Budgetary and programmatic fluctuations during the system development and demonstration phase: a case study of the Marine Corps H-1 Upgrade Program

Abstract

Congress and Department of Defense continue their yearly quest to fund the National Defense Acquisition Strategy with a defense budget that finds itself spread across more military acquisition programs and competing with the redirection of funds supporting supplemental requirements including increased national security and the military presence in Iraq and Afghanistan. Compounding these external funding issues are a multitude of defense acquisition programs that continue to experience internal program cost overruns. Most major defense acquisition programs take well over ten years to reach full-rate production. These programs exceed long-term projected costs because initial developmental and procurement costs are estimated for only short-term accuracy. This case study investigates the fluctuations in the reported budgetary projections and selected acquisition reported costs during the System Development and Demonstration Phase of the Marine Corps H-1 Upgrade Program, while cross-referencing potential programmatic causes for cost overruns. The purpose of this case study is to research a major defense acquisition program, which has experienced a program acquisition unit cost breach, and explore the distribution of the cost increases of the internal and external developmental variables associated with reporting long-term cost of defense acquisition procurements.