Using Earned Value Information to Predict Program Cancellation

Report Number: NPS-AM-14-183

Series: Acquisition Management

Category: Earned Value Management (EVM)

Report Series: Sponsored Report

Authors: Diana Angelis, Laura Armey and Sidney W. Hodgson III, CMDR, USN

Title: Using Earned Value Information to Predict Program Cancellation

Published: 2014-08-01

Sponsored By: Acquisition Research Program

Status: Published--Unlimited Distribution

Research Type: NPS Faculty

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Keywords: Acquisition, Earned Value, Survival Analysis, Cost Growth


Since 2001, 12 major defense acquisition programs (MDAPs) have been cancelled. Although each of these programs had problems with cost or schedule overruns (or both), there were other MDAPs that had similar problems and were not cancelled. Is it possible that program managers had information that might help determine which program was likely to survive and which was more likely to be cancelled? We employ a unique and rigorous statistical methodology to help program managers and their overseers understand and quantify the risk to their programs based on key earned value metrics. We compare programs that were cancelled to programs that had significant cost overruns but were not cancelled. We use survival analysis to investigate whether differences in key EV metrics reported for cancelled programs and