Production Risk Assessing Methodology (PRAM).
Abstract
By analyzing Army SAR systems during the transition from R&D to production, it was determined that a 35% average cost growth was occuring in the Procurement appropriation (excluding inflation and quantity changes) which amounts to over $5 billion. It was also determined that as in R&D, risks are inherent in all systems during early production and often lead to large production cost increases. The various techniques used to address risk and uncertainty, including those used in the Army's TRACE program, were reviewed. Although these same techniques can be used to address initial production risks, the Production Risk Assessing Methodology (PRAM) offers an improvement. It combines an empirically developed risk structure with conventional cost estimating techniques to quantify initial production risks into a dollar estimate which complements the Baseline Cost Estimate. Using the PRAM production risk and cost growth can be reduced. (Note: PRAM, with some modifications, has been incorporated into a DARCOM approved methodology titled Total Risk Assessment Cost Estimating for Production (TRACE/P)). (Author)
Document Details
- Document Type
- Technical Report
- Publication Date
- May 01, 1982
- Accession Number
- ADA115963
Entities
People
- Monte G. Norton
- Paul E. Grover
- Richard D. Abeyta