Effect of prime contractor financial position on major weapon system cost and delivery performance

Abstract

This thesis investigates the relationship of prime contractor cost and delivery performance with prime contractor financial health. The analysis used DOD major acquisition programs. Regression was used to analyze the relationship between outcome measures reflecting cost and schedule growth and summary indexes of financial health, constructed using indexes computed from financial distress models. The summary indexes were used to indicate contractor financial health, and change in financial health, before and during both development and production phases of a program. Major findings indicate that a relationship does exist between financial condition and contractor performance, but the relationship is small.