Analysis of Design through Parametric Cost Estimation Techniques

Summary As alternative design comparisons have become more complex, cost comparisons take on significant meaning in the evaluation. The typical and time proven “grass roots” methods of cost estimating developed through industrial engineering and cost accounting disciplines can be time consuming and non-systems oriented. An alternative means to unit production cost estimating at the conceptual and early design stages is the “top down” or parametric model. The computerized parametric cost estimating model is used successfully by most international space industry contractors and government agencies, including the DOD and NASA in the United States and the MOD in the United Kingdom. This paper presents the pragmatic base upon which parametric models are developed and case study results comparing parametric model estimates with actual industrial production costs.