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NASA
Procedural
Requirements

NPR 8600.1
Effective Date: April 22, 2019
Expiration Date: November 01, 2024

COMPLIANCE IS MANDATORY FOR NASA EMPLOYEES

Subject: NASA Capability Portfolio Management Requirements

Responsible Office: Office of Strategic Infrastructure

Chapter 2. Managing Capability Portfolios

2.1 Capability Portfolios and Components

2.1.1 The MSC initiates efforts to establish a CP and designates a sponsoring Mission Directorate. Sponsoring Mission Directorates conduct activities to establish the CP. The MSC determines when a CP and its constituent capability components are ready for strategic and centralized management to meet customer requirements for products and services in the most effective and efficient way possible.

2.1.2 A CP comprises specifically identified capability components that fall within the CP scope and their enabling infrastructure as defined in the Capability Portfolio Commitment Agreement (CPCA) and the Capability Portfolio Management Plan (CPMP).

2.1.3 Assets may be excluded from the portfolio if they:

a. Do not meet the minimum thresholds for the portfolio defined in the CPCA and the CPMP (e.g., a minimum test section area for wind tunnels).

b. Are sustained "tools of the trade."

c. Are used in specialized applications (e.g., low Technology Readiness Level (TRL) for research and development).

2.1.4 Capability components within a CP compose the underlying structure for delivering products and services to customers. They are typically distributed geographically across multiple Centers.

2.1.5 The sponsoring Mission Directorate ³ Associate Administrator (MDAA) selects a CP manager to strategically and centrally manage the CP.

³ The Mission Support Directorate is a Mission Directorate.

2.1.5.1 The CP manager reports through the MDAA and should strive to maintain an Agency perspective and objectivity in decision making.

2.2 Capability Portfolios: Establishment, Strategic Management, and Termination

A CP goes through three main sets of activities: Establishment, Strategic Management, and Termination.

2.2.1 Establishment

When NASA leadership determines that it may be in NASA's best interest to strategically and centrally manage a group of functionally similar capabilities in an integrated manner, the MSC initiates Establishment of a CP. Establishment activities include scoping the portfolio, designating its sponsoring Mission Directorate, identifying the portfolio capability components and enabling infrastructure of the portfolio, developing a management strategy and approach, designating a CP manager, and preparing the CPCA. A decisional review is held at the MSC to determine whether to formally establish a CP and transition to strategic and centralized management status, i.e., transition to Strategic Management activities.

2.2.2 Strategic Management

The Strategic Management of a portfolio comprises key CPM activities that repeat throughout the portfolio's lifespan. These activities include the following:

a. Maintaining a strategy.

b. Supporting the budget process.

c. Securing funding.

d. Evaluating portfolio capability components and assets for need of maintenance, upgrade, or divestment.

e. Analyzing the capability domain inside and outside of NASA.

f. Understanding capability supply and demand.

g. Assigning customer requirements to capability components that can deliver products and services in accordance with the approach for making sourcing decisions.

h. Assessing the health of the CP and its components.

i. Identifying and implementing new capabilities and improvements to the CP to meet future needs.

2.2.3 Termination

When NASA leadership determines that it is no longer in NASA's best interest to strategically and centrally manage a CP in an integrated manner, the MSC initiates Termination of the portfolio. A Termination decision triggers the development of a Termination strategy and plan; the closing out of all activities associated with the management of the CP; and the reassignment of the portfolio's capability components and enabling infrastructure to Center management in accordance with the Termination strategy.

2.2.4 Figure 2-1 depicts activities of Establishment, Strategic Management, and Termination of a CP.

Figure 2-1 Capability Portfolio Activities

2.3 Key Tenets for Management of Capability Portfolios

2.3.1 Stakeholders and Governing Documents

2.3.1.1 CPs have multiple stakeholders, such as Centers, participating Mission Directorates, Office of the Chief Engineer (OCE) Technical Fellows, Office of the Chief Information Officer (OCIO), and multiple customers. The CP manager works collaboratively with stakeholders and customers to understand current and future demand for portfolio products and services and to balance the portfolio capability components and available Agency resources with that demand.

2.3.1.2 The CP manager works collaboratively with Centers that have portfolio capability components to develop and implement processes for strategically and centrally managing the CP and its components and to establish operational norms and thresholds. These processes, operational norms, and thresholds, which may differ from one CP to another, are documented in the CP governing documents, the CPCA and/or the CPMP. The CP manager manages and conducts all activities of the CP in accordance with the CPCA and CPMP.

2.3.1.3 Centers manage, maintain, and operate the portfolio capability components in accordance with the agreed-upon processes documented in the CPCA and CPMP.

2.3.2 Ensuring Consistency with Capability Portfolio Plans and Direction

2.3.2.1 CP managers are responsible for ensuring that investments, divestments, acquisition strategies, procurements, or internal and external agreements that seek to either build or develop new capabilities or improve or divest of existing capabilities, whether NASA or NASA investment in a non-NASA capability, are consistent with the established and approved plans and direction of the CP.

2.3.2.2 CP managers are responsible for ensuring that acquisition strategies, procurements, or internal and external agreements that seek to obtain products and services from external capabilities or commit the use of capability components, are consistent with the established and approved plans and direction of the CP. (Products and services from external capabilities that are procurement line items included in a product delivery are excluded; e.g., a spacecraft build and test delivery.)

2.3.3 Concurrence Processes, Engagement Points, and Methodologies

2.3.3.1 CP managers utilize concurrence processes to ensure consistency with established and approved plans and direction of the CP. Concurrence is required under specific thresholds, constraints, criteria, and/or circumstances. Guidelines for when concurrence should be obtained are established by engagement points. The concurrence processes, thresholds, constraints, criteria, circumstances, and engagement points are documented in the CPCA and the CPMP.

2.3.3.2 Defined engagement points are essential for ensuring concurrence takes place as early as possible in the MDAA, Center, and program and project management timelines, review cycles and decision-making processes. Early engagement points ensure that the plans of the MDAA, Center Director, JPL Lab Director, program manager, and project manager are consistent with CP-approved plans and directions.

2.3.3.3 Various methodologies may be applied to adapt the concurrence processes to engagement points. These methodologies are documented in the CPMP. The methodologies may be implemented at the individual strategy, procurement, or agreement level, or at an integrated Center level on a periodic basis.

2.3.3.4 The methodologies and engagement points for obtaining CP manager concurrence or non-concurrence may vary. For example, for competed missions a statement may be inserted into applicable Announcements of Opportunity (AOs) covering the requirements of this policy directive.

2.3.4 Project Management and Capability Portfolios

2.3.4.1 The environment in which CPs exist is dynamic. The nature of customer requirements may change over time, requiring changes to the capability components that compose the portfolio. These changes may include improvements to existing components or the addition of new components. These changes are subject to:

a. The concurrence processes and thresholds described in Section 2.3.3 and elsewhere in this NPR.

b. Approval by the MSC at a decisional review if they exceed thresholds, criteria, and constraints for a significant change documented in the CPCA. (See Appendix C, Section 4.0.)

c. Approval by the sponsoring MDAA if they exceed thresholds, criteria, and constraints for CP actions and changes documented in the CPMP. (See Appendix D, Section 3.5.)

2.3.4.2 Various means may be used to implement improvements to existing components or the addition of new components, ranging from tasks implemented under Center procedures to major projects implemented under Agency project management NPRs (i.e., NPRs 7120.5, 7120.7, 7120.8, and 8820.2). Projects may be proposed by the CP manager, a NASA program, or a Center.

a. Based on capability gaps, the CP manager may propose projects, associated funding requirements and funding sources, and an implementing Center. Following approval by the sponsoring MDAA and/or the MSC (if required), the project is assigned to a Center for implementation. The implementing Center selects the project manager, coordinates with the CP manager on the appropriate governing NPR and on project requirements, and provides oversight of project implementation.

b. A NASA program or Center may independently propose projects based on needs identified by a program or Center. When a proposed project is subject to CP concurrence processes based on thresholds defined in the CPMP, the CP manager and the program or Center work collaboratively early in the project Formulation Phase, and the CP manager provides guidance, requirements, and/or recommendations for the project culminating in the CP manager's concurrence or non-concurrence on the proposed project's plans related to the capability domain. A non-concurrence may be addressed through the appeal process documented in the CPMP. Following CP manager concurrence, approval by the sponsoring MDAA, and/or the MSC (if required), and approval by the project's governing authority, the project is implemented under the authority of the NASA program or Center in accordance with the appropriate governing NPR.

2.3.5 Capability Portfolio Sourcing Strategies and Sourcing Decisions

2.3.5.1 CP sourcing strategies and sourcing decisions play an integral role in CPM. The sourcing strategy and approach for making sourcing decisions are documented in the CPCA and the CPMP. In all cases, the CP sourcing strategy and sourcing decisions will be consistent with constraints established in awarded and existing contracts and agreements.

2.3.5.2 The sourcing strategy is a strategy for acquiring portfolio products and services through capabilities available in-house and through other agencies, vendors, partners, and academia. The sourcing strategy goal is to achieve an optimized portfolio that addresses Agency goals and objectives, supports the CP strategy, enables the CP's strategic direction, and fully satisfies customer requirements.

a. CP managers establish the sourcing strategy in collaboration with Mission Directorates and Centers. The sourcing strategy is described in the CPCA and documented in detail in the CPMP. The sourcing strategy may vary from one CP to another and within a CP.

b. The sourcing strategy is periodically reevaluated to achieve an optimized portfolio including adjustments in response to changes in the products and services required by customers and changes in internal and external capabilities.

2.3.5.3 Sourcing decisions are the assignment of customer (NASA and external) requests to capability components. The approach for making sourcing decisions is described in the CPCA and documented in detail in the CPMP.

a. Responsibilities for sourcing decisions may be delegated by the CP manager to Center Directors, the JPL Lab Director, MDAAs, program managers, or project managers. Any delegations are documented in the CPMP. Delegation of sourcing decisions may vary from one CP to another, within a CP, and for different types of customers (internal or external).

b. The approach for making sourcing decisions is periodically reevaluated based on various changes, including changes to the sourcing strategy.

2.4 Capability Portfolio Management Oversight

Each CP to which this NPR applies has the MSC as its governing council to provide management oversight. The authorities for managing a CP are defined in Table 2-1.

Table 2-1 Capability Portfolio Governance and Authorities

Role / Responsibility / Function	Title / Council	Comments
Approving authority to initiate Establishment of a CP	MSC
Decision Authority for Strategic Management and Termination decisional reviews	MSC Chair	Additional decisional reviews may be added at the MSC Chair's discretion during Strategic Management.
Governing council	MSC
Governing documents		CPCA and CPMP
Approving authority for the CPCA	MSC Chair	Approval of the CPCA authorizes the transition to Strategic Management. The CPCA is revalidated or updated every five years or less.
Approving authority for the CPMP	Sponsoring MDAA	Timeframe for development of the CPMP is established in the CPCA. The CPMP is revalidated or updated every five years or less.
Decision Authority for significant change decisional reviews	MSC Chair	Significant change is defined by threshold(s), criteria, and constraints established in the CPCA. Approved significant changes may require updates to the CPCA and/or CPMP.
Selecting official for an advisory board	Sponsoring MDAA	MDAA may determine that existing board or council can perform the advisory function.
Manages the CP	CP Manager	May escalate decisions to sponsoring MDAA or the MSC Chair in accordance with thresholds.

2.5 Reviews

Reviews relevant to a CP comprise decisional reviews, CP reviews, and other reviews.

2.5.1 Decisional Reviews

2.5.1.1 Decisional reviews are used to determine a CP's readiness to proceed, approve significant changes to the CP, or terminate the CP. A decisional review occurs at three milestones:

a. Transition from Establishment activities to Strategic Management activities (including approval of the CPCA).

b. A significant change ("significant" is defined in the CPCA) in the composition, management, or funding of the CP.

c. Transition from Strategic Management activities to Termination activities.

2.5.1.2 The MSC Chair may require additional decisional reviews.

2.5.1.3 The CP manager shall support and attend decisional reviews. In coordination with the sponsoring Mission Directorate, the CP manager prepares for a decisional review by determining the materials to be submitted to the MSC Chair to support the decision process. Materials used in support of decisional reviews are archived along with links to applicable Agency Web sites that archive MSC decision packages and MSC decision memorandums for decision reviews. (The archival method is documented in the CPMP.) These materials may include the following:

a. Recommendations, assessments, and/or findings from the governing council (i.e., the MSC), the sponsoring Mission Directorate's Directorate Program Management Council (DPMC), the CP review report(s), the CP manager, stakeholders, and Center Management Councils (CMCs). (See Section 2.5.2 for more information about CP review reports.)

b. Relevant Agency priorities and roadmaps.

c. Cost estimation reports.

d. Relevant lessons learned.

e. Documents requiring the MSC Chair's signature (e.g., CPCA, CPMP).

2.5.1.4 The MSC Chair may also request additional documentation to support the decisional review.

2.5.1.5 The MSC Chair shall serve as the Decision Authority as specified in Table 2-1 and conduct CP decisional reviews at the MSC. The MSC Chair's decision is based on consideration of a number of factors including but not limited to the following:

a. Continued relevance of the CP and its components to the Agency's vision and mission as defined by NPD 1001.0 and current Agency strategic implementation planning.

b. Efficiency, effectiveness, and affordability with respect to the Agency's resources.

c. Agency, Mission Directorate, institutional, program, or project risks mitigated or managed by the CP.

d. Evaluation of capability programmatic demand (aggregated program and project requirements) versus capability capacity (supply) available in-house and external to the Agency able to meet the capability requirements.

e. Preparation and readiness to proceed and viability of proposed changes to the CP.

2.5.1.6 The results of a decisional review are documented in retrievable MSC documentation.

a. If no changes are required following the decisional review, the MSC Chair signs applicable documents, which may include a decision memorandum, and the CPCA and/or CPMP.

b. If changes are required, the documents are revised, all signatures are obtained, and the documents are resubmitted to the MSC Chair for final signature.

2.5.2 Capability Portfolio Reviews

2.5.2.1 CP reviews are essential elements of managing and evaluating the performance of Agency capabilities. The sponsoring MDAA and CP manager are responsible for periodically evaluating the efficiency, effectiveness, and performance of the CP and its capability components. The evaluation focuses on how well the CP is aligned with Agency needs, how well commitments are being met, and how well management processes are being followed.

2.5.2.2 Evaluation of the performance of a CP occurs at different levels among different stakeholders. In developing the review requirements, the sponsoring MDAA and CP manager should consider the need for internal reviews conducted by the CP manager, sponsoring Mission Directorate reviews conducted by the DPMC; advisory board reviews, stakeholder reviews, and/or external reviews independently performed by outside organizations.

2.5.2.3 CP managers identify the reviews appropriate for each CP in coordination with the sponsoring MDAA and the MSC Chair to ensure the continued relevance (alignment with Agency vision and mission), performance, effectiveness, and affordability of the CP.

2.5.2.4 Planned CP reviews are identified in the CPCA and CPMP. The approach to conducting the reviews and the review team structure are documented in the CPMP.

2.5.3 Other Reviews

The MSC Chair evaluates the performance of CPs against defined goals and objectives. Evaluations may be implemented through the MSC CPM Annual Review, reports from the MSC, and Agency-level reviews, such as the Agency Baseline Performance Review (BPR).