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This presentation by Steve Watts at the Cost Estimation Conference discusses the room for enhancing cost estimation in major defence projects across the Needs, Acquisition, In-Service, and Disposal phases. Exploring high and low cost uncertainty, the presenter delves into the evolution of cost estimates, including Baseline Estimations and NPOC. Emphasizing the impact of OTS Australianisation and design alterations on project costs, schedules, and risks, the session also delves into the criticality of cost-schedule-risk alignment in meeting New Design Requirements. Key topics include Strategic Strike Options and the influence of fluctuating requirements on project outcomes.
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Presentation 2 – Major Defence Project Cost Estimation – Still Room for Improvement Presenter – Steve Watts COST ESTIMATION CONFERENCE
Cost Uncertainty & the Defence Capability Cycle NEEDS PHASE ACQUISITION PHASE IN-SERVICE PHASE DISPOSAL PHASE REQUIREMENTS PHASE FIRST PASS SECOND PASS Accept into Service DCP Entry 1st Pass 2nd Pass Cost estimate becomes more certain as project progresses High Cost Uncertainty Low Cost Uncertainty Cost Estimate Baseline Capital Estimate NPOC Estimate Cost estimate tends to grow over time as risks are realised.
OTS Australianisation New Design/Development Australianisation Change Increase in cost, schedule and risk Seemingly minor requirements changes to OTS design have major impact on cost, schedule and risk OTS Requirements REQUIREMENTS New Design Requirements COST-SCHEDULE-RISK Figure 2 – Concept Diagram – impact on cost, schedule and risk of volume of requirements
Needs PhaseWhat to Cost? Strategic Strike Options
