Federal Aviation Administration

PLAN FOR IMPROVEMENT
IN THE
GAO HIGH RISK AREA OF
FAA MODERNIZATION PROGRAM

Updated as of
August 2008

High Risk: FAA Modernization Program

Planning Document

OMB Contact: Kimberly P. Nelson (202) 395-3787

FAA Owner: Dave Bowen (703) 493-4570

FAA Contact: Bob Rovinsky (202) 493-4019
- Chuck Weigl (202) 267-3665

GAO Contacts: David Powner (202) 512-9286
- Colleen Phillips (202) 512-6326
Gerald Dillingham (202) 512-4803
- Taylor Reeves

Scope: Federal Aviation Administration (FAA) programs to modernize the air traffic control (ATC) system - emphasis on improving the FAA’s capabilities in the areas of acquisition management, enterprise architecture, cost accounting, estimation, investment management, human capital, and the deployment of ATC systems.

Overall: Improve, via an agency-wide coordinated approach, the ability to identify, build, and field air traffic control systems in a timely, cost-effective and technically effective and efficient manner. This supports FAA’s long-term goal of transforming the ATC system by implementing the Next Generation Air Transportation System (NexGen) by 2025. This also supports FAA’s goals of ensuring that 90% of its major system acquisitions are within ten percent of cost and schedule milestones.

Focus areas:

1. Acquisition Processes and Capabilities:

• Institutionalize best practices and/or improved system management capabilities on all new major programs

2. Enterprise Architecture (EA):

• Implement and enforce a complete EA
  

3. Cost Estimating/Accounting:

• Improve cost estimating and cost accounting practices, and achieve a “clean financial audit”

4. Information Technology (IT) Investment Processes

• Integrate IT investment management best practices across the agency

5. Human Capital

• Maintain and grow the technical and contract management expertise needed to define, implement and integrate numerous complex programs and systems

6. Deployment

• Continue to maintain a track record of meeting our planned deployment targets

Process:

1. Establish a project milestone list based upon GAO recommendations, and in coordination with GAO, the Department of Transportation (DOT), and the Office of Management and Budget (OMB), and get it approved by GAO.
2. Gather status of action items, deliverables, and activities and provide:
   1. Executive Manager biweekly updates on issues and action items raised in monthly update to Executive Management Team.
   2. Executive Management Team (FAA’s Chief Financial Officer (CFO), Chief Information Officer (CIO), Federal Acquisition Executive, and Air Traffic’s Vice President for Finance) monthly updates on expected versus actual deliverables, validation of product deliverables, and any new or on-going issues or risks.
   3. FAA Administrator and Management Board receives monthly updates on progress and quarterly updates just prior to GAO quarterly update.
   4. GAO and OMB quarterly updates on deliverables and proof of validation.
   5. Special reports to GAO and OMB as requested.
3. Objectively review, via an internal audit function, work products/deliverables to provide appropriate level validation that the documentation/deliverable is available to satisfy GAO review requirements.
4. Monitor schedules and accomplishments and provide regular reporting as depicted above; identify risks; implement risk mitigation strategies; identify issues – track to closure, etc.

Responsible Organizations:

The Deputy (now Acting) FAA Administrator assigned an Executive Management Team, headed by the FAA CIO, to develop a plan and ensure implementation. The following organizations and senior officials are responsible for the identified focus areas:

1. Acquisition Processes and Capabilities – Air Traffic Organization (ATO), Vice President for Acquisition and Business Services
2. Enterprise Architecture – ATO, Director, Systems Engineering and Safety
3. Cost Estimating – ATO, Director of Investment Planning and Analysis
4. Cost Accounting – Assistant Administrator for Financial Services / CFO
5. IT Investment Processes – Assistant Administrator for Information Services/ CIO
6. Human Capital – ATO, Director, Leadership & Professional Development
7. Deployment – ATO, Director of Capital Expenditures Programs

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Metrics and Baselines:

FAA developed an extensive list of milestones and deliverables to measure progress improving its ability to identify, build, and field ATC systems in a timely and cost-effective manner. These milestones and deliverables are shown in attachments A and B. FAA is working to make substantial progress in “institutionalizing best practices, in developing a record of deployments of air traffic systems, and in responding to earlier audit findings.

Methodology for Evaluation:

Monthly meetings are conducted in conjunction with the Flight Plan review to measure and report progress to the FAA Administrator and his Management Board. The Executive Management Team, consisting of the CIO, CFO, FAA Acquisition Executive, and ATO Financial Vice President, meet monthly to monitor progress and address issues and risks. The overall program coordinator provides an objective review of selected deliverables and work products. Finally, independent groups are also used on selected deliverables and work products. Validation results are reported as a separate data item on the monthly scorecard along side of the initiative lead evaluation.

Acquisition Processes and Capabilities

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organization: ATO, Vice President for Acquisition and Business Services

Assisting Organizations:
- ATO, Technical Operations Services
- ATO, Operations Planning Services, Technical Strategies and Integration

Description: Implement improved acquisition processes in the areas of measurement and analysis, verification and validation, quality assurance, risk management, contractor management, program management, and requirements on selected pilot programs. Additionally, develop and implement an approach for institutionalizing processes across the ATO for all new programs.

Expected Outcomes:

• Selected in-process major programs and all new acquisition programs follow a standard acquisition management process based on industry best practices.
• Institutionalize compliance assessment capability.

Accomplishments:
Jul 2006: Completed the plan setting ATO priorities for process improvement. Identified all acquisition processes that would be included in the effort (total of eight).
Oct 2006: Closed remaining gaps in the process capabilities of four ATC programs using elements of the industry approved Capability Maturity Model (CMMI) to measure progress. Began confirming process capability improvements through internal periodic assessments.
Jun 2007: Implemented quality assurance, measurement and analysis, and verification for eight major national airspace system (NAS) programs. Reviewed and gained concurrence from ATO Executive Council on institutionalization of the approach and activities for institutionalizing acquisition management.
Jul 2007: Prioritized practices for institutionalization and developed timeline.
Aug 2007: Chartered integrated practice teams.
Nov 2007: Implemented risk management, contractor management, program management, and requirements processes across eight major ATC programs.
Dec 2007: Developed and integrated quality assurance and risk policy, process, procedures, information into the FAA standard Acquisition Management System (AMS) found on its website (FAST).
Mar 2008 Established a compliance assessment approach and began implementation of same. Developed and integrated contractor management, measurement and analysis policy, process, and procedures information into the FAA AMS.
Jul 2008 Document Intensive Reviews completed on five new programs: ATOP, TFM, NNEW, WAAS, and ADS-B.
Aug 2008 Executive-level briefings provided on six programs’ implementation of acquisition processes and capabilities: NNEW, IFPA, IDS-B, NEXCOMM, DataComm, and SWIM.

Milestones:
Sep 2008: Complete integration of verification and validation policy, process, procedures, and information in FAST.
Sep 2008: Implement the seven best practices in seven new programs: Automatic Dependent Surveillance Broadcast (ADS-B), DataComm, NNEW, System Wide Information Management (SWIM), IFPA, Runway Status Lights, and Training Simulators.
Sep 2008: Implement new validation and verification process.

Impediments/Challenges:

• Aggressive scheduling of improvement efforts conflicting with similarly aggressive program schedules (that were developed prior to the improvement plan).

Metrics:

Remarks:

Enterprise Architecture

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organization: ATO, Director, Systems Engineering and Safety

Assisting Organizations: CIO’s Chief Technology Office

Description: Implement and enforce a complete enterprise architecture (EA). A complete enterprise architecture is useful because it provides an enterprise-wide view of well our investments are meeting our business needs, as well as guiding our future investments.

Expected Outcomes:

• Achieve Stage 3 of the GAO EA Maturity Model.

Accomplishments:
Dec 2006: Developed AMS changes that integrate EA within system acquisition. Integrated the Next Generation Air Transportation System (NGATS) requirements into the FAA's EA.
Apr 2007: Approved FAA architectural project management plan and configuration management process.
Sep 2007: Fully implemented the Department of Defense Architecture Framework (DODAF) and fully populated all selected views.
Dec 2007: Independent validation and verification (IV&V) completed on Non-NAS EA.
Mar 2008 IV&V completed on NAS EA.
Aug 2008 Selected and procured “best in class” EA tool.

Milestones: No additional. Program reports effort as completed.

Impediments/Challenges: None.

Metrics:

Remarks:

• Awaiting final IV&V report from MITRE.
• The EA is maturing well. EA is a living process—not simply a document—and, as such, is never “finished.”
  

Cost Estimating / Accounting

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organizations:
- ABA, Assistant Administrator for Financial Services/CFO
- ATO, Director of Investment Planning and Analysis

Description: Improve cost estimating and cost accounting practices and obtain a “clean financial audit.”

Expected Outcomes:

• Publish and implement a lifecycle cost model that will be used with all major investments based on a database of historical cost estimates.
• Implement quarterly reporting on the status of programs staying within annual cost targets at Flight Plan reviews.
• Obtain a clean audit of our financial statements for fiscal year (FY) 2007 and lift the qualification of the FY-06 statements.

Accomplishments:

Dec 2006: - Incorporated cost estimating and documentation guidance into the FAA’s acquisition management system AMS.

• Cost accounting data is available in the FAA’s cost accounting system (CAS) to implement tracking of the costs of the Air Traffic Control (ATC) system by service area and system.
• Implemented quarterly reporting on the status of programs staying within annual cost targets at Flight Plan reviews.

Sep 2007: - Published life cycle cost model based on database of historical cost estimates.

• Published recommended course list for cost estimating based on cost estimating core competencies.
• Published four cost estimating guidelines.
• Delivered at least four cost estimating training courses to headquarter and regional personnel.

Nov 2007: Audit report lifted the qualifications from 2006 but identified a material weakness for 2007.
Feb 2008: Improved the timeliness of cost accounting system (CAS) reports delivered to users to within 38 days of the end of the quarter.
Mar 2008: Improved the processes for accrual of expenses. ATO is performing accruals on a monthly basis.

Milestones:

Sep 2008: Obtain a clean audit of our financial statements for FY-08

Impediments/Challenges: None.

Metrics:

Remarks:

The clean audit of financial statements is dependent on receiving a “clean” opinion on an audit of our financial systems by KPMG.

IT Investment Processes

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organization: Assistant Administrator for Information Services/CIO

Assisting Organizations:

• Assistant Administrator for Financial Services/CFO
• ATO, Investment Planning and Management Group
• ATO, Financial Services

Description: Implement and enforce stage 3 of the GAO’s Information Technology Investment Maturity (ITIM) model, a summary of best practices for investing in information technology. The model allows agencies and GAO to assess to what degree of maturity (from stage 1, the lowest) to stage 5 (the highest) agencies are following these best practices. To date, no agency has been assessed at stage 3 or higher.

Expected Outcomes:

• Establish a process for the FAA’s investment review board, the Joint Resources Council (JRC), and subordinate boards, to regularly review the performance of IT systems throughout their lifecycles and take corrective actions when expected performance is not being met.
  • Define and implement an IT investment management structure, including an investment management board and a disciplined process for managing all non-NAS investments.
  • Define and implement processes for managing major investments as part of an enterprise-level portfolio.
  • Achieve Stage 3 of the GAO Information Technology Investment Management (ITIM) Framework.

Accomplishments:

Apr 2006: IT Executive Board (ITEB) Charter approved by JRC.
Dec 2006: - Post implementation reviews (PIRs), policy and process, included in our acquisition management system (AMS) policy and guidance.

• Validated the extent to which all major NAS modernization projects were compliant with American National Standards Institute (ANSI) EVM standards.

Mar 2007: Developed remediation plans to address findings, as appropriate, identified during ANSI EVM review.
Sep 2007: Modified our acquisition management system (AMS) to require operational assets to develop and maintain project management plans approved by the investment board (JRC or subordinate board).
Nov 2007: JRC delegated responsibility for ITEB portfolio.
Jan 2008: Documented and approved ITEB investment management process.
Jan 2008: “Go to Green” Tiger Team formed to produce an action plan to achieve most of the stage 3 requirements of the GAO ITIM model this year.
Feb 2008: Conducted training for ITEB board on approved investment process.
Feb 2008: Completed processes for instituting the ITEB.
Mar 2008: “Go to Green” Plan for Stages 2 and 3 developed and approved.
May 2008: Conducted Operational Analyses and budget verification on top 29 investments in ITEB portfolio (92 percent of portfolio dollar value).
May 2008: JRC approved ITEB portfolio.
Jun 2008: JRC approved Investment Selection Criteria.
Jun 2008: Implement process of Meet Business Needs. (ITEB)
Jun 2008: Capture Investment Information. (ITEB)

Milestones:

JRC:
Jul 2008: Approve and publish AMS portfolio management policy and initial portfolio criteria
Oct 2008: Update Roadmap guidance
Nov 2008: Update Service Level Review
Dec 2008: Integrate budget and portfolio management
Dec 2008: Conduct Post Implementation Reviews

ITEB:
Sep 2008: Select IT Investments
Oct 2008: Define Portfolio Criteria
Nov 2008: Evaluate the Portfolio
Dec 2008: Create the Portfolio
Dec 2008: Provide Investment Oversight
Dec 2008: Conduct Post Implementation Reviews

Impediments/Challenges: Meet defined/agreed to schedules and activities.

Metrics:

Remarks:

• While there remains considerable work that needs to be accomplished in this area, we have seen significant movement towards meeting our goals and expect the ITEB Investment Management effort to turn “green” and the JRC effort to turn “yellow” by September 2008. The JRC effort has an approved schedule now, and if dates are met, could turn “green” by late January 2009.

Human Capital

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organization: ATO, Director, Leadership & Professional Development

Assisting Organizations: ATO, Operations Planning Administration Office

Description: Overcome human capital challenges including how to develop the technical and contract management expertise needed to define, implement, and integrate FAA’s numerous complex programs and systems.

Expected Outcomes:

• Contracting professionals have required training and skill sets and the FAA has sufficient “bench strength” to meet future needs.
• Program/Project managers are certified according to standards set by the Project Management Institute (PMI) and assigned in accordance with OMB and related agency documented policy and processes.

Accomplishments:

Jun 2007: Participated in a Contracting Professional Skills Assessment in conjunction with the Office of Federal Procurement Policy/Federal Acquisition Institute.
Jun 2007: Qualifying standards established and implemented for program managers (PMs) on major programs and capital investment projects (CIP) $50 million and above.
Jun 2007: Awarded contract to the National Academy of Public Administration (NAPA) to form panel of external experts & conduct an independent, impartial assessment of the agency’s capabilities to support the Next Generation of Air Traffic Systems (NextGen).
Jul 2007: Completed assessment/gap analysis of agency contracting professional skills and "bench strength".
Sep 2007: Developed a strategy and implementation plan to close gaps identified in the contracting professional agency skills analysis.
Dec 2007: Developed an FAA Project and Program Manager Career Path and associated PM career development and certification policy.
Jan 2008: Developed an agency strategy for recruiting, selecting & assigning PMs to CIPs.
Jan 2008: Developed an audit process to evaluate organizational compliance to established PM policy and guidance.
Feb 2008: Received Office of Personnel Management approval to use reemployed annuitants to fill contracting vacancies.
May 2008: Developed interim action plan to address NAPA’s Phase 1 findings.

Milestones:

Feb 2009: Finalize action plan and develop implementation schedule to address final report of findings.

Impediments/Challenges: None.

Metrics:

Remarks:

Deployment

Goal: Improve the FAA’s ability to identify, build, and field air traffic control systems in a timely and cost-effective manner through institutionalizing acquisition management best practices and meeting our targets to deploy air traffic control systems.

Lead Organization: ATO, Director of Capital Expenditures Programs

Assisting Organizations: AIO, Office of IT Enterprise Services, IT Program and Portfolio Services Division

Description: Improve the ability of FAA to estimate, plan, and meet target cost and schedule for major programs.

Expected Outcomes:

• Earned value management implemented for all major acquisitions.
• Breach reporting (cost or schedule variance greater than 5 and 10%) implemented.

Note that the FAA also has a related outcome, published in its Flight Plan and tracked monthly by the Administrator, of keeping all its acquisitions within 10% of cost, schedule, and performance goals.

Accomplishments:

Jun 2007: Program segments approved in smaller segments.
Jun 2007: Established Service Level Review process for FAA’s senior investment review board, i.e., the JRC.
Jun 2007: Developed and incorporated EVM policy and guidance into the FAAs Acquisition Management System (AMS) and provide EVM training/awareness to all major programs and executives involved in acquisition decisions.
Jul 2007: Program performance portfolio metrics reviews performed.
Jul 2007: Developed a set of performance metrics for the non-major IT investments in the "IT Portfolio" to be reported to the ITEB.
Aug 2007: Conducted an independent certification to validate progress to date and identify gaps to full institutionalization of EVM.
Sep 2007: Developed a method for ensuring that the ATO Executive Council (EC) conducts reviews (as documented in the ATO EC operating procedures) for programs that breach cost or schedule by 5% or more.
Sep 2007: Automated Program Performance Metrics and reporting process in the Simplified Program Information Reporting and Evaluation (SPIRE) tool.
Sep 2007: Developed guidance/monitored implementation of Integrated Baseline Reviews.
Dec 2007: All Major programs which were assessed in April 2005, and are still in development, are in full compliance with EVM ANSI Standards..
Dec 2007: Developed and implemented EVM Surveillance and Certification processes.
Dec 2007: Conducted strategic reviews on 22 of the 30 major programs.
Jul 2008: Developed and provided GAO with deployment schedules and associated milestones for 15 agreed upon major programs.

Milestones:

Jul 2008: Develop a Standard Operating Procedure and post for ATO Program Control and Baseline Management to address Program Planning, Baseline Management, Program Performance Reporting, and Variance Analysis.

Impediments/Challenges: None.

Metrics:

Remarks:

Last updated: 9/30/2008