brought to bear relates to position of the business in terms of market share and level of dominance in a particular segment of the market. For example, a company may decide to allow a lower than desired target profit. In the most extreme cases, the company may allow the contract to become a loss leader in order to continue to dominate a core competency or to prevent new entries into that portion of the market.

On the other side of the table, government negotiators are prohibited by the Federal Acquisition Regulation (the FAR) from allowing companies to “buy-in” by proposing an obviously lowball offer, but some do in any event, whether it is due to lack of expertise or bowing to the exigencies of price or cost. This last condition, combined with rent-seeking behavior mentioned earlier, where they occur, will distort and undermine the practices and indicators needed for effective project and program management. In these cases, the dysfunctional result is to create incentives to maximize revenue and scope through change orders, contracting language ambiguity, and price inelasticity. This also creates an environment that is resistant to innovation and rewards inefficiency.

But apart from these exceptions, the contract and its provisions, requirements, and type are what determine the structure of the eventual project or program management team. Unlike the commercial markets in which there are many competitors, the government through negotiation will determine the manner of burdening rate structures and allowable profit or margin. This last figure is determined by the contract type and the perceived risk of the contract goals to the contractor. The higher the risk, the higher the allowed margin or profit. The reverse applies as well.

Given this basis, the interplay between private entities and the public acquisition organizations, including the policy-setting staffs, are also of primary concern. Decision-makers, influences, and subject-matter experts from these entities participate together in what are ostensibly professional organizations, such as the National Defense Industrial Association (NDIA), the Project Management Institute (PMI), the College of Scheduling (CoS), the College of Performance Management (CPM), the International Council on Systems Engineering (INCOSE), the National Contract Management Association (NCMA), and the International Cost Estimating and Analysis Association (ICEAA), among the most frequently attended by these groups. Corresponding and associated private and professional groups are the Project Control Academy and the Association for Computing Machinery (ACM).

This list is by no means exhaustive, but from the perspective of suppliers to public agencies, NDIA, PMI, CoS, and CPM are of particular interest because much of the business of influencing policy and the details of its application are accomplished here. In this manner, the interests of the participants from the corporate side of the equation relate to those areas always of concern: business certainty, minimization of oversight, market and government influence. The market for several years now has been reactive, not proactive.

There is no doubt that business organizations from local Chambers of Commerce to specialized trade groups that bring with them the advantages of finding mutual interests and synergy. All also come with the ills and dysfunction, to varying degrees, borne from self-promotion, glad-handing, back-scratching, and ossification.

In groups where there is little appetite to upend the status quo, innovation and change, is viewed with suspicion and as being risky. In such cases the standard reaction is cognitive dissonance. At least until measures can be taken to subsume or control the pace and nature of the change. This is particularly true in the area of project and program management in general and integrated project, program and portfolio management (IPPM), in particular.

Absent the appetite on the part of DoD to replicate market forces that drive the acceptance of innovative IPPM approaches, one large event and various evolutionary aviation and space technology trends have upended the ecosystem of rent-seeking, reaction, and incumbents bent on maintaining the status quo.

The one large event, of course, came about from the changes wrought by the Covid pandemic. The other, evolutionary changes, are a result of the acceleration of software technology in capturing and transforming big(ger) dataset combined with open business intelligence systems that can be flexibly delivered locally and via the Cloud.

I also predict that these changes will make hard-coded, purpose-driven niche applications obsolete within the next five years, as well as those companies that have built their businesses around delivering custom, niche applications, and MS Excel spreadsheets, and those core companies that are comfortable suboptimizing and reacting to delivering the letter, if not the spirit, of good business practice expected under their contracts.

Walking hand-in-hand with these technological and business developments, the business of the aerospace, space and defense market, in general, is facing a window opening for new entries and greater competition borne of emergent engineering and technological exigencies that demand innovation and new approaches to old, persistent problems.

The coronavirus pandemic and new challenges from the realities of global competition, global warming, geopolitical rivalries; aviation, space and atmospheric science; and the revolution in data capture, transformation, and optimization are upending a period of quiescence and retrenchment in the market. These factors are moving the urgency of innovation and change to the left both rapidly and in a disruptive manner that will only accelerate after the immediate pandemic crisis passes.

In my studies of Toynbee and other historians (outside of my day job, I am also credentialed in political science and history, among other disciplines, through both undergraduate and graduate education), I have observed that societies and cultures that do not embrace the future and confront their challenges effectively, and that do not do so in a constructive manner, find themselves overrun by it and them. History is the chronicle of human frailty, tragedy, and failure interspersed by amazing periods of resilience, human flourishing, advancement, and hope.

As it relates to our more prosaic concerns, Deloitte has published an insightful paper on the 2021 industry outlook. Among the identified short-term developments are:

A slow recovery in passenger travel may impact aircraft deliveries and industry revenues in commercial aviation,
The defense sector will remain stable as countries plan to sustain their military capabilities,
Satellite broadband, space exploration and militarization will drive growth,
Industry will shift to transforming supply chains into more resilient and dynamic networks,
Merger and acquisitions are likely to recover in 2021 as a hedge toward ensuring long-term growth and market share.

More importantly, the longer-term changes to the industry are being driven by the following technological and market changes:

Advanced aerial mobility (AAM). Both FAA and NASA are making investments in this area, and so the opening exists for new entries into the market, including new entries in the supply chain, that will disrupt the giants (absent a permissive M&A stance under the new Administration in Washington). AAM is the new paradigm to introduce safe, short-distance, daily-commute flying technologies using vertical lift.
Hypersonics. Given the touted investment of Russia and China into this technology as a means of leveraging against the power projection of U.S. forces, particularly its Navy and carrier battle groups (aside from the apparent fact that Vladimir Putin, the president of Upper Volta with Missiles and Hackers, really hates Disney World), the DoD is projected to fast-track hypersonic capabilities and countermeasures.
Electric propulsion. NASA is investing in cost-sharing capabilities to leverage electric propulsion technologies, looking to benefit from the start-up growth in this sector. This is an exciting development which has the potential to transform the entire industry over the next decade and after.
Hydrogen-powered aircraft. OEMs are continuing to pour private investment money into start-ups looking to introduce more fuel-efficient and clean energy alternatives. As with electric propulsion, there are prototypes of these aircraft being produced and as public investments into cost-sharing and market-investment strategies take hold, the U.S., Europe, and Asia are looking at a more diverse and innovative aerospace, space, and defense market.

Given the present condition of the industry, and the emerging technological developments and resulting transformation of flight, propulsion, and fuel sources, the concept and definitions used in project and program management require a revision to meet the exigencies of the new market.

For both industry and government, in order to address these new developments, I believe that a new language is necessary, as well as a complete revision to what is considered to be the acceptable baseline of best business practice and the art of the possible. Only then will organizations and companies be positioned to address the challenges these new forms of investment and partnering systems will raise.

The New Language of Integrated Program, Project, and Portfolio Management (IPPM).

First a digression to the past: while I was on active duty in the Navy, near the end of my career, I was assigned to the staff of the Office of the Undersecretary of Defense for Acquisition and Technology (OUSD(A&T)). Ostensibly, my assignment was to give me a place to transition from the Service. Thus, I followed the senior executive, who was PEO(A) at NAVAIR, to the Pentagon, simultaneously with the transition of NAVAIR to Patuxent River, Maryland. In reality, I had been tasked by the senior executive, Mr. Dan Czelusniak, to explore and achieve three goals:

To develop a common schema by supporting an existing contract for the collection of data from DoD suppliers from cost-plus R&D contracts with the goal in mind of creating a master historical database of contract performance and technological development risk. This schema would first be directed to cost performance, or EVM;
To continue to develop a language, methodology, and standard, first started and funded by NAVAIR, for the integration of systems engineering and technical performance management into the program management business rhythm;
To create and define a definition of Integrated Program Management.

I largely achieved the first two during my relatively brief period there.

The first became known and the Integrated Digital Environment (IDE), which was refined and fully implemented after my departure from the Service. Much of this work is the basis for data capture, transformation, and load (ETL) today. There had already been a good deal of work by private individuals, organizations, and other governments in establishing common schemas, which were first applied to the transportation and shipping industries. But the team of individuals I worked with were able to set the bar for what followed across datasets.

The second was completed and turned over to the Services and federal agencies, many of whom adopted the initial approach, and refined it as well to inform, through the identification of technical risk, cost performance and technical achievement. Much of this knowledge already existed in the Systems Engineering community, but working with INCOSE, a group of like-minded individuals were able to take the work from the proof-of-concept, which was awarded the Acker in Skill in Communication award at the DAU Acquisition Research Symposium, and turn it into the TPM and KPP standard used by organizations today.

The third began with establishing my position, which hadn’t existed until my arrival: Lead Action Officer, Integrated Program Management. Gary Christle, who was the senior executive in charge of the staff, asked me “What is Integrated Program Management?” I responded: “I don’t know, sir, but I intend to find out.” Unfortunately, this is the initiative that has still eluded both industry and government, but not without some advancement.

Note that this position with its charter to define IPM was created over 24 years ago—about the same time it takes, apparently, to produce an operational fighter jet. I note this with no flippancy, for I believe that the connection is more than just coincidental.

When spoken of, IPM and IPPM are oftentimes restricted to the concept of cost (read cost performance or EVM) and schedule integration, with aggregated portfolio organization across a selected number of projects thrown in, in the latter case. That was considered advancement in 1997. But today, we seem to be stuck in time. In light of present technology and capabilities, this is a self-limiting concept.

This concept is technologically supported by a neutral schema that is authored and managed by DoD. While essential to data capture and transformation—and because of this fact—it is currently the target by incumbents as a means of further limiting even this self-limited definition in practice. It is ironic that a technological advance that supports data-driven in lieu of report-driven information integration is being influenced to support the old paradigm.

The motivations are varied: industry suppliers who aim to restrict access to performance data under project and program management, incumbent technology providers who wish to keep the changes in data capture and transformation restricted to their limited capabilities, consulting companies aligned with technology incumbents, and staff augmentation firms dependent on keeping their customers dependent on custom application development and Excel workbooks. All of these forces work through the various professional organizations which work to influence government policy, hoping to establish themselves as the arbiters of the possible and the acceptable.

Note that oftentimes the requirements under project management are often critiqued under the rubric of government regulation. But that is a misnomer: it is an extension of government contract management. Another critique is made from the perspective of overhead costs. But management costs money, and one would not (or at least should not) drive a car or own a house without insurance and a budget for maintenance, much less a multi-year high-cost project involving the public’s money. In addition, as I have written previously which is supported by the literature, data-driven systems actually reduce costs and overhead.

All of these factors contribute to ossification, and impose artificial blinders that, absent reform, will undermine meeting the new paradigms of 21^st Century project management, given that the limited concept of IPM was obviously insufficient to address the challenges of the transitional decade that broached the last century.

Embracing the Future in Aerospace, Space, and Defense

As indicated, the aerospace and space science and technology verticals are entering a new and exciting phase of technological innovation resulting from investments in start-ups and R&D, including public-private cost-sharing arrangements.

IPM to Project Life-Cycle Management. Given the baggage that attends the acronym IPM, and the worldwide trend to data-driven decision-making, it is time to adjust the language of project and program management to align to it. In lieu of IPM, I suggest Project Life-Cycle Management to define the approach to project and program data and information management.
Functionality-Driven to Data-Driven Applications. Our software, systems and procedures must be able to support that infrastructure and be similarly in alignment with that manner of thinking. This evolution includes the following attributes:
- Data Agnosticism. As our decision-making methods expand to include a wider, deeper, and more comprehensive interdisciplinary approach, our underlying systems must be able to access data in this same manner. As such, these systems must be data agnostic.
- Data neutrality. In order to optimize access to data, the overhead and effort needed to access data must be greatly reduced. Using data science and analysis to restructure pre-conditioned data in order to overcome proprietary lexicons—an approach used for business intelligence systems since the 1980s—provides no added value to either the data or the organization. If data access is ad hoc and customized in every implementation, the value of the effort cannot either persist, nor is the return on investment fully realized. It backs the customer into a corner in terms of flexibility and innovation. Thus, pre-configured data capture, extract, transformation, and load (ETL) into a non-proprietary and objective format, which applies to all data types used in project and program management systems, is essential to providing the basis for a knowledge-based environment that encourages discovery from data. This approach in ETL is enhanced by the utilization of neutral data schemas.
- Data in Lieu of Reporting and Visualization. No doubt that data must be visualized at some point—preferably after its transformation and load into the database with other, interrelated data elements that illuminate information to enhance the knowledge of the decisionmaker. This implies that systems that rely on physical report formats, charts, and graphs as the goal are not in alignment with the new paradigm. Where Excel spreadsheets and PowerPoint are used as a management system, it is the preparer is providing the interpretation, in a manner that predisposes the possible alternatives of interpretation. The goal, instead, is to have data speak for itself. It is the data, transformed into information, interrelated and contextualized to create intelligence that is the goal.
- All of the Data, All of the Time. The cost of 1TB of data compared to 1MB of data is the marginal cost of the additional electrons to produce it. Our systems must be able to capture all of the data essential to effective decision-making in the periodicity determined by the nature of the data. Thus, our software systems must be able to relate data at all levels and to scale from simplistic datasets to extremely large ones. It should do so in such a way that the option for determining what, among the full menu of data options available, is relevant rests in the consumer of that data.
- Open Systems. Software solution providers beginning with the introduction of widespread CPU capability have manufactured software to perform particular functions based on particular disciplines and very specific capabilities. As noted earlier, these software applications are functionality-focused and proprietary in structure, method, and data. For data-driven project and program requirements, software systems must be flexible enough to accommodate a wide range of analytical and visualization demands in allowing the data to determine the rules of engagement. This implies systems that are open in two ways: data agnosticism, as already noted, but also open in terms of the user environment.
- Flexible Application Configuration. Our systems must be able to address the needs of the various disciplines in their details, while also allowing for integration and contextualization of interrelated data across domains. As with Open Systems to data and the user environment, openness through the ability to roll out multiple specialized applications from a common platform places the subject matter expert and program manager in the driver’s seat in terms of data analysis and visualization. An effective open platform also reduces the overhead associated with limited purpose-driven, disconnected and proprietary niche applications.
- No-Code/Low-Code. Given that data and the consumer will determine both the source and method of delivery, our open systems should provide an environment that supports Agile development and deployment of customization and new requirements.
- Knowledge-Based Content. Given the extensive amount of experience and education recorded and documented in the literature, our systems must, at the very least, provide a baseline of predictive analytics and visualization methods usually found in the more limited, purpose-built hardcoded applications, if not more expansive. This knowledge-based content, however, must be easily expandable and refinable, given the other attributes of openness, flexibility, and application configuration. In this manner, our 21^st century project and program management systems must possess the attributes of a hybrid system: providing the functionality of the traditional niche systems with the flexibility and power of a business intelligence system enhanced by COTS data capture and transformation.
- Ease of Use. The flexibility and power of these systems must be such that implementation and deployment are rapid, and that new user environment applications can be quickly deployed. Furthermore, the end user should be able to determine the level of complexity or simplicity of the environment to support ease of use.

Focus on the Earliest Indicator. A good deal of effort since the late 1990s has been expended on defining the highest level of summary data that is sufficient to inform earned value, with schedule integration derived from the WBS, oftentimes summarized on a one-to-many basis as well. This perspective is biased toward believing that cost performance is the basis for determining project control and performance. But even when related to cost, the focus is backwards. The project lifecycle in its optimized form exists of the following progression:

Project Goals and Contract (framing assumptions) –> Systems Engineering, CDRLs, KPPs, MoEs, MoPs, TPMs –> Project Estimate –> Project Plan –> IMS –> Risk and Uncertainty Analysis –> Financial Planning and Execution –> PMB –> EVM

As I’ve documented in this blog over the years, DoD studies have shown that, while greater detail within the EVM data may not garner greater early warning, proper integration with the schedule at the work package level does. Program variances first appear in the IMS. A good IMS, thus, is key to collecting and acting as the main execution document. This is why many program managers who are largely absent in the last decade or so from the professional organizations listed, tend to assert that EVM is like “looking in the rearview mirror.” It isn’t that it is not essential, but it is true that it is not the earliest indicator of variances from expected baseline project performance.

Thus, the emphasis going forward under this new paradigm is not to continue the emphasis and a central role for EVM, but a shift to the earliest indicator for each aspect of the program that defines its framing assumptions.

Systems Engineering: It’s not Space Science, it’s Space Engineering, which is harder.
The focus on start-up financing and developmental cost-sharing shifts the focus to systems engineering configuration control and technical performance indicators. The emphasis on meeting expectations, program goals, and achieving milestones within the cost share make it essential to be able to identify fatal variances, long before conventional cost performance indicators show variances. The concern of the program manager in these cases isn’t so much on the estimate at complete, but whether the industry partner will be able to deploy the technology within the acceptable range of the MoEs, MoPs, TPPs, and KPPs, and not exceed the government’s portion of the cost share. Thus, the incentive is to not only identify variances and unacceptable risk at the earliest indicator, but to do so in terms of whether the end-item technology will be successfully deployed, or whether the government should cut its losses.

Risk and Uncertainty is more than SRA. The late 20^th century approach to risk management is to run a simulated Monte Carlo analysis against the schedule, and to identify alternative critical paths and any unacceptable risks within the critical path. This is known as the schedule risk analysis, or SRA. While valuable, the ratio of personnel engaged in risk management is much smaller than the staffs devoted to schedule and cost analysis.

This is no doubt due to the specialized language and techniques devoted to risk and uncertainty. This segregation of risk from mainstream project and program analysis has severely restricted both the utility and the real-world impact of risk analysis on program management decision-making.

But risk and uncertainty extend beyond the schedule risk analysis, and their utility in an environment of aggressive investment in new technology, innovation, and new entries to the market will place these assessments at center stage. In reality, our ability to apply risk analysis techniques extends to the project plan, to technical performance indicators, to estimating, to the integrated master schedule (IMS), and to cost, both financial and from an earned value perspective. Combined with the need to identify risk and major variances using the earliest indicator, risk analysis becomes pivotal to mainstream program analysis and decision-making.

Conclusions from Part Two

The ASD industry is most closely aligned with PPM in the public interest. Two overarching trends that are transforming this market that are overcoming the inertia and ossification of PPM thought are the communications and information systems employed in response to the coronavirus pandemic, which opened pathways to new ways of thinking about the status quo, and the start-ups and new entries into the ASD market, borne from the investments in new technologies arising from external market, geo-political, space science, global warming, and propulsion trends, as well as new technologies and methods being employed in data and information technology that drive greater efficiency and productivity. These changes have forced a new language and new expectations as to the art of the necessary, as well as the art of the possible, for PPM. This new language includes a transition to the concept of the optimal capture and use of all data across the program management life cycle with greater emphasis on systems engineering, technical performance, and risk.

Having summarized the new program paradigm in Aerospace, Space, and Defense, my next post will assess the characteristics of program management in various commercial industries, the rising trends in these verticals, and what that means for the project and program management discipline.

Shake it Out – Embracing the Future in Program Management – Part One: Program and Project Management in the Public Interest

I heard the song from which I derived the title to this post sung by Florence and the Machine and was inspired to sit down and write about what I see as the future in program management.

Thus, my blogging radio silence has ended as I begin to process and share my observations and essential achievements over the last couple of years.

Some of my reticence in writing has been due to the continual drumbeat of both outrageous and polarizing speech that had dominated our lives for four years. Combined with the resulting societal polarization, I was overwhelmed by the hyper-politicized environment which has fostered disinformation and dysfunction. Those who wish to seek my first and current word on this subject need only visit my blog post, “In Defense of Empiricism” at the AITS Blogging Alliance here.

It is hard to believe that I published that post four years ago. I stand by it today and believe that it remains as valid, if not more so, than it did when I wrote and shared it.

Finally, the last and most important reason for my relative silence has been that I have been hard at work putting my money and reputation where my blogging fingers have been—in the face of a pandemic that has transformed and transfigured our social and economic lives.

My company—the conduit that provides the insights I share here—is SNA Software LLC. We are a small, veteran-owned company and we specialize in data capture, transformation, contextualization and visualization. We do it in a way that removes significant effort in these processes, ensures reliability and trust, to incorporate off-the-shelf functionality that provides insight, and empowers the user by leveraging the power of open systems, especially in program and project management.

Program and Project Management in the Public Interest

There are two aspects to the business world that we inhabit: commercial and government; both, however, usually relate to some aspect of the public interest, which is our forte.

There are also two concepts about this subject to unpack.

The first is distinguishing between program and project management. In this concept, a program is an overarching effort that may consist of individual efforts that, together, will result in the production or completion of a system, whether that is a weapons system, a satellite, a spacecraft, or an engine. It could even be a dam or some other aspect of public works.

A project under this concept is a self-contained effort separated organizationally from the larger entity, which possesses a clearly defined start and finish, a defined and allocated budget, and a set of plans, a performance management feedback system, and overarching goals or “framing assumptions” that define what constitutes the state of being “done.”

Oftentimes the terms “program” and “project” are used interchangeably, but the difference for these types of efforts is important and goes beyond a shallow understanding of the semantics. A program will also consider the lifecycle of the program: the follow-on logistics, the interrelationship of the end item to other components that will constitute the deployed system or systems, and any iterative efforts relating to improvement, revision, and modernization.

A word on the term “portfolio” is also worth a mention in the context of our theme. A portfolio is simply a summary of the projects or programs under an organizational entity that has both reporting and oversight responsibility for them. They may be interrelated or independent in their efforts, but all must report in some way, either due to fiduciary, resource, or oversight concerns, to that overarching entity.

The second concept relates to the term “public interest.” Programs and projects under this concept are those that must address the following characteristics: legality, governance, complexity, integrity, leadership, oversight, and subject matter expertise. I placed these in no particular order.

What we call in modern times “public interest” was originally called “public virtue” by the founders of the United States, which embody the ideals of the American Revolution, and upon which our experiment in democratic republicanism is built. It consists of conducting oneself in a manner in which the good of the whole—the public—outweighs personal interests and pursuits. Self-dealing need not apply.

This is no idealistic form of self-delusion: I understand, as do my colleagues, that we are, at heart, a commercial profit-making enterprise. But the manner in which we engage with government requires a different set of rules and many of these rules are codified in law and ethical practice. While others do not always feel obliged to live by these rules, we govern ourselves and so choose to apply these virtues—and to seek to support and change our system to encourage such behavior to as to be the norm—even in direct interactions with government personnel where we feel these virtues have been violated.

Characteristics of Public Interest Programs

Thus, the characteristics outlined above apply to program and project management in the public interest in the following manner:

Legality: That Public Interest Programs are an artifact of law and statute and are specifically designed to benefit the public as a whole.

At heart, program and project management are based on contractual obligations, whether those instruments apply internally or externally. As a result, everyone involved in the program and project management discipline is, by default, part of the acquisition community and the acquisition process. The law that applies to all government acquisition systems is based on the Federal Acquisition Regulation (FAR). There are also oversight and fiduciary responsibilities that apply as a result of the need for accountability under the Congressional appropriations process as well as ethical standards that apply, such as those under the Truth in Negotiations Act (TINA). While broad in the management flexibility they allow, violations of these statutes come with serious consequences. Thus, as a basis for establishing hard and fast guardrails in the management of programs and projects. Individual government agencies and military services also publish additional standards that supplement the legal requirements. An example is the Department of Defense FAR Supplement (DFARS). Commercial entities that hold government contracts in relation to Program Management Offices (PMOs) must sign on to both FAR and agency contractual clauses, which will then flow down to their subcontractors. Thus, the enforcement of these norms is both structured and consistent.

Governance: That the Organizational Structure and Disciplines deriving from Public Interest Programs are a result of both Contract and Regulatory Practice under the concept of Government Sovereignty.

The government and supplier PMOs are formed as a result of a contractual obligation for a particular purpose. Government contracting is unique since government entities are the sovereign. In the case of the United States, the sovereign is the elected government of the United States, which derives its legitimacy from the people of the United States as a whole. Constitutionally, the Executive Branch is tasked with the acquisition responsibility, but the manner and method of this responsibility is defined by statute.

Thus, during negotiations and unlike in commercial practice, the commercial entity is always the offeror and the United States always the party that either accepts or rejects the offer (the acceptor). This relationship has ramifications in contract enforcement and governance of the effort after award. It also allows the government to dictate the terms of the award through its solicitations. Furthermore, provisions from law establish cases where the burden for performance is on the entity (the supplier) providing the supplies and services.

Thus, the establishment of the PMO and oversight organizations have a legal basis, aside from considerations of best business practice. The details of governance within the bounds of legal guidance are those that apply through agency administrative law and regulation, oftentimes based on best business practice. These detailed practices of governance are usually established as a result of hard-learned experience: establishment of disciplines (systems engineering and technical performance, planning, performance management, cost control, financial execution, schedule, and progress assessment), the periodicity of reporting, the manner of oversight, the manner of liaison between the supplier and government PMOs, and alignment to the organization’s goals.

Complexity: That Public Interest Programs possess a level of both technical and organizational complexity unequaled in the private sector.

Program and project management in government involves a level of complexity rarely found in similar non-governmental commercial efforts. Aligning the contractual requirements, as an example, to an assessment of the future characteristics of a fighter aircraft needed to support the U.S. National Defense Strategy, built on the assessments by the intelligence agencies regarding future threats, is a unique aspect of government acquisition.

Furthermore, while relying on the expertise of private industry of such systems that support national defense, as well as those that support space exploration, energy, and a host of other needs, the items being acquired, which require cost type R&D contracts that involve program management, by definition are those where the necessary solutions are not readily available as commercial end items.

Oftentimes these requirements are built onto and extend existing off-the-shelf capabilities. But given that government investment in R&D represents the majority of this type of spending in the economy, absent it, technology and other efforts directed to meeting defense, economic, societal, climate, and space exploration challenges of the future would most likely not be met—or those that do will benefit only a portion of the populace. The federal government uniquely possesses the legal legitimacy, resources, and expertise to undertake such R&D that, pushing the envelope on capabilities, involves both epistemic and aleatory risk that can be managed through the processes of program management.

Integrity: The conduct of Public Interest Programs demands the highest level of commitment to a culture of accountability, impartiality, ethical conduct, fiduciary responsibility, democratic virtues, and honesty.

The first level of accountability resides in the conduct of the program manager, who is the locus of integrity within the program management office. This requires a focus on the duties the position demands as a representative of the Government of the United States. Furthermore, the program manager must ensure that the program team operate within the constraints established by the program’s or project’s contractual commitments, and that it continues to work to meeting the program goals that align with the stated interests and goals of the organization. That these duties are exercised regardless of self-interest is the basis of integrity.

This is not an easy discipline, and individuals oftentimes cannot separate their own interests from those of their duties. Yet, without this level of commitment, the legitimacy of the program office and the governmental enterprise itself is threatened.

In prior years, as an active-duty Supply Corps officer, I came across cases where individuals in civil service or among the commissioned officer community confused their own interests—for promotion, for self-aggrandizement, for ego—with those duties demanded of their rank or position. Such confusions of interests are serious transgressions. With contracted-out positions within program offices adding consulting and staffing firms into the mix, with their oftentimes diversified interests and portfolios, an additional layer of challenges is presented. Self-promotion, competition, and self-dealing have all too often become blatant, and program managers would do well to enforce strict rules regarding such behavior.

The pressures of exigency are oftentimes the main cause of the loss of integrity of the program or project. Personal interrelationships and human resource management issues can also undermine good order and discipline necessary for the program or project to organize itself into a cohesive, working team that is focused on a common vision.

Key elements mentioned in our opening thesis regarding ethical conduct, adherence to democratic virtues which include acceptance of all members of the team regardless of color, ethnicity, race, sexual identity, religion, or place of national origin. People deserve the respect and decency deriving from their basic human rights to enjoy human dignity, as well as of their position. Adding to these elements include honesty and the willingness to accept and report bad news, which is essential to integrity.

An organization committed to the principle of accountability will seek to measure and ensure that the goals of the program or project are being met, and that ameliorative measures are taken to correct any deficiencies. Since these efforts oftentimes involve years of effort involving significant sums of public monies, fiduciary integrity is essential to this characteristic.

All of these elements can and should exist in private, commercial practices. The difference that makes this a unique characteristic to program management in the public interest is the level of scrutiny, reporting, and review that is conducted: from oversight agencies within the Executive Department of the government, to the Congressional oversight, hearing and review processes, agency review, auditing and reporting, and inquires and critiques by the press and the public. Public interest program management is life in a fishbowl, except in the most secret efforts, and even those will eventually be subject to scrutiny.

As with a U.S. Navy ship that makes a port of call in a foreign country, the actions of the conduct of crew will not only reflect on themselves or their ship, but on the United States; so it is also with our program offices. Thus, systems of programmatic governance and business management must anticipate in their structure the level of adherence required. Given the inherent level of risk involved in these efforts, and given the normal amount of error human systems create even with good intentions and expertise, establishing a system committed to the elements of integrity creates a self-correcting one better prepared to meet the program’s or project’s challenges.

Leadership: Programs in the Public Interest differ from equivalent commercial efforts in that management systems and incentives based on profit- and shareholder-orientations do not exist. Instead, a special kind of skillset is required that includes good business management principles and skills combined with highly developed leadership traits.

Management skills tend to be a subset of leadership, though in business schools and professional courses they tend to be addressed as co-equal. This is understandable in commercial enterprises that focus on the capitalistic pressures regarding profit and market share.

Given the unique pressures imposed by the elements of integrity, the program manager and the program team are thrown into a situation that requires a focus on the achievement of organizational goals. In the case of program and project management, this will be expressed in the form of a set of “framing assumptions” that roll into an overarching vision.

A program office, of course, is more than a set of systems, practices, and processes. It is, first and foremost, a collection of individuals consisting of subject matter experts and professionals who must be developed into a team committed to the vision. The effort to achieve this team commitment is one of the more emotional and compelling elements that comprise leadership.

Human systems are adaptive ones, complex, which react and are created by both incentives and sanctions. Every group, especially involving creative and talented people, starts out being a collection of individuals with the interrelations among the members in an immature state. Underlying the expression of various forms of ambition and self-identification among mature individuals is the basic human need for social acceptance, born from the individual personal need for love. This motivation exists psychologically in all individuals except for sociopaths. It is also the basis for empathy and the acceptance of the autonomy of others, which form the foundation for team building.

The goal of the leader is to encourage maturity among the members of the group. The result is to create that overused term “synergy.” This is accomplished by doing those things as a leader necessary to develop members of the group that fosters trust, acceptance, and mutual respect. Admiral James L. Holloway, Jr., in his missive on Naval Leadership, instructed his young officers to eschew any concept of perfectionism in people. People make mistakes. We know this if we are to be brutally honest about our own experiences and actions.

Thus, intellectual honesty and an understanding on what motivates people within their cultural mores, above all else, is essential to good leadership. Americans, by nature, tend to be skeptical and independently minded. They require a level of explanation and due diligence that is necessary to win over their commitment to a goal or vision. When it comes to professionals operating within public service in government—who take an oath to the Constitution and our system of laws—the ability to lead tends to be more essential than just good management skills, though the latter are by no means unimportant. Management in private enterprise assumes a contentious workplace of competing values and interests, and oftentimes fosters it.

Program and project management in the public interest cannot succeed in such an environment. It requires a level of commitment to the goals of the effort regardless of personal values or interests among the individual members of the team. That they must be convinced to this level of commitment ensures that the values of leadership not only operate at the top of the management chain, but also at each of the levels and lateral relationships that comprise the team.

The shorthand for leadership in this culture is that the leader is “working their way out of their job,” and “that in order to be a good leader one must be a good follower,” meaning that all members of the team are well-informed, that their contributions, expertise and knowledge is acknowledged and respected, that individual points of failure through the irreplaceable person syndrome are minimized, and that each member of a team or sub-team can step in or step up to keep the operation functioning. The motivating concept in these situations are the interests of the United States, in lieu of a set of stockholders or some fiduciary reward.

Finally, there is the concept of the burden of leadership. Responsibility can be can be delegated, but accountability cannot. Leadership in this context entails an obligation to take responsibility for both the mission of the organization and the ethical atmosphere established in its governance.

Oversight: While the necessity for integrity anticipates the level of accountability, scrutiny, oversight, and reporting for Programs in the Public Interest, the environment this encompasses is unique compared to commercial entities.

The basis for acquisition at the federal level resides in the Article Two powers of the president as the nation’s Chief Executive. Congress, however, under its Article One powers, controls appropriations and passes laws related to the processes, procedures and management of the Executive Branch.

Flowing from these authorities, the agencies within the federal government have created offices for the oversight of the public’s money, the methods of acquisition of supplies and services, and the management of contracts. Contracting Officers are given authority through a warrant to exercise their acquisition authority under the guidance and management of a senior acquisition authority.

Unlike in private business, the government operates under the concept of Actual Authority. That is, no one may commit the government except those possessing a warrant. Program Managers are appointed to provide control and administration of cost type efforts, especially those containing R&D, to shepherd these efforts over the course of what usually constitutes a multi-year effort. The Contracting Officer and/or the senior acquisition authority in these cases will delegate contract administration authority to the Program Manager. As such, it is a very powerful position.

The inherent powers of the Executive Branch and the Legislative Branches of government create a tension that is resolved through a separation of powers and the ability of one branch to—at least in most cases—check the excesses and abuses of the other: the concept of checks and balances, especially through the operation of oversight.

When these tensions cannot be resolved within the processes established for separation of powers, the third branch of government becomes involved: this is the Judicial Branch. The federal judiciary has the ability to review all laws of the United States, their constitutionality, and their adherence to the letter of the law in the case of statute.

Wherever power exists within the federal government there exists systems of checks and balances. The reason for this is clear, and Lord Acton’s warning about power corrupting and absolute power corrupting absolutely is the operational concept.

Congress passes statutes and the Judiciary interprets the law, but it is up to the Executive Branch through the appointed heads of the various departments of government down through the civil service and, in the case of the Department of Defense, the military chain of command under civilian authority, to carry out the day-to-day activities in executing the laws and business of the government. This creates a large base of administrative law and procedure.

Administrative Law and the resulting procedures in their implementation come about due to the complexities in the statutes themselves, the tests of certain provisions of the statutes in the interplay between the various branches of government, and the practicalities of execution. This body of law and procedure is oftentimes confused with “regulation” in political discussions, but it is actually the means of ensuring that the laws are faithfully executed without undue political influence. It is usually supplemented by ethical codes and regulations as well.

As a part of this ecosystem, the Program in the Public Interest must establish a discipline related to self-regulation, due diligence, good business practice, fiduciary control, ethical and professional conduct, responsibility, and accountability. Just as the branches of the federal government are constructed to ensure oversight and checks-and-balances, this also exists with normative public administration within the Executive Branch agencies.

This is often referred to both positively and, mostly among political polemicists in the negative, as the bureaucracy. The development of bureaucracies in government is noted by historians and political scientists as an indication of political stability, maturity, and expertise. Without bureaucracies, governments tend to be capricious and their policies uncertain. The practice of stare decisis—the importance of precedent in legal decisions—is also part and parcel of stability. Government power can be beneficial or coercive. Resting action on laws and not the whims or desires of the individual person is essential to the good order and discipline of the federal government.

As such, program and project managers, given the extensive latitude and inherent powers of their position, are subject to rigorous reporting, oversight, and accountability regimes in the performance of their duties. In R&D cost-type program and project management efforts, the risk is shared between the supplier and the government. And the government flows down this same regime to the contractor to ensure the integrity of the effort in the expenditure of public monies and under the performance and delivery of public contacts.

This leads us to the last important aspect of oversight: public scrutiny, which also includes the press as the Fourth Estate. When I was a young Lieutenant in the Navy working in contracts the senior officer to whom I was assign often remarked: “Never do anything that would cause you to be ashamed were it to end up being read by your grandmother in the Washington Post.”

Unlike private business where law, contractual obligation, and fiduciary responsibility are the main pressures on tolerated behavior, the government and its actions are—and must be—under constant public scrutiny. It is expected. Senior managers who champ against the bit of this check on official conduct misunderstand their role. Even the appearance of malfeasance or abuse can cause one to steer into the rocks and shoals.

Subject Matter Expertise: Given the interrelated characteristics of legality, governance, complexity, integrity, leadership, and oversight—linked to the development of a professional, permanent bureaucracy acting through a non-partisan civil service—the practices necessary to successfully shepherd such efforts has produced areas of expertise and specialization. These areas provide a basis for leveraging technology in gaining insight into meeting all of the requirements necessary to the good administration and control of Program Management in the Public Interest.

The structures and practices of program and project management are reflected in the private economy. Some of this is contractually prescribed and some of it is based on best business practice learned through hard experience. In the interplay of government and industry, most often an innovation in one has been refined and improved in the other, only to find its way back to practice on the originating “side” of the transaction.

Initially in our history this cross-fertilization occurred through extraordinary wartime measures: standardization of rifled weaponry passed down by Thomas Jefferson and Eli Whitney, and for railroad track gauge standards issued by the Union government during the Civil War, are just two examples that turned out to provide a decisive advantage against laissez faire and libertarian approaches.

As the complexity of private business concerns, particularly in the international sphere, began to mimic—and in many cases surpass—the size and technical complexity of many individual government efforts, partnerships with civil authorities and private businesses saw the need for industry standardization for both electrical and non-electrical components and processes. The former was particularly important in the “Current Wars” between Edison and Westinghouse.

These simple and earlier examples highlight the great conundrum of standardization of supply, practice and procedure in acquisition: the need for economy through competition of many sources for any particular commodity or item weighed against the efficiency and interoperability needed to continue operations. Buying multiple individual items with the same function but produced using differing standards creates a nightmare of suboptimization. Overly restrictive standards can and have had the effect of reducing competition and stifling innovation, especially if the standard is proprietary.

In standards setting there are several interests involved that must be taken into account: the technical expertise (technical, qualitative, etc.) that underlies the standard, the public interest in ensuring a healthy marketplace that rewards innovation, diversity, and price competitiveness, the need for business-to-business cooperation and synergy in the marketplace, and the preponderance of practice, among others. In the Defense industry this also includes national security concerns.

This last consideration provides an additional level of tension between private industry and government interests. In the competition for market share and market niches, businesses are playing a zero-sum game that shifts between allies and competitors. Still, the interest of individual actors is focused on making a proprietary product or service dominant in the target market.

Government, on the other hand, particularly one that operates as a republic based on democratic processes and virtues and a commitment to equal rights, has a different set of interests that are, in many cases, diametrically opposed to those of individual players in the marketplace. Government needs and desires a broad choice of sources for what it needs, while ensuring that qualitative standards are met under a fair and reasonable price. When it does find innovation, it seeks to reward it, but only for the limited terms, conditions, and period of the contractual instrument.

The greater the risk in these cases—especially when cost risk is shared—the greater the need for standards, especially qualitative ones. The longer the term of the effort, the greater the need for checks and balances through evaluation, review, and oversight. The greater the dollar value, the greater importance for fiduciary and contractual accountability.

Thus, subject matter expertise has evolved over time, aligned with the functions and end items being developed and delivered. These areas include:

Estimating – A critical part of program and project management, this is a discipline with highly specialized quantitative methods for estimating and projecting project costs, resources, and duration. It is part of the planning phase prior to program or project inception. It can be used to support budget planning prior to program approval, during negotiations and, after award, to inform the project plan.

Systems Engineering – as described by the International Council of Systems Engineering, “a transdisciplinary and integrative approach to enable the successful realization, use, and retirement of engineered systems, using systems principles and concepts, and scientific, technological, and management methods.”

As it relates to program and project management, the technical documents related to providing the basis and structure of the lifecycle management of the end item application, including the application of technical standards, measures of effectiveness, measures of performance, key performance parameters, and technical performance measures. In simplistic terms, systems engineering defines when the item under R&D reaches the state of “done.”

Financial Management – at the program and project management level, the planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds to adhere to the limitations of law and consistent with the terms and conditions of the contract and the its ancillary planning and execution documents.

At its core, financial management within this discipline includes the planning, programming, budgeting, and execution process for the financial requirements of successful program execution. As with any individual enterprise, cashflow for required activities with the right type of money determined by Congressional appropriation presents a unique and specialized skillset under program management in the public interest. Oftentimes the lack of funds necessary to address a particular programmatic risk or challenge can be just as decisive to program execution and success as any technical challenge.

Risk and Uncertainty – the concept of risk and uncertainty have evolved over time. Under classical economics (both Keynes and Knight), risk is where all of the future events and consequences of an action are known, but where specific outcomes are unknown. As such, probability calculus is applied to determine the risk management: mitigation and handling. Uncertainty, under this definition, is unknowable events that will result from our actions and is implicit in human action. There is no probability calculus or risk buy-down that can address areas of uncertainty. These definitions are also accepted under the concept of complexity economics.

My good colleague Glen Alleman (2013) at his blog, Herding Cats, casts risk as a product of uncertainty. This is a reordering of definitions, but not unuseful. Under Glen’s approach, uncertainty is broken into aleatory and epistemic uncertainty. The first—aleatory—comes from a random process, what Keynes, Knight, et al. would define as classical uncertainty. The second—epistemic—comes from lack of knowledge. The first is irreducible, which is consistent with classical economics and complexity economics; the second is subject to probability analysis and risk handling methodologies.

Both risk and uncertainty—aleatory and epistemic—occur within all phases and under each discipline within the project management environment. Any human action involves these forces of cause-and-effect and uncertainty—and limit our actions under the concept of “free will.”

Planning and Scheduling – usually these have been viewed as separate entities, but they are, in fact, part of a continuum, as are all of the disciplines mentioned, but more on that later in these blogs.

Planning involves the ability to derive the products of both the contract terms and conditions, and the systems engineering process. The purpose is to develop a high-level, time-phased plan that captures program events, deliverables, requirements, significant accomplishment criteria, and basic technical performance management achievement that will be the basis for a more detailed integrated master schedule.

The scheduling discipline is tasked with further delineating the summary tasks into schedule activities based on critical path methodology. A common refrain when I worked on the government side of program management was that you cannot eat an elephant in one gulp: you have to eat it one piece at a time.

As it relates to this portion of project methodology, I have, over the years, heard people say that planning and scheduling is more of an art instead of a science. Yet, the artifacts upon which our planning documents rest exist as part of the acquisition process and our systems and procedures are mature and largely standardized. The methods of systems engineering are precise and consistent.

The lexicon of planning and scheduling, regardless of the software applications or manual methods used, describe the same phenomenon and concepts, despite slightly different—and oftentimes proprietary—terminology. The concept of critical path analysis is well documented in the literature with slight, though largely insignificant, differences in application.

What appears as art is, in reality, a process that involves a great deal of complexity because these are the documents upon which all of the moving parts of the program are documented. Rather than art, it is a discipline that requires attention to detail and collaboration, aside from the power of computing.

Resource Management – as with planning and scheduling, resource management consists of a detailed accounting of the people, equipment, monies, and suppliers that are required to achieve the activities detailed in the program schedule.

In the detailed and specialized planning of projects and programs in the public interest, these efforts are cross-referenced and further delineated to the actual work that needs to be completed. A Work Breakdown Structure (or WBS), is the method of time-phasing the work using detailed tasks that integrate scope, cost, and schedule at the lowest level of achievement.

Baselining and Performance Management – are essential for project control in this environment. In this case, project and program schedule, cost, and resources are (ideally) risk adjusted and a performance management baseline is established: the basis for the assessment and control of the project.

This leads us to the methodology that is always on the cusp of being the Ozymandias of program management: earned value management or EVM. The discipline of EVM arose out of the Space Age era of the 1960s. The premise is simple: when undertaking any complex effort there is a finite amount of money and resources, and a target date for the needed end item. We need a method to determine whether the actual work performed in terms of budgeted resources and time is tracking to the plan to produce the desired end item application.

When looking at the utility of EVM, one must ask: while each of the disciplines noted above also track achievement over the lifecycle of the project or program, do any combine an analysis against budgeted time and resources? The answer is no, and so EVM is essential to management of these efforts.

Still, our other disciplines also track important information that is not captured by EVM. Thus, the entire corpus of our disciplines represents the project and program ecosystem. These processes, procedures, and the measures derived from them are interconnected. It is this salient fact that points us in the direction regarding the future of program management.

Conclusions from Part One

Given that we have outlined the unique and distinctive characteristics of public interest program management, the environment and basis upon which such program management rests, and the highly developed disciplines that have evolved as a result of the experience in system development, deployment, and lifecycle management, our inquiry must next explore the evolutionary nature of the program organization itself. Once identified and delineated, we must then determine the place of program organization within the context of developments in systems and information theory which will give us insight into the future of program management.