Major Weapon Systems Acquisition and Life Cycle Cost estimation: a case study
Matthews, David F.
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The Major Weapon Systems Acquisition Process requires the acquiring organizations to make long term resource commitments, whereas the defense budgets of many nations have declined over the past decade. Therefore, it is imperative for program managers and acquisition practitioners to make informed decisions not only considering the up-front costs, which are related to fielding of the system, but considering all the costs expected to be incurred throughout the system's planned life. In this study, the major systems acquisition process, and its underlying concepts, life cycle costing, and cost estimation techniques have been discussed, and the strategies that enable the PMO to optimize the life cycle cost of the system are studied in a case study approach. The ATACMS IA missile system has been chosen as the study case. The life cycle cost of the ATACMS IA missile system has been estimated; sensitivity and uncertainty analyses have been conducted by utilizing the Cost Analysis Strategy Assessment (CASA) estimating model in order to develop strategies which will eventually reduce the life-cycle cost of the system. The performance and cost figures used in the model are assumed by the author, due to sensitivity of the actual data. However, the model and the analysis results provide valuable guidance for the PMO, and the analysis methodology is applicable to any weapon systems acquisition program.
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