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Table 5. Typical Contract Type by Phase (DAU, 2004)
CR TD SDD/SI SDD/SD PROD
CPFF, FFP CPFF, FFP CPFF, CPIF CPIF, CPAF FPI(F), FFP
E) Transaction Attributes Affect Acquisition Governance
The limited scope of this research study can hardly do justice to the vast arena of
contract management by our mere mention of contract types according to risk, etc. Our
purpose is to simply emphasize that defense acquisition transactions are multi-faceted with
multiple variants, but primarily focus on aspects of cost, schedule and technical performance
as success measures, governance determinants, and influences on the contracting vehicle.
Other factors that have an important bearing on acquisition transactions include economic
factors such as whether or not the supplier base is highly competitive; whether or not
requirements are fully known (the degree of uncertainty); the materiel mission environment,
etc. However, our observations of the many types of transactions for acquiring materiel and
the range of contract vehicles employed exhibit a somewhat linear incorporation of
governance along the growth lines of cost, schedule and technical performance risks, as in
Figure 4 below. Perhaps the most important conclusion to draw from this discussion is that
the TCE characteristic of asset specificity does not appear to have been captured as a key
concern of acquisition transactions in the traditional applied literature or in defense and
other federal acquisition policy documents; although, we have found practices that (at least
indirectly) address this important characteristic of economic behavior.
Figure 4. Governance According to Transaction Attributes of Cost Schedule and
Technical Performance
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