The QUELCE Method: Using Change Drivers to Estimate Program Costs
CARNEGIE-MELLON UNIV PITTSBURGH PA PITTSBURGH United States
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Problems with cost estimation, ranging from estimator overconfidence to unintegrated tools, result in potentially billions of dollars of unanticipated expenses for Department of Defense programs. Quantifying Uncertainty in Early Lifecycle Cost Estimation QUELCE is a method, developed by the Carnegie Mellon University Software Engineering Institute, for estimating potential program costs in a way that acknowledges and uses uncertainty that occurs early in the development lifecycle. This report first familiarizes the reader with the QUELCE method. QUELCE computes a distribution of program costs based on Monte Carlo analysis of program cost driversassessed via analyses of dependency structure matrices and Bayesian belief networksand a standard project estimation tool. The analyses are based on change drivers, or changes that might occur that would substantially change the cost outcome of a program. The report then provides the current organization scheme of change drivers and describes how each one is used to determine any additional impacts that should be folded into the cost estimate. Finally, it introduces elaborations to the change drivers for application to sustainment-phase programs.
- Economics and Cost Analysis
- Statistics and Probability