This document provides guidance for preparing life cycle cost estimates of major weapon systems. It provides a framework for objective comparison of research and development, investment, and operating and support costs of program, design or support alternatives, using consistent methodologies and terminology. A suggested cost breakdown structure (CBS) is presented, a general methodology for life cycle cost-estimating is described, and a description of the FLEX computer program used to facilitate the computations is provided. The guidance presented herein is intended to aid in achieving a consistent framework for estimating life cycle costs of major weapon systems. The material contained in this document should be considered a guide - an update of the Naval Material Command Life Cycle Cost Guide for Major Weapons Systems originally published 1 January 1977 - not a rigid specification for Life Cycle Cost analysis.

The existing phased acquisition process, with key milestone decisions by the Secretary of Defense, is the framework for managing the life cycle costs of major weapon systems developed and produced under contracts and operated and supported by the military departments. This report defines life cycle cost and describes the framework and the several regulations, directives, and instructions that guide and direct the performance of the wide variety of functions that are parts of and influence the costs of the planning, designing, managing, acquiring, operating, and supporting of major DoD weapon systems. These include the policies and procedures for major system acquisition, the DSARC process, CAIG, R/M, quality, standardization, and contracting techniques of the award fee contract, life cycle costing, value engineering programs and incentives, and reliability improvement warranties. The report also fits each of these functions and activities into the framework, showing when each may, or must, be performed. It highlights the role of the program manager and the need for joint DoD/contractor management of the high risk process of developing major programs to meet mission needs.

The Major Weapon Systems Acquisition Process requires the acquiring organizations to make long term resource commitments, whereas the defense budgets of many nations have declined over the past decade. Therefore, it is imperative for program managers and acquisition practitioners to make informed decisions not only considering the up-front costs, which are related to fielding of the system, but considering all the costs expected to be incurred throughout the system's planned life. In this study, the major systems acquisition process, and its underlying concepts, life cycle costing, and cost estimation techniques have been discussed, and the strategies that enable the PMO to optimize the life cycle cost of the system are studied in a case study approach. The ATACMS IA missile system has been chosen as the study case. The life cycle cost of the ATACMS IA missile system has been estimated; sensitivity and uncertainty analyses have been conducted by utilizing the Cost Analysis Strategy Assessment (CASA) estimating model in order to develop strategies which will eventually reduce the life-cycle cost of the system. The performance and cost figures used in the model are assumed by the author, due to sensitivity of the actual data. However, the model and the analysis results provide valuable guidance for the PMO, and the analysis methodology is applicable to any weapon systems acquisition program.

Report examining growth in operating and support (O&S) costs of major DOD weapons systems, and identifying measures to improve DOD ability to manage and reduce O&S costs of weapons systems over their life cycle.

The Major Weapon Systems Acquisition Process requires the acquiring organizations to make long term resource commitments, whereas the defense budgets of many nations have declined over the past decade. Therefore, it is imperative for program managers and acquisition practitioners to make informed decisions not only considering the up-front costs, which are related to fielding of the system, but considering all the costs expected to be incurred throughout the system's planned life. In this study, the major systems acquisition process,and its underlying concepts, life cycle costing, and cost estimation techniques have been discussed, and the strategies that enable the PMO to optimize the life cycle cost of the system are studied in a case study approach. The ATACMS IA missile system has been chosen as the study case. The life cycle cost of the ATACMS IA missile system has been estimated; sensitivity and uncertainty analyses have been conducted by utilizing the Cost Analysis Strategy Assessment (CASA) estimating model in order to develop strategies which will eventually reduce the life-cycle cost of the system. The performance and cost figures used in the model are assumed by the author, due to sensitivity of the actual data. However, the model and the analysis results provide valuable guidance for the PMO, and the analysis methodology is applicable to any weapon systems acquisition program.

According to the Government Accountability Office, sustainment of weapon systems accounts for approximately 70 percent of the total life-cycle costs. When sustainment is not considered early in the development process or as an integral part of the systems engineering design, it can negatively affect the ability of the Air Force to maintain and improve the weapon system once it enters service. At the request of the Assistant Secretary of the Air Force for Acquisition, Technology, and Logistics, Weapons Systems Sustainment Planning Early in the Development Life Cycle identifies at what point or phase of the development of a weapons system sustainment planning should be integrated into the program; examines and provides recommendations regarding how sustainment planning should be evaluated throughout the development process; investigates and describes the current challenges with sustainment planning and determines what changes have occurred throughout the acquisition process that may have eroded sustainment planning; and identifies opportunities for acquisitions offices to gain greater access to sustainment expertise.

Logistics life cycle costs make up the vast majority of the cradle to grave expenses associated with the procurement of a new weapon system. A logistics life cycle cost (LLCC) guide is important because it provides the program manager with, essential cost data during both the pre and post contract award phase of a weapon system acquisition program. This data can be used to determine: (1) to whom a contract should be awarded; and (2) to accurately project, and continuously update, the multi-year post acquisition weapon system support costs which are increasingly coming under close scrutiny because of budget reductions.

Cradle-to-grave analyses are becoming the norm, as an increasing amount of corporations and government agencies are basing their procurement decisions not only on initial costs but also on life cycle costs. And while life cycle costing has been covered in journals and conference proceedings, few, if any, books have gathered this information into an