Posted by

Aircraft Operation – Cost Models; Lessons Learned!

Methods and Models I Track



In FY10 the Air Force Cost Analysis Agency (AFCAA) asked one of its cost support contractors to study the processes in place for producing specific aircraft cost products and implement improvements, specifically concentrating on format consistency, maintainability and automation.

The periodically produced products to be studied were:
1) Aircraft Operation and Sustainment Cost Estimates
2) Cost per Flying Hour Risk Models
3) Jet Engine Maintenance Procedures versus Time on the Wing

Aircraft Operation and Sustainment Cost Estimates are produced using AFCAA’s Cost Oriented Resource Estimating (CORE) guideline. New platforms and changing design series variations present significant CORE maintenance challenges. Separate estimates for specific platforms are produced each year in ad hoc formats designed by an assigned analyst. Pre-release estimate reviews frequently uncover analyst introduced errors.

Cost per Flying Hour (CPFH) Risk Models are produced to provide an assessment of the cumulative probability of actual costs exceeding specific funding levels. Separate risk assessments are performed for each operating agency and for each platform type under its control. Maintaining historical data, accumulating up-to-date information and incorporating historical inaccuracies presents significant challenges to assigning risk to cost elements and producing justifiable estimates.

An AFCAA in-house initiative is to study jet engine maintenance data and build model(s) that can be used to run simulations for the purpose of deriving the ideal strategy for engine maintenance. An ideal strategy is one in which scheduling of maintenance activities results in minimized cost and maximized time on the wing. This initiative differs from previous studies that used maximum thrust repetitions for deriving engine replacement frequency and costs.
For each of these aircraft cost products, AFCAA hoped to develop consistent templates that were easy to maintain, incorporated data connectivity, included adequate automation to minimize analyst introduced errors, and most importantly would implement enhancements to the estimating processes to automate multi division, multi-design series, current year, FYDP and LC cost estimating capabilities.

This paper provides a detailed review of each product’s manual build process, structure and content, and then describes and demonstrates prototype products that were the results of the process improvement tasker.


James Linick
James Linick has a BS in Industrial Engineering from the University of South Florida. James started his engineering career as an installation engineer for Trident missile fire control aboard Trident submarines, phasing into a software engineer for the Trident stellar guidance system. His interest in software engineering enabled him to pursue a systems and software engineering career for more than 25 years. James frequently participated in working groups for development of costs and schedules for major weapon systems. In 2009, James formally entered the cost estimating and analysis profession. He worked directly with the Air Force Cost Analysis Agency, reporting to the Information Technology and Aircraft O&S division technical leads. James prepared non-advocate cost assessments, independent cost estimates and built complex cost models. James is currently a contractor, working for the Missile Defense Agency, as an O&S lead cost estimator. His responsibilities are to build and maintain cost models and prepare cost estimates to support executive reviews, budget requests, systems test and contingency operations.