Parametric cost modeling of an activity based proposal for a system of systems

Parametrics are often needed to model systems for which a cost estimate has been obtained by using an activity based bottom up approach (essentially adding single work breakdown structure (WBS) elements to obtain the total cost of the program/project). In order to properly compare the cost estimates obtained from a parametric model to the cost estimates obtained from a bottom up analysis of the same system, one needs to identify a common level of comparison. At such a level, groupings of work packages need to be related to specific products and said products must be modeled parametrically. In this paper we illustrate how the above was possible thanks to a standard product oriented work breakdown structure (WBS) adopted by the Italian Space Agency (ASI) and thanks to a set of assumptions relative to across the board type of activities such as Management and Assembly Integration and Testing (AIT) program. Parametric data was collected for the model thanks to specific parametric input sheets filled in by the bidder and its subcontractors. The companies involved were carefully instructed on how to complete the forms, and the data was revised through several iterations carried out by ASI with the bidder. The detailed parametric model also allowed to identify design inconsistencies and improve the systems mass budget estimates and detailed product tree definition. A bottom-up economic proposal was compared with an independent parametric estimate obtained with PRICE H using the tool to obtain normalized costs known as complexities for each unit and/or subsystem and by comparing said complexities to the ones obtained by normalizing the price offered by the bidder. The complexity of the subsystem elements obtained by the detailed complexity generator were compared with the complexity obtained by calibrating on the proposed price