Weighted Guidelines: An Empirical Investigation of Research and Development Acquisitions.
AIR FORCE INST OF TECH WRIGHT-PATTERSON AFB OH SCHOOL OF SYSTEMS AND LOGISTICS
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Recent changes in DOD profit policy modified the weighted guidelines method of determining prenegotiation profit objectives. One Research and Development RD contracting organization expected that this modified weighted guidelines method provided prenegotiation profit objectives that were too low to be consistent with the economic realities associated with the RD market-place. Two research objectives were employed in this study to compare the difference between prenegotiation profit objectives and final negotiated profits for RD contracts categorized in two groups the RD contracts in accordance with Defense Acquisition Circular DAC 76-233, and those RD contracts in accordance with Defense Procurement Circular 76-3. The research plan was to determine if recent changes to DOD profit policy had inadvertently resulted in unrealistically low prenegotiation profit objectives. The study revealed unexpected results. The random sample of RD contracts indicated no significant difference between the prenegotiation profit objectives and final negotiated profits using the DAC 76-23 method of computing weighted guidelines.
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