# Presentation: 666756

## Software Estimation - A Research Grant funded by the Australian Research Council

- Presented by
**Mr John Brown**
- Assistant Director
- Phone: + 61 (2) 6265 3942
- Mobile: + 61 (412) 715 251
- E-mail: john.brown15@defence.gov.au
- Directorate of Supportability (DS)
- Standardisation Branch (SB)
- Defence Materiel Organisation (DMO)
- Canberra, ACT, Australia

- Software Estimation - A Research Grant funded by the Australian Research Council

**Presentation to the ‘NASA Cost Analysis’ Symposium, New Orleans, Louisiana, USA – 12Apr05 to 14Apr05.**

## Project Title

- Optimising value for money in software development through standardised cost metrics in the procurement, development and project management phases.* *

## Project Summary (1)

- Mission critical and complex software projects habitually exceed budget expectations significantly.

- Regular outsourcing of software development means that procurement specialists, project managers and software engineers require a common understanding of individual system requirement costs to facilitate accord on price.

## Project Summary (2)

- Contemporary techniques for describing and costing requirements fail to directly map into project management structures, leading to ongoing value comparisons that are subjective and unrepeatable.

- The research will develop the principles to be used by both clients and suppliers to compute earned value from requirements, leading to more accurate assessments and calculations of Value for Money in software projects.

## Australian Research Council (ARC)

- A Federal Government body that reports to the Minister of the Commonwealth Department of Education, Science & Training.
- “Plays a key role in the Australian Government’s investment in the future prosperity and well-being of the Australian community.”
- “Mission is to advance Australia’s capacity to undertake quality research that brings economic, social and cultural benefit to the Australian community.”

**Notes:**
Our ‘Software Estimation’ project was funded late in 2004 through an ARC Linkage Grant of $200,000 to be funded over four years.

## Participants

- Curtin University of Technology.
- Defence Materiel Organisation (DMO).
- ADI Limited (Defence Supplier).
- Total Metrics Pty Ltd (Software Metrics Specialist).
- Praetorium Pty Ltd (IT Consultancy).

## The partnership ...

## Curtin University of Technology

- Curtin University of Technology, Curtin Business School is located in Perth, Western Australia.
- Research is conducted by Diane Jamieson, Senior Research Fellow.
- Project co-ordinator is Prof. Guy Callender.

## Defence Materiel Organisation (DMO)

- Research assisted by John Brown, Assistant Director - Directorate of Supportability.
- DMO brings together acquisition of capital equipment and systems and through life support of materiel for the Australian Defence Force.

## Defence Materiel Organisation (DMO)

- Over the last 3 years, the DMO has been changing the way it does Defence business to become a truly whole of life acquisition, support and logistics operation.
- DMO is a modern Defence materiel business with a strong and close relationship with government and other customers.

**Notes:**
Used as a collective term for the articles, supplies, machinery, etc. used in an army, navy, or business, as distinguished from the personnel or body of persons employed.
1827 Lincoln & Lincolnsh. Cabinet 29 A more easy method of transporting the materiel for their army.  
1856 Emerson Eng. Traits xv. Wks. (Bohn) II. 117 The late Mr. Walter was printer of the ‘Times’, and had gradually arranged the whole materiel of it in perfect system.  
1881 Spectator 15 Jan. 75 The Turkish army in Epirus is in desperate straits for matériel and money. 

## ADI Limited

- Represented by Kevin Vinsen, Principal Architect – Commercial Systems.
- Established in 1991 ADI's specialist software business unit is located in Perth, Western Australia (WA) and has delivered some of the most complex software projects undertaken within Australia, including command support systems and real-time combat systems for defence.

**Notes:**
ADI Ltd is one of Australia's leading defence, systems and engineering companies employing a highly skilled workforce of approximately 2,500 people across Australia.
These world-class deliveries are in operation throughout the Australasian region deployed on thousands of computers in hundreds of locations.

## Total Metrics

- Total Metrics is a software metrics specialist company located in Melbourne, Victoria.
- Total Metrics is an established, Australian owned company, based in three states which has earned a strong international reputation for delivering quality software measurement related services worldwide.
- Officially accredited by the International Function Point User Group (IFPUG) and as Certified Function Point Counting Specialists (CFPS).

**Notes:**
Total Metrics consultants have an extensive breadth of experience in function point analysis and software measurement gained from working with a wide range of applications across a variety of organisations in the public and private sector. 

## Praetorium

- Praetorium is a small IT consultancy located in Perth, Western Australia.

**Notes:**
Praetorium has specialist capability in software engineering and can demonstrate high productivity through internationally bench-marked development projects.

## Project Thinking...

_**At Application Submission (1): **_
- Software cost estimation for outsourced software development is typically characterised by:
- Different techniques applied by different parties at different times
- Different representations of requirements by different parties at different times
- Large variations in competencies of estimators.

## Project Thinking...

_**At Application Submission (2): **_
- Research aimed to:
- Take a multi-disciplinary approach,
- Develop a consistent representation of requirements and their costs for procurement specialists, project managers and software developers,
- Focus on projects where requirements are specified as use cases.

## Project Thinking...

_**Current Thinking:**_
- Many costing problems are caused by inability to specify requirements.
- Requirements engineering as a discipline is struggling to solve problems with requirements specifications.
- Software development tends to be done using iterative techniques.
- Procurement processes tend to be waterfall and incompatible with iterative software development.
- Development of iterative procurement processes along the lines of Evolutionary Acquisition principles could minimise uncertainty of requirement and cost.

## Problems with Current Techniques

- Single discipline approaches.
- Problems caused by other disciplines and the implications are not understood.
- Data frequently unavailable, insufficient or incorrect.
- No universal acceptance.
- Many estimates are incorrect.

## Future Research

- Improving Life Cycle Costing for ownership costs for large complex operational systems.
- Many LCC techniques are available
- LCC standards are premised on the ability to create a suitable Cost Breakdown Structure
- However, we all still get it wrong
- If you think you do it well – please tell me!

## Project Contacts:

- _john.brown15@defence.gov.au_
- Phone: +61 2 6265 3942

- _diane.jamieson@cbs.curtin.edu.au_
- Phone: +61 8 9266 4746

- _kevin.vinsen@adi-limited.com_
- Phone: +61 8 9333 8728

- _guy.callender@cbs.curtin.edu.au_
- Phone: +61 8 9266 1134

- _pam.morris@totalmetrics.com_
- Phone: +61 3 9882 7611

## What is Australian Defence doing in relation to Cost Estimation?

## In 2003, Mr Malcolm Kinnaird was commissioned to conduct a review into problems associated with major Defence acquisition projects.
LCC related recommendation was that the Australian Government should mandate, and enforce, a rigorous two-pass system for new acquisitions with government considerations on comprehensive analyses of technology, cost and schedule risks. This now happens.

- LCC related recommendation was that the Australian Government should mandate, and enforce, a rigorous two-pass system for new acquisitions with government considerations on comprehensive analyses of technology, cost and schedule risks. This now happens.

- _Defence Procurement Review_

## Cost & Schedule

- Greater emphasis needs to be placed on cost and schedule estimating as a critical Defence competency to support the financial capability decision-making processes throughout the life-cycle of Defence capability.
- The need for an agreed and consistent approach to whole-of-life cost estimation is widely recognised across Defence.
- DMO has constructed a ‘Cost & Schedule Estimation Methodology’.

## Airborne Early Warning & Control Project (1)

- DMO’s largest and most software-intensive project.
- Also known as ‘Project Wedgetail’ and ‘AIR5077’.
- The AEW&C capability will provide the Australian Defence Force with an enhanced surveillance capability in the broad expanse of Australia’s north.

## Airborne Early Warning & Control Project (2)

- Recipient of the Practical Software & Systems Management award for outstanding efforts in implementing PSM into a complex and diverse environment.
- Required 1 million lines of new code to be integrated with 2.75 million lines of modified and reused code.
- For Project updates go to: _www.defence.gov.au/dmo/ascd/air5077.cfm_

## Useful Links

- Defence Materiel Organisation (DMO):
- _http://www.defence.gov.au/dmo__ _
- Curtin University of Technology:
- _http://www.cbs.curtin.edu.au__ _
- ADI Limited:
- _http://www.adi-limited.com_
- Total Metrics:
- _http://www.totalmetrics.com_
- Australian Research Council (ARC):
- _http://www.arc.gov.au__ _

## Questions?

- _Questions?_