Handbook Of Bre

November 30, 1995 Version 1.0 Office of Information Technology (AIT) Prepared by the Office of Information Technology Integrated Product Team for Information Technology Services Chapter 1. Purpose Purpose of the Handbook What is BPI/R • • •

Terminology The Aim of BPI What is the Vision for BPI?

Chapter 2. Elements of Reengineering Methodology •

BPI Principles

Drivers of Corporate Culture Change •

What are the Critical Success Factors?

Description of BPI Elements • • •

What are the Generic Steps to a BPI Project Scope Task Areas

Chapter 3. Activity Analysis Define Scope, Methods, Objectives, and Strategy •

Process Analysis: Looking for Problems and Opportunities

Process Management • • • • •

The Organization Activity Analysis -- Understanding the Organization Beneficial Traits of Problem Analysis Techniques Observation and Interviewing Benefits and Risks of Observation

• • • • • • • • • • • • • • •

Modeling Techniques Facilitated Group Decision Making Techniques Performance Analysis Activity Modeling Characteristics of Business Activity Modeling Compared to Characteristics of Information Systems Modeling Introduction to IDEF0 Modeling and Overview of IDEF0 Modeling Techniques IDEF0 Components ICOM Context Diagram Node Tree Decomposition Diagram Context, Purpose, and Viewpoint Benefits of IDEF0 Modeling Difficulties of IDEF0 Activity Modeling

Understand Our Processes Chapter 4. Business Data Modeling What is Data Modeling? •

IDEF1X -- Information Model

FAA Enterpirse Model Chapter 5. Activity Based Costing Costing Organization Activities Components of Activity Based Costing Steps for Performing ABC • • • • • •

Analyze Activities Gather Costs Trace Costs to Activities Establish Output Measures Analyze Costs ABC Example

Chapter 6. The Business Case What is a Business Case? Developing the Alternatives •

What is an Alternative?

Developing Costs for the Alternative Comparing Alternatives • •

Alternative Risk Cost Discounting

Simulation • •

What is Simulation? Why use Simulation?

Chapter 7. Implementing the Approved Changes Issues to Consider When Implementing the Approved Changes •

Funding

Building the New System Change Management and Training the Staff Chapter 8. The AIT BPI Program Background and Scope Relationship of Information Resources Management (IRM), Information Management (IM), and Corporate Information Management • •

Definition of Information Management Functional Process Improvement -- Criteria for Application

Roles and Responsibilities Support Services/Points of Contact Chapter 9. BPR On-Line Knowledgebase Purpose How to Access What is it?/What's in it? •

The BPR On-Line KnowledgeBASE is comprised of Five Major Parts

References

Used in this Handbook Other References and Reading List • • •

Books Articles Other

Appendix A. Acronyms Appendix B. Glossary Appendix C. CAMS Map (FAA Process Model) Appendix D. Sample Team Charter Appendix E. Generic Statement of Wo CHAPTER 1 Purpose of the Handbook The purpose of this Handbook is to provide the agency with the standards and guidelines used by the Federal Aviation Administration's (FAA) Office of Information Technology (AIT) Business Process Improvement (BPI) Program. The Handbook also provides background on BPI, information on the basic elements of a BPI project, sources of information concerning BPI, the responsibilities and services provided by the BPI Product Team, and how to access additional information about what federal and state governments, and industry, are doing concerning BPI. The purpose of the BPI Program is to develop business process improvement as a key strategy and a management tool capable of supporting the agency's Mission/Vision/ Goals and Objectives and to promote the use of reengineering techniques and methodologies throughout the agency. BPI's goal is to dramatically improve the quality, availability, effectiveness, and cost-effectiveness of business processes within the agency. BPI is focused on completely understanding the customer's needs, identifying how best to meet those needs, and then "reinventing" the value stream of processes that get you there. Three elements are essential to a BPI effort: the redesign of core business processes; the application of enabling technologies to support the new core processes; and the management of organizational change. Through reengineering, AIT strives to develop radically more effective ways to better provide "the right information at the right time in the right format" to our employees, stakeholders and customers. BPI is a vital tool to help the FAA improve the way in which it conducts its functions and mission activities in order to reduce overall costs, provide more efficient use of scarce resources, and better support it's customers. What is BPI/R? Terminology There are several terms that describe what we refer to as "business process improvement," or reengineering. The Department of Defense (DoD) was an early federal

government leader in this area, and now sponsors "functional process improvement" as part of the Corporate Information Management (CIM) initiative under the Director of Defense Information. Standardized techniques-developed largely by DoD and its support contractors and research institutes-to conduct activity and data modeling, are important ingredients in a BPI effort. These techniques have been formalized in Federal Information Processing Standards (FIPS) publications 183 and 184, and are further described in Chapters 3 and 4. AIT's standards and guidelines are based on the successful reengineering experience derived from the DoD model. The Aim of BPI "America's business problem is that it is entering the twenty-first century with companies designed during the nineteenth century." This is how Michael Hammer and James Champy, in their seminal work Reengineering the Corporation (1993), describe the hurdles facing many businesses in America today. They write about one of the most important topics in business circles today: reengineeringthe radical redesign of a company's processes, organization, and culture. Hammer and Champy's writings offer a new vision of how companies should be organized and managed if they are to succeed - even survive - in the l990s and beyond. Reengineering applies to government organizations as well as to private industry. It applies to all organizations, particularly those that perform complex tasks or conduct work activities in a multifunctional environment. According to Hammer and Champy - "Reengineering does not seek to make businesses better through incremental improvements-10 percent faster here or 20 percent less costly there. The aim of reengineering is a quantum leap in performance-the 100 percent or even tenfold improvements that can follow from entirely new work processes and structures. "Today's workers and managers are prisoners of antiquated theories about organizing work-theories that date back to the beginnings of the Industrial Revolution. These ideasthe division of labor into repetitive, discrete tasks; the need for elaborate controls; the managerial hierarchy-no longer work in a world of global competition and unrelenting change." Instead, Hammer and Champy introduce the notion of process orientation, of concentrating on and rethinking end-to-end activities that create value for customers, while removing unnecessary non-value added work (see Figure 3-1. - Activity Analysis). Some of the world's premier corporations have used the principles of reengineering to save hundreds of millions of dollars a year, to achieve unprecedented levels of customer satisfaction, and to speed up and make more flexible all aspects of their operations. The key to reengineering is abandoning the most basic structural notions on which the modern organization is founded. More specifically, Business Process Improvement/Reengineering (BPI/R) is a systematic approach to help an organization make significant advances in the way its business processes operate. BPI defines an organization's strategic goals and objectives and proceeds to align its processes to better meet customer requirements. AIT's BPI program is designed to assist the FAA in streamlining operations and eliminating inefficiencies. The approach detailed in this handbook will help anyone to apply a structured methodology

defining an organization's "AS-IS" environment and to model a "TO-BE" set of processes that add value to the organization's mission and objectives. Improvements can be made, using these processes and data models as a "road map", and technology applied as needed to enable the identified solutions. What is the Vision for BPI? • • • • • •

Increase efficiency Improve customer service Reduce costs Share data and information Use of Information Technology (IT): right place at right time Reduce duplicate, stove-pipe systems Reuse technologoy

CHAPTER 2: Methodology BPI employs a structured methodology that reduces work processes to their essential composite activities, and provides cost performance metrics to facilitate a business case for dramatic improvements. Both functional and cross-functional processes are evaluated through workflow analysis and activity based costing. In many cases, the application of new technology and industry best practices will enable quantum improvements in an organization's cost and performance. BPI Principles • • • • • • • • • • • •

Organize around outcomes, not tasks Process modernization precedes automation Use of benchmarking and other techniques to regularly assess the costs and benefits of functional processes Establish process ownership (responsibility, accountability, and authority) Subsume information-processing work into the real work that produces the information Put decision points where work is performed, and build control into the process Standardize similar processes Customer focus Capture information once, and at the source Move toward agency-wide standard data definitions CHANGE NOW, do not wait for a "perfect" solution Build new systems only as a "last resort"

Drivers Of Corporate Culture Change Business Process Improvement is here to stay. Corporations and government agencies throughout the country are actively using BPI to find ways to do more with less and provide a better product or service in the minimum amount of time. Speed, quality, and cost are the drivers of BPI. In the government, we must become more focused on what these three

drivers mean to us. Vice President Gore's National Performance Review features BPI as a central theme, calling on all agencies to create a government that works better and costs less, to provide quality service at a reduced cost to the taxpayers. There will be fewer people and dollar resources to fulfill future missions. We are facing the challenge now of improving customer service and sustaining public safety and confidence in an environment of declining resources. What are the Critical Success Factors? • • • • •

Strategic focus Resources Change management Top-down commitment Bottom-up (functional) support

A key to success in any BPI effort is strategic focus and top-down leadership. Additionally, there must be some "sense of urgency" due to drastic resource constraints, competition for resources or customers, downsizing and consolidation, or a need for reductions in cycle time, or increases in volume of input or output. A TQM approach can provide a methodology for team-based problem solving through incremental changes. On the other hand, reengineering techniques at the highest end of the change spectrum call for taking out a "clean sheet of paper" to examine key business processes and their inputs and outcomes, to achieve radical and rapid redesign where it will improve performance and customer satisfaction. BPI delivers a clean slate approach, employing automated tools and methodologies where appropriate, and using performance metrics to model, simulate, and assess activities, work flows, business rules, and process relationships. BPI is more about innovation and reuse than efficiency and redo. Through a structured framework for enterprise change, BPI is the means by which major, crossfunctional components of the enterprise are reinvented. A business process is defined as a collection of related structural activities that produces a specified service or product (outcome) for a particular customer. BPI calls for those who seek to enhance or reengineer business processes to think in "process streams," oriented around end products, outcomes, or results, rather than individual process activities which may be separated from each other by the business's organizational or functional divisions. Process streams, focused on the outcome to the customer, follow related process activities across, and regardless of, functional lines.

Figure 2-1. - Reengineered Business Functions BPI initiatives cover a continuum, from basic but critical changes to work activities within business processes, TQM enhancements, automation of process elements and/or employment of other information technologies, to radical redesign of process streams.

Description of BPI Elements What are the Generic Steps to a BPI project? •

Develop Strategic Vision

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Identify and Select Process

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Reengineering Opportunities

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Identify IT Levers and Cost Performance Metrics

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Design New Process(es)

• • •

Design New Process(es) Develop a Business Case for Selection & Implementation of Change Alternatives Formulate Implementation Plan and/or Pilot Program

•

Review, Approval, and Execution

•

Training and Change Management for the New Environment

Scope A BPI team can approach its task in a number of different ways, depending on the resources that can be made available by the parent organization(s), the time available and the requirements to continue to provide daily operational work. A BPI team of experienced reengineers and which includes functional experts of the targeted process, or a team that obtains sufficient training in BPI principles and methodologies (such as those contained in this Handbook), may undertake a BPI initiative by devoting themselves full time to the project. Such a team may be assisted by outside consultants or facilitators, to smooth the BPI process or to provide expert advice or services in the completion of the reengineering steps listed above. An inexperienced team may require more outside assistance, or may have some of the steps be performed entirely with contract help. This is particularly useful

where the teams can not devote their energies on a full time basis to the initiative due to operational needs. AIT has found that due to the tempo of operations in the FAA, the most successful team structure is composed of named personnel representing the key functional areas of expertise, who are committed to the end of the project, but who do not work full time on the effort, instead coming together in brief, periodic workshops that move the work forward. They are assisted by expert contractors who facilitate the workshops and who perform much of the technical details of the BPI process, such as constructing the actual activity and data models from the information developed during the workshops, applying activity based costing to the models, and so forth. Appendix E contains a sample Statement of Work (SOW) that defines those generic contractor work tasks required to plan, review, facilitate, and implement BPI services and support, to assist FAA organizations mandated to achieve significant improvements in business processes. The sample contract is an indefinite delivery/indefinite quantity type contract with firm-fixed priced labor hours to acquire ADP support services as outlined. The scope of the contract encompasses some of the following recommended activities in support of BPI: • • • • •

Strategic Planning Business Process Improvement Prototyping and System Development Implementation Education, Training and Change Management

Task Areas The elements of a BPI initiative are shown in the following model or BPI cycle, and described in the sections that follow: REENGINEERING MODEL

Strategic Planning. This Task Area covers both strategic business planning and strategic information systems planning. Strategic business planning sets the overall direction for the future that integrates an enterprises' processes, people, and technology into concrete, achievable business goals. Environmental assessment and development of the enterprises' vision, mission, goals, and strategies are the building blocks for linking vision with strategic business plan. In consonance with the Government Performance and Results Act, the strategic business plan lays the groundwork for effective planning and management as it documents the guiding principles and critical success factors, specifies performance measures from the executive viewpoint, organizes and allocates resources necessary to achieve objectives, and provides a mechanism to monitor progress from an enterprise-wide perspective. Strategic information system planning includes an information management strategy based on the strategic business plan and a set of architectures to (1) document the current systems environment and guide future development of open, data sharing systems, (2) document a technical strategy for optimum use of new information technologies, and (3) implement continuous process improvement principles to ensure quality throughout the system life-cycle. Architectures include an information architecture to capture high-level information requirements supportive of the strategic business plan, a system architecture detailing major databases and applications needed to support business processes, and a technical architecture that documents the technical infrastructure required for the databases and applications.

This Task Area identifies the major business areas of the enterprise and establishes initial boundaries for business process improvement initiatives. Importantly, it also requires facilitation with the organizations senior business and information technology representatives to address infrastructure changes and business cultural transformation in addition to process, organization, and technology changes. •

Business Process Improvement. This major task involves the joint reengineering of work process and supporting information systems. It may draw on SocioTechnical Systems (STS) design concepts and business process reengineering to assure that optimal human and technological systems performance is achieved in the redesign. Typical components of BPI include: o Scoping of the business area o Assessment of the current "AS-IS" business process o Gathering data from customers o Bench marking "best practices" in other organizations o Reengineering the "TO-BE" process o Developing the Business Case for the reengineered process o Generating an implementation plan for the new process which includes both business and information system changes o Establishing performance management capability in accordance with the Government Performance and Results Act (GPRA) o Reengineering will involve the use of any of the following analytic methods and tools:  IDEF, IEM, ERD, and other modeling techniques for analyzing the old and new processes, data, and business rules,  Upper or integrated CASE tools such as IEF, ADW, BDF, and repository tools such as Rochade for capturing and storing business models,  Simulations tools such as I-think and Simprocess, cost benefit analysis and activity-based costing tools such as TURBO FEA to generate the business case for change,  Variance analysis and statistical process control methods to identify key problem areas,  Functional Economic Analysis,  GroupWare, workshops, focus groups, and interviews to generate and collect data and conduct the re-engineering of the business process to increase the specificity of the business case,  Texas Instruments' Business Design Facility (BDF)'s implementation of IDEF diagrams and automatic export to Texas Instrument's Information Engineering Facility (IEF).

BPI can be used to redesign routine processes in which the steps are well ordered as well as redesign non-routine processes where the order of steps and decisions made vary widely. BPI results in detailed measures and metrics for managers to determine if the redesign is worth pursuing further. It may involve piloting the process, organization and business changes and prototyping new systems (Task Area c).

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•

•

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Prototyping and Systems Development. This Task Area is tightly intertwined with b. Business Process Improvement. It involves an evolutionary prototyping approach to system development which is appropriate when the work system and/or the information systems are substantially new and untested. This Task Area emphasizes rapid solutions to enable improvements to business processes. It frequently involves the use of commercial off-the-shelf (COTS) products such as document management and workflow products; in addition to techniques such as Rapid Prototyping, it may involve the use of upper, lower, or integrated CASE tools. Implementation. This Task Area addresses the actual implementation of the information system and/or organizational changes. It includes assessing implementation needs and issues, developing an implementation strategy, training users, integrating the system with existing systems, migrating to the new system, introducing the business process, information system and organization changes, documenting processes, establishing the needed maintenance and support structures, and evaluating effectiveness of the solution. Education and Change Management. The purpose of this Task is to communicate to FAA managers and staff approaches to strategic planning and BPI, redesign of processes, create information technology solutions and/or organizational changes and related activities. The focus of the training includes methods, techniques, and tools used in the other Task areas. Since BPI can dramatically impact the organization, advanced learning techniques which provide the agency with a broad, multi-faceted understanding of the implications of their activities will be preferred. Data Management. This Task Area is linked to all others. It is included to highlight the importance of managing data as a strategic resource in the development and implementation of new business processes. It includes all aspects of data management including, planning, development of procedures and guidelines, metrics, and standards, and awareness training. It involves the use of supporting analytic methods and tools such as: o IDEF and other modeling techniques that analyze the processes by which data is created, used or needed by the organization, o Data dictionaries or repositories and associated tools such as Rochade for storing data models and metadata on the organization's data entities and attributes, o Information warehouse tools for storing and accessing strategic business data, o Data quality engineering tools to monitor the quality of data on a continuous basis.

In addition to proficiency in the above task areas, the contractor's proposed staff must have experience/expertise in the following areas: • • • • • • •

Operations Research/Economics JRP/JAD Facilitation Workshop Design BPI/IE Seminars FAA BPI Projects Open Systems Architecture Relational Data Base Management Systems

• • • • • •

Enterprise Modeling Team Building Executive Coaching Interactive Design Methods Project Management Client/Server Architecture

Chapter 3. Activity Analysis Define Scope, Methods, Objectives, and Strategy •

Process Analysis: Looking for Problems and Opportunities

Process Management • • • • • • • • • • • • • • • • • • • • •

The Organization Activity Analysis -- Understanding the Organization Beneficial Traits of Problem Analysis Techniques Observation and Interviewing Benefits and Risks of Observation Modeling Techniques Facilitated Group Decision Making Techniques Performance Analysis Activity Modeling Characteristics of Business Activity Modeling Compared to Characteristics of Information Systems Modeling Introduction to IDEF0 Modeling and Overview of IDEF0 Modeling Techniques IDEF0 Components ICOM Context Diagram Node Tree Decomposition Diagram Context, Purpose, and Viewpoint Benefits of IDEF0 Modeling Difficulties of IDEF0 Activity Modeling Understand Our Processes Back Defining Scope, Methods, Objectives, and Strategy

Process Analysis: Looking for Problems and Opportunities This chapter and the two that follow discuss the basic elements of baselining an organization through process and data modeling and activity-based costing; and how

these techniques can be used to identify process improvement opportunities in any organization. This discussion will illuminate why IDEF0, Activity Modeling, IDEF1X, Data Modeling, and Activity-Based Costing (ABC) are the techniques used most often by the FAA and many other Federal and private sector organizations. Before we begin the discussion on activity analysis, it is important to understand what we are going to analyze. We will first look at the central focus of our efforts in Business Process Improvement, the functional process. Process Management The Organization Before discussing process management, we should know where processes come from. To do that we must talk about the basics of the organization. Organizations comprise a fundamental part of our society and our lives. In addition to our involvement in natural human groupings, such as families and friendship groups, we are typically born in organizations, educated by organizations, and spend our working lives employed by organizations. An organization may be simply defined as a human grouping established to accomplish specific objectives. It is expected to perform a mission or turn out products or services, and as members of that organization, undertake to do the work involved, several observable characteristics of an organization emerge, including: • • • •

Division of work and specialization, Coordination of varied activities (processes), Communication, Definition of relationships between activities, or people.

The word organization comes from the word organism, which is defined as a structure with parts so integrated that their relationship to each other is governed by their relationship to the whole. This definition emphasizes the two basic elements of an organization, parts and relationships. Parts are defined as the activities (or processes) necessary to accomplish the work and the people assigned to these activities. Parts should relate to each other, as the complimentary tasks of production and sales in a manufacturing firm. If they do not relate, it is beneficial to determine why; however, the most significant relationships arise among the people performing the activities. Activity AnalysisUnderstanding The Organization This section begins a discussion of the steps and techniques used to analyze a functional process. Activity analysis and activity modeling help an organization understand how it currently does business, and this understanding is the first step in improving an organization's business practices. The focus is on documenting the current baseline (the "AS-IS") and projecting functional process improvements in the future (the "TO-BE").

One of the objectives of activity analysis will be to decompose broad work tasks into discrete activities, and then be able to separate the value added work from that which does not provide something directly to the customer or the desired outcome. Non-value added work is not, however, always unnecessary; it may be required in order for the organization to more effectively manage its operations, be required for safety reasons, or due to regulation. A BPI goal is to eliminate unnecessary non-value added activities: Figure 3-1. - Activity Analysis Different kinds of problems require different kinds of techniques; different aspects of any particular problem may require different kinds of techniques; and there are no panaceas. In fact, most activity analysis methodologies are collections of different techniques that only address certain portions of activity analysis. When an analyst is seeking activity analysis techniques, they should encompass the following traits. Beneficial Traits of Problem Analysis Techniques: • • • • •

Facilitate communication, Provide a means of defining boundaries, Encourage the analyst to think and document in terms of the problem as opposed to the solution, Allow for opposing alternatives but alert the analyst to their presence, Make it easy for analysts to modify the knowledge structure.

Some of the identified general activity analysis techniques can be grouped into four different categories and are as follows: • • • •

Observation and Interviewing, Performance Analysis, Modeling, Facilitated Group Decision Making,

The categories of techniques are not mutually exclusive and are not sequential and in many situations, we utilize all four categories of techniques in the analysis of a problem. Observation and Interviewing The analyst should have proposed an initial definition of the problem and specified the purpose of the analysis before the observation and interview process begins. The different viewpoints from which the problem is to be analyzed should be documented. The problem definition, purpose, and viewpoints should be reviewed and validated with the sponsors of the analysis. In the Structured Analysis and Design methodology, the purpose is defined by explicitly stating the questions to be answered by the creation of the activity model, and the viewpoint is defined by selecting the proper perspective from which to describe the system. Note that activity analysis is an iterative process. The initial problem definition, purpose, and viewpoints are useful in organizing the activity analysis but may be modified based on new information.

Benefits and Risks of Observation Benefits: •

Gain firsthand knowledge about day-to-day operations; provide basis for question formulation and problem verification.

Risks: •

Too much observation can lead to identifying too closely with the way things are currently done; this loss of objectivity can inhibit the identification of alternate ways to describe and accomplish system activities.

Modeling Techniques To perform activity analysis, activity modeling is an essential component. Because systems are usually difficult to understand, often they are large, complex, and confusing, and it is difficult to remember all that is known about a system - a model can provide a method for capturing, organizing, and documenting the information about a system. It is difficult to know if the conception of a system is correct. A model provides a means for understanding and visualizing a system and validating the system through discussions with users. Facilitated Group Decision Making Techniques Facilitated group decision-making techniques provide a different approach to gathering the information required to perform an activity analysis and to construct an activity model. In this approach, structured group sessions and a workshop environment are used to extract information from users in a compressed time frame. The essence of this approach is the interaction of users and analysts working cooperatively as a team to address system requirements. Some Of The Strengths And Weaknesses Of This Approach Are: Strengths: •

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• •

Encourages commitment of senior management and participants. Because the approach depends on the commitment of senior management, participants should feel that their contribution to requirements definition and analysis is important because of the organization wide impact. Condenses and accelerates activity analysis tasks. By combining the numerous activities that comprise the traditional requirements analysis process, facilitated group decision making techniques accelerate the process for significant time savings. Enforces top down analysis by a joint team. Fosters a spirit of cooperation between functional and technical staff. Participants gain a sense of "ownership" of the system.

•

Enhances understanding and analysis of the overall system through sharing of knowledge and communication. Both functional and technical knowledge of the overall system is increased through open communications during the workshop sessions. Participants often uncover things during the sessions that traditional procedures would have missed, such as redundancies, overlapping procedures, and commonalities with other functional areas.

Weaknesses: • • •

•

Requires dollar and time commitment. Depends upon strong management and user commitment. A lack of management commitment may result in poor participation during the process. Increases procedural and logistical difficulties. Procedural difficulties arise when scheduling session times that are convenient for all participants and in when including all participants in all sessions. Requires trained facilitators, analysts, and scribes.

Performance Analysis Another activity analysis type that may be used to define and bound activities is performance analysis. Measures of performance, i.e., cost, time, and quality, can help an organization set its priorities for detailed activity analysis and components of performance analysis include cost, time, and quality. Cost analysis allocates budgets by cost element across the activities performed in the organization. Cost analysis reveals the high cost drivers within the organization and reveals where the most significant impact can be made. In many instances, certain activities within the business do not appear to be cost drivers and are not labor intensive, but may impact the ability of the business to operate. Timeline analysis allows the analyst to locate the bottlenecks within a system. A function may not cost a lot of time or contribute significantly to lead time, but it may consistently generate poor quality output, which indirectly undermines the effectiveness of the organization. Quality analysis determines which activities have the greatest bearing on overall product quality. Activity Modeling What is activity modeling and why do you need to do it? A Model is a representation of a complex reality. Modeling is the act of developing an accurate description of a system. Activity Modeling is the act of developing an accurate description of the activities performed by a system. It is important to emphasize that SYSTEM does not connote "automated system", but refers instead to a business system,

which will be a combination of manual and automated components. In high level activity modeling, the distinction between manual and automated components is not important. When a process is modeled, we can easily see the interrelationships of the specific activities that make up a process at any level of detail we desire. This allows us to critically analyze each activity (task) that comprise the process in our search for improvement opportunities. Because the facts about activities are displayed in both graphical and narrative form, this analysis can be objective, rather than subjective. If there are problems with an activity, these problems will be highly visible. Activity models are hierarchical in nature. This means that we can start with a high-level view of our process, then successively break it down (decompose it) into layers of increasing detail. The following are general steps in performing activity modeling: • • • • •

Identify Describe Bound Validate Analyze

Why do we build both baseline "AS-IS" and target "TO-BE" activity models? A baseline "AS-IS" activity model provides an accurate description of the way activities are currently performed. In addition to providing a means for bounding, validating, and analyzing activities, the model permits accurate performance measures of the activity's cost, time, and quality to be developed. Without such a baseline, it is impossible to analyze alternative methods of performing the activities. A target "TO-BE" activity model provides a description of how the activities will be performed in the future. The boundaries of the target activity model should correspond to the boundaries of the baseline activity model (or differences should be clearly delineated). Performance measures for the target activity model are estimated to compare to the baseline activity model. In an ideal situation, separate and complete baseline and target activity models would be developed for a system. However, often resource and time constraints often do not permit two models to be built and maintained. How can models be used to compare alternative methods of fulfilling requirements? There is no easy answer. In an ideal situation, a complete model of each alternative system for fulfilling a set of functional requirements would be constructed. Then these alternative models would be compared to the baseline and target models and to each other. This process argues for an automated procedure for performing the comparisons. Some CASE toolsenable users to compare models and identify differences, but this analysis is done at such a minute level of detail that the results are difficult to interpret. In performing comparisons that are meaningful, there is no substitute for the astute analyst.

In reality, time and resources are usually not available to construct complete models of each alternative. One possible approach is to model only those portions of each alternative that represent the greatest potential payoff in terms of improved business practices. This approach has a number of advantages: • • • • •

Assists in defining and understanding the alternative, Alternatives can be defined in equivalent terms, Focuses on and bounds the change, Facilitates definitive comparisons, Reduces the time and resources required to perform the comparisons.

What is the difference between business activity modeling and information systems activity modeling? What are the relationships, and why is it necessary to do both? This question can raise controversy, especially among information systems (IS) personnel, who may believe that IS modeling techniques are as sufficient for modeling the business as they are for the modeling they have been doing for years. In addition, there is really no black and white distinction between business activity modeling and information systems activity modeling. Characteristics of Business Activity Modeling • • • •

Models the business from a functional perspective, Focuses on understanding and changing business practices, not automation of business practices, Inputs and Outputs do not represent data, Provides a complete description of a set of activities.

Compared to: Characteristics of Information Systems Modeling • • • •

Models the business from an Information Systems perspective, Focuses on automation of business practices and development or modification of automated systems, Inputs and Outputs represent data, Does not provide a complete description of a set of activities.

Introduction to IDEF0 Modeling and Overview of IDEF0 Modeling Techniques As the FAA reegineering methodology is primarily based on the DoD-derived model and FIPS Publications 183 and 184, the following section is taken from the DoD CIM course on functional process improvement and its Functional Process Improvement Project Book. What is IDEF? IDEF0 is the FAA recommended activity modeling technique. It has been proven effective and easy to use by functional people. Many automated modeling tools based on IDEF0 have been developed by reengineering experts in industry to create the models and

supporting documentation. These tools also allow activity model data to be loaded into repositories for support of Computer-aided Software Engineering (CASE) tools. IDEF is an acronym for Integrated DEFinition Language (or sometimes, ICAM Definition; see Chapter 4). It is a structured methodology for functional process analysis which has a long history of successful application. There are two activity models. The first is the "AS-IS" model, which shows the current (baseline) structure of a functional process. The second is the "TO-BE" model which shows the objective (target) structure of a functional process. The difference between each can be thought of as a set of improvements. The "AS-IS" model plus improvement actions equals the "TO-BE" model. Since improvement proposals are represented by the FEA, we can also say the "AS-IS" plus all FEAs equals the "TO-BE" model. The following Seven Fundamental Concepts of IDEF0 is used in the DoD CIM course, "Functional Process Improvement Project Book," based on material from a major reengineering consultant, Wizdom Systems, Inc.: Seven Fundamental Concepts of Activity Modeling as Implemented with IDEF0 1. To solve a problem you must understand it! IDEF0 attacks a problem by building a model of the subject. The model answers questions about the subject. 2. Analysis of any problem is: top-down, modular, hierarchical, and structured. 3. IDEF0 provides an activity model independent of both organization and time. It is not an organization chart! It is not a flow diagram! 4. IDEF0 is a diagramming technique that shows component parts, inter-relationships between them, and shows how they fit into a hierarchical structure. 5. IDEF0 methods support disciplined, coordinated teamwork. This does not mean you model by committee. This does mean that an IDEF project is a team effort. This does mean that the results will reflect the best thinking of a team. 6. IDEF0 is structured and rigorous! IDEF0 methods follow rules and require all analysis and design decisions and comments to be in written form.

7. IDEF0 follows the principle of gradual exposition of detail. This last concept is a very important one that deserves more explanation: Keep the top levels simple! IDEF0 diagrams progress from high level to more specific. An IDEF0 model starts by representing the whole system as a simple unit in a single box. The single box has a general name and the interface arrows are general. (see Figure 3-2.) The single box is decomposed into its, sub-activities, which will have more specific names, and in turn the arrows will be more specific. Each of those boxes will be decomposed into its sub-activities, which will have more specific names and their interfaces will be more specific. Even though the diagrams may have fewer activities and interfaces, the information they contain will become more detailed. IDEF0 Components Each of the components of an activity model as presented below apply to both "AS-IS" and "TO-BE" models. The components are: • • • • •

ICOMs of the activities in a process (see Figure 3-2.) Node Trees, which graphically portray activities in a hierarchical format (see Figure 3-3.) Context Diagram, a single diagram that illustrates the highest level activity and its information or materials Decomposition Diagrams, which represent refinements of an activity by showing its lower level activities and their information relationships FEO (For Exposition Only) Diagrams, which highlight a particular portion of a Node Tree, Context, or Decomposition Diagram

ICOM The basic building block used in IDEF modeling is the ICOM, which stands for Input, Control, Output, and Mechanism. Here is a generic ICOM (Figure 3-2.) that shows the relationships of the Input, Control, Output, and Mechanism to the activity.

Figure 3-2. - ICOM INPUT That which will be transformed by the activity or process. These include material and information. CONTROL Those elements related to the activity that constrain or govern how the activity will be conducted. Examples include policy, budget constraints, and customer requirements. OUTPUT The result of the activity. This is the input after it is transformed by the activity. MECHANISM Those things that accomplish or support the activity. The mechanism may be people, systems, facilities or equipment necessary to accomplish the activity. The direct costs of doing an activity are associated with the mechanisms. An Enterprise Model of an organization is developed using the IDEF modeling approach. The activity itself is "what" is done. Its interfaces are depicted as arrows entering or leaving the activity box. As in other modeling methods, inputs enter from the left and outputs leave from the right of the box; the activity transforms inputs into outputs. Arrows entering at the top are controls; they provide direction and constraints. Typical controls in the FAA are policy and guidance. Arrows entering from the bottom are mechanisms. Mechanisms represent the means used to perform the activity. For example, an information system is a mechanism, as are the staff who conduct the activity. A model of an enterprise is developed through a top-down process of decomposition, through a series of boxes such as the one at the highest level of the enterprise such as the above, or through node trees. (see Figure 3-3.) The fundamental mission of the enterprise is established as the first activity. This activity is decomposed into several subordinate activities, whose interfaces must be consistent with those in the parent process. Successive levels in the model are developed in the same way, until it is judged to be sufficiently detailed to allow for identification and analyses of potential areas for improvement. Context Diagram

The first step in constructing an IDEF0 function model is to create the Context Diagram. The Context Diagram sets boundaries for the scope of the modeling effort. It is a model of the function at the highest level and the highest level of inputs, controls, outputs, and mechanisms are shown. An enterprise model is developed within a certain context and from a particular point of view. The context can be within a larger enterprise. For example, the FAA mission is part of the larger Federal government mission. The point of view may be that of an organization or leader; the FAA Enterprise Model was developed from the viewpoint of the agency, and is included in Appendix C. Node Tree The next step in IDEF Modeling is to perform a functional decomposition of the context diagram. In IDEF, the Node Tree is used to show that decomposition. This step is just like a work breakdown structure used by project managers. Each of these activities could be further decomposed as needed for analysis. When an activity is decomposed, it is broken down into three to six sub-activities. Activities are identified by a number that indicates their level in the model and relationship to the parent activity. The node tree is the basis for the next step of modelingthat is constructing decomposition diagrams. An example follows:

Figure 3-3. - Node Tree Decomposition Diagram Once the Node Tree has been constructed, a Decomposition Diagram of a model using ICOMs can be built. First, four boxes are arranged in a descending, stair step fashion. This arrangement facilitates drawing lines on the diagram. (Note the diagram does not necessarily indicate the sequence of events nor time.) Once we have the boxes, ICOMs are added (Input, Control, Output, and Mechanisms) for each activity. The ICOMs from the context diagram are reflected on the decomposition diagram. The mechanism, "owner", supports three of the activities. The same process is used to build decomposition diagrams at each level as the models are further decomposed. Based on the decomposition diagram, the context diagram should be updated. Building IDEF models is an iterative process. The model will be continually refined until it has the level of detail that is needed.

Context, Purpose, and Viewpoint • •

•

The CONTEXT establishes the subject of the model as part of a larger whole. It creates a boundary with the environment by describing external interfaces. The PURPOSE establishes the intent of the model or the goal of communication it serves. Purpose explains why the model is created (functional specification, implementation design, customer operations, etc.). The VIEWPOINT determines what can be "seen" within the context, and from what "slant." It states the author's position as an observer of or participant in the system for the benefit of an audience.

Benefits of IDEF0 Modeling 1. IDEF0 provides an understanding of the "AS-IS" environment. The model answers the questions "What do I do?" and "What resources do I need, to do what I do?" 2. IDEF0 provides a means for communicating and presenting results. • • •

Everyone is looking at the same model. Everyone is using the same definitions. Everyone is talking about the same thing!

3. IDEF0 identifies and categorizes information entities that form the foundation for information modeling. • •

The IDEF0 arrows represent things. Entities in data modeling represent those things we wish to store information about. Therefore, the arrow labels in IDEF0 diagrams form a list of potential data entities for IDEF1X.

4. IDEF0 provides a tool for managing projects. • • • •

It structures the team organization. It enforces a step-by-step approach. It tracks the evolution from problem to solution. It requires strict documentation, overseen by the project librarian.

5. IDEF0 establishes a forum and a structure for interviewing people. • •

You must obtain specific information and follow a specific agenda. The diagram provides a way to depict (and verify) the information gained from the interviews.

6. IDEF0 identifies opportunities for improvements. •

The IDEF interview and modeling process bring opportunities to the surface.

7. IDEF0 reveals information flow relationships and incongruities. •

You often find that the people who need the information are not getting it, and those who get it don't need it!

8. IDEF0 reveals redundant activities. •

Often, the same activity is unnecessarily performed in more than one place in the organization!

9. IDEF0 documents the "AS-IS" for baseline evaluation and further analysis. •

You must know what you have in order to fix it!

10. IDEF0 begins the roadmap from the "AS-IS" to the "TO-BE." You now know where you are starting from so you can go to where you want to be! Even if you know where you want to go, you can't get there if you don't know where you're starting from. Ask any pilot! Difficulties of IDEF0 Activity Modeling When utilizing IDEF techniques the reengineer should be aware of some drawbacks: • • • • •

Complexity of diagrams. Distinguishing and separating the "AS-IS" from the "TO-BE." Distinguishing and separating different viewpoints. Identifying and distinguishing between controls and inputs. Establishing the proper boundaries for the model.

Activity models ("AS-IS" form) help us understand and visualize what we are actually doing to carry out our organizational mission and business objectives. These models are developed by the functional community working in facilitated decision teams. Understand our Processes IDEF modeling greatly facilitates the development of a new perspective of an organization's activities. From understanding the processes conducted in an organization, we can develop improvement options or alternatives that will add value to the process and/or lower the cost of the process. "TO-BE" models are constructed with this valuable information, which test and/or illustrate the proposed changes and make it possible to simulate the proposed set of changes to verify their effectiveness. CHAPTER 4: What is Data Modeling? A data model is a fully-attributed business rule model, the purpose of which is to design or document a physical database. Data modeling is used to document the information

requirements of the functional activity, to identify reuse requirements and opportunities, to assist in identification of redundant processes, and to guide consistent data administration. IDEF1XInformation Model In the mid-seventies, the U.S. Air Force first recognized the need for semantic data models as a result of the Integrated Computer Aided Manufacturing (ICAM) Program. The objective of the program was to increase manufacturing productivity through the systematic application of computer technology. The ICAM Program identified a need for better analysis and communication techniques for people involved in improving manufacturing productivity. As a result, a series of techniques known as the IDEF (ICAM Definition) Methods which included IDEF1, were used to produce an "information model." In 1981, the ICAM Program published the initial approach to IDEF information modeling. Dr. E. F. Codd's work on relational theory and Dr. P. P. S. Chen's work on entity relationship models provided the theoretical roots for this approach. Under the ICAM program, the U.S. Air Force initiated the Integrated Information Support System (I2S2) project in 1983. The project's objective was to provide the enabling technology to logically and physically integrate a network of heterogeneous computer hardware and software. The need for an enhanced technique for information modeling was recognized as a result of the project and industry experience. In 1982, R. G. Brown of the Database Design Group developed a Logical Database Design Technique (LDDT). LDDT introduced enhanced semantic and graphical constructs, and addressed information modeling enhancement requirements identified under the I2S2 program. In 1985, under the technical leadership of Dr. M. E. S. Loomis of D. Appleton Company, a subset of LDDT was combined with the methodology of IDEF1 and the technique was called IDEF1 Extended or better known as IDEF1X. One of the principal objectives of IDEF1X is to support integration. I2S2's approach to integration focuses on the capture, management, and use of a single semantic definition of the data resource referred to as a "Conceptual Schema." It is independent of how the data is physically stored or accessed, and provides a single application of data within an enterprise that is unbiased toward any single application of data. The Conceptual Schema provides a consistent definition of the meanings and interrelationship of data that is used to integrate, share, and manage the integrity of the data, and it must have three important characteristics: • • •

be consistent with the infrastructure of the business and be true across all application areas, must be extendible, so that new data can be defined without altering previously defined data, and must be transformable to both the required user views and to variety of data storage and access structures.

IDEF1X is a semantic data modeling technique and was developed to meet the following requirements; support the development of conceptual schemas, be a coherent language,

be teachable, be well tested and proven, and be capable of being automated. The basic constructs of an IDEF1X model are: • • •

things about which data is kept e.g., people, events, etc., represented by a box, relationships between those things, represented by lines connecting the boxes, characteristics of those things represented by attribute names within the box.

Function models (IDEF0) show what is done and information models (IDEF1X) define the information needed to accomplish the functions. Business rules are also provided by information models. Information models are made up of things that we call entities, characteristics of those things, called attributes, and the relationships among the entities. Entities are identified by a name. Each entity is uniquely identified by a key-attribute. Additional attributes may be needed to further describe the entity. A strong relationship between the information model and the function model should exist. Entities come from the lines joining the activities on the function model. The two models validate each other, and the building of each should be an iterative process.

Figure 4-1. - Example of Data Model IDEF0 function and information modeling have most of the features of the typical models used to support business process reengineering. IDEF can be used for a wide range of applications and requires minimal training. The key points in IDEF modeling are: • • • •

The analysis must reflect a specific viewpoint, The ICOM is the working element of the IDEF0 diagram, IDEF0 diagramming follows a structured approach form the A0 level through decomposition to the lowest level needed for the analysis, IDEF1X models show entities and their relationships.

Modeling is an iterative process. The first attempt need not be perfect. Subsequent iterations of the analysis will continue to improve the model at all levels. FAA Enterprise Model An enterprise model shows the basic, fundamental functions, processes or activities of an enterprise or organization, often boiled down to just one, two or three key activities at the top (depending on the complexity of the organization), and then decomposed to subactivities to the desired level of detail. A high level functional model showing FAA enterprise activities was developed in 1994, as part of a project to demonstrate a foundation for data administration planning, and as an approach for defining an FAA project management architecture. The FAA Enterprise Model consists of six major high level functions which together make up the FAA enterprise. These functions were titled: Airspace Management; Regulations/Standards/Compliance; Airport Planning and Grants; Aviation Security; Agency Support; and Executive Direction (see Figure 4-2). The functional analysis showed six high level functions that constitute what the FAA does. They are further decomposed into sub functions, which may be further decomposed into processes as the Enterprise Model is developed in more detail down to basic activities. Under the Cost Activity Measurement System (CAMS) initiative, an intra-agency work group separately developed a high level enterprise model that mirrored the functions previously identified, using slightly different nomenclature (see the working draft document in Appendix C). The CAMS initiative seeks to prepare the agency for the requirements of the Government Performance and Results Act, by helping organizations to identify the costs and resources associated with their total business activities, to serve as a management tool and to allow them to devise better performance measures. The FAA Enterprise Model can be viewed also as having six strategic data entities, sometimes called "data buckets." Each high-level data entity represents a corresponding data requirement from the high-level Activity Model. Data buckets are physical locations from which data, common to one theme or subject can be stored, quickly accessed, and quickly returned to the same location. The FAA Data Model constitutes the data component of the overall FAA Enterprise Model which joins process and data into one cohesive and coherent frame of reference. The fundamental objective of the FAA Data Model is to provide the basic data architecture for effective data administration across the agency. Both models should be considered the cornerstone for future FAA BPI/R efforts. Organizations will develop their own enterprise models and decompose them to the level of useful detail to reengineer processes and provide effective performance or output measures. Specific data model objectives would: • • • •

provide the FAA data structure needed to establish responsibilities for shared data, serve as the basis for FAA standard data elements, maximize the utility, integrity, and cost-beneficial sharing of data that facilitates cross-functional integration of FAA activities, assist data stewards in resolution of cross-functional data sharing issues,

• •

serve as an integration vehicle for functional area and component data models, and guide migration of existing data to new shared data structures.

The Data Model was developed in conjunction with the activity modeling, through comprehensive analysis of the Activity Modelthe inputs, controls, outputs, and mechanisms of the individual activitiesand a thorough review of the fundamental guiding documents for that model and the agency. It was through these analyses that strategic entities and their relationships, which reflect and support FAA missions, functions, and FAA data architecture, were derived. The FAA Data Model should be extended down to the level of data elements or attributes and relationships, in concert with the definition of more detailed FAA activities. High level functions were developed considering both current and future states of the FAA. Primary sources of the future FAA vision were the 1994 FAA Strategic Plan, the 1993 Airway Facilities Strategic Plan, and the 1994 draft of Airway Facilities Concept of Operations for the Future. High level functions were developed and confirmed by staff members of AIT. Data subject areas were derived from information requirements defined in system documentation relating to current and proposed applications supporting Operations and Maintenance, Air Traffic Management, Air Traffic Control, Registration, and Compliance and Certification. CHAPTER 5: Costing Organizational Activities Activity Based Costing (ABC) is an accounting technique that allows an organization to determine the actual cost associated with each product and service produced by the organization without regard to the organizational structure (reference Appendix B. Glossary). This chapter explains some of the uses and benefits of Activity Based Costing. We use IDEF0 activity modeling in conjunction with ABC to enable more effective business process design decisions. In order to achieve the major goals of business process improvement, process simplification and improvement, FAA managers need to fully understand the cost, time, and quality of activities performed by employees or machines throughout an entire organization. ABC methods enable managers to cost out measurements to business simplification and process improvement. Included in Vice Presidents Gore's NPR is the need for government to be more productive with less resources. Productivity can be improved when waste is eliminated or reduced and when information replaces the expenditure of capital; for example, when computerbased product definitions are available for the creation of parts on demand instead of physical parts in storage awaiting possible future demand. Productivity also can be improved when costs, risks, and rewards are shared among organizations - the case when business functions and rules are shared and data are integrated. Productivity is a measurement of the performance of activities. Activities can be defined as a named process, function, or task that occurs over time and has recognized results. Activities use up assigned resources to produce products and services. Inputs are transformed into outputs under the perimeters set by controls

performed by the organization's employees and their tools. Activities can be perceived as consumers of resources in production of materials, services, events, or information. Activities are the common denominator between business process improvement and information improvement. The IDEF0 model, as previously discussed under Chapter 3, Activity Analysis, displays these characteristics for the analyst, and is used in the ABC process. Documenting and understanding activities is necessary in order to improve the business process, since activities are the building blocks of business processes. When employees understand the activities they perform, they can better understand costs based on the activities. Traditional financial information is reorganized by ABC into a form that makes sense to the casual functional user; in addition to the usual information that tells them how they spend money, it also tells them what to do with the money. This ability to place costs on activities and their outputs provides a clear metric for improvement, whether for determining improvement priorities in the long-term or for measuring near-term success. ABC allows functional users to characterize the value of, or need for, each activity, getting rid of the waste before automating (or reautomating) activities. Components of Activity Based Costing Before performing ABC, a baseline or a starting point is needed for business process improvement ["AS-IS" model], and a baseline can be expressed in some form of model. A baseline is a documentation of the organization's or agency's policies, practices, methods, measures, costs and their interrelationships at a particular location at a particular point in time. Through baselining, activity inputs and outputs across functional lines of business can be identified. ABC is the only improvement methodology that provides output or unit costs. A structured approach to identification and analysis of the activities is provided by the IDEF0 activity modeling techniques. ABC can be attempted without the use of IDEF modeling, however, ABC accomplishes the most complex task of identifying discrete activities and then identifying the primary output measure for each activity. An important function of ABC is for the organization's activities to be defined as value added or non-value added. Value added activities are those for which the customers are usually willing to pay (in some way) for the service. Non-value added are activities that create waste, result in delay of some sort, add costs to the product/s, or for which the customer is not willing to pay. Resources are assigned to activities to allow them to be conducted; performing the activity results in a cost that can be priced, which can be assigned to the primary output. It is through ABC, that an organization can begin to see actual dollar costs against individual activities, and find opportunities to streamline or reduce the costs, or eliminate the entire activity, especially if there is no value added. Financial Analysis Techniques

Activity Based Costing (ABC) • • • • •

Captures the current cost of performing an activity Targets High Cost activities Provides a context for establishing and monitoring performance measures Provides the link between activity modeling and economic analysis Is useful for forecasting financial baselines

Business Case Development • •

Focuses on "bottom line" results (savings vs. investment) Adjusts for future risks

•

Identifies performance measures

Steps for Performing ABC The CIM Process Improvement Methodology for DoD Functional Managers identifies five activities that need to occur in order to determine activity costs using IDEF0; 1. 2. 3. 4. 5.

Analyze Activities Gather Costs Trace Costs to Activities Establish Output Measures Analyze Costs

These steps should be performed by the core BPI team - which the FAA identifies as a small group of people, committed by top management to work on a BPI project full time if available, or part time on the effort with possible support from BPI contractors. This process can take anywhere from a few days to a few months, depending on level of detail, complexity of an organization's processes, and commitment of team resources. Analyze Activities First the scope of the activities to be analyzed must be identified. It is suggested that the program include at least a half-dozen organizational units having a common functional orientation, and preferably also a common budget somewhere in the reporting chain. The depth and detail of analysis will be determined by activity decomposition, since activity decomposition is complete when one common or homogeneous primary output per activity is reached. Any prior work captured in IDEF0 models and their related definitions is considered here. This is where the core team can use activity models as a basis for selecting and interviewing key people associated with the business process. A determination then is made if an activity is value or non-value added; also if the activity is primary or secondary, and required or not needed. Value added is determined if the output of the activity is directly related to customer requirements, service or product, as opposed to an administrative or logistical outcome that services the providing organization. For

instance, if the output of an activity were an inventory report or update for products (for which there are customers), the output would be non-value added, but necessary to the organization, i.e., "overhead." A major goal of reengineering is to reduce non-value added activities and eliminate those that are not necessary. Primary activities directly support the organization's mission while secondary activities support primary activities. Required activities are those that must always be performed while discretionary activities are performed only when allowed by the operating management. Gather Costs In this step costs are gathered for the activity producing the products or services provided as the outcome. These costs can be salaries, expenditures for research, machinery, office furniture, etc. These costs are used as the baseline activity costs. When documents for the costs incurred are not available, cost assignment formulas may be used. Trace Costs to Activities In this step the results of analyzing activities and the gathered organizational inputs and costs are brought together, which produces the total input cost for each activity. A simple formula for costs is provided - outputs consume activities that in turn have consumed costs associated with resources. This leads to a simple method to calculate total costs consumed by an activity - multiply the percent of time expended by an organizational unit, e.g., branch, division, on each activity by the total input cost for that entity. Here we are not calculating costs, just finding where they come from. Establish Output Measures In this step the actual activity unit cost is calculated. Even though activities may have multiple outputs, only one is identified as the primary output. Activity unit cost is calculated by dividing the total input cost, including assigned costs from secondary activities, by the primary activity output volume; the primary output must be measurable and its volume or quantity obtainable. From this, a bill of activities can then be calculated which contains or lists a set of activities and the amount of each activity consumed. The amount of each activity consumed is extended by the activity unit cost and is added up as a total cost for the bill of activity. Analyze Costs In the final step, the calculated activity unit costs and bills of activity are used to identify candidates for improving the business processes. Managers can use the information by stratifying, for a Pareto analysis, the activity costs and identifying a certain percentage of activities that consume the majority of costs. The thing to keep in mind is that the identification of non-value added activities occurs through this process with a clarity that allows us to eliminate them, and at the same time permits the product or service to be provided to the customer with greater efficiency. ABC Example

ABC is a powerful tool for measuring business performance, determining the cost of business process outputs, and is used as a means of identifying opportunities to improve business process effectiveness and efficiency. The CIM Process Improvement Methodology for DoD Functional Managers provides one version of the detailed ABC process, and was used by AIT as outlined in the following FAA example from a FY-1995 BPI effort: Below is a process diagram with the sub-activities shown in a sequential activity order for FAA's Controlled Correspondence process, which comes under the Executive Secretariat in the Office of the Administrator, AOA-3. For the ABC, the sub-activities were then analyzed and a cost derived.

Figure 5-1. - High level View of Controlled Correspondence To arrive at individual activity costs, the fully loaded cost of labor was the primary focus in determining the cost incurred by the existing process (because the total labor cost was so large and the other related costs so small in comparison, the total labor cost was used as a close approximation of the total process cost-this will be true for many governmental functions). For some efforts, the costs of equipment, software, floor space, depreciation, etc. might be factors.

Figure 5-2. - Costs of Controlled Correspondence Sub-processes The labor costs were collected for each of the offices involved, both for AOA-3 controlled correspondence, and other, non-AOA-3 correspondence. The labor costs were then applied by using FTEs and GS levels in the nine regions (refer to the table above). In this example, it costs approximately $985 to completely process each piece of controlled correspondence. CHAPTER 6 What is a Business Case? The Business Case pulls together all the data and analysis performed by the BPI team and logically presents the "case" to management for the major viable alternatives that will get to the envisioned "TO-BE" state. The established "AS-IS" environment is used as a baseline. The business case includes the following: an analysis of functional process needs or problems posed from the "AS-IS" position; significant alternative recommendations for improvement; proposed solutions based on the "TO-BE" position; assumptions and constraints; life-cycle costs and benefits of the baseline and alternatives; and investment risk analysis. The business case is a separate document, but very much dependent on the previous steps conducted in the BPI process. It is used by management as a tool to determine and document the costs and benefits of functional process improvements, and of related investments in information technology. Another term for the business case is the Functional Economic Analysis (FEA). The business case provides essential information to FAA managers or decision makers to improve the way they perform their functional activities. The business case analysis presents the information needed by functional managers to choose the best alternative,

comparing the baseline to the alternative costs, and presents the case for investments in process changes by collecting information relevant to the decision and displaying that information in standard formats. As stated in the FEA Guidebook, "The FEA document [business case] is designed to "carry" all the information needed to make good business decisions." The business case is prepared with direct input from the impacted functional manager(s) and the BPI core team, often with the assistance of contractor expertise. The business case may include or be accompanied by a simulation model of the old and new processes. The business case and the simulation models incorporate: • • • • • • •

an analysis of the activity and data models as they describe the "AS-IS" and "TOBE" environments, activity costing (ABC), best practices, quick hits identified to improve processes in the short term, performance measures, alternatives, and the cost of implementing each one.

The purpose of the business case is to permit a decision that will permit the BPI team to go on and develop an Implementation Plan, which will then lay out the selected alternative, sometimes including optional implementation strategies or timelines. So far we have covered the basic elements of a BPI project. We will now discuss how in the Business Case alternatives are developed, compared, and costs formulated. We will also briefly discuss Simulation and its purpose in the Business Case. Developing the Alternatives What is an Alternative? An alternative is the slate of initiatives that will achieve a functional activity's intended "TOBE" state. As data and activity models are developed and analyzed, BPI team members start to develop and conceptualize alternatives. In order to ensure that all options have been considered and that a full range of alternatives is presented to the decision makers, the BPI Program recommends that at least three alternatives to the baseline be developed (but variable depending on the complexity of the process; we realize that certain projects will lend themselves to three or more, but there may be the possibility where only one comes to the forefront). The main objective of developing alternatives is to provide functional managers with insight into the financial and operational impact of proposed improvement changes, with tradeoffs for customer impact, costs, benefits, and time for implementation. The BPI program has adopted the DoD definition of improvement opportunities, or implementation alternatives:

Improvement opportunities are wat needs to be done to the current "AS-IS" environment to move toward one or more of the future, or "TO-BE", functional objectives. Functioal experts discover improvement opportunities through observation, intuition, analysis of "AS-IS" activity and data models; from functional direction, and personal experience. Improvement opportunities are what needs to be done to the current "AS-IS" environment to move toward one or more of the future, or "TO-BE", functional objectives. Functional experts discover improvement opportunities through observation, intuition, analysis of "ASIS" activity and data models; from functional direction, and personal experience. In past BPI projects we have used facilitated workshops to generate and document improvement opportunities. A core team of functional experts and customers supported by BPI contract analysts develop and analyze IDEF process and data models (reference Chapters 3 and 4). The team prepares a comparison of the alternatives, which can be presented in graphs, tables, or whatever method best suits the objective. Alternatives can then be ranked as to potential benefits and the investments required to achieve each opportunity and the degree of support for functional goals. This information provides the basis for initial evaluation and prioritization. These improvement opportunities are extended and refined during the analysis of the business case.

Developing Costs for the Alternatives Below are a variety of methods that can be used to estimate the cost changes associated with an initiative, each of which could be used in conjunction with the ABC done on the activity models by the BPI team; the appropriate choice depends on the nature of the initiative. Possible approaches include: • •

•

•

•

Best Practices. If the initiative is based on a best business practice, what were the savings documented by other organizations? What were the implementation costs? Analogy (Historical). This method is similar to best practices, but applies to cases where there is no widely accepted standard. Historical cost estimates are probably the most common source of cost estimates. Cost data bases exist for everything from office supplies to software maintenance. Expert Opinion. This is useful when cost sources or data bases are not available. This applies to new types of equipment, buildings, software, technology, etc. Consult the experts or reference sources in the specific field for their estimate of investment costs and future savings. Prototypes. Prototypes or pilots are most useful for large expense changes, when there is major uncertainty about proposed process, procedure, or supporting information system changes. Under these circumstances, other means of estimating may not be satisfactory, because there are not enough details and information on which to base an informed estimate. Parametric Cost Estimating. This offers a scientific, yet simplistic approach to developing costs. In parametric cost estimation, the initiative's components are

broken down to a level for which cost data are readily available. The costs of the components are summed to arrive at a total cost. For example, if a house consists of 38,000 bricks and 5,000 shingles, the cost of the house can be estimated by finding out the cost of bricks and shingles, and the cost to install (labor) per unit. In choosing between different alternatives, it is important that the functional manager not only know the estimated cost for each alternative but also have some idea of the risks associated with each proposal. Comparing Alternatives A major function of the Business Case is to document the "AS-IS" and develop alternatives with which to compare to the baseline. One automated application that is used is the Functional Economic Analysis Model developed by the Defense Technical Information Center (DTIC). When using the FEA Model, most of the information required to utilize it has been developed in the preceding sections of a BPI project. The baseline activities have been modeled and the costs determined through activity based costing. At this point, it is a simple matter to array costs for use in the economic analysis of alternatives; depending on the project, the cost categories are chosen, by fiscal year, cost element, etc. Alternative Risk Each alternative must address the risk element. Because alternatives are a window into the future, they are based on estimates. In choosing between the alternatives, it is very important that the functional manager not only know the estimated cost of each alternative, but also be informed of the risks associated with each alternative. The FEA Model provides a mechanism for recognizing risk in the comparison of baseline and alternative costs. To illustrate, consider the following: if an alternative up front shows a cost savings of 50% to perform a certain function, and the probability of achieving the savings is only 25%, it may be better to select an alternative that produces a 25% cost saving, but has an achievement probability of 80%. Cost Discounting Another issue to consider when choosing alternatives is the time value of money or the concept of discounting. For example, one alternative produces a savings of $100 this year, while a second produces $105, but the savings is not realized until next year. Then the savings realized this year with the first alternative ($100) would be worth more than the $105 savings projected for next year: at 10%, the future value of the $100 would be $110, $5 more than the second alternative's savings ($105).

Simulation What is Simulation?

A very important tool that may be used in a BPI project is Simulation. Simulation is the imitation, in a controlled environment, of the a process or system over a specified period or cycle time. Many BPI projects are adaptable to, and should include, simulation of the "ASIS" and the "TO-BE" processes. Using a simulation model, we can produce an artificial history of a system, make observations and draw inferences concerning the processes currently in use or to be used as proposed in the alternatives. The use of simulation has three significant potential applications: • •

•

Business Process Improvement/s Identification - simulation can identify bottlenecks and idle resources and thus allowing for high payoff areas to be targeted. Activity Based Costing is Enhanced - simulation is a dynamic process which is very sensitive to a changing environment. ABC can be static and poorly suited to estimating costs for dynamic processes. Thus, both used in conjunction can achieve a better cost accounting dynamic process. Analyze Alternatives - simulation allows for alternatives to be analyzed quickly, and without the cost and time involved in an evaluation of an actual trial implementation or pilot.

Simulation allows for the "What if" question to be asked several times, from different points of view, and with little or no costs incurred. Why use Simulation? Simulation is a powerful tool which is often the best means, short of a pilot implementation, to answer the "What if" questions, to estimate the costs incurred by the alternatives being proposed, to save money and resources when analyzing alternatives, and to provide a structured framework capable of being used over and over. Drawbacks for simulation includes the time and expense to develop and program a simulated run, and the fact that narrative analytical techniques can suffice-although they may not portray the results as viscerally and succinctly as the simulation. We have used simulation successfully in previous BPI projects such as in a reengineering of the agency's Directives Management system. The path of requesting, storing, ordering and coordinating a directive was simulated to show where and why bottle necks occurred. The "TO-BE" process was also simulated to show "What if's" -- for example, if the directive were distributed using a CD ROM instead of the hard copy and what impact this would have on the distribution process. CHAPTER 7 Issues to Consider When Implementing the Approved Changes At this point in the BPI process top management has been presented with the business case and the best alternative chosen for implementation. A follow-on to the business case is the development of an Implementation Plan. In a BPI effort, the implementation plan is a high level plan that provides management with the basic road map laying out what needs to be done in order to achieve the successful transition from the old way of doing business to the new way. It presents all issues that need to be considered prior to and during the

transition, development phases, provisions for training and change management, and performance measurement and feedback. A detailed project management plan would be one of the first steps undertaken after implementation, but would not necessarily be part of the BPI Implementation Plan provided by the BPI team until after approval for the new process. Some of the key points of the implementation plan are discussed in this chapter, but are not intended to be all-encompassing. Develop Implementation Plan and Implement Solutions • • •

Ensure that all individuals affected are part of the solution Senior leadership must actively promote the improvements Base implementation strategies on cost and time required for each improvement opportunity

•

Ensure that technology-based change is consistent with organizational change

Funding Funding issues for improvement investments become crucial at this stage and, ideally, have been anticipated. Within the federal government, this is the phase when many BPI projects may run into problems if a funding strategy has not been planned in advance. Sometimes a BPI effort is undertaken with the idea by upper management that the initiative will be similar to a requirements analysis or a white paper study that will provide analysis and recommendations, none of which need be acted upon. Consequently preparations to fund the implementation plan are lacking. This ignores the dynamic of a reengineering project and the participation and empowerment necessarily given to the participants, who come from all parts and levels of the organization. The BPI initiative has analyzed the old processes, found their problems and shortcomings, and decisively rejected them by replacing them with a new vision of a better-and a viable-end state. Raised expectations and momentum for change are at their highest at the end of the BPI project; failure to act, or to be able to act, are serious setbacks to the morale of the participants and ultimately to the organization as a whole, while the loss of the momentum for change can severely limit the success of an effort when it is finally launched. There are several reasons why an implementation funding strategy must be considered well in advance. The federal bureaucracy is funded by the legislative branch, based on estimated budget requirements developed during a lengthy budget development cycle. Often funds for the BPI effort come from operational budgets, while implementation funding would come from research and development funds, or facilities and equipment (F&E) funds in the FAA budget-which are locked into long term acquisition programs and contracts. This pitfall can be avoided by addressing BPI opportunities and their resulting recommendations from within the context of a program with an agencywide perspective or with multifunctional, long term goals, from which a reengineering initiative can be seen as one part of the beginning to end planning and acquisition cycle. Building the New System

The objective of BPI/R projects is to radically impact the way business is conducted today, and if we have accomplished our goal, the result should be a new way of doing business and probably a new system that will support the new process(es). Remember, although information technology is often an enabler for desired changes, a new system does not necessarily imply an automated system. Whether the new system is a manual or automated solution, it must absorb or replace in some way the "AS-IS" custom-developed system (which may be manual or automated). Implementation must include development and testing of databases, development and testing of systems and procedures, and documentation. When the new system is based on a readily available, commercial off-theshelf (COTS) software application package, implementation will include installation, possible modification or extension of the package, testing, and in either case, arrangements for the conversion of existing data. Part of doing business the new way includes testing the new process and procedures, which may be approached through a phased implementation (by organization or region), through prototyping, or by a pilot test. It is usually a multistep, multilevel effort, proceeding from the testing of the smallest system units, through larger and larger aggregates of system units, until the entire system is tested as a functioning whole. Even then, additional testing is usually performed to determine the behavior of the system at full operating capacity, or under stress, to compare the results of the new system with that of the old, and to develop client comfort with the system. Simulation models developed during the BPI initiative can continue to provide another means for testing the stress factors. In some instances, the old system may run in parallel with the new system to maintain the flow of product or service to the customer, just in case the new system has missed flaws or unexpected delays; the new outcomes can be compared against the projection and the baseline to ensure they meet the new performance measures. Change Management and Training the Staff Part of the implementation plan must provide training in the operation, administration, and maintenance of the new process, just in time for the staff to assume their new responsibilities. It also should covers coaching as the staff assume those responsibilities. We want to train personnel "just in time" because too early will result in confusion and anxiety about the new systems and processes, and may interfere with customer delivery, while too late means that they are unprepared for their new responsibilities. Sometimes we train personnel to work with the system while it is still being tested. This gives the staff additional time to develop their comfort and proficiency with the system before they have to "live" it, and it gives the system developers additional test cases to evaluate performance issues. But the system should be in a reasonably good state before we allow people to work with it, otherwise we run the risk of alienating them or providing those who adamantly oppose change opportunities to sabotage it. By the time operational training has occurred, training or sessions for team leaders and managers in change management should have occurred. Change management deals with the planning for and managing of the problems and expectations raised in the work force with the new system, process and/or organization. Managers and staff may be impacted

by an entire change in their corporate culture as a result of reengineering, not merely by a few functional process changes. Workers must be encouraged to change not only their work habits, but their views toward the nature of the jobs they have performed in the past and will need to do in the future. They must be helped to realize there will be stress associated with the new processes or system. Management should communicate to all impacted employees that a certain amount of stress is expected and is willing to help with coping with and reducing it. Employees can learn to operate a new system, but if they have not "bought in to" the new business environment within their own personal investment, the new system will falter, no matter how well it works nor how well the transition plan otherwise has been planned. The primary objectives of change management are to: • • •

build acceptance for the change through communication from all levels of the organization and allow for knowledge transfer; behavior and culture modification through training; and to align the organization's capabilities with the change.

For change management to succeed, there are several critical success factors to consider; • • • •

executive or top management leadership, ensuring that people feel they are involved and empowered, continuous communications, and publicity of early successes.

Providing employees training in how the new system works and in understanding the change management process itself can make the difference in a successful BPI/R project. After the employees have been performing their new duties for an adequate length of time, performance evaluation is necessary. As much as we hope every person can meet the challenge of a new way of doing business, some may not be able to do so for various reasons. Performance needs to be identified for several reasons. First, did we provide the correct training? Did we provide training that was adequate or long enough? Did we set expectations to high? etc. If we can identify the reasons why performance is not adequate and make adjustments accordingly, we can avoid the pitfall of employees saying and thinking the self-fulfilling, "I knew this new way would not work". When we identify successful results from performance evaluation, the news should be communicated quickly and positively to build on the achievement. We can compare the results to the baseline to show how well the new process provides better production or service, based on employee performance. If the results are in the form of dollar savings, possibly the savings could be shared with the employees producing those savings in some manner. In any event, it is important to follow up with an analysis of employee performance under the new system.

Figure 7-1. - BPR Impacts All Aspects of an Organization

To Reengineer or Continuous Improvement Depending on the practitioner you consult, the BPI philosophy is either to continuously reengineer or to build in continuous improvement. Because BPI/R is a difficult, expensive and painful process, reengineering can be used in the federal government in limited instances. However, an ongoing consequence of a reengineering initiative can be learning "to think out of the box" and to consider whole processes independent of functionally organized work groups, when looking for improvements to outcomes. Reengineering is defined as the radical redesign of processes, and as soon as the new way of business has been implemented, it becomes the old way, and new BPI opportunities again may be pursued. In some organizations additional reengineering projects may be necessary because the products produced are so diversified. A new reengineering project makes sense for each process if they are functionally separate and do not encompass everything produced in the organization. Another reason to reengineer continuously may be because the organization is in a market sector that deals with products based on rapidly changing technology, such as the electronic communications field. Continuous improvement is an alternative that many government agencies have chosen to make future changes, using an incremental approach that better accommodates Congressional budget process constraints. The BPI Program advocates a mixed approach where reegineering was a cost effective, initial option. After a reengineering project has been conducted, an organization should have correctly identified its business objectives and its business processes, accurately assessed the impact of each process on the business objectives, determined the strategic value-added processes, and then developed and realized a new vision for the way to accomplish business processes. At this point the organization should attempt to build continuous improvement into the process. This "TQM" approach would gradually move them along the improvement scale until major changes in technology, customer requirements or resources again favored a reengineering look at the organization. Graphically this would look like a step scale over time:

Figure 7-2. - Reengineering vs. BPI Depending on the fiscal outlook, what business it is in, and if problems are occurring, an organization has the opportunity to reengineer or make incremental process improvements. Most organizations wait to look at their way of doing business until after problems become so great and intolerable, or resources are diminished so severely (budget cutbacks, personnel cuts, price increases for key resources) that radical solutions are needed. Both reengineering or an incremental improvement approach can be of benefit to organizations that are efficient and doing well. Either strategy can produce opportunities for process improvement, elimination of non-value added activities, streamlining, etc. The key point is for organizations to be forward thinking, and not wait until problems begin, but instead plan ahead based on a good understanding of the relationship of their activities and processes, inputs and outputs and where their costs are incurred. Organization need to design continuous improvement into their business. For continuous process improvement to take place, three requirements must be met: • • •

Employees must be given clear performance goals, measures of goal attainment, and information on the current and past values of those measures. Tools must be provided that are necessary to effect changes in performance. The responsibility, authority, and incentives for improving performance must be present.

In the next chapter we will discuss the responsibilities of the FAA/BPI Program and how organizations can receive assistance and guidance with developing and implementing a BPI Project. Background and Scope

The BPI Program's goal is to develop, promote and support BPI as a key strategy to dramatically improve the quality and effectiveness of business processes within the agency. The BPI Program supports customers in determining what activities and information provide value in support of their objectives and how they interrelate so that effective work processes and outcomes can be implemented. A first step is to educate the FAA about reengineering. We have been successful in providing increased awareness and training in business process reengineering, establishing agency cross-functional partnerships in reengineering initiatives, and creating a central repository for best practices and electronic access to BPI/R databases. A main focus of the BPI initiative is to select and institutionalize reengineering methods that solve business problems using proven business analysis and planning techniques and tools. The BPI Program seeks to facilitate a program of continuous business process improvement that the mission/business areas may utilize to reengineer the enterprise. The program provides contract vehicles for reengineering training and consulting support to FAA organizations, develops partnerships to further reengineering objectives, and produces a knowledge base of concepts, processes, methodologies, lessons learned, benchmarks, and technical resources. Mission/business areas are able to use this knowledge to streamline their work processes and to align them with their mission area objectives. BPI tools and best practices are a key product identified in the Corporate Systems Architecture (CSA). The Corporate Systems Architecture (CSA) is a cross-cutting program that has major near- and long-term implications for safety, operational effectiveness and efficiency, and maintainability of virtually all FAA missions and programs. It will provide an information technology infrastructure of computing and communication systems that interoperate smoothly, perform reliably, have well-defined interfaces, and are modular, expandable and secure. CSA is intended to replace the FAA's current highly fragmented IT environment with a consistent corporate approach to IT development, implementation and management. The CSA program consists of interrelated initiatives which will result in a set of prequalified, state-of-the-art tools, capabilities, services, and resources which will be available to assist FAA mission/business users involved with the prioritization, selection, design, implementation and maintenance of IT applications. These initiatives are cast in two focal areas: core architecture definition and implementation and data management. The establishment of these fundamental elements will provide the foundation on which "upper level" applications such as BPI or EDI can successfully be implemented. Key products from these focal areas include: • • • • •

Corporate IT standards; Corporate IT architecture/topology database; Strategic Network Plan; FAA HQ cable infrastrucutre development; Pilots for new technologies, including desktop video and fax.

As a group, these initiatives constitute fundamental attributes of the emerging ability of the FAA to define, implement, and manage it's corporate information systems, and ensure that the objectives and potential benefits projected for IT investments are achieved.

During Fiscal Year 1995, AIT developed the initial corporate data management infrastructure consisting of policy, standards, procedures, and training, to guide the management of agency data. In addition, AIT, in collaboration with FAA business units, will develop an initial, high-level, corporate data architecture based on the identification and categorization of agency data into a corporate data model, the establishment of stewardship and accountability for specific data, and the subsequent description and standardization of agency data. The corporate data architecture will reside on a corporate data encyclopedia that will be an integral part of the corporate information repository. AIT will continue to provide assistance to business units as they develop data management programs that will be integrated with the corporate program. Relationship of Information Resources Management (IRM), Information Management (IM), and Corporate Information Management Definition of Information Management Information Resources Management (IRM) means the planning, budgeting, organizing, directing, training, promoting, controlling and management activities associated with the burden, collection, creation, use and dissemination of information by agencies, and includes the management of information and related resources, such as federal information processing (FIPS - see glossary) resources. Information management (IM) is the creation, use, sharing, and disposition of data or information by function proponents as corporate resources critical to the effective and efficient operation of agency activities, consistent with IM guidance issued by AIT. This includes the structuring of functional management improvement processes to produce and control the use of data and information in functional activities; information resources management; and supporting information technology, and information services. Functional Process Improvement - Criteria for Application Improving the effectiveness and efficiency of the agency's functional processes involves examining all the inputs, outputs, controls, and mechanisms that affect those processes. Functional processes, data and information resources, and information systems are closely linked to one another. However, there are many processes that can be improved without changes to either data or systems. Process improvement analysis should identify what process changes are desirable, and what data and system changes, if any, are required to implement the process change. Implementing process improvements that are not data dependent or system dependent should never be constrained by unrelated schedules for data and system improvements. Applying sound business practice to functional process improvement necessarily implies the use of good professional judgment by functional and technical managers. The amount of analysis, evaluation, and documentation performed must be tailored to the anticipated investment, and the return expected from that investment. The cost of accomplishing functional process improvement analysis should be significantly less than the cost of the functional process(es) to which it is applied.

"Tailoring" means the process of evaluating requirements to determine their cost effectiveness, and modifying the requirements to ensure they contribute to an optimal balance between need and cost. Tailoring of the analysis, evaluation, and documentation for functional process improvement should focus on how extensive and detailed the analysis and evaluation must be to ensure proper stewardship of the resources for which you are responsible, and for preparing required documentation at an appropriate level of detail. •

•

Important gains in effectiveness and efficiency can be achieved by continuous critical evaluation and restructuring of the way all FAA missions are accomplished and supported. Functional managers have the responsibility to eliminate nonessential processes, and to simplify and streamline essential processes. FAA operations will evolve toward integrated agencywide processes, standard data definitions, and standard information systems in support of agency goals. Sound business principles will be applied to achieve these objectives. This FAA Handbook incorporates experience gained in previous government reegineering initiatives, by the BPI team, and from the concepts of corporate IM to improve the management of functional processes, data resources, and information systems. It contains guidance that enables the FAA to take rapid, successful steps toward achieving the savings required under the President's National Performance Review (NPR).

Roles and Responsibilities The Director of Information Technology, AIT-1, is responsible for guidance, oversight, and direction of policy, planning, and program activities for the BPI program. AIT-1 assigns a program manager to the BPI Program. The Manager, Integrated Product Team (IPT) for Information Technology (IT) Services, AIT-300, is responsible for operational oversight and functional coordination of BPI program activities, and is the office of primary interest (OPI) for the BPI program. AIT-300 will provide primary support in the areas of: • • • •

requirements identification both internal and external to AIT, benefit/cost analysis and funding justification and support, program development life cycle monitoring including acquisition planning and execution, and supervision of implementation policies, procedures, and program effectiveness and performance measures.

The BPI Product Team is a component of IPT for IT Services, and is resposible for the conduct and vision of the BPI Program. The BPI Product Lead, or Program Manager, will lead the team in the implemention of program management, matrix team management, and project development and implementation. The BPI product team will negotiate agreements with supporting organizations and BPI partners. These agreements as appropriate will describe the tasks to be performed,

products to be delivered, time schedules with milestones, and resource requirements, and will commit the supporting organizations or business partners to satisfactory completion of agreed upon tasks within allotted time-frames. The BPI product team is responsible for: • • • • • •

development of a program management plan, specifications, budget submissions, acquisition plan, and milestones, preparation of all items necessary for executive reviews and briefings, conducting periodic program reviews, tracking program resource consumption, reviewing and approval of all deliverables.

The BPI product team, in conjunction with the OPI, will provide programmatic and functional support to budget requests as necessary. Additionally the BPI team will direct or coordinate the following activities: • • • • • • •

developing and customizing BPI for the FAA, writing plans and policy, executive level briefings and marketing the approach throughout the organization, building a knowledge-base for BPI, including; BPI methodologies and tools, and reusable models, leveraging contractor/consultant support to enhance FAA BPI efforts, developing training plan(s) for BPI, and facilitating work group sessions.

FAA organizations are encouraged to: integrate and implement application of FAA IM principles, procedures, programs, and standards throughout the agency. This includes supporting and participating in functional process improvement efforts such as those described in this Handbook and initiatives sponsored by the AIT BPI Program. The expertise of functional end users is critical in sound definition of requirements and process improvement opportunities. It is believed that compliance by FAA organizations with the standards and requirements stated in this Handbook will lead to more successful implementation of functional process improvements. Support Services/Points of Contact The BPI Program provides appropriate advice and assistance to reengineering efforts by providing in-house consulting, BPI education and awareness training, BPI tools and directories, best business practices, contract vehicles for expert service providers, and partnership in reengineering projects such as the following reengineering pilots and partnerships: • • • •

Airport Improvement Program planning and grants process FAA Directives management AIT Information Management Services FAA Controlled Correspondence process

• • • • • •

BPI database and warehouse of information-BPI KnowledgeBase BPI Repository for reusable activity and data models BPI Library Enforcement Information Systems Obstruction Evaluation/Airport Airspace Analysis Software Engineering Capability Maturity Model

The BPI Program focuses on proven, successful BPI methodologies developed within the federal government and commercial business arenas. Wherever possible, partnerships and alliances are formed to share information and assist in the planning processes. Since program inception, AIT has partnered with other FAA organizations under the BPI Program to reengineer functional processes: completing the redesign of ARP's Airport Planning and Grants Process; supporting AF with the redesign of the Enforcement Information System; redesign of the Obstruction Evaluation/Airport Airspace Analysis process; and a rapid reengineering/proof of technology initiative for the agency's controlled correspondence process. The BPI Program provided training and consulting support to customers throughout the agency and recommended BPI methodologies and tools to FAA organizations embarking on reengineering initiatives. AIT partnered with AHR's Team Technology Center, to develop the FAA Reengineering KnowledgeBase, an on-line (using Lotus Notes) repository for BPR information, best practices and methodologies available to government and private users; an initial operating capacity is scheduled for mid-FY96. For more information about the BPI Program, contact the following: IPT for IT Services, AIT-300 BPI Team Mike Packard, Product Lead Marco Lozada Sheri Martin Internet World Wide Web

(202) 267-8632 (202) 267-9765 (202) 267-7003 [email protected] http://www.faa.gov/ait/bpi/bpihome.htm

Figure 8-1. - World Wide Web BPI Home Page ACRONYM ABC BPI BPIP CAD/CAM CASE

TERM Activity Based Costing Business Process Improvement Business Process Improvement Program Computer Aided Design/Computer Aided Manufacturing Computer Aided Software Engineering

CIM

Corporate Information Management

FEA

Functional Economic Analysis

FPI

Functional Process Improvement

FPI

Functional Process Improvement (DOD's term for BPI)

ICAM

Integrated Computer Aided Manufacturing (ICAM), a U.S. Air Force program that recognized the need for semantic data modeling

ICASE

Integrated-Computer Aided Software Engineering

ICOM

Input, Controls, Outputs, Mechanisms

IDEF

Integrated Definition language or ICAM Definition

IDEF0

Integrated Definition language Activity Model

IDEF1X

Integrated Definition language Data Model

OMW

Object Management Workbench (James Martin tool)

OOIE

Object Oriented Information Engineering

TQM

Total Quality Management

ERM

DEFINITION

Activity

A named process, function, or task that occurs over time and has recognizable results. Activities use up assigned resources to produce products and services.

Activity Based Costing An accounting technique that allows an enterprise to (ABC) determine the actual costs associated with each product and service produced by that enterprise without regard to the organizational structure of the enterprise. Activity Measure A performance value assigned to an activity's primary output. Activity Model

Model of the processes that make up the functional activity showing inputs, outputs, controls, and mechanisms through which the processes of the functional activity are (or will be) conducted.

Activity Output The primary product, service, or outcome of performing an activity. Benchmarking

Comparing your process with the best in class so you can rapidly improve.

Business Process The application of a structured methodology to Improvement (BPI) fundamentally change the way we do work and realize dramatic improvements in speed, cost, and quality. Compared with Reengineering, BPI achieves modest improvements within current framework, impacts a single activity, function, or organizational unit, is part of an end-to-end process, and focuses on improving an existing service or activity. Cost Cost Driver

A resource input to a project, program, or activity expressed in dollar terms. A factor that causes a cost to be incurred.

Cost Elements

Specific resource inputs to projects, programs, or activities.

Critical Success Key activities that must be performed for the process to Factors succeed. Each process normally has between 3 to 5 critical success factors. Without these critical work activities being properly performed the process output cannot be generated. Customer Requirements Customer needs, wants or expectations that a product of service must satisfy. Customers

People who receive your process outputs; can be internal or external to the process. The reason your organization exists.

Data

Symbols representing instances, or occurrences, of specific meanings in the real world.

Effectiveness Measures Provides information on how well you are meeting customer requirements. Efficiency Measures Provides information on how well you are meeting your customer requirements with minimum use of resources. FIPS

Federal Information Processing resources (FIPS): Automatic data processing equipment (ADPE) as defined in Public Law 99-500 and the Federal Information Resources Management Regulation (FIRMR), and set out in the following: (1) Any equipment or interconnected systems or subsystems of equipment that is used in the automatic acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information; (2) Such terms include: computers; ancillary equipment software, firmware and similar procedures; services, including support services; and related resources as defined by regulation issued by the Administrator for General Services.

Final FEA

The revision to the Preliminary FEA that is included in the Implementation Plan document. It contains a more detailed analysis based on a refinement of the costs involved.

Function

Appropriate or assigned duties, responsibilities, missions, tasks, powers, or duties of an individual, office, or organization.

Functional Economic A structured proposal that serves as the principal part Analysis (FEA) of an Implementation Plan for enterprise leadership. It includes an analysis of functional process needs or problems, proposed solutions, assumptions and constraints, alternatives, life-cycle costs and benefits, and investment risk analysis. Functional Process The application of a structured methodology to define a Improvement (FPI) function's AS-IS environment; its objective and strategy for achieving those objectives; and a program of incremental improvements made through functional, technical, and economic analysis and decision-making. ICOM

The acronym for the roles for data or material on an activity model. ICOMs are represented by arrows that interconnect activity boxes. They are named using a noun or noun phrase. Input: Data or material used to produce an output of an activity. Control: Data that constrain or regulate the activity. Controls regulate the transformation of inputs into outputs. Output: Data or materials produced by or resulting from the activity. It must include the input data in some form. Mechanism: Resources (usually people, machines, or systems) that provide energy to, or perform, the activity.

Implementation Plan A document used to guide the implementation of business process improvements. It contains task assignments, schedules, resource allocations, assignments, and evaluation criteria, Improvement Opportunities

Actionable, potential change that either corrects a process deficiency or implements a best practice.

IRM

Information Resources Management (IRM) means the planning, budgeting, organizing, directing, training, promoting, controlling and management activities associated with the burden, collection, creation, use and dissemination of information by agencies, and includes the management of information and related resources, such as federal information processing resources.

Measure

A measurement, taken over a period of time, that communicates vital information about a process or

activity. Model

An abstraction of a subject that allows us to answer questions about the subject. A representation of a complex, real-world phenomenon within some acceptable and predictable tolerance.

Performance Measure A factor used to gauge the speed or responsiveness, quality, or cost of a process, input, or output. Primary Output That single measurable result of an activity by which the cost of an activity is accumulated. Process

A sequence of logically related tasks that use organizational resources to provide a product or service to internal or external customers. Processes have measurable inputs, value-added activities and measurable outputs.

Process Owner Person responsible/accountable for the performance of a process. Normally a manager within the process, has the most resources dedicated to the process, most influence in the process or feels the most pain if the process does not work well. Quality

For measurement purposes, all features and characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs.

Reengineering

"Business reengineering is the fundamental rethinking and radical redesign of an entire 'business system'-the business processes, jobs, organizational structures, management systems, and values and beliefs-to achieve dramatic improvements in critical measures of performance." [Michael Hammer, James Champy Reengineering the Corporation]. Compared to BPI, achieves dramatic improvements changing the current framework, radical redesign of business processes is focused on the end-to-end process and impacts the entire business process; focuses on redefining process(es) to improve outcome(s). "The essence of reengineering, as I see it, is first hooking functions together horizontally rather than vertically; and, second, reinventing the organization as you go horizontal in order to take 24 steps out of a 25 step process." [Tom Peters].

Risk

The possibility that actual future returns (or values) will deviate from expected returns (or values).

Supplier

Person/s who provide inputs to a process; can be internal or external to process.

Total Quality Focuses on a team approach for long-term and continuous Management (TQM) improvement in an organization or to a process; emphasis is on incremental change, usually impacts a single process Waste

The non-value added work activities and resources used in meeting customer requirements. A measure of efficiency.

The Cost Activity Measurement System is a project to develop means of providing decision makers with accurate information about the cost of activities, processes or products and services in FAA organizations. As part of this project, a high level enterprise model was developed describing the agency's basic activities by functional category. (As a work in progress, someProcess Map Definitions may still be incomplete). CAMS PROCESS MAPPING DICTIONARY 1. Air Traffic Services 1.1 Establish/Review Procedures: Determine the need for, develop and define the methods, steps and parameters required to accomplish an action or desired result. The resulting procedure is codified within a described degree of tolerance or allowed variation, which will be reevaluated on a periodic basis. 1.1.1 Identify Need: Determine the requirement for specifying a predetermined methodology to accomplish an action or result. Identify the standards, and analyze the degree of tolerance or variation in the methodology, that would impact the desired results. 1.1.2 Develop Procedure: Identify, create and/or describe the methodology, steps and parameters for a sequence of actions that will cause a predetermined result or operation. Measure and evaluate the cumulative effect of variation or environment in individual steps that will impact the procedure, and adjust accordingly the methodology, steps or parameters. 1.1.3 Implement/Disseminate: Determine the appropriate process or mechanism for making the procedure known to all those who need to know or utilize the procedure, or who are impacted by it. Carry out the implementation/dissemination and ensure the target audience receives it. 1.1.4 Monitor and Evaluate: Establish parameters for the maintenance, review and archival of the procedure, and provide a process for feedback and evaluation. Identify responsibilities for will check on a specified periodic basis on the effectiveness and applicability of the procedure, and for compliance with the procedure. Based on this review, identify the process for making changes to the procedure or its implementation.

1.2 Manage Air Traffic 1.2.1 Flight Plan Coordination: Flight plan coordination occurs between two controllers most commonly located at adjacent sectors or adjacent facilities. This coordination can be automated, such as an automated hand-off or may be manual via the "landline" for nonstandard routes, altitudes, speeds, etc. 1.2.2 Manage Traffic Flow: Balancing air traffic demand with system capacity to ensure maximum efficiency in the National Airspace System. Managing the traffic flow supports the primary air traffic control mission, being the separation of aircraft, by providing a more orderly flow of traffic. 1.2.3 Conduct Operations: Operations vary from control position to control position. RADAR controllers issue real time, precise instructions to pilots regarding when to climb, descend, turn and appropriate speeds. Tower controllers issue departure clearances, taxi instructions or takeoff/landing clearances. 1.3 Provide Aviation Information: Collect, analyze, and report or disseminate information within FAA, and to FAA's customers, that is critical a) to the performance of safe aviation operations and b) to the efficient operation of the National Airspace System, including the efficient operation of FAA. The output of this process is reportsoral, written, or electronic. 1.3.1. Collect Data: Design, develop, produce, install,operate, maintain, and improve mechanisms for acquiring, aggregating, and storing data on subjects of relevance and interest to FAA and its customers. Mechanisms may be manual or automated; storage media may be human, hard copy, or electronic. Provide the data to appropriate analytical organizations, government, other public, or private. The outputs from this process are data sets, in various forms. a. Collect weather briefing data b. Collect NOTAMS data c. Collect accident and incident data d. Collect aviation charts-related data e. Collect other data f. Collect economic data g. Collect FAA operational data 1.3.2. Analyze Data: Identify relevant data sets and analytical tools; place data in formats and locations suitable for application of the analytical tools; and perform the analyses. Format the results of analyses for reporting to appropriate users, government, other public, or private. The output from this process is information in various formats. • • •

a. Analyze weather briefing data b. Analyze NOTAM data c. Analyze accident and incident data

• • • •

d. Prepare new and modify existing aviation charts e. Analyze data for other publications f .Analyze economic data g. Analyze FAA operational data

•

1.3.3. Issue Data: Write, or organize oral, reports; or create properly formatted electronic reports. Design, develop, produce, install, operate, maintain, and improve mechanisms for dissemination as appropriate.

Outputs from this process are reportsoral, written, or electronic. • • • • • • •

a. Provide weather briefings (DUATS) b. Issue NOTAMs c. Issue reports on accidents and incidents d. Publish and disseminate aviation charts e. Provide other publications f. Issue economic analyses g. Issue FAA operation reports

1.4 Manage Airspace (Structure-IFR/VFR) 1.4.1 Identify Changing Requirements: Awareness to airspace design needs to meet future flows of traffic. Awareness to future aircraft performance characteristics as well as changing technology must also be considered. 1.4.2 Analyze Capacity: Determining the Operational Acceptance Level of Traffic (OALT) for a specific element in the National Airspace System. An element would most commonly take the form of an airport or a position of operation. 1.4.3 Coordinate Usage: Working in cooperation with the users of the National Airspace System in order to maximize the overall benefits of the airspace. Some of the users include the FAA, general aviation, air carriers/taxi and the military. 1.4.4 Categorize and Document Airspace: Determining the fair, efficient, and safest use of airspace. Ensuring the accurate attributes of this airspace is readily available to the users. 1.5 Manage Crisis: The process of effectively coordinating the FAA's resources and information to ensure the timely reaction to and control of accidents or incidents related to any of the components of the civil aviation system (internal or external to the FAA) which may impact the safety and/or security of the system. 1.5.1 Determine Initial Response: Pre-planned process of action within an organization's jurisdiction and authority to a safety/security incident or accident. 1.5.2 Gather and Analyze Information: The process of collecting, analyzing, and distributing the information and data necessary to satisfactorily bring the crisis to conclusion.

1.5.3 Resolve Crisis: The process of applying problem solving techniques (using preplanned mitigation strategies) to bring a crisis to a satisfactory conclusion. 1.5.4 Conduct follow-up Actions: After-action critique and/or investigation to determine what went right and wrong during an incident and to develop appropriate follow-up actions. 2.0 Provide Regulations, Standards and Conduct Inspections: The FAA is empowered to promote safety in flight of civil aircraft in air commerce by prescribing the rules and regulations and the minimum standards as may be required in the interest of safety. The FAA is also empowered to perform investigations and conduct inspections, to issue and amend such orders, and to make and amend such general or special rules, regulations and procedures, as deemed necessary to carry out the provision as specified in PUBLIC LAW 103-272 (JULY 5, 1994). The duties and responsibilities of this section includes, but is not limited to: Aircraft Certification: Develop and maintain a methodology for issuance of type certificates for aircraft, aircraft engines, and propellers; to specify in regulations the appliances for which the issuance of type certificates is reasonably required in the interest of safety, and to issue such certificates for appliances so specified. Flight Standards: Develop and maintain a methodology for issuance of airman certificates specifying the capacity in which the holders thereof are authorized to serve as airmen in connection with aircraft. Additionally, Flight Standards shall ensure that no air carrier engages in air transportation unless there is in force a certificate issued by the FAA authorizing an air carrier to engage in transportation. Through the Rule making process, amend, modify, suspend, or revoke, in whole or in part, any type certificate, production certificate, airworthiness certificate, airman certificate, air carrier operating certificate, air agency certificates. Aviation Medicine shall ensure safety in air commerce by means of certification, including terms on the duration of the certificate, periodic or special examinations, and tests of physical fitness. Civil Aviation Registry: shall establish and maintain a system for the recording of each conveyance which effects the title to, or interest in any civil aircraft of the United States. It is unlawful for any person to operate or navigate any aircraft eligible for registration if such aircraft is not registered by its owner. Inspections: It is the FAA's responsibility to ascertain what will best tend to reduce or eliminate the possibility of, or recurrence of, accidents and incidents by conducting special studies inspections and investigations on matters pertaining to safety in air navigation and the prevention of accidents. 2.1 Establish Standards: Develop and maintain the requirements necessary to ensure safe aviation operating environment. Establishing desired, quantifiable and consistent parameters, limits, specifications, regarding the manufacture and operation and maintenance of aircraft.

2.1.1 Identify Need: A major objective of rulemaking is their standardized application to the aviation public. Develop system for and maintain a continuous examination of the aviation environment for implementation of standards regarding new and improved technology. 2.1.2 Develop Standard: Determine the category of need and develop applicable standards that assure the safety of performance. 2.1.3 Implement and Disseminate Standard: Develop and maintain a means of distribution of standards to maintain currency of information and develop a well-informed and aware user. 2.1.4 Monitor and Evaluate: Develop and maintain a system that continually evaluates standards to assure that they remain applicable to changing technology and operating procedures. 2.1.5 Develop Airport Standards 2.2 Conduct Certifications: The process of reviewing, approving, and accepting the performance standards (as measured against a given set of standards) as meeting or exceeding the requirements for a specific system, airport, aircraft, etc. 2.2 Conduct Certifications: The purpose of the certification process is to provide a means by which prospective operators and agencies are empowered to conduct business in a manner which complies with all applicable regulations and directives. 2.2.1 Certification of People: Develop and maintain an appropriate system of certification of persons.. The process is designed to certificate applicants who are willing and able to comply with the regulations or to conform to safe operating practices. "Person" means any individual, firm, co-partnership, corporation, company, association, joint-stock association, or body politic; and includes trustee, receiver, assignee, or other similar representative thereof. 2.2.2 Certify Airports 2.2.3 Certify Equipment 2.2.4 Certification of Procedures: Develop and maintain an appropriate methodology for the certification of procedures in accordance with approved FAA standards. The objective of this task is to determine that the establishment of a new procedure meets or exceeds the safety requirements as identified by the FAA. Successful completion of this task results in the approval of the procedure by the FAA. 2.2.5 Certify Services: The certification of a specific set of services as meeting or exceeding performance standards for those services.

2.2.6 Certify Aircraft: Develop and maintain the necessary means to provide for the original approval of a design for an aircraft, engine/propeller, or aircraft part culminating in the issuance of a type certificate. 2.2.7 Other Certifications 2.2.7 Other Certifications: The process of ensuring Certifications that are not addressed elsewhere.?? 2.3 Ensure Compliance(Regs/Stds/Certs): Compliance means conforming or adapting actions to a rule or to necessity. The ultimate goal is total compliance. While compliance can be compelled where necessary, civil aviation safety depends primarily on voluntary adherence to regulatory requirements. Thus, our foremost efforts to achieve compliance should be directed toward programs to promote a clear awareness and understanding of the regulations. Only where these efforts for achieving voluntary compliance have failed should formal enforcement action be taken. 2.3.1 People Compliance: Develop and maintain appropriate procedures and methodologies in order to assure compliance with FAA rules and regulations that promote aviation safety. Compliance can be obtained through a variety of means, such as initial training, continuing education of airmen, counseling, and legal enforcement action. The public's responsibility is to comply, and through compliance, to participate in the promotion of safety. 2.3.1 Ensure Compliance (Regs/Stds/Certs): Identify appropriate incentives, rewards, and recognition actions, as well as enforcement activities such as inspections to guide activity within the aviation system toward compliance with regulations, standards, and certification criteria. Develop and implement programs to apply these incentives and penalties. The outputs from this process are inspections conducted, violations identified and reported, and incentives/rewards awarded. [Arguably, outputs should include some measure of the degree to which adherence to regulations, standards, and certification criteria is being achieved. This may more properly be covered in the Provide Aviation Information process (1.3), however.] 2.3.2 Ensure Compliance Airports 2.3.3 Ensure Compliance Equipment 2.3.4 Procedures Compliance: Develop and maintain appropriate procedures in order to assure compliance with FAA rules and regulations that promote aviation safety. Training, education, and enforcement each have a different role in achieving compliance. The FAA should encourage compliance with the highest possible standards; however, when it comes to enforcement, the FAA can only require compliance with regulations, precisely as they are written.

2.3.5 (Ensure Compliance) Services: The process of promoting and ensuring compliance with FAA safety and security regulatory standards and requirements for the various services regulated by the FAA. 2.3.6 (Ensure Compliance) Aircraft: Develop and maintain a system to monitor the safety performance of certificated or approved aeronautical products and production quality control systems to assure their continued integrity. 2.3.7 (Ensure Compliance) Other Applications: The process of promoting and ensuring compliance with FAA safety and security regulatory standards and requirements that are not addressed elsewhere. 2.4 Conduct Investigation: Develop and maintain appropriate methodologies in accordance with approved standards for conducting an unbiased gathering of all facts, and the accurate and the prompt reporting of such facts. The sole purpose of conducting an investigation of an act of non-compliance or an accidents is to develop the facts and gather evidence and circumstances of the incident in order to assure future compliance and justify rehabilitation and not to exact retribution. In other words, the need to gather all the information necessary to effect a "fix" not a punishment. 2.4. Conduct Investigations: Examine in greater depth, and with legal finality, reported violations of regulations and standards. Assess fines and impose penalties as appropriate within the legal confines of FAA authority. The outputs of this process are enforcement investigation reports, and civil fines and penalties. 2.4.1 InvestigationPeople: FAA has a statutory obligation to ensure compliance with all regulations. This obligation is especially critical as it applies to the holders of FAA certificates. This group of tasks (investigations) addresses investigative techniques, acquisition of evidence, and analysis of Enforcement Investigation Reports as they relate to the FAA's philosophy for achieving regulatory compliance. 2.4.2 Airports 2.4.3 Equipment 2.4.4 InvestigationProcedures: An investigation uncovers why something occurred, the aggravating and/or mitigating circumstances which led to what was, at the time, an irreversible event. Through discovery of circumstances and eventual analysis of them, the FAA can help to assure compliance is restored or that safety is enhanced. 2.4.5 (Conduct Investigations) Services: A planned systematic search for facts and gathering of evidence through interviews, examination of records, and use of other approved procedures, for the purpose of sustaining or refuting allegations or issues regarding services regulated by the FAA and that could result in administrative, civil or criminal actions.

2.4.6 (Conduct Investigations) Aircraft: Develop and maintain adequate investigatory procedures to assure the continued airworthiness of aircraft. Investigations are conducted to correct unsafe conditions due to design, manufacturing process, and operating and maintenance procedures. 2.4.7 Other See general definition. 2.5 Provide deterrence: The process of developing processes and deploying people and/or equipment to discourage or prevent criminal acts against the national civil aviation system. 3. Plan and Finance Airports 3.1 Conduct Strategic National Capacity Planning: Create a vision and goals for a national airspace design, determine requirements and standards, and identify the steps and milestones in order to achieve them. Develop a process for periodic review, evaluation and adjustment of the planning, including the vision, goals or steps. 3.1.1 Manage Intermodal Issues: Establish a method of communicating and interacting with other modal and department staff and reporting on their activities for matters that concern or impact similar functional areas in FAA organizations. Conduct intermodal strategic and tactical planning and coordinate implementation as required in a joint environment for areas of mutual interest. 3.2 Plan Airport Requirements 3.2.1 Plan Military Airport Transfers 3.3 Fund and Review Environmental Studies 3.3.1 Monitor Noise Compatibility (Part 150) 3.4 Provide Program Financial Assistance 3.4.1 Create Wish List (NPIAS) 3.4.2 Prioritize Potential Projects (ACIP) 3.4.3 Do Tentative Allocations 3.4.4 Manage Grant Agreements 3.5 Grant PFC Authority 4 Provide New Technology: Develop resources and conduct research that will provide solutions (systems, methodologies, devices) to technical or systemic problems or that will enhance existing capabilities. Identify requirements for new technology, facilitate accessibility for those who need to evaluate or utilize its capabilities, and ensure that such

technology will be compatible with the FAA's corporate systems architecture and standards. 4.1 Conduct Research 4.1.1 Provide New Technology for Security Systems: () The development of new equipment, procedures, or improved human performance to prevent or mitigate the consequences of criminal acts against civil aviation. 4.1.2 Avionics 4.1.3 Airports 4.1.4 Propulsion 4.1.5 Airframes 4.1.6 Weather Detection 4.1.7 Human Factors 4.2 Develop Systems: Conduct research, analyze alternatives and devise technological solutions to meet identified requirements. Test, evaluate and adjust proposed systems and provide a plan for implementation that manages transitional changes and expectations. 4.2.1 Conduct Systems Engineering 4.2.2 Develop Prototypes 4.2.3 Conduct Testing 4.2.4 Evaluate System: Develop a process and procedures to review system design and operational performance, and its impact on the existing and planned organization or function. Measure impact on functionality and effectiveness (results) 4.2.5 Implement System: Develop and carry out a plan for transitioning the new system into a fully operational status. Manage costs, provide required training, communicate status and transitional stages, control expectations, make necessary adjustments, and ensure designed operational capacity is fulfilled. 5 Provide FAA Resources: Plan for, acquire, supply, and manage the entire set of resources and services that conduct and support the operational mission of the FAA. These resources/services include: human financial, acquisitions (i.e., systems, equipment, supplies, real estate, and support services), information infrastructure and technologies, legal services, telecommunications, and the actual operational facilities. Outputs from the process: Employees, systems, equipment, supplies, information infrastructure, and support services (e.g., legal).

5.1 Conduct Strategic Planning: The process of developing specific initiatives and milestones into an overall, cohesive plan to achieve over time an organization's mission and goals. This plan will be consistent with the organization's vision, management philosophy, resources, future fiscal environment, customer expectations and other relevant controls, constraints and input. 5.1.1 Develop Plan: Using the organization's vision and mission statement, and milestones from higher organization (department, agency) strategic and business plans, devise initiatives and milestones into a cohesive plan that will achieve the organization's goals over time. 5.1.2 Monitor Implementation: Develop a process and procedures, and assign responsibilities, for reporting on status of elements of the plan. Provide a process for management review and evaluation of milestones and initiatives. Identify metrics for identifying effectiveness and compliance with the plan. 5.1.3: Modify Plan: Based on the review of implementation and changes to plan inputs, resources, timetables, etc., identify and carry out the process for making changes to the plan or its implementation. Changes to the plan will be consistent with or incorporate modifications to the strategic vision, management philosophy, planned fiscal environment, customer expectations and the organization's goals. 5.2 Provide Financial Management Services 5.2.1 Get Financial Resources 5.2.2 Manage Resources 5.2.3 Provide Financial Systems 5.2.4 Review Performance 5.3 Manage Work Force: Plan, develop, implement, and evaluate initiatives that support the effective utilization of human resources. These processes include recruitment, selection, training and development, retention, performance management, compensation/benefits, labor/ employee/organizational relations, etc. This process provides the agency with a diverse, highly qualified, and productive work force to accomplish its operational mission. 5.3 A Manage Mission Requirements: The requirements management process includes those activities necessary to assure that the product being delivered can be tied back to a validated user need and that any changes similarly reflect traceability to user needs. It covers activities from time a mission need is identified up through and including performance in the field. Identification of a mission need may lead to a non materiel solution. In such cases a change in procedure or policy may be sufficient to meet the requirement or the solution may require further research.

5.3.1A Define Need: Initial or redevelopment of statement of need which defines the "operational capability required to perform an assigned mission or to correct a deficiency in existing capability to perform the mission." (FAA Order 1810.1F, Appendix 2, Page 5, March 1993) 5.3.2A Conduct Mission Need Analysis: Activities include work to "Identify technological opportunities for performing current missions in a more cost-effective manner, determine if deficiencies can be resolved by a non-materiel solution, and quantify mission need for a new acquisition" if required. (FAA Order 1810.1F, Page 1-9, March 1993) 5.3.3A Obtain Approval: Formally this includes approval for Key Decision Point #1, but also any other management approvals that may be necessary before proceeding with implementation. 5.3.4A Revalidate Requirements: A continuing process at every stage of a products' life cycle. Requirements should be managed so that they do not grow to exceed planned resources or should be changed to reflect the need for additional resources. 5.3.1 Fill Positions and Set Pay: Define the jobs needed to meet mission requirements and locate, select, determine pay, and hire people to perform the work. Outputs from the process: 1) New employees on duty, 2) Updated CPMIS/CUPS records, 3) Filed and distributed SF-50, and 4) Unsuccessful applicants. 5.3.1.1 Initiate Request: Process used by FAA organizations to initiate the filling of positions. Determine the need to fill a position; verify resource availability to fill the position; establish specific position requirements; and initiate SF-52 action. Outputs from the process: 1) Decision not to fill a position, 2) Classified existing position description, 3) Unclassified position description, and 4) SF-52 with supporting documentation. 5.3.1.2 Determine Job Requirements: Classify, verify and establish positions to fill. Outputs from the process: 1) Classified established position description, 2) SF-52 with supporting documentation, 3) Updated POS (position) file, and 4) Returned position description-incorrect, not classified.

5.3.1.3 Locate Candidates: Publicize and announce job vacancies, and recruit candidates from internal and external sources for various types of appointments. Outputs from the process: 1) Unsuccessful applicants, 2) Tentative selectee, 3) Classified established position description (PD), 4) Pool of applications, and 5) Crediting plan 5.3.1.4 Evaluate Candidates: Screen, assess, and certify candidates for positions under Merit Promotion Program (MPP) and other competitive and noncompetitive procedures. Evaluation of candidates involves testing applicants, assessing basic qualifications, rating and ranking applicants, etc. Outputs from the process: 1) Unsuccessful applicants, 2) Selection list, 3) Tentative selectee, 4) Unsuccessful test results, 5) Assessment instruments, 6) Assessment reports, 7) Recycled applicants, and 8) Trained interviewers. 5.3.1.5 Process Selection: Determine employee's pay, initiate pre-employment processing (i.e., drug testing and physical), make the formal job offer, and complete employee processing by entering personnel data into the Consolidated Personnel Management Information System (CPMIS) and distributing the SF-50. Outputs from the process: 1) Unsuccessful applicants, 2) SF-52 with salary determination, 3) Filed and distributed SF-50, 4) Completed entry on duty forms (EOD), 5) New employee on duty, and 6) Updated CPMIS/CUPS record. 5.3.2 Train and Develop Employees: Plan, design, implement, and evaluate an array of procedures, methods, and practices to improve work force capabilities to meet mission/workload requirements and increase individual employee knowledge, skills, and abilities. Outputs from the process: Trained and developed employees

5.3.2.1 Identify Requirements: Identify and analyze the skills and knowledge which require training based on organizational needs and performance requirements. 5.3.2.2 Identify Source: Determine the most appropriate and cost effective method for developing and obtaining training including the use of internal staff and various procurement options. 5.3.2.3 Develop Training: Develop and sequence learning objectives and identify instructional, methods, media, and testing activities. Create instructional materials (e.g., lesson plans, instructor manuals, student instructional materials, assessment instruments, etc.) to conduct training. 5.3.2.4 Manage Quotas and Enrollments: Determine, allocate, and monitor training quotas and classroom enrollments to insure training requirements are met at reasonable cost to the agency. 5.3.2.5 Deliver Training: Instruct or present the training course, process, procedures, etc. to the target population through instructor-led classroom sessions, computer or print selfpaced learning modules, distance learning, or satellite methods. 5.3.2.6 Evaluate Training: Collect, analyze, and interpret systematic training information (e.g., course content, course objectives, learning outcomes, student feedback, etc.) that can be used to improve course effectiveness; determine whether training objectives/goals are met; assess the return on investment (ROI) of training; and improve processes for acquiring, developing and delivering future training. 5.3.3 Administer Performance Management: Establish procedures/guidance to ensure statutory compliance with all facets of managing employee performance, recognizing employee performance, and the appraisal process. Advise supervisors and managers on options available to correct performance deficiencies (e.g., Performance Improvement Plans) and research, analyze and prepare performance-based actions. Review and document employee recognition and awards for the agency. Outputs from the process: 1) Employees who know what their job responsibilities are (performance plans); 2) performance appraisals; 3) employees who are recognized and rewarded and 4) the identification of non-performers. These outputs lead to enhanced organizational productivity and the achievement of the agency's strategic objectives. 5.3.3.1 Conduct Assessment and Feedback Processes: Administer the agency's processes for providing feedback on employee performance. Advise managers/supervisors on designing career development plans that enhance employees' ability to perform current job assignments, assist employees in personal goal attainment, and help employees acquire the skills, knowledge or abilities to qualify for different assignments.

5.3.3.2 Manage Appraisal Process: Advise organizations on designing performance management systems under the guidelines outlined for the agency. Advise supervisors and managers on developing performance plans and conducting the performance appraisal process. Advise employees on their rights, entitlements and obligations under the appraisal process. Review appraisal documentation and follow-up on rating discrepancies. 5.3.3.3 Manage Employee Awards and Recognition: Advise supervisors/managers/organizations on the various award and recognition options available for employees; provide technical assistance on designing and developing a recognition system/process; collect, analyze and disseminate information on trends in awards/recognition to improve the effectiveness of these processes. 5.3.4 Represent the Agency in Dealing with Labor Organizations: Provide advice and guidance to management on dealing with labor organizations. Advocate management positions to the unions. Outputs from the process: Effective relationships with the unions. 5.3.4.1 Provide Support for Labor/Management Partnerships: Advise management on labor/management partnerships and the relationship with traditional labor relations. Outputs from the process: Labor/management partnerships are established and work effectively to increase customer satisfaction and employee empowerment. 5.3.4.2 Negotiate and Administer Labor Contracts: Represent management in the negotiation of labor agreements with the unions. Provide contract administration advice and guidance. Outputs from the process: Negotiated labor agreements and effective contract administration. 5.3.4.3 Third-Party Representation: Represent the agency in resolving grievances, unfair labor practices, and other third-party issues. Outputs from the process: Resolution of third-party cases. 5.3.5 Manage Employee Benefits: Administer benefits programs for the agency including employee counseling (i.e., Employee Assistance Program), health and life insurance, investment, retirement, and other related programs (i.e., child care facilities, OWCP, etc.) that improve the quality of life. Outputs from the process: Insured employees, employees with retirement benefits, counseled employees/family members, and facilities for providing child care to employees' children. 5.3.6 Manage Equal Employment Opportunity: Ensure the right of all persons to work and advance on the basis of merit, ability and potential. Develop and promote agency EEO

policies and objectives to maintain full compliance with applicable Federal laws. Educate and support supervisors/managers in their leadership role of removing organizational barriers and providing a non-hostile work environment that is free of harassment and discrimination. Outputs from the process: Employees, who perceive equitable and fair treatment in the agency; and EEO policies. 5.3.7 Manage Diversity: Create a work environment supportive of individual and cultural differences by challenging the biased behaviors of others and incorporating diverse employees at all organizational levels. Foster and promote acceptance of diversity in the workplace and capitalize on the different cultures, values, viewpoints, skills, and backgrounds of others to accomplish the FAA's mission and goals. Know, publicize, and enforce FAA policies pertaining to cultural diversity, EEO, and sexual harassment. Outputs from the process: Representative and diverse work force that insures the competitive advantage of the agency. Non-hostile work environment that makes the FAA the employer of choice. 5.3.8 Pay Employees: (Non-HR part of pay-CUPS) 5.3.9 Provide Other Human Resources Services: Deliver other HRM consultative services including: • • • •

Advise and provide technical assistance to promote safe and healthful work conditions for employees; Design employee surveys and collect, analyze, and interpret survey information to support organizational change and FAA management decision making; Apply behavioral science principles/knowledge to develop organizational interventions that facilitate agency improvements and change initiatives; Provide HRM information from CPMIS to agency users/customers to support work force planning, analysis, and evaluation activities.

Outputs from the process: Employee/organizational surveys (i.e., analysis of results, reports); organizational interventions and facilitation; and CPMIS reports. 5.4 Manage Acquisitions: Includes all of the activities involved in obtaining land, buildings, space, systems and equipment, and supplies. These activities include those performed in-house as well as by outside contractors in direct support of acquisitions. 5.4.1 Acquire Systems and Equipment: Includes all of the activities involved in obtaining systems and equipment. Items identified in the Capital Investment Plan will comprise a major portion of these acquisitions. 5.4.1.1 Manage Team: The process of team management includes the actions that deal with defining and establishing the acquisition project organization, developing and maintaining a cohesive project team, and providing the team members with the management and technical training needed for them to properly perform their assigned

responsibilities. It includes the sub-processes of 1) team structure, organization and staffing, 2) team development and maintenance, and 3) team and staff training. The training sub process is detailed elsewhere. 5.4.1.2 Manage Product Integration: The process of managing product integration includes actions that cut across all of the other acquisition project management processes. These actions deal with team communications, team and project quality practices and standards, and the overall management integration of project performance, project risks and change management. It also includes actions associated with the close-out of the acquisition project. It includes the sub-processes of 1) integration planning, 2) integration implementing and evaluating, 3) change management and 4) closing. 5.4.1.3 Plan Technical Work and Workscope: The process of technical/workscope planning includes the actions that deal with defining the work to be performed in meeting the acquisition project objectives, from system design through deployment. It includes developing the project-level plans associated with engineering, supportability and transition and implementation, and defining all Request for Proposal (RFP)/contract or in-house work-related and product-related requirements (technical, schedule and cost) to be included in solicitation packages or in-house work requests. It includes the sub-processes of planning for 1) engineering, 2) supportability, and 3) transition and implementation. 5.4.1.4 Control Technical Work and Workscope: The process of technical/workscope control includes the actions that deal with measuring the status of work performed and evaluating progress against project objectives, from system design through deployment. It includes identifying issues and variances from plans which could impact achieving objectives, developing and directing corrective actions, and reviewing and revising plans for remaining workscope and deliverables, as needed. It also includes performing/monitoring the performance of in-house work and the acceptance of all project deliverables. It includes the sub-processes of controlling 1) engineering, 2) supportability, 3) transition and implementation, 4) in-house work, 5) workscope and deliverables verification. 5.4.1.5 Manage Procurement: The process of procurement management includes the actions that deal with formally defining acquisition requirements, developing solicitation packages, selecting sources, and awarding, administering/managing, and closing contracts. It includes the sub-processes of 1) acquisition planning, 2) source selection/award, and 3) contract management. 5.4.1.6 Manage Schedule: The process of scheduling management includes the actions that deal with developing the schedule which represents the project workscope and deliverables, measuring schedule status, and evaluating schedule progress. It includes identifying schedule issues and variances which could impact the schedule for work objectives/milestones not yet accomplished, developing and directing corrective actions, and reviewing and revising schedules for remaining workscope and deliverables, as needed. It includes the sub-processes of 1) development and 2) tracking and control.

5.4.1.7 Manage Finances: This includes three sub-processes which are described elsewhere. The are 1) investment planning, 2) formulation and presentation of the budget, and 3) execution of the budget. 5.4.2 Acquire Supplies: This includes activities related to the acquisition of goods which are of a standard enough nature not to require the services of a project or integrated product team. Items for office use, restocking of parts inventories, and miscellaneous purchases of all types. 5.4.2.1 Determine Order Quantity: Includes item management duties such as the performance of economic order quantity calculations to determine correct stockage level and order amounts. 5.4.2.2 Manage Procurement: The process of procurement management includes the actions that deal with formally defining acquisition requirements, developing solicitation packages, selecting sources, and awarding, administering/managing, and closing purchase orders or contracts. It includes the sub-processes of 1) acquisition planning, 2) source selection/award, and 3) contract management. 5.4.3 Acquire Real Estate: A process required to lease, purchase or condemn land from private owners in order to install a facility to support the NAS. 5.4.4 Acquire Space 5.4.5 Construct or Alter Buildings, Structures, or Space 5.4.6 Acquire Support Services: A process necessary to provide all required utilities to operate a facility. 5.4.6 Acquire Support Services: Includes all of the activities involved in obtaining contracted services. 5.4.6.1 Manage Procurement: The process of procurement management includes the actions that deal with formally defining acquisition requirements, developing solicitation packages, selecting sources, and awarding, administering/managing, and closing contracts. It includes the sub-processes of 1) acquisition planning, 2) source selection/award, and 3) contract management. 5.4.7 Pay for Acquisition: Includes accounts payable activities. 5.5 Provide Information Infrastructure: Develop and control specifications for the collection, classification, manipulation, dissemination, storage and retrieval of recorded information, including data and telecommunications. Define and maintain information (data and telecommunications) standards and a corporate systems architecture that will meet specifications and fulfill corporate systems and functional requirements.

5.5.1 Manage and Operate Information Technology: Develop standards and procedures for the implementation, operation and coordination of new and existing information technology systems and methodologies consistent with the corporate information infrastructure and architecture. Develop plans and/or standards for information technology cost management; consolidated services; training; maintenance; and technological refreshment, replacement or system archival. 5.5.2 Manage and Operate Telecommunications: Develop standards and procedures for the implementation, operation and coordination of new and existing telecommunications systems and methodologies consistent with the corporate information infrastructure and architecture. Develop plans and/or standards for telecommunications cost management; consolidated services; training; maintenance; and technological refreshment, replacement or system archival. 5.5.3 Capture and Provide Information: Identify and define system and corporate data architecture standards for the collection, classification, manipulation, dissemination, storage and retrieval of recorded data. Develop corporate or functional information systems or methodologies for the processing and reporting of such information to those personnel or other systems who will make use of it, whether for review, analysis, evaluation, management, decision making , or other uses. 5. 6 Provide Legal Services: 5.6.1 Provide legal interpretations, assistance, advice, and counsel to uphold and support policies and practices as sanctioned by statutory requirements and the agency's mission. 5.6.2. Provide legal interpretations, assistance, advice, and counsel in support of the agency's mission and congressional mandates. Ensure lawful practices as it relates to and impacts upon FAA personnel, the public, the aviation industry, and the aviation environment. 5.7 Commission System/Facilities: A facility, system, subsystem or equipment will be considered to be commissioned when it has been formally accepted and placed into operational use or service in the National Airspace System (NAS). It indicates that the Airway Facilities sector has assumed formal maintenance responsibility. 5.7.1 Provide Systems/ Facilities Maintenance: Maintenance, as used in connection with Airway Facilities systems, subsystems, and equipment, is intended to mean any specified sequence of steps prescribed to accomplish an activity to verify or continue a system or service operating. 5.7.2 Conduct Maintenance: Preventive Maintenance: The routine, scheduled maintenance designed to preserve the equipment or to reduce the chance of failure. Preventive maintenance may be used as a generic term discussing all kinds of tasks. 5.7.2.1 Corrective Maintenance: The repair, adjustment, calibration, troubleshooting or other functions required to restore a failed system to operational status.

5.7.3 Monitor Performance: A periodic scheduled test, measurement, or observation of normal operating controls and functions which are necessary to determine whether a system, subsystem, or equipment is operating within its established tolerances or limits (i.e., doing its job satisfactorily at a given time). 5.7.4 Provide Logistics Support: The support of the NAS system operational requirements through acquisition, storage, distribution, and inventory control of instruments, supplies, spare parts, tools, and working equipment. 5.7.5 Conduct Facilities Support 5.8 Provide FAA Communications: a. Planning, preparing, clearing, and presenting information to employees, the general public, the aviation community, and other government agencies regarding FAA activities, policies, and practices. The information is controlled and disseminated through publications, periodicals, audio-visuals, films, exhibits, speeches, special statements, news conferences, and other material designed to inform and educate FAA employees, the general public, and the aviation community. b. Provide information and material to employees, the general public, and the aviation community regarding FAA's programs and objectives. 5.8.1 Provide Internal Communications: Provide a range of information to develop and foster educational programs, comprehensive publications, effective employee/management communication. Write and coordinate speeches consistent with FAA objectives and policies. 5.8.2 Provide External Communications: Provide information, records, and material, exclusive of personal data or matters of national security, to members of the public, private industry, news media, and other government agencies. Provide news and background material about the growth, progress, and accomplishments of the aviation industry. 5.8.3 Respond To inquiries: Respond to inquiries from employees, the general public, aviation community, and other government agencies concerning FAA programs, policies, practices, goals, and objectives. Provide information, records, reports, and other material as requested. 5.8.4 Promote Aviation: Manage activities geared to encourage public awareness and understanding of FAA programs, objections, and goals to bolster and promote public confidence in the national air transportation system. Obstruction Evaluation/Airport Airspace Analysis Team Charter 1.0 Purpose of the Charter

The purpose of this charter is to establish the Obstruction Evaluation (OE)/Airport Airspace Analysis (AAA) Business Process Improvement (BPI) team, scope, objectives, approach, membership, responsibilities, schedule and deliverables. 2.0 Background The Federal Aviation Administration (FAA) is charged with the responsibility to protect and preserve the safe and efficient use of the navigable airspace in the United States. The Associate Administrator for Air Traffic has responsibility for air traffic program management and specifically the OE/AAA program. The activities of this program include analysis of OE notices. Construction proponents are required to notify the FAA of certain construction proposals that meet the notice criteria contained in 14 Code of Federal Regulations Part 77, 30 days before the earlier of the following dates: 1) date the proposed construction/alteration is to begin or 2) date an application for a construction permit is to be filed. When construction proponents notify the FAA of proposed construction (via FAA Form 7460-1 - OE notice), FAA is required to acknowledge the receipt of each notice submitted and also determine whether or not a proposed structure (e.g., antenna tower, building, catenary wire crossing) would constitute a hazard to air navigation. This review is similar to the procedures used to screen proposals for construction located on airports, new airports and airport improvements in relation to existing structures and geographical areas. The review of these types of cases is known as Non-Rulemaking Airports (NRA) and is included in an overall process referred to as AAA. The increased use of new telecommunications technology (e.g., cellular telephone service and paging devices in particular) has led to a rapid increase in OE activities. The FAA currently struggles to process more than 17,000 OE notices a year and anticipates a significant increase in the number of OE notices each year through the end of this decade. The FAA does not have a centralized database or uniform process in place to review, process, and track OE notices and construction activities. Each region and offices within each region have been using different technologies of varying levels of automated support to process an OE notice. An initial OE/AAA automation program has been installed in 5 regions. Within those regions, each office has used automated capabilities to various extents. Installation of this automation program in the remaining 4 regions should be completed by December, 1995. Although this converted OE/AAA system will provide more automated capability to the regions, some of the needs expressed in the Mission Needs Statement - 236 cannot be met by this system. A future redesign of OE/AAA program should be implemented based on studies that will be performed as part of the Capital Investment Planning Process. These studies include a Revalidation of Needs, Market Survey and this BPI effort. Since OE/AAA will be the third subsystem to be developed as part of the Operational Data Management System (ODMS), products of these studieswill be incorporated into the ODMS development efforts.

3.0 Scope The OE/AAA BPI effort will examine the integrated OE/AAA process across regions and headquarters to identify short and long term improvement opportunities with the greatest benefit within existing legislation and will pertain to the following activities: • • •

• • • • • • •

Accessibility, maintenance and generation of required forms Receipt and tracking of OE/AAA notices The Evaluation of OE/AAA cases by: Air Traffic (AT), Airway Facilities (AF), Flight Standards (FS), Airports (ARP) and Aviation System Standards (AVN) and the Military All responses to the construction proponents regarding: acknowledgments and determinations The Discretionary Review Process Overall case tracking from receipt of notice through construction (and charting if required) Notification of actual construction to the National Ocean Service (NOS) Policy and oversight of these activities Aeronautical Studies including Circulization Process to the public ODMS technical and data architectures, requirements and standards

Assumptions include: •

•

•

General correspondence and inquiry activities will not be included in the scope of this project. However, this project will maintain the goal that certain OE/AAA information must be made available for read only "public access" to all organizations internal to FAA and external organizations such as Federal Communications Commission (FCC) and NOS. Although a general review of all regional activities within the above scope will be conducted, three regions will be selected for more detailed BPI analysis based upon how their processing characteristics represent the majority of the nine regions' activities. The BPI team will analyze the OE/AAA program to the level of detail necessary to define process improvements which includes a high level data model, but will not include detailed specifications, data elements, field definitions or algorithms.

4.0 Objective: The objectives of the BPI Team are to rethink and redesign the OE/AAA Process to: •

•

Be responsive to regulatory requirements and increasing workload in a more accurate, efficient and timely manner by: o 1. Streamlining OE/AAA workflow, processes and automation o 2. Identifying opportunities to use additional enabling technologies o 3. Respond to 100% of notices within applicable time-frames as established by appropriate directives and regulations Increasing the accuracy of determinations by accessing more accurate, complete and timely data

•

Produce BPI products that will add to the requirements base and assist the ODMS development team and provide recommendations for short term improvements

5.0 Approach The BPI and SCI/SRA Teams will re-engineer the OE/AAA process using the BPI methodology, techniques and tools proven in previous FAA BPI efforts: • • • • • • • • • •

Validate the existing processes and problems Identify non-value added activities and improvement opportunities Generate recommendations for process changes and automation support Develop an implementation plan Incorporate lessons learned and best practices into process redesigns Examine roles and responsibilities of customers at all levels Leverage Air Traffic Management skills to add value to the process Define measures of performance and mechanisms for feedback Make information user friendly and available to appropriate stakeholders Establish annual program accomplishment timetable

6.0 Roles and Responsibilities •

•

•

Guidance Team: Provides overall guidance and direction to the BPI Team and makes decisions on process improvement alternatives based on the BPI Team's recommendations and business case. The Guidance Team commits resources to the OE/AAA BPI project and communicates status and results of the BPI project with the rest of the FAA. BPI Team: Re-engineer the OE/AAA Process. They contribute knowledge of the current process, perform interviews, involve representative field locations, participate in workshops, develop performance measures and ideas for improvement, recommend improvements and plan implementation of approved actions. SCI/SRA Consultant Team: Provides BPI expertise and supports the BPI Team. The Consultant Team develops the project approach, facilitates workshops and applies BPI techniques and tools to assist the BPI Team. The Consultant Team develops materials for workshops, documents workshop results, prepares briefings, performs analysis, develops the quantitative business case and documents the implementation plan.

7.0 BPI Team Membership The BPI Team is structured as follows: 7.1 Signature request for Team Charter Approval Name(s) of approving official(s) 7.2 Proposed Guidance Team

1. Name 2. Name 3. Name 4. etc. 7.3 Proposed BPI Team 1. Name 2. Name 3. Name 4. etc. 7.4 Consultant Team Consultants: 1. Name 2. Name 3. Name 4. etc. 8.0 Schedule and Deliverables The following is an abbreviated BPI project schedule and list of deliverables. These completion dates are subject to change based upon the schedules of FAA participants. The first work session to discuss As-Is processes is scheduled for 9/5/95 through - 9/8/95. Task/Deliverable

Target Completion Date

Scoping Results Identify FAA project participants

8/18/95

Develop/Deliver Project Plan

8/21/95

Create Project Charter Review/Approve Project Charter Guidance Team Review Finalize Project Charter

8/11/95 8/16/95 8/18/95 8/21/95

As-Is Analysis Develop Preliminary As-Is Model Strawman

8/25/95

Conduct As-Is Worksession

9/8/95

Document As-Is Technical Architecture

9/15/95

Prepare and assemble performance measures Team Review of As-Is Model Finalize As-Is Model

9/14/95

9/25/95 9/29/95

Conduct Best Practices Study

10/17/95

To-Be Analysis Develop Preliminary To-Be Alternatives Conduct To-Be Worksession

10/6/95 10/11/95

Propose To-Be Technical Architecture

11/8/95

Develop Cost and Simulation model

11/8/95

Team Review/Approval of To-Be Alternatives Guidance Team Review Finalize To-Be Alternatives

11/16/95

11/22/95 11/28/95

Business Case and Selected Alternative Develop Business Case with To-Be Alternatives

12/8/95

Team Review/approval of Business Cases Guidance Team Review Finalize Business Cases and select Alternative

OE/AAA BPI Implementation Plan

12/18/95

12/22/95 1/2/96

Develop Strawman Implementation Plan

1/9/96

Conduct Implementation Plan Worksession

1/12/96

Team review/approve Implementation Plan

2/7/96

Guidance Team Review

2/14/96

Finalize Implementation Plan

2/22/96

_________________________________________ Signature of approving official(s) Date understanding of the requirement. Appendix E. Generic Statement of Work (SOW) [Overall Program Name, e.g. Operational Data Management System] [Project Name, e.g. Aeronautical Information Subsystem] [Specific Deliverable Title] under [Contract Name and Number] [Task No. & Name (per table above)] [mm/dd/yy] [Version Number] Prepared by [Contractor Name] [Person to Contact] [Contractor Address] [Contractor Telephone No.] Template for Developing a Statement of Work

This document provides a template for preparing a specific SOW. Text in italics provides guidance and instruction, and should be removed before the final SOW is issued. Boiler plate sentences appear in normal type. They may be adapted or removed as desired. Italicized statements within square bracket [] describe the specific data element or piece of information that should be supplied. 1. Introduction and Overview This statement of work has been issued under contract [name of contract and contract number]. Section 1, Introduction, provides a brief background for the project under which this SOW has been issued, the scope of the effort, and specific objectives to be achieved; Section 2, References, provides a list of the most significant reference items relevant to the project; Section 3, Requirements, is the heart of the SOW, defining precisely what is needed in terms of tasks to be performed and deliverables to be produced; Section 4, Progress/Compliance, lays out the reporting requirements for the project, Section 5, Transmittal/Delivery/Accessibility, provides specific instructions for transmittal of deliverables to the Government, Section 6, Notes, contains miscellaneous secondary information that may amplify material in the previous sections or does not logically fit into those categories. Attachments, if any, follow the last section. 1.1 Background This will be a standard description of the project covered by your IPT subteam. The standard for ODMS is used in this template. The Operational Data Management System (ODMS) will interface with numerous existing and future (upgraded) systems within the National Airspace System (NAS). In its initial state, it will consist of the Aeronautical Information Subsystem (AIS) and the National Operational Data Archive (NODA). The AIS will provide a systematic central source of information about the NAS using a complete and current national database of all configuration data and notices to airmen functions. The NODA will be a national repository of raw data which are currently being recorded by operational and air traffic management and control systems. The Aeronautical Information Subsystem is being developed in two phases, the Initial Operating Capability (IOC) and Field Implementation. The IOC will include the replacement of the two existing systems at the National Flight Data Center with enhanced capabilities to support the current user base. In addition to replacing the existing functionality represented by the current Aeronautical Information System, the United States Notices to Airmen (NOTAM) System, and manual procedures and processes used to support the NFDC mission, the IOC will provide a seamless presentation to the NFDC specialists and the end users of the system. Tools required to support validation of the data such as GIS, textual searches of supporting historical documentation, and query generators (replacing current batch audit/proof reports) will be seamlessly integrated. From a user view, it will appear as a single unified system. The NFDC specialists at IOC will be able to enter data directly into the database, scan graphic images, and accept digital data electronically when available from other systems such as IAPA. End users at IOC will have direct on-line access to all NFDC products and reports. They will be able to

electronically access the NAS resource digital data associated with each charting or publication cycle. 1.2 Scope of Work Begin with a narrative paragraph describing the scope of work covered by this SOW. The following work breakdown structure (WBS) shows the overall hierarchy of the work being performed under the [name of your project]; the shaded portion shows the specific effort to be performed under this SOW. [Include overall WBS; shade that portion of the WBS to be performed under this SOW]. 1.3 Objectives This SOW shall achieve the following specific objectives: [List the specific objectives for this SOW in bullet form. Be sure they are consistent with the scope and fit within the WBS to be performed.] 2. References All applicable documents referenced in this SOW are listed below. Where appropriate, a brief annotation has been provided to indicate the relevance of the document. Specific requirements, if any, with regard to the use of these documents in performing the SOW are contained in Section 2, Requirements. 3. Requirements This section defines requirements in terms of tasks to be performed, the end results/deliverables they must produce, and the schedule of key dates. Important compliance requirements are included with the task descriptions and deliverables. 3.1 Tasks The tasks to be performed under this contract are described below in several categories. The contractor must be cognizant of all these task dimensions in order to perform them completely, correctly, and meet the Government's expectations. Task Sequence by Phase, provides a description of the work to be performed in general chronological sequence; desired methodology, states the methodology, when applicable to a specific task, that the contract shall use; available information, identifies directly applicable information that will be made available to the contractor for the performance of the work; illustrations/drawings/diagrams, if available, have been included to clarify the task effort; specifications, is a listing of documented specifications relevant to the SOW; data/property/facilities, is a listing of what the Government will provide, and when, for the performance of specific tasks; level-of-effort, states the Government's expected level of

effort for the tasks; place/travel, specifies location where contractor is expected to perform the work and any travel expected of the contractor. Task Sequence (by Phase if applicable) The contractor shall conduct the following tasks: List the tasks (no. and name) in sequential order by phase (if applicable). Provide sufficient level of detail to enable the prospective contractor to plan personnel utilization and other requirements with maximum efficiency. Desired Methodology Indicate the desired approach or methodology (e.g., Foresight, ADW, Oracle CDE) Available Information Provide for (or refer to the documents that contain) all available information that would help to assure that a contractor conducts an effective project (e.g., constraints, operational issues); mention reference documents here and list them in the separate References section. Illustrations/Drawings/Diagrams Use appropriate illustrations/drawings/diagrams (e.g., flow chart, hardware configuration) only to supplement or clarify the stated requirements, not to add further requirements. Specifications If there are existing specifications or standard paragraphs that define what you require the contractor to do, present them or incorporate them by reference rather than compose an original statement (and list them in the References section of the SOW). Data/Property/Facilities If the contractor is to use any Government-furnished data, property, or facilities in performing specific tasks, state what will be furnished and at what stage. Provide a detailed listing of what is to be furnished, and when it is to be furnished. Level-of-Effort The Government defines the nature of work to be performed as [describe] and estimates the time and numbers of personnel required to be [describe]. Place/Travel

The work under this SOW shall be performed at [describe]. The contractor shall include in its estimate the following travel: Destination

People Days

Purpose

3.2 End Results/Deliverables This section describes the products and tangible end results that are expected from each task contained in the previous section, including when applicable the use to be made of the deliverable. Also included are: the criteria a deliverable must meet to be acceptable by the Government, format requirements for document type deliverables, and the number of copies to be provided. NOTE: Periodic reports are not considered products because they are not the final result of the task but only a management tool for monitoring progress towards the completion of an end product. These requirements are discussed in Section 4, Progress/Compliance. •

List of Deliverables by Task

The following table provides a complete listing of the required deliverables by task. The table includes, Task No. and Name, End Result/Deliverable, Tool for creating it, Acceptance Criteria, and Intended Use, when applicable. Task No./ End Result/ Name Deliverable

Tool

Acceptance Intended Criteria Use

Deliverable Formats-Deliverable formats are partially dependent on the tool specified for the deliverable, but regardless of format, each must be provided with a uniform title page as follows: [Overall Program Name, e.g. Operational Data Management System] [Project Name, e.g. Aeronautical Information Subsystem] [Specific Deliverable Title (per table above)] under

[Contract Name and Number] [Task No. & Name (per table above) [mm/dd/yy] [Version Number] Prepared by [Contractor Name] [Person to Contact] [Contractor Address] [Contractor Telephone No.] Format for Microsoft Word for Windows ([version]) Documents header (mandatory)--The header shall contain (all from title page): left side: [overall program name] middle: [project name] right: [specific document title] Note: Header information shall correspond with same information on title page. footer (mandatory)--The footer shall contain: left side: Section/Page no.[#] right: [Date/Version] Note: Footer information shall correspond with same information on title page. preface (optional) table of contents (mandatory) list of figures (mandatory) abstract (mandatory) body (mandatory) appendices Format for KnowledgeWare ADW products-In the absence of specific instruction for an ADW product deliverable, the resulting product will be in accordance with steps outlined in ADW or Foresight documentation and include the kind of information found in the examples. 3.3 Schedules/Milestones

The contractor shall maintain a single project schedule in Microsoft Project for Windows ([version]) from which various project reports shall be produced. The following reports shall be provided: •

Gantt Chart

A Gantt Chart shall be provided which shows (1) Tasks (from 3.1 above) at the top level, (2) Deliverables/End Results at the Second Level (from 3.2 above), and (3) the various iterations of the deliverable (e.g., outline, draft, final) at the lowest level. The resources necessary to accomplish the tasks shall be entered at the lowest level. The report shall contain the following columns: Line Task Description/Deliverable Sched Start Dur in Days Sched Fin Pred Resources Work Effort Gannt Bars The "Task Description/Deliverable" column shall include the Task No./ Name and End Result/Deliverable exactly as contained in sections 3.1 and 3.2. The initial Gantt Chart minus resource loading and predecessors is included with this statement of work. Included are constraint dates for key deliverables established by the Government. These are key target dates the contractor must build its schedules around. In response to this SOW, the contractor shall provide a resource loaded Gantt Chart with predecessor/successor relationships included, and retaining the constraint dates established by the Government. After negotiations with the Government, the contractor shall update the schedule which will then be established as the baseline for the project. The electronic version of the baseline schedule shall be delivered to the Government following negotiations. NOTE: The contractor is also expected to maintain more detailed schedule activities at levels lower than that described above. The contractor may include or exclude, at its discretion, these activities in the schedules it provides the Government. •

PERT Chart

As part of the initial submission in response to this RFP, the contractor shall submit a PERT chart which clearly depicts the flow of task activities and deliverables. The PERT chart should convey parallel activities, the dependencies, and key convergence points. •

Who Does What When Report

The "Who does what when" report shall be provided by the contractor with the initial submission, and again following negotiations. This report will be used by the Government to assess the adequacy of the resources proposed by the contractor to accomplish the SOW. 3.4 Other Considerations

Include here any other relevant information for the performance of the SOW that does not fit elsewhere. 4. Progress/Compliance The Government requires the following from contractors in order to monitor progress and ensure compliance: •

Weekly Status Report-The contractor's project manager shall provide a brief (one page limit) status report in the following format

Last Week: Meetings attended by contractor staff (names, date, and purpose) Deliverables worked on by name/deliverable Next Week: Meetings to be attended by contractor staff (names, date, and purpose) Deliverables to be worked on by name/deliverable •

• •

•

•

Weekly Meetings-The contractor's project manager shall meet weekly with the Government's project manager, face-to-face or by telephone, as directed by the project manager. The purpose of this informal meeting is to cover any abnormalities from the weekly status report, raise issues, and generally provide a heads up for each side. Monthly Progress Report-This is a formal report which covers financial, technical, and schedule aspects of the project. A template for this report is provided below: Project Management Team (PMT) Meetings-The contractor's project manager may be required to attend the regularly scheduled meetings (usually weekly) of the PMT. The PMT is headed by the Government's project manager and includes the respective project managers from the various contractors, along with selected Government personnel such as the head of the System Integration Team. The focus of this meeting is on the coordination of work among contractors, schedule matters, and risk issues. Quarterly Program Reviews-On a quarterly basis, the entire program team consisting of the program manager, all associate program managers, and a representative from each contractor, meets to review accomplishments from last quarter, plans for the upcoming quarter, and issues/actions. This is usually a daylong meeting. Outlines and Drafts-From a technical standpoint, one of the chief ways in which the Government monitors progress and compliance is to review outlines and drafts of deliverables at frequent intervals. Although specific dates are included on the project schedule for the submission of outlines and drafts, the contractor shall be prepared to show the Government at any time it is requested "the work in progress" through the most appropriate vehicle (e.g., e-mail). The Government will use these

ad hoc requests to ensure that the deliverable is off to the right start, is on track, and that expectations are being met. 5. Transmittal/Delivery/Accessibility The contractor shall provide [x] hard copies of each deliverable and one electronic version, either on a 3.5 inch floppy disk, an e-mail attachment under cc:mail, or a special Lotus Notes Database designated by the Deliverables Process Leader. All hard copy and digitized deliveries shall be made to the Deliverables Process Leader: Angie Williams, FAA/AIS-1, Room 604, 800 Independence Ave SW, Washington DC 20591. Before making a hand delivery, the contractor shall make advance arrangements with the Deliverables Process Leader for a mutually acceptable time to make the delivery. Upon receipt, the Deliverables Process Leader will sign an "Acknowledgment Receipt" stating the number of copies received (including diskettes), the date, and the time. NOTE: If the contractor does NOT deliver the correct number of copies, this deficiency will be noted on the receipt acknowledgment; the contractor shall provide the additional copies and will not be credited with the delivery until ALL copies are received. 6. Notes If for reasons of clarity or brevity previous sections need further amplification, use this section for that purpose and for all other information that does not logically fit into previous sections. The information designed to assist in determining the applicability of the specification and the selection of appropriate type, grade, or class of the product or service. This section should included the following, if applicable: Intended use; Ordering data; Definitions, if any; Qualifications provisions; Instructions for models and samples; Miscellaneous notes. 7.0 Contractor Furnished Materials (STATE THE MATERIALS YOU WANT THE CONTRACTOR TO FURNISH). 8.0 Government Furnished Materials (STATE THE MATERIALS YOU WILL BE FURNISHING).

9. Attachments Include as attachments only those materials which are necessary to the prospective contractor's understanding of the requirement.