Key indicators of performance system (KIPS) – providing visibility to the construction management process
National Railroad Passenger Corporation (AMTRAK)
One picture is worth a thousand words! How true this can be when the project manager wants to determine the status of a project. Books of tabular data can be distilled into concise graphical relationships and presented with the variances and trends clearly identified. The Key Indicators of Performance System (KIPS) has accomplished this for AMTRAK on the Northeast Corridor Improvement Program.
The Northeast Corridor Improvement Program (NECIP) was established by Congress to provide the Washington, D.C. to Boston, Massachusetts Railroad Corridor with dependable high-speed train travel. It is a $2.4 billion program directed by the Federal Railroad Administration of the Department of Transportation. Construction work is being accomplished by the National Railroad Passenger Corporation (AMTRAK).
The Project Control Department of AMTRAKNECIP has designed, developed, and installed a computer-generated graphics system called KIPS (Key Indicators of Performance System) for program statusing. KIPS presents multiple graphs showing cost, production, and other Key Indicators of task progress on a single page. The source data is maintained in a computer data base and can be retrieved for use in supporting analyses and special studies, as well as for KIPS.
The KIPS multiple graphs allow the reader to visually couple cost and production progress and to spot trends in various parameters. It has become a significant part of the AMTRAK progress reporting system, including the monthly reports to the Federal Railroad Administration and to the Board of Directors. This article will examine how the need for KIPS occurred, how it was implemented, the way the system operates, and the spin-off applications which have resulted from the initial KIPS requirements.
Northeast Corridor Improvement Program
Title VII of the Railroad Revitalization and Regulatory Reform Act of 1976 created the Northeast Corridor Improvement Program (NECIP). The purpose of NECIP is to improve the railroad physical plant between Washington, D.C. and Boston, Massachusetts so that regularly scheduled and dependable high-speed train service can be implemented. Current planning estimates anticipate that $2.4 billion of federal funds will be spent for that purpose.
The Department of Transportation, through the Federal Railroad Administration (FRA), contracted with the National Railroad Passenger Corporation (AMTRAK) for the NECIP construction work (See Figure 1).
AMTRAK is the owner of the Northeast Corridor and the operator of the passenger trains, so project progress can affect the current service to the public as well as future operations. Construction work is planned through 1984.
AMTRAK formed a Project Management Organization in Philadelphia during mid-1976 to implement the requirements of the contract with FRA and to direct the AMTRAK work. As part of this effort, separate cost collection and production reporting systems were developed and installed. In early 1978, a status review of these systems was conducted to determine if they were meeting the Project Control requirements and, if not, what improvements should be made.
Project Control Requirements
The review examined the tabular nature of the cost and production reporting systems, and the fact that they operate independently of each other. As part of the review, a list of requirements for a desired optimum output was developed. The key elements of the list were as follows:
• Data available on a more timely basis;
• Ability to couple cost and production information to indicate trends;
• Presentation of construction progress information in a more visible manner;
• Presentation method to be meaningful and clear to both upper management and construction management, and;
• Presentation information to support monthly project managers’ review and reports to AMTRAK Board of Directors and FRA.
Key Indicators of Performance
The review concluded that a graphical reporting technique was needed to supplement the current tabular system. From this, the Key Indicators of Performance System (KIPS) was designed and implemented.
What Is KIPS?
KIPS is a graphical technique which displays a series of parameter versus time plots relating to a specific task, on a single 8½ x 11 sheet of paper. Each plot includes the planned performance as well as the actual performance to date. The graphics are calculated and plotted by a computer system which draws its information from a central data base.
The Multiple Time/Parameter Window Concept
The use of many plots on the same page (each plot is called a window) with one axis displaying a standard time base and the other axis presenting a specific performance parameter, allows the reader to visually integrate results and make a conclusion of the task status. This process is enhanced by the proper choice of time segment, parameter segment, number of windows included on the page, and any analysis notations.
The time axis is the independent variable and is always shown in the horizontal axis. Figure 2 shows typical choices for the time segment.
The choice of the time segment is generally forced by the in-place cost and production reporting systems and by the desired frequency of the KIPS report. NECIP has daily, weekly, and monthly production reporting, and weekly and monthly cost collection reporting. However, the monthly cost report is generally not issued until 15 to 30 days after the close of the report period. This makes it too late to be used for a monthly KIPS report, which is needed 10 days after the end of the month, in order to meet contractural requirements.
For NECIP, weekly cost and production data inputs to the data base were chosen. With the data input provided on a weekly basis, the computer system was programmed to consolidate the data into monthly segments in order to present a monthly KIPS report.
An added benefit of using weekly data is the ability to update and issue interim reports (between monthly reports) if a special situation exists. For these reports, the computer system can use weekly time segments on the horizontal time axis to show more detail.
The parameter segment is the dependent variable and is always shown on the vertical axis. Figure 3 lists typical parameters used in the KIPS charts for the Track Construction program and their related units of measure. Each parameter chosen will result in a window with the parameter plotted versus time. The eight parameters listed, Cost, Production, Production Rate, Manpower, Cost Effectiveness, Forecasted Cost Variance at Completion, Productivity, and Manhours, are the ones most frequently used on NECIP. The specific production unit of measure chosen will depend upon the type of work task. For example, typical production parameters and their units of measure for trackwork are: renewing ties (choose number of ties); laying rail (choose track miles of rail), and; ballast cleaning (choose track miles). In some cases the use of specific units might not be possible. For instance, Bridge Rehabilitation work is not measured in precise units. In this case a qualitative estimate of percent completed is provided by the job supervisor.
Note that the parameter can be displayed as cumulative data or by the individual time segment (monthly or weekly data points). The choice will depend upon the desired end use of the charts.
Number of Windows
Experimentation with various numbers of windows resulted in the decision to use six to a page for the monthly reports. This allows the windows to be shown in sufficient size for the reader to make detailed observations and to see the trends. The computer system has the option to provide variations of the number of windows for other reports as desired. Figure 4 shows the typical window placement for the monthly KIPS charts.
Windows 1, 2, and 5 present cost, production, and cost-per-unit parameter information on a cumulative basis. Windows 3 and 4 show production rate and manpower on average monthly segments. Window 6 provides a forecast of cost at completion.
Window 6 on the KIPS chart is the forecasted cost variance from budget at the completion of the work task. This window does not use time for the horizontal axis, but displays the components which comprise the task (typically the four NECIP railroad divisions: Baltimore, Philadelphia, New York, and Boston), plus the task summary. The forecast is based on the current cost-per-unit of production, projected to the completion of the task. The result is presented as a percentage variance from planned cost.
Time/Window Placement Continuity
It was recognized early in the KIPS design that reader perception to graph placement on the page was important. The objective is to use the same time scale throughout a report and make the placement of the windows, from page to page, always the same.
For the KIPS monthly reports, cost is always window 1, production is always window 2, production rate is window 3, and so forth (in the order shown in Figure 4). This way, the reader becomes experienced in one chart layout. He always knows which window is cost and which window is production, and can concentrate on the message of the chart.
Window Chart Interaction
The presentation of cost and production windows, alongside one another, allows the reader's eye to quickly couple the relative progress of the task in each of these areas. By scanning down to window 6 (forecasted cost-at-completion), the integrated effect of cost and production can be seen. This allows the problem area tasks (and task parameters) that need further examination to be quickly isolated.
Computerized Data Base
The large amount of data to be entered, retrieved, calculated, and presented necessitated a computerized data base and plotting system. The use of the plots for trend analysis made accurate plotting of planned and actual data a necessity.
During the KIPS design and prior to implementing the computerized system, a manual data base was used for a number of months. The manual system required hand-plotted windows. The result was that plotting errors occurred, even though the charts were checked and double checked.
It was also difficult to maintain consistency with prior months plots whenever the chart had to be replotted in a new time increment. The mechanization of the data base and use of computer plotting eliminated these problems.
A major achievement of the mechanized data base is the ability to retrieve and to manipulate the data for calculations or additional plots without lengthy side programs. Data can be accessed for special calculations and then plotted by the computer. This allows quick turnaround for studies.
KIPS Development And Operations
The KIPS system consists of the input requirements for the computerized data base, the selfcontained data base (and related computer system), and the KIPS output results. The KIPS system is shown in the block diagram in Figure 5.
The input requirements have three major parts: the system instructions; the baseline plans, and; the progress data.
Initial programming was accomplished by Boeing Computer Services (BCS) in response to a specific set of criteria established by AMTRAK. The resultant program and the training provided to AMTRAK analysts by BCS facilitates the implementation of KIPS reporting capabilities on any of the NECIP work areas. Three points must be addressed and some programming accomplished by the AMTRAK analyst in order to establish the system instructions:
• The work tasks to be monitored must be specified;
• The level of detail of displays (compatible with the Work Breakdown Structure tree) must be specified, and;
• The time segment, the parameter segment and unit of measure definition, and the number of windows to be displayed must be specified.
The Track Work Package was the first work task where KIPS was applied. This construction effort amounts to approximately $40 million per year and is production unit oriented. The work package is divided into types of tasks and related to the Work Breakdown Structure (WBS) tree for cost collection and production reporting roll-up.
Figure 6 shows the WBS relationship within the Track Work Package for Tie Renewal & Surfacing and the roll-up of cost and production data, from milepost to division, to task, to the work package.
The Track Work Package is the funding document from FRA; contract line item reporting is provided at this level (WBS level 1). The Work Package contains a group of tasks, one of which is Tie Renewal & Surfacing (WBS level 2). Contract progress reporting is also required at the Tie Renewal & Surfacing task level. This task is divided into the four railroad divisions where the work will be performed (Baltimore, Philadelphia, New York, and Boston). It is at the division level (WBS level 3) where internal budgets are established and monitored. The specific locations where work occurs are designated by mileposts (WBS level 4). It is the milepost location where incurred costs and production data are collected by work order number.
KIPS was structured to provide displays at the division level and above. This means that the KIPS data base can be much smaller than the cost collection or production reporting data bases (i.e., data from WBS level 4 could be summarized to WBS level 3). The result is a savings in storage cost and computer time while providing the internal reporting the budget control desired.
The time segment chosen for the displays was months. The parameter segments used at the Tie Renewal & Surfacing task summary level (WBS level 2) are cost, production, production rate, manpower, cost effectiveness, and the forecast of cost-at-completion. For the divisional level displays of the task (WBS level 3), the same parameter segments are used except for the forecast parameter. A productivity parameter is substituted for the forecast to provide more detail on division performance. Therefore, six windows are used in both the summary level and the division level.
Baseline data were obtained from the track program scheduling and estimating effort, and all information was calendarized with start and finish dates. This included cost and production budget inputs and a manpower plan. This data were loaded into the data base and verified.
Actual cost incurred data are obtained from the accounting cost collection system and entered into the KIPS data base. This data includes specific cost elements such as labor, material, equipment, and other costs, as well as manhours. Production data are obtained from the production reporting system. Correlation of cost and production information in the data base is accomplished through the work breakdown structure and the work order number system.
KIPS Output Results
Examples of the Track Program Tie Renewal & Surfacing KIPS charts at the task summary and division levels are shown in Figures 7 and 8. The Tie & Surfacing task involves the removal of deteriorated crossties, replacement with new ties, and the addition of ballast (stone) around and under each tie to bring the top of the rails up to a specified level.
Tie Renewal & Surfacing Summary
Figure 7 shows the Tie Renewal & Surfacing summary chart (WBS level 2).
Planned performance is shown by the dotted lines and actual progress is shown by solid lines. Progress data are shown through the end of June. This chart includes the rollup plans and actual results of all of the divisions working on the Tie & Surfacing task in 1979.
• Window 1 - Shows the cumulative spend plan versus actual dollars spent (in thousands). Actual costs have been following the budget plan and are, in fact, slightly under plan.
• Window 2 - Shows the cumulative production plan for crossties installed versus actual number installed. Actual production is falling behind plan.
• Window 3 - Shows the daily production rate for tie installation averaged over the entire month. In this example, the production rate has not met the planned rate, but there is an improvement trend shown.
The step-down in planned production rate beginning at the end of August is caused by Baltimore, Philadelphia, and Boston Divisions’ plans to complete work before the end of the year. New York work continues through December.
• Window 4 - Shows the manpower plan versus the actual manpower applied to the task. The dotted line is the plan, showing the step-down in manpower as the divisions finish their production. The broken line is straight time hours and the solid line is the total of straight time and overtime hours. Data through June show that the divisions have not applied manpower as planned and that total overtime was reduced in June.
• Window 5 - Shows the cumulative cost-per-unit versus planned cost-per-unit. Here we see that overall cost per tie has been running above planned cost.
• Window 6 - The projection of cost at completion integrates all the data from the other five windows. Each of the divisions which have Tie & Surfacing task effort in 1979 has its forecasted cost-at-completion of production shown. Baltimore is running slightly over plan, with a projected 3%overrun. Philadelphia is doing better than planned, and has a 4% underrun projected. The major problem area is the New York Division, which is not meeting its budget and has an 11% overrun projected. If current conditions continue, the total Tie & Surfacing task will be 6% over the cost budget at completion of all the division work.
There are six months of the work season remaining, so time is still available for corrective action. The New York problem area can be reviewed in further detail by looking at the KIPS Divisional chart.
Also, the Baltimore Division chart can be examined to determine if the small overrun has an increasing or decreasing trend.
Tie Renewal & Surfacing, New York Division
Figure 8 shows the planned and actual performance of the New York Division. The definitions of window one through five and the window positions are identical to the layout on the summary display.
Key Indicators of Performance (KIPS) TIE & SURFACING - NEW YORK
• Window 1 - Cost is running right on the budget line.
• Window 2 - Production is lagging behind plan.
• Window 3 - Production is lagging behind plan.
• Window 4 - The improvement in May production resulted from increased overtime. Note that the Division Manager held the total hours worked approximately constant.
• Window 5 - The cost per unit is decreasing so the decision of more overtime in May and June has been cost effective. However, the forecast is for an 11% over budget completion so additional management action will have to be taken to bring the final costs within plan.
• Window 6 - Shows the manhours per tie installed (including the surfacing operation). This parameter is used for cost estimating and improvement curve analysis.
Tabular data can be printed to supplement the graphical analysis. The feedback of information to the New York division manager, in this example, provides guidance on the alternative strategies to follow.
Support Systems And Implementation
The equipment used in the basic KIPS system is shown in Figure 9.
A Tektronix 4014 terminal with a 19 inch display screen is used for data retrieval purposes. The output is checked prior to printing. The charts and the data are printed using the hard copy printer. An X-Y plotter can be connected to the system for oversize or color plots, if desired.
The system is operated by one analyst. He is responsible for all data entry, including ensuring that plans and actuals are correctly loaded into the data base, and for operating the system to produce the charts. The analyst also programs models for new or revised reporting or analysis requirements. By using in-house personnel, a desired new report format for analysis can be transformed from request to report very quickly.
The analyst can control the plotting of data by specifying the scale on the vertical axis. In this way, more detail can be displayed. Otherwise, the system automatically selects a scale to include the maximum data point.
Computer Systems and Programs
KIPS uses the BCS Executive Information System software package. Data entry is performed in Philadelphia and the information stored and calculations performed at the BCS computer center in McLean, Virginia.
Shortly after the Project Control review in early 1978, a KIPS statement of work was prepared and cost estimates for initial development usage were obtained from BCS. KIPS was initially issued in handplotted form for several months while cost and equipment paperwork was being processed. The BCS development and programming, training of AMTRAK personnel, and equipment installation and checkout, were completed in January, 1979. Since then, the computer-generated charts have been used on NECIP monthly reports to the AMTRAK Board of Directors and FRA, Quarterly FRA Reviews, and for internal statusing purposes.
KIPS Use as an Analytical Tool
The use of the graphical technique has obvious advantages over the exclusive use of tabluar data. KIPS has the capability to provide both graphics and the tabular printout. The versatility provided by the data retrieval, formating, and vertical scale management provides an extra dimension to the work of the analyst.
The graphical technique lends itself to an annotation of the problem areas by the analyst. This can highlight the situation without lengthy reports being written to explain status to the manager. The graph makes the task progress (or lack of progress) very evident.
Although KIPS was developed to support monthly statusing requirements, its application for other purposes has become readily apparent. Figure 10 identifies some of the additional uses that have been found for KIPS.
• Task Directive Statusing - Internal project budgets and work programs are issued by the Task Directive System. KIPS is used to provide internal statusing to management and construction personnel.
• Task Directive Budgets - A KIPS program is used to calendarize the cost estimate data and convert it into a budget plan for Task Directive use.
• Window Alternate Configurations - Special reports have been generated with other than the standard six window format. Two windows have been used for top level summaries, and other groups of parameter windows have been used to meet analysis requirements.
• Productivity Studies - Productivity studies are carried out and the data presented using KIPS.
• Estimating Data Base - The KIPS data base information is used for an estimating base.
• NECIP Forecasting System - The initial work done on KIPS window 6 (forecast of cost at completion) has been expanded to include forecasts of production as well as cost. Algorithms have been developed which also provide intermediate point forecasts.
KIPS has provided significant visibility to progress statusing by use of the graphical technique and data base system. The errors and slow turnaround of manual plotting have been overcome and the data base provides rapid retrieval and presentation for analysis.
Specific advantages of KIPS includes:
• Cost and production data are visually coupled and the results integrated in the forecast window;
• The graphical display versus time provides a means to detect trends;
• The display of multiple parameters on a single page makes the results easily understood;
• Several levels of data can be plotted, as desired, to show more detail;
• Graphical displays can be supplemented with tabular information, and;
• Alternate strategies can be proposed and analyzed to determine the best approach.
The KIPS technique and system can be used on any project where its size makes it necessary for data handling to be computerized.
Douglas S. Egan, Director, Programs Control, AMTRAK, Northeast Corridor, is responsible for the planning, scheduling, analysis, reporting, and contract administration functions on a $2 billion railroad improvement project.
The author wishes to acknowledge the efforts of several AMTRAK personnel: Mr. C.S. Doukakis, Analyst, and Mr. E.T. Beswick, Senior Analyst, for developing the KIPS concept into reality and for operating the KIPS system, and Mr. M.J. Liebow, Managing Director, Financial and Program Control, for advice on systems development.
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1This article was previously published in the 1979 Proceedings of the Project Management Institute, 11th Annual Seminar/Symposium, Atlanta, Georgia.