Improving the Cost Estimation of Space Systems. Past Lessons and Future Recommendations

Abstract : In response to historically high cost growth in the acquisition of space systems, the Under Secretary of the Air Force, in accordance with National Security Space (NSS) Acquisition Policy, directed the Air Force acquisition community to support the development of independent, accurate, and timely cost analyses to make the acquisition of NSS systems more realistic in terms of estimated costs. In turn, the former commander of Air Force Space Command (AFSPC), Gen Lance W. Lord, and the former commander of the Air Force Space and Missile Systems Center (SMC), Lt Gen Michael Hamel, asked RAND Project AIR FORCE to assess cost-estimating requirements and capabilities of SMC cost-estimating organizations as well as their resources, tools, methods and processes and to recommend an enhanced approach to cost analysis aimed at improving cost-estimating for space systems and increasing the understanding of factors that influence their cost. The study was sponsored by the former commander of SMC, General Hamel. The project technical monitor was Col Delane Aguilar, SMC/FMC. The research was conducted within the Resource Management Program of RAND Project AIR FORCE as part of a multiyear study entitled Air Force Space Systems Costs. The initial data collection was completed in May of 2006 and the final update was provided in February of 2007, with frequent updates in between. The final briefing was presented to General Hamel on March 13, 2007, and to Gen Kevin P. Chilton, the former commander of Air Force Space Command, on March 21, 2007. This monograph should interest government personnel involved in cost estimation and acquisition of defense systems, the military space acquisition communities, and those concerned with current and future acquisition policies.