A Work Breakdown Structure (WBS) (MIL-STD-881C) is a tool used to define a project in discrete work elements in a Hierarchical format. It displays and defines the product, or products, to be developed and/or produced. It relates the elements of work to be accomplished to each other and to the end product. In other words, the WBS is an organized method to breakdown a product into subproducts at lower levels of detail. It’s used for planning, cost estimating, execution and control.
Figure: WBS Sample from SMC Systems Engineering Handbook
The WBS is a means of organizing system development activities based on system and product decompositions. It is a product-oriented family tree composed of hardware, software, services, data, and facilities, which result from systems engineering efforts during the development and production of the system and its components, and which completely defines the program. The WBS is prepared from both the physical and system architectures, and identifies all necessary products and services needed for the system. This top-down structure provides a continuity of flow down for all tasks. Enough levels must be provided to properly define work packages for cost and schedule control purposes. 
A program WBS is established to provide the framework for program and technical planning, cost estimating, resource allocation, performance measurement, and status reporting. The WBS defines the total system of hardware, software, services, data, and facilities, and relates these elements to each other and to the end product. Program offices develop a program WBS tailoring the guidance provided in MIL-HDBK-881 and MIL-STD-881C. The WBS is also an integral part of the preparation of the Cost Analysis Requirements Description (CARD).
The Program Manager (PM) usually has the responsibility to develop an overall program WBS and to initiate the development of contract WBSs for each contract in accordance with common DoD practice established in Mil-HDBK 881. The program WBS is the WBS that represents the total system and, therefore, describes the system architecture. The contract WBSs are part of the program WBS and relate to deliverables and tasks on a specific contract. The PM with the support of systems engineering develops the first three levels of the program WBS, and to provide contractors with guidance for lower-level WBS development. As with most standards and handbooks, use of MIL-HDBK-881 cannot be specified as a contract requirement. Though WBS development is a systems engineering activity, it impacts costing, scheduling, and budgeting professionals, as well as contracting officers. An integrated team representing these Stakeholders is needed to support WBS development. 
The first three Work Breakdown Structure Levels are organized as:
- Level 1: Overall System
- Level 2: Major Elements (Segment)
- Level 3: Subordinate Components (Prime Items)
Contractor Work Breakdown Statement
The contract WBS is the Government – approved WBS for program reporting purposes and includes all program elements (for example, hardware, software, services, data, or facilities), which are the contractor’s responsibility. It includes the contractor’s discretionary extension to lower levels, in accordance with Government direction and the contract Statement of Work (SOW).
- Space and Missile Systems Center (SMC) located at Los Angeles Air Force Base
- A contractor will call their WBS; Contactor Work Breakdown Structure (CWBS)
AcqLinks and References:
-  SMC Systems Engineering Handbook
- MIL-Hand Book-881: Work Breakdown Structure (WBS)
- MIL-STD-881C “DoD Standard Practice Work Breakdown Structure for Defense Materiel Items” – 3 Oct 11