An Overview of Acquisition Reform Cost Savings Estimates by Mark Lorell

By Mark Lorell

A couple of analyses have lately been carried out in efforts to replace technical expense versions and price estimating relationships for fixed-wing strive against airplane, particulary in gentle of the varied cost-saving measures which were initiated over the last decade. This file makes a speciality of aqguisition reform or the establishment of alterations in govt acquisition procrsses or within the courting among the govt. and division of security primes.

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Some contractors focused on other cost drivers identified in the top ten C&L list and on the problems associated with reforming them. S. government property management regulations was the “biggest failure” of regulatory reform. Many complained about perceived problems associated with reforming the C/SCS. One contractor said that the 28 An Overview of Acquisition Reform Cost Savings Estimates government had made no effort to encourage replacement of the costly and cumbersome C/SCS. This contractor also asserted that replacement of this system with another would be costly and disruptive.

Most of the tables have a column labeled “estimate quality” that distinguishes between three kinds of estimates. The highest-quality estimate, labeled “actuals,” signifies that the estimate of AR savings was based on actual R&D and production cost data from the specific item under consideration, compared to earlier actuals for the program prior to the imposition of AR. 8 The second-highest-quality estimate, labeled “forecast,” refers primarily to a narrow set of cases in which actual production costs for the specific article are well known but the program is being restructured in a way that is expected to reduce costs.

Individual programs and program managers supply estimates, but there was not always uniformity in methodology and analytical approach. ” OVERSIGHT COMPLIANCE COST PREMIUM SUMMARY AND COST SAVINGS OBSERVATIONS Based on the data available, it is impossible to provide a precise estimate of the cost savings that can be expected to accrue from regulatory and oversight reform, much less from the specific elements that go into it. It seems clear that there is some level of cost premium paid by the DoD by virtue of the regulatory and oversight burden im- 30 An Overview of Acquisition Reform Cost Savings Estimates posed on contractors.

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