Can We Explain Cost Growth in Major Defense Acquisition Programs?

Abstract

This question asked in this article is whether the shared intellectual property of the acquisition community includes an adequate theory of cost growth in major defense acquisition programs (MDAPs). This question is given concrete form by cost growth data for 123 MDAPs. These data are grouped into categories, which range from very small—negative, in fact—cost growth to cost growth in excess of 100%. Potential explanations for this broad range of cost growth considered are: the conventional wisdom about cost growth; a recent RAND study that closely examined cases at both ends of the distribution, along with some possible extensions of that study; and a recent model of the root causes of cost growth. The author argues that each of these falls short; in particular, it seems that the defense acquisition community at large does not have a good explanation of cost growth in the broad range of 30% to 100%.