Analysis of the U.S. Navy termination model for procurement contracts
Smith, Terence G.
McMasters, Alan W.
Henderson, David R.
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This thesis analyzes the Navy's procurement contract termination model, the mathematical model on which the Navy's Inventory Control Points will rely to determine whether to terminate procurement actions on items in long supply. The analysis focuses on which costs are relevant to the model and which costs are irrelevant. Suggestions for improvement are offered which include both eliminating irrelevant costs considered by the model and adding relevant costs not considered. Finally, the thesis evaluates the model's recommendations for terminations over a range of values of key model parameters to determine which parameters have the most impact on the model's decisions. Then it recommends further research in determining more precise values for those parameters with the largest effect on the model's decisions.