Program managers and defense manufacturers frequently are caught between opposing imperatives: deliver increasingly capable and complex systems while simultaneously reducing costs. In an era of uncertain defense budgets and a shrinking procurement base, the traditional approach of squeezing savings through incremental cost reduction initiatives no longer supports the targets required by Department of Defense (DoD) programs. In response, a few innovative programs have initiated a step-change in performance, delivering more effective systems at a dramatically lower cost to the customer. Manufacturers have taken a “total cost” perspective by systematically evaluating all cost drivers, starting with the actual platform design.
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