Complexity in an Unexpected Place: Quantities in Selected Acquisition Reports
https://www.dau.edu
and SARs are the best source for comparisons across programs. While it is the nature of research that we cannot predict which research projects will yield fruitful results, we know that better quality data will generally yield better research results. Nunn-McCurdy Breaches Critical Nunn-McCurdy (N-M) Act breaches are established by 10U.S.C. § 2433 (Nunn-McCurdy Act, 1981; SelectedAcquisitionReports, 2019). If an MDAP sustains too much cost growth, a review takes place that generally leads either to changes in the program or, occasionally, termination. Program managers (PMs) generally want to avoid N-M breaches. “Too much” cost growth is defned in terms of Average Procurement Unit Cost (APUC) or ProgramAcquisition Unit Cost (PAUC). APUC = Procurement Costs/Procurement Quantities PAUC = Total ProgramCosts/(Procurement + RDT&E Quantities) There are four possible critical N-M breaches—two for APUC and two for PAUC. The breach calculation is performed by measuring the percentage growth in APUC or PAUC. A critical breach occurs when the variable has increased by at least 25% against the current Acquisition ProgramBaseline (APB) or 50%against the original APB. The original APB is theAPB that was established during the Milestone (MS) B decision (formerly MS II). Each SAR contains a unit cost report that compares the current APUC and PAUC estimates to the original APB; and a second unit cost report compares the estimates to the current APB if the current APB is not the same as the original one. Subprograms An MDAP’s baseline may indicate that it has multiple subprograms to increase visibility into the program’s activities. If so, each unit produced and each dollar spent is assigned to one of the subprograms. Subprograms have been used to distinguish variants of a system such as two similar but not identical missiles or to look at diferent parts of a system, such as engines and airframes. Each year, each subprogramhas its APUC and PAUC calculated and compared to the baseline. According to the N-MAct, if any subprogramexceeds its thresholds, anN-Mbreach is declared for the entire program, not just the subprogram that exceeded its baseline.
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Defense ARJ, January 2020, Vol. 27No. 1 : 28-59
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