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Report of the OSD CBM+ Action Group

2010 Summer Study

Information on Conducting Business Case Analyses

For Condition Based Maintenance Plus (CBM+)

Initiatives

October 2010

Office of the Secretary of Defense

Acquisition, Technology, and Logistics Maintenance Policy and Programs

Washington, D.C. 20301-3140

OSD CBM+ BCA Information Paper‐ October 2010

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Preface .......................................................................................................................................................... 3

General Guidance and Information .............................................................................................................. 3

CBM+ BCA Framework ................................................................................................................................... 5

I. Executive Summary ........................................................................................................................... 6

II. Boundaries and Assumptions ............................................................................................................ 6

III. BCA Alternatives ................................................................................................................................ 8

IV. Return on Investment (ROI) ............................................................................................................ 12

V. Risk Assessment ............................................................................................................................... 14

VI. Comparison and Sensitivity Analysis ............................................................................................... 14

VII. Conclusions ...................................................................................................................................... 14

VIII. Recommendations ........................................................................................................................... 14

CBM+ BCA Extracts ...................................................................................................................................... 15

Appendix A – CBM+ Scoping Questions ...................................................................................................... 16

Appendix B – CBM+ BCA Outline ................................................................................................................. 22

Appendix C – CBM+ Related Definitions/Descriptions ................................................................................ 23

Appendix D – CBM+ Cost Elements Structure ............................................................................................. 24

Appendix E – CBM+ Measures of Effectiveness .......................................................................................... 25

Appendix F – References ............................................................................................................................. 26

Appendix G – CBM+ BCA Reference Extracts .............................................................................................. 27

List of Figures

Figure 1 – Scoping a CBM+ BCA .................................................................................................................... 4

Figure 2 – CBM+ Infrastructure ..................................................................................................................... 5

Figure 3 – CBM+ BCA Process ........................................................................................................................ 6

Figure 4 – Example CBM+ Increments or COAs ............................................................................................. 9

Figure 5 – Summary of Common Cost Estimating Tools and Application ................................................... 11

Figure 6 – Notional CBM+ Investment and ROI Chart Examples ................................................................. 13


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Preface

The Office of the Under Secretary of Defense (OSD) for Acquisition, Technology, and Logistics (AT&L), in collaboration with the Military Services, has developed this planning guidance to assist Service Acquisition and other Department of Defense (DoD) organizational components in developing Business Case Analyses (BCAs) for evaluating and assessing methodologies and approaches to implement effective Condition Based Maintenance Plus (CBM+) initiatives within DoD system acquisition and sustainment programs. This paper documents the results and findings of an OSD‐sponsored Study Team review of CBM+ related BCA efforts from within DoD, industry, and academia in conducting BCAs for CBM+ capability/components. This paper provides a framework, general guidance, and essential factors that should be addressed to properly scope, define, and conduct a BCA for CBM+ initiatives within any phase of the acquisition lifecycle. This paper is intended to supplement existing DoD and Service‐specific guidance for developing BCAs related to CBM+. A key objective for this paper is to outline a flexible and effective BCA approach that can be tailored and affordable in both time and cost to support program manager’s implementation of CBM+ policy in accordance with the OSD CBM+ Guidebook, Reference A. This paper provides an overall CBM+ BCA process, a common set of cost elements, measures of effectiveness, a notional BCA framework, and factors to consider when assessing and subsequently conducting a CBM+ BCA. This paper should help shape an understanding of the areas that CBM+ capabilities might benefit a program/system, in order to support a go/no‐go decision and subsequent investment decisions with justifiable information. General Guidance and Information

CBM+ is the application and integration of appropriate processes, technologies, and knowledge‐based capabilities to improve the reliability and maintenance effectiveness of DoD systems and components. At its core, CBM+ is maintenance performed based on evidence of need provided by Reliability Centered Maintenance (RCM) analysis and other enabling processes and technologies. CBM+ uses a systems engineering approach to collect data, enable analysis, and support the decision‐making processes for system acquisition, operations, and sustainment. In evaluating potential CBM+ capabilities, whether they are technologies, maintenance processes, or information/data knowledge applications, a BCA needs to address these areas in a comprehensive and consistent manner, particularly when an incremental acquisition or fielding strategy is being considered. Although the basic concept and purpose of BCAs are generally understood throughout DoD, many interpretations exist regarding assessment of CBM+ capabilities to ensure appropriate and accurate considerations are given to CBM+ capabilities, costs, and benefits. So, what is a BCA? A BCA is a decision support document that identifies alternatives and presents convincing business, economic, risk, and technical arguments for selection and implementation to achieve stated organizational objectives/imperatives. A BCA does not replace the judgment of a decision maker, but rather provides an analytic and uniform foundation upon which sound investment decisions can be made. The subject of a BCA may include any significant


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investment decision that leadership is contemplating. For example, a BCA may be used to substantiate the case to invest in a new weapons system, but not at the same level as a Capabilities Based Assessment; transform business operations; develop a web‐based training curriculum; or retire an asset. In general, BCAs are designed to answer the following question: What are the likely financial and other business (non‐financial) consequences if we execute this investment decision or this action? The possibility exists that any projected savings or cost reductions identified in the BCA could be viewed as an asset available for reallocation in the budgeting process. In evaluating the potential application of a CBM+ capability, it is important to understand the desired end state from a CBM+ metrics perspective and key assumptions that may impact the system or CBM+ capability. Figure 1 outlines a general approach to help define the need for a BCA, understand and define the problem, and define the desired end state. This approach focuses on As‐Is system trends, evaluating Measures of Effectiveness (MOEs) and their cost drivers, key CBM+ metrics, determining if CBM+ is a viable solution and if so, what CBM+ capabilities are applicable, and then defining feasible solutions. Appendix A – CBM+ Scoping Questions provides some general questions and guidance that may relate to your CBM+ initiative. Answers to these questions are provided as information and an approach to support CBM+ implementation. As you plan your CBM+ BCA, they may assist in framing your general approach and strategy and ensure your CBM+ BCA is adequately defined and scoped to address key CBM+ business areas.

Figure 1 – Scoping a CBM+ BCA The National Defense Industrial Association (NDIA) final report of the Systems Enterprise Health Management (EHM) Technology Transition Study Report dated October 2009, Reference B,


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noted that “enabling technologies are not being transitioned and weapon systems are not realizing the value of the capability as quickly as they could, primarily due to inadequate implementation strategies. Properly evaluating enabling technologies with an objective of realizing the CBM+ value more quickly can be accomplished with a common method and process for conducting CBM+ BCAs.” Figure 2, the basic CBM+ infrastructure as described in the CBM+ Guidebook, displays the areas that should be considered as building blocks in designing a new system or modification of existing systems, for overall CBM+ implementation. Considering these areas enables incremental progression of levels of sophistication from foundational source data (e.g., systems/platform sensor data) through a full EHM capability. The levels of sophistication and relationship between CBM+, source data, RCM, and EHM should be considered in the systems engineering process and in conducting a CBM+ BCA.

Sensors

The CBM+

Infrastructure

Analytics

Decision support

Human interfaces

Healthassessment

Conditionmonitoring

Data management

Communications

Figure 2 – CBM+ Infrastructure CBM+ BCA Framework. Figure 3 illustrates a process intended to assist in defining assumptions and boundaries, describing the As‐Is configuration of your current system, defining alternative CBM+ courses of action (COAs) and then doing the risk assessment and sensitivity analysis to arrive at a recommended solution. Collaboration and/or interviews with the customers/ stakeholders may be needed to ensure their needs, expectations, and projected outcomes are clearly understood. This includes identifying and applying appropriate CBM+ cost and MOEs factors that should be considered in planning, conducting, and reporting results of CBM+ BCAs. The specific cost elements, MOEs, and Return on Investment (ROI) will depend on variables associated with your specific system to include: the status of its life cycle, planned product improvements, planned CBM+ increments/upgrades, as well as other external systems which interface with your system or are planned to be integrated within the life cycle of your system.


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• Understand the problem before determining what the solution should be

• What gap or shortfall is being addressed?

• Is CBM+ a viable solution? • What dimension of CBM+ is

applicable?• Describe the desired end state

of the CBM+ capability?

Define key assumptions/

boundary conditions

Assumptions & Boundaries

As-Is Configuration

Alternative CBM+ COAs

Risk Assessment *

Sensitivity Analysis

Problem & Desired End State

• Cost elements, assumptions & models

• Business/ CBM+

Processes• Def initions• Measures of

Ef fectiveness (MOEs) • Return on Investment

(ROI) • Areas not included in

the BCA• External Enablers and

Integration with other systems,

• Operating tempo• Projected useful

service life• Technology forecast

Define critical components of the

current weapon system and its

CBM+ capability

• Cost structure• Actual Costs• Measures of

Ef fectiveness (MOEs)

Describe potential alternatives

solutions/courses of action to reach the

end state

• Cost estimates • Measures of

Ef fectiveness (MOEs) • Performance levels• Risk areas

• Risks• Areas of uncertainty• Measures of

Ef fectiveness (MOEs) • TOC• Performance Levels• ROI

Analyze potential risks and conduct sensitivity analysis

of COAs.

Conclusions & Recommendations

• ROI• TOC• Criticality to mission performance and

readiness• Measures of Ef fectiveness (MOEs) • Combat Power• Risks and risk-reduction strategies

• Collaborate and or interview Customers and Stakeholders

• Understand Customer needs, expectations and projected outcomes

Figure 3 – CBM+ BCA Process The notional CBM+ BCA framework described below and provided in Appendix B – CBM+ BCA Outline is based on CBM+ related BCAs, the Defense Acquisition University (DAU) BCA Template, the Serialized Item Management (SIM) guide, and information obtained from the CBM+ BCA community that participated in the study. Appendix C provides notional definitions from various CBM+ and BCA references adapted for potential use in a CBM+ BCA.

I. Executive Summary The Executive Summary should be clear and concise and present the case for or against the investment options, and demonstrate measureable benefits or detriments to the objectives and goals. This will answer the “so what?” The Executive Summary should also address the overall approach of the BCA; the recommended course of action; pros and cons; why it is the better choice from other considered alternatives, including the ROI (if any); the process that was followed to arrive at the conclusion (including weighting and scoring summary of the criteria along with a brief discussion of how quantitative and non‐quantitative aspects were addressed, and summary results of the sensitivity analyses.); highlights of risk, uncertainties, and implementation considerations including resources required to support the recommendation.

II. Boundaries and Assumptions

a. Goals and Vision. This section should address your strategic objectives and why you are conducting a CBM+ BCA and should clearly articulate an understanding of specific problems that the proposed CBM+ capability is addressing. Include discussion of your business strategy including any phased or incremental CBM+ implementation. The general approach outlined in Figure 1 and the scoping questions provided in Appendix A, are intended help understand the problem, your vision and projected end state to properly scope of your BCA.


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b. Context and Perspective. Discuss specific CBM+ attributes or performance measures for your CBM+ implementation. Relate to specific CBM+ business needs (e.g., need to predict equipment failures, need for greater accuracy in failure prediction, need to reduce the cost of ownership, need to optimize equipment performance (availability)) and metrics as defined in the CBM+ Guidebook, Reference A. Consider any previous related BCA results that can assist in establishing a baseline for cost, MOEs, system performance, combat power, and/or mission impact.

c. CBM+ Metrics. The CBM+ Guidebook, Reference A, outlines measureable objectives for maintenance in a CBM+ environment and five relevant CBM+ operating metrics: material availability, material reliability, ownership costs, and mean down time; and logistics footprint. OSD guidance for Performance Based Logistics (PBL) USD AT&L Ltr 16 Aug 2004 c and Life Cycle Sustainment (LCS), USD AT&L Ltr 10 Mar 2007, Reference D, also provides relevant metrics that can be used to support CBM+

implementation. When defining metrics for your BCA, select a set of metrics, considering Systems Operational Effectiveness (SOEs) metrics, that fairly represent the potential costs and MOEs that you expect to be able to capture, or is available from existing data sources, monitor and properly evaluate with the BCA. Appendix C – CBM+ Related Definitions/Descriptions contains definitions for metrics based on References A, C, and D. Other metrics may also be appropriate when considering predictive capabilities such as advanced diagnostics or prognostics that enable accurate and timely prediction of Remaining Useful Life (RUL). Potential MOEs for Prognostics Health Management (PHM) systems could include advanced warning of failures; increased availability through an extension of maintenance cycles and/or timely repair actions; lower life‐cycle costs of equipment from reductions in inspection costs, downtime, inventory, and no‐fault‐founds; or improved system qualification, design, and logistical support of fielded and future systems as noted in the Analysis of ROI for PHM applied to Electronic Systems, Reference E.

d. Key Assumptions. Key assumptions constitute a critical element of the boundaries of the CBM+ BCA. Not everything included in the analysis is known. CBM+ BCAs, like any forecasting analysis, address future periods and conditions and as much as we utilize data to predict future conditions, any future datum or condition is subject to change from forces that could not be predicted when the analysis was conducted. Assumptions allow us to logically portray reasonable expectations of future circumstances. Tailoring the BCA to fit your case will require adjusting functional areas, weighting factors interfacing systems, sustainment/incremental capability improvements and service life considerations. Suggested areas to consider in defining assumptions should include: areas of integration with other systems; operating tempo; projected useful service life/remaining useful life; expected funding levels; basis for cost estimates; MOEs and related metrics (throughout the life cycle); technology forecast; CBM+ related logistics processes; and areas not addressed in the BCA. Considering these areas will help to ensure the CBM+ BCA is well scoped and defined. It is also important to understand how incremental CBM+ capability improvements may impact ROI and ensure adequate assumptions are


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defined regarding the impact of incremental improvements on ROI. These incremental improvements, as well as improvements to other systems, e.g., Global Combat Support System (GCSS), and maintenance processes, will make contributions to the CBM+ ROI as they come online. Assumptions regarding timing and capability impact on the overall CBM+ ROI should be clearly stated. The ROI contribution of other systems may be significantly greater than one depending on application, access, and use of CBM+ data.

e. Cost Structure. Clearly define the cost elements structure being applied for your BCA. Consider the OSD Cost Analysis Improvement Group (CAIG) Operations and Support Cost‐Estimating Guide, Reference F, and clearly state any assumptions being made particularly in cases where other Service systems interfaces are planned or to be implemented. Be aware that differences exist among the military services’ cost element structures and the OSD CAIG suggested cost element structure. These differences can affect the accuracy and completeness of Operating and Support (O&S) cost estimates. The October 2007 Guide provides suggested approaches and structures for preparing O&S cost estimates. The Defense Cost and Resource Center (DCARC) is a source for related reference material. Appendix D – CBM+ Cost Elements Structure provides a suggested cost element structure that can be used in your CBM+ BCA.

f. External CBM+ Enablers. Identify any systems or interfaces that will impact your CBM+ capability. In addition to making the proper assumptions regarding external systems interfaces and approaches for integrating and implementing those systems, it is also important to specifically define any parameters, protocols, and performance measures. Ensure that any external system that will impact incremental CBM+ capabilities and implementation are clearly identified and defined to the maximum extent.

g. Key Issues. Identify specific key issues that should be addressed in the costs or benefits structure associated with costs or benefits that may be misunderstood and/or misapplied in CBM+ BCA analyses, such as CBM+ metrics; capability; and data/ management system to track results over the life cycle.

h. Evaluation Criteria/Factors. Define specific evaluation criteria related to the CBM+

business needs, ROI, and MOEs.

III. BCA Alternatives. The scope of the CBM+ alternatives being considered in terms of incremental capabilities is important to properly define the As‐Is configuration and boundaries for each alternative being considered.

a. As‐Is Configuration/Condition. Define the As‐Is CBM+ configuration in terms of the existing CBM+ capability itself, the platform/weapons system it supports or is integrated into, and the current system’s CBM+ performance measures/metrics. To the maximum extent possible, describe the As‐Is configuration in terms of the CBM+ functionality (fault detection, isolation, prediction, reporting, assessment, analysis, decision‐support execution and recovery, both on and off‐board); CBM+ business needs; and operating metrics. Where incremental improvements have been


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implemented, provide any prior BCA, Economic Analysis (EA), or analytical data related to CBM+ functionality, CBM+ business needs, and metrics.

b. Description of Alternative Courses of Action (COAs). Potential alternative CBM+ solutions, whether a new system, an enhancement to fielded systems, or an entirely new concept, should be scoped based on an understanding of the program’s strategy and objectives as well as the desired end state from a CBM+ metrics perspective. Define potential alternatives to the As‐Is CBM+ capability in terms of the projected end state of the CBM+ capability as well as the platform/weapons system it supports or is integrated into. Ensure that incremental CBM+ alternatives are properly defined and address as separate COAs based on the systems overall strategy and objectives. COA should be scoped to support the overall program objectives. Figure 4 provides an example of basic CBM+ incremental capabilities.

As‐Is Exisitng platform CBM+capability

Increment 1 Initial Sensor Capability

Increment 2 Increment 1 + Portable Maintenance Aid (PMA)

Increment 3 Increment 2 + Item Unique Identification (IUID)

Increment 4 Increment 3 + Health maintenance

Increment 5 Increment 4 + Decision Support (DS)

Increment 6 Increment 5 + Logistics and C2 Enterprise connectivity

Example CBM+Increments or COAs

Figure 4– Example CBM+ Increments or COAs

c. Projected CBM+ Cost Elements and MOEs.

i. CBM+ Cost Elements. To the maximum extent possible, cost elements should be consistent with the respective Service guidelines, a work breakdown structure consistent with Mil‐Std 881 for the respective weapons systems which the CBM+ capability is being evaluated, and the OSD CAIG ‐ Operating and Support Cost‐Estimating Guide, Reference F.

(1) A number of techniques may be employed to estimate the O&S costs of a weapon system. The suitability of a specific approach will depend to a large degree on the maturity of the program and the level of detail of the available data. Most O&S estimates are accomplished using a combination of one or more of five estimating techniques; parametric, analogy, engineering estimate, actual cost, or cost factors. Cost factors for a CBM+ BCA must be tailored based on the weapon system(s) and CBM+ capability(s) being considered using the OSD Cost‐Estimating Guide, Reference F. Data normalization is a key requirement and should be thoroughly addressed in an appendix or annex to the CBM+ BCA.

(2) The specific cost element structure should follow the general OSD and Service specific cost estimating guidance and be tailored to fit your CBM+ capability. Below is a suggested framework which contains a minimum set of four cost element categories for a CBM+ BCA that must be tailored to the


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respective system and Service requirements. Ensure that recurring, non‐recurring, and infrastructural costs are addressed. Internal costs should reflect Government (military and civilian) and support contractor elements separately thereby enabling combining with external contractor costs when appropriate. A detailed set of suggested cost elements is provided at Appendix D. (a) Research and Development

(b) Investment

(c) Operation and Sustainment

(d) Disposal/System Replacement

(3) Cost models. Various cost estimating tools are available and should be considered and tailored to fit your specific system and cost structure. Commonly used tools and a summary of their application are listed and provided in Figure 5.

(a) Automated Cost Estimating Integrated Tools (ACEIT) supports estimates of Research and Development (R&D), procurement, and/or O&S costs. ACEIT integrates ACE (an automated costs estimating system with “documentation on‐the‐fly” capability and built‐in methodology library including cost estimating relationships cost models, and additional estimating sources); a library of commercial and non‐commercial cost models); RI$K (a model which quantifies risk associated with a cost estimate) and CO$TAT (a cost analysis statistical package).

(b) System Evaluation and Estimation of Resources ‐ Software Estimating Model (SEER‐SEM) is a software project estimation model built upon a mix of mathematics and statistics. It is a decision‐support and process optimization tool that estimates cost, labor, staffing, schedule, reliability, and risk associated with all types of software development projects from mainframe commercial Information Technology (IT) business applications to real‐time embedded aerospace systems.

(c) Crystal Ball (similar to @Risk estimating software) is a spreadsheet‐based application suite for predictive modeling, forecasting, simulation, and optimization.

(d) Constructive Cost Model II (COCOMO II) is a model that allows one to estimate the cost, effort, and schedule when planning a new software development activity.


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Cost Element Cost Risk AnalysisR&D Investment O&S Disposal

Model & Tools

ACE‐IT X X X X X

SEER‐SEM/SEER‐H X X X

PRICE S&H X X X X

Crystal Ball X

COCOMO II X X X X

Custom Cost Spreadsheet X X X X X

Data

Analogous Programs X X X X X

Current Contracts X X X X

Engineering Estimates X X X X

Vendor Estimates X X X X

Program Office Est. X X X X X

Gov't Planning Factors X X X X X

Figure 5 – Summary of Common Cost Estimating Tools and Application

ii. Measures of Effectiveness. MOEs should clearly answer the question, “What does this investment provide the customer, public, or organization?” It is important to understand how benefits will be measured to ensure that appropriate data and information is collected and folded into reasonable measures that support CBM+ metrics and can be tied to time‐phased changes in the system being evaluated. MOEs can be defined as an advantage, profit, or gain attained. They are commonly thought of as an investment return and should describe what the investment enables an agency to accomplish and how the mission is enhanced. Focusing on improved business outcomes rather than the technology is one of the best ways to ensure the expenditure of any resource furthers the agency’s mission. A general list of potential MOEs is provided below for use in tailoring your specific BCA. A more detailed breakdown of potential benefits and possible measures is provided in Appendix E – CBM+ Measures of Effectiveness.

1. Maintenance

a. Platform

b. Life Cycle Management

c. Operational/Unit/Squadron/Battalion/Fleet

2. System Reliability

3. Number of No Evidence of Failures (NEOF)

4. Accuracy of failure prediction

5. Equipment mean downtime (logistics responsiveness)

6. Effectiveness of platform/system condition assessment

7. Mission reliability

a. Mission abort rate


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b. Combat power/platform/system availability

8. Safety

a. Number of avoided mishaps or maintenance risks

9. System design improvements

10. Maintenance facilities usage (all levels)

11. Troubleshooting and repair action

a. Accuracy and timeliness

12. Mean down time

13. Logistics decision process(es)

a. Supply chain impacts

b. Asset accountability and inventory control

c. Spare parts management

d. Warehouse management

14. Total Ownership Cost (TOC)

a. $ per unit usage

b. Availability

c. Logistics Footprint

d. Maintenance

IV. Return on Investment (ROI) The challenge of evaluating ROI, noted in the February 1999 Federal CIO Council Capital Planning and Information Technology (IT) Investment Committee report, is “it must be a standard, repeatable process, while containing a significant degree of flexibility. The process of assessing the total value of an investment informs decision‐making, but this task can be difficult to perform without a clear agreement of the definition of terms, or paths to follow”. This is particularly true for CBM+ due to the number of factors involved in defining the CBM+ capabilities, interfaces, and MOEs to arrive at a reasonable projection for investment costs, benefits, and a realistic ROI. Figure 6 illustrates three approaches to present the impact that incremental CBM+ improvements may have on a system over the system’s life cycle. The series of charts shown in Figures 6A‐6C are examples that demonstrate a benefit/dollar over time, an investment and TOC over time and the cumulative benefit over a system’s life cycle as incremental CBM+ capabilities are implemented. Figure 6A depicts an incremental CBM+ strategy and the cumulative benefits that would be realized with each increment. In this case, CBM+ capabilities are built from increment 0, basic sensor capability through increment 5 which integrates Portable Maintenance Aid (PMA); Item Unique Identification (IUID); Health Management, Decision Support (DS) with the Logistics and Command and Control Enterprises. If your existing CBM+ strategy is based on a robust or full CBM+ capability, i.e., Increment 4 or Increment 5, the number and scope of increments may be significantly different. Incremental improvements in those cases


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maybe driven either by CBM+ technology upgrades, external system capabilities or interfaces, new data requirements or analytical/decision support tools. The actual return on investment for the CBM+ investment when leveraging external capabilities may produce a significantly greater ROI.

Figure 6A

Figure 6B

$‐

$100

$200

$300

$400

$500

$600

$700

0 2‐5 6‐10 11‐15 16‐20 21‐25 26‐30 31‐35

Cost (in millions)

Time (in years)

Incremental Investment and TOC Over Time

Total Ownership Cost

Investment

Assumes a 10‐30 % TOC savings

Example Data

Figure 6C

Figure 6 – Notional CBM+ Investment and ROI Chart Examples Figure 6B depicts “notional” investment and the total benefits associated with CBM+. Figure 6C presents a summary of a projected phased/incremental investment strategy and the impact on TOC assuming a 10‐30 percent TOC savings is achieved over the


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phasing periods. Recognizing these will vary, this example provides one approach to represent incremental ROI/benefits.

V. Risk Assessment

Conduct risk analysis in accordance with The DoD Acquisition Risk Management Guide. Your CBM+ BCA risk analysis should include any areas or processes that may significantly affect your program and provide an assessment of their likelihood and potential impact. For each alternative, identify risks that could adversely affect it, and assess the possibility that the initiative can be successful; specify a risk‐reduction strategy for each risk; and identify key parameters and conditions that impact the investment decision. Present potential contingent actions that could mitigate the uncertainty. Identify how such uncertainties impact the analysis and investment decision.

VI. Comparison and Sensitivity Analysis Compare the alternatives and rank according to net present value, risk, ROI, or primary measures/factors such as risks and areas of uncertainty, technical maturity, level of integration risk, and funding. A sensitivity analysis can answer “What if the assumptions change?” It involves evaluating the variability of an alternative’s cost, benefit, and risk with respect to a change in specific factors. The objective is to determine which factors have the greatest impact (positive or negative) on the evaluation of the alternative.

VII. Conclusions Conclusions should state results in positive terms, focusing on the most convincing elements of your analysis that support your recommendations. Provide a ranking of alternatives based on the critical MOEs.

a. Conclusions should state your case succinctly, but completely, and draw upon supporting evidence and analysis from the previous sections. Organize conclusions around ROI, TOC, critical MOEs, combat power, and, to the maximum extent possible, CBM+ business needs.

b. Conclusions should demonstrate that you did a thorough job of collecting data, applied the proper methods to assess quantitative criteria, properly assessed risks and mitigation strategies, and correctly considered subjective or qualitative criteria—all of which clearly lead to the best‐value alternative.

c. Clarify and explain any surprising or unexpected results—anything from the analysis that could be misinterpreted. In other words, be sure to tie up any “loose ends” from previous BCA sections.

VIII. Recommendations Recommendations should leave no doubt in the reader’s mind that the CBM+ BCA was conducted objectively and based on unbiased and supportable conclusions. They should provide the best‐value recommended alternative among all feasible alternatives that were evaluated based on:

a. ROI


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b. TOC

c. Criticality to mission performance and readiness – combat power

d. Fulfillment of user's requests and objectives – MOEs

e. Support of DoD's strategic objectives

Provide recommended implementation approach to include metrics to measure initiative's progress, risks of implementing the recommended alternative, and recommended risk‐reduction strategies. CBM+ BCA Extracts. Appendix G – CBM+ BCA Reference Extracts is a compilation of extracts from various CBM+ BCAs that may be of value in planning, conducting, and reporting your CBM+ BCA.


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Appendix A – CBM+ Scoping Questions

As you define your CBM+ BCA, below are some general questions may relate to your CBM+ initiative. Answers to these questions are provided as information, an approach to support CBM+ implementation, and used to ensure your CBM+ BCA is adequately defined the scoped.

1. What is the projected impact on system/component level replacement frequency? A

CBM+ capability can provide the source data and analytical capability to determine

projected Remaining Useful Life (RUL), repair/replace decisions, maintenance task

frequency, etc. In defining the scope of the BCA ensure that any Reliability Centered

Maintenance (RCM) and diagnostic/trending data is used to define assumptions and

establish a system/component maintenance/replacement MOEs baseline from which the

overall CBM+ capability cost and benefit can be assessed.

2. Are there any contract alternatives (strategies) that will impact cost and schedule?

Ensure that any known or pending contracts that may impact implementing a CBM+

capability or that may benefit from a CBM+ capability are considered when defining the

scope of the CBM+ BCA. The impact on and from related CBM+ contracts should be

addressed in the risk assessment and sensitivity analysis portion of the CBM+ BCA.

3. What cost, schedule, and performance risk is projected based on proposed technology

for procurement, implementation, and sustainment? The CBM+ BCA should provide a

conclusion and recommendation regarding the level of technology maturity and risk

associated with the technology, including a sensitivity analysis regarding cost, schedule,

and performance.

4. What maintenance tasks or functions can be eliminated or reduced? The CBM+ BCA

should identify potential functions, tasks, or systems/components (both hardware and

software) that will be impacted by a CBM+. The level of detail that the CBM+ BCA can

generate will be based on the existing system, whether an RCM analysis has been done,

and what level of maintenance data is available. To the maximum extent possible

identify the proposed capability in terms of the CBM+ functionality areas of fault

detection, isolation, prediction, reporting, assessment, analysis, decision‐support

execution, and recovery, both on and off‐board.

5. How can data analysis and decision making be automated to reduce support costs?

Ensure that your specific logistic or maintenance process(es) which will utilize an

analytical CBM+ tools/capabilities, such as trending, diagnostics and/or prognostics, are

defined and that any potential CBM+ tasks, functions, and measures of effectives/metrics

that will be affected by those tools are understood.

6. What data needs to be collected to measure the costs/benefits of the CBM+? Early

Planning for the data collection will be necessary and should examine each element and

metric as to the source of data and what factors will bear on its accuracy. While


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collection of all elements is beneficial, those response elements that are discriminators

should be the focus of the CBM+ metrics planning approach. This is best accomplished by

engaging the User community in that discussion as early as possible in the acquisition

life cycle.

7. What are the data sources and limitations for the data that needs to be collected? The

authoritative source for each data element needs to be established and a determination

of whether the data is available should be established early in the CBM+ BCA planning

process.

8. Does the CBM+ initiative improve our ability (schedule/cost/technical) to

modify/improve current systems or design new systems? Identify any “system”

specific capability that the proposed CBM+ capability will help improve for the existing

system or for projected future increments. Identify specific incremental capabilities and

external systems interfaces that the CBM+ enhances, such as connectivity to near real

time/real time weapon system health.

9. What is the TOC impact? If you are conducting a CBM+ BCA with a primarily focus on

reducing TOC, ensure that you identify the specific elements of TOC within the CBM+ BCA

assumptions and MOEs. Also, properly define any analysis factors for the risk and

sensitivity analysis to ensure conclusions and recommendations are fairly and

comprehensively reached.

10. What is the projected ROI? Ensure that you define ROI as well as an accurate estimate

of the exiting sunk cost of your existing CBM+ capability. Consider the overall life cycle of

your system to properly scope the proposed CBM+ capability and define any incremental

increases planned over the system’s life cycle. Also recognize that other interfacing or

connected systems may make a significant ROI contribution greater depending on the

application, access, and use of CBM+ data.

11. What is the impact on the following areas? A CBM+ capability can provide the source

data and analytical capability to determine projected RUL, repair/replace decisions,

maintenance task frequency, etc. In defining the scope of the BCA ensure that any RCM

and diagnostic/trending data is used to define assumptions and establish a

system/component maintenance/replacement MOEs baseline from which the overall

CBM+ capability cost and benefit can be assessed. For each of the following areas

identify specific MOEs and metrics that are appropriate to the proposed CBM+ capability:

Maintenance Planning; Manpower and Personnel; Supply Support; Support Equipment;

Computer Resources Support; Facilities; Packaging, Handling, Storage, and

Transportation; Design Interface; and Disposal.

12. What is the impact on total life cycle cost, including disposal? The CBM+ BCA cost

element structure should ensure that the desired costs and levels of detail are defined

and analyzed to support the proposed CBM+ capability. Cost drivers should be clearly


18

defined and will vary depending on the CBM+ capability. Hardware and software costs

are primary elements regardless of the life cycle phase and will vary in scope depending

on the CBM+ capability being considered (e.g., sensors, diagnostics, prognostics, etc.) .

Appendices B and C of this information paper provide a suggested cost element

structure and definitions, as well as related references for use in defining your cost

element structure.

13. How will fuel conservation be affected? If the primary CBM+ capability is focused on

energy conservation or fuel management, your CBM+ capability should be evaluated

considering areas such as: fuel sensors/monitoring; real time fuel status; accuracy of

fuel data; data transfer; fuel supply management; and system interfaces. The CBM+

BCA should identify the potential change to fuel usage and fuel management at all

levels of the operational and logistics chain. Also consider possible operational benefits

for improved fuel management, distribution, manning impacts, and system

performance Impacts.

14. What is the software maintenance strategy and projected software sustainment

cost? Identify your proposed software maintenance strategy and planned refresh

frequency. Identify any existing sunk cost in terms of existing 24/7 support and cost of

facilities and server infrastructure required to maintain the 24/7 capability. Ensure

recurring and non recurring costs are adequately defined within the cost element

structure.

15. Are there incremental performance levels? Identify the planned CBM+ capability

acquisition strategy and define how it will fit with the acquisition strategy of weapon

system it supports. Define the CBM+ increments as clearly as possible and ensure

boundaries and interfaces with existing logistics, Command and Control, and/or

weapons systems are adequately described in relationship to the CBM+ MOEs and

metrics.

16. What changes will be required for operator and maintenance personnel? And

systems? Identify known impacts to the CBM+ capability, and its parent system, to

ensure that the appropriate qualitative as well as quantitative MOEs are included.

These should include defined impacts to the system’s operation and maintenance,

policy, changes to tactics, techniques and procedures and personnel.

17. How will the repair/replace decision be affected? When the BCA is focused on a

specific system/sub‐system or component, ensure that the scope, cost elements, and

MOEs are tailored accordingly. Utilize existing RCM, cost and historical data, projected

RUL estimates, any phased CBM+ capability increments, and planned system/sub‐

system or component enhancements, wherever possible.


19

18. Will the system/equipment modernization plan be affected and if so how? Identify

those system/sub‐system and/or components where the projected CBM+ capability will

have a direct or indirect affect on a planned modernization improvement.

19. How will the CBM+ capability impact integration with other DoD systems? The CBM+

BCA should identify the specific systems for which the CBM+ capability will have a direct

interface or integration requirement. These areas should be clearly defined in the

assumptions and include the type of interface (hardware or software), timing for the

connection and all related investment and sunk costs associated with the integration.

In cases where an interfacing system has been fielded, ensure that the investment costs

are adequately addressed in assumptions to either include them in the analysis or if

they are unknown, note that they are not included.

20. How will the CBM+ capability impact service life margins? In cases where the primary

purpose of the CBM+ BCA is to determine the effect on a weapon system’s service life,

ensure that the system is properly defined and all RCM and historical data/information

(e.g., Performance and failure data from Visibility and Management of Operating and

Support Costs (VAMOSC). VAMOSC is utilized to define baseline MOEs and related

costs.

21. What is the impact on Maintenance Down Time (MDT)? To adequately assess the

impact of MDT, ensure the MDT of the existing system is defined, as well as the primary

MDT drivers (e.g., Mean Time To Repair (MTTR), logistics downtime, etc.). The primary

drivers should be key MOEs and analyzed in the sensitivity analysis.

22. How will this CBM+ system/sub‐system affect operator usability? Identify known

impacts to the CBM+ capability, and its parent system, to ensure that the appropriate

qualitative as well as quantitative MOEs are included. These should include defined

impacts to the system’s operation and maintenance, policy, changes to tactics,

techniques and procedures and personnel.

23. How will platform health monitoring affect system performance? In cases where the

primary purpose of the CBM+ BCA is to determine the effect of a health monitoring

system, ensure that the system and mission performance MOEs, metrics and investment

costs are adequately defined. To the extent possible utilized available historical

data/information (e.g., Operational Availability, Mean Down Time, Material

Availability, etc.). Select the factors that can be defined, measured, and evaluated

within your CBM+ BCA framework to ensure conclusions and recommendations are

based on a fair comparison and sensitivity analysis.

24. Does the system provide any increased prognostic/diagnostic capability? Identify

MOEs and metrics (related to failure prediction, RUL estimates, spare part

management, warehouse management, etc.) that can be assessed in terms of

timeliness, accuracy and relevance of prognostic and diagnostic analytical tools. Also,


20

consider any risks associated with source data, data transfer, and systems processing

data, as well as with the analytical tools themselves.

25. What affect does the CBM+ capability have available combat power, system readiness

and availability? The CBM+ BCA should clearly define combat power, operational

availability, and material availability for the weapon system which the CBM+ capability

is being proposed and also address any unknowns or areas that could not be addressed

in quantitative terms. Assumptions should include a defined set of mission reliability

MOEs and explain how the unknown areas will be treated in the analysis. The CBM+

BCA conclusions and recommendations should address the quantitative and qualitative

costs and benefits as well as risks associated with expected unknown areas which have

not been quantified.

26. How will this initiative improve or enhance system and operator safety? Identify

specific safety measure of effectiveness and metrics that are relevant to your system.

27. How will your overall supply chain be impacted by the CBM+ Initiative? Identify the

supply system process(es) that may be affected and specific MOEs/metrics that can be

used for the analysis. Utilize existing logistics and historical data/information (e.g.,

failure data from VAMOSC) is utilized to define baseline MOEs and related costs.

28. Will CBM+ change the way you buy and provision parts? Identify the purchasing

process (es) that may be affected and specific MOEs/metrics that can be used for the

analysis. Utilize existing RCM and historical data/information (e.g., failure data from

VAMOSC) to define baseline MOEs and related costs.

29. Can any service, DoD, Defense Logistics Agency (DLA), other infrastructure be

reduced as a result of the proposed CBM+ initiative? Identify processes, functions and

staffing related to the existing and proposed CBM+ capability and utilize any RCM,

maintenance or logistics analyses that maybe available as a source to define an existing

system baseline. Define specific MOEs (e.g., maintenance tasks, warehousing functions,

inventory management, etc.) that can be reasonably analyzed.

30. How will the various COAs or alternatives be executed (i.e., acquisition strategy) and

what is the associated cost/risk of each course of action? Ensure that the ability to

execute and implement alternatives have been addressed in the risk assessment and

sensitivity analysis. Identify and define implementation related factors in the

assumptions.

31. What maintenance and acquisition processes will be affected and how will they be

impacted in terms of data collection, transmission, and manpower costs associated

with analysis and decision making? Identify and define functions, tasks, and related

activities for maintenance, acquisition, and logistics processes (e.g., Total Life Cycle

Systems Management, PBL, Focused Logistics, Joint Capabilities Integration, and


21

Development System, Functional Needs Analysis, Functional Areas Analysis, etc.) that is

affected by or provides information about the proposed CBM+ capability.

32. How will readiness, availability, ready for tasking, down time (parts or maintenance),

and/or unscheduled down time be affected? Identify specific MOEs and metrics that

are critical to support the customer expectations. Ensure that definitions are provided

within assumptions and appropriate measures identified for analysis. Minimize the

number of metrics being evaluated to ensure reasonable amount of effort is required to

obtain and analyze data to arrive at fair and reasonable conclusions and

recommendations. Impact should be assessed using the primary CBM+ metrics ‐

Operational availability, material readiness, total ownership cost, and mean downtime.

33. What areas will this CBM+ initiative result in cost avoidance? Consider measures that

may offer direct or indirect cost avoidance such as: no evidence of failure, avoided

mishaps, reduction in spares, reduced maintenance, warehouse storage/space.

34. Will use of analytic techniques to predict failure or reduced performance levels affect

scheduled maintenance and major replacement strategies? Identify specific analytical

tools, their projected accuracy, and their specific implementation (incremental). Utilize

existing analyses, RCM studies, and historical data/information (e.g., failure data from

VAMOSC) to establish a baseline for the analysis.

35. How does this initiative improve the overall awareness of equipment condition at the

tactical and strategic levels? Identify and define any potential systems interfaces, data

exchange, decision processes, planned integration, and customer expectation in the key

assumptions. Address incremental capability improvements that may impact the CBM+

ROI as new increments become available or are integrated into the overall maintenance

and logistics processes. Ensure that relevant CBM+ functionality areas (fault detection,

isolation, prediction, reporting, assessment, analysis, decision‐support execution, and

recovery, both on and off‐board) at the operational/ tactical command and strategic

levels are assessed and addressed in the conclusions and recommendations.

36. How does this initiative increase the accuracy in failure prediction and situational

awareness? Identify specific system/sub‐system/component and existing performance

levels (failure rate, etc.) that the CBM+ capability is targeted to support. Define and

analyze related the CBM+ functionality areas of fault detection, isolation, prediction,

reporting, assessment, analysis, decision‐support execution and recovery, both on and

off‐board.


22

Appendix B – CBM+ BCA Outline

Conditional Based Maintenance Plus (CBM+) Business Case Analysis (BCA) Outline

CBM+ BCA Information Paper – October 2010

I. Executive Summary

II. Boundaries and Assumptions

a. Goals and Vision

b. Context and Perspective

c. CBM+ Metrics

d. Key Assumptions

e. Cost Structure

f. External CBM+ Enablers

g. Key Issues

h. Evaluation Criteria/Factors

III. Alternatives

a. As‐Is Configuration/Condition

b. Description of Alternative Courses of Action

c. Projected Cost Elements and Measures of Effectiveness

i. Cost Elements

ii. Measures of Effectiveness

IV. Return on Investment

V. Risk Assessment

VI. Comparison and Sensitivity Analysis

VII. Conclusions

VIII. Recommendations


23

Appendix C – CBM+ Related Definitions/Descriptions

Copy of CBM + BCA Definitions -Workshee

Eight‐page worksheet attached to Appendix C in printed copy.

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

B

usin

ess

Cas

e A

naly

sis

(BC

A)

A b

usin

ess

case

ana

lysi

s (B

CA

) is

a d

ecis

ion

supp

ort d

ocum

ent t

hat i

dent

ifies

alte

rnat

ives

and

pre

sent

s co

nvin

cing

bus

ines

s, e

cono

mic

, ris

k,

and

tech

nica

l arg

umen

ts fo

r se

lect

ion

and

impl

emen

tatio

n to

ach

ieve

sta

ted

orga

niza

tiona

l obj

ectiv

es/im

pera

tives

. A B

CA

doe

s no

t rep

lace

th

e ju

dgm

ent o

f a d

ecis

ion

mak

er, b

ut r

athe

r pr

ovid

es a

n an

alyt

ic a

nd u

nifo

rm fo

unda

tion

upon

whi

ch s

ound

inve

stm

ent d

ecis

ions

can

be

mad

e. T

he s

ubje

ct o

f a B

CA

may

incl

ude

any

sign

ifica

nt in

vest

men

t dec

isio

n th

at le

ader

ship

is c

onte

mpl

atin

g. F

or e

xam

ple,

a B

CA

may

be

used

to s

ubst

antia

te th

e ca

se to

inve

st in

a n

ew w

eapo

ns s

yste

m; t

rans

form

bus

ines

s op

erat

ions

; dev

elop

a w

eb-b

ased

trai

ning

cu

rric

ulum

; or

retir

e an

ass

et. I

n ge

nera

l, B

CA

s ar

e de

sign

ed to

ans

wer

the

follo

win

g qu

estio

n: W

hat a

re th

e lik

ely

finan

cial

and

oth

er b

usin

ess

(no

n-fin

anci

al)

cons

eque

nces

if w

e ex

ecut

e th

is in

vest

men

t dec

isio

n or

this

act

ion?

Air

For

ce M

anua

l 65-

510,

Bus

ines

s C

ase

Ana

lysi

s P

roce

dure

s, 2

2 S

epte

mbe

r 20

08; A

FM

C P

BL

BC

A C

heck

list 3

1 M

ay 2

007

Cos

t Ben

efit

Ana

lysi

s (C

BA

) A

ll C

ost B

enef

it A

naly

sis

(CB

A)

prov

ide

deci

sion

mak

ers

with

fact

s, d

ata,

and

ana

lysi

s re

quire

d to

mak

e an

info

rmed

dec

isio

n. In

its

mos

t ba

sic

form

, the

CB

A is

a to

ol to

sup

port

res

ourc

e in

form

ed d

ecis

ion

mak

ing.

The

re is

no

pres

crib

ed le

ngth

to a

CB

A. A

ll th

at is

req

uire

d is

that

it

fully

sup

port

s th

e re

com

men

datio

n. T

here

fore

, qua

lity

is g

enui

nely

mor

e im

port

ant t

han

quan

tity.

U.S

. Arm

y C

ost B

enef

it A

naly

sis

Gui

de d

ated

12

Janu

ary

2010

CB

M+

Con

ditio

n B

ased

Mai

nten

ance

Plu

s (C

BM

+)

is th

e ap

plic

atio

n an

d in

tegr

atio

n of

app

ropr

iate

pro

cess

es, t

echn

olog

ies,

and

kno

wle

dge-

base

d ca

pabi

litie

s to

impr

ove

the

relia

bilit

y an

d m

aint

enan

ce e

ffect

iven

ess

of D

oD s

yste

ms

and

com

pone

nts.

At i

ts c

ore,

CB

M+

is m

aint

enan

ce

perf

orm

ed b

ased

on

evid

ence

of n

eed

prov

ided

by

Rel

iabi

lity

Cen

tere

d M

aint

enan

ce (

RC

M)

anal

ysis

and

oth

er e

nabl

ing

proc

esse

s an

d te

chno

logi

es. C

BM

+ u

ses

a sy

stem

s en

gine

erin

g ap

proa

ch to

col

lect

dat

a, e

nabl

e an

alys

is, a

nd s

uppo

rt th

e de

cisi

on-m

akin

g pr

oces

ses

for

syst

em a

cqui

sitio

n, s

usta

inm

ent,

and

oper

atio

ns.

DoD

I 415

1.22

, Con

ditio

n B

ased

Mai

nten

ance

Plu

s (C

BM

+)

for

Mat

eria

l Mai

nten

ance

dat

ed D

ecem

ber

2, 2

007

CB

M+

Ope

ratin

g M

etric

s A

t the

hig

hest

leve

l, th

ere

are

four

mea

sura

ble

obje

ctiv

es o

f a m

aint

enan

ce p

rogr

am:

- M

ater

iel a

vaila

bilit

y—m

axim

izin

g re

adin

ess

and

avai

labi

lity

of w

eapo

n sy

stem

s an

d eq

uipm

ent

- M

ater

ial r

elia

bilit

y—im

prov

ing

relia

bilit

y of

wea

pon

syst

ems,

equ

ipm

ent,

and

com

pone

nts

- O

wne

rshi

p co

sts—

redu

cing

life

-cyc

le o

wne

rshi

p co

sts

- M

ean

dow

n tim

e—re

duci

ng m

ean

dow

n tim

e.

DoD

Con

ditio

n B

ased

Mai

nten

ance

Plu

s D

oD G

uide

book

, May

200

8

Eco

nom

ic A

naly

sis

(EA

)E

cono

mic

ana

lysi

s is

a s

yste

mat

ic a

ppro

ach

to th

e pr

oble

m o

f cho

osin

g th

e be

st m

etho

d of

allo

catin

g sc

arce

res

ourc

es to

ach

ieve

a g

iven

ob

ject

ive.

A s

ound

eco

nom

ic a

naly

sis

reco

gniz

es th

at th

ere

are

alte

rnat

ive

way

s to

mee

t a g

iven

obj

ectiv

e an

d th

at e

ach

alte

rna

tive

requ

ires

cert

ain

reso

urce

s an

d pr

oduc

es c

erta

in r

esul

ts

DoD

I 704

1.3

date

d 7

Nov

embe

r 19

95

Tim

e B

ased

Met

rics

DoD

Rel

iabi

lity,

Mai

ntai

nabi

lity,

and

Cos

t Rat

iona

le R

epor

t Man

ual

date

d 1

June

200

9

Mat

eria

l ava

ilabi

lity

Fra

ctio

n of

tota

l sys

tem

s av

aila

ble

for

oper

atio

nal u

se o

r, a

s de

fined

in S

ectio

ns 3

.1.2

.2 a

nd 3

.1.2

.3 o

f R

AM

-C

Cos

t Rat

iona

le R

epor

t, pe

rcen

tage

of t

ime

a gi

ven

syst

em is

ava

ilabl

e fo

r op

erat

iona

l use

. Not

e th

e R

AM

-C m

anua

l doe

s no

t add

ress

mat

eria

l ava

ilabi

lity

for

netw

orki

ng o

r in

form

atio

n te

chno

logy

sys

tem

s.

DoD

Rel

iabi

lity,

Mai

ntai

nabi

lity,

and

Cos

t Rat

iona

le R

epor

t Man

ual

date

d 1

June

200

9

Mat

eria

l rel

iabi

lity

The

pro

babi

lity

that

the

syst

em w

ill p

erfo

rm it

s in

tend

ed fu

nctio

n ov

er a

spe

cifie

d tim

e pe

riod

DoD

Rel

iabi

lity,

Mai

ntai

nabi

lity,

and

Cos

t Rat

iona

le R

epor

t Man

ual

date

d 1

June

200

9

Ow

ners

hip

Cos

tsO

wne

r co

st a

s de

fined

in p

ara

3.2.

4.3

of th

e R

AM

-C

Cos

t Rat

iona

le R

epor

t 2.0

Uni

t Ope

ratio

ns: 2

.1.1

(on

ly)

Ene

rgy

(fue

l, pe

trol

eum

, oil,

lu

bric

ants

(P

OL)

, ele

ctric

ity)

Not

e: T

he fu

lly b

urde

ned

cost

of f

uel i

s to

be

incl

uded

afte

r th

e on

goin

g pi

lot p

rogr

ams

have

be

en c

ompl

eted

and

po

licy

has

been

form

aliz

ed. 3

.0 M

aint

enan

ce (

all e

lem

ents

) 4

.0 S

usta

inin

g S

uppo

rt (

all e

lem

ents

exc

ept 4

.1 S

yste

m S

peci

fic T

rain

ing)

5.0

C

ontin

uing

Sys

tem

Impr

ovem

ents

(al

l ele

men

ts).

DoD

Rel

iabi

lity,

Mai

ntai

nabi

lity,

and

Cos

t Rat

iona

le R

epor

t Man

ual

date

d 1

June

200

9; C

ost A

naly

sis

Impr

ovem

ent G

roup

(C

AIG

) O

pera

ting

and

Sup

port

Cos

t-E

stim

atin

g G

uide

(O

ctob

er 2

007)

:

Mea

n D

own

Tim

eT

he a

vera

ge d

ownt

ime

for

mai

nten

ance

act

ions

(in

clud

es M

TT

R, L

DT

, and

AD

T)

DoD

Rel

iabi

lity,

Mai

ntai

nabi

lity,

and

Cos

t Rat

iona

le R

epor

t Man

ual

date

d 1

June

200

9R

OI

A p

erfo

rman

ce m

easu

re u

sed

to e

valu

ate

the

effic

ienc

y of

an

inve

stm

ent o

r to

com

pare

the

effic

ienc

y of

a n

umbe

r of

diff

eren

t in

vest

men

ts. T

o ca

lcul

ate

RO

I, th

e be

nefit

(re

turn

) of

an

inve

stm

ent i

s di

vide

d by

the

cost

of t

he in

vest

men

t; th

e re

sult

is e

xpre

ssed

as

a pe

rcen

tage

or

a ra

tio.

Dr

Edw

ard

Deg

nan,

AF

AM

S B

rief d

ated

20

Feb

200

9;

Inve

stop

edia

.com

Pag

e 1

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Co

st E

lem

ents

Res

earc

h &

Dev

elo

pm

ent

Con

sist

s of

dev

elop

men

t cos

ts in

curr

ed fr

om th

e be

ginn

ing

of th

e co

ncep

tual

pha

se th

roug

h th

e en

d of

the

syst

em d

evel

opm

ent a

nd

dem

onst

ratio

n ph

ase,

and

pot

entia

lly in

to lo

w-r

ate

initi

al p

rodu

ctio

n. T

ypic

ally

incl

udes

cos

ts o

f con

cept

ref

inem

ent t

rade

stu

dies

and

ad

vanc

ed te

chno

logy

dev

elop

men

t; sy

stem

des

ign

and

inte

grat

ion;

dev

elop

men

t, fa

bric

atio

n, a

ssem

bly,

and

test

of h

ardw

are

and

softw

are

for

prot

otyp

es a

nd/o

r en

gine

erin

g de

velo

pmen

t mod

els;

sys

tem

test

and

eva

luat

ion;

sys

tem

eng

inee

ring

and

prog

ram

man

agem

ent;

pecu

liar

and

com

mon

sup

port

equ

ipm

ent,

pecu

liar

trai

ning

equ

ipm

ent/i

nitia

l tra

inin

g, te

chni

cal p

ublic

atio

ns/d

ata,

and

initi

al s

pare

s an

d re

pai

r pa

rts

asso

ciat

ed w

ith p

roto

type

s an

d/or

eng

inee

ring

deve

lopm

ent m

odel

s.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Des

ign

Con

sist

s of

des

ign

cost

s fo

r sp

ecifi

c C

BM

+ te

chno

logi

es.

Not

e: T

o m

aint

ain

cons

iste

ncy,

CB

M+

desi

gn a

nd d

evel

opm

ent s

houl

d be

bas

ed o

n a

broa

d ar

chite

ctur

e an

d an

ent

erpr

ise

fram

ewor

k th

at is

ope

n to

mod

ifica

tion

and

can

be e

asily

adj

uste

d. C

BM

+ d

esig

ns a

t th

is p

hase

of t

he

life

cycl

e sh

ould

con

side

r in

tegr

ated

, pre

dict

ive,

pro

gnos

tics,

and

dia

gnos

tics

(CB

M +

) te

chno

logi

es a

nd m

aint

enan

ce a

ppro

ache

s th

at

min

imiz

e un

sche

dule

d re

pairs

.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Dev

elop

men

t (in

clud

e bo

th h

ardw

are

&

softw

are)

Con

sist

s of

cos

ts a

ssoc

iate

d w

ith d

evel

opm

ent o

f a c

apab

ility

to in

clud

e ha

rdw

are,

sof

twar

e an

d in

tegr

atio

n co

sts.

Ref

er to

DA

U te

chno

logy

an

d m

anuf

actu

ring

read

ines

s de

finiti

ons

to d

eter

min

e th

e te

chno

logy

rea

dine

ss le

vel a

nd s

cope

of c

osts

for

desi

gn.

Util

ize

any

exis

ting

Life

C

ycle

Cos

t Est

imat

es to

ass

ist i

n de

finin

g de

velo

pmen

t cos

ts.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Pro

toty

peC

ost s

houl

d in

clud

e th

e C

BM

+ p

roto

type

tech

nolo

gies

that

pro

vide

the

CB

M+ in

itiat

ives

.O

SD

O&

S C

ost E

stim

atin

g G

uide

(O

ct 2

007)

; Def

ense

Acq

uisi

tion

Gui

debo

ok -

DA

U

Tes

ting

& V

alid

atio

nIn

clud

es c

osts

ass

ocia

ted

with

test

ing

and

valid

atio

n of

bot

h ha

rdw

are

and

softw

are

requ

ired

to fi

eld

the

prop

osed

CB

M+ c

apab

ility

. O

SD

O&

S C

ost E

stim

atin

g G

uide

(O

ct 2

007)

; Def

ense

Acq

uisi

tion

Gui

debo

ok -

DA

U

Dat

a M

anag

emen

tD

ata

man

agem

ent c

onsi

sts

of a

cqui

ring

data

(e.

g., t

hrou

gh s

enso

rs o

r ot

her

acqu

isiti

on te

chni

ques

), m

anip

ulat

ing

dat

a in

to m

eani

ngfu

l for

m

(e.g

., co

nver

ting

anal

og to

dig

ital d

ata)

, sto

ring

data

(el

ectr

onic

ally

in d

igita

l for

m),

tran

smitt

ing

data

(th

roug

h el

ectr

onic

mea

ns),

acc

essi

ng

data

as

a ba

sis

for

anal

ysis

, and

pro

vidi

ng d

ata

(info

rmat

ion)

to d

ecis

ion

mak

ers.

CB

M G

uide

book

May

, 200

8

CB

M+

Ser

vice

s A

pplic

atio

nsC

onsi

sts

of th

e co

st o

f app

licat

ion

deve

lopm

ent,

licen

sing

, inf

rast

ruct

ure

(arc

hite

ctur

e, h

ardw

are,

sof

twar

e an

d da

ta m

anag

emen

t). E

nter

pris

e so

ftwar

e of

ten

incl

udes

sof

twar

e ap

plic

atio

ns s

imila

rto

thos

e fo

und

at th

e eq

uipm

ent l

evel

, but

may

incl

ude

data

rep

osito

ries

and

the

appl

icat

ions

that

use

info

rmat

ion

from

the

data

base

s ge

nera

ted

by e

quip

men

t sof

twar

e.

CB

M G

uide

book

May

, 200

8

Inve

stm

ent

Con

sist

s of

pro

duct

ion

and

depl

oym

ent c

osts

incu

rred

from

the

begi

nnin

g of

low

-rat

e in

itial

pro

duct

ion

thro

ugh

com

plet

ion

of d

eplo

ymen

t.T

ypic

ally

incl

udes

cos

ts a

ssoc

iate

d w

ith p

rodu

cing

and

dep

loyi

ng th

e pr

imar

y ha

rdw

are;

sys

tem

eng

inee

ring

and

prog

ram

man

agem

ent;

pecu

liar

and

com

mon

sup

port

equ

ipm

ent,

pecu

liar

trai

ning

equ

ipm

ent/i

nitia

l tra

inin

g, te

chni

cal p

ublic

atio

ns/d

ata,

and

initi

al s

pare

s an

d re

pair

part

s as

soci

ated

with

pro

duct

ion

asse

ts; i

nter

im c

ontr

acto

r su

ppor

t tha

t is

rega

rded

as

part

of t

he s

yste

m p

rodu

ctio

n an

d is

incl

uded

in th

e sc

ope

of th

e ac

quis

ition

pro

gram

bas

elin

e; a

nd m

ilita

ry c

onst

ruct

ion

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Sys

tem

acq

uisi

tion

Con

sist

s of

cos

ts a

ssoc

iate

d w

ith th

e ac

quis

ition

of t

he C

BM

+ c

apab

ility

to in

clud

e pr

ocur

emen

t, do

cum

enta

tion

and

prog

ram

sup

port

ne

cess

ary

to fi

eld

the

capa

bilit

y. R

efer

to D

oD 5

000

and

Ser

vice

spe

cific

req

uire

men

ts fo

r ne

w a

cqui

sitio

n an

d m

oder

niza

tion

of fi

elde

d as

sets

DA

U -

DoD

500

0.2

Fac

ilitie

s an

d In

fras

truc

ture

Des

crib

e, q

uant

itativ

ely

and

qual

itativ

ely,

faci

litie

s/in

fras

truc

ture

req

uire

men

ts to

sup

port

the

capa

bilit

y. Id

entif

y an

y fu

ndin

g, e

nviro

nmen

tal,

and

spac

e al

loca

tion

cons

trai

nts.

If a

sset

s ex

ist,

desc

ribe

diffe

renc

es in

req

uire

men

ts o

r up

grad

es/a

dditi

ons

need

ed.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Sup

ply

supp

ort

Ful

ly d

escr

ibe

the

supp

ly s

uppo

rt c

osts

ass

ocia

te w

ith th

e ac

quis

ition

of C

BM

+ te

chno

logi

es .

Incl

ude

the

prov

isio

ning

, org

anic

or

Con

trac

tor

Logi

stic

s S

uppo

rt (

CLS

), T

hird

Par

ty L

ogis

tics

prov

ider

(3P

L), o

r P

erfo

rman

ce B

ased

Log

istic

s (P

BL)

type

con

trac

ts, a

nd a

ny u

se o

f int

erim

co

ntra

ctor

sup

ply

supp

ort,

test

ing

supp

ort,

etc.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Tes

t equ

ipm

ent

Iden

tify

cost

s fo

r s

uppo

rt e

quip

men

t nec

essa

ry to

sup

port

the

CB

M +

cap

abili

ty/te

chno

logy

.O

SD

O&

S C

ost E

stim

atin

g G

uide

(O

ct 2

007)

; Def

ense

Acq

uisi

tion

Gui

debo

ok -

DA

U

Pro

gnos

tics/

diag

nost

ics

serv

ices

Iden

tify

cost

s of

ser

vice

leve

l agr

eem

ents

, lic

ensi

ng a

nd s

oftw

are

deve

lopm

ent f

or n

ew a

pplic

atio

ns a

nd s

ervi

ces

as w

ell a

s fo

r ex

istin

g an

d/or

pr

oprie

tary

dia

gnos

tic/p

rogn

ostic

s so

ftwar

e/al

gorit

hms.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

D

ata

War

ehou

seA

dat

a w

areh

ouse

is a

com

pute

r da

taba

se th

at c

olle

cts,

inte

grat

es, a

nd s

tore

s an

org

aniz

atio

n’s

com

pute

r da

ta w

ith th

e ai

m o

f mai

ntai

ning

an

d pr

ovid

ing

accu

rate

and

tim

ely

man

agem

ent i

nfor

mat

ion

and

supp

ortin

g da

ta a

naly

sis.

The

dat

a m

ay b

e di

strib

uted

; tha

t is,

loca

ted

at

mul

tiple

org

aniz

atio

nal a

nd lo

catio

ns.

CB

M G

uide

book

May

, 200

8

Pag

e 2

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Co

st E

lem

ents

Tra

inin

gC

onsi

sts

of c

osts

ass

ocia

ted

with

trai

ning

mat

eria

l, so

ftwar

e ap

plic

atio

ns, f

acili

ties,

sof

twar

e in

tegr

atio

n re

quire

d to

fiel

d th

e ca

pabi

lity.

Ope

ratio

n &

Sus

tain

men

tC

onsi

sts

of s

usta

inm

ent c

osts

incu

rred

from

the

initi

al s

yste

m d

eplo

ymen

t thr

ough

the

end

of s

yste

m o

pera

tions

. Inc

lude

s al

l cos

ts o

f op

erat

ing,

mai

ntai

ning

, and

sup

port

ing

a fie

lded

sys

tem

. Spe

cific

ally

, thi

s co

nsis

ts o

f the

cos

ts (

orga

nic

and

cont

ract

or)

of p

erso

nnel

, eq

uipm

ent,

supp

lies,

sof

twar

e, a

nd s

ervi

ces

asso

ciat

ed w

ith o

pera

ting,

mod

ifyin

g, m

aint

aini

ng, s

uppl

ying

, tra

inin

g, a

nd s

uppo

rtin

g a

syst

em in

th

e D

oD in

vent

ory.

May

incl

ude

inte

rim c

ontr

acto

r su

ppor

t whe

n it

is o

utsi

de th

e sc

ope

of th

e pr

oduc

tion

prog

ram

and

the

acqu

isiti

on p

rogr

am

base

line.

O&

S c

osts

incl

ude

cost

s di

rect

ly a

nd in

dire

ctly

attr

ibut

able

to th

e sy

stem

(i.e

., co

sts

that

wou

ld n

ot o

ccur

if th

e sy

stem

did

not

exi

st),

re

gard

less

of f

undi

ng s

ourc

e or

man

agem

ent c

ontr

ol. D

irect

cos

ts r

efer

to th

e re

sour

ces

imm

edia

tely

ass

ocia

ted

with

the

syst

em o

r its

op

erat

ing

unit.

Indi

rect

cos

ts r

efer

to th

e re

sour

ces

that

pro

vide

indi

rect

sup

port

to th

e sy

stem

’s m

anpo

wer

or

faci

litie

s. F

or e

xam

ple,

the

pay

and

allo

wan

ces

(ref

lect

ed in

com

posi

te s

tand

ard

rate

s) fo

r a

unit-

leve

l mai

nten

ance

tech

nici

an w

ould

be

trea

ted

as a

dire

ct c

ost,

but t

he

(pos

sibl

y al

loca

ted)

cos

t of m

edic

al s

uppo

rt fo

r th

e sa

me

tech

nici

an w

ould

be

an in

dire

ct c

ost.

OS

D O

&S

Cos

t Est

imat

ing

Gui

de (

Oct

200

7); D

efen

se A

cqui

sitio

n G

uide

book

-D

AU

Uni

t Lev

el M

anpo

wer

The

uni

t-le

vel m

anpo

wer

ele

men

t inc

lude

s th

e co

sts

of a

ll op

erat

or, m

aint

enan

ce, a

nd o

ther

sup

port

man

pow

er a

t ope

ratin

g un

its (

or a

t m

aint

enan

ce a

nd s

uppo

rt u

nits

that

are

org

aniz

atio

nally

rel

ated

and

adj

acen

t to

the

oper

atin

g un

its).

Uni

t-le

vel m

anpo

wer

incl

ude

s ac

tive

and

rese

rve

mili

tary

, gov

ernm

ent c

ivili

an, a

nd c

ontr

acto

r m

anpo

wer

cos

ts. W

hile

the

cost

ele

men

ts in

this

cat

egor

y m

ake

the

dist

inct

ion

betw

een

oper

ator

s, m

aint

aine

rs, a

nd o

ther

uni

t-le

vel m

anpo

wer

, tha

t dis

tinct

ion

may

not

app

ly to

all

situ

atio

ns. F

or e

xam

ple,

in O

&S

co

st e

stim

ates

for

Nav

y sh

ips,

the

ship

man

pow

er is

typi

cally

est

imat

ed a

nd d

ocum

ente

d fo

r th

e en

tire

crew

as

a w

hole

, and

is n

ot b

roke

n do

wn

into

ope

rato

rs,

mai

ntai

ners

, and

oth

er s

uppo

rt.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Ope

ratio

ns M

anpo

wer

The

cos

ts o

f all

mili

tary

, civ

ilian

, and

con

trac

tor

man

pow

er r

equi

red

to o

pera

te a

sys

tem

.O

SD

OS

Cos

t Est

ima

ting

Gui

de (

Oct

. 200

7)

Uni

t-Le

vel M

aint

enan

ce M

anpo

wer

The

cos

ts o

f all

mili

tary

, civ

ilian

, and

con

trac

tor

man

pow

er th

at p

erfo

rms

unit-

leve

l lev

el m

ain

tena

nce

on a

prim

ary

syst

em, a

ssoc

iate

d su

ppor

t eq

uipm

ent,

and

unit-

leve

l tra

inin

g de

vice

s. T

his

elem

ent i

nclu

des

the

cost

s of

org

aniz

atio

nal m

aint

enan

ce m

anpo

wer

(us

ually

res

iden

t in

the

syst

em o

pera

ting

unit)

and

uni

t-le

vel i

nter

med

iate

mai

nten

ance

per

sonn

el. T

he c

osts

of i

nter

med

iate

-leve

l mai

nten

ance

per

sonn

el r

esid

ent i

n a

supp

ort o

rgan

izat

ion

that

is n

ot u

nit-

leve

l rel

ativ

e to

the

oper

atin

g un

it su

ch a

s a

Nav

y sh

ore-

base

d In

term

edia

te M

aint

enan

ce A

ctiv

ity, a

re

incl

uded

in e

lem

ent 3

.2 (

Inte

rmed

iate

Mai

nten

ance

). F

or c

ases

whe

re in

divi

dual

s m

aint

ain

mor

e th

an o

ne s

yste

m, m

anpo

wer

cos

ts s

houl

d be

al

loca

ted

on a

rel

ativ

e w

orkl

oad

basi

s.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Oth

er U

nit-

Leve

l Man

pow

erT

he c

ost o

f all

mili

tary

, civ

ilian

, and

con

trac

tor

man

pow

er th

at p

erfo

rms

adm

inis

trat

ive,

sec

urity

, lo

gist

ics,

saf

ety,

eng

inee

ring,

and

oth

er

mis

sion

sup

port

func

tions

at t

he u

nit l

evel

. The

se c

osts

incl

ude

only

the

cost

s of

man

pow

er p

ositi

ons

that

exi

st to

who

lly o

r p

redo

min

atel

y su

ppor

t the

sys

tem

who

se c

osts

are

bei

ng e

stim

ated

. For

sys

tem

s th

at d

eplo

y, th

ese

cost

s in

clud

e th

e co

sts

of m

anpo

wer

pos

ition

s th

at

rout

inel

y de

ploy

to s

uppo

rt th

e sy

stem

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Uni

t Ope

ratio

nsU

nit O

pera

tions

incl

udes

the

unit-

leve

l con

sum

ptio

n of

ope

ratin

g m

ater

ials

suc

h as

fuel

, ele

ctric

ity, e

xpen

dabl

e s

tore

s, tr

aini

ng m

uniti

ons

and

othe

r op

erat

ing

mat

eria

ls. A

lso

incl

uded

are

any

uni

t-fu

nded

sup

port

act

iviti

es; t

rain

ing

devi

ces

or s

imul

ator

ope

ratio

ns th

at u

niqu

ely

supp

ort

an o

pera

tiona

l uni

t; te

mpo

rary

add

ition

al d

uty/

tem

pora

ry d

uty

(TA

D/T

DY

) as

soci

ated

with

the

unit’

s no

rmal

con

cept

of o

pera

tions

; and

oth

er

unit

fund

ed s

ervi

ces.

Uni

t-fu

nded

ser

vice

con

trac

ts fo

r ad

min

istr

ativ

e eq

uipm

ent a

s w

ell a

s un

it-fu

nded

equ

ipm

ent a

nd s

oftw

are

leas

es a

re

incl

uded

in th

is p

ortio

n of

the

estim

ate.

Uni

t Ope

ratin

g co

sts

prov

ided

thro

ugh

a sy

stem

sup

port

con

trac

t sho

uld

be s

epar

atel

y id

entif

ied

from

th

ose

prov

ided

org

anic

ally

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Ope

ratin

g M

ater

ial

Ene

rgy

(Fue

l, P

etro

leum

, Oil

and

Lubr

ican

ts [P

OL]

, Ele

ctric

ity)

The

se c

osts

incl

ude

cost

of P

OL,

pro

puls

ion

fuel

, and

fuel

add

itive

s us

ed b

y sy

stem

s in

per

form

ing

thei

r no

rmal

pea

cetim

e m

issi

ons.

The

se c

osts

als

o in

clud

e th

e co

st o

f fie

ld-g

ener

ated

ele

ctric

ity a

nd c

omm

erci

al

elec

tric

ity n

eces

sary

to s

uppo

rt th

e op

erat

ion

of a

sys

tem

. T

rain

ing

Mun

ition

s an

d E

xpen

dabl

e S

tore

s T

hese

cos

ts in

clud

e th

e u

nit-

leve

l co

nsum

ptio

n of

trai

ning

mun

ition

s, r

ocke

ts, m

issi

les,

and

exp

enda

ble

stor

es in

the

cour

se o

f nor

mal

pea

cetim

e tr

aini

ng m

issi

ons.

Incl

udes

the

cost

of l

ive

and

iner

t am

mun

ition

, bom

bs, r

ocke

ts, t

rain

ing

mis

sile

s, s

onob

uoys

, and

pyr

otec

hnic

s ex

pend

ed in

trai

ning

and

non

-com

bat f

iring

s su

ch a

s fir

epow

er d

emon

stra

tions

. Thi

s ca

tego

ry a

lso

incl

udes

oth

er e

xpen

dabl

e st

ores

suc

h as

cha

ff, fl

ares

, fue

l tan

ks, t

rave

l pod

s or

oth

er

item

s th

at lo

se th

eir

iden

tity

in u

se a

nd m

ay b

e dr

oppe

d fr

om s

tock

rec

ord

acco

unts

whe

n is

sued

or

used

. Cos

t. O

ther

Ope

ratio

nal

Mat

eria

l T

his

elem

ent i

nclu

des

oper

atin

g m

ater

ial c

osts

oth

er th

an e

nerg

y, tr

aini

ng m

uniti

ons,

or

expe

ndab

le s

tore

s. T

he c

osts

iden

tifie

d m

ust b

e re

late

d to

the

syst

em w

hose

O&

S r

equi

rem

ents

are

bei

ng a

sses

sed.

Illu

stra

tive

exam

ples

incl

ude

com

pute

r su

pplie

s, p

aper

, dis

kett

es,

ribbo

ns, c

hart

s, m

aps,

and

adm

inis

trat

ive

supp

lies

used

for

hous

ekee

ping

, hea

lth a

nd s

afet

y.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Pag

e 3

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Co

st E

lem

ents

Sup

port

Ser

vice

sT

his

incl

udes

uni

t-le

vel c

osts

for

purc

hase

d su

ppor

t ser

vice

s. T

hese

ser

vice

s m

ay v

ary

grea

tly fr

om o

ne u

nit t

o a

noth

er. T

hey

may

incl

ude

but

are

not l

imite

d to

:•

Un-

reim

burs

ed fo

od s

ervi

ces,

rat

ions

, pos

tal s

ervi

ces

(pos

tage

/box

ren

tal),

laun

dry

serv

ices

.•

Leas

e or

ren

tal o

f adm

inis

trat

ive,

com

puta

tiona

l, or

sup

port

equ

ipm

ent o

r so

ftwar

e.•

Leas

e co

sts

of s

peci

al fa

cilit

ies

or la

nd (

e.g.

, for

the

stor

age

of w

arhe

ads

and

mis

sile

s)•

Uni

t-fu

nded

ser

vice

con

trac

ts fo

r ad

min

istr

ativ

e, c

ompu

tatio

nal,

or s

uppo

rt e

quip

men

t.•

Com

mun

icat

ions

ser

vice

s (e

.g.,

data

/voi

ce li

nks,

ded

icat

ed li

nes,

mic

row

ave

chan

nels

), p

ort

ser

vice

s, a

nd o

ther

uni

t-fu

nded

util

ities

not

par

tof

bas

e op

erat

ing

supp

ort c

osts

.•

Tra

nspo

rtat

ion

cost

s fo

r m

ovin

g eq

uipm

ent (

e.g.

, com

mun

icat

ions

equ

ipm

ent,

com

bat v

ehic

les,

mis

sile

s) to

and

from

test

ran

ges

or tr

aini

ng

area

s•

Tra

nspo

rtat

ion

of p

erso

nnel

and

mat

eria

l to

rem

ote

oper

atin

g si

tes

for

oper

atio

ns, m

aint

enan

ce, o

r su

ppor

t.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Tem

pora

ry D

uty

Tem

pora

ry a

dditi

onal

dut

y or

tem

pora

ry d

uty

(TA

D/T

DY

) pa

y an

d al

low

ance

s co

sts

incl

ude

unit

pers

onne

l tra

vel f

or t

rain

ing,

adm

inis

trat

ive,

or

regu

larly

sch

edul

ed tr

aini

ng a

way

from

the

unit’

s pe

rman

ent o

pera

ting

loca

tion

that

are

ass

ocia

ted

with

a u

nit’s

con

cept

of o

pera

tions

and

su

ppor

t. T

AD

/TD

Y c

osts

incl

ude

mili

tary

and

com

mer

cial

tran

spor

tatio

n ch

arge

s, r

enta

l cos

ts fo

r pa

ssen

ger

vehi

cles

, mile

age

allo

wan

ces,

an d

subs

iste

nce

expe

nses

(e.

g., p

er d

iem

allo

wan

ces

and

inci

dent

al tr

avel

exp

ense

s). E

xclu

des

tem

pora

ry d

uty

asso

ciat

ed w

ith c

ontin

genc

ies

or

war

time

oper

atio

ns.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Dat

a w

areh

ouse

- d

ata/

softw

are

man

agem

ent

A d

ata

war

ehou

se is

a c

ompu

ter

data

base

that

col

lect

s, in

tegr

ates

, and

sto

res

an o

rgan

izat

ion’

s co

mpu

ter

data

with

the

aim

of m

aint

aini

ng

and

prov

idin

g ac

cura

te a

nd ti

mel

y m

anag

emen

t inf

orm

atio

n an

d su

ppor

ting

data

ana

lysi

s. T

he d

ata

may

be

dist

ribut

ed; t

hat i

s, lo

cate

d at

m

ultip

le o

rgan

izat

iona

l and

loca

tions

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Fac

ilitie

sA

rea

l pro

pert

y en

tity

cons

istin

g of

one

or

mor

e of

the

follo

win

g: a

bui

ldin

g, a

str

uctu

re, a

util

ity s

yste

m, p

avem

ent a

nd u

nder

lyin

g la

nd

Ser

vice

s (2

4/7)

Act

iviti

es a

ssoc

iate

d w

ith o

pera

ting,

mod

ifyin

g, m

aint

aini

ng, s

uppl

ying

, tra

inin

g, a

nd s

uppo

rtin

g a

syst

em in

the

DoD

inve

ntor

y. T

his

incl

udes

co

sts

of c

ontr

act l

abor

, mat

eria

l, an

d as

sets

use

d in

pro

vidi

ng m

aint

enan

ce s

ervi

ces

to a

wea

pon

syst

em, s

ubsy

stem

, sup

port

equ

ipm

ent,

trai

ning

dev

ice,

or

sim

ulat

or a

t the

uni

t lev

el. E

quip

men

t, m

ater

ial,

supp

lies,

and

ser

vice

s ad

opte

d by

a M

ilita

ry S

ervi

ce fo

r us

e by

its

own

forc

es a

nd a

ctiv

ities

. The

se in

clud

e st

anda

rd m

ilita

ry it

ems,

bas

e op

erat

ing

supp

ort,

and

the

supp

lies

and

serv

ices

pro

vide

d by

a M

ilita

ry

Ser

vice

to s

uppo

rt a

nd s

usta

in it

s ow

n fo

rces

, inc

ludi

ng th

ose

assi

gned

to th

e co

mba

tant

com

man

ds. I

tem

s an

d se

rvic

es d

efin

ed a

s S

ervi

ce-

com

mon

by

one

Mili

tary

Ser

vice

are

not

nec

essa

rily

Ser

vice

-com

mon

for

all o

ther

Mili

tary

Ser

vice

s.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Mai

nten

ance

(al

l ele

men

ts; s

ched

ule

and

unsc

hedu

led)

Mai

nten

ance

incl

udes

the

cost

s of

labo

r (o

utsi

de o

f the

sco

pe o

f uni

t-le

vel)

and

mat

eria

ls a

t all

leve

ls o

f mai

nten

ance

in s

upp

ort o

f the

prim

ary

syst

em, s

imul

ator

s, tr

aini

ng d

evic

es, a

nd a

ssoc

iate

d su

ppor

t equ

ipm

ent.

Whe

re c

osts

can

not b

e se

para

tely

iden

tifie

d to

dis

tinct

leve

ls o

f m

aint

enan

ce, t

he c

ateg

ory

that

rep

rese

nts

the

pred

omin

ant c

osts

sho

uld

be u

sed.

Any

mai

nten

ance

cos

ts p

rovi

ded

thro

ugh

a sy

ste

m s

uppo

r tco

ntra

ct s

houl

d be

sep

arat

ely

iden

tifie

d w

ithin

the

appr

opria

te c

ost e

lem

ent.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Org

aniz

atio

nal M

aint

enan

ceO

rgan

izat

iona

l mai

nten

ance

incl

udes

the

cost

of m

ater

ials

and

oth

er c

osts

use

d to

mai

ntai

n a

prim

ary

syst

em, t

rain

ing

devi

ces,

sim

ulat

ors,

an

d su

ppor

t equ

ipm

ent.

Mai

nten

ance

mat

eria

ls a

re b

roke

n in

to c

ateg

orie

s th

at m

ay n

ot b

e ap

plic

able

in a

ll se

rvic

es o

r fo

r al

l typ

es o

f sy

stem

s. It

is th

eref

ore

acce

ptab

le to

com

bine

con

sum

able

and

rep

air

part

s co

sts

whe

re a

ser

vice

’s lo

gist

ics

syst

em d

oes

not d

iffer

entia

te

betw

een

them

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Inte

rmed

iate

Mai

nten

ance

Inte

rmed

iate

mai

nten

ance

incl

udes

the

cost

of l

abor

and

mat

eria

ls a

nd o

ther

cos

ts e

xpen

ded

by in

term

edia

te le

vel m

aint

enan

ce o

rgan

izat

ion

in s

uppo

rt o

f a p

rimar

y sy

stem

, sim

ulat

ors,

trai

ning

dev

ices

, and

ass

ocia

ted

supp

ort e

quip

men

t. W

here

inte

rmed

iate

leve

l mai

nte

nanc

e ac

tiviti

es c

anno

t be

sepa

rate

ly id

entif

ied

from

org

aniz

atio

nal l

evel

mai

nten

ance

, the

cos

ts a

re o

ften

com

bine

d as

eith

er o

rgan

izat

iona

l or

inte

rmed

iate

mai

nten

ance

. Whe

re o

rgan

izat

iona

l and

inte

rmed

iate

mai

nten

ance

mat

eria

l or

labo

r co

sts

are

com

bine

d, th

e co

st e

stim

ate

shou

ld n

ote

that

fact

in th

e do

cum

enta

tion

to a

void

an

inte

rpre

tatio

n th

at a

por

tion

of th

e m

aint

enan

ce c

osts

wer

e om

itted

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Dep

ot M

aint

enan

ceD

epot

mai

nten

ance

incl

udes

the

fully

bur

dene

d co

st o

f lab

or, m

ater

ial,

and

over

head

incu

rred

in p

erfo

rmin

g m

ajor

ove

rhau

ls o

r ot

her

depo

t le

vel m

aint

enan

ce o

n a

syst

em, i

ts c

ompo

nent

s, o

r ot

her

asso

ciat

ed e

quip

men

t at c

entr

aliz

ed r

epai

r de

pots

, con

trac

tor

repa

ir fa

cilit

ies,

or

on

site

by

depo

t tea

ms.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Pag

e 4

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Co

st E

lem

ents

Ene

rgy

(fue

l, pe

trol

eum

, oil,

ele

ctric

ity,

etc.

. )

The

se c

osts

incl

ude

cost

of P

OL,

pro

puls

ion

fuel

, and

fuel

add

itive

s us

ed b

y sy

stem

s in

per

form

ing

thei

r no

rmal

pea

cetim

e m

issi

ons.

The

se

cost

s al

so in

clud

e th

e co

st o

f fie

ld-g

ener

ated

ele

ctric

ity a

nd c

omm

erci

al e

lect

ricity

nec

essa

ry to

sup

port

the

oper

atio

n of

a s

yste

m.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sus

tain

ing

Sup

port

T

his

cate

gory

incl

udes

sup

port

ser

vice

s pr

ovid

ed b

y ce

ntra

lly m

anag

ed s

uppo

rt a

ctiv

ities

ext

erna

l to

the

units

that

ow

n th

e op

erat

ing

syst

ems.

It

is in

tend

ed th

at c

osts

incl

uded

in th

is c

ateg

ory

repr

esen

t cos

ts th

at c

an b

e id

entif

ied

to a

spe

cific

sys

tem

and

exc

lude

cos

ts th

at m

ust b

e ar

bitr

arily

allo

cate

d. W

here

a s

ingl

e co

st e

lem

ent i

nclu

des

mul

tiple

type

s of

sup

port

, or

whe

re th

e su

ppor

t is

prov

ided

by

cont

ract

ors,

eac

h sh

ould

be

sepa

rate

ly id

entif

ied

in th

e co

st e

stim

ate.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sys

tem

s S

peci

fic T

rain

ing

The

cos

t of s

yste

m-s

peci

fic s

peci

alty

trai

ning

for

indi

vidu

als

that

nee

d to

be

repl

aced

due

to a

ttriti

on a

nd n

orm

al r

otat

ion.

Tra

inin

g co

sts

shou

ld

incl

ude

the

cost

s of

inst

ruct

ors,

trai

ning

sup

port

per

sonn

el, t

rain

ing

devi

ces,

cou

rse

supp

ort c

osts

, and

cou

rse

mat

eria

ls, a

s w

ell a

s al

l the

co

sts

of tr

aine

es, p

er d

iem

, and

trav

el d

irect

ly a

ssoc

iate

d w

ith th

e tr

aini

ng.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sup

port

Equ

ipm

ent R

epla

cem

ent

The

cos

ts in

curr

ed to

rep

lace

equ

ipm

ent t

hat i

s ne

eded

to o

pera

te o

r su

ppor

t a p

rimar

y sy

stem

, sub

syst

ems,

trai

ning

sys

tem

s, a

nd o

ther

su

ppor

t equ

ipm

ent.

The

sup

port

equ

ipm

ent b

eing

rep

lace

d (e

.g.,

tool

s an

d te

st s

ets)

may

be

uniq

ue to

the

syst

em o

r it

may

be

com

mon

to a

nu

mbe

r of

sys

tem

s, in

whi

ch c

ase

the

cost

s m

ust b

e al

loca

ted

amon

g th

e re

spec

tive

syst

ems.

Not

e: T

his

elem

ent a

ddre

sses

rep

lace

men

t equ

ipm

ent o

nly.

The

cos

t of i

nitia

l sup

port

equ

ipm

ent p

rocu

rem

ent i

s no

rmal

ly r

egar

ded

as

an

inve

stm

ent c

ost,

and

not a

s an

O&

S c

ost.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sus

tain

ing

Eng

inee

ring

and

Pro

gram

M

anag

emen

tT

he la

bor,

mat

eria

l, an

d ov

erhe

ad c

osts

incu

rred

in p

rovi

ding

con

tinue

d sy

stem

s en

gine

erin

g an

d pr

ogra

m m

anag

emen

t ove

rsig

ht to

man

age

the

prog

ram

and

to d

eter

min

e th

e in

tegr

ity o

f a s

yste

m, t

o m

aint

ain

oper

atio

nal r

elia

bilit

y, to

app

rove

des

ign

chan

ges,

and

to e

nsur

e co

nfor

man

ce w

ith e

stab

lishe

d sp

ecifi

catio

ns a

nd s

tand

ards

. In

the

case

of s

yste

ms

that

are

sim

ulta

neou

sly

in p

rodu

ctio

n an

d op

era

tions

, the

co

sts

over

and

abo

ve th

e co

sts

the

acqu

isiti

on p

rogr

am o

ffice

incu

rs to

ove

rsee

and

man

age

acqu

isiti

on p

hase

act

iviti

es a

re in

clud

ed in

the

O&

S e

stim

ate.

Whe

n a

sepa

rate

sus

tain

men

t pro

gram

man

agem

ent o

ffice

is e

stab

lishe

d or

is s

epar

atel

y id

entif

iabl

e fr

om th

e ac

quis

ition

su

ppor

t man

agem

ent o

ffice

, the

cos

ts o

f the

sus

tain

men

t pro

gram

man

agem

ent o

ffice

will

be

incl

uded

in th

e O

&S

est

imat

e.C

osts

rep

orte

d in

this

cat

egor

y m

ay in

clud

e, b

ut a

re n

ot li

mite

d to

, gov

ernm

ent a

nd/o

r co

ntra

ct e

ngin

eerin

g se

rvic

es, s

tudi

es,

and

tech

nica

l ad

vice

. Exa

mpl

es m

ight

incl

ude

airc

raft

stru

ctur

al in

tegr

ity m

onito

ring

or c

orro

sion

mon

itorin

g. S

peci

fic m

odifi

catio

ns to

har

dw

are

or s

oftw

are

are

incl

uded

in e

lem

ent 5

.0, C

ontin

uing

Sys

tem

Impr

ovem

ents

. S

usta

inin

g su

ppor

t cos

ts p

rovi

ded

thro

ugh

a sy

stem

sup

port

con

tra

ct s

houl

d be

sep

arat

ely

iden

tifie

d w

ithin

the

appr

opria

te c

ost e

lem

ent,

if po

ssib

le.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Oth

er S

usta

inin

g S

uppo

rtT

his

elem

ent i

nclu

des

any

sign

ifica

nt s

usta

inin

g su

ppor

t cos

ts n

ot o

ther

wis

e ac

coun

ted

for.

Thi

s co

st e

lem

ent m

ay b

e us

ed to

iden

tify

expe

nses

suc

h as

thos

e lis

ted

belo

w, i

f the

y ap

ply

to th

e sy

stem

for

whi

ch th

e es

timat

e is

bei

ng m

ade:

• T

est a

nd e

valu

atio

n in

sup

port

of d

eplo

yed

syst

ems,

suc

h as

ran

ge c

osts

, tes

t sup

port

, dat

a re

duct

ion,

and

test

rep

ortin

g.•

Air,

sea

, and

land

sup

port

not

fund

ed b

y th

e un

it an

d pr

ovid

ed b

y ot

her

activ

ities

to v

erify

the

prop

er o

pera

tion

of a

n el

ectr

onic

, co

mm

unic

atio

n, s

enso

r, o

r ot

her

sim

ilar

syst

em.

• C

entr

ally

pro

vide

d te

chni

cal a

ssis

tanc

e, s

uch

as H

elp

Des

ks, t

hat p

rovi

de D

oDw

ide

or S

ervi

ce-w

ide

supp

ort.

• C

omm

unic

atio

n se

rvic

es (

e.g.

, dat

a/vo

ice

links

, ded

icat

ed li

nes,

mic

row

ave

chan

nels

), h

ardw

are,

and

sof

twar

e le

ases

pur

chas

ed o

n a

DoD

-w

ide

or S

ervi

ce w

ide

basi

s fo

r di

rect

sys

tem

spe

cific

sup

port

of a

sys

tem

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Indi

rect

Sup

port

Indi

rect

sup

port

cos

ts a

re th

ose

inst

alla

tion

and

pers

onne

l sup

port

cos

ts th

at c

anno

t be

dire

ctly

rel

ated

to th

e un

its a

nd p

erso

nnel

that

ope

rate

an

d su

ppor

t the

sys

tem

bei

ng a

naly

zed.

O&

S c

ost a

naly

ses

shou

ld in

clud

e m

argi

nal i

ndire

ct c

osts

. The

inte

ntio

n is

to in

clud

e o

nly

the

cost

s th

at w

ould

like

ly c

hang

e if

the

actio

n be

ing

anal

yzed

(e.

g., n

ew s

yste

m d

evel

opm

ent,

etc.

) oc

curs

. In

dire

ct s

uppo

rt c

osts

are

mor

e re

leva

nt in

si

tuat

ions

whe

n to

tal D

oD m

anpo

wer

wou

ld c

hang

e or

whe

n in

stal

latio

ns a

re a

ffect

ed (

i.e.,

expa

nded

, con

trac

ted,

ope

ned,

or

clos

ed).

Ind

irect

su

ppor

t cos

ts m

ay a

lso

be r

elev

ant i

n an

alys

es in

volv

ing

a ch

oice

bet

wee

n go

vern

men

t and

con

trac

ted

supp

ort.

In th

ese

case

s it

is im

port

ant

to c

ompa

re th

e go

vern

men

t and

con

trac

ted

alte

rnat

ives

on

a co

mpa

rabl

e ba

sis,

incl

udin

g th

e re

leva

nt in

dire

ct c

osts

of a

ll al

tern

ativ

es.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Inst

alla

tion

Sup

port

Incl

udes

bas

e op

erat

ions

sup

port

; fac

ilitie

s su

stai

nmen

t, re

stor

atio

n, a

nd m

oder

niza

tion;

bas

e co

mm

unic

atio

ns; a

nd o

ther

sim

ilar

cost

s. B

ase

oper

atin

g su

ppor

t may

incl

ude

func

tions

suc

h as

com

mun

icat

ions

, sup

ply

oper

atio

ns, p

erso

nnel

ser

vice

s, in

stal

latio

n se

curit

y, b

ase

tran

spor

tatio

n, e

tc.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Per

sonn

el S

uppo

rtIn

clud

es th

e co

sts

for

the

acqu

isiti

on, i

nitia

l tra

inin

g, a

nd q

ualit

y of

life

pro

gram

s ne

cess

ary

to m

aint

ain

a q

ualit

y fo

rce.

Indi

rect

per

sonn

el

supp

ort c

osts

are

freq

uent

ly a

lloca

ted

to a

sys

tem

bas

ed o

n th

e nu

mbe

r an

d ty

pe o

f sys

tem

-spe

cific

indi

vidu

als

iden

tifie

d in

the

Uni

t M

anpo

wer

por

tion

of th

e O

&S

cos

t est

imat

e.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Per

sonn

el A

dmin

- A

cqui

sitio

n an

d O

verh

ead

acco

unts

Incl

udes

cos

ts fo

r re

crui

ting,

exa

min

ing

and

proc

essi

ng in

divi

dual

s in

to th

e m

ilita

ry s

ervi

ce a

nd fo

r ad

vert

isin

g in

sup

port

of

recr

uitin

g ac

tiviti

es.O

SD

OS

Cos

t Est

imat

ing

Gui

de (

Oct

. 200

7)

Per

sonn

el B

enef

itsIn

clud

es c

osts

for

oper

atio

n an

d m

aint

enan

ce o

f fam

ily h

ousi

ng c

hild

dev

elop

men

t cen

ters

, fam

ily c

ente

rs, f

amily

adv

ocac

y pr

ogra

ms,

you

th

deve

lopm

ent p

rogr

ams,

com

mis

sarie

s an

d D

oD s

choo

ls.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Pag

e 5

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Co

st E

lem

ents

Med

ical

T

he c

osts

for

med

ical

car

e fo

r ac

tive

duty

per

sonn

el a

nd th

eir

depe

nden

ts.

Incl

udes

pro

visi

ons

for

patie

nt c

are

in r

egio

nal d

efen

se fa

cilit

ies,

st

atio

n ho

spita

ls a

nd m

edic

al c

linic

s, a

nd d

enta

l fac

ilitie

s as

wel

l as

care

in n

on-d

efen

se fa

cilit

ies.

Als

o in

clud

es T

RIC

AR

E a

nd o

ther

hea

lth

supp

ort a

ctiv

ities

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Gen

eral

Tra

inin

g an

d E

duca

tion

The

cos

ts fo

r ge

nera

l tra

inin

g an

d ed

ucat

ion

not a

ssoc

iate

d w

ith a

spe

cific

wea

pon

or o

ther

sys

tem

pro

vide

d th

roug

h ce

ntra

l act

iviti

es.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Bas

ic &

Initi

al S

kill

Tra

inin

gIn

clud

es th

e co

sts

of r

ecru

it an

d in

itial

ski

lls tr

aini

ng.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Edu

catio

nal A

ctiv

ities

Incl

udes

the

cost

of p

rofe

ssio

nal m

ilita

ry e

duca

tion;

and

aca

dem

ic e

duca

tion

prog

ram

s.O

SD

OS

Cos

t Est

imat

ing

Gui

de (

Oct

. 200

7)

Lice

nses

Aut

horiz

atio

nO

SD

OS

Cos

t Est

imat

ing

Gui

de (

Oct

. 200

7)

Tec

hnic

al R

efre

shT

he p

erio

dic

repl

acem

ent o

f Com

mer

cial

Off-

The

-She

lf (C

OT

S)

com

pone

nts;

e.g

. pro

cess

ors,

dis

play

s, c

ompu

ter

oper

atin

g sy

stem

s,

com

mer

cial

ly a

vaila

ble

softw

are

(CA

S)

with

in la

rger

DoD

sys

tem

s to

ass

ure

cont

inue

d su

ppor

tabi

lity

of th

at s

yste

m th

roug

h an

inde

finite

se

rvic

e lif

e.

Dat

a w

areh

ouse

Incl

udes

the

cost

s as

soci

ated

with

a c

ompu

ter

data

base

that

col

lect

s, in

tegr

ates

, and

sto

res

an o

rgan

izat

ion’

s co

mpu

ter

data

with

the

aim

of

mai

ntai

ning

and

pro

vidi

ng a

ccur

ate

and

timel

y m

anag

emen

t inf

orm

atio

n an

d su

ppor

ting

data

ana

lysi

s. T

he d

ata

may

be

dist

ribut

ed;

that

is,

loca

ted

at m

ultip

le o

rgan

izat

iona

l and

loca

tions

.

Pac

kagi

ng, H

andl

ing,

Sto

rage

, and

T

rans

port

atio

n:

Pac

kagi

ng, h

andl

ing,

sto

rage

, and

tran

spor

tatio

n (P

HS

&T

) en

com

pass

es th

e re

quire

men

ts, r

esou

rces

, pro

cess

es, p

roce

dure

s, d

esig

n

cons

ider

atio

ns, a

nd m

etho

ds to

ens

ure

that

all

syst

em e

quip

men

t and

sup

port

item

s ar

e pr

eser

ved,

pac

kage

d, h

andl

ed, s

tore

d, a

nd

tran

spor

ted

prop

erly

. T

his

elem

ent i

nclu

des

all s

peci

al p

rovi

sion

s, c

onta

iner

s (r

eusa

ble

and

disp

osab

le),

and

sup

plie

s ne

cess

ary

to s

uppo

rt

pack

agin

g, p

rese

rvat

ion,

sto

rage

, han

dlin

g, a

nd/o

r tr

ansp

orta

tion

of p

rime

mis

sion

equ

ipm

ent,

test

and

sup

port

equ

ipm

ent,

spar

es

and

repa

ir pa

rts,

per

sonn

el, t

echn

ical

dat

a, a

nd m

obile

faci

litie

s. I

n es

senc

e, th

is e

lem

ent b

asic

ally

cov

ers

the

initi

al d

istr

ibut

ion

of p

rodu

cts

and

the

tran

spor

tatio

n of

per

sonn

el a

nd m

ater

ials

for

mai

nten

ance

pur

pose

s.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Con

tinui

ng S

yste

m Im

prov

emen

tsT

his

port

ion

of th

e co

st e

lem

ent s

truc

ture

incl

udes

the

cost

s of

har

dwar

e an

d so

ftwar

e up

date

s th

at o

ccur

afte

r de

ploy

men

t of a

sys

tem

that

im

prov

e a

syst

em's

saf

ety,

rel

iabi

lity,

mai

ntai

nabi

lity,

or

perf

orm

ance

cha

ract

eris

tics

to e

nabl

e th

e sy

stem

to m

eet i

ts b

asic

ope

ratio

nal

requ

irem

ents

thro

ugho

ut it

s lif

e. T

hese

cos

ts in

clud

e go

vern

men

t and

con

trac

t lab

or, m

ater

ials

, and

ove

rhea

d co

sts.

Cos

ts s

houl

d be

se

para

ted

into

gov

ernm

ent a

nd c

ontr

acto

r co

sts

with

in e

ach

cost

ele

men

t, if

poss

ible

. T

he c

ontin

uing

sys

tem

impr

ovem

ents

por

tion

of a

n O

&S

est

imat

e do

es n

ot in

clud

e al

l cha

nges

to a

sys

tem

dev

elop

ed s

ubse

quen

t to

the

initi

al d

eliv

ered

con

figur

atio

n. S

yste

m im

pro

vem

ents

id

entif

ied

as p

art o

f an

incr

emen

tal e

volu

tiona

ry a

cqui

sitio

n st

rate

gy o

r pr

e-pl

anne

d pr

oduc

t im

prov

emen

t pro

gram

that

are

incl

uded

in th

e ac

quis

ition

cos

t est

imat

e ar

e no

t inc

lude

d in

this

por

tion

of a

n O

&S

cos

t est

imat

e. A

ny im

prov

emen

t of s

uffic

ient

dol

lar

valu

e th

at it

wou

ld

qual

ify a

s a

dist

inct

Maj

or D

efen

se A

cqui

sitio

n P

rogr

ams

(MD

AP

) in

its

own

right

nor

mal

ly w

ould

not

be

incl

uded

in th

is p

ortio

n o

f the

O&

S

cost

est

imat

e.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Har

dwar

e M

oder

niza

tions

The

se c

osts

incl

ude

cost

s as

soci

ated

with

mod

ifyin

g th

e de

fens

e sy

stem

, sup

port

equ

ipm

ent,

and

trai

ning

dev

ices

. All

cost

s as

soci

ated

with

de

velo

ping

, pro

duci

ng, a

nd in

stal

ling

the

mod

ifica

tions

are

incl

uded

. Whe

n ha

rdw

are

mod

ifica

tions

req

uire

cha

nges

in s

yste

m o

r su

ppor

t so

ftwar

e or

tech

nica

l doc

umen

tatio

n, th

ese

cost

s sh

ould

be

incl

uded

with

har

dwar

e m

odifi

catio

ns c

osts

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sof

twar

e M

aint

enan

ce a

nd M

odifi

catio

nsT

he la

bor,

mat

eria

l, an

d ov

erhe

ad c

osts

incu

rred

afte

r de

ploy

men

t in

supp

ortin

g th

e up

date

, mai

nten

ance

and

mod

ifica

tion,

inte

grat

ion,

and

co

nfig

urat

ion

man

agem

ent o

f sof

twar

e. D

epot

-leve

l mai

nten

ance

act

iviti

es, g

over

nmen

t sof

twar

e ce

nter

s, la

bora

torie

s, o

r co

ntra

ctor

s m

ay

incu

r th

ese

cost

s. In

clud

es a

ny li

cens

ing

cost

s fo

r so

ftwar

e no

t ow

ned

by th

e op

erat

ing

units

. Inc

lude

s op

erat

iona

l, m

aint

enan

ce, s

uppo

rt a

nd

diag

nost

ic s

oftw

are

prog

ram

s fo

r th

e pr

imar

y sy

stem

, sup

port

equ

ipm

ent,

and

trai

ning

equ

ipm

ent.

The

res

pect

ive

cost

s of

ope

ratin

g an

d m

aint

aini

ng th

e as

soci

ated

com

pute

r an

d pe

riphe

ral e

quip

men

t in

the

softw

are

supp

ort a

ctiv

ity a

nd th

e co

st to

con

duct

all

test

ing

of th

e so

ftwar

e sh

ould

als

o be

incl

uded

.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Dis

po

sal

Con

sist

s of

cos

ts a

ssoc

iate

d w

ith d

emili

tariz

atio

n an

d di

spos

al o

f a m

ilita

ry s

yste

m a

t the

end

of i

ts u

sefu

l life

. The

se c

osts

in s

ome

case

s re

pres

ent o

nly

a sm

all f

ract

ion

of a

sys

tem

's li

fe-c

ycle

cos

t and

may

not

alw

ays

be c

onsi

dere

d w

hen

prep

arin

g lif

e-cy

cle

cost

est

imat

es.

How

ever

, it i

s im

port

ant t

o co

nsid

er d

emili

tariz

atio

n an

d di

spos

al e

arly

in th

e lif

e-cy

cle

of a

sys

tem

bec

ause

thes

e co

sts

can

be s

igni

fican

t, de

pend

ing

on th

e ch

arac

teris

tics

of th

e sy

stem

. C

osts

ass

ocia

ted

with

dem

ilita

rizat

ion

and

disp

osal

may

incl

ude

disa

ssem

bly,

mat

eria

ls

proc

essi

ng, d

econ

tam

inat

ion,

har

dwar

e, c

olle

ctio

n/st

orag

e/di

spos

al o

f haz

ardo

us m

ater

ials

and

/or

was

te, s

afet

y pr

ecau

tions

, and

tr

ansp

orta

tion

of th

e sy

stem

to a

nd fr

om th

e di

spos

al s

ite. S

yste

ms

may

be

give

n cr

edit

in th

e co

st e

stim

ate

for

reso

urce

rec

over

y an

d re

cycl

ing

cons

ider

atio

ns.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Sys

tem

Rem

oval

An

elem

ent o

f a m

aint

enan

ce e

vent

. O

ne o

f mor

e ta

sks

nece

ssar

y to

ret

ain

an it

em in

or

rest

ore

it to

a s

peci

fied

cond

ition

.

Env

ironm

enta

l Pro

tect

ion

The

pra

ctic

e of

pro

tect

ing

the

envi

ronm

ent,

on in

divi

dual

, org

aniz

atio

nal o

r go

vern

men

tal l

evel

, for

the

bene

fit o

f the

nat

ural

env

ironm

ent a

nd

(or)

hum

ans.

Pag

e 6

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Po

ten

tial

Ben

efit

Are

as o

r M

easu

res

of

Eff

ecti

ven

ess

Maintenan

ceC

BM

+ te

chno

logi

es h

ave

the

pote

ntia

l to

impr

ove

mai

nten

ance

cap

abili

ties

and

busi

ness

pro

cess

es a

nd e

nhan

ce r

elia

bilit

y an

alys

is e

ffor

ts;

invo

lves

the

inte

grat

ion

of s

uppo

rt e

lem

ents

to e

nabl

e en

hanc

ed m

aint

enan

ce-c

entr

ic lo

gist

ics

syst

em r

espo

nse;

and

faci

litat

es m

ore

accu

rate

pr

edic

tions

of i

mpe

ndin

g fa

ilure

s (b

ased

on

cond

ition

dat

a), r

esul

ting

in d

ram

atic

sav

ings

.

OS

D C

BM

+ G

uide

book

Pla

tform

Mai

nten

ance

func

tions

per

form

ed a

t the

uni

t (e.

g., g

roun

d ve

hicl

e, a

ircra

ft, s

hip,

sup

port

sys

tem

, sub

-sys

tem

or

com

pon

ent)

leve

l. A

t the

ta

ctic

al le

vel,

CB

M+

may

mea

n ne

w to

ols,

test

equ

ipm

ent,

and

embe

dded

onb

oard

dia

gnos

tics.

The

se to

ols

take

adv

anta

ge o

f cur

ren

t and

em

ergi

ng c

omm

erci

al a

nd d

iagn

ostic

tech

nolo

gies

that

tran

slat

e sy

stem

con

ditio

n da

ta (

such

as

tem

pera

ture

, vib

ratio

n, c

ycle

-tim

e) in

co

mbi

natio

n w

ith e

nviro

nmen

tal f

acto

rs (

like

dese

rt, a

rctic

, and

hig

h hu

mid

ity)

into

pro

activ

e m

aint

enan

ce a

ctio

ns th

at a

re p

erfo

rmed

onl

y w

hen

ther

e is

evi

denc

e of

act

ual n

eed.

With

CB

M+

, mai

ntai

ners

can

con

vert

wea

pon

syst

em o

r eq

uipm

ent c

ondi

tion

data

into

pro

activ

e m

aint

enan

ce a

ctio

ns. S

ched

uled

insp

ectio

ns a

re s

uppl

emen

ted

or r

epla

ced

beca

use

mai

ntai

ners

will

hav

e an

alyt

ical

.

OS

D C

BM

+ G

uide

book

Life

Cyc

le M

anag

emen

tM

aint

enan

ce fu

nctio

ns p

erfo

rmed

by

the

life

cycl

e m

anag

er b

ased

on

CB

M+

info

rmat

ion

and

data

(un

it an

d ab

ove

his

tory

, tre

ndin

g,

diag

nost

ics,

pro

gnos

tics

and

logi

stic

sup

port

) to

man

age

and

supp

ort t

he h

eadq

uart

ers

and

oper

atio

nal c

omm

and

infr

astr

uctu

res.

Im

plem

entin

g C

BM

+ te

chno

logi

es n

ot o

nly

impr

oves

the

abili

ty to

pre

dict

failu

res,

mai

nten

ance

pla

nnin

g bu

t the

ben

efits

car

ry o

ver

into

re

late

d ar

eas,

suc

h as

sup

ply

supp

ort,

use

of fa

cilit

ies

and

test

equ

ipm

ent,

skill

s m

anag

emen

t, an

d ot

her

logi

stic

s su

ppor

t ele

men

ts. W

hile

so

me

CB

M+

feat

ures

are

inst

alle

d at

indi

vidu

al p

latfo

rm le

vel,

the

bene

fits

of C

BM

+ a

re m

ost e

ffect

ivel

y ac

hiev

ed w

hen

an e

ntir

e fle

et is

in

corp

orat

ed a

nd th

e in

form

atio

n is

leve

rage

d. A

t the

str

ateg

ic le

vel,

CB

M+

iden

tifie

s m

aint

enan

ce a

ctio

ns b

ased

on

a ne

ar-r

eal-

time

asse

ssm

ent o

f equ

ipm

ent s

tatu

s fr

om d

iagn

ostic

sen

sors

and

equ

ipm

ent.

Dat

a co

llect

ed fr

om e

mbe

dded

sen

sors

, suc

h as

hea

lth a

nd u

sage

m

onito

ring

syst

ems

are

then

tran

slat

ed in

to p

redi

ctiv

e tr

ends

or

met

rics

that

ant

icip

ate

whe

n co

mpo

nent

failu

res

will

occ

ur a

nd id

entif

ies

com

pone

nts

that

may

req

uire

red

esig

n or

rep

lace

men

t to

redu

ce h

igh-

failu

re r

ates

. Com

mon

use

of i

tem

s an

d da

ta a

mon

g th

e S

ervi

ces

on li

k esy

stem

s w

ill g

reat

ly r

educ

e lo

gist

ics

foot

prin

ts a

nd c

osts

.

OS

D C

BM

+ G

uide

book

Ope

ratio

nal/U

nit/S

quad

ron/

B

atta

lion/

Fle

etA

hom

ogen

eous

mili

tary

org

aniz

atio

n. T

o th

e co

mm

ande

r at

the

oper

atio

nal l

evel

, CB

M+ b

rings

the

abili

ty to

mee

t mis

sion

req

uire

men

ts a

nd

incr

ease

wea

pon

syst

em a

vaila

bilit

y. C

BM

+ p

rovi

des

com

man

ders

, mis

sion

pla

nner

s, a

nd lo

gist

ics

prov

ider

s w

ith in

form

atio

n th

at e

nabl

es

bette

r m

aint

enan

ce d

ecis

ion

mak

ing

and

mis

sion

ass

ignm

ent.

CB

M+

sup

port

s F

ocus

ed L

ogis

tics

by e

nhan

cing

com

man

d si

tuat

iona

l aw

aren

ess

at th

e w

eapo

n sy

stem

leve

l.

System Reliability

Rel

iabi

lity

is th

e pr

obab

ility

of a

n ite

m to

per

form

a r

equi

red

func

tion

unde

r st

ated

con

ditio

ns fo

r a

spec

ified

per

iod

of ti

me

. Sys

tem

rel

iabi

lity

is

defin

ed a

s th

e ab

ility

of a

sys

tem

to p

erfo

rm a

s de

sign

ed in

an

oper

atio

nal e

nviro

nmen

t ove

r a

pres

crib

ed p

erio

d w

ithou

t fai

lure

. DoD

’s s

yste

m

relia

bilit

y ob

ject

ive

is to

min

imiz

e th

e ris

k of

failu

re w

ithin

the

defin

ed a

vaila

bilit

y, c

ost,

sche

dule

, wei

ght,

pow

er, a

nd v

olu

me

cons

trai

nts.

DoD

RA

M G

uide

Number of no evidence of failu

res (NEO

F)F

alse

failu

re. N

EO

F's

can

be

caus

ed b

y ch

ange

s in

the

oper

atin

g en

viro

nmen

t, er

rors

in d

iagn

ostic

pro

cedu

res,

cum

bers

ome

test

equ

ipm

ent,

or th

e ba

sic

desi

gn o

f the

sys

tem

.C

BM

+ 1

01 B

riefin

g -

OS

D C

BM

+ A

dvis

ory

Gro

up

Accuracy of failu

re prediction

CB

M+ u

ses

mod

ern

mai

nten

ance

tool

s, te

chno

logi

es, a

nd p

roce

sses

to d

etec

t the

ear

ly in

dica

tions

of a

faul

t or

impe

ndin

g fa

ilure

bas

ed o

n re

al-t

ime

cond

ition

dat

a.

OS

D C

BM

+ G

uide

book

Equipment mean

downtime (logistics responsiveness)

CB

M+ u

ses

mod

ern

mai

nten

ance

tool

s, te

chno

logi

es, a

nd p

roce

sses

to d

etec

t the

ear

ly in

dica

tions

of a

faul

t or

impe

ndin

g fa

ilure

to a

llow

tim

e fo

r m

aint

enan

ce a

nd s

uppl

y ch

anne

ls to

rea

ct a

nd m

inim

ize

the

impa

ct o

n sy

stem

ope

ratio

nal r

eadi

ness

and

life

-cyc

le c

osts

.

DU

SD

(Lo

gist

ics

and

Mat

eria

l Rea

dine

ss)

Mem

oran

dum

- L

ife C

ycle

S

usta

inm

ent O

utco

me

Met

rics,

dat

ed 1

0 M

ar 2

007

Effectiveness of Platform

/system condition

assessment

A m

easu

re o

f the

ove

rall

effe

ctiv

enes

s of

the

CB

M+ c

apab

ility

(E

HM

or

VH

M)

as

it re

late

s to

the

plat

form

or

syst

em d

efin

ed fo

r th

e sy

stem

be

ing

eval

uate

d. S

uch

as n

umbe

r of

fals

e

Mission reliability

The

pro

babi

lity

that

an

item

can

per

form

its

stat

ed fu

nctio

n fo

r a

spec

ified

inte

rval

und

er s

tate

d co

nditi

ons.

DU

SD

(Lo

gist

ics

and

Mat

eria

l Rea

dine

ss)

Mem

oran

dum

- L

ife C

ycle

S

usta

inm

ent O

utco

me

Met

rics,

dat

ed 1

0 M

ar 2

007;

US

D (

AT

&L)

M

emor

andu

m -

Tot

al L

ife C

ycle

Sys

tem

s M

anag

emen

t (T

LCS

M)

Met

rics

date

d 22

Nov

200

5

Mis

sion

abo

rt r

ate

Abo

rt r

ate

is th

e nu

mbe

r of

abo

rts

divi

ded

by th

e nu

mbe

r of

sor

ties.

Com

bat p

ower

/pla

tform

/sys

tem

av

aila

bilit

yS

ee 1

08 (

Ava

ilabi

lity)

Safety

The

con

ditio

n of

bei

ng p

rote

cted

aga

inst

phy

sica

l, oc

cupa

tiona

l, an

d ot

her

type

s or

con

sequ

ence

s of

dam

age,

failu

re, e

rror

, acc

iden

ts, h

arm

, or

any

oth

er e

vent

whi

ch c

ould

be

cons

ider

ed n

on-d

esira

ble.

OS

D C

BM

+ G

uide

book

Num

ber

of a

void

ed m

isha

ps o

r m

aint

enan

ce r

isks

Num

ber

of m

isha

ps o

r m

aint

enan

ce r

isks

that

can

be

attr

ibut

ed to

rep

lace

men

t of c

ompo

nent

(s)/

syst

ems

that

pre

vent

ed a

failu

re f

rom

oc

curr

ing.

System design

improvements

Tho

se a

ctio

ns ta

ken

to e

nhan

ce a

sys

tem

's p

erfo

rman

ce, f

unct

ion,

saf

ety,

rel

iabi

lity,

mai

ntai

nabi

lity,

etc

.O

SD

OS

Cos

t Est

imat

ing

Gui

de (

Oct

. 200

7); D

OD

I 500

0.2

Pag

e 7

CB

M+

BC

A IN

FO

RM

AT

ION

PA

PE

R -

DE

FIN

ITIO

NS

/DE

SC

RIP

TIO

NS

Oct

ob

er 2

010

Ter

mD

efin

itio

n/D

escr

ipti

on

R

efer

ence

Po

ten

tial

Ben

efit

Are

as o

r M

easu

res

of

Eff

ecti

ven

ess

Maintenan

ce facilities usage

(all levels)

App

licat

ion

of C

BM

+ te

chno

logi

es c

ould

res

ult i

n th

e re

duct

ion

of th

e m

aint

enan

ce fa

cilit

ies

at a

ny le

vel o

f mai

nten

ance

. For

the

CB

M+ B

CA

de

fine

faci

litie

s in

volv

ed a

nd th

e po

tent

ial i

mpa

ct w

ith th

e pr

opos

ed C

BM

+ c

hang

e.

OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Troubleshooting an

d repair action

An

elem

ent o

f a m

aint

enan

ce e

vent

. O

ne o

f mor

e ta

sks

nece

ssar

y to

ret

ain

an it

em in

or

rest

ore

it to

a s

peci

fied

cond

ition

.O

SD

OS

Cos

t Est

imat

ing

Gui

de (

Oct

. 200

7)

Acc

urat

e an

d tim

elin

ess

Dat

a A

ccur

acy

- D

egre

e to

whi

ch th

e da

ta r

epre

sent

s ac

tual

(tr

ue)

valu

e. D

ata

Tim

elin

ess

- D

egre

e to

whi

ch th

e da

ta is

ava

ilabl

e w

hen

need

ed o

r re

quire

d.O

SD

CB

M+

Gui

debo

ok

Mean

down tim

eM

ean

dow

n tim

e (M

DT

) is

the

aver

age

tota

l tim

e re

quire

d to

res

tore

an

asse

t to

its fu

ll op

erat

iona

l cap

abili

ties.

MD

T in

clud

es t

he ti

me

from

re

port

ing

of a

n as

set b

eing

dow

n to

the

asse

t bei

ng g

iven

bac

k to

ope

ratio

ns o

r pr

oduc

tion

to o

pera

te.

DU

SD

(Lo

gist

ics

and

Mat

eria

l Rea

dine

ss)

Mem

oran

dum

- L

ife C

ycle

S

usta

inm

ent O

utco

me

Met

rics,

dat

ed 1

0 M

ar 2

007

Logistics decision process (es)

Logi

stic

s pr

oces

s (e

s) th

at a

re p

oten

tially

impa

cted

by

the

prop

osed

CB

M+ c

apab

ility

. Inc

lude

s an

y su

pply

cha

in, a

sset

and

inve

ntor

y co

ntro

l, sp

are

part

s m

anag

emen

t , w

areh

ouse

man

agem

ent a

nd lo

gist

ics

info

rmat

ion

man

agem

ent p

roce

sses

. Con

side

r sp

ecifi

c m

etric

s or

MO

Es

cons

ider

ed to

be

prob

lem

are

as o

r de

sire

d en

d st

ate

cond

ition

.

US

D (

AT

&L)

Mem

oran

dum

-T

otal

Life

Cyc

le S

yste

ms

Man

agem

ent

(TLC

SM

) M

etric

s da

ted

22 N

ov 2

005;

DU

SD

(Lo

gist

ics

and

Mat

eria

l R

eadi

ness

) M

emor

andu

m -

Life

Cyc

le S

usta

inm

ent O

utco

me

Met

rics,

dat

ed 1

0 M

ar 2

007

Sup

ply

chai

n im

pact

sP

oten

tial i

mpa

cts

that

the

prop

osed

CB

M+

capa

bilit

y w

ill h

ave

on s

uppl

y ch

ain

man

agem

ent s

uch

as a

sset

vis

ibili

ty, n

umbe

r of

con

trac

ts,

back

orde

r ag

e, b

acko

rder

rat

es, r

equi

sitio

n re

spon

se ti

me

, etc

.. A

sset

acc

ount

abili

ty a

nd in

vent

ory

cont

rol

Iden

tify,

trac

k an

d m

anag

e in

vent

ory

of w

eapo

n sy

stem

com

pone

nts

Spa

re p

arts

man

agem

ent

Iden

tify,

trac

k an

d m

anag

e sp

are

part

s to

sup

port

ope

ratio

nal r

equi

rem

ents

War

ehou

se m

anag

emen

t M

anag

emen

t inf

orm

atio

n sy

stem

(S

) re

quire

d to

iden

tify,

trac

k an

d m

anag

emen

t of s

tore

d an

d m

aint

aine

d w

eapo

ns s

yste

m/c

ompo

nent

s

Logistics Response Tim

eT

he p

erio

d of

tim

e fr

om lo

gist

ics

dem

and

sign

al s

ent t

o sa

tisfa

ctio

n of

that

logi

stic

s de

man

d. ‘L

ogis

tics

dem

and’

ref

ers

to s

yste

ms,

co

mpo

nent

s, o

r re

sour

ces,

incl

udin

g la

bor

requ

ired

for

wea

pon

syst

em lo

gist

ics

supp

ort.

Log

istic

s re

spon

se ti

me

as m

easu

red

by th

e ap

prop

riate

logi

stic

s pr

oces

s su

ppor

ting

the

exis

ting

syst

em. C

onsi

der

spec

ific

met

rics

or M

OE

s co

nsid

ered

to b

e pr

oble

m a

reas

or

desi

red

end

stat

e co

nditi

on, s

uch

as c

lass

IX r

epai

r pa

rts,

req

uisi

tion

date

, rec

eipt

dat

e, to

tal r

equi

sitio

ns, e

tc…

.

US

MC

Per

form

ance

Bas

ed L

ogis

tics

(PB

L) G

uide

book

; US

D (

AT

&L)

M

emor

andu

m -

Tot

al L

ife C

ycle

Sys

tem

s M

anag

emen

t (T

LCS

M)

Met

rics

date

d 22

Nov

200

5

Total ownership cost (TO

C)

Tot

al o

wne

rshi

p co

st in

clud

es th

e el

emen

ts o

f a p

rogr

am's

life

-cyc

le c

ost,

as w

ell a

s ot

her

rela

ted

infr

astr

uctu

re o

r bu

sine

ss p

roce

sses

cos

ts

not n

eces

saril

y at

trib

uted

to th

e pr

ogra

m in

the

cont

ext o

f the

def

ense

acq

uisi

tion

syst

em.

Def

ense

Acq

uisi

tion

Gui

debo

ok; D

US

D (

Logi

stic

s an

d M

ater

ial

Rea

dine

ss)

Mem

oran

dum

- L

ife C

ycle

Sus

tain

men

t Out

com

e M

etric

s, d

ated

10

Mar

200

7

$ pe

r un

it us

age

Cos

t per

uni

t U

SD

(A

T&

L) M

emor

andu

m -

Tot

al L

ife C

ycle

Sys

tem

s M

anag

emen

t (T

LCS

M)

Met

rics

date

d 22

Nov

200

5A

vaila

bilit

yA

vaila

bilit

y is

a m

easu

re o

f the

deg

ree

to w

hich

an

item

is in

an

oper

able

sta

te a

nd c

an b

e co

mm

itted

at t

he s

tart

of a

mis

sion

whe

n th

e m

issi

on is

cal

led

for

at a

n un

know

n (r

ando

m)

poin

t in

time.

DoD

RA

M G

uide

; US

D (

AT

&L)

Mem

oran

dum

-T

otal

Life

Cyc

le

Sys

tem

s M

anag

emen

t (T

LCS

M)

Met

rics

date

d 22

Nov

200

5

Logi

stic

s F

ootp

rint

The

am

ount

of p

erso

nnel

, spa

res,

res

ourc

es, a

nd c

apab

ilitie

s sp

ecifi

cally

des

igne

d an

d/or

des

igna

ted

in s

upp

ort a

nd p

hysi

cally

pre

sent

and

oc

cupy

ing

spac

e at

a d

eplo

yed

loca

tion.

The

Gov

ernm

ent/c

ontr

acto

r si

ze o

r ‘p

rese

nce’

of l

ogis

tics

supp

ort r

equi

red

to d

eplo

y, s

usta

in, a

nd

mov

e a

wea

pon

syst

em. M

easu

rabl

e el

emen

tsin

clud

e in

vent

ory/

equi

pmen

t, pe

rson

nel,

faci

litie

s, tr

ansp

orta

tion

asse

ts, a

nd r

eal e

stat

e. T

he lo

gist

ics

foot

prin

t sup

port

ing

the

exis

ting

syst

em

and

any

spec

ific

met

rics

or M

OE

s co

nsid

ered

to b

e pr

oble

m a

reas

or

desi

red

end

stat

e co

nditi

on. C

onsi

der

area

s su

ch a

s co

nsum

able

s,

ener

gy u

sage

, sup

port

equ

ipm

ent,

spar

es, e

tc…

US

D (

AT

&L)

Mem

oran

dum

-T

otal

Life

Cyc

le S

yste

ms

Man

agem

ent

(TLC

SM

) M

etric

s da

ted

22 N

ov 2

005;

US

MC

Per

form

ance

Bas

ed

Logi

stic

s (P

BL)

Gui

debo

ok

Mai

nten

ance

The

act

of m

aint

aini

ng o

r st

ate

of b

eing

mai

ntai

ned.

O

SD

CB

M+ G

uide

book

; OS

D O

S C

ost E

stim

atin

g G

uide

(O

ct. 2

007)

Pag

e 8


24

Appendix D – CBM+ Cost Elements Structure

Life Cycle Phases New System 0-10 Yrs 10-25 Yrs 25+ Yr

Development Design

Development (include both hardware & software)

Prototype

Testing & Validation

Data Management

CBM+ Services Applications

Investment System acquisition

Facilities and Infrastructure

Supply support

Test equipment

Prognostics/diagnostics services

Data Warehouse

Training

Operation & SustainmentUnit Level Manpower

Operations

Unit-Level Maintenance

Other Unit-Level

Unit Operations

Operating Material

Support Services

Temporary Duty

Data warehouse - data/software management

Facilities

Services (24/7)

Maintenance (all elements;schedule and unscheduled)

Organizational

Intermediate

Depot

Energy (fuel, petrolium, oil,electricity, etc.. )

Sustaining Support

Systems Specific Training

Support Equipment Replacement

Sustaining Engineering and Program Management

Other Sustaining Support

Indirect Support

Installation

Personnel

Personnel Admin - Acquisition and Overhead accounts

Personnel Benefits

Medical

General Training and Education

Basic & Initial Skill Training

Educational Activities

Licenses

Technical Refresh

Data warehouse

Packaging, Handling, Storage, and Transportation:

Training

Continuing System Improvements

Hardware Modernizations

Software Maintenance and Modifications

DisposalSystem Removal

Environmental Protection


25

Appendix E – CBM+ Measures of Effectiveness

Potential Benefit Areas or Measures of Effectiveness / CBM+ Effects

Metric 1. Failure Prediction

2. Holistic View of

Equipment Condition

3. Accuracy of Failure Prediction

4. Improve Reliability

5. Reduce MDT

7. Optimize Performance

Overall Benefit + or -

Maintenance ‐

Platform

MTBF, Mean time

Between Removal

(MTBR)

Mean time

Between Critical

Failure (MTBCF),

RM

x x x

Life Cycle ManagementTOC ($), Spares

requirements,

ECP requests,

x x

Operational/Squadron/Batallion/FleetTOC($), Ao, MC,

FMCx x

System Reliability RM x x

Number of no evidence of failures (NEOF) # NEOF x x

Accuracy of failure prediction Error Rate, RM x x

Effectiveness of Platform/system condition assessme RM, False alerts x

Mission reliability Ao, RM, MTBCF

Mission abort rate Ao, AM, RM x x

Combat power/platform/system availabilityQualitative, RM, Ao,

FMC, MC

x x x

Safety

Number of avoided mishaps or maintenance ris # x x

System design improvements# ECPs,

Qualitativex

Maintenance facilities usage (all levels) Cost($) x

Troubleshooting and repair action MTTR x x

Accuracy and timeliness Repair cycle time x x

Mean down time MDT, Mnhrs x x

Logistics decision process (es) Various x

Supply chain impacts

$, Asset Visibility,

Backorder Age,

Backorder Rates,

Requisition

Response Rate,

NMCS, # Contracts

x x

Asset accountability and inventory control

Asset Visibility,

Backorder Age,

Backorder Rates,

Requisition

Response Time,

Parts Turnaround

Time, Fill Rate

x x

Spare parts management

$, Asset Visibility,

Backorder Age,

Backorder Rates,

Requisition

Response Time,

Parts Turnaround

Time, Fill Rate

x x

Warehouse management Cost($) (Leased,

Purchased)x x

Logistics Footprint $, Spares x

Logistics Response Time

Class IX Repair

Parts, Requisition

Date, Total

Requisitions

x

Total ownership cost (TOC) TOC ($) x x


26

Appendix F – References

CBM+ BCA Study References

A. Condition Based Maintenance Plus DoD Guidebook ‐ May 2008

B. NDIA Final Report EHM Committee ‐ EHM Technology Transition Study October 2009

C. USD ‐ ATL Letter ‐ Performance Based Logistics (PBL) Business Case Analysis (BCA). Product Support Strategy BCA Guiding Principles ‐ 23 Jan 2004

D. USD Letter ‐ Life Cycle Sustainment Outcome Metrics ‐ 10 Mar 2007

E. The Analysis of Return on Investment for PHM Applied to Electronic Systems ‐ October 2008

F. OSD Cost Analysis Improvement Group ‐ Operating and Support Cost‐Estimating Guide ‐ October 2007

G. Army Aviation Condition Based Maintenance Plus (CBM+) Program ‐ December 2009

Additional References

Air Force Manual 65‐510, Business Case Analysis Procedures ‐ 22 September 2008

A Decision Support Model for Determining the Applicability of Prognostic Health Management (PHM) Approaches to Electronics Systems ‐ January 2005

Air Force Material Command PBL BCA Checklist ‐ 31 May 2007

Business Case Development Guide; EI Toolkit Guide Version 2.0 ‐ November 2003

Considerations for a Business Case Analysis for Serialized Item Management (SIM)

DAU Business Case Project Template Document XXX, Version 1.0

DON Memorandum for Distribution‐ 6 Nov 2007, DON Guide for Developing Performance Based Logistics Business Case Analyses (P07‐006)

DoD 5000.04–M–1, Cost and Software Data Reporting (CSDR) Manual ‐ 18 April 2007

DoD Instruction 7041.3 dated 7 November 1995 ‐ Economic Analysis for Decision Making

DoD Reliability, Maintainability, and Cost Rationale Report Manual ‐ 22 June 2009

DoDI 4151.22, Condition Based Maintenance Plus (CBM+) for Material Maintenance dated December 2, 2007

FY 2000 DoD Logistics Strategic Plan ‐ Aug 1999

MIL‐STD‐881A

OMB Circular A‐94 "Guidelines and Discount Rates for Benefit‐Cost Analysis of Federal Programs"

OMB Circular No. A‐130

PM LAV Embedded Platform Logistics System (EPLS) BCA ‐ Feb 2010

Recommended Performance Measurement Scorecard for Supply Chain Management ‐ LMI ‐ June 1999

Risk Management Guide for DoD Acquisition, Sixth Edition, Version 1.0, August 2006

Standard Operating Procedure for Cost Benefit Analysis Review Board ‐ 13 May 2010

U.S. Army Cost Benefit Analysis Guide Version 1.0 dated 12 January 2010 ‐ Assistant Secretary of the Army Financial Management and Comptroller Memorandum ‐ 1 Feb 2010

USAF High Velocity Maintenance brief ‐ Jun 2010

USAF Live‐Virtual‐Constructive Brief ‐ 20 Feb 2009

USD ‐ ATL Letter ‐ Performance Based Logistics (PBL) Business Case Analysis (BCA). PBL BCA Criteria ‐ 20 Mar 2004

USD ‐ ATL Letter ‐ Performance Based Logistics (PBL): Purchasing using Performance Based Criteria ‐ 16 Aug 2004

USD Memorandum ‐ Total Life Cycle Systems Management (TLCSM) Metrics ‐ 22 Nov 2005

USMC Performance Based Logistics Guide V 1.04 ‐ 24 Jun 2010


27

Appendix G – CBM+ BCA Reference Extracts

CBM+ BCA Extracts

1. Cost Benefit Analysis for the Army Aviation Condition Based Maintenance Plus (CBM+) Program ‐ December 2009

a. The most compelling and supportable benefits described in this Cost Benefit Analysis (CBA) are those associated with aviator safety and aviation combat power. Evidence from actual experience supports increased safety (known to have avoided Class A accidents), and the potential avoidance of numerous mishaps (9‐12% reduction). Our CBM+ program has coincided with improved readiness rates (3.7‐10.3% higher Mission Capability (MC) than non‐equipped aircraft), the ability to generate additional flying hours within the CBM‐equipped fleet, and lower mission abort rates (7‐31% depending on platform variant). The ability to use CBM equipment to record flight hours can reduce scheduled maintenance burden by 12‐22% with corresponding savings from contractor labor and maintenance test flight hours. Finally, Army Aviation CBM+ program is responsible for hundreds of small, nearly unquantifiable gains in terms of troubleshooting time, precautionary landings that did not happen, avoided unnecessary maintenance procedures, and more. All of these together represent substantial and real aid to the Aviation Soldier. (Executive Summary, page 6 of 79)

b. The Army Material Command (AMCOM) CBM+ program requires a substantial investment in terms of hardware and analytical manpower. Simply installing CBM equipment on aircraft will not instantly result in benefits and savings. It takes several years of data collection and analysis to turn the data into information and begin changing long‐established maintenance procedures that take advantage of the technology. Only in the long process to change those procedures can CBM+ demonstrate its enduring effect. However, economic modeling, combined with evidence from analysis of fleet‐wide readiness and maintenance data, reveals that CBM+ will likely have long and meaningful impact on Army Aviation maintenance and the combat power of our rotary‐wing fleet. (Executive Summary, page 7 of 79)

c. For this CBA, the following MOEs will be evaluated to facilitate the comparative evaluation of alternatives:

i. Non‐Monetary MOEs

1. Safety : % Avoidable Mishaps

2. Combat Power: % MC, % Non‐Mission Capable Maintenance (NMCM), Mission Aborts/Flight Hour

3. Maintenance Man‐hours Avoided (annually and per flight hour)

4. Maintenance Test Flights (MTFs) Hours Avoided annually

5. Number of Mandatory Time Between Overhauls (TBOs)/ Part Retirements Eliminated

6. % No Evidence of Failure (NEOF) Improvement


28

ii. Monetary MOEs

1. Reduction in Maintenance Man–Hours Costs for Inspections/Vibration Testing/Rotor track and Balance

2. Reduction in Maintenance Test Flight Flying Hour Costs

3. Reduction in Parts Replace On Condition vs. TBOs

4. Reduction in Maintenance Man‐Hours for Parts Replaced On Condition With CBM+ vs. TBOs

5. Reduction in Maintenance Man‐Hours for Manual Logging of Flight Time vs. Digital Source Collectors (DSC) Automated Flight Time Generation

6. Reductions in parts demand resulting from changes caused by difference between Manual Logging of Flight Time vs. DSC Automated Flight Time Generation

7. Costs avoided by decreasing frequency of Maintenance Test Flights due to Manual Logging of Flight Time vs. DSC Automated Flight Time Generation

8. Savings From Impact of CBM+ on Aviation Mishaps

(Paragraph IV. Measures of Effectiveness, Pages 20 – 21 of 79)

d. The AMCOM CBM+ program is pursuing software development that will allow automation, and thus elimination, of these checks. In addition, the same software will allow us to eliminate the need for annual max‐power checks on the engines. This MTF maneuver is a rather risky event, and eliminating it will be an added safety boon to the maintenance test pilot community. (Paragraph IV.4.g.viii, page 39 of 79)

e. In terms of streamline orders of high priority aviation spare parts, highly accurate prognostics on CBM‐monitored parts allow maintainers to predict when the part will fail or be replaced at scheduled maintenance and thus preorder to minimize aircraft downtime. In turn, this reduces stress on the supply system eliminating the need for high priority Class IX requisitions such as Aircraft‐On‐Ground (AOG) status. (Paragraph IV.4.i.ii, page 40 of 79)

f. CBM+ will improve the ability to conduct Battle Damage Assessment and Repair (BDAR). After an aircraft suffers combat‐ or accident‐related damage, it is often difficult to conduct accurate and complete BDAR on the system. Anecdotally, CBM technologies have improved a unit’s ability to understand the extent of damage, reduce testing/ inspection/troubleshooting time, and then allow faster repair of the aircraft for return to mission‐capable status. (Paragraph IV.4.j.ii, page 40 of 79)

g. Financially, CBM+ will pay for itself with an estimated 1.2 Benefit to Investment Ratio (BIR) over a 10 year operating period once all aircraft are DSC equipped and major CBM+ investments are executed. (Paragraph VII. Conclusions, page 51 of 79)

h. Reductions in Parts demand resulting from changes caused by difference between Manual Logging of Flight Time vs. DSC Automated Flight Time Generation

i. Costs avoided by decreasing frequency of Maintenance Test Flights due to Manual Logging of Flight Time vs. DSC Automated Flight Time Generation


29

j. Savings From Impact of CBM+ on Aviation Mishaps

2. A Decision Support Model for Determining the Application of Prognostics Health Management (PHM) Approaches to Electronic Systems – Peter Sandborn, CALCE, Department of Mechanical Engineering., University of Maryland. (Proc. Reliability and Maintainability Symposium (RAMS) Arlington VA Jan 2005).

a. The paper presents a model that enables the determination of when scheduled maintenance makes sense, and how to optimally interpret PHM results for electronic systems.

b. “Although man applicable models for single and multi‐unit maintenance planning have appeared, the majority of the models assume that monitoring information is perfect (without uncertainty) and complete (all units are monitored the same), i.e., maintenance planning can be performed with perfect knowledge as to the state of each unit. For many types of systems, and especially electronic systems these are not good assumptions and maintenance planning, if possible at all becomes an exercise in decision making under uncertainty with sparse data.“

3. The Considerations for a Business Case Analysis (BCA) supporting DoDI 4151.19, Serialized Item Management (SIM) was used an example for a this CBM+ BCA information paper.

4. Department of the Navy (DON) Memorandum for Distribution‐ 6 Nov 2007, DON Guide for Developing Performance Based Logistics Business Case Analyses (P07‐006) provides amplifying guidance and information in development of Performance Based Logistics PBL) BCAs.

5. NDIA Final Report of the EHM Committee – October 2009

6. US Air Force Material Commend PBL Checklist dated 31 May 2007

7. U.S. Army Standard Operating Procedure for Cost Benefit Analysis Review Board dated 13 May 2010. In accordance with a 30 December 2009 HQDA Memorandum, the Army has implemented a standard operating procedure for conducting and reviewing BCAs. This procedure defines the responsibilities, a process flowchart, a BCA checklist, and specific formats for BCA reports to the DASA (Cost and Economics).

8. U.S. Army Cost Benefit Analysis Guide Version 1.0 dated 12 January 2010 ‐ Assistant Secretary of the Army Financial Management and Comptroller Memorandum dated 1 February 2010. This guide provides general guidance for planning and conducting Cost Benefit Analyses.

9. USAF High Velocity Maintenance brief ‐ Jun 2010. Outlines a maintenance concept that improves “How Mx is Done” by applying standard high velocity maintenance processes, synchronized to optimize flow time; provide pre‐planned support; Point of Use tasking and mechanic centric focus to increase velocity.

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