CDFM Performance Management and Metrics 2 — Questions and Answers
Question 1: What is the primary tool DoD uses to track program cost, schedule, and technical performance on major defense acquisition programs?
- Earned Value Management (EVM) (Correct answer)
- Cost-Benefit Analysis (CBA)
- Return on Investment (ROI) Analysis
- Zero-Based Budgeting (ZBB)
Correct answer: Earned Value Management (EVM)
Earned Value Management (EVM) integrates cost, schedule, and technical performance data to give program managers an early warning of variances and forecast final program costs.
Question 2: In Earned Value Management, what does a negative Cost Variance (CV) indicate?
- The program is under budget
- The program is over budget relative to work accomplished (Correct answer)
- The program is ahead of schedule
- The program has exceeded its performance baseline
Correct answer: The program is over budget relative to work accomplished
A negative Cost Variance (CV = Earned Value minus Actual Cost) indicates that the program has spent more than the value of work actually accomplished, meaning it is over budget.
Question 3: What is a 'key performance parameter' (KPP) in DoD acquisition and performance management?
- A mandatory threshold that a system must meet; failure to meet it triggers program review or restructuring (Correct answer)
- A target cost for a defense acquisition program
- A benchmark comparing DoD performance to private sector standards
- A metric used only during initial operating capability testing
Correct answer: A mandatory threshold that a system must meet; failure to meet it triggers program review or restructuring
A Key Performance Parameter (KPP) is a critical capability attribute that a system must meet; failing to achieve a KPP threshold is a significant event that typically triggers a program review or restructuring.
Question 4: Under the Planning, Programming, Budgeting, and Execution (PPBE) process, what phase focuses on assessing program execution against planned performance?
- Planning
- Programming
- Budgeting
- Execution (Correct answer)
Correct answer: Execution
The Execution phase of PPBE focuses on implementing approved programs, assessing actual performance against plans, and feeding lessons learned back into future planning cycles.
Question 5: What is the purpose of a 'Program Budget Decision' (PBD) issued by OSD during the PPBE process?
- To direct specific funding adjustments to military department budgets during the budgeting phase (Correct answer)
- To authorize reprogramming of funds mid-year
- To approve new acquisition programs above ACAT I threshold
- To certify the DoD financial statements for audit
Correct answer: To direct specific funding adjustments to military department budgets during the budgeting phase
A Program Budget Decision (PBD) is an OSD document that makes specific adjustments to military department or defense agency budget submissions during the budgeting phase of PPBE.
Question 6: What does the Schedule Performance Index (SPI) measure in Earned Value Management?
- The ratio of planned cost to actual cost
- The ratio of earned value to planned value, indicating schedule efficiency (Correct answer)
- The number of milestones completed versus planned
- The percentage of contract options exercised on time
Correct answer: The ratio of earned value to planned value, indicating schedule efficiency
The Schedule Performance Index (SPI = EV ÷ PV) measures schedule efficiency; an SPI below 1.0 indicates the program is behind schedule relative to the work planned.
CDFM Performance Management and Metrics 2
What is the primary tool DoD uses to track program cost, schedule, and technical performance on major defense acquisition programs?