Root Causes of Cost Growth in Major Defense Acquisition Programs (Revised)

Abstract

Year (FY) 1965-FY 2009 was unrealistic features in the programs initial baselines. This paper develops a theory of the root causes of this part of cost growth and provides statistical estimates of the model implied by this theory. Just upstream from most unrealistic program features lies competition for funding. Further upstream are circumstances that help explain why senior Department of Defense (DoD) decision makers sometimes approve unrealistically optimistic baselines. These are complex, but notably almost all occurred in periods during which funding made available to DoD was not sufficient to meet all reasonable demands imposed by such factors as force structure and the missions which DoD was expected to be able to perform. Yet further upstream are delays in adjusting the determinants of funding requirements to the funding provided. This causal chain accounts for the largest part (although not all) of cost growth in MDAPs. The statistical evidence for the model based on these factors is excellent.

Open PDF

Document Details

Document Type
Technical Report
Publication Date
Sep 01, 2020
Accession Number
AD1131691

Entities

People

  • David L. Mcnicol

Organizations

  • Institute for Defense Analyses

Tags

Communities of Interest

  • Human Systems
  • Weapons Technologies

DTIC Thesaurus Topics

  • Abstracts
  • Acquisition
  • Computer Programming
  • Contracts
  • Cost Analysis
  • Cost Estimates
  • Cost Reductions
  • Costs
  • Defense Systems
  • Department Of Defense
  • Engineering
  • Force Structure
  • Governments
  • Logistics
  • Military Acquisition
  • National Security
  • Procurement
  • Test And Evaluation
  • United States
  • Weapon Systems

Readers

  • Atmospheric Science / Meteorology, specifically Wind Wave Turbulence.
  • Defense Acquisition Program Management
  • Life Cycle Cost Analysis