Lessons Learned: A Case Study in Labor Cost Estimating in a Data-Scarce Environment
Observations and lessons learned from labor rate and utilization development in a data-poor environment are discussed. A case study of an independent cost estimate for a large federal services contract forms the basis of the examples, which include a method for labor rate build-up. The method combines forward pricing rates and GSA schedules, and a mapping of labor categories from multiple disparate sources to those prescribed in the Request for Proposal (RFP). The paper and associated presentation will discuss the method of collecting labor utilization estimates, including the role of subject matter expert (SME) input, and the ways in which the disadvantages are mitigated. The RFP’s statement of work was used as the basis for organizing the labor utilization estimating effort, with noteworthy (and unintended!) effects on the estimates themselves. The implications will be discussed.
Cobec Consulting, Inc.
Kevin Schutt has 15 years of experience as a consultant and analyst in a variety of government and private sector settings. As a senior consultant for Cobec Consulting, Inc., he supports the Federal Aviation Administration in cost-benefit analysis of proposed investments in the National Airspace System. He previously worked for the Treasurer and Chief Financial Officer of AARP where he achieved significant cost savings and cash flow improvement through process analysis and redesign. As a contractor to the U.S. Department of Labor, Mr. Schutt performed statistical analysis of pension plan data and built financial models to assess the impact of regulatory reform. He also has experience in the health policy field, having created a health insurance plan claims payment model and performed actuarial reviews of Medicare HMO rate proposals submitted to the Centers for Medicare and Medicaid Services.
Mr. Schutt holds the Certified Cost Estimator/Analyst designation from the Society of Cost Estimating and Analysis, a Master of Business Administration and Master of Science in Finance dual degree from The George Washington University, and a Bachelor of Science in Mathematics from The College of William and Mary.