Complexity in an Unexpected Place: Quantities in Selected Acquisition Reports
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Pre-Planned Product Improvements. Pre-Planned Product Improvements (P3I) is a form of spiral acquisition in which the frst units produced do not include all of the capabilities that the procuring Service has identifed as being required. The reasons for delaying might be budget- ary, technical, operational, or some combination thereof. The key is that planners and cost analysts have a plan from the beginning to add specifc known improvements and have developed cost and schedule estimates for those improvements. This allows P3I costs to be included in the SAR and other program submissions. In the current SAR, or even the more detailed PB, reporting current or anticipated P3I costs in a transparent fashion is difcult. The additional costs beyond what the program would cost if the improvements were not made will be a mix of the following budgetary, technical, and operational activities. • Research, Development, Test, and Evaluation (RDT&E) Costs (for developing and testing the new design) • Nonrecurring Costs (for things like new documentation and tooling) • End-ItemRecurring Flyaway (EIRF) Costs (for actual produc- tion of the improved units) • Possible Non-End-Item Recurring Flyaway (NEIRF) Costs (if improvements are made to non-end-item systems) • Support Costs (if the cost of support and/or spares for the new design is not exactly the same as for the original design) For the marginal cost of improvements to be visible in the SAR, reporting would need to explicitly include P3I costs. One way to do this would be as follows: • If the planned improvements are small in number and to be done at a few discrete times during the production run, treat them like Block Upgrades (see section on Block Upgrades, p. 47). • If the planned upgrades are more numerous and continuous, establish a Planned Upgrades subprogram, and report the RDT&E and Procurement costs associated with planned changes to the original design under that subprogram. For each year in the SAR Annual Funding report, the program should report the following:
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Defense ARJ, January 2020, Vol. 27No. 1 : 28-59
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