Cost Engineering and Axiomatic Design

MIT

Cost Engineering in Axiomatic Design

2.882 May 2nd, 2005

MIT

Cost: Whats the problem?

Cost nightmare The Big Dig

$2.6B (1982) to $14.6B (2004)

Ingalls Shipbuilding Co. Continuous design change, required

by the Navy $2.7B unsettled claim U

SS

Pel

eliu

Bos

ton

s B

ig D

ig

Photo removed for copyright reasons.

Photo removed for copyright reasons.

MIT

Freiman Curve

0

Fina

l Pro

gram

Cos

t

0

Estimated Cost

10

1 = Underestimates lead to disaster

1 2 3

2 = Realistic estimatesminimize final costs

3 = Overestimates becomeself-fulfilling prophecies

The Freeman Curve

20

10

20

Figure by MIT OCW. Adapted from Freiman, F. R. The Fast Cost Estimating Models. AACE Transactions (1983).

MIT

Fail to address: Credible cost estimation Cost drivers Cost management Schedule risk

WHY does a system cost how much?

TRACEABILITY

We need Systematic approach Better utilization of cost

data

MIT

Goals & Approaches

Goals Enhance the credibility of life cycle cost estimation Quickly predict the cost impact of engineering changes to

the system Identify key cost drivers to guide the cost reduction effort

Approaches Develop a general method for integrating cost information

into the system architecture Development, Production, Operation phase

Develop a method to predict the cost of system changes Requirement changes, Solutions changes

Integrate the method into a usable tool for designers/ engineers

Value

Cost CredibilityCost Credibility Cost information is tied to system design information viaCost information is tied to system design information via

Axiomatic Design (AD) frameworkAxiomatic Design (AD) framework Unified framework for cost estimation at different stages ofUnified framework for cost estimation at different stages of

system design by constructing a hierarchical structuresystem design by constructing a hierarchical structure

Capability to Assess the Cost Impact of ChangesCapability to Assess the Cost Impact of Changes Ramification of changes in a requirement and/or designRamification of changes in a requirement and/or design

solution is captured by AD frameworksolution is captured by AD framework The estimate of cost impact is quickly generated to supportThe estimate of cost impact is quickly generated to supportTraceability

decision making processdecision making process Key cost drivers can be identifiedKey cost drivers can be identified

MIT

Scope of cost estimation becomes apparentScope of cost estimation becomes apparentCompleteness, Visibility

MIT

Detailedsystem

Integrate physical entities(Bottom -up)

Establishinterfaces

Construct localassemblies

Satisfy systemmorphology

Identify physical components

Detailedsystem

Integrate physical entities(Bottom -up)

Establishinterfaces

Construct localassemblies

Satisfy systemmorphology

Identify physical components

CREDIBLE COST ASSESSMENT

Estimate the Systems Physical Solutions

Technical Scope Defined is the Scope Estimated

System Design & Development

CustomerNeeds

Define FRs

Map toDPs

DefineModules

Build FR -DP hierarchy(Top-down)

Decompose

CustomerNeeds

Define FRs

Map toDPs

DefineModules

Build FR -DP hierarchy(Top-down)

Mapping DPs into physical entities

Decompose

TECHNICAL CREDIBILITY

System changes are assessed

NASA Requirements (Level 1 & 2)

Identifies Lowest Level Requirements

& Interactions

MIT

Software Tool to Aid the Process

Courtesy of Axiomatic Design Solutions, Inc. Used with permission.

MIT

Software Tool Demonstration SDCM Development Module

DP1.3.1 is Evaluated for Change

Nature of a changeis further specified

% completion(hr)

50%Baseline Cost

Adjusted Cost

Time when the change is introduced(User selects this point)

Simulation input (change, project phase), Result (cost impact), and Details are summarized

Courtesy of Axiomatic Design Solutions, Inc. Used with permission.

MIT

Development Module Model Structure

Functional Design Change

Affected Design Parameters Identified

Axiomatic Design Framework

Cost Domain

Linking Functional and Costing Domains

Input

Output

Comment

FR1

FR11 FR12

FR111 FR112 FR121 FR122

FR1111 FR1112 FR1211 FR1212

:

FR1

FR11 FR12

FR111 FR112 FR121 FR122

FR1111 FR1112 FR1211 FR1212

:

DP1

DP11 DP12

DP111 DP112 DP121 DP122

DP1111 DP1112 DP1211 DP1212

:

DP1

DP11 DP12

DP111 DP112 DP121 DP122

DP1111 DP1112 DP1211 DP1212

:

Functional Domain

PhysicalDomain

CU1, $

CU2, $

CU11, $

CU21, $

CU12, $

CU13, $

CU22, $

:

CostDomain

Con

cept

ually

Des

ign

Ass

embl

e

Tes

t

Des

ign

Tool

ing

Fabr

icat

ion

Tes

t

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Tes

t

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Tes

t

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Tes

t

Inst

alla

tion

u0, W

ork

Vect

or (

hour

s)

Conceptually Design 400Assemble 40Test 100

Design 0.05 0.10 0.10 0.10 0.50 0.10 150Tooling 0.50 0.20 0.10 150Fabrication 0.50 0.10 75Test 0.70 0.40 20Installation 0.80 0.80 10




CU0: Thermal Protection

System CU1: Body Winward CU2: Wing Winward CU3: Nose TPS CU4: Insulation

Process Matrix

CU

0:

Ther

mal

P

rote

cti

on

Syst

emC

U1:

Bod

y W

inw

ard

CU

2: W

ing

Win

war

dC

U3:

Nos

e TP

SC

U4:

In

sula

tion

TaskModel

Task/Process model

MIT

Development Module Model Structure

k

2

1

CU............CUCU

test

nfabricatiotooling

analysis performdesign

.....

.....

test

codedesign

testfabricate

toolingdesign

Affected Components

Identify affected physical interfaces between components

Tasks Required to Implement Changes

--$--$--$--$--$

.....

.....

--$--$--$

--$--$--$--$

Cost Required to Implement Changes

Iterative Model Determines Time to Complete the Changes

Input

Output

Comment

MIT

Iteration model

0.3Task B

0.5Task A

Task BTask A

Work Transformation Matrix

1-= nn uWTu

( )0

2

000

10

)1( uWTWTWT

uWTWTuWTu

uuuU

N

N

++++=

++=++=

L

L

L

% completion(hr)

Time (iteration step)

Work completion curvefor the original design

MIT

Cost Impact of Change

% completion(hr)

50%

Remaining work for original design, X

User selects this point

Cost penalty = Y - X

MIT

Summary

FR1

FR11 FR12

FR111 FR112 FR121 FR122

FR1111 FR1112 FR1211 FR1212

:

FR1

FR11 FR12

FR111 FR112 FR121 FR122

FR1111 FR1112 FR1211 FR1212

:

DP1

DP11 DP12

DP111 DP112 DP121 DP122

DP1111 DP1112 DP1211 DP1212

:

DP1

DP11 DP12

DP111 DP112 DP121 DP122

DP1111 DP1112 DP1211 DP1212

:

Functional Domain

PhysicalDomain

CU1, $

CU2, $

CU11, $

CU21, $

CU12, $

CU13, $

CU22, $

:

CostDomain

Con

cept

ually

Des

ign

Ass

embl

e

Test

Des

ign

Tool

ing

Fabr

icat

ion

Test

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Test

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Test

Inst

alla

tion

Des

ign

Tool

ing

Fabr

icat

ion

Test

Inst

alla

tion

u0,

Wor

k Ve

ctor

(ho

urs)

Conceptually Design 400

Assemble 40Test 100

Design 0.05 0.10 0.10 0.10 0.50 0.10 150

Tooling 0.50 0.20 0.10 150

Fabrication 0.50 0.10 75

Test 0.70 0.40 20Installation 0.80 0.80 10

Design 0.05 0.10 0.10 0.10 0.50 0.10 150

Tooling 0.50 0.20 0.10 150Fabrication 0.50 0.10 75

Test 0.70 0.40 20

Installation 0.80 0.80 10

Design 0.05 0.10 0.10 0.10 0.50 0.10 150Tooling 0.50 0.20 0.10 150

Fabrication 0.50 0.10 75

Test 0.70 0.40 20Installation 0.80 0.80 10

Design 0.05 0.10 0.10 0.10 0.50 0.10 150

Tooling 0.50 0.20 0.10 150Fabrication 0.50 0.10 75Test 0.70 0.40 20Installation 0.80 0.80 10

CU0: Thermal Protection

System CU1: Body Winward CU2: Wing Winward CU3: Nose TPS CU4: Insulation

Process Matrix

CU

0:

Ther

mal

Pr

otec

tion

S

yste

mC

U1:

Bod

y W

inw

ard

CU

2: W

ing

Win

war

dC

U3:

Nos

e TP

SC

U4:

In

sula

tion

TaskModel

Complete Traceability from Design to Cost Information

MIT

Steps

1. Identify affected DPs from FR change2. Identify CU corresponding to DPs3. Identify CU from CU4. Estimate % rework input5. Estimate total change-workload

Cost Engineering and Axiomatic Design

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