Comparison of Traditional Methods versus Labor Standards in the Pricing of Defense Systems Contracts

摘要

Statutory provisions now require defense contractors to submit labor performance data, as well as cost and pricing data, with defense system proposals. Air Force Systems Command (AFSC) policy further requires the use of labor performance data, by both government and contractor personnel, to price and negotiate defense system contracts. Studies indicate that effective use of labor performance data, from a defense contractor's work measurement system, can result in more reasonable cost estimates, particularly in the case of sole source contracts. The labor performance data referred to here is a part of what is commonly known as work measurement. This study examined the evolving application of work measurement in the acquisition of defense systems. The study investigated the value of work measurement programs and explored techniques for using labor performance data in pricing defense contracts. The study also compared this pricing technique with more traditional methods. As the implementation of this idea has stirred some controversy, the research also examines the issues that have arisen.