A special two-day course for those involved in preparing and pricing Government contract proposals - proposal managers, writers, marketing personnel, program managers, engineers, accountants, and executives.

In Government contracting, the first step is the biggest: determining the price for which you are willing to perform. For this step is the fulcrum upon which is balanced the ultimate profitability of-or loss from your efforts. Underlying that step is the cost estimate which forms the foundation for your price.

Whether you represent industry or Government, we believe you will find the program of interest if you are involved in: estimating costs, or evaluating contractors' estimates - using estimates for negotiation purposes, pro or con - pressing claims based on estimates, or defending against claims. In short, if you in any way deal with estimates during the overall contracting process.

A special course of this nature is particularly pertinent because cost estimating is not simply a matter of 1+1=2. And, from the Government's standpoint, the evaluation of contractors' estimates is more than just a mathematical calculation. Estimating involves a combination of factual data, experienced-based analysis, imagination and cultivated sophistication. It is part science, part art - all of which means that it must be taught by a seasoned professional.

This is a hands-on workshop in cost estimating for Government contracts. It teaches how to do cost estimating for both products and services in response to our shift to a service economy. Please keep in mind that the days you spend with us will be demanding-requiring your fullest concentration and intellectual commitment. Understanding these terms, we invite your decision. If you choose to attend, we welcome you.

The Course Curriculum

The course starts out identifying the basic elements of cost estimating and explaining basic cost estimating techniques for both products and services. It continues with practical examples, exercises, and the development of a framework and methodology for product and service cost estimating and analysis. A special software cost estimating component is included as an example of service cost estimating.

1. Introduction to Cost Estimating
   1. Definition of estimating
   2. Estimating techniques
      1. Delphi
      2. Analogy
      3. Bottoms-ups
      4. Parametrics
   3. Cost estimating process
   4. Cost analysis vs. Price analysis
2. Selecting the Team
   1. What makes an estimator?
   2. Knowing the estimate's purpose
   3. Technical/engineering support
      1. Synergy between cost and technical team members
   4. Subject matters experts (SMEs)
3. Establishing the Technical Baseline
   1. Work breakdown structure (WBS)
   2. Schedule
   3. Technical Characteristics
      1. What the product/service looks like
      2. What the product/service is supposed to accomplish
   4. Programmatic characteristics
      1. How the product/service will be acquired and maintained
4. Data Collection and Analysis
   1. Sources of data
   2. Data storage and retrieval
   3. Normalization of data:
      1. Technical complexity
      2. Programmatic differences
      3. Anomalies
      4. Inflation
      5. Production rate
5. Analogy Estimation
   1. System engineering analogy
      1. Selecting analogs
      2. Assessing relative complexity
      3. "reasonable" vs "correct"
6. Parametrics
   1. Ratios and factors
   2. Cost estimating relationships (CERs)
   3. Parametric cost models
7. Bottoms-up
   1. Labor estimation
      1. Labor hour/rate analysis
      2. Learning/improvement curve
      3. Labor standards
   2. Materials
   3. Other direct costs (ODC)
   4. Indirects
      1. Overheads/general and administrative (G&A)
   5. Profit/fee
      1. Weighted guidelines
8. Documenting the Estimate
   1. The role of judgment
   2. Estimating rationale
   3. Basis of estimate (BOE)
      1. Base data
      2. Quantitative adjustments
      3. Rationale
9. Risk Assessment
   1. Sources of risk
   2. Risk mitigation techniques
      1. Challenging technical inputs
      2. Challenging cost inputs
      3. Utilizing multiple sources
   3. Risk Modeling
10. Special Topics
    1. Price-to-Win(PTW)
    2. Activity-Based Costing (ABC)
    3. Cost as an Independent Variable (CAIV)
    4. Life Cycle Cost (LCC)/Total Ownership Cost(TOC)
11. Comprehensive Practical Exercise
    1. Developing the technical baseline
    2. Searching for relevant data
    3. Selecting and applying the right technique(s)
    4. Assessing the risk inherent in the estimate
    5. Documenting the process and results

The Course Director

Frank Flett President of Flett & Associates, a consulting firm which provides specialized proposal support to companies seeking to win competitive procurements; develops independent cost estimates and cost targets, risk analysis, and competitive assessments. • Over 20 years of experience in Government systems acquisition and has played key roles in proposal evaluation and proposal preparation for major weapons and information systems. Has served on a large number of cost proposal evaluations for all of the armed services and has served as an integral member of many cost proposal preparation teams for industry. • Previously served as the Manager of Cost Analysis at TASC, where he directed independent cost estimates and research projects on behalf of the Dept of Defense, the FAA, the Dept of Transportation, and other agencies. • Chaired several Source Selection Evaluation Board [SSEB] cost teams. Served as an Independent Cost Estimate Team Leader at the Air Force Electronic Systems Division, where he prepared and presented estimates and final SSEB cost evaluations on major radar, communications and information systems. • Frequent lecturer for Government and industry forums; honored as "Estimator of the Year" in 1988 by the National Estimating Society. • Bachelor of Arts degree in Government from Harvard University; MBA in Finance form Northeastern University.