Date of Award

3-23-2018

Document Type

Thesis

Degree Name

Master of Science in Cost Analysis

Department

Department of Mathematics and Statistics

First Advisor

Edward D. White, PhD

Abstract

The fundamental purpose of an Engineering Change Proposal (ECP) is to change the requirements of a contract. To build in flexibility, the acquisition practice is to estimate a dollar value to hold in reserve after the contract is awarded. There appears to be no empirical-based method for estimating this ECP withhold in the literature. Using the Cost Assessment Data Enterprise (CADE) database, 533 contracts were randomly selected to build two regression models: one to predict the likelihood of a contract experiencing an ECP, and the other to determine the expected median percent increase in baseline contract cost if an ECP was likely. Results suggest that this two-step approach works well over a managed portfolio of contracts in contrast to three investigated rules-of-thumb. Significant drivers are the basic contract cost and the number of contract line items.

AFIT Designator

AFIT-ENC-MS-18-M-200

DTIC Accession Number

AD1055951

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