For development work to be accomplished  prior to this date, NARA is to prioritize existing requirements and develop  realistic cost and schedule estimates to determine what can be  accomplished by the deadline. NARA Has Yet to Fully Establish Most EVM Practices to Manage the ERA Acquisition

NARA has, to varying degrees, established certain best practices needed to  manage the ERA acquisition through EVM. These weaknesses exist in part because NARA lacks a comprehensive  EVM policy, as well as training and specialized resources. NARA also  frequently replans the ERA program. Without effectively implement EVM, NARA has not been positioned to identify potential cost and  schedule problems early and thus not been able to take timely actions to  correct problems and avoid program schedule delays and cost in creases. However, critical weaknesses remain in the following other key practices:   program    Define the scope of effort using a work breakdown structure. Without a  work breakdown structure that is comprehensive, product-oriented, and  standardized, ERA cannot efficiently track and measure progress made on  contractor deliverables. Forecast estimates at completion. crement 4, they anticipated a cost overrun of $2.0 million. However, in  Moreover, while ERA earned value data trends are included in briefing  materials provided to NARA senior executives, these cost and schedule  performance trends are not Until NARA uses earned value data to make program decisions, it will be  unable to effectively identify areas of concern and make recommendati to reverse negative trends. ERA’s Earned Value Data Do Not Reflect True Program Sta tus or the Magnitude of Future Cost and Schedule Increases

ERA’s earned value performance trends do not accurately portray prog status, and our analysis of historical program trends indicate that future  cost and schedule increases will likely be significant. We further project that the total cost overrun incurred at the end  of the program life cycle will likely be between $205 million and $405  million. Appendix I: Objectives, Scope, and Methodology

Our objectives were to (1) assess whether the National Archives and  Records Administration (NARA) is adequately using earned value  management (EVM) techniques to manage the Electronic Records  Archives (ERA) acquisition and (2) evaluate the earned value data to  determine ERA’s cost and schedule performance. Specifically, we compared program documentation  with EVM and scheduling best practices as identified in GAO’s cost guide.
Why GAO Did This Study

Since 2001, the National Archives and Records Administration (NARA) has been working to develop an Electronic Records Archive (ERA) to preserve and provide access to massive volumes and all types of electronic records. However, in acquiring this system, NARA has repeatedly revised the program schedule and increased the estimated costs for completion from $317 million to $567 million. NARA is to manage this acquisition using, among other things, earned value management (EVM). EVM is a project management approach that, if implemented appropriately, provides objective reports of project status and unbiased estimates of anticipated costs at completion. GAO was asked to (1) assess whether NARA is adequately using EVM techniques to manage the acquisition and (2) evaluate the earned value data to determine ERA's cost and schedule performance. To do so, GAO compared agency and contractor documentation with best practices, evaluated earned value data to determine performance trends, and interviewed cognizant officials.

What GAO Found

NARA has, to varying degrees, established selected best practices needed to manage the ERA acquisition through EVM, but weaknesses exist in most areas. For example, the scope of effort in ERA's work breakdown structure is not adequately defined, thus impeding the ability to measure progress made on contractor deliverables. These weaknesses exist in part because NARA lacks a comprehensive EVM policy, training, and specialized resources and also frequently replans the program. As a result, NARA has not been positioned to identify potential cost and schedule problems early and thus has not been able to take timely actions to correct problems and avoid program schedule delays and cost increases. ERA's earned value data trends do not accurately portray program status due to the program's weaknesses in implementing EVM; however, historical program trends indicate that future cost overruns will likely be between $195 million and $433 million to fully develop ERA as planned and between $205 and $405 million at program end. In contrast, the contractor's estimated cost overrun is $2.7 million. Without more useful earned value data, NARA will remain unprepared to effectively oversee contractor performance and make realistic projections of program costs.

What GAO Recommends

GAO recommends, among other things, that NARA establish a comprehensive plan for all remaining work; improve the accuracy of earned value performance reports; and engage executive leadership in correcting negative trends. NARA generally concurred with GAO's recommendations.