The use and application of historical data to support cost forecasting of future MoD programmes

Transcription

1 Defence Equipment and Support The use and application of historical data to support cost forecasting of future MoD programmes Ken Young, SET/SF Dale Shermon, PRICE Systems SCAF Conference 18 November 2008 Creating True Concepts

2 Agenda Partnering (Ken) The Task (Ken) TruePlanning and TrueAnalyst (Dale) The Master Data and Assumptions List (MDAL) (Dale) Overview on the True Concepts methodology (Dale) Summary / Results (Ken) Creating True Concepts 2

3 Partnering Sharing of MoD and Price Expertise We have long term relationships and Investment in Price tools. Access to large data sets Integrated tool set is effective and convenient to use Access to Price programming resources Creating True Concepts 3

4 Partnering approach to initial cost research Data Normalisation CER Creation Validation and Verification TrueAnalyst Implementation PRICE SET/SF Joint SET/SF and PRICE workshop PRICE Creating True Concepts 4

5 The Task Phased prioritised approach to Program Phase 1 Phase 2 Phase 3 Phase 4 5 cost models Model Maintenance Model Maintenance Model Maintenance 5 cost models Model Maintenance Model Maintenance 5 cost models Model Maintenance 5 cost models Creating True Concepts 5

6 The Task Implementation of five validated and verified Cost Objects (cost models) namely; Wheeled - Utility / Protected Patrol Vehicle Non Naval Fixed Wing (Typhoon) Landing Platform Helicopter (LPH) / Landing Platform Dock (LPD) Missiles Unmanned Aerial Vehicle (UAV) Phased introduction of further Cost Objects with sustainment of the existing models. Research on the extension of the model into Operating, Support and Disposal phases. Conversion of the SET/SF Software Rule of Thumb Model from a MS-Excel cost research to a TruePlanning Cost Object. Creating True Concepts 6

7 Agenda Partnering (Ken) The Task (Ken) TruePlanning and TrueAnalyst (Dale) The Master Data and Assumptions List (MDAL) (Dale) Overview on the True Concepts methodology (Dale) Summary / Results (Ken) Creating True Concepts 7

8 TruePlanning Framework TrueAnalyst Cost Research TruePlanning for Concepts TruePlanning for Others TruePlanning for Software TruePlanning for System Catalogues TruePlanning for IT TruePlanning for Hardware Cost Analyst Cost Engineer Estimator Strategic Forecasting TruePlanner Creating True Concepts 8

9 Activity Based Cost Framework Cost Objects Activity Driver Activities Resource Driver Resources What was produced The reason for performing activity Activity Drivers are used to trace the consumption of Activities by your Product/Services. How it was spent The work that is done. Activities consume Resources. Resource Drivers are used to trace the Resources to Activities. Creating True Concepts 9 What was spent Anything that you spend money on in performing an activity

10 TruePlanning Architecture Systems cost model Software PFG Software Rule of Thumb Software RoT Naval aircraft Carriers Tracked IFV SSN / SSBN Helicopter UAV Wheeled Vehicles Non Naval Fixed Wing LPD/H Missiles Information Technology Hardware COCOMO Concepts Creating True Concepts 10

11 MDAL Introduction Cost Modeling Process General Approach Model Owners and Points of Contact Initial Cost research program Data gathering Data sources Normalisation CER creation Validation and Verification TrueAnalyst implementation Model Interoperability Cost model maintenance program Maintenance Configuration Control Assumptions and Exclusions General Assumptions Financial Assumptions Programme Assumptions Exclusions from this study ANNEX Detail Design and algorithms Creating True Concepts 11

12 Research process 1. Boundary of the Problem 7. Test Data 2. Normalize source data 3. Identify Activities and Resource 4. Compile Cost Estimating Relationships 5. Input Activities and Resources 6. Test and accept Cost Object 8. Validate and Verify Cost Object Creating True Concepts 12

13 Summary of approach Inputs - Design - Performance Cost Estimating Relationship (CER) Output - Cost - Schedule - Performance Historical Project Normalised The approach to Parametric Modelling Creating True Concepts 13

14 Prediction versus History Nuclear Submarines Accuracy $3,500,000,000 $3,000,000,000 R 2 = True Concepts T one $2,500,000,000 $2,000,000,000 $1,500,000,000 $1,000,000,000 R 2 = $500,000,000 $0 $0 $500,000, 000 $1,000,00 0,000 $1,500,00 $2,000,00 $2,500,00 $3,000,00 $3,500,00 0,000 0,000 0,000 0,000 0,000 Historical T one Weight + Technology Linear (T1 based on weight) T1 based on weight Linear (Weight + Technology) Creating True Concepts 14

15 True Concepts Phase one study - Catalogue implementation Creating True Concepts 15

16 Top MOD projects Case Study - Top level analysis Creating True Concepts 16

17 Top MOD projects Case Study - Individual program risk analysis Creating True Concepts 17

18 Agenda Partnering (Ken) The Task (Ken) TruePlanning and TrueAnalyst (Dale) The Master Data and Assumptions List (MDAL) (Dale) Overview on the True Concepts methodology (Dale) Summary / Results (Ken) Creating True Concepts 18

19 Summary / Results Simple cost models low number of inputs specific to the system typically 2 or 3, detailed architecture not required, intended for early project stages Quick and Easy to use Common approach to inputs, risk analysis, outputs, escalation, capacity analysis, etc. Compatible with more detailed Parametrics more detail can be obtained by modelling in True H (including HL) and S providing audit trail and cost modelling Through Life Open Architecture Cost Estimating Relationships (CERs) visible and modifiable not a Black box (driven by CSA) Provides a new and independent tool in the box. (our process calls for at least 2 methods) Creating True Concepts 19

20 Defence Equipment and Support The use and application of historical data to support cost forecasting of future MoD programmes Ken Young, SET/SF Dale Shermon, PRICE Systems Creating True Concepts

21 Back-up slides Creating True Concepts 21

22 260 Systems 30 Systems Creating True Concepts 22

23 T 1 Cost US$ 2006 High Low Low High Weight = Historical Normalised Data Creating True Concepts 23

24 Residual US$ 2006 ec Creating True Concepts 24

25 T 1 Cost US$ 2006 Cost of 1970 system Cost of 1950 system Cost of earlier system 4,000 kg Creating True Concepts 25 Weight

26 Engineering = ƒ (T 1, New Design) Prototype = ƒ (T 1, Number Prototypes) Task Related Effort Task Related Effort Time related Management = ƒ (T 1, Development Duration) The relationship with development costs Creating True Concepts 26

27 Creating True Concepts 27