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Life Cycle Costing : Concepts, Problems, Structures and Data Bases
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English
Abstract
Life Cycle Costing needs to be related to sound economic principles if it is to be useful. In Defence, output cannot be measured in money and balanced in a profit and loss account. Cost models are, therefore, more often used in conjunction with models predicting Operational performance, than in isolation. Although cost and operational analysts may simultaneously be making predicitons about the same project, they go about their tasks in quite different ways using quite different techniques. The question of why this should be so and whether it is desirable will be raised. There seems, to the author, to be some confusion about what constitutes a life cycle cost ‘model’ and a simple classification and modelling structure will be described to clarify matters within the defence context. Finally, five particular problems will be discussed ranging from problems in estimating costs in high technology areas, through problems of application in the public sector, to problems in assessing and presenting risk and uncertainty.
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Citation
DANIEL, D., "Life Cycle Costing : Concepts, Problems, Structures and Data Bases," SAE Technical Paper 861786, 1986, https://doi.org/10.4271/861786.Also In
References
- DANIEL D W DARE D P ‘Cost and Utility - where does the balance lie for Governments?’ 1983 Journal of the Operational Research Society
- Aircraft Engine Life Cycle Cost Guide - Aerospace information Report AIR 1939 Society of Aerospace Engineers
- KIRKPATRICK D L I PUGH P G ‘Towards the Starship Enterprise - Are the current trends in Defence Unit Costs inexorable?’ 3rd Annual National Symposium 2 1985
- FALLY D ‘Cost Analysis of Aircraft Projects’ AGARD FMP Symposium on improvement of Combat performance for existing and future aircraft April 1986
- PUGH P G ‘Who can tell what might happen?’ Risks and contingency allowances Proceedings of the Royal Aeronautical Society Spring Convention 15-16 May 1986
- ‘A Formula for Action’ a Report to the President of Defense Acquisition by the President's Blue Ribbon Commission on Defense Management April 1986
- DANIEL D W ‘half a Century of Operational Research’ paper presented of Seventh European Congress on Operational Research EURO VII June 1985