Subcontract Management Workshop Agenda

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Subcontract Management Workshop Agenda

Overview

  • Magnitude of subcontract dollars.
  • Risk factors in subcontracting.
  • Problems inherent with subcontract control.
  • Performance measurement – the benefits.

Introduction to the Earned Value Concept

  • Problems with comparing plan versus actual to ascertain performance.
  • Earned Value - An essential parameter.
  • The Brick Wall - An illustrative example of Earned Value methods.

Earned Value Management Systems Flowdown

  • Establishing flowdown requirements.
  • Flowdown of Earned Value Management Systems Guidelines (EVMSG).
  • Flowdown of modified EVMSG.
  • Tailoring flowdown requirements.
  • Evaluating subcontractor's proposal response.
  • Sample System Implementation Plan.

Flowdown Requirements Case Study #1

An exercise to determine which requirements to flow down from prime contractor to appropriate subcontractors.

Organization

  • The Work Breakdown Structure (WBS).
  • Integrating subcontracted effort into the prime contract WBS.
  • The subcontract management team.
  • Control Accounts for subcontracted effort.
  • Work Authorization for subcontracted effort.

Subcontract Planning

  • Establishing the Baseline - A three-stage iterative process.
  • Scheduling subcontract effort - The importance of prime and subcontract schedule integration.
  • Budget planning for subcontractor effort.
  • Planning subcontractor fee in prime Control Accounts.
  • Prime contractor planning of subcontracts without EVMSG requirements.
  • Establishment of Budgeted Cost for Work Scheduled (BCWS) for the different contract types.

Control Account Planning Case Study #2 (CPR) and #3 (FFP)

A detailed exercise in Control Account planning which involves using subcontractor source data to plan prime's subcontract Control Accounts.  Several planning techniques will be reviewed and used for planning.

Baseline Maintenance

  • How the prime contractor handles change to the subcontract baseline.
  • How different types of changes affect baseline maintenance.
  • Challenges to the Prime and the Subcontractor's baseline management.

Determining Earned Value for Subcontract Control Accounts

  • Methods used for subcontracts with Contract Performance Report (CPR) and/or the Integrated Program Management Report (IPMR).
  • Methods used for subcontracts without CPR and/or IPMR.

Earned Value – Case Study #4 and #5

Two detailed exercises in Earned Value determination using the solutions from case studies #2 and #3.

Accounting Considerations

  • Cost segregation requirements.
  • Linking prime contractor cost accumulation systems.
  • Accumulating Actual Cost of Work Performed (ACWP) into the Earned Value Management System.
  • Subcontractor's material performance measurement.

Analysis of Subcontractor Performance Data

  • Determining cost variances, schedule variances and variances at completion.
  • Determining how significant variances affect subcontract performance measurement.
  • Typical variance analysis thresholds at the prime Control Account level.
  • Prime contractor's variance analysis process.
  • Estimates-At-Completion (EACs).
  • Validating the subcontractor's EAC.
  • Using performance indices and trend analysis.


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