Data Collection and Knowledge Management White …_Knowledge... · PRODUCED BY THE EACE The Data Collection and Knowledge Management Sub-Group European Aerospace Cost Engineers (EACE)

EUROPEAN AEROSPACE COST ENGINERS Data Collection and Knowledge Management

EACE White Paper

Volume

14

P R O D U C E D B Y T H E E A C E

The Data Collection and Knowledge Management Sub-

Group

European Aerospace Cost Engineers (EACE)

Chair Person Mrs Sherry Stukes (TRW) - inaugural meeting Mr Dale Shermon (PRICE Systems) Secretary Mr Peter Fray (UK MOD)

Table of Contents TABLE OF CONTENTS 2

Background 3 Process Area 14 - Knowledge Management 3

BASE PRACTICE 01 : IDENTIFY STRATEGIC KNOWLEDGE NEEDS AND ASSETS 5

The need or requirement for Knowledge Management 5 What is the cost benefit? 5 Data Gathering Process Criteria 6 Methods of Data Gathering 6

BASE PRACTICE 02 : MOBILISE AND CAPITALISE ASSETS 7 What is Data collection and Knowledge Management in Cost Engineering? 7 Glossary 7 Acronyms 7 Cost Engineers need for Data 7 Guidance on generating a WBS 8 Data Structure 8 Data types 8 Data Dictionary 9 Data Manager 9 Mobilise 9

BASE PRACTICE 03 : IDENTIFY AND IMPLEMENT MECHANISMS FOR KNOWLEDGE CAPTURE AND RETENTION 11

Methods of Knowledge capture 11 Knowledge Capture Processes 11 Lessons Learned / Learnt 12

REFERENCES 13 INDEX 14

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INTRODUCTION Background The Data Collection and Knowledge Management Sub-Group is part of the European Aerospace Cost Engineering (EACE) Working Group.

The EACE published a Cost Engineering Capability Improvement Model (CECIM) in 2002. This model provided a framework for organisations to benchmark their capability in the area of Cost Engineering.

If they determine that their organisation has a weakness or requires improvement in a particular Process Area then there is a series of EACE White Papers associated with each of the Process Areas that can be used to identify and implement improvements.

This White Paper is associated with Process Area 14 - Knowledge Management.

Process Area 14 - Knowledge Management An extract from the Cost Engineering Capability Improvement Model (CECIM) model is reproduced in Figure 1.

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Figure 1 - CECIM Process Area 14

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Base Practice 01 : Identify Strategic Knowledge Needs and Assets The need or requirement for Knowledge Management The Knowledge Management capability is important within Cost Engineering to enable:

• Comparison of projects

• Re-organisation occurs it is essential to capture this knowledge

• Recording of changes during projects

• Facilitates reuse of cost estimating knowledge

• Should be integrated with other cost estimating systems to add value

This is deemed important to avoid making the same mistakes when assessing new projects. It will provide an open book environment.

What is the cost benefit? It is very difficult to produce a quantities analysis of the cost benefit of Knowledge Management and Data gathering. One possible approach is to determine the annual cost saving, resulting from having data, and compare this with the cost of performing the task.

Below is a selection of qualitative reasons for these activities:

• To enable Cost Engineers to “Sell” their estimates to their customers.

• Identify the capabilities in Cost Engineering that are possible as a result of Knowledge Management and Data Gathering.

• Consider the result if no data or knowledge was available, what would be the organisations credibility?

• Promote Knowledge Management and Data Gathering as part of the whole process, not an inconvenient “Add-on”. The process needs to be a closed loop with estimates being compared to actuals to ensure improvement.

• The task will result in saving of time and money during a proposal or bid.

• Accounting Systems will inevitably be justified in your organisation, for the same reasons Data Gathering and Knowledge Management can be justified.

• Risk Reduction is achieved by Validated and Verified Knowledge and data

• Retraining expertise within the organisation

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Identify senior management motivations, for example their personal objectives. It may be easier to convince them that this is an essential task if it is tied into their motivation, for example, capture of corporate knowledge.

Data Gathering Process Criteria When considering the process that is going to be employed in data gathering it is worth considering the following criteria:

• Resource efficient (low cost and schedule)

• Current (up to date)

• Accurate (close to the source)

• Reliable (Validated and Verified)

• Understandable (Defined)

• Timely (Available when needed)

Methods of Data Gathering There are several different processes that can be employed for the gathering of data, they include:

• Interrogate Existing Databases

• Questionnaires

• Interviews

• Literature search (past studies, Supplier doc.)

• Simulated (Created by modelling)

• Field Tests

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Base Practice 02 : Mobilise and Capitalise Assets What is Data collection and Knowledge Management in Cost Engineering? Knowledge Management has the function of Management of Knowledge to provide corporate advantage through the retention of knowledge.

Glossary

Term Definition Data Tables and lists. Data can be collected

Information View of data. Information provides data in context

Knowledge Use or application of information; information in practice

Knowledge = Expert – Novice (KEN)

Acronyms

Term Definition WBS Work Breakdown Structure

EVM Earned Value Management

Cost Engineers need for Data The key requirements for data in Cost Engineering are to:

• Enable comparison of projects

• Record re-organisation and the effect on data

• Record the costed changes during a project

• Avoid the same mistakes

• Provide an open book environment

• Utilise on new projects

• Serendipity – the discovery of the unknown

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Guidance on generating a WBS The single most important tool for a Cost Engineer is a Common WBS when dealing with data. The Cost Engineer should consider the internal and external (customers) WBS. It must be recognised that the internal WBS will be universal for all projects, but the External customer WBS will be project specific.

It is important to be able to map the resources from the internal to the external WBS and back again. Although the external customer WBS will remain constant during the course of a project, the organisation will change and reorganise, it is important that the process in place for data gathering can cope with a fluctuating internal WBS and remain able to map to the external customer WBS.

Any data gathering must be conducted against the Project WBS and the Proposal WBS to enable comparing and close the loop when conducting “lessons learnt” at the end of a project.

The Italian Space Agency has published an instruction on WBS creation. This has been included in Annex A.

The following are a list of Standard Work Breakdown Structures that are recognised by significant procurements agencies:

• ECSS-M-10B Project breakdown structures (13 June 2003) – European Space Agency (ESA).

• Mil. Std. 881 – USA Department of Defence (DOD)

• Cost Resource Breakdown Structure (CRBS) – UK Ministry of Defence (MOD)

Data Structure There are three key elements in the data structure as seen in Figure 2.

Product

Process Resource(People and Materials)

Product

Process Resource(People and Materials)

Figure 2 - Data Structures

Data types There are many different types of data that could be stored. Listed below is a comprehensive list of data types:

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• Cost / Price (money / men / time)

• Schedule

• Quantity

• Technical / Performance

• Organisation / Corporate

• Commercial environment

• Cost of quality

• Economics (Exchange rates, currency, economic conditions, etc.)

• Procured / In-house

• Payment plan / milestones

• Comments, Assumptions, Exclusions

A comprehensive example of the data that needs to be gathered is provided in the ESA PSS Forms. These form are a standard for all submissions to the European Space Agency and are attached for reference in Annex B.

Data Dictionary In order to ensure constancy a WBS Dictionary should accompany the WBS. This document explicitly states the type of data that is stored against each of the elements of the WBS. This avoids any misunderstanding or errors either when producing a proposal, monitoring an on-going project or data gathering.

Data Manager A cost Engineering organisation should employ or identify a Data Manager. Their responsibilities would include:

• Transfer of data

• Data warehousing

• Data Validation (Use of data)

• Data Verification (Responsibility of Data Capture)

Communications skills are an important competence of the Data Manager. It is no use to the organisation that the Data Manager has a perfect set of data if they don’t communicate this fact.

Mobilise The following thoughts have been captured with regards to the practical mobilisation of data gathering and Knowledge Management:

• Central repository

• Internet

• Common Network Drive

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• Database

• Search facilities

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Base Practice 03 : Identify and Implement Mechanisms for Knowledge Capture and Retention Methods of Knowledge capture There are many problems associated with Knowledge Capture when considered in the context of Cost Engineering. Listed below are the advantages of Knowledge and its capture:

• EVM must have it

• Payment by EVM will incentives this activity

• Feedback is essential

• IT Systems (preferably graphical)

• Skills in People – Knowledge transfer (important for the future)

The list below identifies some of the problems to be avoided:

• Time Consuming (avoid taking too much time)

• Costly (avoid costly solutions)

• No immediate benefit (it takes time to realise the benefit)

• Overhead

• Not an individuals objective

Knowledge Capture Processes It is important to have the motivation to capture knowledge; this can be aided by focusing on the “End Game”. Having the reason to capture the data.

The knowledge needs to be gathered against the WBS as far as possible to ensure the assumptions and exclusions regarding that knowledge are relevant.

The following list is a selection of methods of Knowledge Capture processes:

• Questionnaires (Templates)

• Electronically, for example, MIS, MRP, computerised databases

• Studies, for example RAND, NAO / GAO

• Suppliers Evaluations

• Internet Search Engines, for example Google

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Lessons Learned / Learnt This is generally a Post Project activity. It should achieve both:

• a factual gathering of evidence - “Would you go to court with this?” and

• also a dissemination of values – motivation and passion for the industry

The objective is to Close-the-loop and ensure that the organisation evolves by learning from past experiences.

The aim is to retain knowledge in the organisation, one example could be the exit interview, in the Armed Services these can take days to complete.

Capturing Lessons learned has the effect of capturing staff experience, thus the learning process for the next member of staff is accelerated. Lessons learnt result in process improvement, knowledge improvement and develop of staff.

It is possible to learn lessons form other industries as these lessons can cross boundaries. It is a self-imposed constraint to assume that you can’t lean anything form other industries. Benchmarking is a form of learning lessons across industry groups.

Mentoring is an example of fostering and promoting values in an organisation and passing on the enthusiasm for the project, product or industry.

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References

Presentations: • “Cost Data Collection & Knowledge Management” by Daniel Ling, Cranfield

University. European Aerospace Working Group on Cost Engineering – Subgroup Dated -5th November 2003

• “Knowledge Management and Data capture sub-Group” by Dale Shermon, PRICE Systems, sub-group Chairman

• “A Standard Work Breakdown Structure for Space Systems” by G. Filippazzo, The Italian Space Agency Case Study. Dated - EACE/SSCAG Meeting, June 2002

• “Operating and Support cost data collection” by Mr Dale Shermon, Executive Consultant, PRICE Systems

• “Data Collection Process and Lessons Learned” by Sherry Stukes, TRW Systems. Dated - European Aerospace Working Group on Cost Engineering16-18 April 2002

Papers • “Practical uses for a corporate process database” by Lori Vaughan, TRW

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Index

B Benchmarking, 12

C Capturing Lessons learned, 12 CECIM, 3 Close-the-loop, 12 cost benefit, 5 CRBS, 8 Criteria, 6

D Data, 7 Data Manager, 9

E ECSS, 8 EVM, 7

I Information, 7

K Knowledge, 7

Knowledge Capture Processes, 11 Knowledge Management, 7

L Lessons Learned, 12

M mapping, 8 Methods, 6 Mil. Std. 881, 8

N need, 5

P PSS Forms, 9, 21

R requirement, 5 requirements, 7

W

WBS, 7, 15 WBS Dictionary, 9

15

Annex A – Italian Space Agency (ASI) WBS instruction

A Standard Work A Standard Work Breakdown Structure for Breakdown Structure for

Space SystemsSpace SystemsThe Italian Space Agency Case StudyThe Italian Space Agency Case Study

G. FilippazzoG. Filippazzogiancarlogiancarlo..filippazzofilippazzo@@asiasi..itit

EACE/SSCAG Meeting, June 2002

WHAT SHOULD IT ACHIEVE ?

•• Provide a simple and flexible structure Provide a simple and flexible structure applicable to a wide range of space programs.applicable to a wide range of space programs.•• Satisfy the needs of different cost analysis Satisfy the needs of different cost analysis methodologies (grassmethodologies (grass--root as well as root as well as parametric).parametric).•• Support planning and Project Management Support planning and Project Management needs.needs.•• Assure compatibility with basic software Assure compatibility with basic software applications (i.e. Windows) and cost analysis applications (i.e. Windows) and cost analysis tools (ECOS, PRICE, etc..)tools (ECOS, PRICE, etc..)

16

HOW SHOULD WE ACHIEVE IT ?

•• Write the requirements with the basic Write the requirements with the basic guidelines (product oriented, guidelines (product oriented, System/Subsystem breakdown, etcSystem/Subsystem breakdown, etc……))•• Make the requirements applicable to all Make the requirements applicable to all bidders for all proposals within the Space bidders for all proposals within the Space Systems framework.Systems framework.•• Assure compatibility with all existing proposal Assure compatibility with all existing proposal requirements.requirements.•• Keep the requirements short and simpleKeep the requirements short and simple((ASIASI’’s s requirement document is 14 pages longrequirement document is 14 pages long! ! And the And the

last 3 are drawingslast 3 are drawings!).!).

•• Product Oriented.Product Oriented.•• Based on System/Subsystem breakdown principle Based on System/Subsystem breakdown principle (i.e. all products are made by parts (S/S) placed (i.e. all products are made by parts (S/S) placed together (System) to create higher level parts or together (System) to create higher level parts or systems.systems.•• Each S/S (or part) is made from H/W, S/W and Each S/S (or part) is made from H/W, S/W and activities (Support Functions) (a subset of ECOS activities (Support Functions) (a subset of ECOS Sup. Fun. was used).Sup. Fun. was used).

THE BASIC PRINCIPLES

17

DETAILSSupport Functions 1Support Functions 1stst level:level:

Project Project OfficeOfficeManagementManagementEngineeringEngineeringP.A. & Q.A.P.A. & Q.A.

MAITMAITTooling Tooling TestingTesting

S/WS/WProcurementProcurementOperationsOperationsGSEGSE

Procurement1B1-C

Tooling1B1-BB

Testing1B1-BD

MAIT1B1-B

SW1B1-L

Operations1B1-D

Management1B1-AAEngineering1B1-ADP.A.1B1-AC

Project Office1B1-A

GSE1B1-K

S/S 11B1

Procurement1B2-C

Tooling1B2-BB

Testing1B2-BD

MAIT1B2-B

SW1B2-L

Operations1B2-D


Project Office1B2-A

GSE1B2-K

S/S 21B2

Procurement1B31-C

Tooling1B31-BB

Testing1B31-BD

MAIT1B31-B

SW1B31-L

Operations1B31-D


Project Office1B31-A

GSE1B31-K

Unità 11B31

idem

Unità 21B32

Syst. Management1B3A-AASyst. Engineering1B3A-ADP.A.1B3A-AC

S/S3 Project Office1B3A-A

etc...

S/S 3 Syst1B3A

S/S 31B3

SubsystemElements

1B

Syst. Management1A-AASyst. Engineering1A-ADP.A.1A-AC

Syst Project Office1A-A

Syst. AIT1A-B

Syst. GSE1A-K

Syst. SW1A-L

Orb. Ops Support1A-DEGround Ops. & Launch Sup.1A-DC

Syst. Operations1A-D

Syst. Test H/W1A-C

System LevelElements

1A

PROGRAM 1

STANDARD WBS

18

STANDARD WBSFigura 2- Complex System Work Breakdown Structure

Procurement1B1-C

Tooling1B1-BB

Testing1B1-BD

MAIT1B1-B

SW1B1-L

Operations1B1-D


Project Office1B1-A

GSE1B1-K

Satell. 11B1

Procurement1B2-C

Tooling1B2-BB

Testing1B2-BD

MAIT1B2-B

SW1B2-L

Operations1B2-D


Project Office1B2-A

GSE1B2-K

Satell. 21B2

Procurement1B31-C

Tooling1B31-BB

Testing1B31-BD

MAIT1B31-B

SW1B31-L

Operations1B31-D



GSE1B31-K

PWR S/S1B31

Procurement1B321-C

SW1B321-L

Computer1B321

RW1B322

etc..

AOC S/S1B32

etc...



etc...

Sat 3 Syst1B3A

Satell. 31B3

SubsystemElements

1B



Syst. GSE1A-K

Syst. SW1A-L



Syst. Test H/W1A-C


1A

Costellazione X

STANDARD WBSFigura 3- Typical P/L Work Breakdown Structure

Procurement1B1-C

Tooling1B1-BB

Testing1B1-BD

MAIT1B1-B

SW1B1-L

Operations1B1-D


Project Office1B1-A

GSE1B1-K

Computer1B1

Procurement1B2-C

Tooling1B2-BB

Testing1B2-BD

MAIT1B2-B

SW1B2-L

Operations1B2-D


Project Office1B2-A

GSE1B2-K

PWR Supply1B2

Procurement1B31-C

Tooling1B31-BB

Testing1B31-BD

MAIT1B31-B

SW1B31-L

Operations1B31-D



GSE1B31-K

Meccanismo 11B31

idem

Meccanismo 21B32



etc...

Braccio Rob. Syst1B3A

Braccio Rob.1B3

SubsystemElements

1B



Syst. AIT1A-B

Syst. GSE1A-K

Syst. SW1A-L



Syst. Test H/W1A-C


1A

P/L Y

19

WHAT HAPPENED?

•• More than 20 proposals between 2001 and 2002 More than 20 proposals between 2001 and 2002 complied to the WBS requirements.complied to the WBS requirements.•• The proposals ranged from 100.000 The proposals ranged from 100.000 €€ to to 400.000.000 400.000.000 €€..•• The systems presented covered ground stations, The systems presented covered ground stations, ISS payloads, ISS infrastructure, small satellites, ISS payloads, ISS infrastructure, small satellites, LEO constellations, scientific payloads, etcLEO constellations, scientific payloads, etc……•• The proposals were for phase A studies, phase B The proposals were for phase A studies, phase B developments, phase C/D and E/F activities.developments, phase C/D and E/F activities.

DID IT WORK?

•• Yes!Yes!•• Product oriented data collected (sometimes at unit Product oriented data collected (sometimes at unit level, sometimes at S/S level).level, sometimes at S/S level).

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LESSONS LEARNED

•• Accept constructive criticism and feedback.Accept constructive criticism and feedback.•• Adapt to specific needs on a case by case Adapt to specific needs on a case by case

basis (i.e. ground systems are different from basis (i.e. ground systems are different from robotic arms) without changing the basic robotic arms) without changing the basic principles (i.e. Product Oriented and principles (i.e. Product Oriented and System/Subsystem breakdown) .System/Subsystem breakdown) .

•• Resist the temptation to adapt the breakResist the temptation to adapt the break--down to the organizational matrix of the down to the organizational matrix of the bidder (bidder (management usually crosses the management usually crosses the individual product lines).individual product lines).

WHAT IS NEXT

1.1. Improve detail of ground segment Improve detail of ground segment breakdown (logistics, pre and post launch breakdown (logistics, pre and post launch support, operational support, support, operational support, commissioning, etccommissioning, etc……), to properly support ), to properly support Total Lifecycle Cost analysis.Total Lifecycle Cost analysis.

2.2. Improve detail on SW breakdown.Improve detail on SW breakdown.3.3. Introduce criteria to treat recurring and nonIntroduce criteria to treat recurring and non--

recurring elements.recurring elements.

21

Annex B – ESA PSS Forms

These can be obtained from the following URL as “aguest” login: http://emits.esa.int/emits/owa/emits.main Follow the file structure below to obtain the PSS forms.

- Reference Documentation

- Administrative Documents

- PSS Forms

Figure 3 is an example of the PSS form A2.

22

Issue 4

Page No. No. of Pages RFQ/ITT No. COMPANY NAME: Proposal/Tender No.: Name and Title: Economic Condition: Type of Price: Signature

TotalEURO

€

A

2 Total Internal Special Facilities Cost BOTHER COST ELEMENTS Base amounts in NC OH%

a) procured by company b) procured by third party

C D E(A+B+E) F

%

G

H7. Other J

(to be specified)(F+G+H+J) K

) % L(K+L) M

11. Profit ( ) NP

13. Financial Provision for escalation, if applicable ( justification and details to be stated on Exhibit A) Q

(M+N+P+Q) RS

(R-S) T If insufficient space is available to identify all required information, please use additional sheet or insert lines * The Euro is to be used as the NC where the cost accounting system is in Euro.

12. Cost without additional charge (to be itemised on Exhibit A)

14. Total15. Reduction for company contribution (if applicable)

16. TOTAL PRICE FOR ESA

9. Overheads on Subcontractors (Base in NC on which % applies:10. Sub-total

% on Base Amount in NC:

8. Total Cost of All Work Packages

Cost items to which Base in NC to which% applies % applies

5. General & Admin. Expenses6. Research & Develop. Exp.

GENERAL EXPENSES

3.9 Travels3.10 Miscellaneous3 Total Other Direct Cost4. SUB TOTAL COST

3.2 Mechanical parts3.3 Semi-finished products

3.5 Hirel parts3.4 Electrical & electronic components

3.6 External Major Products3.7 External Services3.8 Transport/Insurance

3.1 Raw materialsOH amounts in NC

INTERNAL SPECIAL FACILITIES1 Total Direct Labour Hours and Cost

Type of unit No. of units Unit rates in NC

SUPPLIES AND/OR SERVICES TO BE FURNISHED

Direct Labour cost centres or categories in Manhours in NC*

COMPANY PRICE BREAKDOWN FORM Form No. PSS A2

LABOUR Manpower Gross National Currencyeffort Hourly Rates (NC)

Figure 3 - Example PSS A2 from ESA