Data Collection and Analysis Supporting Defendable Cost Estimates

Methods and Models I Track




Cost modeling and estimation has a long and interesting history in the Aerospace and Defense industry starting around the time of World War II. All sorts of mathematical and experiential models have been proposed and used over the years to help with bidding, planning, proposing and executing contracts. While general purpose models are useful, more and more industry and government cost professionals are asking for models built with data very specific to their industry and their organization. Unfortunately many organizations do not have the infrastructure, processes or tools for collecting project data efficiently. And among those who do, even fewer really know what to do with the data they have collected. Over the last several years, PRICE has been involved in several efforts to help organizations develop processes for data collection and analysis to support more defendable estimates.

The first of these pilots focuses on simulation software being developed and integrated by two contractors for a government customer. This government customer is frustrated with their current inability to convince their management of the validity of their estimates because they have no supporting data with which to back them up. The end goal of the initiative is to create an environment in which the government customer not only can estimate future efforts with confidence but one in which they will also be able to present this estimate up the chain of command and have it be received with credibility and acceptance.

The second pilot is focused on an industry customer with a completely different problem. This customer builds automobiles and has very detailed cost information at the part level for completed vehicles. This customer is frustrated with the fact that although they have all this detail in their databases, they are still unable to predict with any efficiency the cost implications of decisions made when developing and producing a new model vehicle. Part of the problem is that the data is kept in many different systems so collecting data for a specific vehicle or model is problematic. This pilot is currently focused on identifying cost drivers and effective cost modeling techniques for a small subset of the parts currently in their database(s). Upon successful completion of the pilot the study will be extended to a wider number of parts.

While there are many differences in these two pilots, there are several common themes which have been identified. This paper discusses lessons learned in these two separate data collection journeys. The discussion will cover the challenges that were faced, both technical and cultural, the tools that were developed or adapted to automate processes, the approaches to analysis that worked and those that didn’t as well as findings to date. This information would be useful to any organization considering incorporating more data driven techniques into their estimates.


Arlene F Minkiewicz
PRICE Systems
Ms. Minkiewicz is a software measurement expert dedicated to finding creative solutions focused on making software development professionals successful. She has over 27 years in the software industry researching all aspects of the software development process and providing thought leadership to the software community. Ms. Minkiewicz is the Chief Scientist at PRICE Systems, LLC. In this role, she leads the cost research activity for the entire suite of cost estimating products that PRICE provides. Ms. Minkiewicz has more than 27 years of experience with PRICE building cost models. She was awarded the Freiman Award for Lifetime Contributions to Parametric estimating in 2012.
Ms. Minkiewicz has an MS in Computer Science from Drexel University and a BS in Electrical Engineering from Lehigh University. She has published many articles on software measurement and estimation in Software Development, Crosstalk, and the Journal of Software Technology and has been a contributing author for several books including “Systems Cost Engineering” (Glower, 2010), “The Closed Loop: Implementation Guide for Activity Based Budgeting” (CAM-I, 2004) and “IT Measurement: Practical Advice from the Experts” (Addison Wesley, 2002). She frequently presents at industry conferences on many topics associated with hardware, software and systems estimation and has received numerous best paper awards for her research papers. She is a member of the International Society of Parametric Analysts (ISPA) and IEEE and has served on committees setting standards and best practices for estimation, measurement, and benchmarking with the Software Engineering Institute (SEI), Project Management Institute (PMI ) and The Consortium for Advanced Manufacturing International (CAM-I).