Application Of Design-To-Cost Concept To Major Weapon System Acquisitions

PSAD-75-91: Published: Jun 23, 1975. Publicly Released: Jun 23, 1975.

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GAO reviewed the application of the design-to-cost concept to major weapon system acquisitions in the Department of Defense (DOD).

GAO noted that: (1) DOD is applying its 4-year-old plan of designing weapon systems to a cost it can afford to virtually all major systems now in development; (2) as a result, the incidence of costly but marginally useful performance characteristics which contribute heavily to cost growth should diminish in weapons of the future; (3) the cost goal provides the discipline and the challenge which drive design-to-cost; (4) although considered flexible the cost goal has not been raised thus far on any of the systems; (5) although design-to-cost appears to hold out hopes for reducing weapon system acquisition costs, a reduction in expenditures for weapon systems should not be anticipated; (6) whatever savings accrue from lowering the acquisition cost presumably will be applied to purchasing additionally needed quantities of weapons; (7) since none of the weapon systems has yet seen any major production, firm conclusions as to the program's success, or recommendations for its improvement, would be premature; and (8) GAO believes that a number of questions about systems designed to a cost must await further experiences with the program, such as whether: (a) system acquisition costs have been reduced at the expense of higher operating and maintenance costs; (b) design austerity, which could reduce a system's multimission and growth potential, would foster a proliferation of weapons to satisfy essentially similar needs; (c) the pace of technological advancement will be slowed; and (d) the military services would attempt to reinstate through subsequent costly modification programs performance features discarded in development because of high cost.

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