Should Cost Estimating Procedures and Implementation Study, Phase II Interim Program Review Prepared for: Mr. Rob Pollock (SAF/AECO) November 28, 2012

Should Cost Estimating Procedures and Implementation Study, Phase II Interim Program Review

Prepared for:

Mr. Rob Pollock (SAF/AECO)

November 28, 2012

NATIONAL DEFENSE BUSINESS INSTITUTE PROPRIETARY INFORMATION

Copyright © 2012 by University of Tennessee National Defense BusinessThis document has been prepared by NDBI under contract #FA7014-10-D-0012, Task Order 0002 for the United States Air Force.

It is based on, and may contain, U.S. Government information; release or disclosure of this document or information contained herein will be determined by the United States Air Force.

Should Cost Phase II Interim Program Review Contents

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• Bottom Line Up Front

• Study Scope

• Terms

• Should Cost Process Explained

• Resourcing and Governance

• Recommendations

• Study Delivery Plan

• Appendix

Use of disclosure of data contained on this page is subject to the restriction on the title page of this document.

Should Cost Phase II Interim Program Review Bottom Line Up Front


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• Phase 1 - Complete May 12– Should cost analysis as negotiation tool > 40 years in defense acquisition – Variety of methods and means used for Should Cost estimate, deprive PMs of better buying

power (BBP) benefits – Standardized process provides means of capturing BBP opportunities

• Phase 2 - This study– Demonstrates PMs can achieve should cost benefits through disciplined focus on direct and

indirect costs; potential efficiencies, government costs and strategic actions that enable BBP– Standardizing PM approach and process with organic resources simplifies achieving affordability

and cost savings – Placing Should Cost “ownership” within a Program Control Function will minimize induced

variance and provide long-term monitoring accuracy– Continuous Should Cost Estimating allows for clear view of program progress variation

• NDBI outlined a should cost process and developed a practical guide for PMs– Findings and recommendations were informed by previous case research

• Formidable obstacles to uniform, successful implementation of Should Cost estimating remain. – Method, steps and resourcing described here aid Air Force acquisition community in attaining

BBP goals and improving return on investment

Should Cost Phase II IPR is a snapshot of the study project as of the time briefed and is not a final product. The effort to date will benefit from and be informed by the views of the reviewers.

Should Cost Phase II Interim Program Review Study Scope


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Develop a comprehensive Should Cost process for all levels of ACAT programs clearly outlining and explaining intent, process, and detailed steps to take as well as recommending personnel skill requirements crucial to achieve desired results.

(F-22 3.2b software Should Cost effort used as an exemplar)

• Focus on exploiting results from phase one

• Develop process for implementing the In-Progress Should Cost Estimating Process within PM’s capability

• Use traditional Air Force Should Cost estimating methodology to provide an organizational and streamlined procedure baseline

• Tailor procedures to the level of program complexity unique to the Acquisition Categories.

• Build plan to implement findings and conclusions in both the In-Progress Should Cost as well as the traditional Should Cost estimates tailored to ACATs

Should Cost Phase II Interim Program Review Basic Terms

Will and Should Cost Terminology•A transparent two-tiered cost, funding and management approach using two separate estimates

•Will Cost Budget Baseline is a non-advocate budget – similar to Independent Cost Estimate

- Parametrically derived - Provides sufficient resources to execute the program

under normal conditions- Average levels of technical, schedule and

program risk ( greater than 55-60% confidence)- Sufficient funding to allow program completion without additional budgets - Baseline for potential Nunn-McCurdy breaches

•Should Cost Baseline estimates developed by the Program Office- Used as an internal management tool to incentivize performance to targets- Based on realistic technical and schedule success oriented outcomes by implementing

efficiencies, lessons learned and best practices- Early should cost estimates drive affordability goals, later estimates identify cost savings- Designed to drive productivity improvements- Incorporates results of FAR/DFAR Should Cost review of direct and indirect costs


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Review findings and recommendations are informed by previous National Defense Business Institute studies, such as...

Program Control (PC)• Strengthening the PC function would support Program

Managers (PMs) with integrating various analyses and provide them the needed capability to make informed program decisions and tradeoffs, allowing PMs to anticipate problems and take appropriate steps early to find solutions

Acquisition Strategy for Contract Success• Provides government decision makers with a

repeatable documented formal process for developing business relationships based on current requirements at any acquisition phase

MDAP Lessons Learned• Ensure decision makers have necessary

information and an adequate understanding of implications to make quality decisions; implement proven program control functions; effectively track program performance, and secure appropriate stakeholder expertise

Analysis of Indirect Costs• Examines the effect of indirect rates on program costs

and challenge these rate “pools” pose to affordable delivery and government buying power

And, more.......

Should Cost Phase II Interim Program Review Should Cost Estimating Process Built On Prior Studies


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Program

Leadership

Sector

Corporate and Overheads

Multiple Contractors Air Force Wide Portfolio

DoD Wide Portfolio

Industry

Macro

Micro

Span of Influence(Direct and Indirect costs)

PM

PEO

AFMC/ Center

SAF/AQ/FM/Other

SECAFDoD/AT&L

Congress

Government

Macro

Micro

Should Cost Phase II Interim Program Review Span Of Influence For Program Success

Span of influence for both government and contractors establishes context for program success


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Should Cost Phase II Interim Program Review Continuous Should Cost Estimating (SCE) Process

Not Dependent on Milestone Events; Applies Continuously Throughout Program

Program office expertise and skill sets drive a successful Should Cost Event

Should Cost Enterprise

Capability Survey

Should Cost Enterprise

Capability SurveyStratifyStratify

Start with Will Cost baseline

•Programs use functional, domain and process expertise to identify areas where value can be achieved at lower operating costs while successfully mitigating risks

•Early, on-going collaboration between requirements and program offices results in more credible Program of Record Will Cost Baseline

PM’s develop target areas of interest

•Initial alignment across all stakeholders on program mission and requirements that can be reduced

•PM’s validate requirements, and funding based on accurate cost estimates

•SAF/AQ/FM input improves ability to resolve potential issues

PMs stratify options consistent with program scope, balanced requirements, funding and schedule

•Options are considered that modulate one or more of the above ensuring program successfully executes at Should Cost estimate

•Independent reviews provide program office with added perspective

PM’s develop Should Cost skilled positions and put infrastructure in place to execute; nominally the program team responsible for delivering the Program of Record

•Benchmarking between program office and contractor can foster open communication and alignment on set of prioritized issues

PMs ensure Acquisition Strategy Plans and Request For Proposals enable Should Cost savings and implement through their program staffs, with specialized assistance secured where needed.

•Should Costs are negotiated and contracts definitized per the requirements statement of the program of record

Develop Micro and Macro

Opportunities

Develop Micro and Macro

Opportunities

Develop Courses of Action

Develop Courses of Action

Should Cost Implementation and Ongoing Monitoring

Should Cost Implementation and Ongoing Monitoring


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Should Cost Phase II Interim Program Review Continuous SCE Process


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Should Cost Estimate seeks to drive productivity improvements into programs during contract negotiations and throughout program execution including sustainment; providing value at lower cost.

Continuous Should Cost analyses enables PM to scrutinize all elements of government and contractor costs and apply corrective measures to drive economic efficiencies

The ProcessThe Process

Should Cost Phase II Interim Program Review Continuous Top Level SCE Process

Basic Considerations:

•Should Cost events are conducted on continuous basis as information becomes available as well as in support of key decisions

•Stakeholder priorities and requirements have major impact on Should Cost

•The availability of data / knowledge and the skill set of the estimating team determines the actual estimating method used

•The program characteristics such as size and complexity of the program, determines the estimate class defining level of effort and consequently, the resources required to effectively conduct a Should Cost analysis

•Each Should Cost event can be treated as a project with a beginning and end

•Mirror the program acquisition and contract definitizing efforts


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Select Estimating Method

Tailor Estimating Method

Determine Availabilityof Resources

Determine SC Objectives

Document Method Assumptions and

Ground Rules

Determine Estimate Class

Acceptable Risk

Availability &Validity of Data

Purpose for SCE

Stakeholders Input

Program Characteristics

Prioritized Elements for Focus

Should Cost Phase II Interim Program Review Top Level SCE Process Expanded


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Statute, Regulatory or Policy Initiates

Statute, Regulatory or Policy Initiates

Identify Program CharacteristicsIdentify Program Characteristics

Identify Purpose for SCEIdentify Purpose for SCE

Identify and Prioritize Elementsfor Focus

Identify and Prioritize Elementsfor Focus

Determine SCE Ground Rulesand Assumptions

Determine SCE Ground Rulesand Assumptions

Determine SCE StructureDetermine SCE Structure

Identify Team and FundingIdentify Team and Funding

Identify SCE Monitoring and Management

Identify SCE Monitoring and Management

Identify Closeout Actions & PlanIdentify Closeout Actions & Plan

Identify Report Generation PlanIdentify Report Generation Plan

SCE Eventor Time Driven?

SCE Eventor Time Driven?

PBE or AnnualPBE or Annual

Acquisition EventAcquisition Event

H/WH/W S/WS/W ServicesServices

Program ControlProgram Control

MetricsMetrics ToolsTools StructureStructure

Determine Availability and Validity of Data

Determine Availability and Validity of Data

Acceptable RiskAcceptable Risk

Existing Program Reports

Existing Program Reports

Existing Databases

StakeholdersStakeholders

Acquisition EventAcquisition Event

Personnel Skillsetsand Qualifications

Tasks

Existing Information

Participants

Key Questions

A “multi-discipline roadmap” leverages organizations with specific, chartered responsibility to help determine best values, efficiencies and opportunities to fully inform and underpin the Should Cost Review (SCR)

Should Cost Phase II Interim Program Review SCE Process Methodology And Participants


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Should Cost Phase II Interim Program Review SCE Process Program Success Objectives Considerations

• Recurring cycle with Will Cost establishing the program contractual baseline; Should Cost better buying power affordability targets

• Program undertakes defined initiatives to deliver value, affordability at lower Total Obligated Amounts (TOA)

• Initiatives comprised of direct, and indirect expense– Direct = most controllable, such as direct labor

– Indirect = less controllable, but sizable long-term savings can accrue to both the Air Force, and contractor, such as certain overhead expenses

• Portfolio management and strategic sourcing can exponentially increase value at lower TOA, with corresponding contractor efficiency gains improving global competitiveness

• The program draws upon multifunctional resources to continuously challenge cost growth and drive affordability

– Air Force driven program expenditures must receive equal scrutiny

Challenge: Should cost estimating must address not only steady state, but what it takes to achieve a lowest “could cost.”


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Should Cost Phase II Interim Program Review SCE Process Key Programmatic PM Inquiries

Types of specific questions PMs must ask that drive cost:• Are the program requirements still valid?

• Is engineering trade space available?

• What technical aspects of the program appear to be driving costs?

• Do alternative technologies or processes exist?

• What are the potential savings?

• Is the program structured and resourced properly?

• What changes to organization, processes, schedule are needed?

• Is there a budget profile that would make the program more efficient?

• What government activities, processes, or bureaucracy drive costs?

• Are these actions necessary for program success or risk mitigation?

• Can they be waived, modified, or eliminated?

• Can modifications to the contract be made to help the contractor improve efficiencies?

• What data or deliverables are we requesting from the contractor? What individual or organization uses these? Are they useful and necessary?

Technical Technical Considerations; Considerations;

Meeting Meeting WarfighterWarfighter

NeedsNeeds

Technical Technical Considerations; Considerations;

Meeting Meeting WarfighterWarfighter

NeedsNeeds

Program Program

ResourcingResourcing

Program Program

ResourcingResourcing

Government Government

InitiativesInitiatives

Government Government

InitiativesInitiatives


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Step 3: Adopt appropriate efficiency initiatives

Should Cost Phase II Interim Program Review Specific Steps To Achieve Contract Negotiation Advantage

Step 1: Use existing data Step 2: Develop predictive model

Step 4: Validate

analysis

Step 5: Parametrically Derived cost objectives

Step 6: NegotiateStep 7: Implementation

and metrics


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• Use and rely on existing data sources to develop composite assessment of program costs– Program Contract Data Requirements List (CDRL) data to date– Senior leader presentations– Contractor presentations– Redacted (price) data from other programs

• Leverage on-going efforts– Independent Assessment where possible for broader perspective

• major areas of potential cost savings• Deep-dive review of a couple initiatives

– Form a Government team; create dialog with the contractor• major areas of potential cost savings• DCMA/DCAA/Others to identify indirect rates and incentive range

Should Cost Phase II Interim Program Review Step One: Using Existing Data


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Use single Integrated should cost team to blend critical and existing skills; saves time , provides focus and greater access to information

Leverage existing

resources to satisfy multiple

objectives

Should Cost Phase II Interim Program Review Use And Integrate Existing Review Team Resources


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• Develop predictive modeling method that accurately recreates present program costs – Factor analysis

– Rate analysis (DCAA, DCMA)

– Other government resource historical data

• Using parametric estimating; make efficiency and other adjustments in should-cost objective targets– Comparison to program actuals

– Comparison to other government resource historical data

• Contractor interface (desired) to validate; run, and re-run the predictive model factoring in the should-cost objectives– Contractor involvement important, but if not; not a “showstopper”

• Develop parametric, objective based should cost – Combine results from all analyses

Should Cost Phase II Interim Program Review Step Two: Develop Predictive Model

• Estimates are essentially a cost model of a process, system or object

• Uncertainty and Sensitivity Analysis offer valid tools for characterizing the uncertainty associated with an estimate


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- Uncertainty analysis quantifies the uncertainty in the outcome of an estimate

- Sensitivity analysis has the complementary role of ordering by importance the strength and relevance of the inputs in determining the variation in the output

Existing parametric models exist – should be using same model that the program finance support office uses to ensure continuity of effort

Should Cost Phase II Interim Program Review Step Two: Develop Predictive Model (Cont.)


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• System Engineering Program Management LOE

• Airframe, Payload, Bus Assembly, Software development, Integration & Test, functional labor support & schedule, and much more....

• Major subcontracts (establish dollar value)

• Long lead

• Production

• Resource loading

• Contract terms and conditions– CDRLS

– Compliance efficiencies

• Lean Manufacturing

• Optimized and integrated production schedules (Lean Manufacturing)

• Reduction in government expense (people, dollars and processes)

Should Cost Phase II Interim Program Review Step Three: Adopt Appropriate Efficiency InitiativesIdentify program management efficiencies; candidate elements for

cost reduction

Should Cost uses the common cost drivers and historical information to inform the effort in order to concentrate on the most likely areas to maximize ROI


Direct

Program Management

Technology development/substitution

Testing

Production

Plant Equipment

Deployment

Disposal

Labor

Utilities

Externalities

Exchange Rates

Indirect

Program Oversight

Admin

Engineering support

FCCM

B&P

IR&D

Facilities

Profit or fee

Pensions and Benefits21

Cost Driver Indirect Direct

Program Complexity X X

Contract Type X X

Tech Maturity X X

Manufacturing Maturity X

Funding Stability X X

Resource Availability X X

Test Methodology X

Delivery Location X

Production/Deployment Rate X

Required External Confidence X X

RAM X

CONOPS & OPTEMPO X

Hazardous Materials X

Recoverable Resources X

Production Interruptions X

Requirements Maturity/Stability X X

Number of Reviews & Audits X X

Performance Risk X X

Contract Type Risk X X

Cost Efficiency X

Capital Cost/ Facilities Capital X

Security Level X X

Competition X

Table 3: Common Cost Drivers

Costs sorted into direct or indirect categories then further decomposed into sub-categories

Categories and sub-categories are compared against the MILSTD WBS templates to ensure all types of cost were adequately identified.

An Ishikawa analysis used to identify common cost drivers for each category

Common cost drivers for all categories identified

Should Cost Phase II Interim Program Review Step Three: Adopt Appropriate Efficiency Initiatives (Cont.)


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LargePayoff

SmallPayoff

Easy to Implement Hard to Implement

Possible

Nearly Impossible(Really Tough)

Challenge

Kill

Time

Content (Scope OrPractice)

Program’s feasibility assessment....one of dozens of methods



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Template can be automated and be used to identify most likely estimating method or populating common cost drivers from past programs under each cost category

Program Manager Identified Cost Drivers

Hardware, Software or

Service Cost Drivers

Hardware, Software or

Service Cost Drivers

Cost Drivers/Cost Issues Identify – Current Projected

Cost, Corrective Action, Implementation Timeframe

and potential savings

Cost Drivers/Cost Issues Identify – Current Projected

Cost, Corrective Action, Implementation Timeframe

and potential savings

Type of Estimate will be Based on Fidelity Required

Type of Estimate will be Based on Fidelity Required


• Intersect of Macro and Micro Opportunities....what the program can reasonably pursue


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Selected by the program to pursue

SCELCMC



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• Where data gaps exists, use comparable analysis with other government programs of similar scope and complexity

• Methods to bridge gap analysis:– Challenge basis for indirect costs– Benchmark similar programs; the government to leverage its

purchasing power– Supply chain management challenges– Target pass-through and burdens on non-touch costs– Cost modeling

• Obtain appropriate available data from other government acquisition programs (benchmarking)– Efficiency comparison– Resource pooling– Procurement bundling and strategic sourcing

• Connect and tie to Production Readiness Review (PRR), or similar decision-event

Should Cost Phase II Interim Program Review Step Four: Validate Analysis


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Specific objectives expressed and linked final price

Specific objectives are identified and traceable to new, total cost

Should Cost Phase II Interim Program Review Step Five: Parametric Cost Analysis

Parametric cost analysis valuable for establishing affordability objectives. As actual costs become available subsequent cost savings will depend more on actual program costs.


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Source: Implementing Will-Cost & Should-Cost Management, 16 Feb 2011, R. Davies, Dir PM&AE, and R. Woods, Technical Dir AFCAA

Should Cost Phase II Interim Program Review Step Six: Negotiations Based On Should Cost Estimates

Opportunities and negotiations objectives expressed in terms of:

•Near-term (within the current PM’s tenure) and long-term initiatives

•Program driven (within the PM’s authority)

•Service Driven (within Service SAE and secretary control)

•Externally driven (outside the PM or Service control)


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• Negotiated changes to the contract value are reported in recurring status reports

• Anticipated changes are closely monitored by appropriate means, such as future overhead reductions

• Emphasis is on execution and system delivery

• Maintain close relationship with functional organizations, including externals, such as audit

• Independent assessments, benchmarking and metrics can provide valuable insight

Should Cost Phase II Interim Program Review Step Seven: Implementation Of Negotiated Baseline


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• Team number and composition impacts level of inquiry

• Opportunity areas scaled to available resources/time

Immediate SCR Rationale

Small Team (4 direct

mbrs)

Medium Team (8

direct mbrs)

Medium Team

(12 direct mbrs)

Team composition includes individuals with requisite program management, engineering, acquisition and contracting specialties. These members rely upon and integrate more detailed products generated by those with Federal Acquisition Regulation (FAR) charter responsibilities.

Major Subcontracts

Teaming ● ● ●Consisting primarily with Northrop Grumman

(NG)Interdivisional Work Transfers

(IWT's) ● ●Work accomplished by Lockheed Martin

affi liates

Long lead

Obsolescence ● ● ●

Emphasis on elements no longer required under a production approach (both technical and programmatic)

workload resourcing ● ● See roll on/off planning, belowProduction

Non-Recurring Engineering (NRE) ●Expectation NRE is precluded in production mode

Program Mgt level of effort ● ●Emphasis on elements no longer required under a production approach (programmatic)

Payload assembly, integration and test ●

Emphasis on elements no longer required under a production approach (technical and programmatic)

Resource LoadingEngineering and other Level of effort ● ● ● Emphasis on factors and loading

Allocation/sharing ● ● ● Emphasis on proportionsRoll-on/Roll-off planning ● ● ● Emphasis on timing

Government oversightContract type, terms and

conditions ● Special focus on Section H clausesFinancing ● Review of alternate methods

Rates (overhead and other) ●Limited to desk top validation and present rates published on LM's disclosure statement

Team Composition

Should Cost Phase II Interim Program Review Resourcing Competent Program Management Staff


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Members # Organization Responsibilities

Team lead 1 Program office Leadership

Technical 3 Program Engineering staffing (LOE), deliverables (CDRLS), reports and analyses, program reviews, technical interchange meetings and test reductions, Earned Value Management (EVM), quality assurance and production

Business and contracts

2 Program and Center PK

Rates and factors, contract requirements and subcontract flow downs, EVM (shared with Technical), and all materials (both strategic sourcing as well as component delivery)

Cost 2 Program Prime and subcontract pricing

DCMA and DCAA 1 DCMA/DCAA @ .5 each

Corporate overhead, rates and factors, escalations and all issues affecting the corporate disclosure statement

Administrative and logistics

1 Program Scheduling all reviews, materials preparation, coordination and access requirements

Should Cost Phase II Interim Program Review Resourcing Program Experience And Crucial Skills


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Governance needed to manage multiple expectations, provide status to leadership, minimize speculation and error, and efficiently lead should cost effort

•Frequent communication with entire team

•Focus on cost drivers (Use Pareto 80/20 rule)

•Reliance on – Advisors

– DCMA (DACO and Plant Reps) and DCAA

– Business process teams (Contracts, Business Systems including EVM)

•Involving the industry partners, if at all possible

•Manage prime contractor expectations to avoid mis-communication and speculation

Should Cost Phase II Interim Program Review Governance

Aggressive governance has potential to apply leadership to reduce wasted effort by eliminating redundant reviews and reports – can drive efficient level of effort.

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Recommend implementation of SCE be established within a program control function where competency to provide continuous, accurate and useful SCEs should be resident

and within the PM’s management purview

Estimating

• Creates and validates cost and schedule estimates

• Maintains a current cost estimate and documents reasons for changes to estimates as they occur

• Runs sensitivity analyses and predicts results given program changes

Budgeting

• Prepares budget submission; submits forecasts for obligating funds

• Tracks allotted funds maintains Program Office’s financial records

• Proposes financial strategy; develops financial plans

• Helps with Scheduling

Scheduling

• Determines schedules to fit program needs and constraints

• Tracks progress against schedules, reports deviations from plan, and evaluates the impact of possible solutions

• Interacts with budgeting function

Planning

Integrates, reviews, and maintains all budget plans and schedules

Assists the program manager in initial program formulation and staffing

Configuration Management

Identifies and documents the functional and physical characteristics of a configuration item

Requires rigorous systems engineering

Controls changes to those characteristics

Records and reports changes to processing and implementation statusAnalyzing &

Reporting ForecastingRequirements

ControlRecording/Archiving

Data Management

Compares program status to plans, budgets, estimates, and schedules

Evaluates progress and determines the reasons for variations

Prepares acquisition reports (e.g. MAR, DAES, SAR, etc.)

Determines probabilities associated with the occurrence of predicted events

Identifies potential problems and their impact

Evaluates and recommends alternative courses of action to program managers

Tracks status of program requirements, evaluates impact of requirements changes and updates budget plans and schedules accordingly

Prevents/mitigates ‘requirement creep’

Documents significant actions and decisions affecting the anticipated outcome of the program

Governs and controls the selection, preparation, acquisition, and use of data from contractors


Should Cost Phase II Interim Program Review SCE Managed In Program Control Function

Findings from complementary studies indicate program control is a key element that can drive the entire Should Cost cycle for the Program Manager

WithoutWithout

Program Control InfluenceProgram Control Influence

WithWith

Program Control in ChargeProgram Control in Charge

Task of integrating various analyses often falls solely to the program manager

Execution of program control function varies greatly from program to program

High quality analyses are not consistently conducted

Data is often merely “reported”, rather than used as a management tool

Number of acquisition personnel with sufficient skill and experience in program control is diminishing


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Should Cost Phase II Interim Program Review Should Cost Estimating Managed In Program Control Function


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• Should Cost is relevant for all Air Force programs, irrespective of ACAT, and can improve return on investment and achieve affordability goals

• Early and frequent engagement and integration of financial management and contracting support critical to success

• A disciplined process and specific, sequential steps will aid in developing rigorous, sound estimates

• Achieving Should Cost values mirrors and relies on the acquisition system; basic contracting procedures apply

• Long-term monitoring is needed to ensure the program remains on the “glide slope” to achieving intended efficiencies and cost targets

• Efficiencies will be measured by affordability goals met and cost savings achieved

• Recommend program control function be established in every ACAT program and recurring should cost and ancillary acquisition training to develop and improve workforce skillsets

Should Cost Phase II Interim Program Review

SummaryPursuit of lower cost, higher value acquisition solutions are here to stay....

A continuous should cost estimating process is a critical program management tool that keeps program managers informed better buying power achieved


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Today

Should Cost Phase II Interim Program Review Study Delivery Plan


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Questions

Should Cost Phase II Interim Program Review

Backup


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• SCP – AFCAIG: Service Cost Position – Air Force Cost Analysis Independent Group• NACA: None Advocate Cost Analysis• ICE (CAPE): Independent Cost Estimate (Cost assessment Program Evaluation)• MS Updates WC: Milestone Updates Will Cost• Annual WC Updates: Annual Will Cost Updates• CARD: Cost Analysis Requirements Description• Should Cost (POE): Should Cost Program Office Estimate• Contract T & C’s: Contract Terms and Conditions• CDRL: Contract Data Requirement List• PPBE: Program Planning Budget Execution• POM: Program Objective Memorandum• AoA: Analysis of Alternatives• FFRDC: Federally Funded Research & Development Centers• DCMA: Defense Contract Management Agency• DCAA: Defense Contract Audit Agency• CE: Cost Estimate• KTR: Contractor


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Should Cost Phase II Interim Program Review Appendix - Acronyms


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Should Cost Phase II Interim Program Review Appendix – ACAT Templates


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Should Cost Phase II Interim Program Review Appendix – ACAT Templates (Cont.)


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Should Cost Phase II Interim Program Review Appendix – ACAT Templates (Cont.)


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Air Force Will Cost/Should Cost—ACAT I, II, III Programs

IBR IBR IBR IBR OTRRTRA TRAProgram Reviews(with a technical basis)

Technical Reviews ITR ASR SRR SFR PDR CDR TRR SVR/FCA/PRR PCA ISR

Technology Development

Engineering and Manufacturing Development

Production and Deployment

Operations and Support

Post- PDR A Post- CDR A FRP –Decision Review

User Needs

Technology Opportunities & Resources

Materiel Solution Analysis

iSCEs

Major SCE

Annual iSCEs as Required

Technology Readiness AssessmentInitial SCE

Decision Point

Material Development

A B CMilestone Reviews

Minor SCE Program Reviews

Should Cost Phase II Interim Program Review Appendix – Program SCE Implementation Landscape