2156. Cost and Weight: When More is Less, and Less is More

Paper

Abstract

Physical characteristics associated with proposed new products are often used as a basis for estimating their cost. In the aerospace industry in particular, parametric cost analysis (as this method is commonly called) is mostly used to develop rough order of magnitude estimates of alternative new systems during the conceptual development phase of the life cycle. Mass properties (weight) in particular have traditionally demonstrated a relatively high positive correlation to cost and have been utilized in developing parametric estimates. While the correlation between weight and cost is generally recognized, it is often misunderstood. In today’s cost-conscious environment, weight-based parametric cost analyses have come under criticism as a means for estimating and comparing alternative systems. The criticisms center on two primary reasons. First, the positive correlation (increasing weight increases cost) appears to negate cost reduction approaches which trade increased weight for reduced cost, such as increased margins or using less expensive materials and fabrication processes. Second, using Cost Estimating Relationships (CERs) based on historical data necessarily reflects the high cost of current standard business practices. Estimating new systems using cost models based on old systems tends to perpetuate the current high cost environment in a circular trap of self fulfilling prophecies. By itself, the estimating process leaves no room for the injection of cost reducing changes, or New Ways of Doing Business (NWDB). Much of the substance of these criticisms stems from a misunderstanding of the philosophy and proper application of weight-based estimating methods. Proper evaluations of such things as weight for cost trades can only be made when the alternatives are compared on an ”apples-to-apples,” or equal level of performance basis. Changes in materials and processes change the basis of the relationship between weight and cost. Adjustments must be made to properly account for these changes. Estimates of the cost impacts of NWDB are most credibly made when a clear, traceable path from an historically based point of departure is drawn. Historically based CERs offer such a point of departure, which, when combined with innovative estimating techniques, can provide traceable, and thus credible, estimates incorporating NWDB. This paper describes ways in which parametric techniques can account for the trading of weight for cost and the introduction of NWDB. The techniques are illustrated with example applications of weight-based CERs used in a structures material selection trade study and the use of NWDB in the manufacturing process.