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Evolution of Cost Analyst Support: From the Late 1990s to Today

The role of the Cost/Price Analyst (C/PA) has undergone significant changes since the late 1990s. Initially focused on cost and pricing support for contracts, responsibilities have shifted from assessing complex competitive source selections and cost contracting to emphasizing commercial practices and best value approaches. Today, C/PAs play advisory roles, primarily involving fixed-price contracts and electronic ordering systems, while prioritizing reasonableness of pricing and technical value over exhaustive cost analysis. This evolution highlights the integration of procurement strategies and the growing importance of commerciality in contract actions.

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Evolution of Cost Analyst Support: From the Late 1990s to Today

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  1. COST ANALYST SUPPORT YESTERDAY AND TODAY

  2. YESTERDAY AS RECENTLY AS THE LATE 1990s COST/PRICE ANALYST (C/PA) ROLE MAINLY INVOLVED COST AND PRICING SUPPORT: • COST TYPE SUBCONTRACTS • SOLE SOURCE PROCUREMENTS • FEDERAL ACQUISITION REGULATION (FAR) PART 15 STRICT INTERPRETATION

  3. YESTERDAY AS RECENTLY AS THE LATE 1990s • LIMITED INVOLVEMENT IN CUMBERSOME AND LABOR INTENSIVE COMPETITIVE SOURCE SELECTION METHODOLOGY • C/PA PARTICIPATION LIMITED TO EVALUATION OF COST ESTIMATE AT AWARD PHASE

  4. TODAY • MOVED AWAY FROM COST CONTRACTING • VERY EXPENSIVE AND TIME CONSUMING • COPD THRESHOLD UP TO $650K • PROCUREMENT HAS A STRONG PREFERENCE FOR COMMERCIAL CONTRACTING • USE Best Value Source Selection (BVSS) for competitive awards (best combination of technical attributes and price) • MORE LATITUDE IN DEFINING COMMERCIALITY AND COMPETITION

  5. CURRENT CONTRACTUAL PREFERENCES COST/PRICE ANALYST (C/PA) ROLE NOW MAINLY INVOLVES: • FIXED PRICE • TIME AND MATERIAL • ELECTRONIC ORDERING SYSTEM CONTRACTS

  6. TODAY C/PA FUNCTION EMPHASIS • EMPHASIS ON COMMERCIALITY • Emphasis on reasonableness of price in lieu of cost analysis • BEST VALUE PROVIDES FOR EMPHASIS ON TECHNICAL VALUE VS COST • Competition eliminates the need for COPD, which requires audited/validated indirect rates.

  7. TODAY C/PA FUNCTION EMPHASIS • BV PROVIDES LATITUDE FOR DETERMINING COMPETION AND NEED FOR COPD • PROCUREMENT TEAM APPROACH • COST ANALYST MORE OF AN ADVISOR

  8. SUPPORTING AREAS C/PA ROLE AS SUBCONTRACT ADMIN. SUPPORT • EOS CONTRACTS 28% • INCURRED COSTS/BILLINGS • Work closely with SASS 20% • PROPOSALS • FP, T&M, CRSC, 15% • CLOSEOUTS 11%

  9. SUPPORTING AREAS C/PA ROLE AS SUBCONTRACT ADMIN. SUPPORT • PARTICIPATE IN ALL FORMAL REVIEW OF RFPs AND CONTRACTS 10% • FINANCIAL CAPABILITIES 7% • TIMEKEEPING SYSTEM REV. (Pre) 3% • TIMEKEEPING SYSTEM REV. (Post) 2%

  10. SUPPORTING AREAS C/PA ROLE AS SUBCONTRACT ADMIN. SUPPORT • BVSS BUYING TEAM MEMBER 1% • GUIDANCE ON PRICING ISSUES 1% • GUIDANCE ON SUPPORTING COMMERCIAL OR COMPETITION 1% • ASSISTANCE IN RFP DEV 1% • ACCOUNTING SYSTEM REV MIN.

  11. SUPPORTING AREAS PROPOSALS (15% of C/PA function) UNDER $650K20% • DCAA FURNISHED RATES 90% • COST ANALYST DETERMINED 10% OVER $650k (COPD)80% • T &M BILLING RATES 60% • DCAA AUDITS/RATES PROV 30% • COST ANALYST DETERMINED 10%

  12. SUPPORTING AREAS INCURRED COST REVIEWS (20% of C/PA function) • T&M BILLING RATES 60% • DCAA DETERMINED RATES 30% • COST ANALYST DETERMINED 10%

  13. STANDARD PROC. 15.6 COST OR PRICE ANALYSIS • Price Analysis below $100,000 • Cost Analysis at $100,000 or more • COPD $650,000 EXEMPTIONS: COMMERCIAL PRICING AND COMPETITION • COST REALISM EVALUATE ESTIMATES FOR REALISM/BEST VALUE, COMMERCIAL, COMPETITIVE OR UNDER $650,000

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