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The Acquisition Program Baseline (APB) Template _{(Revised 05/2000)}

• Summary of Changes

Using This Template

This template provides guidance for preparing the Acquisition Program Baseline. It supplements information found in Appendix B of the FAA Acquisition Management System (AMS). Text of the template that is italicized is intended to guide preparation of the APB. Non-italicized text defines the format and structure of the document (title page, table of contents, section headings and numbers, tables and titles).

About the Acquisition Program Baseline

The Acquisition Program Baseline serves two critical functions in the AMS. First, it is the mutual agreement between the provider organization and the user organization concerning (1) what the acquisition program will provide (performance baseline as defined by the Requirements Document), (2) the benefits that will accrue (benefits baseline), (3) what it will cost and the resources that will be provided (cost baseline), and (4) when the capability will be provided (schedule baseline).

Second, the Acquisition Program Baseline is the mutual agreement between corporate FAA (Joint Resources Council - JRC) and the provider (typically, the Integrated Product Team - IPT) concerning what each party will provide. The JRC commits to funding the program according to the profile in the cost baseline, and the IPT commits to providing baseline performance and benefits according to the schedule baseline.

The Acquisition Program Baseline is intended to define the cost, schedule, benefit, and performance boundaries for a singular acquisition program. At times, however, it may be more practical to gain approval of and manage closely related implementation efforts as segments within a single baseline. Examples would include a program or candidate solution that intends to implement a base capability and then add a significant product upgrade at a later date, or a complex and high-cost acquisition program consisting of several interrelated, but basically independent implementation efforts. In such cases, the cost, schedule, benefits, and performance associated with each segment is displayed separately in the appropriate section of the APB. Use common sense. If product software is to be developed and released in a sequence of planned builds to achieve an early base capability and minimize risk, the program or solution would typically not be segmented. Likewise, such program implementation phases as development, production, testing, and fielding are typically not segmented.

JRC-Controlled Parameters

Certain critical parameters within each baseline in the APB are designated for JRC control. These parameters define the boundaries of empowerment of the IPT during Solution Implementation and In-Service Management of an acquisition program. They relate to corporate FAA's commitment to satisfying the mission need, achieving needed operational capability, achieving benefits, and meeting the schedule requirements of interdependent programs. JRC controls are identified during investment analysis by the Investment Analysis Team, and are approved at the Investment Decision by the Joint Resources Council. They are designated in the APB as bold, underlined text within each baseline.

Change Control

The AMS recognizes (1) the APB established at the Investment Decision is the best analytical estimate of cost, schedule, performance, and benefits at that time; (2) conditions and assumptions underlying these baselines may change over time; and (3) variances from baseline values may develop as a program matures. The IPT is responsible for identifying and managing these variances, reporting status periodically, and determining the effect of variance in one parameter of the baseline on other parameters (e.g., how do funding cuts or other changes to the cost baseline affect schedule, benefits, and performance?). When actual/projected variances from baseline values increase to the point at which the IPT determines a JRC­controlled parameter can no longer be achieved, the IPT must notify the JRC and provide a detailed analysis of the variance along with alternative courses of action the JRC could take.

In extreme cases, when the business case documented in the APB is no longer valid or when Congress or FAA fails to provide the funding specified in the cost baseline, the JRC may decide or the IPT may request that the program be rebaselined. The IPT develops the rebaseline request in conjunction with the sponsoring organization. This may involve a new investment analysis or reassessment of the original investment analysis. If the JRC does rebaseline the program, the revised APB becomes the baseline plan to be managed by the IPT. All previous APBs are retained as attachments to the current baseline.

Acquisition Program Baseline

[enter program name]

Change #

Approved by:     Signature           Date: ___________
(Acquisition Executive)

Approved by:     Signature           Date: ___________
(Associate Administrator,
Sponsoring Line Of Business)

Approved by:     Signature           Date: ___________
(Associate Administrator,
Performing Line of Business)

Federal Aviation Administration 800 Independence Avenue SW Washington, DC 20591

Acquisition Program Baseline

Table of Contents

1. Overview

6. Risk Management _{(Added 05/2000)}

1. Overview

Identify the Mission Need Statement addressed by the acquisition program or candidate solution defined in this Acquisition Program Baseline. Briefly describe the program or solution, including all segments (e.g., base program, planned product improvements) in this baseline for which approval is sought. Identify where this program or mission need is addressed in the NAS Architecture and agency R,E&D, F&E, and OPS planning documents.

2. Cost Baseline

The cost baseline defines the cost boundary within which the Integrated Product Team is authorized to execute an acquisition program over its entire lifecycle. It includes the full cost of acquisition and ownership of all products and services to be provided by the program, as well as the cost to dispose of replaced assets.

A cost baseline is developed during investment analysis for each candidate solution to mission need, and is recorded in the Investment Analysis Report. At the Investment Decision, the cost baseline of the candidate solution selected by the JRC for implementation becomes the funding profile for the acquisition program in agency planning, programming, and budgeting documents. For on-going acquisition programs being baselined for the first time or re-baselined, the cost baseline must include historical lifecycle costs as well as future lifecycle costs.^{Revised 7/98}

Use the format of Table 2.1 for the cost baseline. If a candidate solution or acquisition program will be implemented in segments, display the cost of each segment in separate tables. Tailor cost elements to be appropriate to the candidate solution or acquisition program. Use actual fiscal years when funding will be needed. Include the best estimates of cost for planned product upgrades that are intrinsic to the candidate solution or acquisition program. IPTs may request a revision to the cost baseline for product upgrades at a subsequent Investment Decision when costs are known more accurately. Note that many cost elements will be funded by a single appropriation (e.g., typically, there is no R,E&D funding for most cost elements). Also note that OPS funding should reflect what is required by the Integrated Product Team to implement and sustain the candidate solution or acquisition program throughout its intended lifecycle.

Highlight in bold, underlined text those cost elements designated for control by the Joint Resources Council. Total program funding by segment by appropriation (R,E&D, F&E, OPS) is a mandatory JRC cost control. Other cost elements may be designated for JRC control when cost, risk, program structure, or some other factor warrants such oversight. For example, the JRC may designate the cost of expensive or high-risk program activities (e.g., prototyping, software development) for JRC control. Undesignated cost parameters are managed by the IPT so long as no JRC control would be breached.

Table 2.1 Cost Baseline

Change (#)

(Then-year $M)

Place an asterisk next to each JRC control in the cost baseline that changed from the previous baseline. In a narrative paragraph following the table, explain the reason for the change(s) and provide the change date. Retain all previous baselines as attachments to the latest approved APB.

3. Schedule Baseline

The schedule baseline defines the schedule boundary within which an acquisition program or candidate solution must be accomplished. It contains events that are key to satisfying mission need, providing intended operational capability, and accruing benefits, as well as events crucial to other interrelated programs or NAS systems. The schedule baseline is established at the Investment Decision, and is extracted from the Investment Analysis Report for the candidate solution selected by the JRC for implementation. For on-going acquisition programs being baselined for the first time or re-baselined, the schedule baseline must include historical schedule events as well as future schedule events.^{Revised 7/98}

Be sure to consider all aspects of the acquisition program or candidate solution when designating events for the schedule baseline. For a complex acquisition program, the schedule baseline may include events relating to the acquisition of systems or equipment, purchase of real property, improvements to the physical infrastructure, modification of facilities, or switch over of operations and maintenance activities to the new capability. It may also include events that must occur external to FAA (e.g., equipage by the airlines) or actions that must be taken by other programs within FAA. Use Exhibit 1 as a guide.

Use the format of Table 3.1 to record baseline schedule events, and to define the criteria by which completion of those events will be judged. If a candidate solution or acquisition program will be implemented in segments, display schedule baseline events appropriate to each segment.

Highlight in bold, underlined text those schedule events designated for control by the Joint Resources Council. The JRC controls only those schedule events crucial to satisfying mission need, providing operational services, and accruing benefits. Undesignated schedule events are managed by the IPT so long as no JRC control would be breached. The following are examples of JRC schedule controls:

• Systems
  • Production/prime contract award
  • In-service decision
  • First site commissioned into operational use
  • Last site commissioned into operational use
• Facilities
  • Construction contract award
  • Site(s) commissioning
• Services
  • Contract award
  • Services start date

Table 3.1 Schedule Baseline

Change (#)

Place an asterisk next to each JRC control in the schedule baseline that changed from the previous baseline. In a narrative paragraph following the table, explain the reason for the change(s) and provide the change date. Retain all previous baselines as attachments to the latest approved APB.

4. Benefits Baseline

The benefits baseline quantifies the benefits the candidate solution or acquisition program is intended to achieve. The benefits baseline is established at the Investment Decision, and is extracted from the Investment Analysis Report for the candidate solution selected for implementation by the JRC. If a candidate solution or acquisition program will be implemented in segments, display the benefits for each segment in a separate table.

Define in column 1 of Table 4.1 the parameters that will drive benefits for this candidate solution or acquisition program. For the government, such benefit drivers might increase productivity, reduce operational or maintenance costs, improve safety or security, or produce non-labor savings, For the user, benefit drivers might reduce flight time, avoid capital costs, or lower operational costs. Define in column 2 the metric for determining whether the benefit has been achieved. Provide both a quantitative goal and a date for achieving the goal (see table for examples). For the remaining columns, list in then-year dollars the yearly flow of economic benefits anticipated to be derived from each benefit driver. Note that some benefit drivers may achieve important operational benefits and have no associated economic benefit that can be quantified reasonably (e.g., improvements in security or safety that are not quantifiable in dollar terms).

Events or actions that must occur to achieve intended benefits must be included in the schedule baseline along with the dates by which those actions must be taken. For example, if a rulemaking change must be implemented to obtain the benefit of lower operational costs, promulgation of the rulemaking change would be a baseline event in the schedule baseline. If a program or candidate solution contributes only a portion of an overall benefit, that portion should be indicated (e.g., contributes 40% of the flight time reduction goal).

Highlight in bold, underlined text those benefits designated for control by the Joint Resources Council. Total lifecycle economic benefit by segment is a mandatory JRC control. The JRC may also choose to control other benefits such as total lifecycle economic benefits for major benefit drivers. Undesignated benefit parameters are managed by the IPT so long as no JRC control would be breached.

It is essential to monitor the conditions and assumptions on which benefits are based to determine if changes have occurred that undermine the business decision to implement the program. For example, if airlines must equip aircraft to achieve operational savings and the rulemaking changes to require that equipage are not being executed, then action should be taken to remedy the problem or to revisit the Investment Decision if it is determined the necessary equipage is not going to take place.

Place an asterisk next to each value in the benefits baseline that changed from the previous baseline. In a narrative paragraph following the table, explain the reason for the change(s) and provide the change date. Retain all previous baselines as attachments to the APB.

Table 4.1 Benefits Baseline

Change (#)

(Provide information on changes from the previous baseline)

5. Performance Baseline (Requirements Document)

-- INSERT THE REQUIREMENTS DOCUMENT HERE --

The Requirements Document of the candidate solution selected for implementation by the JRC at the Investment Decision is the performance baseline for the acquisition program.

Highlight in bold, underlined text those requirements in the Requirements Document designated for control by the Joint Resources Council. The total number of units for system production, the number of facilities and/or sites to be constructed, or the total level of services to be provided are mandatory JRC controls, as appropriate for the specific acquisition program. The JRC also controls those requirements most critical to (1) achieving operational effectiveness and suitability, (2) meeting the needs of dependent elements of the NAS, (3) accruing benefits ascribed to the acquisition program, and (4) those with the greatest risk for cost or schedule growth. As a rule of thumb, the JRC controls no more than 10 - 20 requirements across all sections of the Requirements Document. Undesignated performance parameters are managed and controlled by the IPT and sponsor so long as no JRC control would be breached.

As with the other baselines of the APB, the impact of changes to the Requirements Document on associated cost, schedule, and benefit baselines must be determined. Changes in requirements that breach any JRC control can only be approved by the Joint Resources Council, and only if concomitant changes to other breached baselines are also approved.

Every change to a JRC­controlled requirement must be recorded and retained. Place a numbered superscript next to each value that changed from the previous baseline. In a narrative paragraph following the value, explain the reason for the change(s) and provide the change date.

Exhibit 1

Sample Schedule Baseline Categories and Events

(use events as appropriate in the schedule baseline)

6. Risk Management _{(Added 05/2000)}

Risk management is applicable throughout a program’s lifecycle, with appropriate action taken to identify and manage any potential risks. At the time of Investment Decision, the list of potential risks is extracted from the Investment Analysis Report for the candidate solution selected by the JRC for implementation. For on-going acquisition programs being baselined for the first time or re-baselined, risk management must include historical risk events as well as future risk events.

Be sure to consider all aspects of the acquisition program or candidate solution when identifying risk mitigation actions events for risk management. For a complex acquisition program, risk management may include actions relating to the acquisition of systems or equipment, purchase of real property, improvements to the physical infrastructure, modification of facilities, or switchover of operations and maintenance activities to the new capability. It may also include actions that must occur external to FAA (e.g., equipage by the airlines) or actions that must be taken by other programs within FAA.

Use the format of Table 6.1 to record risk level, (low, medium, or high) based on a combination of the consequences of the realization of the risk and the probability of the risk occurring; risk mitigation actions for all medium and high risks; and timing for completion. Each entry in Table 6.1 is intended as a one line summary of a risk management action, developed under Investment Analysis, and refined and carried out in the Solution Implementation Phase of AMS.. All risks should briefly describe the probability and consequences involved. If a candidate solution or acquisition program will be implemented in segments, display risk mitigation actions appropriate to each segment.

Details of each risk area can be found in "Risk Assessment Guidelines for the Investment Analysis Process, as Updated, July 1999." Risk management process guidance for the IPTs can be found in "Acquisition and Program Risk Management Guidance," FAA-P-1810, AIT-1-0494, December 20, 1996. Risk management and planning to address risk is also included in the AMS in the Integrated Program Plan and the Acquisition Strategy Paper. As part of Table 6.1, provide the specific citation for the source document from which summary actions and completion dates are drawn.

Table 6.1 Risk Management Matrix