Comments on: Huge Cost Overrun for AEHF

By: Brownsugar

Brownsugar — Fri, 12 Sep 2008 13:13:40 +0000

I have suggest for this problem, why not set a charge of 100.00 for each Frequency used? This way frequencies would incorporated in estimates for each components that the Army uses. (e,g Radio — 32000 freq) This way the services have to add frequency charges to their estimates to cover any usages. Also, this way to service pick-up the extra charges.

By: DensityDuck

DensityDuck — Thu, 11 Sep 2008 21:23:22 +0000

Describing this as a “cost overrun” is not entirely correct, as the cost increase is due to the addition of a fourth satellite which wasn’t in the original contract.

Brownshoe: “5. They (the contractors) don’t listen to the customers”

Oh, please. If we didn’t listen to the customers, then things would be LESS expensive, because we’d build to the original contract!

By: VAPOR_ONE_NINE

VAPOR_ONE_NINE — Thu, 11 Sep 2008 17:28:05 +0000

LC,
Agreed. I found in my time with the A/F acquisition community that AFMC did a much better job. Any time a major program was handled by the “dreamers” the requirements were way beyond what could be built economically. Usually what they came up with was better handled through a technology demonstration program, not a full production effort.

By: LC

LC — Wed, 10 Sep 2008 02:21:57 +0000

Space acquisition needs to be put back under AFMC and taken away from Space Command. There is zero reason why they should be following a different course.

By: Brownshoe

Brownshoe — Tue, 09 Sep 2008 07:14:53 +0000

This is a mistake that is is consistently repeated both on the government a commercial side. I see it in my company, both on the commercial and military programs and especially on NASA programs. As a project manager, I’ve done several post-mortem analyses on projects that were in trouble or failed outright. It boils down to a series of very basic issues. The main reasons programs have cost overruns are:

1. The broken practice of requiring cost estimates for new system before any of the systems engineering work is completed.
2. The cost estimation process itself is outdated and broken.
3. Lack of honest and aggressive risk management.
4. Not enough or any focus on process optimization such as lean, Six Sigma and Theory of Constraints.
5. They (the contractors) don’t listen to the customers
6. Unrealistic assertions of budget versus required capabilities

When will we ever learn? These are not new issues and to this day I am baffled as to why we still can’t get this done right.