Trends in Nunn-McCurdy Cost Breaches for Major Defense Acquisition Programs

摘要

Since 1997, there have been 74 Nunn-McCurdy breaches involving 47 major defense acquisition programs. There were a larger number of breaches in 2001, 2005, 2006, and 2009, which coincides with changes in statute or presidential administration. The statutory changes added a program's original baseline estimate as a new benchmark against which to measure cost growth. During the last two changes in presidential administration, DOD did not submit annual comprehensive SARs, which, along with other factors, may have affected when breaches were reported. The Air Force had a higher proportion of total breaches compared to its proportion of total programs, whereas the Navy had a smaller proportion of breaches compared to its proportion of programs. Aircraft, satellite, and helicopter programs have experienced the largest number of breaches. Thirty-four different prime contractors were listed in the SARs for the programs that breached. Of the 47 programs that breached, 18 programs breached more than one time. Nunn-McCurdy breaches are often the result of multiple, interrelated factors. Our analysis of DOD data and SARs showed that the primary reasons for the unit cost growth that led to Nunn-McCurdy breaches were engineering and design issues, schedule issues, and quantity changes. Cost increases resulting from engineering and design issues may indicate that those programs started without adequate knowledge about their requirements and the resources needed to fulfill them. Many programs also cited revised cost estimates as a factor behind breaches, suggesting estimates were based on inaccurate assumptions. Our previous work shows that without the ability to generate reliable cost estimates, programs are at risk of experiencing cost overruns, missed deadlines, and performance shortfalls.