# Presentation: 707497

## Cost & Cycle Time AnalysisProcess Definition Document/Handbook

- 062702.NASA CostProcesBrief

**Cost & Cycle Time Analysis****Process Definition Document/Handbook**

***June 27, 2002***

***ALE***

***    ******ALE***
***Acquisition Logistics Engineering***
***6797 North High Street - Suite 324***
***Worthington, Ohio 43085***
***614-436-1609 - Fax 614-436-1295***
***www.ale.com***

***ITB ***
***International Trade Bridge, Inc.***
***2460 N. Courtaney Pkwy, Ste 101***
***Merritt Island, FL 32953***
***321-453-3838 – Fax 321-4533224***
***www.itb-inc.com***

***Presented By:***

## BRIEFING OVERVIEW

**Project Background**
** ****Project Objective**
** ****Project Approach **
**Current Core Capabilities**
** ****Cost and Cycle Time Analysis Process Definition - Emerging Results**
** ****Cost Breakdown Structure**
** ****Process Definition Document/Handbook Outline**
** ****What's Next**

## BACKGROUND

**Launch System Operations Cost Model (LSOCM-2) Requirements Analysis**
**Outcome of NASA-wide working group**
**Requirements review**
**Existing model review**
**Review of potential customers for improved LSOCM**
**Summary of requirements compared to capabilities of existing tools**
**Plan of action developed for improving cost and cycle time for future systems**

## PROJECT OBJECTIVE

**Provide a well defined process for accomplishing cost and cycle time analysis early in concept development and using the results of those analyses to influence development programs**** during space launch architecture concept development**
**Prepare a process definition document/handbook that will provide guidance for estimating cost and cycle times of space launch operations**

## PROJECT APPROACH 

**Task A/B – Develop/Document the Process****/Compile Data**
-  Use background knowledge of NASA cost analysis processes and state of the art practice and experience in effective cost analysis
**Task C - Analysis of Data**
- Integrated Definition 0 (IDEF0) methodology will be used to document the "AS IS" process of cost analysis
**Task D - Monthly Review**s
- Conduct monthly reviews with the Government to assess progress, receive guidance, and overcome issue areas
**Task E - Support Introduction of the Process**
- Introduce document/handbook process to Government or
-    industry teams to "roll out" the process

## CURRENT CORE CAPABILITIES

**CURRENT CORE CAPABILITIES**

**Mapping existing process isn’t as far along as IDEAL process**
**Difficulty stabilizing the “As-Is” relative to the Agency**
**Eight different centers contacted, eight different approaches**
**Core capabilities exist in the form of NASA Policy and Guidance**
**NPD 7120.4B Program/Project Management**
**NPD 7500.1 Program and Project Logistics Policy**
**NPG 8000.4 Risk Management Procedures and Guidelines**
**NPD 9501.3 Earned Value Performance Management**
**NASA Cost Estimating Handbook – Booz-Allen contract to IPAO**

***Provides the how, but not the what and ***
***when to do cost estimates ***
***or the relationship of cycle time.***

## THE PROPOSED PROCESS - TOPICS

**Process characteristics**
**Key decision points in the PAPAC process**
**Cost and cycle time emphasis**
**Cost and cycle time analysis process**
**Analysis tools**

## PROCESS CHARACTERISTICS

**Applicable to all new launch systems**
**Serves early phases of program development**
**Provide clear, timely insights**
**Works with level of data available**
**Consistent across NASA and over time**
**Consistent with NASA’s program management process**

## KEY DECISION POINTS EARLY IN THE PAPAC PROCESS

***Cost and cycle ***
***time analyses ***
***support key***
***decisions.***

## COST AND CYCLE TIME EMPHASIS - PROGRAM DECISIONS

**Performing affordability analysis (benefit and burden)**
**Assessing risk**
**Establishing ROM cost estimate**
**Historical data**
**First order engineering estimates**
**Establishing ROM cycle time**

***Reasonable estimates***
***required.***

## COST AND CYCLE TIME EMPHASIS - PROJECT DECISIONS

**Refining cost estimates (program feasibility)**
**Well documented analogous estimate**
**Better defined engineering estimate (bottoms up)**
**Identifying cost drivers**
**Defining launch system capacity (missions, payload, cost/lb.)**

***Supportable estimates***
***required.***

## COST AND CYCLE TIME EMPHASIS - DESIGN DECISIONS

**Establishing a high confidence Baseline Cost Estimate (BCE)**
**Setting goals, targets, and threshold values**
**Performing trade studies for optimal “performance vs. cost” mix**
**Justifying program cost vs. capability**

***Defensible estimates***
***required.***

## COST ANALYSIS PROCESS OVERVIEW

***The same process applies ***
***to all phases.***

**COST ANALYSIS PROCESS OVERVIEW**

- Slide

***A***
***   ******L***
***      ******E***

- 062702.NASA CostProcesBrief

## CYCLE TIME ANALYSIS PROCESS

***Cost and cycle time***
***are directly coupled.***

**SYSTEM**
**TECHNICAL**
**CHARACTERISTIC**

**CONSTRAINTS**
**PUBLIC LAW**
**ENVIRONMENT**
**INFRASTRUCTURE**
**FUNDING**

**CYCLE TIME **
**ESTIMATING TOOL**

**CYCLE TIME **
**OBJECTIVE**

**MISSION**
**OBJECTIVES**

**DESIGN**
**TECHNOLOGY**
**POLICY**

**CYCLE **
**TIME**
**COST/ **
**CYCLE**

## ANALYSIS TOOLS

**Must migrate over phase**
**Early - simplified, limited data, macro level**
**Later - credible, comprehensive, lower level**
**Must serve decisions at hand**
**Early - which system**
**Later - which variant of a system**
**Should operate from a common data structure**

***There are tools available,***
***they need to be adapted.***

## COST BREAKDOWN STRUCTURE DEVELOPMENT

**Developed using three (3) key criteria**
**Capture program costs**
**Align with the way cost is managed**
**Facilitate mission accomplishment**
**Uses NASA program/project structure and incorporates spaceport architecture**
**Lowest levels of structure subdivided into cost elements:**
**Labor**
**Material**
**Contracts**
**Other direct costs**
**Overhead/G&A**

## COST BREAKDOWN STRUCTURE

**Project**

**1.0**

**Candidate System**

**1.1**

**Candidate System**

**1.3**

**Candidate System**

**1.2**

- System Program

- Management

- 1.2.1

**NOTE: Under the lowest depicted cost level is**

**another level showing  the following cost elements:**

**Labor; Material; Contracts; Other Direct Cost;**

**Overhead and G&A with labor broken down by**

**NASA and Other Government.**

- System

- Engineering

- 1.2.1.1

- Safety &

- Environ. Mgt

- 1.2.1.7

- Logistics

- Management

- 1.2.1.6

- Admin

- Briefs/Plan (etc)

- 1.2.1.5

- Configuration

- Management

- 1.2.1.4

- Information

- Management

- 1.2.1.3

- Resource

- Management

- 1.2.1.2

- Acquisition

- Mgt

- 1.2.1.8

- Formulation

- 1.2.2

- Infrastructure Anal.

- 1.2.2.5

- Operations &

- Business Opp. Anal.

- 1.2.2.4

- Technical Rqmts Anal.

- 1.2.2.3

- Concept/Cost Anal.

- 1.2.2.2

- Concept Plan

- Formulation

- 1.2.2.1

- Program Definition

- 1.2.2.7

- Concept Formulation

- 1.2.2.6

- Detail Design

- & Engineering

- 1.2.3

- Facilities Design

- 1.2.3.1

- Other

- 1.2.3.4

- GSE Design &

- Development

- 1.2.3.3

- * Vehicle Design

- 1.2.3.2

- Production

- 1.2.4

- 1.2.4.4

- 1.2.4.3

- 1.2.4.2

- 1.2.4.1

- Launch

- Operations

- 1.2.5

- Assembly Integration

- 1.2.5.9

- Mission Control

- 1.2.5.8

- Mission Analysis

- 1.2.5.7

- Mission Planning

- 1.2.5.6

- Transfer

- Operations

- 1.2.5.5

- Payload and Cargo

- Processing

- 1.2.5.4

- Ground Servicing

- 1.2.5.3

- Landing and

- Recovery

- 1.2.5.2

- Traffic and

- Flight Ctrl

- 1.2.5.1

- Support

- Operations

- 1.2.6

- HW/SW Organizational

- Maintenance

- 1.2.6.1

- Sustaining

- Engineering

- 1.2.6.12

- Personnel Preparation

- 1.2.6.11

- Equipment

- 1.2.6.10

- Training

- 1.2.6.9

- Data and

- Documentation

- 1.2.6.8

- System Modifications

- 1.2.6.7

- Refurbishment

- 1.2.6.6

- Storage Operations

- 1.2.6.5

- Transport

- Operations

- 1.2.6.4

- HW/SW Depot

- Maintenance

- 1.2.6.2

- Supply

- (Inv Mgt/Whs)

- 1.2.6.3

- Infrastructure

- Operations

- 1.2.7

- Facility O&M

- 1.2.7.1

- Contracting

- 1.2.7.6

- Personnel Support

- 1.2.7.5

- Environmental

- Support

- 1.2.7.4

- Communications

- 1.2.7.3

- BASOPs Support

- (Roads/Util etc)

- 1.2.7.2

- Disposal

- 1.2.8

- Hazmat

- 1.2.8.1

- Demil

- 1.2.8.2

- Transport

- 1.2.8.3

*** Vehicle design is further divided to describe**

**sub-systems.**

- Facility Construction

- & Modification

- * Vehicle Production

- GSE Production

- Other

## PROCESS DEFINITION DOCUMENT/HANDBOOK OUTLINE

**Executive Summary**
**I.****	****Introduction**
**II.****	****Scope**
**III.****	****Current State of Practice**
**IV.   Core Capabilities**
**V.****	****Process Definition**
**VI.****	****Data Requirements**
**VII.   NASA Standard Space Launch Operation Cost       **
**	****Breakdown Structure**
**VIII.  Appendix A****	****Compilation of Models and Tools**
**IX.    Appendix B****	****List of Contacts**

## WHAT’S NEXT

**Continue to detail proposed process**
**Map back to existing process**
**Prepare draft handbook**
**Develop process introduction program**