Posted by Human Capital Impacts in Military Acquisitions
From the Journal of Cost Analysis and Parametrics: Volume 12 | Issue 1 | January 2025
Downloadable File: JCAPv12i1-HumanCapitalImpactsinMilitaryAcquisitions-Smith
Abstract: The Department of Defense has historically struggled to control both cost and schedule growth within acquisitions programs. Many studies have investigated these issues, but very few have explored the impact of human capital in improving performance outcomes. This study performs contingency table analysis to evaluate the impact of personnel, base, and Acquisition Category (ACAT) on cost and schedule performance. The results of the study suggest that the program office estimating team composition has little to no impact on performance metrics. While it may be surprising to some that this research does not establish personnel manning as a significant driver of cost or schedule deviations, a closer examination of the findings reveals an encouraging narrative. The evidence suggests that personnel manning is currently done efficiently, representing a good news story. Given the lack of personnel significance, other factors should be investigated to control cost and schedule growth. The results also suggests that ACAT 3 programs are less likely to have performance issues of any kind, while base has no impact on performance. While the results are caveated by a small sample size, it is an important first examination of the issue especially as it relates to schedule.
Authors: Lieutenant David K. Smith, USAF, is a recent graduate of the Air Force Institute of Technology (AFIT) where he earned a Master’s of Science in Cost Analysis. He is currently a cost analyst for the Air Force Lifecycle Management Center (AFLCMC), working under the digital directorate at Hanscom Air Force Base.
Dr. Jonathan D. Ritschel is an Associate Professor of Cost Analysis in the Department of Systems Engineering and Management at AFIT. He received his BBA in Accountancy from the University of Notre Dame, MS in Cost Analysis from AFIT, and PhD in Economics from George Mason University. His research interests include public choice, the effects of acquisition reforms on cost growth in DoD weapon systems, and economic institutional analysis.
Dr. Brandon M. Lucas is an Assistant Professor of Systems Integration & Cost Analysis in the Department of Systems Engineering and Management at AFIT. He holds a BA in History from the University of Texas at Austin, a MA in International Relations and ME in Teacher Education from the University of Oklahoma, a MS in Cost Analysis from AFIT, and a PhD in Economics from George Mason University. Dr. Lucas’ research interests include profit analysis, cost & economic analyses, and incentive structures.
Dr. Edward D. White is a Professor of Statistics in the Department of Mathematics and Statistics at AFIT. He received his BS in Mathematics from the University of Tampa, MAS from The Ohio State University, and PhD in Statistics from Texas A&M University. His primary research interests include statistical modeling, simulation, and data analytics.
Mr. Shawn M. Valentine is an Operations Research Analyst at AFLCMC/FZCE at Wright Patterson AFB, Ohio. Mr. Valentine graduated from Ohio University with a Bachelor of Science (BS) in Actuarial Science and a Master of Science (MS) in Financial Economics.