Improving Acquisitions In Science And Technology Programs: Creating Unique Cost Factors To Improve Resource Allocation Decisions

Abstract

Cost factors are a common technique employed in Major Defense Acquisition Program (MDAP) cost estimating. The extant suite of available factors, however, primarily consists of development factors from the Engineering and Manufacturing Development (EMD) phase of the life cycle. This study expands the set of factors available to analysts by producing cost factors germane to programs early in the life cycle (i.e. Science and Technology (S&T) programs) and also creates factors for the Production phase of the life cycle. Cost factor development in S&T programs provides unique challenges due to non-standard reporting requirements. To meet these challenges, this study first mapped S&T cost data to create a new, suggested Work Breakdown Structure (WBS) that mirrors the WBS structure utilized in MDAPs via Mil-Std-881. From this, it was determined that two cost factors commonly utilized in MDAP estimates, Systems Engineering/Program Management (SE/PM) and Systems Test and Evaluation (ST&E) could be derived for the S&T programs. The creation of factors for the production phase of the life cycle resulted in 1033 new cost factors from a multitude of diverse programs. Factors were developed by commodity type (aircraft, missile, UAV, space, and ship), contract type (various), contractor type (prime and sub), and Service (Air Force, Army, and Navy). Combining the results of the previous EMD factors developed (Markman et al., 2019) with the two new phases developed here (S&T; Production) results in a robust cost factor toolkit across the acquisition life cycle spectrum.