Government

Cost Driver

In support of the Total Ownership Cost (TOC) program, GP Strategies developed Cost Driver, a graphical approach for viewing cost drivers. With this insight, we were able to interpret the cost driver information to reduce program infrastructure costs and development initiatives, and convert the savings into revenue flow for the program. The articles listed below provide a guide to this development and identify areas of application.

You can learn more about GP Strategies’ Cost Driver program by downloading the articles below.

• Development of the 5P Cost Driver Approach—Discusses the differences between Life Cycle Costs (LCC) and TOC and the need for the Cost Driver model. (97KB PDF)
• Government Cost Driver Profile Process—Illustrates how a Cost Driver profile is created and provides program examples. (28KB PDF)
• Cost Driver Initiative Process—Discusses the initiative process GP Strategies has developed using the Cost Driver model. (42KB PDF)
• Cost Driver Earned Value Management (CDEVM)—Discusses the enhancement to the current Earned Value Management approach that addresses only LCC and not infrastructure issues associated with TOC. (12KB PDF)
• Cost Driver Funding Cuts RECLAMA Application—Presents a case where Cost Driver was used in a RECLAMA action. (12KB PDF)

Life Cycle Cost Modeling

GP Strategies’ Cost Driver has been expanded to include life cycle cost modeling. This approach has been successfully used in government program life cycle cost analysis decision making for the Photonics Mast program, the AN/BLQ-10 program, and the development of operation & support budget estimates for the Large Aperture Bow (LAB) array.

You can learn more about GP Strategies’ Cost Driver Life Cycling Cost Modeling program by downloading the article below.

• Program Life Cycle Cost Driver Model (LCCDM)—Provides an understanding and process to apply the basic Cost Driver Modeling approach to identifying solutions to product life cycle issues and the effects of these decisions on future product operating costs. (170KB PDF)

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