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Systems Engineering and Program Management

Trends and Costs for Aircraft and Guided Weapons Programs

by David E. Stem, Michael Boito, Obaid Younossi

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Systems engineering and program management (SE/PM) constitute a large portion of the acquisition cost of military aircraft and guided weapons systems. The goal of this study was the development of a set of cost-estimating relationships that can be used to estimate the SE/PM cost element for development and production of aircraft and weapons programs. The authors canvassed government and industry personnel to learn about current techniques for estimating SE/PM costs, and they collected historical data from several aircraft and weapons programs to investigate trends in SE/PM costs over time and to generate methods that cost analysts can use early in the life cycle of a program when little cost information is available. The authors also investigated the effects on SE/PM costs from acquisition reform, including the reduction in the number of military specifications and standards, the use of integrated product and process teams, and the trend toward “evolutionary acquisition.”

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    Defining Systems Engineering and Program Management

  • Chapter Three

    Cost Trends in Systems Engineering and Program Management

  • Chapter Four

    Cost Data Findings and Current Estimating Approaches

  • Chapter Five

    Analytic Approach for Estimating SE/PM Costs

  • Chapter Six

    How New Acquisition Practices Will Affect SE/PM Cost Estimates

  • Chapter Seven

    Conclusions

  • Appendix A

    Relationship of Systems Engineering to the Acquisition Life-Cycle Process

  • Appendix B

    MIL-HDBK-881 Excerpt: Definitions of SE/PM for Cost Reporting

  • Appendix C

    Contractor Questionnaire

  • Appendix D

    Variables Used in Developing CERs

  • Appendix E

    Statistical Correlations for SE/PM CER Variables

Research conducted by

The research reported here was sponsored by the United States Air Force and conducted by RAND Project AIR FORCE.

This report is part of the RAND Corporation monograph series. RAND monographs present major research findings that address the challenges facing the public and private sectors. All RAND monographs undergo rigorous peer review to ensure high standards for research quality and objectivity.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.