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PSAD-78-74 1 (1978-03-02)

handle is hein.gao/gaobaawqm0001 and id is 1 raw text is: 



DOCO DUET 335511


05054 - (B06255281

Review of Life Cycle Cost Concept. PSAD-8-*    8-163058. march
2. 1978, 9 pp.

Report to Secretaryv Department of Defense; by Richard U.
Gutaann, Director. Frocurement and Systems acquisition Div.

Contact: Procurement and Systems acquisition Div.
Budget. Function: National Defense: Department of Defense -
    Procurement & Contracts (05).
Organization Zoncerned: Department of the air Force; Department
    of the army; Department of the Navy.
Congressional Rolevance: House Committee on Armed Services
    Senate Comaittee on Armed Services.

         a former report, Life Cycle Cost ktimating--Its
Status and Potential Use in major Weapon System cquisitions,*
included recommendations that the Department of Defense explore
approaches to accumulating ownership costs for systems under
development and standardize costs elements Included in
life-cycle costs (LCC) estimates. Actions have been initiated
encouraging the use of LCC considerations in decisionmakIng, but
progress has been slow. Issuance of guidance and operating and
support (06S) costs accumulation and reporting has been spotty,
and the effect of initiated actions is just being recognized.
Issues requiring attention are: accountability for meeting 065
cost goals is unclear, assumptions for developing OS estimates
are not rpdated to show changes in program reguiresents, 06S
estimates are not reported to the Congress, costs of aGS data
are not compared to benefits, and more LCC training is needed.
To make LCC a viable factor in controlling 05S costa, the
Secretary of Defense should: accelerate efforts to provide
uniform and standard costs definitions and cost-estimatiAng
guides, hold program managers accountable for 055 costJ, require
systematic updating and reporting of LCC estimates, and provide.
program managers expert cost analysts to assist in LCC decisions
and tradeoffs. (HTV)

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