Acquisition Cost Reduction through Improved Production/Inventory Systems.

Abstract

Unliquidated progress payments, or work in process (WIP), cost the Department of Defense several billion dollars per year to finance. These payments represent the value of property paid for by the Government but not yet received. This study developed a formula to determine the present and future value of the holding cost of WIP and to estimate the potential savings of reducing the average WIP. The study indicates that by using a ratio of annual liquidated to average unliquidated progress payments, Government representatives can monitor how effective contractors are in managing Government-owned WIP represented by average unliquidated progress payments. The study proposes a simple addition to the CMSEP which will focus a contractor's attention directly on WIP levels

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Document Details

Document Type
Technical Report
Publication Date
Aug 30, 1985
Accession Number
ADA166660

Entities

People

  • Charles R. White
  • Dennis B. Webster
  • Joseph E. Boyett

Organizations

  • Universal Energy Systems

Tags

Communities of Interest

  • Energy and Power Technologies
  • Human Systems
  • Space
  • Weapons Technologies

DTIC Thesaurus Topics

  • Air Force
  • Contract Administration
  • Contractors
  • Contracts
  • Control Systems
  • Cost Reductions
  • Defense Industry
  • Electronics
  • Electronics Industry
  • Governments
  • Inventory Control
  • Logistics Support
  • Manufacturing
  • Materials
  • Procurement
  • Scheduling (Production)
  • Standards

Readers

  • Government Contracting/Procurement.
  • Nuclear Civil Defense.