Cost Growth and the Limits of Competition

Abstract

Cost increases on major weapons system and service contracts have historically been a problem for the Department of Defense (DoD). Cost growth has occurred on all kinds of contracts and on both fixed price and cost reimbursement type contracts. Recent studies have shown that the most influential factors effecting cost growth have been decisions made by the Government, optimistic cost estimating and mistakes. The level of competition or type of contract has little if anything to do with cost growth on most Government contracts. This article analyzes the primary causes of cost growth on DoD contracts and concludes with a discussion of some of the recommendations for controlling cost growth including competition and selecting the appropriate contract type.

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Document Details

Document Type
Technical Report
Publication Date
Sep 01, 2012
Accession Number
ADA580200

Entities

People

  • Allen Friar

Organizations

  • Defense Acquisition University

Tags

Communities of Interest

  • Human Systems
  • Weapons Technologies

DTIC Thesaurus Topics

  • Accountability
  • Acquisition
  • Competition
  • Contractors
  • Contracts
  • Cost Estimates
  • Cost Overruns
  • Cost Reimbursement Contracts
  • Department Of Defense
  • Fixed Price Contracts
  • Governments
  • Military Acquisition
  • Military Operations
  • Procurement
  • Public Administration
  • Training
  • Unmanned Aerial Vehicles

Fields of Study

  • Political science

Readers

  • Educational Psychology
  • Government Contracting/Procurement.
  • Systems Analysis and Design