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Standardizing Space Systems O&M Cost Estimating

Models Track

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This presentation addresses the importance of standardized Operations and Maintenance (O&M) cost estimation within the space cost community. Currently there are at least nine active O&M cost estimating models in use by just one branch of the United States Government. Although there is a relatively large number of models there do not appear to be a comprehensive view of O&M for space systems.

Each model has been developed to meet a particular program need or space mission domain (earth orbit, planetary, manned, or unmanned) focusing on those aspects important to the program or mission. Some of this “disconnect” is a result of various points of view within the space community regarding life-cycle costing. For example, in the case of an expendable space craft and launch vehicle does the life-cycle end once that particular mission is complete? Or, does the life-cycle end when the class of spacecraft and launch vehicle phases out?

A comprehensive view of what constitutes O&M costs within a system’s life-cycle has huge implications. If one takes the view that O&M ends when a single mission ends versus a class of vehicles then the impact upon a design decision can mean selection of an expedient solution with lower development cost and high O&M. This bias toward designs with lower upfront costs versus selection of solutions which have lower O&M costs may result in the pursuit of a solution which in the long run might cost two, three or even four fold over the life-cycle of the system.

Standardized comparative analyses over time and across projects, with a variety of independent methods, are very important in accomplishing unbiased assessments of project cost plans.
The continuity of process, algorithms, and cost structure establishes consistency, which in turn improves objectivity. While it might seem that this total approach is extreme, it must be remembered that the cost plans for space development projects are inherently difficult to assess, due to the uncertainties associated with employing new technologies in hostile environments.
This multi-faceted approach, largely using parametric methodologies, enables more rigorous assessments at far less expense than would be needed with other, more labor intensive approaches. Key to successful comparative analyses is a standardized approach consisting of a standard set of cost process assumptions, cost estimating relationships, and cost estimating breakdown structure. This paper describes our research in regards to the standardization of O&M cost estimation for space community.


Robert Koury
PRICE Systems L.L.C.
Mr. Koury is currently a Senior Cost Research Analyst at PRICE Systems L.LC. of Mount Laurel New Jersey. His early career consisted of 21+ years as a US Army Infantry Officer / Operations Research Analyst. While on active duty with the US Army assigned to the US Army Concepts Analysis Agency Mr. Koury conducted research and analysis in combat weapon systems affordability and trade-off analyses. He was a primary author of the US Army’s Value Added Analysis process and techniques for the prioritization of the acquisition portion of the Army’s Program Objective Memorandum. Upon retirement from the US Army he accepted a position with Texas Instruments (TI) Defense. While at TI he continued to execute affordability and performance analysis of US Army systems. In 1999 Mr. Koury took a position with Lockheed Martin’s Maritime Systems and Sensor (MS2) Division. While at Lockheed Martin he was the manager of the Sea Based Missile Defense Studies and Analysis group conducting concept, performance, and affordability analyses. He progressed through various staff and individual contributor positions ultimately holding the position of Chief Scientist for System of Systems Engineering for MS2. Currently working at PRICE Systems L.L.C. he is responsible for the development of cost methodologies and analysis. Mr. Koury has an MS in Systems Management from the University of Southern California and a Masters of Art in National Defense and Strategic Studies from the Naval War College. He is currently on the Board of Directors for the Military Operations Research Society and active with the NDIA Systems Engineering Division.

John Long
PRICE Systems, L.L.C.
John A. Long is currently a Solutions Consultant with PRICE Systems, L.L.C. He has more than thirty years experience in cost analysis, life cycle cost analysis, risk analysis, and model development. He has been an instructor, teaching hundreds of students in the art and science of parametric estimating, and PRICE consultant for thirteen years. He has a BA in Math from Miami University, a MA in Industrial Management from Central Michigan University, a MS in Operations Research from the Air Force Institute of Technology, and a PhD in Operations Research from The Ohio State University. He is a member of SCEA, ISPA, and ASMC. Dr. Long is a SCEA certified cost estimator/analyst.

Pete Stanley
Solutions Consultant and PRICE Estimating Suite Developer
PRICE Systems L.L.C.
Mr. Stanley is currently a Senior Solutions Consultant at PRICE Systems L.LC. of Mount Laurel New Jersey. His early career consisted of 11 years as a Television Broadcast Engineer With RCA, GE and Lockheed Martin. His primary duties were solving problems and maintaining Broadcast Equipment (Cameras, Professional Video Tape Recorders and Transmitters). In 2004 Mr. Stanley took a position with RCA’s PRICE Systems division. In the following 27 years, he was responsible for creating and teaching courses and supporting the PRICE products. Currently working for PRICE Systems
L.L.C. he is responsible for support and development of the PRICE Estimating suite of products. He has developed the PRICE HL (Life Cycle) model into a comprehensive Total Ownership Solution. He is currently working on enhancing the PRICE Estimating Suite of models based on customer feedback.