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Proceedings of a Seminar on the Cost Estimating Process: The Need for a Common Understanding Held in Arlington, Virginia on 7-8 February 1984,

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It has always been the objective of the United States Government to acquire needed weapons systems on time and within previously established cost estimates. This objective however, has not always been achieved as unanticipated cost growths have been experienced. This Seminar brought together Defense and Industry managers who are involved with the development of cost estimates and who have the responsibility for cost decision making and the development of cost estimates. They are at a high enough level in their respective organizations to understand the cost estimating process and the causes of cost estimating problems. The objective was to develop a better understanding of the cost estimating problem, seek new ideas, and develop improved methods for management of the cost estimating process. Throughout the life cycle of any program, there will be a succession of various cost estimates from the initial estimates made when the program is first conceived to the final accounting of the costs to produce and operate the weapon system. Because industry has a major role in developing the initial cost estimates used in the budgeting and program process, it must share prime responsibility with Defense for producing weapon systems on time and within original cost estimates. Discussion within this Seminar enabled Military Industry Managers to understand how each other develop costs. The Seminar also examined the various problems in improved methods for developing and presenting cost estimates with a final objective of establishing a better understanding of this process as a vital step toward better cost management and control.

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  • Economics and Cost Analysis

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