In my first blog of this series I introduced you to the Four Pillars of the Affordability Process (As a reminder: the definition of Affordability is: Affordability is the process that balances performance with price to meet customer needs.). They are:

  1. Management Support
  2. Methodology
  3. Training
  4. Tools/Automation

In this second blog, I will give you my insight and write specifically about the First Pillar: Management Support.

It is my personal experience that Management Support of the Affordability Process is the single most important factor that will enable Affordability to flourish on a program and within a business. Why is this? It is primarily due to what an involved Management can do for you and the Affordability effort on your program. Management can do four things to show its commitment to and support of the Affordability Process:

  1. Provide funding ($) at the right time and in the correct amount
  2. Establish Affordability Metric Measurements and Enforcement
  3. Employ a Positive Reward System
  4. Remove Barriers to Affordability

For an Affordability effort to be viable on a program it must be funded. This funding must support a robust Affordability Program and ensure that all that needs to be done with respect to Affordability can be paid for. Even if a program manager must cut back somewhere in a program, it cannot be from these funds. Funds need to be allotted for Affordability in the program plan and if needed, supported by business funds provided separately. Making sure that funds are available helps to change the culture and embed in it a sense that Affordability and cost reduction is important.

Work that is measured is work that is done. If Management makes the commitment to develop Metrics that measure its Company Priorities (Affordability being one of them) then those priorities will be met. Tying performance reviews and measuring progress toward Affordability Goals is a metric that is required to make sure Affordability is addressed. At each program design review and IPT Design Team meeting the Affordability Metrics and plans for meeting goals must be addressed.

Rewarding Program Managers and IPTs for implementing the Affordability Methodology on a program helps ensure its success. It is important for Managers to recognize and hold up as positive examples Programs, Program Managers, and IPT Members that have been successful in meeting their goals and reducing program cost by following Affordability processes and procedures.

When barriers get in the way of cost reduction and Affordability implementation on a program it is Management’s responsibility to remove those barriers. Typical barriers that must be overcome are:

  1. Insufficient funding for Affordability effort – ensure adequate funding in the proposal for Affordability; provide additional funding from overhead funds as needed.
  2. Lack of Affordability expertise and experience – assign an Affordability expert to support the program; assign Affordability Management as collateral duty to a person on the program.
  3. Lack of Affordability knowledge by IPT Members – provide funds to train program IPT members in Affordability methodology and its application.
  4. Lack of support for Affordability – implement metrics that measure and support implementation of Affordability; performance evaluations include measurement of support for and implementation of Affordability Methodology and processes.
  5. Use of standardized reports – require the use of standardized reports and formats relating to Affordability.
  6. No Affordability Metrics – create and require the use of standardized Affordability Metrics.

In conclusion, all Management effort toward supporting Affordability within a business should have the ultimate goal of creating an environment and culture where Affordability is important, supported, rewarded, and part of the way the business is managed and run. It should be a discriminator for the business. Only Management Support of Affordability can have the far-ranging impact needed for its success!