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In terms of the valuation of assets at the sub-corporate level, several of these approaches can be applied even though they are generally geared towards the valuation of the entire corporate entity. On the one hand, we advocate comparing common units of output among commercial and governmental processes, which is similar in nature to the comparison of price per square foot. On the other hand, we use these common units to establish a price per unit that can be aggregated in the governmental processes to establish a revenue estimate. To accomplish this, we use the KVA approach to establish common units of output for DoD processes and comparable processes in for-profit companies. The commercial companies’ revenue is allocated to their common units of output from all sub-corporate processes. This establishes a range of prices per unit of output among the sampled commercial companies. The average price per unit then can be applied to the outputs of the comparable DoD processes to achieve an aggregated revenue figure (i.e., average price per unit of aggregated output in terms of the number of common units of output). In this way, revenue streams are assigned to the processes. Because the amount of units of output from each process asset is known, the surrogate revenue for each asset can be assigned. In terms of choosing the approach to valuation, there are several factors to consider. The foremost is related to the choice of the assets to be valued. This choice revolves around the idea of which aspect of the asset means the most to the valuation. Is basing the value upon the physical characteristics of the asset itself or on the core processes a better determination of value? For example, the Puget Sound <strong>Naval</strong> Shipyard in Bremerton Washington is the Navy’s sole site for the overhaul of Nuclear-powered Aircraft Carriers. If one were to make a market comparison based upon the physical nature of the assets, one would need to find and value a commercial shipyard that overhauls large, nuclear-powered vessels. Unfortunately, that would be impossible. There are shipyards that build nuclear ships (Northrup-Grumann) but the comparison between a building yard and a repair yard will likely run into problems of scale and scope. However, if the market-comparables approach were based upon a comparison of core processes, there would likely be a larger number of ready comparisons. The core processes of a shipyard that repairs large Navy (100,000 ton) vessels that require regular maintenance are comparable to commercial shipyards that repair large cruise ships and oil tankers. Both of these types of vessels can and do approach the size of an Aircraft Carrier; both are productive assets that need maintenance; and both are assets that need to be returned to productive service in a minimal amount of time. Thus, the comparison based upon core processes can create market-comparables valuation that might closely approximate that of the government shipyard. In this presentation, we will discuss on-going research into a proof-of-concept application of market comparables to analyze the value of undertaking an “open-architecture” (OA) approach to the development of combat systems suites. The Program Executive Office, Integrated Warfare Systems (PEO IWS), OA Division is charged with implementing the Navy’s OA plans, policies and initiatives. One of these initiatives is the development of an openarchitecture approach to implementing a situational awareness (SA) system for the DD(X) project. To accomplish this, PEO IWS has looked at both the AEGIS and SSDS platforms to determine specific elements of each track management system that could be reengineered using an OA approach for placement into the DD(X) program. In doing this, metrics must be looked at to determine the best modules that might be candidates for open architecture. = = ==================^Åèìáëáíáçå=oÉëÉ~êÅÜW=ÅêÉ~íáåÖ=ëóåÉêÖó=Ñçê=áåÑçêãÉÇ=ÅÜ~åÖÉ=======- 309 - = =
This research project gathered information from subject matter experts (SME) from the Surface Fleet and from training commands at Dahlgren (AEGIS) and Wallops Island (SSDS). The process information garnered from these SME’s was aggregated to provide a value for each process using the KVA methodology. The resulting Return on Knowledge (ROK) was then by analyzed to determine where information technology, specifically with relation to open architecture, could be applied to enhance the operational capabilities of a <strong>Naval</strong> vessel. Finally, a market-comparables analysis was conducted on ROK values generated from a proposed model of the system. The output of this analysis provides the sponsor with a clearer idea of specific processes within the systems that could be reengineered with an open-architecture (OA) approach to provide the greatest efficiency to the operational fleet. The KVA data also provides the inputs to the analysis of the real options that the OA approach provides for IWS development. = = ==================^Åèìáëáíáçå=oÉëÉ~êÅÜW=ÅêÉ~íáåÖ=ëóåÉêÖó=Ñçê=áåÑçêãÉÇ=ÅÜ~åÖÉ=======- 310 - = =
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Author(s) Title Publisher Issue Dat
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The research presented at the sympo
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Preface and Acknowledgements Those
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The NPS A Team Rear Admiral James B
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4 th Annual Acquisition Research Sy
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PANEL -- IMPLEMENTING AN OPEN SYSTE
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Plenary Panel - Acquisition Reform
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In May 1996, Rear Adm. Hamilton bec
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Panel - Enhancing Collaborative Cap
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Collaborative IT Tools Leveraging C
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Group’s Perceived Usefulness Grou
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diagnose collaborative capacity enc
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Organization A Problem Interagency
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Incentives - Collaboration as a pre
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Two other frequently cited barriers
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Panel - Analytic Approaches to Shap
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Discussant: Michael McGrath - Deput
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Panel - Strategic Sourcing Wednesda
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Abstract In this paper, we examine
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support from the taxpayer. A key co
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etc. (Figure 1) (Kraljik, 1983). Vi
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that companies adopted a strategic
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Benchmarking Industry According to
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80% 70% 60% 50% 40% 30% 20% 10% 0%
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initiatives. In efforts to reduce s
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eduction goals. Also, in the same m
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Conclusion The DoD is struggling to
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Gabbard, E. G. (2004, April). Strat
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Staff. (2005, December 8). Hacket r
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Panel - Implementing RFID in the De
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What Is the Right RFID for Your Pro
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Introduction The evolution and appl
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Literature Review RFID technology w
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The reader is a device used to coll
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Active tags sometimes have sensors
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An RFID network with open architect
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Passive tag application: Railcar ta
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This system has lowered the risk of
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Because of the temperature-induced
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Thereafter, through a process of tr
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to be read at a few inches by an op
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RFID technology has even enhanced s
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The Costs of RFID operation An RFID
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• Abandonment: The ability to aba
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Fleisch, E., & Tellkamp, C. (2005).
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Williams, D. (2005, August 4). Pres
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logistics systems from the military
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Panel - Transforming the DoD Acquis
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upon the best knowledge and practic
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cost, this form appears to be the m
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access to, and conducted his analys
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organizational problems surface thr
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Change in analytic framework. Burea
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As we look at the effort to change
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interpretation or narrative. What
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common construction. Rather, sense-
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There will be a temptation for acto
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modeling suite. The key comparison
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This model provides us also with th
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here, particularly if the organizat
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organization identified through pri
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Levitt, R.E., Thomsen, J., Christia
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BACKGROUND To an extent, we are add
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Concept Refinement Concept Decision
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some subset of commercial “best p
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transforms the value of a public-se
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We also assume that since the gover
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Of course, we know in reality that
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CONCLUSIONS The acquisition of publ
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Panel - Issues in Acquisition and P
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To What Extent are DoD Activities C
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NAVSUP Data Call (2003 and 2004) FI
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exemption from a particular regulat
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time in the procurement schedule, a
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should be fully supported by applic
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example, federal government, state
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ADR Techniques Traditional litigati
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out the top three with 25.7% of res
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It is a consensus building, public
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Investigative Question 1—Conclusi
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Question 3b: Did the ADR process us
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suited than another to resolution.
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Investigative Question 7: Barriers
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customer, and each of these service
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Panel -- Implementing an Open Syste
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Open Systems and Modular Open Syste
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procurement planning phase include
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procurement documents and specific
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system technical architecture requi
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These evaluation factors are tradit
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In the Cost Reimbursement contract
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technical, schedule, and past perfo
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Developing Performance Based Requir
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The DoD Performance Specification d
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due to many of the reasons presente
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even if there were ten other upgrad
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software developers can employ when
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Conducting this analysis will be as
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integration of “best of breed”
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Reform of Budgeting for Acquisition
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350000 300000 250000 200000 150000
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In fact, the disagreement between t
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Functional Area Analysis D O T M L
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Though many in Washington blame the
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In response to an open-ended questi
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CAPITAL BUDGETING IN THE DoD AND TH
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investment. Full funding also helps
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c. Functional Requirements If it is
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4. Budgeting Phase of Capital Progr
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private firm, one can combine the t
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4. Acceptance of a project using th
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Another disadvantage of the payback
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Another guideline is that firms mus
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This concept has remained consisten
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purchases. Also, the Office of Mana
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CONCLUSIONS The current practices o
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REFERENCES Bierman Jr., H., & Smidt
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Ratnam, G. (2005, December 12). Big
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Brian C. Payne, Captain Instructor
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A Transactions Cost Economics (TCE)
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SECTION 1: INTRODUCTION This report
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SECTION 2: REVIEW OF TRANSACTION CO
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cooperative agreements, but since t
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characteristic that defines many ou
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The added risk faced by military co
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J) Some Empirical Evidence On the w
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unproductive bargaining and influen
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also include the costs of internal
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N) Results from a Bargaining-game M
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efforts to screen for reliability a
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Program Managers lead Program (Proj
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Table 2. Research, Development, Tes
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To minimize transaction costs for t
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A recent initiative to accommodate
Page 271 and 272: Technical complexity within a syste
Page 273 and 274: As briefly introduced above in Sect
Page 275 and 276: Table 5. Typical Contract Type by P
Page 277 and 278: multiyear procurements and other ty
Page 279 and 280: Alpha Contracting reduces procureme
Page 281 and 282: SECTION 4: SYNTHESIS AND CONCLUSION
Page 283 and 284: Finally, DoD contracting practice w
Page 285 and 286: Productive Effort Parameters Unprod
Page 287 and 288: f. Operational Significance. (added
Page 289 and 290: enchmarks, and the like. Elements T
Page 291 and 292: Cooter, R., Marks, S., & Mnookin, R
Page 293 and 294: Nissen, M. E. (1997). JSOW alpha co
Page 295 and 296: Development of Measures of Success
Page 297 and 298: of acquisition practitioners to all
Page 299 and 300: Attributes of Good Metrics. Certain
Page 301 and 302: Center ACEs were from separate loca
Page 303 and 304: unique. Every interview transcript
Page 305 and 306: appropriate. However, when asked if
Page 307 and 308: they are receiving in their attempt
Page 309 and 310: forcing each activity and report to
Page 311 and 312: Force Space Command System Program
Page 313 and 314: corporate Air Force acquisition ini
Page 315 and 316: Hayes, B. Measuring Customer Satisf
Page 317 and 318: Pope, K. Measuring the Effect of th
Page 319 and 320: Using KVA and Real Options Analysis
Page 321: Estimating Return on Investment and
Page 325 and 326: “I have determined that the curre
Page 327 and 328: On Budget Allocation to Increase Op
Page 329 and 330: Panel - Perspectives in Program Man
Page 331 and 332: Best Practices: Better Support of W
Page 333 and 334: When Should You Terminate Your Own
Page 335 and 336: - Management activities, expenditur
Page 337 and 338: RF COMMUNICATIONS DIVISION ROCHESTE
Page 339 and 340: REQUIREMENT HF MANPACK TACSAT VHF/F
Page 341 and 342: Figure 4. System Components INTEGRA
Page 343 and 344: My best technical experts would spe
Page 345 and 346: “JULIE-GATE” The program was st
Page 347 and 348: All agreed it was finally over, and
Page 349 and 350: A short time later, the world waite
Page 351 and 352: some of NASA’s Mars probes) or if
Page 353 and 354: managing systems with tipping point
Page 355 and 356: The second example of tipping point
Page 357 and 358: Although the plant did not begin co
Page 359 and 360: snt - add-new-tasks strength {work
Page 361 and 362: einforcing loop. We show how, throu
Page 363 and 364: there is no more project backlog. F
Page 365 and 366: Frac requiring rework (Frw ) 1.0 0.
Page 367 and 368: Total Backlog as a Fraction of Inti
Page 369 and 370: provide opportunities for improveme
Page 371 and 372: divided into avoiding tipping point
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The horizontal axis of Figure 14 re
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Total Backlog Total Backlog/Initial
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deadline and ensuring that it is re
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unrealistic due to drastic changes
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Kharbanda, O., & Pinto, J. (1996).
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Panel - Service Contracting Thursda
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Managing the Services Supply Chain
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include professional, administrativ
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Service Characteristics and their I
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given stage is made dependent on th
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contracted effort. The procurement
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Construction, Repair and Maintenanc
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The second phase of the procurement
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human capital. This is partially du
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for the contracting of services wil
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Yet a RAND study of the Army showed
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services, the Army appears to have
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(janitorial) services, food service
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Each requirement organization provi
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Brown, S. W., Gummesson, E. Edvards
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Gronroos, C. (1982). Strategic mana
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What Works Best when Contracting fo
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Panel - Earned Value Management Thu
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Measuring Uncertainty in Earned Val
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level of rate-of-change and the abs
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But, if the widget is only half com
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so more rapidly in environments cha
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Impending Task Delays (ITD) can be
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with: v: In the Fisher model, it re
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In discrete time form, the estimati
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Thus, various types of delay such a
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Entropy The uncertainty (non-specif
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Panel - Contractors in Support of M
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Contractors Supporting Military Ope
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drivers and other historical refere
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Another factor driving toward incre
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number of highly experienced Blackw
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Unity of command is one of the prin
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was reimbursed for expenses actuall
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principles, such as unity of comman
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aircraft involved in re-supply miss
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President Cheney) has apparently ma
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modest proposals for incremental ch
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In July 1937, the “China Incident
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President Roosevelt’s assistant,
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Pilots of the Flying Tigers receive
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was larger than the marine aid stat
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Merchant vessels kept Britain in th
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The final vignette involves Charles
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contract (Wake Island pre-war). In
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purposes continues to be the “leg
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Going to War with Defense Contracto
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Abstract This paper reports on an e
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Table 1: Factor loadings and alpha
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depict causal relationships tested
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work-related experience than younge
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Discussion and conclusion On averag
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2003 - 2006 Sponsored Acquisition R
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NPS-PM-04-017 Matthews, David. The
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Technical Reports NPS-GSBPP-03-003
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