Cost Estimating is the process of developing a cost estimate. Cost estimating involves collecting and analyzing historical data and applying quantitative models, techniques, tools, and databases to predict a program’s future cost. Parametric cost estimating is a parametric technique that uses regression or other statistical methods to develop Cost Estimating Relationships (CERs). A CER is …
The Office of the Secretary of Defense (OSD) Office of Cost Assessment (CAPE) provides independent analysis and advice to DoD officials on matters of cost estimation and cost analysis for weapons acquisition programs, including matters of program life-cycle cost. The Director of Cost Assessment and Program Evaluation (DCAPE) provides policies and procedures for the conduct …
Note: Manpower estimates are no longer required by DoD Instruction 5000.02 as a milestone deliverable. From DoD Instruction 5000.02: In advance of contracting for operational support services, the Program Manager will, in conjunction with the designated DoD Component manpower authority, determine the most efficient and cost-effective mix of DoD manpower and contract support. The mix of military, DoD civilian, and …
The Engineering Cost Estimating method (Also called Bottoms-Up) builds the overall cost estimate by summing detailed estimates done at lower levels of the Work Breakdown Structure (WBS). It’s a technique where the system being costed is broken down into lower-level components (such as parts or assemblies), each of which is costed separately for direct labor, …
Data Normalization is the act of taking various forms of data and putting them into a standard format for ease of use. Since data can be gathered from a variety of sources, they are often in many different forms and need to be adjusted before being used for comparison analysis or as a basis for …
The DoD Cost Assessment and Program Evaluation (CAPE) is the DoD office responsible for cost estimating. A Cost Estimate (also known as a Life-Cycle Cost Estimate) is a detailed estimate of acquisition and Total Ownership Costs (TOC) for an acquisition program. It’s normally required for high-level decisions. A DoD Component Cost Estimate is provided to …
A cost estimate for a proposed materiel solution(s) is submitted at Milestone A. Also, the Director of Cost Assessment and Program Evaluation (DCAPE) conducts an Independent Cost Estimate (ICE) in advance of Milestone A certification. In order to facilitate these estimates, the cost estimating procedures at Milestone A will track those at the other milestone …
Cost estimating is a valuable tool that is used in each of the acquisition phases. There are a number of cost-estimating techniques that can be used in estimating the costs of a future and current weapon system. The use of a specific approach will depend on how much information is available and where the weapon …
The generic term “DoD Component Cost Estimate” is used to provide considerable latitude to each military service or defense agency as to the actual responsibility for this cost estimate. In some cases, a military service assigns the responsibility to the Program Management Office (PMO), which then provides a Program Office Life-Cycle Cost Estimate (PLCCE). In …
Cost Analysis Reviews are conducted by the OSD Office of Cost Assessment to provide oversight of programs to ensure that they are able to deliver on cost, schedule, and performance parameters. All cost estimates and cost analyses and associated studies conducted by the DoD Components for Major Defense Acquisition Program (MDAP) and Major Automated Information …
