Did you know that the Defense Contract Management Agency (DCMA) is well on its way to implementing new methods for verifying the health of the projects and programs it monitors? This means major changes to current project management and reporting processes for government contractors of all sizes.
On one hand, DCMA’s new methods mean additional scrutiny and higher surveillance. But on the other, they bring greater efficiency, the ability to quickly and easily flag “high-risk projects,” and a monthly review of metrics in all guidelines as opposed to specific areas each month.
To help contractors better understand the impact DCMA’s new methods will have on their business, we asked Rob Edwards, Product Director for Schedule, Risk and Regulatory Complaince to break down the specifics of these changes, and explain what Deltek is doing today to help contractors prepare for tomorrow.
What happened?
Simply put, PARCA [1] (the central office for major defense authorization performance assessment, root cause analysis and earned value management) has changed the thresholds that trigger an automatic EVMS compliance review. Additionally, DCMA is leveraging technology in new ways to streamline reviews and perform comprehensive analysis on contractors’ data. In the past, DCMA would only perform validation and ongoing surveillance reviews on contracts exceeding $50 million. Now, with the new thresholds in place, reviews are required on contracts $100 million and up, but the DCMA also reserves the right to perform compliance reviews on contracts below that threshold if they believe it is warranted.
What is so different about DCMA’s new approach?
DCMA’s new approach is data-driven. They will use a combination of new metrics and analytics tools to review contractor data and identify high-risk contracts or high-risk areas within a project or program. Any contract under $100 million that has been identified as high-risk will be subject to a surveillance review. These new metrics will be employed on contracts subject to EV reporting requirements and may be used before or during a compliance review on contracts of all shapes and sizes.
How exactly will this work?
DCMA has derived a series of metrics designed to identify areas which conflict with the ANSI/EIA-748 32 criteria and the contractor’s System Description. The contractor’s monthly data will run through all DCMA’s metrics to verify compliance to the criteria. Based on DCMA’s findings, contractors could be subject to further investigation of the data and CARs (Corrective Action Reports) or surveillance reviews for specific segments of the ANSI/EIA criteria.
What does it mean for government contractors?
The fact is, DCMA’s changes mean added scrutiny, higher surveillance and a more thorough examination of contractors’ data on a regular basis. But that’s not necessarily a bad thing. As we mentioned earlier, the changes also mean that DCMA is now able to more quickly, and more easily, flag “high-risk projects” that need additional attention rather than treating each project equally. The new measures also provide government contractors with additional project insight and the opportunity to benefit from greater visibility, improved project process, higher quality data and overall better project management. Companies will need to be ready to track and produce these additional metrics for the DCMA so they can evaluate the risk level of your projects.
What is Deltek doing about it?
While many companies are only starting to wonder what these metrics are and how they will track them in the future, Deltek was made aware of these changes very early on. Since then, we have been working to make sure we have the tools ready to manage, track and report these key metrics for EVMS compliance projects on Day 1.
I encourage you to view our on-demand webinar, What the DCMA's New Data Driven Metrics Means for You [2], to learn more about these evoluationary changes and how Deltek can help you identify and mitigate the risks to your projects before it’s too late. You can access the recording here [2] any time.