LIFE CYCLE COSTING IN INDUSTRY

Abstract

The widespread use of Life Cycle Costing in non-defense industry and the enthusiasm exhibited toward it by company officials give strong support to the value and the validity of the Life Cycle Cost concept. Industry's ability to overcome problems associated with Life Cycle Costing provides assurance to the DoD as to the usefulness of the concept. The environment for LCC in industry varies so substantially from that in the DoD that most practices used in industry are not applicable to the Government environment. Industry has placed much more emphasis on the methods of analyzing cost estimates than has the DoD. While industry has developed discounted return on investment methods, DoD test procurements have merely added up the costs and awarded on the basis of lowest total cost. The Government could learn from industry experience in this particular area even though the objectives of profit maximization and cost minimization are different.

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Document Details

Document Type
Technical Report
Publication Date
Sep 01, 1967
Accession Number
AD0660659

Entities

Organizations

  • LMI

Tags

Communities of Interest

  • Ground and Sea Platforms
  • Human Systems

DTIC Thesaurus Topics

  • Aircraft Equipment
  • Business Administration
  • Commerce
  • Contracts
  • Cost Analysis
  • Cost Estimates
  • Costs
  • Defense Industry
  • Department Of Defense
  • Economic Analysis
  • Guarantees
  • Life Cycle Costs
  • Life Cycles
  • Logistics
  • Logistics Management
  • Maintenance
  • Procurement

Readers

  • Educational Psychology
  • Industrial Economics
  • Life Cycle Cost Analysis