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Slide 1 - AACE International


									The Use of Professional Credentialing in Helping
    to Establish a Cost Estimating Capability

                         Michael R. Nosbisch, CCC, PSP
                               President - Elect
• Introduction
   – Speaker
   – AACE International
• Professional Credentials/Certification
   –   Definition and attributes
   –   Certification vs. licensure
   –   General types of certifications
   –   Specific examples of estimating-based certifications
       (all associations)
• The Role of the PMO
• Conclusion
• Speaker Background
  – General
     • More than 22 years of project management/controls experience
     • Named contributor to GAO Cost Guide
  – Specific
     • Currently hold multiple professional certifications
     • Member of task force that developed both an internal (Parsons) and
       external (AACE) certification
     • Currently President – Elect of AACE International
         – Will [soon] have responsibility for administration of 6 existing
         – Management of development process in relation to any new
• AACE International (Association for the
  Advancement of Cost Engineering)
  – Founded in 1956, currently largest global organization
    dedicated to furthering concepts of total cost
    management and cost engineering

  – 8 regions

  – 91 sections

  – 7,708 members
     • According to 2010 Membership Survey, 22% of respondents
       were Estimators by primary job function
           AACE International
• Cost Engineering defined as the collective set of practice areas
  that includes the following:
   –   Business and program planning
   –   Cost estimating
   –   Economic and financial analysis
   –   Cost control
   –   Program and project management
   –   Planning and scheduling
   –   Cost and schedule performance measurement
   –   Change control
• Total Cost Management (TCM) is the "process" through which
  these practices are applied
   – Encompasses multiple “Recommended Practices” related to estimating,
     including “Cost Estimate Classification System: As Applied in [EPC] for the
     Process Industries” (JAN 2011)
        AACE International
• DOE Relationship
  – Cooperative agreement first signed in 1997
     • Reauthorized in 2002 and 2007
  – Current DOE “sponsor” is OECM
  – Key elements:
     • Advance “state-of-the-art” of TCM through
       increased communication and dialogue
     • Apply established cost engineering/cost management principles,
       proven methodologies, and latest technology
     • Develop new cost engineering/cost management methodologies and
       technology in pursuit of optimum resource utilization
     • Encourage utilization of cost management standards and practices
       and their continual improvement/advancement
Professional Credentials/Certification
• Definition
   – A designation earned by a person to assure qualification
     to perform a job or task
• Attributes
   – Most are created, sponsored, or affiliated with
     professional associations, trade organizations, or IT
     vendors interested in raising standards
   – In general, must be renewed periodically, or may be valid
     for specific period of time
      • As part of renewal process, common for individual to show
        evidence of continued learning (PDUs, CEUs, etc.)
    Certification vs. Licensure
• Licensure is when demonstration of ability or knowledge is
  required by law before being allowed to perform a task/job
   – In U.S., professional licenses are usually issued by state agencies
     (e.g. professional engineer)
• Certifications are usually earned from a professional society or
  educational institute, not the government
   – For some organizations, certification assessment process is very similar or
     even same as licensure
       • May differ only in terms of legal status
   – Independent “accreditation” often times sought to strengthen
     validity of process
       • American National Standards Institute (ANSI)
       • Council of Engineering & Scientific Specialty Boards (CESB)
  General Types of Certifications
• Internal certifications
   – Developed by a company/corporation for internal
   – Limited “portability” to other companies/corporations
   – Examples:
      • Corporate
         – CAM certification for specific projects/contracts with EVMS
         – Parsons Project Controls Management certification program
      • Government
         – DoD’s DAWIA certification for acquisition professionals
         – Tri-Service Cost Engineering Certification Program
         – DOE’s PMCDP for FPD certification
 General Types of Certifications (cont’d)

• Product-specific certifications
  – More involved, since they are intended to be
    referenced to a product across all applications
     • Portable across locations, but not across other
  – Very prevalent in information technology (IT)
    industry, where personnel are certified on a
    version of software or hardware
 General Types of Certifications (cont’d)

• Profession-wide
  – Most “general” type of certification
     • Intended to be portable to all places a certified professional
       might work
     • This generalization increases the cost of such a program,
       since the process to establish legally defensible assessment
       of an entire profession is very extensive
  – 3 types prevalent in project/cost management
     • Knowledge-based
                             In U.S. most are a combination of these two
     • Experience-based
     • Competency-based
  Estimating-based Certifications
• General
   – Certified Cost Consultant/Certified Cost Engineer (CCC/CCE)
      • First offered by AACE in 1976
      • Accredited by CESB
      • Focuses on estimating as component of cost engineering
   – Project* Management Professional (PMP)
      • First offered by Project Management Institute (PMI) in 1984
      • Accredited by ANSI
      • Focuses on estimating as component of project management
   – Certified Construction Manager (CCM)
      • First offered by Construction Management Association of America
        (CMAA) in 1995
      • Accredited by ANSI
      • Focuses on estimating as component of construction management
  Estimating-based Certifications
• Specific
  – American Society of Professional
    Estimators (ASPE)
     • Certified Professional Estimator (CPE)
        – First offered in 1976
        – Accredited by CESB
        – Targeted specifically at construction estimators
        – Process consists of educational workshop, writing a 2,500 word
          acceptable technical paper on estimating, and completing two
          examinations (general knowledge and discipline-specific)
        – To be eligible to sit for exam, applicant must have at least five
          years experience in one discipline of professional estimating
          (mechanical, electrical, landscaping, etc.)
  Estimating-based Certifications
• Specific (cont’d)
   – Society of Cost Estimating and Analysis
       • Certified Cost Estimator/Analyst (CCE/A)
           – First offered in 1990
           – Body of knowledge required includes estimating in all fields of
             engineering, not just construction
           – Exam focuses on various methods of analyzing cost of project, as well as
             estimating models like parametric estimating and comparison estimating
           – To be eligible to sit for exam, applicant must fall within one of three
               1.   College degree heavy in cost estimating/analysis and two years experience
                    in cost estimating/analysis
               2.   Associate’s degree and five years experience as described above
               3.   Seven years of experience with submission of biographical sketch
                    demonstrating education, experience and relevant performance
  Estimating-based Certifications
• Specific (cont’d)
   – International Society of Parametric Analysts
      • Certified Parametric Practitioner (CPP)
          – First offered in 2002
          – Provides professional recognition of practitioner’s education, job
            experience, knowledge, and skills in parametric estimating/analysis
          – To be eligible to sit for exam, applicant must have either:
              1.   College degree in field of study directly related to parametric
                   analysis and two years experience performing parametric analysis
              2.   Associate degree and five years of experience in parametric
              3.   Seven years of experience in parametric analysis with submission
                   of brief biographical sketch demonstrating applicant’s ability or
                   knowledge to pass examination
  Estimating-based Certifications
• Specific (cont’d)
  – AACE International (Association for the Advancement
    of Cost Engineering)
     • Certified Estimating Professional (CEP)
        – First offered in 2008
        – CESB accreditation in process
        – Not specifically targeted toward construction estimators, but
          majority of examples are construction-oriented
        – To be eligible to sit for exam, applicant must:
             » Have at least 8 full years of professional experience, of which
               up to 4 years may be substituted by college/university degree
             » Agree to adhere to the AACE Canon of Ethics
       The Role of the PMO
• Project Management Office (PMO) defined
  – Organizational entity chartered to perform in capacity that
    achieves one or more operational objectives of project
     • Oversight
     • Control
     • Support
  – Ideally, should encompass all people, processes, and tools that
    manage or influence project performance
     • Help PM and “relevant organization” understand and apply
       professional practices of project management
         – Relevant organization is business unit or department influenced by PMO
           functions & in receipt of direct business benefits from PMO operations
         – What about for an LLC?
      The Role of the PMO
• Development of Certification Program
  – Should be priority of PMOs as key component of
    career development
  – Both external and internal certifications should be
    considered when defining what will be pursued
     • External serves to obtain third-party validation of
       professional competency against widely accepted
     • Internal allows PMO to consider industry-specific issues as
       well as applicable organizational and business interests
     • In some organizations, both forms are used
             Role of the PMO
• PMO’s contribution to development process*
  – Define relevance of certification
      • What will certification do for the individual?
      • How will it benefit the relevant organization?
  – Specify certification program target group
      • For whom is certification mandatory?
      • Who is eligible for optional entry into program?

  * Will likely be done in collaboration with HR or Training Department
           Role of the PMO
• PMO’s contribution to development process (cont’d)
  – Determine certification program implementation
     • Individual completion time limits or constraints
     • Multiple and repeat attempts at certification
     • Options for any “grandfathering” (if mandatory)
  – Construct certification criteria
     • For internal certifications only
         – Definition of body of knowledge
         – Skill and performance objectives to be achieved by individuals
         – Other business or professional qualifications required for individual
 Role of the PMO: Some Practical Applications

• Offering incentives for achieving specific external certifications
    – Spot bonus
    – Salary increase
    – Limited number of certifications or not?
• Requiring achievement of external/internal certification within a set
  amount of time
    – Often times one year period from date of hire/promotion is used
    – Challenge is not only defining what penalty will be for non-compliance, but
      actually enforcing it
• Requiring internal certification, but allowing external certification to be
  substituted for certain elements
    – Converse (and more difficult) is requesting that an internal certification be
      substituted for certain elements of a sought after external certification
• Subject of certification was discussed extensively at
  recent meeting of EFCOG Cost Estimating Subgroup
  – No real consensus on level/scope of what should be
    required vs. recommended as best practice
  – Bob Raines of OECM then concluded the discussion with
    following observation:
     • “Similar to how a P.E. is required to stamp a construction
       design, then so should a certified estimator be expected to
       sign off on a *complex+ construction estimate”
  – Do you agree?
Association/Certification Websites
•   AACE International:
•   PMI:
•   CMAA:
•   ASPE:
•   SCEA:
•   ISPA:

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