BY ORDER OF THE SECRETARY OF THE AIR FORCE

BY ORDER OF THE

SECRETARY OF THE AIR FORCE

DEPARTMENT OF THE AIR FORCE

PAMPHLET 63-123

14 APRIL 2022

Acquisition

PRODUCT SUPPORT BUSINESS CASE

ANALYSIS

ACCESSIBILITY: This publication is available on the e-Publishing website at www.e-

publishing.af.mil for downloading or ordering.

RELEASABILITY: There are no releasability restrictions on this publication.

OPR: SAF/AQD Certified by: SAF/AQD

(Ms. Angie Tymofichuk)

Supersedes: AFPAM 63-123, 1 June 2017 Pages: 124

This Department of the Air Force Pamphlet (DAFPAM) complements Air Force Instruction (AFI)

63-101/20-101, Integrated Life Cycle Management. It provides informational guidance and

recommended procedures for executing a Product Support Business Case Analysis (PS-BCA).

Additional non-mandatory guidance on best practices, lessons learned, and expectations are

available in the Department of Defense Product Support BCA Guidebook. To ensure

standardization, any United States Space Force (USSF) or United States Space Force (USAF)

organization supplementing this publication will send the implementing publication to the

Assistant Secretary of the Air Force/Product Support and Logistics (SAF/AQD) for review and

coordination before publishing. This publication applies to the Regular Air Force, the Air Force

Reserve, the Air National Guard, and, unless and until such time as independent guidance is issued,

the United States Space Force. It also applies to other individuals or organizations as required by

binding agreement or obligation with the Department of the Air Force (DAF). Note: Until such

time as the USSF issues its own guidance, all references to United States Air Force (USAF)

terminology, units, and positions will also apply to the equivalent in the USSF, as appropriate. For

example, references to Airmen will also apply to Guardians. References to MAJCOMs or NAFs

will also apply to Field Commands. References to wings will also apply to deltas/garrisons. Air

Staff roles and responsibilities (i.e. AF/A4) may also apply to the equivalent Office of the Chief

of Space Operations (Space Staff) office (i.e. SF/COO, etc), as appropriate. For nuclear systems

or related components ensure the appropriate nuclear regulations are applied as specified in AFI

63-101/20-101. Refer recommended changes and questions about this publication to the OPR

listed above using Air Force (AF) Form 847, Recommendation for Change of Publication; route

AF Forms 847 from the field through the appropriate chain of command. Ensure that all records

created as a result of processes prescribed in this publication are maintained in accordance with

2  DAFPAM63-123  14 APRIL 2022 
AFI 33-322, Records Management and Information Governance Program, and disposed of in 
accordance with the Air Force Records Disposition Schedule (RDS) in the Air Force Records 
Information  Management  System  (AFRIMS).  The  use  of  the  name  or  mark  of  any  specific 
manufacturer,  commercial  product,  commodity,  or  service  in  this  publication  does  not  imply 
endorsement by the Air Force. 
SUMMARY OF CHANGES 
This document has been substantially revised and should be completely reviewed.  It reflects 
process  improvements,  evolving  best  practices,  organizational  structure  changes,  and 
administrative updates. 
 
Chapter 1—OVERVIEW    7 
1.1.  Product Support Business Case Analysis (PS-BCA) Pamphlet Overview. .............   7 
1.2.  Business Case Analysis (BCA). ...............................................................................   7 
1.3.  Product Support Business Case Analysis (PS-BCA). ..............................................   8 
Figure  1.1.  Product Support BCA Elements. .............................................................................   9 
Figure  1.2.  Four Major Areas for 12 IPS Elements. ...................................................................   10 
1.4.  When to Conduct a PS-BCA....................................................................................   11 
Figure  1.3.  PS-BCA Schedule Throughout the Life Cycle. .......................................................   12 
Figure  1.4.  Step #1 of the PS-BCA Decision Tree. ....................................................................   13 
Table  1.1.  Step #1 Decision Tree Process Flow. ......................................................................   13 
Figure  1.5.  Step #2 of the PS-BCA Decision Tree. ....................................................................   15 
Table  1.2.  Step #2 Decision Tree Process Flow. ......................................................................   15 
Figure  1.6.  Step #3 of the PS-BCA Decision Tree. ....................................................................   17 
Table  1.3.  Step #3 Decision Tree Process Flow. ......................................................................   17 
Figure  1.7.  Step #4 of the PS-BCA Decision Tree. ....................................................................   19 
Table  1.4.  Step #4 Decision Tree Process Flow. ......................................................................   19 
Figure  1.8.  Step #5 of the PS-BCA Decision Tree. ....................................................................   21 
Table  1.5.  Step #5 Decision Tree Process Flow. ......................................................................   21 
Figure  1.9.  Step #6 of the PS-BCA Decision Tree. ....................................................................   23 
Table  1.6.  Step #6 Decision Tree Process Flow. ......................................................................   24 
1.5.  PS-BCA Process Overview......................................................................................   25 
Figure  1.10.  PS-BCA Process Map. .............................................................................................   25 
Chapter 2—ROLES AND RESPONSIBILITIES    26 
2.1.  PS-BCA IPT Members. ...........................................................................................   26 

DAFPAM63-123  14 APRIL 2022  3 
2.2.  Approval Level. .......................................................................................................   26 
2.3.  Milestone Decision Authority (MDA). ....................................................................   26 
2.4.  Governance Structure. .............................................................................................   27 
Figure  2.1.  MDAP/MAIS ACAT I and Special Interest OSD Programs. ..................................   28 
Figure  2.2.  ACAT II and III Programs. ......................................................................................   29 
2.5.  PS-BCA IPT Roles, Responsibilities, and Functions. .............................................   31 
Chapter 3—PLANNING FOR THE PRODUCT SUPPORT BUSINESS CASE ANALYSIS.   38 
3.1.  PS-BCA IPT Kickoff Meeting. ................................................................................   38 
3.2.  Preparation for Kickoff Meeting. .............................................................................   38 
3.3.  Identify and Establish the PS-BCA IPT. ..................................................................   39 
Table  3.1.  IPT Membership. .....................................................................................................   39 
3.4.  Kickoff Meeting. ......................................................................................................   41 
Table  3.2.  Integrated Product Support (IPS) Element Categorization. .....................................   43 
Chapter 4—COURSES OF ACTION    48 
4.1.  Introduction. .............................................................................................................   48 
4.2.  Status Quo ................................................................................................................   48 
4.3.  Future State COAs. ..................................................................................................   48 
Table  4.1.  Holistic Approach. ...................................................................................................   49 
Table  4.2.  Modular Approach. ..................................................................................................   49 
4.4.  Reasonableness and Feasibility. ...............................................................................   50 
Chapter 5—BENEFITS AND NON-FINANCIAL ANALYSIS    53 
5.1.  Benefits Introduction. ..............................................................................................   53 
5.2.  Selecting Benefits. ...................................................................................................   53 
Table  5.1.  Category Metric Attribute. .......................................................................................   54 
5.3.  Quantitative Benefits and Metrics. ..........................................................................   54 
Table  5.2.  Quantitative Benefits and Associated Metrics. ........................................................   55 
5.4.  Qualitative Benefits and Metrics. ............................................................................   55 
Chapter 6—COST AND FINANCIAL ANALYSIS    57 
6.1.  PS-BCA Cost Estimates. ..........................................................................................   57 
6.2.  Criteria 1 – Guided by the Problem Statement. .......................................................   57 
6.3.  Criteria 2 – GR&As are Reasonable and Documented. ...........................................   57 
6.4.  Criteria 3 – Properly Utilizes the Various Types of Analysis. .................................   58 

4  DAFPAM63-123  14 APRIL 2022 
6.5.  Criteria 4 – Properly Utilizes the Highest Quality Data Available. .........................   59 
6.6.  Criteria 5 – Data is Normalized, Projected and Used Correctly. .............................   59 
Figure  6.1.  Illustration of Inflation, Price Escalation, and Real Price Change. ..........................   60 
Figure  6.2.  Considerations When Normalizing Data for Usage or Quantity (or Duration). ......   61 
6.7.  Criteria 6 – Cost Estimates Accurately Represent the PSS for Each COA. ............   62 
6.8.  Criteria 7 – Ensure Cost Risk is Handled Consistently for Each COA. ..................   62 
6.9.  Criteria 8 – Enables Decision Maker to Make the Most Informed Decision 
Possible. ...................................................................................................................   63 
Chapter 7—RISK ASSESSMENT    64 
7.1.  Introduction to Risk Assessment. ............................................................................   64 
7.2.  Defining Risk. ..........................................................................................................   64 
7.3.  Progression of Risk. .................................................................................................   64 
7.4.  Classifications of Risk. ............................................................................................   65 
7.5.  Risk Management Planning. ....................................................................................   65 
7.6.  Risk Identification. ...................................................................................................   65 
7.7.  Risk Analysis. ..........................................................................................................   65 
7.8.  Risk Handling Planning & Implementation. ............................................................   66 
7.9.  Risk Tracking. ..........................................................................................................   67 
7.10.  Risk Management Summary. ...................................................................................   67 
Chapter 8—DETERMINING EVALUATION FRAMEWORK, WEIGHTING, AND 
SCORING    68 
8.1.  Weighted Utility Score (WUS) and Multi-Objective Decision Analysis (MODA).   68 
8.2.  COA Evaluation. ......................................................................................................   68 
Figure  8.1.  Weighted Utility Score (WUS). ...............................................................................   68 
Figure  8.2.  WUS Framework - No Weighting Assigned. ..........................................................   69 
Figure  8.3.  WUS Framework – Criteria Weighting (Notional Data). ........................................   69 
Figure  8.4.  MODA Framework – Criteria Weighting (Notional Data). .....................................   70 
8.3.  Steps to Build the WUS or MODA Framework. .....................................................   70 
Figure  8.5.  Cumulative Impacts of WUS. ..................................................................................   72 
Figure  8.6.  Updated WUS Framework. ......................................................................................   73 
8.4.  Displaying the Results – WUS and MODA (Cost Capability Analysis). ................   74 
Figure  8.7.  Risk Cube. ................................................................................................................   75 
Figure  8.8.  COA Weighting. ......................................................................................................   75 

DAFPAM63-123  14 APRIL 2022  5 
Figure  8.9.  WUS Display (Example 1). .....................................................................................   76 
Figure  8.10.  WUS Display (Example 2). .....................................................................................   76 
Figure  8.11.  MODA. ....................................................................................................................   78 
Chapter 9—DATA SELECTION, COLLECTION AND ASSESSMENT    79 
9.1.  Quality Data Collection. ..........................................................................................   79 
9.2.  Data Selection. .........................................................................................................   79 
Table  9.1.  Milestone Data Maturity. .........................................................................................   79 
Table  9.2.  Data Quality Tiers. ...................................................................................................   81 
Table  9.3.  Potential PS-BCA Data Sources. .............................................................................   81 
Table  9.4.  Example – Data Requirements and Selection. .........................................................   83 
Table  9.5.  Data Plan Considerations. ........................................................................................   84 
Chapter 10—SENSITIVITY ANALYSIS AND EVALUATION    88 
10.1.  Sensitivity Analysis Defined....................................................................................   88 
10.2.  Risk and Uncertainty. ..............................................................................................   88 
10.3.  Variables. .................................................................................................................   88 
10.4.  Steps in Conducting a Sensitivity Analysis. ............................................................   88 
10.5.  Examples for Using Sensitivity Analysis. ...............................................................   89 
10.6.  Applying Sensitivity Analysis to Weighting and Scoring of Benefits. ....................   90 
Table  10.1.  COAs and Attributes. ...............................................................................................   90 
Table  10.2.  Raw Weights. ...........................................................................................................   90 
Table  10.3.  Scaled Weights. .......................................................................................................   90 
Table  10.4.  COAs, Attributes, Raw and Scaled Weights............................................................   91 
Figure  10.1.  COAs Weighted Benefit Scores vs Their Cost. .......................................................   91 
Table  10.5.  Sensitivity Analysis Adjustment. .............................................................................   92 
Figure  10.2.  COAs Weighted Benefit Scores vs Their Cost after Weight Changes. ...................   92 
Figure  10.3.  Sensitivity Analysis Displays. .................................................................................   93 
10.7.  Applying Sensitivity Analysis to Benefits. ..............................................................   93 
10.8.  Shifting Attribute Scores. ........................................................................................   93 
Figure  10.4.  Global Sensitivity Analysis for Supply Support. .....................................................   94 
Figure  10.5.  Global Sensitivity Analysis for Sustaining Engineering. .........................................   94 
10.9.  Tipping Point. ..........................................................................................................   95 

6  DAFPAM63-123  14 APRIL 2022 
Chapter 11—FINDINGS, RECOMMENDATION, APPROVAL AND 
IMPLEMENTATION FOR THE FINAL PRODUCT SUPPORT 
BUSINESS CASE ANALYSIS REPORT    96 
11.1.  PS-BCA Report. .......................................................................................................   96 
Table  11.1.  PS-BCA Report Process. .........................................................................................   96 
11.2.  PS-BCA Findings. ...................................................................................................   96 
Table  11.2.  Findings Summary. ..................................................................................................   96 
Table  11.3.  Cost to the Program Output Example. .....................................................................   99 
Table  11.4.  Alternative Comparisons. ........................................................................................   99 
Figure  11.1.  COA Example for Transition Plans. ........................................................................   100 
Table  11.5.  Outline for PS-BCA Out-Brief. ...............................................................................   100 
Table  11.6.  PS-BCA Final Report Outline. ................................................................................   102 
Table  11.7.  Implementation Plan Outline. ..................................................................................   103 
Attachment 1—GLOSSARY OF REFERENCES AND SUPPORTING INFORMATION    105 
Attachment 2—LEGACY PROGRAM PRODUCT SUPPORT BUSINESS CASE 
ANALYSIS SUFFICIENCY MEMORANDUM    112 
Attachment 3—PROCESS NARRATIVE    113 
 

DAFPAM63-123 14 APRIL 2022 7

Chapter 1

OVERVIEW

1.1. Product Support Business Case Analysis (PS-BCA) Pamphlet Overview. Product

Support Business Case Analysis (PS-BCA) Pamphlet. This is designed to assist the PS-BCA Team

in developing comprehensive Product Support (PS) strategies that achieve the optimal balance

between warfighter capabilities and affordability (i.e., best-value). The pamphlet covers key areas

that the PS-BCA Team needs to consider when developing an effective PS-BCA. The pamphlet

provides a standardized format, assists in developing and evaluating courses of action (COAs),

recommends useful decision support methodologies that enhance defendable decision making

processes, and provides guidance on developing the PS-BCA report. Additionally, the pamphlet

provides examples and best practices, identifies existing laws, integrates Department of Defense

(DoD) guidance located in the DoD Product Support BCA Guidebook (April 2011), and

supplements existing Air Force Manuals (AFMANs) such as AFMAN 65-506, Economic Analysis

(September 2019). The focus of the pamphlet is on Major Defense Acquisition Programs

(MDAPs), however, the techniques provided can also be applied to any program using any

acquisition pathway.

1.2. Business Case Analysis (BCA). A Business Case Analysis (BCA) is a decision support

document that identifies COAs and then presents convincing business (both financial and non-

financial) impacts, risks, sensitivities, and technical arguments for selecting a specific COA that

will achieve desired objectives. A BCA provides a fair and objective study that leads to a decision,

not justify a decision after the fact. Specifically, a BCA is a comparative analysis product that fits

under the umbrella of the economic analysis approach. All BCAs are required to follow the

guidance in AFI 65-501, Economic Analysis, and AFMAN 65-506.

AFMAN 65-506 provides more detailed information on the elements that must be addressed as

part of the economic analysis approach whereas this pamphlet provides the standardized format

for completing BCAs as well as lessons learned and best practices.

1.2.1. Introduction. Defines what the business case is about (subject), why (purpose) it is

necessary, what the objectives are, and who the decision maker is for the BCA.

1.2.2. Problem Statement. Concisely defines the problem, requirement or opportunity being

analyzed. What problem is trying to be solved and is it realistic? What is the scope of the

analysis? The problem statement helps define the analysis framework.

1.2.3. Methods and Parameters. States the analysis methods and rationale that will fix the

boundaries of the business case (the costs and benefits examined over what time period). This

section also outlines the rules for deciding what belongs in the analysis and what does not.

Facts, ground rules, and assumptions are parameters that must be explicitly stated on what is

believed to be true of a current or identify future state of affairs. Further details regarding each

of these parameters can be found in AFMAN 65-506, Section 2.4.

1.2.4. Business and Operational Impacts. Documents costs, benefits and non-monetary

benefits impacting business and operational results for each COA.

1.2.5. Risk Analysis. Evaluates the probability of negative events occurring in each COA and

their impact on desired objectives.

8 DAFPAM63-123 14 APRIL 2022

1.2.6. Sensitivity Analysis. Demonstrates how the BCA results are affected by changes in key

variables such as assumptions, weightings, and key data drivers in the analysis. AFMAN 65-

506 requires a sensitivity analysis to test the effect that major assumptions have on analysis

results.

1.2.7. Recommendation and Implementation Plan. Recommends a preferred COA and the

action plan required to achieve desired objectives.

1.2.7.1. Per the DoD Product Support BCA Guidebook and AFMAN 65-506, a BCA does

not replace the judgment of the decision maker, but rather provides an analytic and uniform

foundation that allows decision makers to make informed decisions. A BCA can vary in

size and scope, is developed in an unbiased manner, and is not constructed to justify a

preordained decision. A key element in constructing an effective BCA is acquiring

sufficient data from reliable sources and then analyzing the information utilizing a

consistent methodology. With the same data and comprehensive documentation, readers

not familiar with the analysis should be able to replicate the analysis and arrive at the same

conclusions.

1.3. Product Support Business Case Analysis (PS-BCA).

1.3.1. Decision Support Document. A PS-BCA is a decision support document that assists

Product Support Managers (PSMs) in developing COAs for product support strategies using

the best value approach, which incorporates Integrated Product Support (IPS) elements.

Attachment 1 defines best value per the Federal Acquisition Regulation (FAR).

1.3.2. PS-BCA Process. The PS-BCA is an iterative process that incorporates organizational

or programmatic changes. PS-BCAs can be used for a number of purposes to include the

following:

Determine whether or not to change Product Support Strategy (PSS)

Determine whether or not to invest in product support

Determine whether or not to select among COAs

Validate proposed scope, schedule, or budget changes during the course of the program

1.3.3. Product Support Decisions. The PS-BCA supports major product support decisions,

especially those that result in new or changed resource requirements. Program Managers

(PMs) are responsible for deploying the PSS and monitoring its performance according to the

Life Cycle Sustainment Plan (LCSP). While the PS-BCA assists in the leaders’ decision

making process, it does not supersede or overturn other statutory requirements (e.g., 10 USC

§2464, Core Logistics Capabilities, 10 USC §2466, Limitations on the performance of depot-

level maintenance of materiel.

1.3.4. Major Elements. The PS-BCA has three major elements: purpose, process components,

and quality foundation (see Figure 1.1 below) that work together to ensure the PS-BCA targets

the relevant subject matter, analyzes and reports the results, and integrates into the

organization’s mission and vision.

1.3.4.1. Purpose. Identifies the problem statement, objectives, metrics, desired outcomes,

and requirements. The purpose annotates what problem the PS-BCA is attempting to solve

and how to measure success.

DAFPAM63-123 14 APRIL 2022 9

1.3.4.2. Process Components. Subsections of the PS-BCA that directly execute and report

on analytical actions. PSMs should refer to the DoD PS-BCA Guidebook and must follow

guidance in AFMAN 65-506 to determine what to include in the components section. Of

particular note, within the implementation plan, a PS-BCA should include predetermined

off-ramps. These off-ramps are actions to be taken when the desired objectives are not

being achieved for the selected COA.

1.3.4.3. Quality Foundation. Directly affects the quality and completeness of the analysis.

This section consists of research, due diligence (verifying the accuracy of the information),

governance (provides oversight), documentation, and data management.

Figure 1.1. Product Support BCA Elements.

1.3.5. Integrated Product Support (IPS) Elements. The PS-BCA is used to analyze a program’s

PSS and are represented by the 12 IPS elements, as identified in Appendix A of the DoD

Product Support Manager Guidebook. Each program is unique and the IPS elements to be

analyzed are dependent upon the specific sustainment requirements of the weapon system.

Rationale should be provided for each of the 12 IPS elements whether utilized or not within

the PS-BCA. The IPS elements categorize major support areas and provide standardized

definitions. One recommended approach in addressing the 12 IPS elements is shown in Figure

1.2 The 12 IPS elements are 1) Product Support Management; 2) Design Interface; 3)

Sustaining Engineering (SE); 4) Supply Support; 5) Maintenance Planning and Management;

6) Packaging, Handling; Storage & Transportation; 7) Technical Data; 8) Support Equipment;

9) Training and Training Support; 10) Manpower and Personnel; 11) Facilities and

Infrastructure; and 12) Computer Resources. Of the 12 IPS elements, those most often

compared between COAs within a PS-BCA are the following:

1.3.5.1. Product Support Management. Focuses on integrating all sources of product

support, public and private, within the scope of a product support arrangement.

1.3.5.2. Sustaining Engineering. Examines the technical tasks (i.e., engineering and

logistics investigations and analysis) required to ensure continued operation and

10 DAFPAM63-123 14 APRIL 2022

maintenance of a system. See AFI 63-101/20-101, Chapter 5, “Systems Engineering,” for

guidance on the engineering requirements that PMs will address to ensure the continued

operation and maintenance of a system.

1.3.5.3. Supply Support. Focuses on procuring, producing, and delivering products and

services to customers as well as the flow of funds.

1.3.5.4. Maintenance Planning and Management. Focuses on the maintenance of parts,

assemblies, sub-assemblies, and end items. This might include manufacturing parts,

making modifications, testing, and reclamation, as needed.

Figure 1.2. Four Major Areas for 12 IPS Elements.

1.3.5.5. The PS-BCA should follow the cost estimating guidance outlined in the DoD

“Cost Assessment and Program Evaluation (CAPE) Operating and Support Cost

Estimating Guide 2014” and be structured according to the IPS elements and the CAPE

Cost elements.

DAFPAM63-123 14 APRIL 2022 11

1.3.5.5.1. Best Practice. The Program Management Office (PMO) should also plan to

acquire government data rights and delivery of technical data as required by 10 USC

§2320, Rights in Technical Data. Prior to Milestone (MS)-B, the PMO should develop

a PS-BCA data collection plan that identifies the data requirements and data system

access requirements for the analysis. Information such as demand history for supply

chain (which parts are replaced or repaired and how often), maintenance repair

procedures/process, and product support performance metrics (e.g., Customer Wait

Time (CWT), engineering request response time) are types of information that can be

captured. In addition, cost reporting and priced bill of materials with the appropriate

amount of fidelity should be obtained if available.

1.4. When to Conduct a PS-BCA. The PS-BCA is a statutory requirement for all major weapon

systems based on 10 USC §2337, Life-Cycle Management and Product Support. Air Force

Instruction (AFI) 63-101/20-101 further identifies PS-BCA requirements as mandatory for

Acquisition Category (ACAT) I and ACAT II programs and at the discretion of the Milestone

Decision Authority (MDA) for ACAT III programs.

1.4.1. MDA Discretion. For existing platforms/systems, the MDA also has the discretion to

initiate a PS-BCA. All modification programs that are classified as ACAT I or ACAT II

programs also require a PS-BCA. PS-BCAs for modifications to ACAT III programs are at

the discretion of the MDA. However, once modifications are in the sustainment phase,

consolidate the modification PS-BCA into the system/platform level PS-BCA. The PS-BCA

should begin as early as pre-MS-A or initial entry into the acquisition life cycle.

1.4.2. Objectives and Approach. PS-BCA objectives and approach are determined by the point

at which they are accomplished within the program’s life cycle.

1.4.2.1. Prior to MS-A and MS-B. Department of Defense Instruction (DoDI) 5000.02

states a BCA will be included as an annex to the LCSP. While there are challenges to

completing a BCA early in the acquisition life cycle due to the lack of data and system

information available, DoDI 5000.02 directs a BCA to be accomplished in support of the

MS-A decision. This BCA includes “the assumptions, constraints, and analysis used to

develop the product support strategy documented in the LCSP.” This comprises the BCA

scope and methodology, laying the groundwork for product support management and

integration, supply chain management, and maintenance planning. Defining these areas

early provides the framework to assess options for potential future COAs and solidifies the

methodology for conducting the PS-BCA. PS-BCAs prior to MS-A and B may be limited

in depth and detail when compared to a PS-BCA at MS-C and later.

1.4.2.2. Between MS-B and MS-C. A PS-BCA that fully examines the system’s PSS

should be completed prior to MS-C using a best value approach for PSS development that

addresses each IPS element. A “revalidation” of previous PS-BCAs is statutorily required

if five years or more will span between milestones. The revalidation should confirm the

strategy is progressing and update the data and analytical results.

1.4.2.3. Post MS-C. A PS-BCA requires revalidating/updating prior to any proposed

change in the PSS or at a minimum every five years. Follow the decision tree in section

1.3.1 to determine if a program should accomplish a PS-BCA if a PS-BCA has not been

accomplished previously. The same level of analysis may not be required in all cases for

a Post MS-C PS-BCA. If the situation allows, a PS-BCA may only require “revalidation”

12 DAFPAM63-123 14 APRIL 2022

of the previous analysis, by confirming the strategy is progressing and updating the data

and analytical results. Note: Programs that are post MS-C prior to the enactment of 10

USC §2337, Life-Cycle Management and Product Support, did not have the legislated

requirement to develop a PS-BCA prior to

MS- C. As a result, they are not required to perform a PS-BCA as part of their 5-year

revalidation. A PS-BCA is still required when determining a change to the PSS.

1.4.2.4. The level of detail in a PS-BCA differs according to where the program is in the

life cycle, as shown in Figure 1.3:

Figure 1.3. PS-BCA Schedule Throughout the Life Cycle.

1.4.2.5. Given the product support COAs may evolve as the life cycle progresses, there is

no standard set of support COAs for a PS-BCA. Best value product support approach may

include some mix of organic (e.g., government) and contractor support, as well as Public-

Private Partnerships (PPP). DoD Public-Private Partnering (PPP) for Product Support

Guidebook provides greater fidelity on PPP. The potential COAs should materialize

through the execution of the PS-BCA process. The merits of various sourcing and

partnering options should be identified as system support capabilities are analyzed across

the IPS elements and various support COAs are weighted against desired support

requirements and objectives.

1.4.2.6. The PS-BCA decision tree in section 1.4.3.1 is designed to assist the PSM in

determining what actions are required with respect to either developing a PS-BCA or

revalidating/updating the previously completed PS-BCA. At each step within the process

the narrative addresses the requirements and expected objectives. Revalidating/updating

the PS-BCA does not mean completely redoing the PS-BCA every five years. As the PSM

works through each step, the decision tree process assists in determining the requirements

DAFPAM63-123 14 APRIL 2022 13

(i.e., Memorandum for Record (MFR) to document findings or update previous PS-BCA)

and outputs.

1.4.3. PS-BCA Decision Tree

1.4.3.1. Step 1: PS-BCA been previously completed for THIS program?

Figure 1.4. Step #1 of the PS-BCA Decision Tree.

Table 1.1. Step #1 Decision Tree Process Flow.

Step

What Happens

❶ PS-BCA BEEN PREVISOULY COMPLETED FOR THIS PROGRAM?

Establish if a PS-BCA was previously completed. If a PS-BCA was completed,

consider this effort an update. Utilize the previously completed PS-BCA as the

starting point.

If Yes (Previous PS-BCA completed)

If No (No previous PS-BCA)

Continue to “Step (2) 5-year

Revalidation or Strategy Change”

Continue to “(A) PMO Considering PSS

Change”

Determine if the PMO is considering a change to the existing Product Support

Strategy

If Yes (Change to PSS Change)

If No (No change to PSS)

14 DAFPAM63-123 14 APRIL 2022

Step

What Happens

Continue to “(C) Complete PS-BCA

Continue to “(B) Program has received

MS-C approval from MDA?

Determine if program has received MS-C approval?

If Yes (Program has received MS-C from

MDA?)

If No (Program does not have MS-C

approval from MDA)

Continue to “(D) Is current PSS

affordable & effective?

Continue to “(C) Complete PS-BCA

Complete PS-BCA

Complete a PS-BCA in accordance with the following guidance:

AF PS-BCA Pamphlet

AFI 65-501

AFMAN 65-610

DoD PS-BCA Guidebook

Continue to Activity (F)

Establish if current PSS is within expected costs and metrics are achieving warfighter

requirements.

If Yes (PSS achieving goals)

If No (PSS not achieving goals)

Continue to “(E) MFR to MDA /

Document in LCSP”

Return to Activity “(C) and complete PS-

BCA”

MFR to MDA / Document in LCSP

Prepare a memo for the record that documents the results of the analysis performed.

Memo for record includes rationale for the assessment of affordability and

effectiveness of the program. This documentation should be included in an annex

within the LCSP. MDA documentation and updates should be annexed within LCSP.

Attachment 2 provides a sample Legacy Program PS-BCA Sufficiency Memo.

Process ends after this step.

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the recommended

solution and why it is recommended. Make reference to the other COAs and how

they compare to the recommended COA in costs, benefits, and risks. The

recommendation should be specific, comprehensive, measurable, consistent, accurate,

timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation serves

as an archive, and combined with the PS-BCA, provides the baseline for the next

iteration of the PS-BCA. The MDA decision provides closure to the process and

initiates the transition to the selected PSS. MDA documentation (MFR to MDA) and

updates should be annexed within LCSP.

Process ends after this step.

1.4.3.2. Step 2: 5-year Revalidation or Strategy Change

DAFPAM63-123 14 APRIL 2022 15

Figure 1.5. Step #2 of the PS-BCA Decision Tree.

Table 1.2. Step #2 Decision Tree Process Flow.

Step

What Happens

❷ 5-YEAR REVALIDATION or STRATEGY CHANGE?

If a PS-BCA was completed previously, determine the reason for updating the PS-

BCA. There are generally two reasons to update a PS-BCA: 1) five years have

lapsed since the most recent PS-BCA was accomplished or 2) there is a change in the

PSS.

If 5-Year Revalidation

If a Strategy Change

Continue to “Step 3) Is previous PS-

BCA approved & implementation on

track?”

Continue to “(H) Perform assessment;

outcome change?”

16 DAFPAM63-123 14 APRIL 2022

Perform assessment; outcome change?

Determine how changing the PSS impacts the previous PS-BCA, by determining

what changed and then assess how the changes impact costs, benefits, and risks.

Next, assess if the changes would lead to a different recommendation. This can be

done in a variety of ways, one of which is to determine how much the previous

results would have to change in order for the recommendation to change. Then

determine if the current changes fall within those bounds. This is equivalent to

performing a sensitivity analysis on the prior PS-BCA.

If Yes (Change in outcome)

If No (No change in outcome)

Continue to “(I) Update Previous PS-

BCA”

Continue to “(E) MFR to MDA /

Document in LCSP”

Update Previous PS-BCA

Update the previous PS-BCA using the most current data available. Since the

outcome has changed, this should require reviewing all areas within the PS-BCA

(i.e., costs, benefits, and risks). Incorporate any new information (e.g., extension of

the service life since the last PS-BCA) that has come available since the previous PS-

BCA was completed and update ground rules and assumptions as appropriate.

Continue to activity (F)

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the

recommended solution and why it is recommended. Make reference to the other

COAs and how they compare to the recommended COA in costs, benefits, and risks.

The recommendation should be specific, comprehensive, measurable, consistent,

accurate, timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation

serves as an archive, and combined with the PS-BCA, provides the baseline for the

next iteration of the PS-BCA. The MDA decision provides closure to the process

and initiates the transition to the selected PSS. MDA documentation (MFR to MDA)

and updates should be annexed within LCSP.

Process ends after this step.

MFR to MDA / Document in LCSP

Prepare a memo for the record that documents the results of the analysis performed.

Memo for record includes rationale for the assessment of affordability and

effectiveness of the program. This documentation should be included in an annex

within the LCSP. MDA documentation and updates should be annexed within LCSP.

Attachment 2 provides a sample Legacy Program PS-BCA Sufficiency Memo.

Process ends after this step.

1.4.3.3. Step 3: Was the Recommendation Implemented?

DAFPAM63-123 14 APRIL 2022 17

Figure 1.6. Step #3 of the PS-BCA Decision Tree.

Table 1.3. Step #3 Decision Tree Process Flow.

Step

What Happens

❸ WAS THE RECOMMENDTION IMPLEMENTED?

If five years has passed since the latest PS-BCA was completed, an update is

required. Updating the PS-BCA does not mean the PS-BCA should be completely

redone. Decide first if the PS-BCA recommendation was implemented or is being

implemented.

If Yes (Recommendation was

implemented)

If No (Recommendation not

implemented)

Continue to “Step 4) Is the Solution

Meeting Program Objectives?”

Continue to “(J) Identify & document

changes and causes for non-

implementation”

18 DAFPAM63-123 14 APRIL 2022

Step

What Happens

Identify & document changes and causes for non-implementation

Assess and document the reasons why the recommendation was not implemented.

Those reasons could include lack of funding, changes in the political environment,

programmatic changes, inability to obtain required technical data, etc. If the

implementation date slipped, update the implementation plan accordingly and

document the reason for the slippage. Once the reason for non-implementation is

identified and documented, an assessment should be performed to determine if the

recommendation is still valid. If the recommendation is no longer valid, update the

previous PS-BCA in order to determine the appropriate PSS based on current ground

rules, assumptions, program environment and current data.

Continue to activity (I)

Update Previous PS-BCA

Update the previous PS-BCA using the most current data available. Since the

outcome has changed, this should require reviewing all areas within the PS-BCA

(i.e., costs, benefits, and risks). Incorporate any new information (e.g., extension of

the service life since the last PS-BCA) that has come available since the previous PS-

BCA was completed and update ground rules and assumptions as appropriate.

Continue to activity (F)

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the

recommended solution and why it is recommended. Make reference to the other

COAs and how they compare to the recommended COA in costs, benefits, and risks.

The recommendation should be specific, comprehensive, measurable, consistent,

accurate, timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation

serves as an archive, and combined with the PS-BCA, provides the baseline for the

next iteration of the PS-BCA. The MDA decision provides closure to the process

and initiates the transition to the selected PSS. MDA documentation (MFR to MDA)

and updates should be annexed within LCSP.

Process ends after this step.

1.4.3.4. Step 4: Is the Solution Meeting Program Objectives?

DAFPAM63-123 14 APRIL 2022 19

Figure 1.7. Step #4 of the PS-BCA Decision Tree.

Table 1.4. Step #4 Decision Tree Process Flow.

Step

What Happens

❹ IS SOLUTION MEETING OBJECTIVE?

Assuming the recommendation was implemented, determine if the solution is meeting

the objectives as stated in the PS-BCA.

If Yes (Solution is meeting objective)

If No (Solution is not meeting objective)

Continue to “Step 5) Major Change in

Program Ground Rules and Assumptions

(GR&A) or Program Environment?”

Continue to “(J) Identify & document

changes and causes for non-performance”

20 DAFPAM63-123 14 APRIL 2022

Step

What Happens

Identify & document changes and causes for non-performance

Identify and document the reasons why the solution is not meeting the objectives set

forth in the PS-BCA. An example could be that a single work stream is not

performing as projected (e.g., maintenance organizations not meeting flow days,

supply organizations inability to fill customer requisitions in a timely manner or cost

increases have caused budgetary impacts to the program).

Continue to Activity (I)

Update Previous PS-BCA

Update the previous PS-BCA using the most current data available. Since the

outcome has changed, this should require reviewing all areas within the PS-BCA (i.e.,

costs, benefits, and risks). Incorporate any new information (e.g., extension of the

service life since the last PS-BCA) that has come available since the previous PS-

BCA was completed and update ground rules and assumptions as appropriate.

Continue to activity (F)

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the recommended

solution and why it is recommended. Make reference to the other COAs and how

they compare to the recommended COA in costs, benefits, and risks. The

recommendation should be specific, comprehensive, measurable, consistent, accurate,

timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation serves

as an archive, and combined with the PS-BCA, provides the baseline for the next

iteration of the PS-BCA. The MDA decision provides closure to the process and

initiates the transition to the selected PSS. MDA documentation (MFR to MDA) and

updates should be annexed within LCSP.

Process ends after this step.

1.4.3.5. Step 5: Major Change in Program GR&A or Program Environment?

DAFPAM63-123 14 APRIL 2022 21

Figure 1.8. Step #5 of the PS-BCA Decision Tree.

Table 1.5. Step #5 Decision Tree Process Flow.

Step

What Happens

❺ MAJOR CHANGE IN PROGRAM GR&A / PROGRAM ENVIRONMENT?

Assuming the solution is meeting the objective, assess if the PS-BCA GR&As and/or

operating environment have changed.

If Yes (GR&A or environment

changed)

If No (GR&A or environment not

changed)

Continue to “(K) Update GR&A”

Continue to “Step 6) Review Input; More

Current Data Available?”

22 DAFPAM63-123 14 APRIL 2022

Step

What Happens

❺ MAJOR CHANGE IN PROGRAM GR&A / PROGRAM ENVIRONMENT?

Update GR&A

To determine how changes in the GR&A and/or program environment impact the

PS-BCA, review the existing PS-BCA GR&A. The Integrated Project Team (IPT)

should document any changes to the GR&A and/or program environment. If new

information is available that would drive additional GR&As that were not previously

captured, those would be included in the update.

Continue to activity (L)

Perform assessment; outcome change?

Identify if and how those changes/additions in the GR&A and/or program

environment affect costs, benefits, and risks. Determine if the recommendation

would change based on the updated information. There are several methods that can

be used, however, the method used and results should be documented. No one

method is prescribed, but the method and logic used should be thoroughly

documented to the degree that it is repeatable.

If Yes (Change in outcome)

If No (No change in outcome)

Continue to “(I) Update PS-BCA”

Continue to “(E) MFR to MDA”

Update Previous PS-BCA

Update the PS-BCA to reflect the revised GR&A and/or program environment.

Update the previous PS-BCA using the most current data available. Since the

outcome has changed, this should require reviewing all areas within the PS-BCA

(i.e., costs, benefits, and risks). Incorporate any new information (e.g., extension of

the service life since the last PS-BCA) that has come available since the previous PS-

BCA was completed and update ground rules and assumptions as appropriate.

Continue to activity (F)

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the

recommended solution and why it is recommended. Make reference to the other

COAs and how they compare to the recommended COA in costs, benefits, and risks.

The recommendation should be specific, comprehensive, measurable, consistent,

accurate, timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation

serves as an archive, and combined with the PS-BCA, provides the baseline for the

next iteration of the PS-BCA. The MDA decision provides closure to the process

and initiates the transition to the selected PSS. MDA documentation (MFR to MDA)

and updates should be annexed within LCSP.

Process ends after this step.

DAFPAM63-123 14 APRIL 2022 23

Step

What Happens

❺ MAJOR CHANGE IN PROGRAM GR&A / PROGRAM ENVIRONMENT?

MFR to MDA / Document in LCSP

Prepare a memo for the record that documents the results of the analysis performed.

Memo for record includes rationale for the assessment of affordability and

effectiveness of the program. This documentation should be included in an annex

within the LCSP. MDA documentation and updates should be annexed within LCSP.

Attachment 2 provides a sample Legacy Program PS-BCA Sufficiency Memo.

Process ends after this step.

1.4.3.6. Step 6: Review Input; More Current Data Available?

Figure 1.9. Step #6 of the PS-BCA Decision Tree.

24 DAFPAM63-123 14 APRIL 2022

Table 1.6. Step #6 Decision Tree Process Flow.

Step

What Happens

❻ REVIEW INPUT; MORE CURRENT DATA AVAILABLE?

Assuming there are no major changes in program GR&A and/or program

environment, review the data used within the PS-BCA and update to reflect the most

current data available.

If Yes (More current data available)

If No (Data is current)

Continue to “(M) Outcome changes?”

Continue to “(E) MFR to MDA”

Outcome changes?

Identify if and how the more current data will affect costs, benefits, and risks.

Determine if the recommendation would change based on the updated information.

There are several methods that can be used, however, the method used and results

should be documented. No one method is prescribed but the method and logic used

will be thoroughly documented to the degree that it is repeatable.

If Yes (Change in outcome)

If No (No change in outcome)

Continue to “(I) Update PS-BCA”

Continue to “(E) MFR to MDA”

Update PS-BCA

Update the PS-BCA using the most current data available. As the system progresses

through the life cycle, additional data will become available. If the previous PS-

BCA was based predominately on analogous systems, the update should replace

analogous data with actual data. Since the outcome has changed, this should require

reviewing all areas within the PS-BCA (i.e., costs, benefits, and risks). Incorporate

any new information (e.g., extension of the service life since the last PS-BCA) that

has come available since the previous PS-BCA was completed and update ground

rules and assumptions as appropriate.

Continue to activity (F)

Develop Recommendation

Summarize the findings in a clear and concise manner that explains the

recommended solution and why it is recommended. Make reference to the other

COAs and how they compare to the recommended COA in costs, benefits, and risks.

The recommendation should be specific, comprehensive, measurable, consistent,

accurate, timely, unbiased, and achievable.

Continue to activity (G)

Program MDA Decision Point

Present the recommendation to the MDA for approval. The MDA should document

the rationale for the PS-BCA final decision. This final decision documentation

serves as an archive, and combined with the PS-BCA, provides the baseline for the

next iteration of the PS-BCA. The MDA decision provides closure to the process

and initiates the transition to the selected PSS. MDA documentation (MFR to MDA)

and updates should be annexed within LCSP.

Process ends after this step.

DAFPAM63-123 14 APRIL 2022 25

Step

What Happens

❻ REVIEW INPUT; MORE CURRENT DATA AVAILABLE?

MFR to MDA / Document in LCSP

Prepare a memo for the record that documents the results of the analysis performed.

This include rationale includes assessment of affordability and effectiveness of the

program. This documentation should be included in an annex within the LCSP.

MDA documentation and updates should be annexed within LCSP. Attachment 2

provides a sample Legacy Program PS-BCA Sufficiency Memo. Process ends after

this step.

Process ends after this step.

1.5. PS-BCA Process Overview.

1.5.1. PS-BCA Process Map. The PS-BCA process map shown in Figure 1.10 assists the

PMO in identifying the individual steps of the PS-BCA process. Greater fidelity of the PS-

BCA process is described in Attachment 3.

Figure 1.10. PS-BCA Process Map.

26 DAFPAM63-123 14 APRIL 2022

Chapter 2

ROLES AND RESPONSIBILITIES

2.1. PS-BCA IPT Members. Developing a PS-BCA represents a major effort that involves

comparing a variety of COAs in order to support major resource decisions in an effort to obtain

the best value for the product support strategy. Given the scope, scale, and complexity involved,

participation is required from a number of stakeholders (to include the warfighter), support subject

matter experts (SMEs), and advisors. The consolidated participants are led by the PSM and are

referred to as the PS-BCA IPT. The IPT should include major command/Field Command

(MAJCOM/FIELDCOM), Headquarters Air Force (HAF) and United States Space Force (USSF)

representatives. Additional information on the roles, responsibilities, and functions of the PS-

BCA IPT are located in paragraph 2.5.

2.2. Approval Level. The approver of the PS-BCA is the MDA. Depending on the scope and

sensitivity of the decision, the MDA can be the Under Secretary of Defense for Acquisition,

Technology and Logistics (USD (A&S)), Head of the DoD Service Component, Service

Acquisition Executive (SAE), or Program Executive Officer (PEO). Additionally, the MDA can

delegate the responsibility to make the PS-BCA final decision as outlined in section 2.3 and

maintain compliance with AFI 65-501 and AFMAN 65-506.

2.3. Milestone Decision Authority (MDA). The MDA has overall responsibility for the

acquisition program. The MDA has the authority to approve the entry of an acquisition program

into the next phase of the acquisition process and is accountable to authorities such as Congress

for costs, schedule, and performance. The MDA is based on ACAT levels as listed below:

ACAT ID and ACAT IAM: USD (A&S) or as delegated.

ACAT IC and ACAT IAC: Head of the DoD Service Component or, if delegated, the

SAE (not further delegable).

ACAT II: SAE or the individual designated by the SAE.

ACAT III: Designated by the SAE. This category includes Automated Information

System (AIS) programs that do not meet the criteria for MAIS programs.

2.3.1. Under Secretary of Defense for Acquisition, Technology and Logistics (USD (A&S)).

The USD (A&S) is responsible for supervising the Defense Acquisition System. The USD

(A&S) is the principal staff assistant and advisor to the Secretary of Defense and the Deputy

Secretary of Defense for all matters concerning acquisition.

2.3.2. United States Air Force Service Acquisition Executive (SAE). The USAF SAE, also

known as the Component Acquisition Executive (CAE), is responsible for all Air Force

research, development, and acquisition activities in accordance with DoDI 5000 series

directives. This executive provides direction, guidance, and supervision of all matters

pertaining to the formulation, review, approval and execution of acquisition plans, policies and

programs. The SAE can serve as the MDA on ACAT IC programs, if delegated, and

recommends decisions on ACAT ID programs. The SAE represents the Air Force to USD

(A&S) and Congress on all matters relating to acquisition policy and programs.

2.3.3. Program Executive Officer (PEO). The PEO is responsible for cost, schedule and

performance in an acquisition program and/or portfolio. Additionally, the PEO ensures PMs

are coordinating with appropriate stakeholders and representatives to develop capabilities

DAFPAM63-123 14 APRIL 2022 27

based requirements, technical level architectures, integrated test plans, technology transition

plans, product support strategies, and acquisition strategies throughout the entire life cycle.

The PEO validates the PMs’ recommendations and implementation plans. Validation answers

the question, “Is it the right solution to the problem?” A PEO is typically delegated as the

ACAT II and III MDA for programs in their portfolios. The PEO may delegate ACAT III

MDA authorities to any appropriately qualified individual(s). In addition, the PEO, or their

delegate, chairs the Executive Level Incremental Approval Point (IAP) sessions.

2.4. Governance Structure. For ACAT I (MDAP or MAIS) and selected Office of the Secretary

of Defense (OSD) programs, the coordination/approval structure depicted in Figure 2.1 below

should be followed during the development, review, and approval of the PS-BCA. The PMO is

responsible for identifying a coordination approval structure for the PS-BCA that is commensurate

with the ACAT level of the program. The PMO may leverage existing boards or steering groups

or utilize an existing MDA chain as final review and approval authority for the the PS-BCA. Prior

to the PS-BCA kick-off meeting, the PMO also identifies organizations (i.e., recommended

stakeholders) that should participate in the IAP steps to ensure enterprise level requirements are

addressed. In addition, IAP reviews should be leveraged to ensure “buy-in” throughout the PS-

BCA development process.

2.4.1. PS-BCA Engagement. The following section provides the PS-BCA team insight to

ensure a wide range of diverse perspectives prior to and in support of making major decisions.

The people and organizations representing this diversity are the foundation for governance,

validation, and approval type bodies. Figure 2.1 depicts the governance structure for

MDAP/MAIS ACAT I and special interest OSD programs. Figure 2.2 depicts the governance

structure for ACAT II & III programs.

2.4.1.1. DoD Policy: An acquisition program is categorized based on the criteria in DoDI

5000.02. All defense acquisition programs are designated by an ACAT (i.e., I through III)

and type (e.g., MDAP, MAIS, or Major System). Once an ACAT is established, it remains

throughout the lifecycle of the program. Once sub-programs are incorporated into system

level, all expenditures are included into the higher level system.

2.4.1.2. For ACAT I (MDAP or MAIS) and selected OSD programs, the governance

structures depicted in the Figure 2.1 should be utilized by the PMO during the

development, validation, and approval of the PS-BCA.

2.4.1.3. For ACAT II/III programs, the coordination/approval structure depicted in Figure

2.2 below should be followed during the development, review, and approval of the PS-

BCA.

28 DAFPAM63-123 14 APRIL 2022

Figure 2.1. MDAP/MAIS ACAT I and Special Interest OSD Programs.

DAFPAM63-123 14 APRIL 2022 29

Figure 2.2. ACAT II and III Programs.

2.4.2. Defense Acquisition Board (DAB). The Defense Acquisition Board (DAB) is the senior

advisory board for the DoD acquisition system and provides advice on critical acquisition

decisions. The board is chaired by the USD (A&S) and includes the Vice Chairman of the

Joint Chiefs of Staff, the Service Secretaries, and a number of Under Secretaries of Defense.

Members of the DAB are responsible for approving MDAPs and serve as the most important

executive review of expensive acquisition projects in the DoD. The DAB is also the principal

review forum enabling USD (A&S) to fulfill 10 USC Chapter 144 responsibilities concerning

ACAT I programs.

2.4.2.1. Best Practice: Presenting/coordinating the PS-BCA recommendation to the

appropriate stakeholders/advisors and within the chain of command is the responsibility of

the PMO. While not technically in the PM-PEO-MDA chain of command, it is

recommended for all ACAT IC/D and ACAT IAC/AM programs to ensure product support

validation within sustainment command centers prior to making recommendation to the

SAE. (e.g., Programs within Air Force Materiel Command (AFMC) should ensure Air

Force Sustainment Center (AFSC) / Air Force Life Cycle Management Center (AFLCMC)

30 DAFPAM63-123 14 APRIL 2022

Air Force Nuclear Weapons Center (AFNWC) commanders are presented with the PS-

BCA recommendation.) Coordinate ACAT IC programs with SAF/FMC per AFI 65-501.

2.4.3. Assistant Secretary of the Air Force (Acquisition) (SAF/AQ). The SAF/AQ has the

authority, responsibility and accountability for all Air Force acquisition programs and for

enforcement of USD (A&S) procedures. The SAF/AQ may choose to enact a decision based

on their inherent knowledge of a program for ACAT IC, ACAT IAC, and ACAT II programs

(if not delegated).

2.4.4. Incremental Approval Points (IAPs). IAPs are vector checks designed to provide

directional guidance and concurrence throughout the process on such matters as the scope,

GR&A, evaluation criteria, problem statement, COA selection, data sources, risk mitigation

strategies, and all other critical factors contained within the PS-BCA. IAPs ensure the PS-

BCA strategy integrates an enterprise wide perspective. IAPs help identify and gain

concurrence on key GR&As, constraints, and most notably the weighting and scoring

methodology. IAP members are determined by the impact and level of the decisions being

made, as well as the PSM’s chain of command.

2.4.5. IAP Frequency. There is no limit for the number of IAPs during development of the PS-

BCA. Discretion as to how many IAPs to conduct is left to the PSM. The PSM needs to ensure

all aspects of the PS-BCA are well communicated and shared with appropriate stakeholders,

SMEs, and advisors. The PSM should have this governance body in mind when developing

the PS-BCA. These periodic meetings, and/or coordination activities, should ensure that no

stakeholder or approval authority is surprised by the final PS-BCA recommendation.

2.4.5.1. Executive (GO/SES) Level Incremental Approval Point. The Executive General

Officer/Senior Executive Service (GO/SES) level IAP includes multi-functional senior

executives who provide an enterprise perspective to enhance decision making for the

MDA. The Executive IAP members provide senior level review balancing requirements,

resources, priorities, and mandates. Executive IAP members also provide guidance to the

acquisition execution chain from an integrated and enterprise perspective. This includes

providing insight and ensuring statutory and regulatory compliance and providing support

to the PS-BCA team as requested. The PEO may choose to utilize existing command 1-

Star governance boards or virtually coordinate with the Executive IAP members.

Executive IAP members include, as applicable:

2.4.5.1.1. PEO

2.4.5.1.2. Directorate of Logistics and Product Support (SAF/AQD)

2.4.5.1.3. Directorate of Information Dominance (SAF/AQI)

2.4.5.1.4. Directorate of Global Power (SAF/AQP)

2.4.5.1.5. Directorate of Global Reach (SAF/AQQ)

2.4.5.1.6. Directorate of Cost and Economics (SAF/FMC)

2.4.5.1.7. MAJCOM A4 A5/8/9 Engineering (EN), Contracting (PK), Financial

Management (FM) (or USSF equivalent)

DAFPAM63-123 14 APRIL 2022 31

2.4.5.1.8. Center LG (Space Systems Command (SSC)/Air Force Life Cycle

Management Center (AFLCMC)/Air Force Nuclear Weapons Center (AFNWC)/Air

Force Sustainment Center (AFSC))

2.4.5.1.9. Space Systems Command (SSC)/Space Logistics Directorate (S4)

2.4.5.1.10. Others as required by PEO

2.4.5.2. O-6/GS-15 Level Incremental Approval Point. The multi-functional O-6/GS-15

IAP reviews the GR&A, constraints, and weighting/scoring criteria and advises on the

authoritative data sources used by the PS-BCA IPT to conduct the financial and non-

financial analysis. The criteria for the authoritative data source should be: accurate,

comprehensive, consistent, timely, available, and accepted. This approval step may occur

numerous times in the course of the PS-BCA process as data sources are revealed as

determined by the PM. The O-6/GS-15 IAP members include, as applicable:

2.4.5.2.1. PM

2.4.5.2.2. MAJCOM A4 A5/8/9 Engineering (EN), Contracting (PK), Financial

Management (FM) (others as required)

2.4.5.2.3. Center LG (SSC/AFLCMC/AFNWC/AFSC)

2.4.5.2.4. End-User

2.4.5.2.5. Others as required by the PM

2.4.5.2.6. SAF/AQD (Only ACAT I / Select OSD Programs)

2.4.5.2.7. SAF/AQ (I, P,Q) (Only ACAT I / Select OSD Programs)

2.4.5.2.8. SAF/FMC (Only ACAT I / All OSD Programs)

2.5. PS-BCA IPT Roles, Responsibilities, and Functions. The following section provides

guidance on assembling a PS-BCA IPT. The section addresses involving the right stakeholders,

support SMEs, and advisors at the kickoff meeting and assembling the governance structures. A

PS-BCA is a team effort undertaken by experienced participants across a wide range of specialties.

From the initial stages of accomplishing the background research and gathering the data, through

the final stages of staffing a PS-BCA for senior decision makers, completing an effective PS-BCA

requires significant effort by all those involved.

2.5.1. PS-BCA IPT Structure. Product support encompasses a range of disciplines including,

but not limited to, logistics, requirements, operational mission planning, financial

management, contracts, legal, and integrated product support elements. The structure of the

PS-BCA IPT varies depending on the maturity and the mission of the program. The PSM

should be cognizant of where the program is in the life cycle, understand the major

milestones/events, and provide useful information to the decision makers for the program to

move successfully forward through the life cycle. The team should leverage the cross-

functional expertise of its members to ensure all support COAs are considered and the best

value PSS is selected.

2.5.2. PS-BCA IPT Characteristics. PSS are comprehensive and require early and frequent

discussion and planning efforts across and between all key stakeholders and advisors. An

effective PS-BCA IPT has these characteristics:

32 DAFPAM63-123 14 APRIL 2022

All functional disciplines influencing the weapon system throughout its lifetime are

represented.

All the members buy into the team's goals, plans of actions and milestones,

responsibilities, and authorities.

All staffing, funding, and facilities requirements are identified and resourced.

2.5.3. PS-BCA Role and Responsibilities. The following sections describe roles and

responsibilities of key IPT members that may be involved in the PS-BCA depending on the

program’s life cycle phase. The PMO should maintain an IPT membership plan which should

use all of the information collected to lead IPT membership. The IPT membership plan is a

key component of executing and completing a successful PS-BCA. A large portion of IPT

management focus is on communication. The cornerstone of stakeholder and advisor

management is understanding who needs what information and when or how often they need

it. The PS-BCA process map (see Figure 1.10) incorporates relationships between activities

and functional units. This diagram focuses on the logical relationship of the value activities

and shows opportunities for open dialogue across multiple levels. The various stakeholders

representing organizations, SMEs, advisors, approval authorities, etc. should all work together

from the initial development of the problem statement through the final PS-BCA report

incorporating the MDA decision and attaching the PS-BCA to the LCSP.

2.5.3.1. Program Management Office (PMO). The PMO staff assists the PM and PSM in

developing the PS-BCA. Within the PMO, the PSM is responsible for planning,

developing, implementing, and executing the PSS, informed by the PS-BCA. Each

member of the PMO staff should actively participate in the PS-BCA kickoff meeting and

in developing the scope, GR&As, and problem statement. PS-BCA roles and

responsibilities should generally remain consistent regardless of whether the role is

performed by a government employee or a contractor, but ultimately the PMO staff is

responsible for the content and PS-BCA deliverables.

2.5.3.1.1. The PMO staff should determine what individuals or groups can influence

and affect the PS-BCA or be affected by its performance and outcome. IPT member

identification is the process used to identify all stakeholders, SME support, and

advisors for a PS-BCA. It is important to understand that not all IPT members have

the same influence or effect on a PS-BCA, nor will they be affected in the same manner.

There are many ways to identify IPT members, however, it should be done in a

methodical and logical way to ensure that IPT members are not easily omitted. The

selection process may be done by looking at IPT members organizationally,

geographically, or by involvement with various phases or objectives. Another way of

determining IPT members is to identify those who are directly impacted by the PS-

BCA and those who may be indirectly affected. Examples of directly impacted IPT

members are the project team members or the MAJCOM who directed the PS-BCA is

being done for. Those indirectly affected may include an adjacent organization or

members on the local community. Directly affected IPT members should usually have

greater influence and impact of the PS-BCA than those indirectly affected.

2.5.3.1.2. Support contractors (extension of the PMO) may participate in the PS-BCA

IPT, but they cannot commit the PMO they support to a specific position. The PMO is

responsible for ensuring support contractors are employed in ways that do not create

the potential for a conflict of interest. Contractor support staff may participate in PS-

DAFPAM63-123 14 APRIL 2022 33

BCA IPT discussions, however, they are not permitted to represent the position of the

supported organization and it is recommended they be asked to sign non-disclosure

agreements prior to deliberations. The PMO should consult with the legal advisor to

determine whether an organizational conflict of interest exists.

2.5.3.2. Program Manager (PM). The owner of the PS-BCA is the PM and he/she is the

primary initiator of the actions and recommendations derived out of the PS-BCA. The PM

also obtains the resources necessary for accomplishing the PS-BCA.

2.5.3.3. Product Support Manager (PSM). While the PSM reports directly to the PM,

he/she has statutory responsibility, per 10 USC §2337, to lead the PS-BCA. This includes

overseeing the team that is conducting and writing the PS-BCA. The OSD PSM guidebook

and the DoD PS-BCA guidebook can assist the PSM in defining the roles and

responsibilities of the team members. PSMs are also responsible for managing support

functions required to field and maintain the readiness and operational capability of major

weapon systems, subsystems, and components. Ultimately, the PSM serves as the overall

lead for the development of the PS-BCA:

Responsible for assembling the governance structure, appropriate board members,

stakeholders, support SMEs and advisors

Identify PS-BCA IPT members (to include Contractors, Original Equipment

Manufacturers (OEMs), depot/operations/logistical units)

Key player in the problem statement development and approval

Provides insight on support strategy and integration of the IPSEs.

Key player on development of COAs and identification of data sources

2.5.3.4. Data Manager. One of the primary responsibilities of the data manager is

maintaining and keeping historical records of PS-BCAs. These records include research,

performance outcomes, cost estimates and methodology, and sources of data. Effective

configuration management of acquisition documents supports the decision making

processes by allowing decision makers to have information available throughout the

present and future PS-BCA process. The functions a data manager performs can be

accomplished utilizing existing resources. Some members of the PS-BCA may perform

multiple roles and responsibilities.

2.5.3.5. Cost Analyst. The cost analyst has the training and skills to develop the

financial/cost analysis section, the analytical methodology for the PS-BCA, and

comparative analysis of both quantitative and qualitative factors for each COA. The cost

analyst works with the budget analyst who analyzes historical funding and develops the

budget plan with regards to the recommended PS-BCA approach. The cost analyst

prepares and organizes the PS-BCA cost estimate in accordance with (IAW) applicable

AFI, AFMANs, OSD, and Office of Management & Budget (OMB) guidance, actively

participates in the formation of the cost scope and baseline, and performs PS-BCA

calculations to include life cycle cost estimates, benefit analyses, risk assessments,

affordability, and sensitivity analyses. The cost analysis is a primary duty of the PS-BCA

IPT and highlights the cost differences between support or sustainment strategies. PS-

BCA cost analysts should follow the cost estimating guidance outlined in the DoD “Cost

Assessment and Program Evaluation (CAPE) Operating and Support Cost Estimating

Guide (September 2020).”

34 DAFPAM63-123 14 APRIL 2022

2.5.3.6. Logistician (Requirements, Logistics, and Supportability Manager). The

logistician is responsible for ensuring the sustainment strategy, requirements, and

performance measures are in the PS-BCA. The logistician also provides COA specifics

and ensures sustainment requirements are comprehensively met. Additionally, this person

is responsible for completing the mission impact section, including the non-financial

analysis of the PS-BCA as well as collecting and calculating system/program logistics

metrics such as failure projections, operating hours and sparing requirements. The PMO

may have to obtain Space Operations Command (SpOC), Headquarters Air Force Materiel

Command (HQ AFMC) or AFSC SMEs for Supply Management, Deployment/

Distribution/Transportation, Maintenance support, and Life Cycle Logistics (LCL)

expertise.

2.5.3.7. Chief Engineer. The Chief Engineer and the PSM work together to align the

program’s strategies for systems engineering and product support so they are mutually

supportive, avoid duplication, and take advantage of available synergies. The Chief

Engineer develops COAs with the PSM and works with the PM and the PSM to select the

program’s comprehensive life cycle engineering approach.

2.5.3.8. Contract Officers/Managers. Contracting officers/managers are active IPT

members to ensure contractually viable strategies.

2.5.3.9. Stakeholders. A stakeholder is a person or group of people who can affect or be

affected by the PS-BCA. Depending on the complexity and scope of the PS-BCA, there

may be very few or an extremely large number of stakeholders. The PS-BCA lead should

look at each stakeholder to gather more in depth information in order to understand their

impact, involvement, communication requirements, and preferences. Are they a cohesive

team? Do they support this PS-BCA or are they critical of it? What is this stakeholder’s

interest in this project? These are the types of questions that should be answered in order

to provide a complete analysis.

2.5.3.10. Warfighter. PS-BCA impacts on the warfighter are the primary considerations.

The warfighter provides the performance requirements for the weapon system which are

taken into account for the PSS. The warfighter also provides feedback on the system and

PSS.

2.5.3.11. AFMC

2.5.3.11.1. AFMC/A4. PS-BCA impacts on the enterprise sustainment infrastructure

are the primary considerations of AFMC from a command perspective. AFMC ensures

statutory compliance for core, 50-50, 6% capital investments, and achieve best value

while ensuring support to the warfighter.

2.5.3.11.2. Air Force Sustainment Center Logistics Directorate (AFSC/LG).

Responsible and accountable for managing AFSC’s overall planning, resource, process

& performance execution to achieve Air Force Sustainment Center Commander

(AFSC/CC) integrated vision for a strategy focused organization. AFSC/LG has

inherent authority to oversee, integrate, standardize, and direct processes, resources,

and organizations to achieve AFSC goals and objectives.

2.5.3.12. Space Systems Command (SSC)

DAFPAM63-123 14 APRIL 2022 35

2.5.3.12.1. SpOC/S4. Responsible for PS-BCA impacts on the acquisition and

sustainment of space capabilities, including life cycle management planning,

sustainment planning and sustainment management for all assigned AF space and

missile systems.

2.5.3.12.2. Space Systems Command, Product Support Enterprise Directorate

(SSC/ECP). Responsible for acquisition and sustainment of space capabilities,

including life cycle management planning, sustainment planning and sustainment

management for all assigned AF space and missile systems. SSC/ECP is the single

focal point for life cycle management of space systems logistics and sustainment

functions for AF PEO Space delivered systems. SSC/ECP consolidates, coordinates,

and provides a single focal point for logistics/sustainment activities including cross

system integration, acquisition logistics, logistics readiness, SE, and program support

of assigned PSMs.

2.5.3.13. Subject Matter Experts (SMEs). SMEs are recognized experts with specialized

knowledge applicable to the analysis and preparation of the PS-BCA components

(logistics, engineering, contracting, budget analysis, etc.). The PS-BCA IPT should

leverage SMEs within the PMO, and from functional areas with specific expertise in the

focus area or life cycle phase of the program (e.g., software or materials or risk SMEs).

This includes other relevant members that provide inputs to and/or impact the PS-BCA

analysis. SMEs are typically found among those who have been in their roles long enough

for the knowledge and experience to be “second nature,” or in other words, they know how

to do their jobs without having to look up information. In the case of extremely complex

roles, they might have to look up information even as a SME, but they know exactly where

to find that information. Evidence of sound SMEs include – but is not limited to – the

following:

Correctly determines what levels of performance are acceptable and can identify

and clearly describe performance objectives.

Knows the order in which successful performance steps are to be performed, and

may have made recommendations for improvement that have been adopted.

Has a high degree of familiarity with the technical jargon in his/her area of

expertise.

For work that is less about performing tasks and more about mastering knowledge

required to make effective decisions or to prioritize and assign work to teams, a

SME is very familiar with the requisite knowledge that underlies effective

decision-making.

Can produce many cases that illustrate “good” versus “poor” decisions in his/her

area of expertise.

Knows how to explain his/her area of expertise clearly to others and may serve as

a coach, mentor or supervisor within his/her area of expertise.

2.5.3.14. Product Support Providers (PSPs). Organic organizations (Supply Chain

Management Groups (SCMGs), Maintenance Groups, Defense Logistics Agency, etc.)

Private Sector (Industry), and Partnership representatives may be invited to PS-BCA IPT

meetings to provide information, advice, and recommendations to the IPT, however, the

following guidelines should govern their participation:

36 DAFPAM63-123 14 APRIL 2022

PSPs should not be formal members of the PS-BCA IPT.

PSPs should not be present during IPT deliberations on acquisition strategy or

competition sensitive matters, nor during any other discussions that would give

them a marketing or competitive advantage.

At the beginning of each meeting, the IPT lead should introduce each PSP

representative, including their affiliation, and their purpose for attending.

The PS-BCA lead should inform IPT members of the need to restrict discussions

while PSPs are in the room, and/or the IAP chair should request the

representatives to leave before matters are discussed that are inappropriate for

them to hear.

2.5.3.14.1. Best Practice: Given the sensitive nature of PS-BCA IPT discussions, PSPs

may not be permitted to participate in certain discussions. The PSM may permit PSPs

to make presentations to the PS-BCA IPT, when such views will better inform the IPT

and do not involve the PSPs directly in government decision making.

2.5.3.15. Advisors. The role of an advisor is to provide guidance and assistance to the PS-

BCA IPT. Advisors provide the IPT with an objective point of view during the decision

making process with logical and holistic context considering product support strategies.

2.5.3.16. SAF/AQD (Required). Provides enterprise oversight of all matters pertaining to

product support, Supply Chain Management (SCM), maintenance of military materiel, and

all support functions required to field and maintain the readiness and operational capability

of weapon systems, including all functions related to weapon system readiness. Supports

programs with oversight, guidance and assistance relative to product support during the

development of programmatic documentation and the execution of program reviews

throughout the life cycle. Responsible for enterprise oversight of all matters pertaining to

Air Force depots throughout the life cycle and advises the Assistant Secretary of the Air

Force (Acquisition) (SAF/AQ).

2.5.3.17. SAF/FM and/or MAJCOM FM (Required). Provides expert cost, economic,

comparative analysis, and financial decision support to the Air Force, DoD, and Congress,

thereby enhancing Air Force warfighting capabilities and maximizing available resources.

Responsible for cost analysis, budget formulation, distribution of budget and execution

oversight for base infrastructure and space weapon systems sustainment, funds control and

distribution for all appropriations and overall financial resource management, accounting

and oversight. Supports the requirements definition process, specifically in leading the

cost analysis working group for studies for satisfying warfighter requirements and

furnishing expertise for independent review, when applicable, of cost estimates produced

by other entities.

2.5.3.18. AFCAA (Required). The Air Force Cost Analysis Agency (AFCAA) provides

independent component cost analyses for major space, aircraft, and information system

programs as required by public law and DoD policy, or those of special interest. It is

responsible for cost estimating and for enhancing the state-of-the-art methodologies in cost

analysis. It provides guidance, analytical support, and quantitative cost risk analyses to 11

major commands and the Air Force corporate staff on development of cost per flying-hour

factors and resource requirements. AFCAA performs special studies supporting long-

range planning, force structure, analysis of COAs, and life-cycle cost analyses. For ACAT

DAFPAM63-123 14 APRIL 2022 37

I and special programs, AFCAA along with the Directorate of Economics and Business

Management (SAF/FMCE) perform the SAF/FMC review and coordination/certification

of products that include comparative analyses.

2.5.3.19. AFLCMC/LG or SSC/ECP or AFNWC/LG. Provides product support and life-

cycle logistics capability through functional management and training of logisticians

SMEs. Also provides hands-on assistance planning, workforce management and

development support for all logisticians. Provides an analytical capability to support PMOs

and Center leadership and integration with other AFMC Centers.

2.5.3.20. SSC/S4. Provides product support and life-cycle logistics capability through

functional management and training of logisticians and SMEs. Also provides hands-on

assistance planning, workforce management and development support for all logisticians.

Provides an analytical capability to support PMOs and Center leadership and integration

with the Space Systems Command (SSC).

2.5.3.21. AFMC A5/8/9 SSC/S5/8/9. Responsible for the requirements definition process

for core sustainment command capabilities. Responsible for operational requirements

development and oversight of the development, acquisition and fielding of new

capabilities. Assists with command-wide and functional assessments of current and future

plans, operations, logistics and sustainment requirements. Provides oversight of modeling

and simulation efforts, as well as scientific analyses and assessments.

2.5.3.22. Legal Officers/Advisors. Legal officers/advisors should be involved early and

frequently in the PS-BCA process to ensure compliance with laws and regulations, to aid

in COA analysis, and in risk identification and analysis.

38 DAFPAM63-123 14 APRIL 2022

Chapter 3

PLANNING FOR THE PRODUCT SUPPORT BUSINESS CASE ANALYSIS.

3.1. PS-BCA IPT Kickoff Meeting. The PS-BCA IPT kickoff meeting is a working level

meeting focused on providing training and guidance. Organize, Train, & Equip (OT&E)

organizations such as AFLCMC/LG, AFSC/LG, AFNWC, and SSC/ECP should provide PS-BCA

training and the PMO should provide program description and overview. The PMO works with

stakeholders and mandatory advisors to ensure the right IPT members are identified for the kickoff

meeting and provides input in preparation of the kickoff meeting. IPT members should review

and finalize the charter, draft a problem statement, develop GR&As, identify and document desired

objectives, discuss COAs, set up the structure of analysis, and review action items and way

forward.

3.2. Preparation for Kickoff Meeting. The PMO should identify appropriate stakeholders and

mandatory advisors to begin preparing for the PS-BCA IPT Kickoff Meeting as soon as practical.

This PS-BCA framework includes developing an agenda, problem statement, scope, desired

outcome(s), schedule, and the initial GR&As which become part of the PS-BCA charter. The

appropriate governance structure should eventually approve the elements of the framework.

3.2.1. Determine PMO PS-BCA Staffing Requirements. The PMO determines if the PS-BCA

will be executed entirely with organic resources or if contractors will be used to assist in the

analysis. The PMO should coordinate with Acquisition Center Logistics Directorate personnel

to obtain guidance for conducting the Product Support Business Case Analysis, to include

using government personnel to the maximum extent possible, prior to awarding contracts for

the analysis. If contractors are used, then prior to the kickoff meeting, the PMO should ensure

the contractors are contacted and required Associated Contractor Agreements are in place. It

is recommended the agreements include pre-priced extensions, if needed, to complete the final

out-brief and PS-BCA report in case there are unforeseen schedule extensions.

3.2.2. Identify PS-BCA IPT Membership. The PMO determines which organizations (defined

in Section 2: Roles and Responsibilities) are required to support the PS-BCA effort. Prior to

the PS-BCA IPT kickoff meeting, the PMO requests Point of Contact (POCs) from each

organization that will be part of the PS-BCA IPT and provides any background or relevant

program information.

3.2.3. Identify the Governance Structure and Approval Authority. The PSM should have an

established approval structure for the PS-BCA. The PSM may use existing PM/PEO/MDA

chain or establish a separate governance structure to approve a PS-BCA. The PSM may choose

to use existing boards to serve as part of the governance structure. The PSM is responsible to

contact the secretariat and coordinate the intent to use the board as part of the PS-BCA

governance. It is important that the PSM leverages the IAP to ensure the PS-BCA is fully

coordinated prior to seeking approval from the chosen PS-BCA governance structure.

3.2.4. Preliminary Assessment. Conduct preliminary assessment of potential COAs and

required data needed to support the analysis.

3.2.5. Data Collection Plan. The data collection plan will be discussed in more detail in

Section 9 (Data Selection, Collection and Assessment Plan), however, the PMO should

conduct a review of potential data sources (both organic and contractor) and identify potential

DAFPAM63-123 14 APRIL 2022 39

authoritative data sources (e.g.: LIMS-EV, AFTOC, CEMS, etc.) prior to the kickoff meeting.

If a gap in data exists, the PMO should determine if it is feasible to mitigate the gap (i.e.:

request data via Contract Data Requirements List (CDRL), establish contractual agreement, or

develop potential workaround/alternative data sources). In the event the data is not available

and no workaround exists, this gap identification should be addressed at the kickoff meeting

and may impact the development of potential COAs/metric selection processes.

3.2.6. Data Quality. By collecting useful technical and cost data early in the life-cycle,

decision makers should have the information necessary to make the best assessment possible

of the current product support plan with respect to any COA, placing the program leadership

in a better position to complete the PS-BCA requirement. Since the PS-BCA is periodically

required to be revalidated, it is in the PM’s best interest to have the highest quality data

available. As a result, the team should anticipate and plan for adequate updates to firmly

address the usual risks associated with a PS-BCA, such as a lack of platform specific historical

cost data, or a change in procurement quantity, scope, or service life.

3.2.7. Situational Awareness. Review prior product support related analyses and determine if

any additional analysis should be completed/ updated/reviewed prior to the PS-BCA kickoff

meeting (i.e.: 5-year Depot Source of Repair (DSOR) review, Independent Logistics

Assessment (ILA), Depot Activation Prioritization Model assessment, Program Office

Estimate (POE), etc.).

3.2.8. Determine Realistic Schedule. As noted previously, a PS-BCA requires significant

effort to complete and establishing an appropriate and achievable schedule is critical to mission

success. Experience has shown that schedules can be influenced by the size of the program,

the current life cycle phase of the program, whether new documentation or revalidated

documentation will be used, access to leadership, review time required by the leadership, to

name but a few.

3.3. Identify and Establish the PS-BCA IPT. The PS-BCA IPT should consist of stakeholders,

support SMEs, and advisors who have a stake or interest in the outcome of the PS-BCA.

Stakeholders represent organizations or entities that play an active role in the execution of the

program throughout the life cycle. Advisors represent organizations or entities that support either

the program or the PS-BCA process but do not play an active role in the execution of the program.

3.3.1. IPT Membership. Table 3.1 provides a list of organizations that can provide program

specific PS-BCA IPT members upon request. Request for team member participation should

be sent to the various organizations prior to the kickoff meeting.

Table 3.1. IPT Membership.

Organization

Role

Support Responsibility

PMO

Stakeholder

PS-BCA author and IPT lead (PSM)

Provides program unique data and resources

(e.g. program management, data

management, financial management, cost

analysis, logistics, systems engineering,

legal, contracting)

Supports PSM in development and execution

of the PS-BCA

40 DAFPAM63-123 14 APRIL 2022

Organization

Role

Support Responsibility

Reviews analyses

Warfighter

Stakeholder

Provides the performance requirements for

the weapon system which are taken into

account for the PSS

HQ AFMC/A4 or HQ

SpOC/S4

Stakeholder

Provides operational and supportability

requirements

Provides operational data to support analysis

Ensures statutory compliance

Develop PS-BCA implementing guidance

Function as part of incremental approval

point process

Provide expertise as requested to PEOs in

support of PS-BCA IPT functions

Provide training as required to workforce

related to PS-BCA implementation, ensure

workforce possesses knowledge, skills,

abilities, and tools necessary for PS-BCA

implementation

Collaborate with SAF/AQD, AFMC/A4,

AFIT and Defense Acquisition University as

required to develop/refine training specific

for PS-BCA implementation

AFSC/LG

Stakeholder

Responsible and accountable for reviewing

proposed COAs to ensure AFSC capabilities

are being considered and addressed

Consolidates, validates, and verifies

information and data provided by AFSC

support SMEs to PS-BCA IPT

Entry/exit point for AFSC for subject matter

expertise and specific data requests

Supply Chain

Management Wings

Support SME

Provides data as required via AFSC/LG as

required

Air Logistics Complex

Support SME

Provides data as required

DLA

Support SME

Provides data as required

Contractor/(OEM)

Support SME

Provides data as required

Partnership

Representatives

Support SME

Provides data as required

SAF/AQD

Advisor

Assists with PSS development

SAF/FMC

Advisor

Advises with PS-BCA methodology and cost

model development for ACAT I level and all

OSD programs

SSC/ECP

Advisor

Consolidates, validates, and verifies

information and data provided by AFSC

Functional Stakeholders

DAFPAM63-123 14 APRIL 2022 41

Organization

Role

Support Responsibility

Provide the latest PS-BCA guidance to all

Space programs

Archive and share samples and best practices

with PMOs

Review draft PS-BCAs and provide

comments

MAJCOM FM

Advisor

Validates all cost analysis prior to final

report coordination/briefings

AFCAA

Advisor

Provide guidance, analytical support, and

cost risk analyses for ACAT I level and all

OSD programs

AFLCMC/LG

Advisor

Enterprise level PS-BCA process lead for

their command

SpOC/S4

Advisor

Enterprise level PS-BCA process lead for

their command

AFMC A5/8/9

SpOC/S5/8/9

Advisor

Requirements definition process for core

sustainment command capabilities

Oversight of modeling and simulation

efforts, as well as scientific analyses and

assessments

3.4. Kickoff Meeting.

3.4.1. Introductions. The PSM conducts roll call and allows stakeholders, support SMEs, and

advisors to introduce themselves by name, organization and their role in the PS-BCA process.

3.4.2. Agenda Review. The PSM provides an overview of the agenda.

3.4.3. Program Overview. The PSM provides a program overview that includes a brief history

of the program, the phase within the acquisition life cycle, industry/market conditions,

significant program events, and any product support challenges or performance deficiencies

the program is experiencing. Additionally, the overview includes relevant information on

historical precedents, previous BCA or PSS attempts, acquisition documentation and

stakeholders. The overview should provide enough background to give a general

understanding of the program. This step facilitates defining the baseline, or “as is” COA, and

provides context for development of the problem statement. Background information should

include:

3.4.3.1. Program description.

3.4.3.2. Mission.

3.4.3.3. Acquisition phase.

3.4.3.4. Reason for PS-BCA (Milestone phase in the acquisition life cycle, New weapon

system or platform, Proposed change in PSS, Five-year revalidation).

3.4.4. Significant changes. Any significant changes to the following since previous analyses

were accomplished (revalidation):

3.4.4.1. Operating environment.

42 DAFPAM63-123 14 APRIL 2022

3.4.4.2. Operating tempo.

3.4.4.3. Modifications to contracting language.

3.4.4.4. Basing.

3.4.4.5. Budgetary environment.

3.4.5. Review Charter. The PS-BCA IPT reviews and updates the charter to summarize the

PS-BCA IPT’s direction and approval process. Elements of the charter include authority,

purpose, problem statement, scope, desired outcome(s), baseline determination, governance

structure, and schedule.

3.4.6. Baseline Determination. Describe the “as is” state in sufficient detail to establish cost,

and for new systems identify analogous systems for comparative cost analysis. Refer to Section

4 (COAs) for additional information.

3.4.7. Framework Development

3.4.7.1. Problem Statement. The PS-BCA problem statement should provide an accurate

and concise reason for conducting the PS-BCA, as well as define the analysis framework

for the current deficiencies, additional requirements, or opportunities for improvement.

The problem statement is also commonly referred to as the “objective.” For additional

detail, refer to guidance in AFMAN 65-506, Section 2.2. The PS-BCA should also focus

on identifying the best value PSS by balancing requirements (i.e.: Operational Availability

(Ao)) and affordability to meet the warfighters’ requirements. The PSS for a specific

program or component should be tailored to the operational and support requirements of

the system. However, readiness and availability should be balanced with affordability,

taking budget realities into account. There is no “one size fits all” approach to PSS

development. During the PS-BCA IPT problem statement development, the IPT needs to

consider the following key questions:

3.4.7.1.1. What is the desired end state?

3.4.7.1.2. What is the purpose of the analysis?

3.4.7.1.3. What is required to meet statute?

3.4.7.1.4. Is there an existing PSS in place? If so, are requirements/expectations being

met?

3.4.7.1.5. Are their deficiencies, additional requirements, or opportunities to improve

system support?

3.4.7.1.6. What decision(s) is/are the analysis intended to support?

3.4.7.1.7. Has appropriate product support analysis been completed (such as Level of

Repair Analysis, Depot Source of Repair, Supportability Analysis)

3.4.7.1.8. Caution/Pit Fall: PS-BCA problem statements should not assume a specific

means of achieving the desired result. Rather, problem statements contain an objective

description of the desired end-state or outcome (i.e., not biased toward any one COA).

Biases or unfounded assumptions in problem statements undermine the analytical

purpose of the PS-BCA by jumping to conclusions.

DAFPAM63-123 14 APRIL 2022 43

3.4.7.2. Scope. A well-defined problem statement aids in establishing the scope of the PS-

BCA. The scope will then aid the IPT in setting and maintaining the boundaries for the

analysis. Scope includes what product support capability and timeframes will be analyzed.

The scope should also state what aspects of the program are not included in the analysis

and why (i.e.: covered under separate analysis, not a differentiator across the COAs,

outside the area of responsibility of the PMO, etc). The scope of the analysis describes the

content that is included in the analysis and the content that is excluded from the analysis.

In order to determine the scope, the PS-BCA IPT needs consider the following:

3.4.7.2.1. Will the analysis be conducted for the entire system or only on certain sub-

systems?

3.4.7.2.2. Will the analysis include both common and peculiar components?

3.4.7.2.3. Will the analysis include associated equipment not managed by the PMO

conducting the analysis (i.e.: training systems, weapons, system

engineering/automated test systems (ATS), etc.)?

3.4.7.2.4. Will all 12 IPS elements be analyzed? If one or more of the IPS elements

are not applicable to the PS-BCA, a rationale should be provided that describes the

exclusion.

3.4.7.2.5. What organizations are impacted/involved in the analysis?

3.4.7.2.6. What geographical areas, sites, and locations are impacted/involved in the

analysis?

3.4.7.2.7. Is this a peacetime or wartime operating environment?

3.4.7.2.8. Are there other categories that might have a potential impact on the decision?

3.4.7.2.9. Will the PS-BCA consider all 12 IPS elements? Table 3.2 shows a second

recommended categorization of the 12 IPS elements combined into higher

level/overarching categories. The asterisks (*) within Table 3.2 annotates cross-

cutting elements and should be considered across all categories. This second

categorization is very similar to the breakout of the 12 IPS elements previously

discussed in Section 1 (Overview) of the pamphlet.

Table 3.2. Integrated Product Support (IPS) Element Categorization.

Product Support

Management

Maintenance

Supply Chain

Management

Sustaining

Engineering

Technical Data

Computer Resources

(except for S/W

Maintenance)

Facilities and

Infrastructure*

Support Equipment*

Training and Training

Systems*

Computer Resources

(S/W Maintenance

Only)

Maintenance

Planning and

Management

Supply Support

PHS&T

Design Interface

Sustaining

Engineering

44 DAFPAM63-123 14 APRIL 2022

Manpower and

Personnel*

Product Support

Management

3.4.7.2.10. Has the PS-BCA IPT clearly explained and documented why an area of the

program was included or excluded and the rationale needs to link back to the PS-BCA

problem statement?

3.4.7.3. Desired Objectives and Requirements. The desired objectives for requirements

identified by the PS-BCA IPT should be coordinated at the O-6/GS-15 IAP. The PS-BCA

IPT needs to come to consensus on the desired objectives and periodically review them to

remain on track. IAP members should also concur with the desired objectives. Some

possible sources of program requirements may be the Key Performance Parameters (KPP),

Key System Attributes (KSA), performance metrics already identified by the Capability

Development Document (CDD), and Capabilities Production Document (CPD).

3.4.7.3.1. The desired objectives and documented requirements may take the form of

a Product Support Arrangement (PSA). A PSA is an implementing agreement, such as

a contract, memorandum of understanding (MOU), memorandum of agreement

(MOA), commercial service agreement (CSA), service level agreement (SLA), and

similar formal agreements to ensure performance expectations (on both sides) are

clearly articulated.

3.4.7.3.2. Desired Objectives Examples.

3.4.7.3.2.1. MAJCOM perspective: Increase in Aircraft Availability (AA) to meet

mission requirements without increasing fleet size.

3.4.7.3.2.2. A reduction of Mission Impaired Capability Awaiting Parts (MICAP)

across the platform that supports an increase in AA to meet mission requirements

without increase in cost or logistics footprint.

3.4.7.3.2.3. Reduction in Operation & Support (O&S) costs.

3.4.7.3.3. Best Practice. It is difficult to create a good problem statement without

thinking through the scope and desired objectives. The problem statement creation is

iterative. A good problem statement provides a clear description of the issue areas to

be evaluated and how success will be evaluated. The problem statement should be

approved by the appropriate governance structure at/or around the time of the kickoff

meeting, i.e. PEO and/or PM. Leadership concurrence early in the PS-BCA process

can mitigate unnecessary rework and ensure the analysis covers the assigned subjects.

Make sure problem statement scope and objectives are properly aligned. Clearly

identify if multiple ACAT program(s) are associated with the analysis and include in

GR&A (i.e.: If the PS-BCA is planned to include a weapon system and any associated

modernization efforts, need to state what modernization efforts are included in the

baseline.) Ensure that desired objectives can be properly addressed in the analysis. For

example, if one of the desired objectives is an increase in AA, ensure that

methodologies and relevant data will be available to provide this information.

DAFPAM63-123 14 APRIL 2022 45

3.4.7.4. Ground Rules & Assumptions (GR&As). This section provides guidance on

documenting GR&As and methodology used for a PS-BCA. GR&As and methodologies

should be examined early in the PS-BCA process and the draft GR&As and methodology

should be developed prior to the kickoff meeting. Putting the GR&As in the charter helps

frame the analysis and supports the rules of engagement for the PS-BCA IPT. The initial

GR&As may be modified as the analysis progresses. Any change to GR&As after the

charter is signed should be vetted and agreed to by the IAP members prior to

implementation.

3.4.7.4.1. Ground Rules. The ground rules document known or dictated parameters

and conditions for the PS-BCA. Prior to formulating assumptions, what is known for

certainty should be stated under the ground rules: facts, laws, defined criteria,

constraints, regulations, OSD and/or Service guidance. Included in the ground rules

are any factors known to be true that may affect the current or future business

conditions. Constraints are those factors known or discovered that are beyond the

control of the PM or PSM and bound the PS-BCA analysis. The PS-BCA IPT needs

to understand these constraints before beginning the analysis. Constraints should be

presented to the governance board and decision maker of the PS-BCA. An example of

a constraint could be funding constraints originated by a congressional mandate.

Programs should have an initial DSOR at MS-A, and an updated DSOR at MS-B. For

programs at or past MS-C, they should have completed their DSOR and preceding Core

determination. These DSOR and Core determinations should not be superseded by the

PS-BCA. The ground rules should be compliant with all applicable laws including but

not limited to 10 USC §2460, §2464 and §2466. A non-exhaustive list of major PS-

BCA ground rules includes:

3.4.7.4.1.1. Legislation, regulations, and policy

3.4.7.4.1.2. Financial data in base-year or then-year dollars

3.4.7.4.1.3. Directed inflation index

3.4.7.4.1.4. Quantity of fielded systems

3.4.7.4.1.5. Expected flying hour program and service life

3.4.7.4.1.6. The XX Fleet size is ### with an expected service life of YY years.

3.4.7.4.1.7. Flying hours per system is ###.

3.4.7.4.1.8. Engines will average initial and subsequent overhaul intervals of

~XX,XXX flying hours.

3.4.7.4.1.9. MAJCOM Ao threshold is ##% and Objective is ##%.

3.4.7.4.1.10. Other DoD agencies (i.e. Navy, Army, Defense Logistics Agency

(DLA), etc.) will manage/repair common (stock listed) spare parts and/or support

equipment that applies to the (name of program) system.

3.4.7.4.1.11. The (program name) will be maintained using what maintenance

concept – organizational level (O-level) and depot level (D-level); however, there

will be some O-level back shop work to be defined.

3.4.7.4.1.12. All costs will be presented in Base Year 20XX (BYXX) dollars and

46 DAFPAM63-123 14 APRIL 2022

Then-Year (TY) dollars.

3.4.7.4.1.13. All comparative cost dollars will be presented in Net Present Value

(NPV) or Present Value (PV) Costs, as appropriate.

3.4.7.4.1.14. The O&S Element Structure used in the cost analysis will be based

on the guidance provided in the Operating and Support Cost Estimating Guide and

prepared by the OSD CAPE.

3.4.7.4.2. Assumptions. An assumption is an informed position about what is true of a

current or future state of affairs for a situation where explicit factual knowledge is

unobtainable (i.e., inflation rates). Assumptions define aspects that are beyond the

control of the PS-BCA team. They are explicit statements about the conditions on

which the PS-BCA IPT bases the analysis. After stating factors in the ground rules

section, list assumptions and document why those assumptions were selected. If a

stakeholder or advisor non-concurs with any selected assumption, document the

rationale for the non-concurrence. Assumptions are also vital for the risk and

sensitivity analysis. It is important to note that GR&As may be changed throughout the

analysis process. GR&As do not need to be 100% complete for charter inclusion.

GR&As in the charter should be used to help frame the analysis and support rules of

engagement for the IPT. However, any changes to GR&As after the charter is signed

should be vetted and agreed to by the IPT prior to implementation. In the sensitivity

analysis section, evaluate each major assumption to determine its impact on the PS-

BCA recommendation. Omitting, changing, or misusing of assumptions can directly

influence which COA is recommended. A non-exhaustive list of major PS-BCA

assumptions includes:

3.4.7.4.2.1. Financial metrics and inputs (inflation).

3.4.7.4.2.2. Physical environment.

3.4.7.4.2.3. Contingency vs. non-contingency operations.

3.4.7.4.2.4. Expected useful life of a weapon system.

3.4.7.4.2.5. The “as-is” COA should represent the current POE and LCSP.

3.4.7.4.2.6. (List additional items) should be considered as part of the PS-BCA.

3.4.7.4.2.7. (List additional items) not considered as part of the PS-BCA.

3.4.7.4.2.8. Benefits metrics span the same time period as the cost estimate to

provide uniformity in comparing cost to benefits.

3.4.7.4.2.9. Programmed Depot Maintenance (PDM) / Analytical Condition

Inspection (ACI) / modification line will remain on an X-year cycle for the study

scope of YYYY-YYYY.

3.4.7.4.3. Exclusions and Inclusions. Exclusions are those areas outside the scope of

the analysis and/or those areas that would be the same for all scenarios. Examples of

areas that could be excluded from the analysis are as follows:

3.4.7.4.3.1. Sunk costs

3.4.7.4.3.2. Realized benefits

DAFPAM63-123 14 APRIL 2022 47

3.4.7.4.3.3. Modification programs under development

3.4.7.4.3.4. Programs that required a standalone study

3.4.7.4.4. Inclusions identify areas specifically considered as applicable to the study.

Examples of areas that could be included in the analysis are as follows:

3.4.7.4.4.1. Non-recurring start-up costs

3.4.7.4.4.2. Material cost

3.4.7.4.4.3. Depot Maintenance Cost (incremental rate and full cost to recover rate)

3.4.7.4.4.4. Support equipment

3.4.7.4.4.5. Training/simulators

3.4.8. Update Charter. The PS-BCA IPT updates the charter to summarize the PS-BCA IPT’s

activities per the IPT kickoff meeting.

48 DAFPAM63-123 14 APRIL 2022

Chapter 4

COURSES OF ACTION

4.1. Introduction. COAs, also known as alternatives, are various options to achieve the desired

objective. Selection of the proper product support COA is essential to the success of the PS-BCA.

There is no set maximum number, however, a minimum of two COAs is required for a PS-BCA.

The decision maker, however, should have a representative range of COAs to make a well

informed decision. If too many COAs are evaluated for example, the costs and time to perform

the PS-BCA analysis will increase and the quality of the analysis for each COA will likely be

negatively impacted. Therefore, the team should carefully consider the breadth and variety of

COAs to be selected for analysis.

4.1.1. COA Development. COAs can be intuitively obvious or they may take a determined

effort to define. Creativity is key to developing effective COAs and many times groups are

more creative than individuals. All alternatives that are reasonable and feasible shall be fully

analyzed (AFMAN 65-506, Paragraph 3.3.2). Those developing COAs should have knowledge

of the program in question and an understanding, or at least a solid foundation, of the different

IPS elements.

4.1.2. COA Detail. COAs need to be described in sufficient detail to facilitate proper analysis

(cost, benefit and risk). COAs should also be defined so that appropriate IPS and costs elements

can be identified and evaluated in terms of the scope of work and who will perform the work.

Even those unfamiliar with the COAs should be able to read the descriptions and fully

understand the concepts and what is required to implement the COAs. Additionally, each COA

needs to be clearly distinguishable from other COAs.

4.2. Status Quo COA. The PS-BCA should include a COA which is the status quo as

documented in the LCSP. This is the “change nothing” or “as-is” COA that describes how the

function or process under study currently exists. The PS-BCA is about action, inaction and

consequences. Changing nothing for now is not necessarily "neutral" - there can be both negative

and positive consequences - and a full consideration of all factors should strengthen any

subsequent findings. For assessments completed prior to MS-C, the PMO should utilize the PSS

approved at the previous MS as the “as-is” COA.

4.2.1. COA Baseline. The status quo or “as-is” COA should serve as a baseline against which

all other COAs are compared. This COA also takes into account the future plan of the

organization, such as planned and scheduled changes and/or enhancements to the existing

program, and should reflect a review of the mission and strategic goals.

4.3. Future State COAs. Future state COAs, also known as the “to-be” COAs, establish other

options that should be evaluated. As stated previously, these COAs need to be clearly

distinguishable from each other and also provide sufficient variety to give decision makers options

to choose from.

4.3.1. COA Formulation. Future state COAs are formulated by the PS-BCA IPT. The IPT

utilizes brainstorming techniques or structured techniques such as the Decision Support Matrix

for Product Support, as described in the DoD Product Support PS-BCA Guidebook, to assist

them throughout the process. There are two primary methods to structure COAs, holistic and

modular.

DAFPAM63-123 14 APRIL 2022 49

4.3.2. Holistic Approach. The holistic approach views the work streams, or IPS elements, as

interrelated and are not analyzed independent of each other. This is essentially an “all or

nothing” perspective to developing COAs. When using a holistic approach costs, benefits, and

risks are assessed across all IPS elements at the same time. If a PS-BCA is being performed

after MS-C, a holistic approach is generally used due to overlapping work streams. Table 4.1

shows how this approach would be represented for the individual IPS elements.

Table 4.1. Holistic Approach.

4.3.3. Modular Approach. The modular approach, views the work streams or IPS elements as

standalone elements which can be combined to form a COA. An example of a modular

approach, shown in the Table 4.2, assesses costs, benefits, and risks associated with each work

stream and then combining those work streams in a variety of combinations to determine the

best overall COA. The IPT should examine each of the IPS elements to ensure the proprietary

nature of data and intellectual property does not inhibit potential combinations. If a PS-BCA

is being performed prior to MS-C, a modular approach is generally used due to the analogous

data that is used and this should provide flexibility to decision makers by allowing them to

customize a COA for their decisions.

Table 4.2. Modular Approach.

4.3.4. Comprehensive View. The best solution is not necessarily the most obvious solution,

and some innovative thought is often required to develop other possible solutions to a problem.

In defining COAs, the IPT should take a comprehensive view and include considerations

related to each COA.

4.3.5. COA Limitations. To begin defining COAs, the IPT should establish the limits of viable

COAs (bookends) in order to establish boundaries for a diverse set of COAs to analyze. While

50 DAFPAM63-123 14 APRIL 2022

COAs can be defined in terms of capabilities and performance, they are usually defined in

terms of the source of product support (i.e., organic or contractor). All organic or all contractor

supported systems are rare and are generally limited to mission driven operational environment

factors (all organic) or commercial or commercial-derivative systems (all contractor). Even

though all organic or contractor source of product support are often not viable, the rationale

for their exclusion from evaluation should be included in the PS-BCA. The alternative analysis

focuses on achieving the appropriate mix of organic and contractor capabilities through finding

the best value solution for each of the IPS elements required for sustainment.

4.3.6. COA Evaluation. When defining future state COAs, the IPT needs to explain how each

“to-be” COA operates, how it provides value to the organization, and how it compares to the

current “as-is” COA. Other questions the IPT needs to consider include: How do future state

COAs address shortfalls in the current state? How does one future COA relate to other “to-

be” COAs being examined? For each COA considered, the IPT describes the future state of

operations that the proposed decision should help achieve. Additionally, the PS-BCA contains

the rationale decisions on how COAs were developed and how COAs were eliminated as part

of a down-select process.

4.3.7. Additional Factors. Other factors to consider when identifying and defining future state

COAs include the following.

4.3.7.1. Identify the reasonableness and feasibility of product support providers across the

different IPS elements. For additional detail, refer to AFMAN 65-506, Section 3.3.

4.3.7.2. Consider various feasible combinations of workload percentages, such as 50–50,

25–75, 75–25.

4.3.7.3. Consider the possibility of developing competitive contractor COAs using both

the OEM and Third Party Logistics (3PL) options.

4.3.7.4. Consider various contract types and specify the degree to which it impacts the

analysis.

4.3.7.5. When applicable, use PPP to leverage the capabilities of both organic and

contractor sectors. See DoD PPP for Sustainment Guidebook for further information on

each type of PPP. Tailor partnerships to IPS elements at the component, sub-assembly, or

system/platform level.

4.3.7.6. Address items that have been identified as a requirement to establish repair

capability, including considerations of facilities, personnel and data rights.

4.3.7.7. Ensure COAs are in compliance with Title 10 U.S. Code §2464, Core logistics

capabilities, the DSOR decision, and Title 10 U.S. Code §2466. Explanation needs to be

included if a COA is not in compliance.

4.3.7.8. For systems in sustainment, consider focusing COA development on specific IPS

elements where there are performance gaps or opportunities for improvements.

Additionally, keep in mind that previous decisions or specific leadership direction may

influence COA development for systems in the sustainment phase.

4.4. Reasonableness and Feasibility. By definition, the option selected to meet the desired

objective should be one of, or a combination of, the COAs considered. Therefore, it is essential

that in the decision-making process a range of reasonable COAs are examined. For a COA to be

DAFPAM63-123 14 APRIL 2022 51

reasonable, it must be consistent with all legal requirements and Air Force regulations. Adequacy

and feasibility are other key elements in the identification of reasonable COAs. Adequacy refers

to the capacity of the potential COA to meet the desired objective. Feasibility refers to the potential

COA being consistent with funding, technological and scheduling realities.

4.4.1. Iterative Process. COA analysis is an iterative process. The first step is an examination

of the range of potential COAs to determine which are reasonable and require further

evaluation. This information should be summarized in the PS-BCA. An alternative that meets

the desired objective, including the status quo, is reasonable if it cannot be eliminated on non-

economic grounds. It is possible that only one COA will be reasonable, however, generally

there are two or three reasonable COAs that warrant further evaluation. Normally, no more

than four or five COAs are considered in detail, although there are exceptions.

4.4.2. COA Elimination. A COA can be eliminated from further analysis whenever it appears

to no longer achieve the desired objective; it should be coordinated with the O-6/GS-15 IAP

to gain concurrence with its removal. COA elimination requires approval at the O-6/GS-15

level of the governance body. For example, a number of COAs were considered but as the

analysis progressed, only two emerged as feasible. The preliminary calculation of life-cycle

costs and benefits demonstrated that one of the two COAs was clearly superior to, and less

costly, than the other. At that point, there was no benefit to be gained from completing any

further analysis. The findings should simply be documented in a short report or memorandum.

4.4.3. COA documentation. If a COA was considered but dismissed as unreasonable,

document the rationale for dismissal in the PS-BCA final report. Cost alone is not a valid

rationale for a COA being dismissed. If cost is the only aspect of an infeasibility determination

for a COA, the analysis should be shown. Specifically, the COA should be developed, costed,

and proven to be prohibitive, not merely dismissed from the onset as being infeasible due to

cost.

4.4.4. Additional Consideration. Areas to consider when validating and determining

feasibility include, but are not limited to, the following:

Are all feasible COAs considered?

Are a reasonable number of COAs considered to include the limits (bookends) COAs and

hybrid COAs containing diverse combinations of providers for the various integrated

product support elements?

Are COAs significantly different?

Is adequate supporting documentation provided for all COAs that were down selected

before full analysis was completed?

Are the COAs in accordance with legislative guidance?

Were other government agencies' capabilities to provide a product or service considered?

Are the COAs defined in such a manner that the applicable benefits, cost elements and

possible risks can be clearly identified and assigned?

Do the COAs clearly identify who will provide support in each case? For example, will

support be provided organically or commercially?

Do the COAs identify where the work will be done? For example, will depot or material

support be provided locally or will transportation to other locations be required?

Depending on the answer, this might involve additional cost and possibly an increase in

time.

52 DAFPAM63-123 14 APRIL 2022

Are obvious COAs included or addressed in some manner? For example, an obvious

issue to address in the COAs is whether maintenance and other sustainment activities

should be performed by the government or by a contractor.

DAFPAM63-123 14 APRIL 2022 53

Chapter 5

BENEFITS AND NON-FINANCIAL ANALYSIS

5.1. Benefits Introduction. Benefits are non-monetary factors that are a critical part of COA

evaluation in comparative analyses. Benefits differ from cost in that, costs are inputs (monetary

resources) required to implement each COA, whereas, benefits are the outputs to be gained as a

result of the resource inputs. In developing the list of costs and benefits, care should be taken to

avoid double-counting (i.e., benefits should be mutually exclusive). Benefits are evaluated using

the metrics that measure success in the “as is” state of the current product support arrangement.

These metrics should be applicable to all the COAs. They can be qualitative or quantitative in

nature (subjective or objective).

5.2. Selecting Benefits. To determine which benefits to include, stakeholders should assess the

factors most important in achieving the desired outcome and for evaluating the problem statement.

These should be tied to the product support requirements such as SCM, SE, maintenance, etc.

Benefits may be qualitative in nature, which injects a degree of subjectivity into the assessment.

While this subjectivity cannot be avoided, it is important that the scoring and results are traceable

and repeatable. Any and all categories of benefits analyzed should be fully explained so someone

unfamiliar with benefits can fully understand the benefit and its measurement. Note: If a benefit

can be measured in monetary terms, it should be included in the cost section of the analysis.

5.2.1. Stakeholder Input. One approach to select the benefits to be assessed is to receive input

from stakeholders, support SMEs, and advisors that are listed in Section 3 (PS-BCA IPT

Membership). As discussed above, a key advisor on the team should be a cost analyst who

should advise the team on methodology and process, but should not participate directly in the

weighting and scoring of benefits. The first step in the benefit analysis process is for the team

to develop a list of benefits expected to accrue as a result of implementing the COAs under

consideration.

5.2.2. Benefit Realization. Benefits should be developed within the context of the problem

statement and the scope of the analysis. The benefits developed should be benefits to the

government, not simply the program under study, attained over the period of analysis. Realized

benefits are excluded from consideration and this should be documented in the GR&As. There

are two broad categories of non-monetary benefits: non-monetary quantitative benefits and

non-monetary qualitative benefits.

5.2.3. Category Metric Attributes. The linkage from the category down to the metric and

attribute, along with the rationale and data source, should be completely documented by the

PS-BCA Team (see Table 5.1). Appendix F in the OSD Performance Based Logistics

guidebook, dated 2016, is a good source for metrics across the product support elements.

54 DAFPAM63-123 14 APRIL 2022

Table 5.1. Category Metric Attribute.

5.3. Quantitative Benefits and Metrics.

5.3.1. Non-monetary Factors. These factors are non-monetary, but quantifiable in terms other

than dollars. Examples of non-monetary, quantifiable benefits include AA, parts

supportability, system sustainability, etc. Benefits are the overall criteria selected of “measures

of goodness” of the COAs under consideration. PS-BCA IPTs should take care to fully use

quantitative benefits, if data permits, rather than a subjective benefit that is intended to measure

the same factor.

5.3.2. Metric Evaluation. Metrics are the data elements used in the evaluation of the benefits

categories. For example, a benefit selected by the team under the Supply Support Category

may be Issue Effectiveness. Existing metrics of the program under study, or an analogous

program for new programs with no history, provides a starting point for determining the most

important outputs of a particular project or program. There is no precise “right number” of

benefits or supporting metrics. However, benefits should be limited to those most important

in meeting the requirements established in the problem statement. Evaluating an excessive

number of benefits tends to dilute the impact of any one benefit and may result in inconclusive

results.

5.3.3. COA Comparison. All feasible COAs considered in the analysis should be evaluated

against the same set of benefits categories and metrics. If a particular COA does not provide

a stated benefit, it should be scored zero in the weighting and scoring process (Section 8.0,

Weighting and Scoring).

5.3.4. Wash Benefits. Benefits not expected to differ across COAs are wash benefits, just as

costs that are the same across COAs are wash costs, and can be excluded from the benefits

analysis. Excluded benefits should be discussed in the GR&As, so that it does not appear that

the omission was accidental.

5.3.5. Metrics supporting PSS. Metrics are the means by which the PSM and PS-BCA team

gain understanding of the PSS and identify potential gaps between required and actual

performance. There is no perfect metric, but selecting an appropriate set of metrics should

promote the desired behavior and outcome for executable COAs. Benefits criteria should be

coordinated with the O-6/GS-15 IAP.

5.3.6. Value-Add Metrics. Metrics should be selected or constructed to encourage

performance improvement, effectiveness, efficiency, and innovation. These metrics should be

applicable to “as is” state and should be the starting point for the PS-BCA. The metrics should

effectively align with the warfighters’ mission, contribute to meeting requirements, ensure on-

time delivery of a quality product, and reduce costs. It is important to exercise caution when

DAFPAM63-123 14 APRIL 2022 55

selecting a combination of metrics to ensure that they are not redundant, confounding, or

counteractive. Multiple metrics can reinforce desired behavior or create undesirable conflicts.

5.3.7. Metric Documentation. The PS-BCA Team should document the reasoning/rationale

for using the specific metrics. The sources and derivation of quantitative benefits must be

documented in the same level of detail as costs, and should include all interim calculations as

appropriate. The stakeholders and advisors should understand and agree to this rationale.

Below are examples of some quantitative benefits and associated metrics:

Table 5.2. Quantitative Benefits and Associated Metrics.

Category

Subcategory

Metric

Attribute

Data Source

Supply Chain

Management

Components

Issue

Effectiveness

Responsiveness

LIMS-EV

Supply Chain

Management

Components

Fill Rates

Responsiveness

LIMS-EV

Supply Chain

Management

Components

MICAP Hours

Responsiveness

LIMS-EV

Supply Chain

Management

Components

Customer Wait

Time (CWT)

Responsiveness

SBSS

Maintenance

Planning &

Management

DLRs/PDM/C-

check/ACI

PQDR

Quality

Joint Deficiency

Reporting

System

Maintenance

Planning &

Management

DLRs/PDM/C-

check/ACI

Flow days

Responsiveness/

Schedule

MP&E,

LIMS-EV

Sustaining

Engineering

Sustaining

Engineering

107 Requests

Engineering

Response Times

Program Office

Sustaining

Engineering

Sustaining

Engineering

202 Requests

Engineering

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5.4. Qualitative Benefits and Metrics. Qualitative benefits are intangible benefits that are not

easily quantified, but are nonetheless important. This might include factors such as capability

enhancements, environmental benefits (use of renewable energy resources, lower or less toxic

emissions, etc.), morale/quality of life, and safety. Strategic organizational benefits may be

difficult to quantify or may be unquantifiable/intangible in some situations, but are often very

critical when developing a business case. These benefits may be very important to the organization

because of law, policy, or strategic objectives that direct the result or because of other

organizational goals. A well done qualitative benefit analysis is as valid as a quantitative analysis.

Definition and explanation of benefits are important to give the analysis credibility and to help

readers understand their importance. Thorough definition and explanation of weighting and

scoring rationale go a long way in balancing the inherent subjectivity associated with a qualitative

analysis, and assuring decision makers that the benefit evaluation was based on sound reasoning

and represents stakeholder/advisor consensus on the methodology.

56 DAFPAM63-123 14 APRIL 2022

5.4.1. Financial Management Compliance. Compliance with AFI 65-501 and AFMAN 65-506

states analysis, inputs and rationale must be fully documented as part of the BCA, so that it is

traceable and repeatable.

DAFPAM63-123 14 APRIL 2022 57

Chapter 6

COST AND FINANCIAL ANALYSIS

6.1. PS-BCA Cost Estimates. This section states the requirements for developing credible,

defendable, and high quality PS-BCA cost estimates. The intent is to construct cost estimates for

all considered COAs which appropriately account for platform maturity and which can be

thoroughly documented, easily replicated, and utilized to effectively inform the MDA. Cost

methodologies must be thoroughly documented so the analysis can be replicated if necessary

(AFMAN 65-506, Paragraph 4.1.3.) Below are the criteria for completing credible, defendable,

and high quality PS-BCA cost estimates:

6.1.1. GR&As are reasonable and properly documented.

6.1.2. Guided by the problem statement.

6.1.3. Properly utilizes comparative analyses methods.

6.1.4. Data is normalized, projected and used in the estimate correctly.

6.1.5. The PS-BCA model and cost estimates accurately represent the PSS for each COA.

6.1.6. Ensures cost risk is handled consistently for each COA.

6.1.7. Enables the decision maker to make the most informed decision possible.

6.2. Criteria 1 – Guided by the Problem Statement. The cost analysis is guided by the problem

statement which is explained in section 3.2.6.1 of this pamphlet. If the problem statement is a best

value determination such as “The F-XX PS-BCA will determine the best value COA long-term

sustainment strategy for the F-XX unique items consistent with Air Force objectives,” then both

costs and benefits are evaluated and the cost estimates should include only F-XX unique items. If

the problem statement is a cost effectiveness analysis such as “The T-XX PS-BCA will look at all

strategies that reduce cost while keeping performance the same,” then cost is the only variable and

the estimates should keep performance the same across all COAs. If the problem statement is a

fixed budget optimization, such as “maximize performance of the B-XX while not exceeding a

$XXM threshold,” then the performance criteria should be adjusted until the corresponding cost

estimate is under the dollar threshold. The problem statement clearly defines the purpose of the

decision that the cost analysis is intended to support. The data collected and analyses performed

are focused on providing the decision maker as much information as possible for the problem being

addressed and the criteria being used to make the decision.

6.3. Criteria 2 – GR&As are Reasonable and Documented. The GR&As for the cost analysis

should be reasonable, documented, and constructed to aid the PS-BCA IPT in building credible,

defendable, and high quality cost estimates. Relevant GR&As should: (1) address elements that

drive a cost delta between COAs; (2) ensure the PS-BCA is fair, balanced, and a realistic

comparison across all COAs; and (3) have coordination from the IAP member organizations. The

rationale and source for each GR&A should be included.

6.3.1. Example: When transitioning from contractor maintained components to government

maintained components, it would be reasonable to assume that Interim Contract Support (ICS)

may be required for a few years while organic capabilities are being prepared. The

58 DAFPAM63-123 14 APRIL 2022

corresponding ground rule might be: For COAs standing up additional government repair,

assume four years of ICS, then transition to government.

6.4. Criteria 3 – Properly Utilizes the Various Types of Analysis. The PS-BCA is a

comparative analysis. The categories of costs included in a comparative analysis are governed by

OMB Circular A-94, Guidelines and Discount Rates for Benefit-Cost Analysis of Federal

Programs, and differ from the categories of costs included in other program cost estimates.

6.4.1. Comparative Analysis: A comparative analysis is any type of analysis examining the

costs, benefits and risks of alternative ways of achieving a given objective or fulfilling a need.

6.4.1.1. For comparative analyses, OMB Circular A-94 requires an “incremental” cost

approach.

6.4.1.2. The cost analysis will only include costs for which funds have not yet been

expended or irrevocably committed. Do not include sunk costs, as these costs do not factor

into the decision. When the magnitude and timing of a cost or benefit is identical for all

alternatives, they can be considered as “common costs” (also called “wash costs”) or

benefits. Common costs that do not add any additional information to the decision-making

process may be excluded from the comparison. Caution should be taken when identifying

common costs to confirm that costs or benefits excluded are identical for all alternatives.

Additionally, common costs should not be excluded when there is a requirement to reflect

the total program costs.

6.4.1.3. Caution. Other program estimates based on the total cost of the program won’t

match the cost estimate used for comparative analysis in the PS-BCA. Typical examples

include the Life Cycle Cost Estimate (LCCE) generated to support milestone decisions or

generated for budget purposes. While an LCCE can be the starting point of a PS-BCA cost

estimate, adjustments must be made to ensure that only incremental costs are included, that

sunk and wash costs are removed, and any other relevant changes (e.g., Labor Rates – see

below) are made to meet the requirements for a comparative analysis (AFMAN 65-506,

Paragraph 4.4.2).

6.4.1.4. Pitfall. The cost estimates used in the PS-BCA for comparative analysis do not

include all the costs necessary for understanding the implementation cost of an alternative

or for making a budget comparison. Adjustments should be made to these estimates for

use in any context outside the PS-BCA.

6.4.2. Labor Rates. Labor rates required for the PS-BCA should be different than those needed

for full or total cost of the program estimates. For organic depot labor calculations (to include

any civilian personnel not directly working at the depot but are necessary manpower increases

for these COAs), the PS-BCA IPT utilizes the incremental labor rate portion of the sales

rate/price to customers to identify the cost of implementing the final chosen alternative. The

change in the workload distribution as a result of the PS-BCA decision could change the

organic cost recovery sales rate/price and/or contractor labor rates.

6.4.2.1. For instance, if additional work is taken on by an organic depot, more mechanics,

engineers, floor supervisors and material would be needed in order to complete the task.

These incremental costs would be included in the organic depot incremental and full sales

rates. An organic depot sales rate includes both labor and material. However, the cost of

the base commander, while part of the burdening and cost to a customer, is not an

DAFPAM63-123 14 APRIL 2022 59

incremental cost and would not change with the decision to add workload to a depot.

Therefore, the base commander cost would be excluded in an incremental rate for a

comparative analysis. In most cases, the incremental cost rate uses the full cost to recover

Sales Rate as the baseline, and then removes all of the General & Administrative Costs, as

well as most of the Production Overhead costs – only leaving the Indirect Production

Material costs and the Shop Operating Material costs in the Production Overhead category

for Organic Depot Maintenance.

6.4.3. Workload Impacts. The last part of the analysis would be to determine if the decrease

in workload impacts other customers. For example, if the decision was made to move full

maintenance support for weapon system (A) from organic depot maintenance support to a

contractor, organic labor rates may increase due to the change in workload being supported

through the Air Force Working Capital Fund.

6.4.3.1. Similarly a change in workload for a contractor could impact a contractor’s

business base and labor rates, though this type of impact could be difficult to determine

without a contractor’s help or assistance from the Defense Contract Management Agency.

6.4.3.2. In addition to changes in direct costs, the PS-BCA IPT should be aware that a

change in workload could drive price changes to unrelated commodities or services. This

will definitely impact the taxpayer and should be taken into consideration.

6.5. Criteria 4 – Properly Utilizes the Highest Quality Data Available. Section 9 of this

pamphlet specifically addresses data selection, collection and assessment for PS-BCAs.

6.6. Criteria 5 – Data is Normalized, Projected and Used Correctly. Gathering relevant data

is vital to having a high quality cost estimate. Document completely the source/origin of all data

collected. Since data can be gathered from a variety of sources, it is often in many different forms

and needs to be adjusted before being used to enable apples-to-apples comparisons (i.e., so COAs

can be compared without unintended bias) or as a basis for projecting future costs. The process of

adjusting the data to enable an apples-to-apples comparison is called normalization. The analyst

should thoroughly document the normalization process and adjustments performed throughout the

cost estimating process. Data requires normalization for a number of reasons, some of which are

discussed below.

6.6.1. Inflation and Price Escalation. Inflation and price escalation are important and

necessary in developing a credible cost estimate and in normalizing existing data. They should

not be used interchangeably.

6.6.1.1. AFMAN 65-502, Inflation, defines inflation as the increase in general price level

over time or the decreasing purchasing power of the dollar over time. In application, this

means that, for a given number of dollars, less goods could be purchased 10 years in the

future than today. As a result, in order to utilize cost data from an antecedent platform, the

cost estimating team should need to adjust the source data to remove the effect of inflation

to ensure that all dollars, regardless of time, have the same value (i.e., purchasing power).

Collected data should be analyzed to determine the base year of the data. If the base year

of the data differs from the base year of the PS-BCA, then the data should be adjusted to

the PS-BCA’s base year before proceeding.

6.6.1.2. Escalation refers to the total change in price of specific goods or services over a

specific period of time. It includes both inflation and the “real price change” of the good

60 DAFPAM63-123 14 APRIL 2022

or service. The “real price change” is the difference between inflation and the total change

in price, and is caused by changes in the market (supply and demand). The ‘real price

change’ is the remaining price change after normalizing for inflation. The term “constant

dollar” implies currency has been normalized for inflation only. The term “constant price”

implies prices have been normalized for both inflation and market forces. In application,

care has to be taken to ensure that all alternatives are normalized for inflation, price

escalation, or both.

6.6.1.3. Escalation should be accounted for in the PS-BCA estimates for cost elements

whose prices are volatile or change at a significantly different rate than inflation (e.g., fuel,

specialized labor, etc.). Escalation rates deserve special consideration in order to properly

normalize data for use in an estimate. The Air Force specifies price escalation indices for

fuel, medical and government employee (military and civilian) pay and provides access to

Global Insight indices for other goods and services (see the SAF/FMCE website). The

escalation index used must be documented.

Figure 6.1. Illustration of Inflation, Price Escalation, and Real Price Change.

6.6.1.4. Best Practice: Assume the same escalation rate beyond known periods for all

estimates. Do not assume that one COA will escalate in a vastly different manner in the

far future unless the basis for that assumption can be firmly documented.

6.6.1.5. Caution/Pitfall: Setting unrealistic escalation assumptions or picking an

escalation rate “out of the air.” Because of the compounding nature of such rates,

unrealistic assumptions could drive or bias results. Utilize formal price indices and

forecasts (e.g., Global Insight indices, AF indices on SAF/FMCE website) as the basis for

the escalation assumptions.

6.6.1.6. Cost (e.g., content of cost, currency conversions). Units – Cost data needs to be

converted to equivalent units before being used in a data set. That is, costs expressed in

thousands, millions, or billions of dollars must be converted to the same format or

denomination.

DAFPAM63-123 14 APRIL 2022 61

6.6.1.7. Content of Cost – The cost estimator needs to understand what the cost data

includes and ensure the content matches the support strategy being estimated. For example,

does it only include direct labor or does it include overhead and the contractor’s profit as

well?

6.6.1.8. Currency Conversion – Similarly, if costs are reported in different currencies, they

must be converted into U.S. dollars in order to have a like comparison. The cost analysis

portion of comparative analyses will be performed in United States dollars.

6.6.1.9. Sizing: Sizing normalizes data to a common qualitative and quantitative metric.

When normalizing data for size, it is important to define exactly what the item represents:

What constitutes a software line of code? Does it include carriage returns or comments?

The main point is to clearly define what the sizing metric is so the data can be converted

to a common standard before being used in the estimate.

6.6.1.10. Normalizing data for usage or quantity is another example of sizing to ensure a

common standard before including the data in an estimate. Figure 6.2 lists some of the

common usage or quantity normalizations seen in PS-BCAs.

Figure 6.2. Considerations When Normalizing Data for Usage or Quantity (or Duration).

6.6.1.10.1. Key Groupings: Key groupings normalize data by similar missions,

characteristics, or operating environments by cost type or work content. Products with

similar mission applications have similar characteristics and traits, as do products with

similar operating environments. For example, space systems exhibit characteristics

different from those of submarines, but the space shuttle has characteristics distinct

from those of a satellite even though they may share common features. Costs should

also be grouped by type. For example, costs should be broken out between recurring

and nonrecurring or fixed and variable costs.

6.6.1.10.2. Life-Cycle Effects/Productivity and Technology Maturity: Life-cycle

effects should be considered when comparing data from different programs. For

example, entering technology typically follows a reliability improvement curve and

would require normalization to be compared to steady state data. Likewise, technology

improves over time, so historic cost data may need to be normalized to adjust for

productivity or quality improvements resulting from technological advancements over

time.

6.6.1.10.3. All normalization actions must be documented. Price indices are often hard

to find, so it is important that the source of the indices are documented. If the cost

62 DAFPAM63-123 14 APRIL 2022

analysis team constructed a price index for use in the PS-BCA cost estimate, the

reasoning and process used in constructing the index must be documented as well. For

additional information on data collection and the reason to use certain data sources

(especially if multiple sources exist), refer to Section 9 of this pamphlet which

specifically addresses data collection.

6.6.1.10.4. For additional guidance on inflation and price escalation and how to apply

them properly in cost estimates, refer to AFMAN 65-502, Inflation.

6.7. Criteria 6 – Cost Estimates Accurately Represent the PSS for Each COA. The PS-BCA

model is a decision-support tool used to produce cost estimates for each COA. In order to

effectively support the decision maker, it needs to represent the PSS relationships. To do this, the

cost analyst requires clear technical and programmatic direction to properly construct the model

so that it produces cost estimates that reflect the PSS for each COA as accurately as possible. In

addition, the PS-BCA IPT should have a basic understanding of how the cost model works to

ensure that it accurately represents the PSS for all alternatives.

6.7.1. Vector Checks. While developing the cost estimating model, the PS-BCA IPT should

seek periodic vector checks early and often to ensure the model being constructed accurately

represents the PSS programmatic and technical content for each COA, not the COA’s “cost

behavior.”

6.7.1.1. In addition to cost personnel, include technical and functional personnel in the

vector checks to provide a fresh perspective on the cost model and to review its consistency

with the PSS.

6.7.2. Cost Review Process. Do not wait until the estimate is near completion before starting

the cost review process. This can lead to the realization that the entire PS-BCA estimating

framework is incorrect which would require a considerable amount of rework and delay the

already lengthy process to complete the PS-BCA.

6.7.3. Productivity Gains and Cost Avoidance. Efficiencies produced by an alternative that

result only in additional time for personnel to perform other duties, but will not result in

reduced manning or operating costs are defined as cost avoidances and should be addressed in

the benefits analysis of the EA, not the cost analysis since costs won’t change. For additional

detail on productivity gains and cost avoidance, reference AFMAN 65-506, Paragraph

5.3.2.1.4.

6.8. Criteria 7 – Ensure Cost Risk is Handled Consistently for Each COA. Cost risk needs to

be evaluated, and each PS-BCA should be consistent in how it handles cost risk for each COA.

The importance of providing comparable cost estimates that include the appropriately associated

cost risks cannot be overstated. In example, if a range and confidence levels are provided for one

COA, then a range and confidence levels should be provided for all COAs. Where appropriate, all

alternatives should be evaluated at similar confidence levels. For additional guidance specifically

on cost risk, refer to the Joint Agency Cost Schedule Risk and Uncertainty Handbook.

6.8.1. Cost Risk. An example of cost risk is the risk of funding technical data collection which

should be included in the risk analysis. If the risk can be quantified, it should be included in

the cost estimate section. Stochastically modeled risk in the cost model should not be double

counted by including it in the PS-BCA’s risk analysis (section 7.0).

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6.9. Criteria 8 – Enables Decision Maker to Make the Most Informed Decision Possible. The

cost estimates for each COA need to be informative to the decision maker. The most precise cost

estimate that assumes away critical incremental costs that differ among the COAs or that does not

align with the intended PSS for that COA is not providing information that is essential. In the

end, a high quality PS-BCA cost estimate is one that informs the decision maker with relevant cost

information.

6.9.1. Present Value. Additionally, cost estimates have to be presented in a manner that the

COAs can be compared. To make a meaningful comparison of COAs, all costs intended to be

compared must be expressed in PV terms (AFMAN 65-506, Paragraph 4.4.2). Using PV

allows decision makers to consider future money streams in relation to the current value of

money. OMB Circular No. A-94 includes additional information and guidance, including

discount rates and formulas for computing NPV. AFMAN 65-506 provides additional

guidance on business case analysis and how to properly incorporate present value into a

product support business case.

64 DAFPAM63-123 14 APRIL 2022

Chapter 7

RISK ASSESSMENT

7.1. Introduction to Risk Assessment. After risks are identified, each risk factor should be

defined in detail to ensure all PS-BCA IPT members are interpreting the risk in the same way.

Care should be taken in this step to ensure there is no duplication or overlap in risk factors. Any

duplication will inappropriately skew the risk analysis and invalidate the results. If methodologies

that aggregate cost, benefit and risk (such as Analytical Hierarchy Process (AHP)) are used in the

PS-BCA, it is particularly important to ensure elements of cost, benefit and risk are mutually

exclusive. Any distortion in individual category results is amplified due to the weighting and

scoring algorithms used with these methodologies. The process of comparing different COAs is

not complete until a risk assessment is performed on each COA. DAFPAM 63-128, Integrated

Life Cycle Management, Chapter 12 provides the AF standard for risk assessment, and this

document adds fidelity to the subject as it relates to PS-BCAs. Risk should be treated separately

from cost and benefits. The analysis of risk should be based on probability and the impact of an

event. One COA may be the most cost effective but could be assessed as high risk due to technical,

operational or other risk classifications.

7.2. Defining Risk. It is difficult to discuss risk without discussing and defining the distinction

between risk and uncertainty. Risk, in its simplest sense, is the chance (probability) of loss or

injury. Uncertainty is the indefiniteness about the outcome of a situation in which both favorable

and unfavorable events can occur. Risk is then the probability of an unfavorable event occurring

that is the result of our uncertainty about a situation. In the sustainment of a weapon system, risk

can be defined as an uncertain event or condition that, if it occurs, can have negative effects on the

implementation of the PSS. It addresses the potential variation in the planned approach and its

expected outcome. While such variations could include positive as well as negative effects, this

pamphlet emphasizes the negative future effects (i.e. risk, not uncertainty). Risk management for

a PS-BCA involves the identification of potential risks for each COA, assessing probability and

impact of identified risks, developing a response to the risks, and finally monitoring risks over

time. As defined in the DoD Product Support Guidebook, risk can be classified as Business or

Programmatic, Operational, Suitability, Process, Technical, Schedule, Organizational,

Sustainability, Safety, and Environmental. Risks should exhibit three key components.

7.2.1. Future Root Cause. A future root cause (yet to happen), which, if eliminated or

corrected, would prevent a potential consequence from occurring.

7.2.2. Probability. A probability (or likelihood) assessed at the present time of that future root

cause occurring.

7.2.3. Consequence. The consequence (or effect) of that future occurrence.

7.3. Progression of Risk. Risk identification and analysis should evolve and mature over the life

cycle of the system as a result of learning more about the aspects of the program and thus

decreasing the uncertainty. At MS-B, system design is still preliminary and consequently product

support planning depends heavily on comparison to like systems as will modeling and simulation.

Identifying probability and impact at this phase may involve more qualitative analysis due to the

lack of actual performance data or dependence on analogous systems that is not a complete

representation of the new system in development. Identifying and mitigating moderate and high

DAFPAM63-123 14 APRIL 2022 65

risks early in the system’s life cycle helps to avoid cost growth later. For example, the use of

proprietary software could increase risk in the area of sustainability due to dependence on a sole

source versus using open source code capable of being supported by multiple providers. As system

design matures, the data and GR&As should also mature by aiding with the identification and

management of risk involving different product support COAs. As a system moves through the

acquisition life cycle, data availability should improve the ability to assess performance and better

identify potential sources of risk. Risk management processes should continue to monitor

identified risks and be watchful for new risks as the system progresses through each life cycle

phase.

7.4. Classifications of Risk. When assessing risk, it is important to differentiate between risks

that are of short or temporary duration, and those which are expected to continue throughout the

system life cycle. For example, a short-term risk, such as schedule risk due to a transition delay,

should not be considered to be of the same severity as a long term risk that will continue throughout

the service life of the system. Remember that risk assessment is analyzing risk over the entire

analysis period. Alternatives with short-term transition risk should not be automatically labeled

“high” or “moderate” risk, due to a transition risk that might cease to be a factor in a few years,

and which would constitute a fraction of the service life of the system. The potential for mitigation

and the additional effort required to mitigate the risk should also be considered in the risk

assessment.

7.5. Risk Management Planning. Risk management planning is the foundation of a continuous

process that is accomplished throughout the system’s life cycle, and it is the first step in the risk

management process. It is an organized methodology for continuously identifying and measuring

unknowns; selecting, planning, and implementing appropriate risk mitigations; and tracking the

implementation to ensure successful risk reduction. Risk Management Planning should follow a

standard process model through all phases of the system’s life cycle. It links a program’s risk

management effort to life cycle planning by answering “who, what, where, when, and how” risk

management should be performed.

7.6. Risk Identification. Risk identification is the second step in the risk management process.

The best method for completing this step is to assemble a team of SMEs and relevant

stakeholders/advisors. The team should generate a list of all the possible risks that could affect a

COA and clearly provide rationale or basis why this is considered a risk. Brainstorming and other

similar techniques should be used to identify potential problems. Later the list can be analyzed

and filtered to eliminate unreasonable risks. Risk identification is the activity that examines each

element of the program to identify associated root causes, begin their documentation, and set the

stage for their successful management. Examination of a PSS is accomplished through

decomposition into relevant elements, tasks or areas. Decomposition may be oriented to

requirements, processes, functional areas or technical baselines. The team should guard against

focusing on objectives versus the events that could produce the consequences. For example, the

team may identify failing to meet maintenance stand up schedule instead of the events that could

cause this to happen (lack of manpower, missing technical data, lack of required tools/support

equipment).

7.7. Risk Analysis. Risk Analysis is the third step in the risk management process. Once a list

of risks has been developed, the list needs to be analyzed to eliminate redundant risks or those

risks whose impact is inconsequential. Risk management resources should be focused on risks

that have the highest potential impact. Risk can be assessed in terms of probability and impact,

66 DAFPAM63-123 14 APRIL 2022

the combination of these two factors determines which risks are the highest threats to a particular

COA. For example, a provider of spare parts may be in poor financial state resulting in a credible

risk of going out of business. However, if the part is also available from several other vendors,

the potential impact is minimal since other sources are available. On the other hand, if a part is

rare, sensitive to damage in shipping, is a long-lead item and has few sources, the risk of losing an

asset could be assessed as high as could the impact due to inability to replace. The bottom line for

risk analysis is the process should critically examine both the probability and impact of each risk

so sufficient planning can take place to reduce either the exposure or the impact.

7.7.1. Risk Matrix. A common approach for assessing both the probability and impact of risk

is the use of the risk matrix. The risk matrix prioritizes uncertainties that could negatively

impact program cost, schedule and performance. SMEs, typically engineers, PMs, logisticians

and others familiar with the program, define the risk factors, probabilities, and resulting impact

to cost, schedule, performance or a combination thereof.

7.7.2. Best Practice: Continuously monitor risks to ensure awareness of events that may

change either the risk likelihood or risk impact. Additionally, mitigation plans should be

reviewed to ensure they are still valid.

7.8. Risk Handling Planning & Implementation. Risk Handling Planning & Implementation

is the fourth step in the risk management process. This step identifies, evaluates, and selects

options to set risk at acceptable levels given program constraints and objectives. Risk Handling

Planning & Implementation is intended to enable program success. It includes the specifics of

what should be done, when it should be accomplished, who is responsible, and the funding required

to implement the risk mitigation plan. The level of detail depends on the program life-cycle phase

and the nature of the need to be addressed. However, there should be enough detail to allow a

general estimate of the effort required and technological capabilities needed based on system

complexity.

7.8.1. Risk Mitigation. Furthermore, risk handling planning & implementation focuses on

either reducing the likelihood that a risk event will occur and/or reduce the impact should the

risk be realized. In many cases, the more cost effective option is to reduce the likelihood of a

risk occurrence. In the example of the vendor with financial troubles this may be mitigated by

setting up an indefinite-delivery indefinite-quantity type contract with multiple vendors, thus

reducing risk from sole source and adding opportunity for lower cost through competition.

Similarly, the choice to use open source software versus proprietary code would mitigate the

risk of depending on the original software manufacturer to provide follow-on support. In both

cases the likelihood of the risk event happening was reduced through planning and design

changes early in the system life cycle. However, not all risks can be addressed solely though

reducing the likelihood of occurrence, so risk mitigation plans should be developed to reduce

their impact. The exercise of developing risk mitigation plans is also a useful exercise in

helping to identify the root cause of a risk event. In the example of the item sensitive to

shipping, having limited sources and long lead time may be mitigated by improving packaging,

shipping method or adding more robust materials in the design. Deciding which mitigation

approach is most appropriate depends on knowing the root cause of damage during shipping.

Is it packaging, shipping, poor quality parts or a combination of each? Knowing this from the

risk assessment phase helps with developing the most appropriate and cost effective risk

mitigation plan.

DAFPAM63-123 14 APRIL 2022 67

7.8.2. Risk Avoidance and Transfer. Two other approaches to risk mitigation are risk

avoidance and transferring of risk. In risk avoidance, if a proposed PSS has an unacceptable

level of risk that mitigation planning cannot reduce to an acceptable level (taking into account

impacts to cost, schedule, performance), it may be best to avoid that COA. Unfortunately,

this is not always possible. If a new weapon system is dependent on a new technology that is

critical to the operation, then it cannot be avoided even if there are significant risk issues. This

leads to the option of transferring risk.

7.8.3. Risk Transfer. Transferring risk does not eliminate the risk but if done properly, it could

help reduce the likelihood or impact of such risk. One example is using fixed price contracts.

If production costs are higher than projected due to poor quality, a fixed price contract could

place part of the cost burden onto the contractor. Additionally, the potential for this cost burden

could motivate the contractor to improve its production quality, and thus reduce the likelihood

of increased costs. This is a very simple example only meant to point out that part of the risk

can be transferred or shared helping to build in greater incentives to reduce the likelihood or

impact of a risk event. The team responsible for completing the risk management process

should thoroughly understand the risk to include its root cause to help plan for the best

mitigation approaches.

7.9. Risk Tracking. Risk tracking is the fifth and final step of the risk management process.

Once risk management planning has identified the risks, assessed the probability and impacts, and

developed mitigation plans, it is necessary to monitor and adjust the risk management plan as

appropriate. Early in the life cycle, monitoring is more focused on developmental planning and

adjusting to changes in design, schedule or requirements. However, as the system matures, product

support shifts from planning and developing to executing. Risk management is a continuous

process and should include a periodic review of risk to ensure no new risks have emerged and

existing ones have not increased or decreased in probability or impact. If a risk condition has

changed this does not mean the PS-BCA should be re-accomplished, it should instead drive

implementation of risk mitigation or contingency plans depending on the most appropriate course

of action. Monitoring risks should be an ongoing activity to remain aware of changes to the

environment that may change either the likelihood or impact of risks.

7.10. Risk Management Summary. The purpose of risk management is to address uncertainty

in product support planning and provide the information required for decision makers to

understand the tradeoffs between COAs. In addition, risk planning provides the methods necessary

to determine likelihood and impact of each risk and facilitates completing mitigation planning to

reduce or avoid a risk occurrence. Completing the process thoroughly and thoughtfully will assist

with product support planning and ensure mission support requirements are executed at an

acceptable cost level.

68 DAFPAM63-123 14 APRIL 2022

Chapter 8

DETERMINING EVALUATION FRAMEWORK, WEIGHTING, AND SCORING

8.1. Weighted Utility Score (WUS) and Multi-Objective Decision Analysis (MODA). The

preferred methodologies for evaluating COAs are the Weighted Utility Score (WUS) and the

Multi-Objective Decision Analysis (MODA). The two methodologies have similar steps but the

level of information, calculation of results, and displays of results differ. If an alternate method is

used, it should be fully documented and coordinated with the Executive IAP (refer to the Roles

and Responsibilities for the PS-BCA governance structure in Section 2).

8.2. COA Evaluation. This section addresses the approach for evaluating various COAs with

respect to the top-level categories of cost, benefit, and risks. The first requirement in using the

WUS framework is to give relative importance/value (weighting) between cost, benefit, and risks

and receive approval of the weighting from the Executive IAP. The relative balance in weighting

is used to frame the PS-BCA assessment of the various COAs. In a fiscally constrained

environment it cannot be “benefits/performance” at any cost or “lower cost” with inadequate

“benefits/performance.” The Executive IAP prevents the perception of gaming and safeguards the

integrity of the results by approving weighting before collecting data. The goal is to make the

COA assessments unbiased.

8.2.1. WUS. The WUS is a summation of the weighted top-level categories of cost, benefit

and risk, based on a 100-point scale. For the notional example below, the relative balance

(weighting) is: cost = 35, benefit = 45, and risks = 20.

Figure 8.1. Weighted Utility Score (WUS).

DAFPAM63-123 14 APRIL 2022 69

Figure 8.2. WUS Framework - No Weighting Assigned.

8.2.1.1. An example of the initial WUS framework with all the weightings assigned is

shown in

Figure 8.3. WUS Framework – Criteria Weighting (Notional Data).

70 DAFPAM63-123 14 APRIL 2022

Figure 8.4. MODA Framework – Criteria Weighting (Notional Data).

8.2.1.2. When using the MODA framework, the benefits hierarchy focuses on benefits and

cost remains independent. The benefits hierarchy in MODA is different than the one in

WUS.

8.3. Steps to Build the WUS or MODA Framework. Identify sub-categories under each top-

level category for cost, benefit, and risks. If appropriate, include any additional sub-category

levels. In the example above, sub-categories under “Benefit” are SE, SCM, and Maintenance

Management. For the sub-category Maintenance Management, there are four additional sub-

categories (Aircraft, Engine, Software, Commodities).

8.3.1. Cost. Identify sub-categories under cost, however, they are not always required as

demonstrated in the above example.

8.3.2. Benefit. The sub-categories should be consistent with those defined in the scope for

IPS elements or grouping of IPS elements. For example, the benefits which may have been

identified are SE, SCM, and Depot Maintenance Management.

8.3.3. Risks. The sub-categories should match those identified in the previous Risks section.

Examples of the risk sub-categories are Transition (complexity, manpower, time, etc.),

Environmental (political), Compliance with 50-50 or core laws, Investment, etc.

8.3.3.1. Identify metric(s) to measure the last/lowest category (if no sub-category) or

last/lowest sub-category level.

8.3.3.2. After identifying the levels of sub-categories, determine the metrics that will

measure each category level. As each metric is identified, document the rationale for

selecting the metric for stakeholder/advisor understanding.

DAFPAM63-123 14 APRIL 2022 71

8.3.3.3. Although multiple cost metrics can be considered when determining the preferred

alternative, the cost analyses for the alternatives will be compared using dollars that have

been discounted to present value.

8.3.3.4. Questions that can assist in identifying metrics include:

8.3.3.4.1. Is the metric objective/quantitative or subjective/qualitative (Use

objective/quantitative when available)?

8.3.3.4.2. Is the metric a direct measurement or will it be a surrogate measurement?

8.3.3.4.3. Is the metric data auditable?

8.3.3.4.4. Is the metric consistent across all sources (OEM, organic, and 3rd Party)? If

not, what is the mitigation plan?

8.3.3.4.5. Is the metric a discriminator? For example, the result from a metric under

SCM sub-category will discriminate (which is better) between organic, OEM, or 3

Party suppliers.

8.3.3.5. These metrics should be applicable to the “as-is” COA since the “as-is” COA is

the starting point for the PS-BCA. The metrics should effectively align with the mission

and contribute to meeting the PS requirements. It is important to exercise caution when

selecting a combination of metrics to ensure they are not redundant or counteractive. It is

recommended to use the SMART approach to measure metrics in the last/lowest sub-

categories.

8.3.3.5.1. S = Specific: The value of the metric should be clear to avoid

misinterpretation and it specifies the allowable range or threshold.

8.3.3.5.2. M = Measurable: The unit of measure is specified and tied to the underlying

data that allows for meaningful statistical analysis.

8.3.3.5.3. A = Attainable: For the “as-is” COA and the “to-be” COAs, the metric

should be achievable, reasonable, cost-effective, and credible.

8.3.3.5.4. R = Relevant: The metric should be valued to the program and “as-is” state

of the program’s PSS. This metric should already be tied to mission and PS-BCA

requirements and appropriate to a specific level of scope and responsibility.

8.3.3.5.5. T = Timely: The required data can be collected and analyzed within the

established time frame.

8.3.4. Determine Data Sources. Determine data sources for each metric and ensure all sources

have the same parameters and definition. For metrics, any difference in the parameters and

definition (i.e., differences between organic data collected and contractor data collected)

should have a mitigation plan before scoring or weighting. The data sources should be

documented with the rationale for each metric from above (See example for CWT below in the

section “Written Common Understanding and Frame of Reference”).

8.3.5. Determine weighting and scoring plan. As previously stated, only use the benefit sub-

category for weighting within the MODA framework.

8.3.5.1. The weighting and scoring plan should be developed by a select group of critical

experts (CEs). Any stakeholder or advisor who is a CE with a business interest in the PS-

72 DAFPAM63-123 14 APRIL 2022

BCA result should not be included in the select group which determines the weighting and

scoring plan to prevent a product support provider conflict of interest or an organizational

conflict of interest. For MODA, only use the benefit sub-category for weighting.

8.3.5.2. The scoring and weighting methodology should be approved by the Executive

IAP. The scoring plan should be completed prior to data collection. It is recommended

that until the data is collected, the scoring and weighting methodology not be shared outside

the select group and the Executive IAP. Not sharing this methodology preserves the

integrity of data collection, weighting, and scoring processes.

8.3.5.3. Weighting Approach: The select group of CEs should begin to determine the

weighting values for each category, sub-category, and metric.

8.3.5.4. It is very important that for each sub-category/metric to ensure the cumulative

impact is appropriate as determined on WUS (especially if sub-category/metric is used

more than once).

8.3.5.5. In the Figure 8.5, the cumulative impacts are shown in the first three columns.

The weightings and metrics shown are examples only.

Figure 8.5. Cumulative Impacts of WUS.

DAFPAM63-123 14 APRIL 2022 73

Figure 8.6. Updated WUS Framework.

8.3.6. Critical Expert Considerations. Based on the revised weighting, the updated WUS

framework for assessing cost, benefit, and risks. To prioritize the values for weighting across

sub-categories or metrics, CEs need to have a common understanding of reference for each

sub-category and metric. Below are some, but not all, considerations to be provided to the

CEs.

8.3.6.1. Written parameters and definitions for each sub-category and metric to be

weighted. The SMEs should understand any difference in the metric parameters and

definition (i.e., differences between the organic metric collected and the contractor metric)

and the mitigation plan to enable equity before scoring or weighting.

8.3.6.2. Example: CWT for the government is defined as the time between when the unit’s

request for a part was initiated to when the part was delivered to the unit. CWT for a

contractor may be defined as the time between when the contractor gets the request from

the government for the part to when it delivers the part to a port. In this example, the

parameters and definition for CWT is not the same. A mitigation plan is required before

using CWT as a sub-category or metric. The mitigation can be an actual correction or an

estimate correction, but if possible, an actual correction is preferred and should be weighted

more.

8.3.6.3. Whether the sub-category or metric is an objective/quantitative or

subjective/qualitative measure. Objective/quantitative is preferred.

8.3.6.4. Whether the sub-category or metric is a direct measurement or an indirect

measurement for the desired outcome. Direct measurement is preferred.

74 DAFPAM63-123 14 APRIL 2022

8.3.7. Additional Considerations. The following is a list, but not an all-inclusive list, of

additional considerations that needs addressing when using CEs to accomplish the weighting:

8.3.7.1. CEs’ inputs should only apply to their areas of expertise.

8.3.7.2. Retain the ability to identify each CE’s input for later sensitivity analysis.

8.3.7.3. Ensure equitable CE impact – one CE, or one organization CE group, should not

be able to independently influence results.

8.3.7.4. Ensure CEs are of an appropriate level and expertise (consideration of experience

and position).

8.3.8. Scoring Approach: After identifying the quantitative and qualitative categories and

metrics, the selected group of SMEs then determine the scoring plan for each category and

metric. Below are some examples of some common “how to” methods to score responses

mathematically.

8.3.9. Numerical Responses. Numerical responses are normalized using either the maximum

or minimum score across a metric. The following is how this scoring can be determined:

8.3.9.1. Highest Number is desired. The highest number for all the responses across all

the COAs receives the maximum points. The numbers for the remaining responses should

be scored by linear normalization to the highest number.

8.3.9.2. Lowest Number is desired. The lowest number for all the responses across all the

COAs receives maximum points. This approach should be adjusted accordingly if

averages of the numbers are used to determine the score.

8.3.9.3. Other Scoring. Any other scoring approaches used are explained for that metric.

8.3.9.4. “Yes” or “No” Responses. Where “Yes” response is desired. Scoring: “Yes”

answer receives all the points.

8.4. Displaying the Results – WUS and MODA (Cost Capability Analysis). Choosing how to

display the results is important. Some decision makers prefer seeing “numbers” (WUS), while

others prefer a more visual display (MODA) of the results, and yet others prefer seeing both

displays. Both methods are discussed in the following sub-sections.

8.4.1. Displaying WUS Results. When assessing the WUS results, one should understand what

a higher score represents. For example, take the Internal Rate of Return (IRR) and investment

cost metrics - a higher IRR is better, while a lower investment is better. Therefore, a higher

IRR and a low investment cost will each result in a higher WUS number/value, however, this

scoring method sometimes may be counter intuitive. To help understand the WUS

number/value for both cost and risk, these areas are also colored (high cost or high risk is

colored Red; medium cost or medium risk is colored Yellow; low cost or low risk is colored

Green). The “color coding” for each cost and risk is independently determined based on the

sub-categories and metrics for each area. Documenting the rationale for the color coding of

each area is required.

8.4.1.1. In the example, total WUS weighting for risk is 20. Using the risk cube framework

(Figure 8.7): High risk has a score of 4 or less, medium risk a score between greater than

4 and less than 10, and low risk has a score greater than equal to or greater than 10.

DAFPAM63-123 14 APRIL 2022 75

Figure 8.7. Risk Cube.

Figure 8.8. COA Weighting.

76 DAFPAM63-123 14 APRIL 2022

Figure 8.9. WUS Display (Example 1).

Figure 8.10. WUS Display (Example 2).

DAFPAM63-123 14 APRIL 2022 77

8.4.1.2. WUS Assessment.

8.4.1.2.1. Assessing the total score across the COAs, COA 2 and COA 3 have the

highest scores, 55 and 54 respectively. These values are almost the same, however, the

components (Cost, Benefit, Risks) of the score should also be assessed for the complete

context and understanding.

8.4.1.2.2. Assessing benefits between COA 2 and COA 3, COA 3 (WUS = 32) has

more than twice the benefits compared to COA 2 (WUS = 15); therefore, COA 3 is

better than COA 2 based on benefits.

8.4.1.2.3. Assessing the cost between COA 2 and COA 3, COA 2 (WUS = 23) scored

almost twice as high as COA 3 (WUS = 13); therefore, COA 2 is better than COA 3

based on cost. Also, COA 3’s NPV is $2M more than COA 2.

8.4.1.2.4. Assessing the risk between COA 2 and COA 3, COA 3 (WUS = 9) has

almost twice the risk score compared to COA 2 (WUS =17), therefore COA 2 is better

than COA 3 based on risk.

8.4.2. Displaying MODA Results.

8.4.2.1. When using MODA, benefits are plotted against the NPV rather than just against

the single cost of implementing a COA. Comparing benefits only to cost can be misleading

in determining best value. For example, COA 1 can have low one-time implementation

costs with high recurring costs with little savings over the life-cycle; while COA 2 can have

high one-time implementation costs with lower recurring costs and high savings over the

life-cycle.

8.4.2.2. Converting WUS benefits for MODA graphing. In the example, the total WUS

weighting for benefits is 45 (Qualitative plus Quantitative). Therefore, for each COA the

associated WUS benefit score is converted to a total benefit scale of 100 point resulting in:

COA 1 = 26.7, As Is= 24.4, COA 2 = 33.3, COA 3 =71.1, and COA 4 = 75.6. Each COA

is plotted where the benefit score is on the Y-axis and the NPV is on the X-axis. The risk

color for each COA is then overlaid on the graph. Using the NPV for the COAs takes these

costs and savings into consideration. Thus, plotting benefits against NPV for each COA

and then overlaying risk for each COA helps decision makers determine which COA is the

best value. In the example, for each COA the benefits are given a weighted score and then

plotted against NPV. The risk is color coded and displayed. The size of the risk area shown

is directly related the WUS for risk.

78 DAFPAM63-123 14 APRIL 2022

Figure 8.11. MODA.

8.4.2.3. Both COA 3 and COA 4 have higher benefits (over twice the benefit score

compared to the other COAs). COA 3 has medium risk while COA 4 has high risk.

8.4.2.4. COA 1, COA 2, and “as-is” have low risks and lower benefits.

8.4.3. Both the WUS and MODA Overall Assessment. The tradeoff for the decision maker

between COA 2 and COA 3 is what is more important: Higher benefits or lower cost and/or

lower risk. If high benefits is the most important and the medium risk is acceptable, then COA

3 is the better COA. If lower costs and/or lower risk are more important, then COA 2 is the

better COA. The decision makers conducts the tradeoff evaluation and selects the better COA

accordingly.

8.4.4. Summary of Key Points.

8.4.4.1. As each sub-category and metric is identified, document the rationale for its

selection.

8.4.4.2. Ensure that for each sub-category/metric, the cumulative impact is appropriate as

determined (especially if a sub-category/metric is used more than once).

8.4.4.3. In order to prioritize the values for weighting across sub-category or metrics,

SMEs need to have a common understanding and frame of reference for each sub-category

and metric. Therefore, provide written documentation to the SMEs.

8.4.4.4. Display the results in a clear format that can be easily understood by decision

makers.

DAFPAM63-123 14 APRIL 2022 79

Chapter 9

DATA SELECTION, COLLECTION AND ASSESSMENT

9.1. Quality Data Collection. Within the PS-BCA process, quality data collection is often one

of the most difficult and time consuming activities. In order to perform a quality PS-BCA, the PS-

BCA IPT should clearly understand what data is required and ensure it is available and acceptable

to support the analysis. Even though a program may technically comply with various DoD

Instruction and other sustainment cost reporting requirements, the data collected may not be of

sufficient fidelity to effectively accomplish a cost estimate. Therefore, before any data is collected,

the PMO should document, in a data collection and management plan (data plan), how the team

will locate, collect, verify, and use data to ensure the data is collected at a sufficient level for

effective use in the PS-BCA. The data plan should focus on strategy early in the acquisition

lifecycle. This information is important because it helps the PMO to determine what data is

required for future analysis (e.g., BCAs) and long-term sustainment. This should also assist the

program office in determining which data rights to include in future contracts. The data collection

should include quantitative and qualitative data to support benefit, cost, and risk analyses. The

resulting data plan should be coordinated through the IAP structure to ensure reasonable

expectations are agreed upon by all stakeholders and advisors. PMO should ensure proper

agreements are in place not only for data, but to include acceptable delivery per PMO

requirements.

9.2. Data Selection. For the purposes of the PS-BCA, data selection is defined as the process of

determining the appropriate data type and source to support the analysis. There are two key

components of the data selection process: 1) identification of data requirements and 2) quality

assessment of potential data sources.

9.2.1. Identification of Data Requirements. The first step in developing the data plan is

identifying potential data requirements (both financial and non-financial). The product support

framework, documented in the LCSP, should be the basis for the PS-BCA and data

requirement. During MS-A/B in the life cycle, the intent of the PS-BCA is more closely tied

to creating the initial product support framework and identifying potential data requirements

such as technical data and data rights that will support a more detailed PS-BCA later in the life

cycle. However, for MS-C and beyond, data is more detailed and system specific, and is

collectively agreed to be the most applicable and representative data to support the PS-BCA as

further discussed in the following sections.

Table 9.1. Milestone Data Maturity.

Data Prior to MS-B

Prior to MS-B, the program office ensures the information and data

needed is being captured and be delivered to the government by the

developing contractors.

Data Between MS-B

and MS-C

Between MS-B and MS-C, the program office use the COAs for the

PSS, the proposed methodology, and the delivery of information and

data developed and determined prior to MS-B.

Data Post MS-C

Once MS-C is reached, the program office should have actual data and

the focus should be on identifying any new, updated, and/or changed

data.

80 DAFPAM63-123 14 APRIL 2022

9.2.1.1. The data collected for the PS-BCA will usually be a direct reflection of the

platform maturity but should be reviewed periodically throughout the life cycle to ensure

the data being collected supports the objectives of the PS-BCA. As the system matures,

platform specific data should become more readily available. When completing a PS-BCA

early in the platform lifecycle, specific platform data may not be available. During this

time in the lifecycle, it is an accepted practice to use data from an analogous platform (see

“Using Data from Analogous Systems” tip below). However, when available, more

detailed cost data provides more confidence in the distinctions between COAs resulting in

a higher quality cost estimate. Too often, cost data from the contractor is collected at such

a high level it cannot be used effectively in completing an estimate without major concerns.

For example, in order to accurately estimate the SE cost for a new airframe, one needs

more detailed cost information than the total SE cost for the entire antecedent platform.

Without the break out of specific cost for SE for the airframe, engines, and Depot Level

Repairables (DLRs), a cost analyst has to make what could be a faulty assumption in an

attempt to allocate the specific cost to the airframe. The team should consider using

systems which have a predominately organic sustainment strategy as analogous data points.

9.2.1.2. If contractor data is required, the PSM works closely with cost analysts,

logisticians, and contracting officers to ensure the proper data is contracted for and

executed from the beginning of the life cycle of the program. The PMO should plan to

acquire government rights and the delivery of technical data as required by 10 USC § 2320.

However, if a platform is in the sustainment phase and is being supported by a CLS contract

worth $50M or more (and software efforts greater than $20M), the PMO needs to complete

a comprehensive Cost & Software Data Report (CSDR) plan package in accordance with

DoDI 5000.02. The data collected from the CSDR can then be used as a baseline for the

revalidation or for another study. In addition, tailoring the CSDR allows information to be

collected in a specific area of interest (e.g., airframe SE), giving analysts a quality starting

point to begin an estimate.

9.2.1.3. As data is collected, the PMO executes a cohesive plan for archiving and

efficiently providing the data as appropriate to the various stakeholders/advisors. All

parties should understand how the data choices impact the PS-BCA problem statement.

Not collecting the correct functional and cost data reduces the effectiveness of the PS-BCA

and hinders, delays, or inhibits future decision making efforts. Therefore, having a plan

and a sustained commitment in place to collect the most accurate and useable data as it

becomes available should make the current PS-BCA, and all subsequent PS-BCAs, more

informative and accurate while also minimizing uncertainty or risk.

9.2.1.3.1. The questions listed below can aid the PS-BCA IPT identify potential data

requirements to support the analysis:

9.2.1.3.2. What is the problem statement? What data is needed to properly evaluate

the problem statement?

9.2.1.3.3. What metrics are proposed to support the benefits evaluation? What type of

metric data is needed to support the evaluation of this metric?

9.2.1.3.4. What are the differentiators across the COAs selected? What level of

information/data is needed to effectively evaluate those differences? For example, if

the COA set considers organic versus contractor SCM, what type of data is needed to

DAFPAM63-123 14 APRIL 2022 81

evaluate the different cost, benefit or risks associated with the different product support

providers?

9.2.1.3.5. Are the proposed data elements easily applied across all potential product

support providers (i.e. organic or contractor providers)?

9.2.1.3.6. What are the program’s data rights and/or ease of access to data?

9.2.1.3.7. When will the data be generated? What level of data is needed to

differentiate across the COAs?

9.2.1.3.8. Is there a mitigation plan if the data is unavailable?

9.2.1.4. Quality Assessment of Potential Data Sources. The next step is examining

potential data sources and assessing the quality of the proposed data. The term “quality

data” is defined as data that achieves its purpose or use. Attributes of quality data include

accuracy, precision, completeness, consistency, timeliness, and authority. Table 9.2 and

Table 9.3 below outline the data quality tiers, along with potential PS-BCA data sources

which include corresponding tiers.

Table 9.2. Data Quality Tiers.

Tier 1:

DoD/AF Level

Authoritative Data

Tier 2:

Program or Other

Government Data

Tier 3:

Contractor Data

Tier 4:

SME Survey Data

Data from recognized

authoritative data

base

Typically collected

and tracked across

multiple weapon

systems/programs

Data has been

generated, validated

and used to support

other program level

decisions

Typically collected

and tracked only for

weapon system

program being

assessed

Data has been

validated and/or used

to support other

program level

decisions

Typically collected

and tracked only for

weapon system

program being

assessed

Typically used for

qualitative data

Table 9.3. Potential PS-BCA Data Sources.

Data Source

Tier

Types of Data

When to use?

Location of Data

(Link, POC, etc.)

Logistics

Installations and

Mission Support

- Enterprise

View (LIMS-

EV)

Contains historical

logistics data

Can be used in a

Benefits or Risk

analysis

https://www.my.af.mil

A4P[email protected]

Air Force Total

Ownership Cost

(AFTOC)

Contains historical

cost and logistics

data

1. Costing out

Depot Level

Repairables

https://aftoc.hill.af.mil/

82 DAFPAM63-123 14 APRIL 2022

2. Can be a starting

point for all CAIG

elements

smxg.aftoc.helpdesk@u

s.af.mil

Reliability &

Maintainability

Information

System

(REMIS)

Information on

system reliability

1. Extrapolation or

comparative

analysis

2. Cost estimate

Applicable Air Logistics

Center or Depot

Joint Deficiency

Reporting

System (JDRS)

Information on

material deficiency

history

Cost estimate

http://www.jdrs.mil

Life Cycle

Sustainment

Plan (LCSP)

Sustainment plan

and standard

Cost estimate,

defining baseline

Applicable program

office or PSM

Cost Analysis

Requirements

Description

(CARD)

Information on

previous cost

estimates and

decision making

Cost estimate,

defining baseline

Program office,

Command FMCE or

SAF/FMCE

Condemnation

Expense

Material

Recovery

(CEMR)

Rate for Organic

Supply Chain costs

Cost estimate,

defining baseline

AFSC/FM

Unit Manning

Document

(UMD)

Information on

organic manpower

Cost estimate

Command Manpower

Business

Overhead Cost

Recovery

(BOCR)

Information on

overhead cost

Cost estimate

AFSC/FM

Manpower

Estimate Report

(MER)

Information on

total manpower

needed to operate,

maintain and

support

Cost estimate

Command Manpower

Contractor

CDRLs

Potential input to

benefits, cost and/or

risk assessments

Internal Program Office

Documentation

SME Input

May be used to

support assessment

of qualitative data

Should only be

used if other data

sources not

available to support

assessment and

should only be used

in qualitative

metrics

SME

Survey/Questionnaire

DAFPAM63-123 14 APRIL 2022 83

9.2.1.5. Additional considerations regarding data sources:

9.2.1.5.1. To the maximum extent possible, the authoritative data source should be

accurate and reliable. Manage expectations of desirable data sources to ensure

accuracy, consistency, timeliness, availability, and relevance.

9.2.1.5.2. Make efforts to only use non-proprietary data in a PS-BCA so subsequent

iterations of the PS-BCA can be accomplished or updated.

9.2.1.5.3. Interim Contract Support can be written to collect data which may then be

used for sourcing decisions and costing out Contract Logistics Support

9.2.1.5.4. At the end of the data selection process, the PS-BCA IPT should have a list

of the required data, an identified source, and documented rationale as to why that data

element was selected. Table 9.4 below provides an example format to capture this

information. The PS-BCA IPT should complete a separate table for cost, benefit, and

risks data.

Table 9.4. Example – Data Requirements and Selection.

Data element

(e.g. WBS or

IPSE)

Data Source

POC/Office

Organizational

POC

Level of Data

Quality/Tier

Reason

Source was

Selected

9.2.1.6. Data Collection. Once the necessary data has been identified, the PS-BCA IPT

develops the data collection procedures, collection schedule, entry documentation, data

protection, data access/storage, and mitigation plan if the data is unavailable. Having a

documented data plan is mandatory and is key to ensuring all PS-BCA players have the

appropriate access to data and information. When documenting sources, include the data

source, vendor, point of contact, and the date the data was obtained. Open source data

obtained from the internet should include the website address, product/report number,

contract number (if available), and CDRL (if available).

84 DAFPAM63-123 14 APRIL 2022

Table 9.5. Data Plan Considerations.

Data Plan Areas

Considerations

Data Collection

Establish rules of engagement for collecting data.

Identify who, within the PMO, will be responsible for requesting, collection

and distributing data. It is recommended that this be a single person within

the PMO responsible for the PS-BCA. This individual should be a

government employee, not a support contractor.

Identify entry/exit points for data requests within supporting

stakeholder/advisor organizations (e.g., MAJCOM POCs, Contractors,

AFSC).

If the data is pulled from an automated system, decide who is going to

validate the data pulls. Also, consider what criteria will be used for QA,

validation, etc.

Determine how non-availability of data will be addressed and how issues

will be mitigated.

Decide if data will be provided in hard copy or electronically. If

electronically, will it be in Excel or PDF? MS Office is highly

recommended not only for PMO and analytical purposes, but also for

higher level agency review and oversight.

Determine if a data call is required. It is recommended that a formal request

for data come from the senior decision maker to emphasize the importance

of timely support.

Periodically assess the data being delivered/collected supports upcoming

PS-BCAs

Note: Each functional organization providing data is responsible for the

accuracy and completeness of the data (e.g., 448 SCMW for supply chain

data, AFSC/LG for workload information, AFSC/FZ for organic rates and

cost data, and Defense Contract Audit Agency or Defense Contract

Management Agency for contract cost data).

Collection

Schedule

Determine dates the data is required to support the PS-BCA schedule.

Establish suspense dates for the data requested.

Identify what actions should occur if suspense date is not met.

What levels should this be elevated to in order to resolve missed suspense

dates?

What mitigating actions should be taken to keep the PS-BCA on schedule?

Entry

Documentation

Determine who will be responsible for documentation of data.

Determine how data will be documented:

Date Received/Retrieved

Query Parameters Utilized (if pulled from automated system)

Format Received (hardcopy, electronic, etc.)

Data Storage (SharePoint, etc.)?

DAFPAM63-123 14 APRIL 2022 85

Data Plan Areas

Considerations

Data Protection

Identify any non-disclosure, security issues.

Determine if special access or permission is required before the data is

released.

Data

Storage/Access

Determine if the data will be accessed via a web system, MS Excel, or other

means.

Determine if the data needs to be available to everyone on the PS-BCA IPT.

If not, document the rationale for any exclusion.

9.2.1.7. Provided below are common mistakes that occur in the data collection process:

Failure to be specific when requesting data or misunderstanding of data requirements

regarding the information to be collected.

Ignoring data used in previous estimates (when it applies).

Not using data from preferred or best available sources (i.e. AF or DoD derived data)

when available.

Using manufacturer data that may represent a base case scenario.

Not clearly stating the source and date of the data.

Not presenting data in a format that can be analyzed/recreated by an independent

reviewer.

9.2.2. Data Assessment. Once collected, the team needs to review the data since flawed data

can jeopardize the quality of the PS-BCA. The data received may be different than what was

expected. For example, collecting the actual incurred cost to sustain the platform may provide

better cost visibility for estimating purposes than a negotiated contract cost, although both may

be referred to as ‘actual cost data.’ Therefore, the analyst may need to consider additional data

sources if the data does not meet expectations. Some common errors with data include.

Unexplained gaps (e.g., missing periods of time).

Insufficient data points (e.g., limited use or recording of data).

Limited sample size (i.e., if the data collected was based on a sample).

9.2.2.1. However, before discarding a data source, the analyst should confer with

stakeholders/advisors to determine if a logical explanation exists for the flaw or anomaly

in the data.

9.2.2.2. Once the data is validated by the IPT, the analyst needs to determine if the data

can be used as is or if some adjustment is needed to normalize the data. If normalization

or manipulation is required, an explanation needs to be added to the documentation. For

example, contractor data may be grouped by month or quarter and then averaged, while

organic data may not be modified and is collected in real-time.

9.2.2.3. When completing a PS-BCA early in the lifecycle, specific data may not be

available. During this time in the life-cycle, it is a generally accepted practice to use data

from an analogous platform. However, analogous data is often misused in the following

ways.

An analogy is used that is not representative of the target PSS.

Assumptions are made that cannot be proven with data.

86 DAFPAM63-123 14 APRIL 2022

Incomplete data is used that does not account for all the relevant cost associated with the

COAs.

9.2.2.4. These missteps are often the result of either not having better data on hand or there

is a limited understanding on what the data represents. For new platforms, early in the life-

cycle (MS-A/B), there may not be enough reliable (platform specific) data to accurately

model or forecast future cost, so analogous estimating is acceptable. For new systems with

no clear antecedent platform, the PS-BCA team needs to have even more fidelity to

complete a quality estimate. New systems may need analyzing at the part level to identify

like-and-similar parts which can be effective in projecting the PS-BCA estimate.

9.2.2.5. In this case, it is expected that an analogous platform would be used to gather the

necessary data to complete the PS-BCA estimate. However, the data choices and how they

are applied determine the quality of the estimate. There should be a reasonable and logical

correlation between the analogous system and the targeted system under study as identified

by the PS-BCA team and associated SMEs. Those systems should also be documented in

a manner that demonstrates why the systems are analogous. It should include the rationale

for why the analogy was chosen and why it best supports a particular PS-BCA element. It

is also vital that the data collected from the analogous program be complete and normalized

to a targeted metric that will be used consistently throughout the entire analysis. This

allows for a fair comparison of data sources that can be used to make more accurate

projections. Here are some rules of thumb to keep in mind when using an analogy.

9.2.2.5.1. Is the analogy being applied in a logical and sensible way?

9.2.2.5.1.1. Effective: Using the engine reliability data from Platform A (a turbo

fan engine maintained organically), to predict the engine reliability for Platform B

(which is also a turbo fan engine maintained by a contractor). Both Platforms have

similar engines in size, parts, and capabilities and are overhauled at similar

scheduled time intervals.

9.2.2.5.1.2. Problematic: Using supply chain cost data from Platform A

(contractor), which has different PSS content than Platform B (contractor), because

they have similar engines.

9.2.2.5.2. What to do if an analogous platform is not available for the system under

study, which is common in the Space community?

9.2.2.5.2.1. Effective: Using an established supply chain and sustainment strategy

construct for Platform A that is similar to the targeted supply chain and sustainment

strategy for Platform B. Although the platform may not be an analogous hardware

solution, a successful analogy can still be applied in other creative ways to help

estimate other key elements of the PS-BCA.

9.2.2.5.2.2. Effective: Dividing the system to the part level and then looking for

existing parts that are similar while adjusting for complexity.

9.2.2.6. This approach is only as effective as the cost and technical data collected for the

programs to be utilized in the estimate. Thus, it is important that each platform is properly

documented throughout the entire lifecycle. For example, documenting the growth of the

software maintenance, along with the systems, capabilities, and cost associated with the

DAFPAM63-123 14 APRIL 2022 87

platform would help ensure estimates better project software maintenance cost for the next

generation warfighter or to satisfy the revalidation requirement of the support strategy or

for use in a PS-BCA for a follow-on weapon system. The subjective nature of analogous

estimating drives risk into the estimate. The PS-BCA team should expect to update this

type of estimate with platform specific data in future PS-BCAs.

9.2.2.7. If the data requires special protection (e.g. classified or proprietary), the PS-BCA

team may need to obtain Non-Disclosure Agreements prior to starting the data collection

process. Once data is collected, the team needs to review the quality and quantity of the

data. Data that is not representative of the targeted platform has the potential to jeopardize

the quality of the PS-BCA. The team needs to understand how the data was compiled and

whether there are any known limitations.

88 DAFPAM63-123 14 APRIL 2022

Chapter 10

SENSITIVITY ANALYSIS AND EVALUATION

10.1. Sensitivity Analysis Defined. Estimates of costs and benefits contain uncertainties. Since

estimating errors can be introduced into the analysis because of the uncertainty, the potential

impact of these errors must be analyzed. A sensitivity analysis assesses the extent to which COA

costs and benefits are sensitive to changes in GR&As and data. Every comparative analysis must

have a separate sensitivity analysis (AFMAN 65-506, Paragraph 6.1.2.3).

10.2. Risk and Uncertainty. Risk and uncertainty cannot be avoided because the future is

unknown. While we may have a belief or opinion of what the future value of a variable (i.e.,

assumption, data item) may be, we don’t know for sure, even if our opinion is based on data and

analysis. Therefore, it is necessary to identify how “sensitive” the different COAs are to changes

in GR&As and data. In the case of a PS-BCA, a sensitivity analysis attempts to isolate the effect

of changing a variable’s value across all COAs. Sensitivity analyses should be performed one

variable at a time to see which variables drive large changes in cost and benefits. While adjusting

multiple variables can be done to see their combined effects, this is generally referred to as scenario

analysis rather than sensitivity analysis.

10.3. Variables. A sensitivity analysis is performed for each COA to determine cost and benefit

behavior over the range of key variables’ possible values. Some variables may be GR&As,

weights, or data items. The variables chosen for sensitivity analysis are usually those that are

thought to be cost drivers and those whose values are the most uncertain. In a sensitivity analysis,

the effect of varying the value of only one variable is analyzed at a time. A sensitivity analysis

demonstrates how strong or robust a recommended COA is. A recommendation is said to be strong

or robust if it does not change over the wide range of a variable’s possible values. A sensitivity

analysis may yield one or several cost “cross-over” or “breakeven” points, but a “breakeven

analysis” is not sufficient to be called a sensitivity analysis. A sensitivity analysis is not sufficient

to quantify cost risk.

10.4. Steps in Conducting a Sensitivity Analysis.

10.4.1. Identify the Key Variables to Test. Key variables could be ground rules, assumptions,

benefits rankings/weightings, cost drivers, risks, programmatic objectives, and raw

data/scores. It is also important to address known politically sensitive assumptions and issues.

10.4.1.1. Rankings and weightings can be independent in a PS-BCA. The ranking can be

the order of the benefits in terms of importance, whereas the weighting can be the percent

(%) weight given the benefits in relation to cost and risk.

10.4.2. Perform a Sensitivity Analysis on a Selected Variable (Note: this step should be

repeated for each variable). This step uses two approaches and each approach provides

different information. The first approach, called “graduated” sensitivity analysis, is to vary the

value of the variable and record the results (i.e., output) of the model. This provides insight to

the COA’s cost behavior over the broad range of a variable’s possible values. The second

approach, called “break-even” analysis, identifies the point(s) at which the order of the COAs

change. In other words, this analysis looks at how much each variable can change before there

is a change in the ranking of COAs. Both approaches are valuable to the analysis and provide

the MDA important information.

DAFPAM63-123 14 APRIL 2022 89

10.4.3. Document the Process and the Results. The methodology needs to be documented in

enough detail to enable a reader to replicate the analysis. The analyzed variable, the way it

was varied during the analysis, and the changes to the model’s results (i.e., cost and benefits)

as the value changed should be documented. Document results in the most understandable

format (e.g., table, graph, bar chart, pie chart, etc.). That is, the format in which the results are

presented should clearly convey the “big picture” and the implications for costs, benefits, and

risks.

10.4.4. Repeat. Repeat steps 10.4.2 and 10.4.3 until all key variables identified in Step 10.4.1

have been tested independently.

10.4.5. Evaluate the Results. Sensitivity analysis provides decision makers with a better

understanding of what drives change in costs, benefits, and risks. It can provide information

that can lead to choosing a different COA from that based solely on initial results. If minor

changes in a variable’s value change the recommended COA, the PS-BCA should describe the

circumstances under which the various COAs would be recommended, as well as the

recommended alterative under different objectives (e.g., minimize cost, minimize risk, and

maximize benefits). The goal is to provide the decision maker an understanding of the

circumstances that would lead to the different recommendations under the various different

objectives.

10.5. Examples for Using Sensitivity Analysis.

10.5.1. Example 1 (Graduated Sensitivity Analysis)

10.5.1.1. Scenario: The PS-BCA IPT is attempting to address the risk regarding the

programmatic variable of annual fleet flight hours. The current planning factors are 10,000

hours of historical fleet flight usage.

10.5.1.2. Issue: A steep increase in flight hours will increase the number of scheduled

engine overhauls, which requires maintenance every 1,000 hours.

10.5.1.3. Impact: Organic only option, while previously was the preferred option, may

not be able to handle the anticipated increase in demand to overhaul engines. $350M might

be needed for additional CLS support.

10.5.1.4. Graduated Sensitivity Analysis Technique: What is the effect on maintenance

hours/costs if the flight hours are increased to 15,000 hours? What is the effect on

maintenance hours/costs if the flight hours are decreased to 8,000 hours?

10.5.2. Example 2 (Break-Even Point Analysis).

10.5.2.1. Scenario: Contractor labor rates are not yet known and a generic contractor labor

rate is used.

10.5.2.2. Issue: The contractor labor rate is a highly uncertain variable.

10.5.2.3. Impact: The PS-BCA IPT completes sensitivity analysis and discovers a 35%

increase in contractor labor rates, above organic labor rates, changes COA rankings.

10.5.2.4. Break-Even Point Technique: Changing one variable (in this case contractor

labor rates) across COAs to ascertain the effect on the COA rankings. How much does the

labor rate have to change to affect the COA rankings? What is the impact of the other

90 DAFPAM63-123 14 APRIL 2022

variables as a result of this change? What does the sensitivity analysis results imply about

the relative COA rankings?

10.5.3. Sensitivity Analysis Articulation. Sensitivity analysis should explain what happens to

costs and benefits if an underlying assumption changes or is wrong, or how changes in inputs

(i.e., variable values) impact the output (i.e., order of COAs). Sensitivity analysis should

identify the “what if” scenarios and the confidence range for your analysis results.

10.6. Applying Sensitivity Analysis to Weighting and Scoring of Benefits. While the use of a

disciplined technique for weighting and scoring benefits for the PS-BCA, the process is permeated

by subjectivity due to its inherent nature. As such, the use of sensitivity analysis upon the

weighting factors should be treated as a best practice to determine the margin of variance until the

weighting of benefits warrant a different ranking of results. Sensitivity analysis is designed to

determine if the “solution” is applicable over expected ranges of critical parameters. Those critical

parameters, more specifically, are the weights assigned by SMEs through the weighting and

scoring process of the PS-BCA. The ultimate “solution” between multiple COAs that are very

close in respective benefits can easily be flipped if the rankings are sensitive to marginal value

changes.

10.6.1. Example. As a notional example, assume we have a production line that has

quantitative and qualitative benefits of speed (amount of time to process an end item), capacity,

meantime between repairs, ergonomics, and ability to produce.

Table 10.1. COAs and Attributes.

10.6.1.1. Through the SME weighting process, each attribute or benefit receives a score

between 0-100. Through this process, the following raw weights are derived:

Table 10.2. Raw Weights.

10.6.1.2. Creating a total raw weight score of 300, the respective weights were then

divided by the total raw weight score (300) to develop the proportional weight.

Table 10.3. Scaled Weights.

DAFPAM63-123 14 APRIL 2022 91

10.6.1.3. In this specific scenario, each attribute seeks to maximize the attribute’s value

(i.e., higher qualitative/quantitative values are better). Thus, the attribute value is then

divided by the max attribute value. Example is highlighted below:

Table 10.4. COAs, Attributes, Raw and Scaled Weights.

10.6.1.4. As can be seen in Table 10.4, COA 1 has the highest weighted benefit score,

with COAs 4 and 2 being almost the same, but a distant second and third.

Figure 10.1. COAs Weighted Benefit Scores vs Their Cost.

10.6.1.5. Once the benefits framework has been developed and a weighted score for each

COA has been achieved, the analyst should begin determining the sensitivity of the

weighted score. With sensitivity analysis, we discover that the “solution” COA 1 (ALT 1),

is surpassed in score by COA 4 (ALT 4) when the raw weight for “capacity” is decreased

from 80 to 52 (a change of 35%). The example below highlights this change:

92 DAFPAM63-123 14 APRIL 2022

Table 10.5. Sensitivity Analysis Adjustment.

10.6.1.6. The result of the sensitivity analysis on Attribute 2 would provide a final

“solution” of a weighted score of .8939 for COA 4 (ALT 4) versus .8925 for COA 1 (ALT

1). An important note to make, however, is that when the COAs are compared, COA 4

(ALT 4) is $4M less expensive than COA 1 (ALT 1).

Figure 10.2. COAs Weighted Benefit Scores vs Their Cost after Weight Changes.

10.6.2. Alternative Methods to Preliminary Assessment of Sensitivity. Another approach to

identifying possible criterion that may be sensitive to changes in scoring/weighting is through

the visual analysis of the parameters that make up each COA’s weighted score.

10.6.3. Sensitivity Analysis Display. Figure 10.3 on the left hand side shows the weighted

scores of each of the four COAs. By reviewing the chart, one will find the points scored for

each of the COAs broken out by the scoring criterion. In short, one can visually see the factors

that are driving the total point score. By reviewing this chart, one can see that COA 1’s score

is greatly affected by the second criteria (capacity). It can also be quickly observed that COA

4’s score is not as sensitive to capacity as COA 1’s. As a result, since the weight given to

capacity affects the overall score each COA earns for capacity, a component of the overall

weighted score, the overall weighted score might be sensitive to the weight given to capacity.

The below chart on the right hand side shows the result of applying sensitivity analysis by

changing the weighting factor for capacity from 80 to 52. It is ultimately the analyst and the

PS-BCA IPT’s responsibility to determine sensitivity as it relates to weighting and scoring of

both quantitative and qualitative benefits.

DAFPAM63-123 14 APRIL 2022 93

Figure 10.3. Sensitivity Analysis Displays.

10.7. Applying Sensitivity Analysis to Benefits. The purpose of sensitivity analysis is to test

how robust the results are.

10.7.1. Remove one stakeholder’s/advisor’s vote (or group of stakeholder’s/advisor’s votes)

one at a time and then recalculate the global weights and final COA scores to identify a driver

among the votes.

10.7.2. From the recalculated results, if the order of the COAs change by removing the one

stakeholder’s/advisor’s vote (or group of stakeholder’s/advisor’s votes), then further

investigation should be accomplished to understand why that vote (or group of votes) is a

driver.

10.7.3. If removing stakeholder’s/advisor vote (or group of stakeholder’s/advisor’s votes) one

at a time does not change the order of COAs, then no one vote (or group of votes) has an undue

influence on the results in ranking the COAs.

10.8. Shifting Attribute Scores. Shifting attribute scores between the minimum and maximum

values (e.g., from 0 to 100). The score for each major benefit (e.g., SCM, Maintenance, etc.) is

shifted from the minimum value (0.0) to the maximum value (1.0) and the COA scores

recalculated. Note: For scoring, the maximum value can be shown as 1.0 or as 100 points. Graph

the results of the analysis. The charts below show the results for the major benefits of Supply

Support (SS) and SE where the maximum value is 1.0.

94 DAFPAM63-123 14 APRIL 2022

Figure 10.4. Global Sensitivity Analysis for Supply Support.

10.8.1. What is the likelihood that the values of 0.04 and 0.15 could occur in the data assessed?

If the likelihood is great, then the decision between COAs 7 and 4 is sensitive to the score used

to assess SS. Also, the decision between COAs 3 and 4 is sensitive to the score used for

assessing SS.

Figure 10.5. Global Sensitivity Analysis for Sustaining Engineering.

10.8.2. What is the likelihood that the value of 0.65 could occur in the data assessed? If the

likelihood is great, then the decision between COA 3 and COA 4 is sensitive to the data used

to assess SE.

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10.9. Tipping Point. The purpose of sensitivity analysis is to determine what will happen to the

expected outcome if a key variable were to change.

10.9.1. If the sensitivity analysis does not reveal a change to the PS-BCA recommendation,

then the PS-BCA IPT can be confident that the recommended COA will remain so over the

broad range of values the variable could take on. In other words, the decision maker should

not be concerned over the uncertainty involved with the variable.

10.9.2. If, however, the sensitivity analysis indicates the expected ranking of COAs will

change with relatively small changes in key variables, then the PS-BCA recommendation

would not be stable. If the ranking of the PS-BCA COAs change as a result of changing a

variable’s value, understanding the sensitivity of the element and its relative importance to the

recommended COA is crucial information in the decision support process. The team would

need to focus on understanding the dynamics of this particular variable to address the

uncertainty in the estimate or be ready to have a detailed discussion with the decision maker

as to the likelihood the variable will take on the values that lead to different recommendations.

96 DAFPAM63-123 14 APRIL 2022

Chapter 11

FINDINGS, RECOMMENDATION, APPROVAL AND IMPLEMENTATION FOR THE

FINAL PRODUCT SUPPORT BUSINESS CASE ANALYSIS REPORT

11.1. PS-BCA Report. This section provides guidance on initial findings, recommendation,

governance and MDA approval, and implementation plan for the final PS-BCA report.

Table 11.1. PS-BCA Report Process.

PS-BCA Findings

Recommendation

Governance

Approval

MDA Approval

Program Office

Consolidate Initial

Findings

Program Office

Conduct Findings

Cross Check

Program Office

Document Preliminary

PS-BCA Report

Program Office

Develop and Evaluate

Other Business

Considerations

Program Office

Develop Preliminary

Transition Plans

PM select and Brief

Initial

Recommendation and

Document Rationale

to PS-IPT (minus

PSPs)

Program Office

Develop and Evaluate

Other Business

Considerations

Program Office

Develop Preliminary

Transition Plans

PM select and Brief

Initial

Recommendation and

Document Rationale

to PS-IPT (minus

PSPs)

Approve and

Document Final

Decision and

Implementation Plan

Sign PS-BCA Final

Report

11.2. PS-BCA Findings. The PS-BCA initial findings are data driven results from the analysis.

At this point, the PMO understands the overarching results of the PS-BCA as well as performs a

cross-check to validate the integrity and overall soundness of the PS-BCA.

11.2.1. Findings Summary. At this stage, costs, benefits, and risks need to be evaluated

together either through a MODA or WUS approach.

Table 11.2. Findings Summary.

Work Streams

Benefit

Score

Risk

Cost

(NPV

$M)

PSM

Supply

Sustain

Eng

GOV

0.75

MED

$3,500

GOV

Contract

0.80

LOW

$3,750

GOV

Contract

GOV

0.70

HIGH

$4,000

GOV

Contract

GOV

0.65

MED

$3,800

Contract

0.60

MED

$3,600

DAFPAM63-123 14 APRIL 2022 97

11.2.2. Cross-Check. A cross-check ensures the integrity and overall soundness of the PS-

BCA is maintained. Usually, after the initial findings are collected and displayed, the PMO

identifies outliers and/or key drivers in the analysis. Once outliers and/or key drivers are

identified, the IPT (minus the PSPs) then determines if there are steps that need to be taken

either through sensitivity analysis, additional data samples, etc. to validate the quality of the

data that is causing the outlier and/or key driver. Based on the example in Table 11.2, next

steps could include:

11.2.2.1. What are the key drivers within each of the COAs across costs, benefits, and

risks?

11.2.2.2. What is the driver behind COA 2 having the highest benefit score?

11.2.2.3. What was the quality/certainty in the data that supports that driver?

11.2.2.4. What are key differences in costs between COA 3 and COA 1?

11.2.2.5. Are there any confidence bounds on any of the key drivers? (For example, COA

X projected to have an AO increase of 2% (+/- 1%))

11.2.2.6. Based on the initial findings, are there areas where additional sensitivity analysis

is required?

11.2.2.7. Based on the initial findings are there data procurement recommendations that

would benefit the next PS-BCA?

11.2.2.8. Are there any potential excursions that would aid the decision maker in making

a decision?

11.2.3. Review and Coordination. SAF/FMC is responsible for certifying comparative

analyses meeting the criteria outlined in AFI 65-501, Section 1.5. This includes the analyses

captured in PS-BCAs. Accordingly, the PMO should have their comparative analyses

reviewed and coordinated by the MAJCOM FM and SAF/FMC for ACAT I and special

programs. MAJCOM FM offices should review ACAT II and ACAT III programs. The PS-

BCA final report should include the documented coordination.

11.2.4. PM Recommendation. The PM recommendation should take into account all of the

PS-BCA findings, other business considerations, and preliminary transition plans. The

recommendation should be documented in the preliminary PS-BCA and include detailed

rationale, justification, and supporting information to explain the COA recommendation and

why the submitted COA is recommended over the other COAs. The preliminary PS-BCA

should also summarize the main considerations that contributed to the recommendation.

Finally, the PM recommendation should discuss whether this is a final solution, or if follow-

on projects are necessary to achieve full benefits.

11.2.4.1. Other business considerations are considerations outside the span of control of

the PS-BCA scope and subsequent findings but may be relevant data points to the

governance structure and/or decision maker in making a recommendation determination.

Examples of other business considerations include:

11.2.4.1.1. Loss of critical industrial capabilities

11.2.4.1.2. Preservation of multiple sources of product support capabilities

98 DAFPAM63-123 14 APRIL 2022

11.2.4.1.3. Geo-Political considerations

11.2.4.1.4. Additional sensitive /classified information only known by senior leaders

11.2.4.1.5. Evaluate and determine potential positive or negative impacts to 10 USC

2464 (Core workload) and 10 USC §2466 if each COA were implemented.

11.2.4.1.6. Evaluate and determine potential positive or negative impacts to Working

Capital Fund.

11.2.4.1.7. If a specific skill set is proposed to be outsourced, is there a potential for

the government skill set to atrophy over time?

11.2.4.1.8. Any potential obstacles not already considered that would impede the

implementation of the proposed COA?

11.2.4.1.9. Assessment of potential impacts (positive or negative) to organizations

involved in the transition, implementation and /or execution of the proposed COA.

11.2.4.1.10. Other political impacts that should be considered?

11.2.4.1.11. Summarize potential best practices to include any potential limitations on

the Air Force implementing the best practice available due to laws, regulations or DoD

policy.

11.2.4.2. Funding Impacts. The PS-BCA team should compare the proposed COAs to the

current program budget and consider the funding impact and “Cost to the Program” from

an affordability perspective Note: The Cost of the Program view should be for the total

analysis period; however, comparisons to the budget for the recommended COA would be

primarily for the FYDP. A more detailed funding plan is required for the recommended

COA.

DAFPAM63-123 14 APRIL 2022 99

Table 11.3. Cost to the Program Output Example.

11.2.4.3. Manpower Impacts. In addition to an assessment of the funding/budget, the

potential manpower impact may be a factor the decision maker should consider. While the

manpower for the PMO and user should be available from the Cost Model, quantifiable

impacts to WCF positions may not be easy to determine due to uncertainty of specific

workloads. However, the PS-BCA team may be able to annotate potential risks or

opportunities if specific COAs are selected.

Table 11.4. Alternative Comparisons.

Alternative 1

Alternative 2

Alternative 3

Alternative 4

Alternative 5

AFLCMC

+/- #

AFNWC

+/- #

SpOC/SSC/ECP

+/- #

Other PSP

+/- #

User

+/- #

11.2.5. Preliminary Transition Plans. The preliminary Transition Plan should be laid out to

show the major events/changes that are required to take place during the transition from the

“as is” to a given COA. Assess changes in work streams or “Transition events” to determine

actions required to implement proposed changes (i.e.: contract, funding/budgeting, manpower,

facilities, training, enter into data systems, etc.). Ensure PS-BCA Risk Assessment and

Mitigation Plans are reflected in transition planning.

100 DAFPAM63-123 14 APRIL 2022

11.2.5.1. Evaluate cost model to ensure transition plan aligned with cost model estimates.

11.2.5.2. Identify potential critical path for implementation (may be considered an off

ramp in final implementation plan).

Figure 11.1. COA Example for Transition Plans.

11.2.6. Governance Approval.

11.2.6.1. PM Brief to Governance Structure. Through the governance structure process,

the PM should summarize the analysis methodology and approach, PS-BCA IPT (minus

PSPs) initial findings and recommended COA with supporting justification and rationale

to include other business considerations and key contributors to the PM’s recommendation.

During this time, the governance structure members should provide concurrence on 1) the

PS-BCA IPT (minus PSPs) initial findings and 2) the PM’s recommendation. If the

governance structure identifies concerns with the PS-BCA IPT’s (minus PSPs) findings,

the PS-BCA IPT (minus PSPs) may be directed to perform additional cross-checks to

ensure their findings are sound. If the governance structure agrees with the findings but

does not concur with the PM’s recommendation, the governance structure members should

provide their rationale to the PM and those concerns should be taken forward along with

“views of others” to the MDA for consideration prior to a final decision being made.

Table 11.5. Outline for PS-BCA Out-Brief.

Section

PS-BCA Out-Brief Outline

Bottom Line Up Front (BLUF)

Overview of Program

PS-BCA Team Membership

Problem Statement

DAFPAM63-123 14 APRIL 2022 101

Section

PS-BCA Out-Brief Outline

Scope – Product Support Elements/Grouping

Facts, Ground Rules, and Assumptions (GR&As)

Ground Rules

Assumptions

Defined COAs

Analysis Findings (COAs compared to “as-is”)

Costs

Benefits

Risks with Mitigation Plan

Overall Perspective

Methodology and Criteria

WUS and/or MODA; or Another Approved Method

Evaluation Structure and Criteria (e.g., Weighting)

Metrics

Sensitivity Analysis & Cross-Check

Rationale for selecting the drivers to conduct the sensitivity analysis

Driver or drivers that would change the relative ranking of COAs

Amount of sensitivity of driver or drivers (e.g., Factor of Change to Data – 2 times,

3 times, etc.)

Other Business Considerations (e.g., Political, Financial)

Finding Summary

Recommendation

Off-ramps if recommendation cannot be implemented and/or benefits cannot be

achieved

Way Ahead

11.2.6.2. Outline for PS-BCA Final Report. The PS-BCA final report ensures the PS-BCA

is fully documented per project objectives, including methodologies that are repeatable and

traceable, and provides formal documentation of PS-BCA analysis and findings. The PS-

BCA final report at this stage should document the overall approach, methodology and

thought process that went in to the analysis up to this point to include the initial findings

and supporting cost model. This includes Subject Matter Expert (SME) rationale for the

benefit analysis, weighting and scoring, and any other facets of the analysis where SMEs

are utilized. The PS-BCA final report should be presented in the prescribed outline with

the appropriate information that explains in detail how the PS-BCA was completed, the

methodology, define the COAs and define the associated risk and benefits used throughout

the PS-BCA.

102 DAFPAM63-123 14 APRIL 2022

Table 11.6. PS-BCA Final Report Outline.

Section

PS-BCA Final Report Outline

Executive Summary

Introduction

Problem Statement

Background

Scope

Desired Outcomes and Requirements

Desired Outcomes

Requirements

Assumptions and Methods

Facts, Ground Rules, and Assumptions (GR&As)

Analysis Methods, Tools, and Rationale

Evaluation Criteria

Courses of Action (COAs)

Current Baseline/Anticipated Initial Support/Status Quo

Other COAs

Mission and Business Impacts

Benefits and Non-Financial Analysis

Cost and Financial Analysis

Risk Analysis and Mitigation Plans

Risk Analysis

Mitigation Plans

Sensitivity Analysis & Cross-Check

Conclusion

Comparison of COAs

Summary of Results

Recommendations

Specific Actions Based on Business Objectives

Implementation Plan

11.2.6.3. Implementation Plan. In support of the MDA decision process, the PM should

develop a detailed implementation plan for the recommended COA only. The

implementation plan builds and expands upon the preliminary transition plan for the

recommended COA. The development of the PS-BCA Implementation Plan includes a

Communications Plan, Project Plan, Budget Plan, Change Management Plan (including

Stakeholder Action Plan), and Training Plan. The PMO should develop an executable

implementation plan, detailed schedule and off-ramps for implementing the approved PS-

BCA COA. The PMO should identify each task required to implement the solution and

ensure a timeline/schedule for each task is developed and that a fully integrated schedule

is established for full implementation of the approved COA. Reference AFMAN 65-506,

Section 7.8, for additional discussion on information and activities that are important for

implementing a decision.

DAFPAM63-123 14 APRIL 2022 103

Table 11.7. Implementation Plan Outline.

Section

Implementation Plan Outline

Management Overview

Description of Implementation

Points of Contact

Configuration Management

Major Tasks to Implement the Recommendation

Detailed Schedule

Timeline for Each Task

IMS for overall plan (integrated across all tasks)

Security

System Security Features

Security During Implementation

Implementation Support

Hardware

Software

Facilities

Material

Personnel Requirements/Staffing

Training

Implementation Team

Users if Required

Performance Monitoring

Implementation is on schedule and on cost

Recommendation will meet cost and performance benefits from PS-BCA

Off-Ramp Plan

Go/No Go Decision

Post Implementation Verification

11.2.6.4. Off-Ramps. The PMO should ensure there are off-ramps built into the plan in

case something occurs that prohibits execution of the recommended COA. Off- ramps are

decision points with potential alternate solutions that can be implemented if conditions

change (for example: if needed funding is not received, what is the alternate solution?).

Status updates, changes to the implementation plan, and any decision not to continue to

execute approved COA for any reason should be briefed through the governance structure

and ultimately approved by the MDA to ensure all parties understand the changes and

concur.

104 DAFPAM63-123 14 APRIL 2022

11.2.7. Milestone Decision Authority (MDA) Approval.

11.2.7.1. MDA Decision and Documentation. The PM is responsible to present the

recommendation, Governance approval (to include any “views of others”) and the

implementation plan to the MDA. Via an Acquisition Decision Memorandum (ADM), the

MDA should provide sufficient information so that the PM has formal documentation of

the final decision, to include implementation trigger points (i.e., off-ramps) that would

require the PM to come back to the MDA.

11.2.7.2. PM Update and MDA Sign PS-BCA Final Report. Following the MDA decision,

the PM should document the final decision and any supporting rationale in the PS-BCA

report and attach the ADM if required. If the MDA decision is different than the PM’s

recommendation, the PM should document the MDA decision and rationale and update the

implementation plan to reflect the MDA’s approved COA. At this point, the PS-BCA

report is now considered final and should be sent to the MDA for approval and signature.

Once approved, the PS-BCA final report is attached to the Life Cycle Sustainment Plan as

an annex. Implementation and execution should be monitored IAW with the approved

implementation plan.

DARLENE J. COSTELLO

Principal Deputy, Assistant Secretary of the Air

Force

(Acquisition & Logistics)

DAFPAM63-123 14 APRIL 2022 105

Attachment 1

GLOSSARY OF REFERENCES AND SUPPORTING INFORMATION

References

10 U.S.C. 2320, Rights in Technical Data

10 U.S.C. 2337, Life-Cycle Management and Product Support

10 U.S.C. 2460, Definition of Depot-Level Maintenance and Repair

10 U.S.C. 2464, Core Logistics Capabilities

10 U.S.C. 2466, Limitations on the performance of depot-level maintenance of materiel

AFI 63-101/20-101, Integrated Life Cycle Management, 16 September 2016

AFI 65-501, Economic Analysis, 29 October 2018

AFMAN 65-502, Inflation, 30 October 2018

AFMAN 65-506, Economic Analysis, 6 September 2019

DAFPAM 63-128, Integrated Life Cycle Management, 3 February 2021

DoD Directive 5000.01, The Defense Acquisition System, 9 September 2020

DoD Cost Assessment and Program Evaluation (CAPE), Operating and Support (O&S) Cost-

Estimating Guide, September 2020

DoD Product Support Business Case Analysis Guidebook, April 2011

DoD Instruction 5000.02T, Operation of the Defense Acquisition System, 07 January 2015

DoD Instruction 7041.03, Economic Analysis for Decision Making, 9 September 2015

OMB Circular A-94, Guidelines and Discount Rates for Benefit-Cost Analysis of Federal

Programs, 29 October 1992

Abbreviations and Acronyms

3PL—Third Party Logistics

50/50—Distribution of Depot – Level Maintenance

A4—Logistics Directorates

Ao—Operational Availability

ADM—Acquisition Decision Milestone

AA—Aircraft Availability

ACAT—Acquisition Category

ACI—Analytical Condition Inspection

AF—Air Force

AFCAA—Air Force Cost Analysis Agency

106 DAFPAM63-123 14 APRIL 2022

AFI—Air Force Instruction

AFLCMC—Air Force Life Cycle Management Center

AFLCMC/LG—Air Force Life Cycle Management Center Logistics Directorate

AFMAN—Air Force Manual

AFMC—Air Force Materiel Command

AFNWC—Air Force Nuclear Weapons Center

AFREM—Air Force Enterprise Risk Management

AFSC—Air Force Sustainment Center

AFSC/CC—Air Force Sustainment Center Commander

AFSC/FZ—Air Force Sustainment Center Cost Estimating

AFSC/LG—Air Force Sustainment Center Logistics Directorate

AFTOC—Air Force Total Ownership Cost

AHP—Analytical Hierarchy Process

AIS—Automated Information System

Ao—Operational Availability (Aircraft)

ATS—Automated Test System

BCA—Business Case Analysis

BLUF—Bottom Line Up Front

BOCR—Business Overhead Cost Recovery

CAE—Component Acquisition Executive

CAPE—Cost Assessment and Program Evaluation

CDD—Capability Development Document

CDRL—Contract Data Requirements List

CE—Critical Expert

CEMS—Comprehensive Engine Management System

CER—Cost Estimating Relationship

CLS—Contractor Logistics Support

COA—Course of Action

CPD—Capabilities Production Document

CSA—Commercial Service Agreements

CSDR—Cost & Software Report

CWT—Customer Wait Time

DAFPAM63-123 14 APRIL 2022 107

DAB—Defense Acquisition Board

DLA—Defense Logistics Agency

DLRS—Depot Level Repairables

DoD—Department of Defense

DoDI—Department of Defense Instruction

DSOR—Depot Source of Repair

EN—Engineering

FAR—Federal Acquisition Regulation

FM—Financial Management

GO/SES—General Officer/Senior Executive Service

GR&A—Ground Rules and Assumptions

HAF—Headquarters Air Force

HQ AFMC—Headquarters Air Force Materiel Command

IAP—Incremental Approval Point

IAW—In Accordance With

ILA—Independent Logistics Assessment

ILCM-EF—Integrated Life Cycle Management – Executive Forum

IPS—Integrated Product Support

IPT—Integrated Project Team

IRR—Internal Rate of Return

KPP—Key Performance Parameter

KSA—Key System Attribute

LCCE—Life Cycle Cost Estimate

LCL—Life Cycle Logistics

LCSP—Life Cycle Sustainment Plan

LIMSEV—Logistics Installations and Mission Support – Enterprise View

MAIS—Major Automated Information Systems

MAJCOM—Major Command

MDA—Milestone Decision Authority

MDAP—Major Defense Acquisition Program

MER—Manpower Estimate Report

MFR—Memorandum for Record

108 DAFPAM63-123 14 APRIL 2022

MICAP—Mission Impaired Capability Awaiting Parts

MOA—Memorandum of Agreement

MODA—Multi-Objective Decision Analysis

MOU—Memorandum of Understanding

MS—Milestone

NPV—Net Present Value

O&S—Operation & Support

OEM—Original Equipment Manufacturer

OMB—Office of Management & Budget

OSD—Office of the Secretary of Defense

OT&E—Organize, Train, and Equip

P/CS—Probability & Consequence Screening

PAA—Primary Aircraft Authorized

PDM—Programmed Depot Maintenance

PEO—Program Executive Officer

PK—Contracting

PM—Program Manager

PMO—Program Management Office

POAM—Plan of Actions and Milestones

POC—Point of Contact

POE—Program Office Estimate

PPP—Public-Private Partnership

PS—Product Support

PSS—Product Support Strategy

PSA—Product Support Arrangement

PSBCA—Product Support Business Case Analysis

PSM—Product Support Manager

PSP—Product Support Provider

PV—Present Value

REMIS—Reliability & Maintainability Information System

S4—Space Logistics Directorate

SAE—Service Acquisition Executive

DAFPAM63-123 14 APRIL 2022 109

SAF/AQ—Assistant Secretary of the Air Force (Acquisition)

SAF/AQD—Assistant Secretary of the Air Force / Product Support and Logistics

SAF/AQI—Assistant Secretary of the Air Force / Directorate of Information Dominance

SAF/AQP—Assistant Secretary of the Air Force / Directorate of Global Power

SAF/AQQ—Assistant Secretary of the Air Force / Directorate of Global Reach

SAF/FMC—Assistant Secretary of the Air Force / Directorate of Cost and Economics

SAF/FMCE—Directorate of Economics and Business Management

SCM—Supply Chain Management

SE—Sustaining Engineering

SLOC—Source Lines of Code

SME—Subject Matter Expert

SpOC—Space Operations Command

SSC—Space Systems Command

SSC/S4—Space Systems Command/Acquisition Logistics and Mission Sustainment

SSC/ECP—Space Systems Command/Enterprise Corps

TAI—Total Active Inventory

TY—Then Years

USAF—United States Air Force

USC—United States Code

USD (A&S)—Under Secretary of Defense for Acquisition and Sustainment

USSF—United States Space Force

USSF/S4U—United States Space Force Life Cycle Management

USSF/S4—United States Space Force Logistics, Engineering, and Force Protection

WUS—Weighted Utility Score

Terms

Best Value—Expected outcome of an acquisition that, in the Government’s estimation, provides

the greatest overall benefit in response to the requirement. (Source: Federal Acquisition Regulation

(FAR), Section 2.10.)

Best Value Analysis—An analysis that considers not only cost, but other quantifiable and non-

quantifiable factors to support a decision. This can include, but is not limited to, impact on

readiness, quality and cycle time. (Source: DoDM 4151.23)

Contractor Logistic Support (CLS)—A contractor, rather than the government, is responsible

for the integration of logistic support functions such as providing engineer support, identifying

requirements for spare and repair parts, facilities, materiel, equipment, personnel and performing

110 DAFPAM63-123 14 APRIL 2022

maintenance on weapon systems. The Original Equipment Manufacturer (OEM) often times

provides CLS as well as can provide Product Support Integration (PSI) functions.

Contractor Support—An overarching term that applies to a contractor’s materiel and/or

maintenance support for a system.

Due Diligence—Process of systematically researching and verifying the accuracy of information.

Integrated Product Support Elements (IPS Elements)—The package of support functions

required to deploy and maintain the readiness and operational capability of major weapon systems,

subsystems, and components, including all functions related to weapon systems readiness.

Life Cycle Sustainment Plan (LCSP)—A plan describing sustainment influences on system

design and the technical, business, and management activities to develop, implement, and deliver

a product support package that maintains affordable system operational effectiveness over the

system life cycle and seeks to reduce cost without sacrificing necessary levels of program support.

Milestone-A (MS-A) —Milestone-A is a Milestone Decision Authority (MDA) led review at the

end of the Materiel Solution Analysis (MSA) Phase. Its purpose is to make a recommendation or

seek approval to enter the Technology Maturation & Risk Reduction (TMRR) Phase.

Milestone-B (MS-B)—Milestone-B is a MDA led review at the end of the TMRR Phase. Its

purpose is to make a recommendation or seek approval to enter the Engineering and Manufacturing

Development (EMD) Phase. Milestone B is considered the official start of a program.

Milestone—C (MS-C) - The point at which a recommendation is made and approval sought

regarding continuing an acquisition program, i.e., proceeding to the next phase. MS-C approval

allows entry into the Production and Deployment phase. MS-C authorizes entry into Low Rate

Initial Production (LRIP) (for MDAPs and major systems), into production or procurement (for

non-major systems that do not require LRIP) or into limited deployment in support of operational

testing for Major Automated Information System programs or software intensive systems with no

production components.

Organic—Refers to U.S. government entities (principally DoD organizations) such as

infrastructure, personnel, equipment, and other sustainment capability to support a program.

Product Support Business Case Analysis (PS—BCA) - A PS-BCA is an expanded cost/benefit

analysis with the intent of determining a best value solution for product support. It assesses each

COA and weighs total cost against total benefits to arrive at the optimum solution. The PS-BCA

process goes beyond cost/benefit or traditional economic analyses by documenting how each COA

fulfills the strategic objectives of the program; how it complies with product support performance

measures; and the resulting impact on stakeholders. The PS-BCA identifies which alternative

product support options provide optimum mission performance given cost and other constraints,

including qualitative or subjective factors. The PS-BCA may result in a recommended PSS that is

hybrid blend of both Performance Based Logistics and transactional product support strategies

broken out at the component, sub-system or system level, along with a best value mix of

government and industry capabilities to deliver the 12 IPS elements in an integrated product

support package at affordable cost. (Source: Defense Acquisition University Integrated Product

Support Element Guidebook, Apr 2021).

Public—Private Partnerships (PPP) - A cooperative arrangement between an organic product

support provider and one or more private-sector entities to perform defense-related work, utilizing

DAFPAM63-123 14 APRIL 2022 111

DoD facilities and equipment, or both. There are three basic types of public-private partnership in

use within the defense sustainment community: workshare, direct sale, and lease. The bulk of the

current authorities for partnerships are focused on depot maintenance.

112 DAFPAM63-123 14 APRIL 2022

Attachment 2

LEGACY PROGRAM PRODUCT SUPPORT BUSINESS CASE ANALYSIS

SUFFICIENCY MEMORANDUM

Figure A2.1. Legacy Program Product Support Business Case Analysis Sufficiency

Memorandum.

[Date]

MEMORANDUM FOR RECORD

FROM:

SUBJECT: [program name] Product Support Strategy Assessment

References: (a) Title 10, United States Code, Section 2337

(b) Air Force Instruction 63-101/20-101, Integrated Life Cycle Management

1. The purpose of this memorandum is to document that the [program name] Product Support

Strategy (PSS) is affordable and effective, and that changes to the product support strategy are

not being considered at this time.

2. The [program name] program PSS is within expected costs and performance metrics and is

achieving warfighter requirements. This determination has been validated through review of

the sustainment measurements reported in the [program name] Defense Acquisition Executive

Summary (DAES). The three measurements are: Materiel Availability, Materiel Reliability

and Operating and Support (O&S) Costs. All three Current Estimates (CE) are better than their

respective Current Baseline goals. Specifically, Material Availability CE is [xx%], well above

the Baseline goal of [xx%] and the Material Reliability CE of [xx hours] far exceeds the

Baseline goal of [xx hours]. Similarly, the O&S CE is [$XXB], under the Baseline goal of

[$XXB] (both in BY92$).

3. [Include a brief description of any assessment of the PSS that was accomplished, if

applicable]. The [program name] program office also conducted an assessment to consider

whether alternative PSS might be more affordable or effective. This assessment was

completed on [DATE], and it was found that the current PSS is the best value alternative.

4. In accordance with References (a), (b) and (c), I have determined that the appropriate

analyses have been conducted to validate the PSS and that no further analysis of the [program

name] PSS is necessary at this time.

5. For any questions regarding this memo, please contact the [program name] Product Support

Manager, [PSM Name], at DSN [XXX-XXXX].

Attachment:

[Copy of Assessment (If applicable)]

DAFPAM63-123 14 APRIL 2022 113

Attachment 3

PROCESS NARRATIVE

A3.1. The PS-BCA Process map documents the various steps to assist the PMO in working

through the individual steps of the PS-BCA process.

Figure A3.1. PS-BCA Process Overview.

A3.2. The PS-BCA process narratives consist of the following elements:

A3.2.1. Process Name: Name of process step.

A3.2.2. Process Description: Provides a concise overview of the process step.

A3.2.3. Responsible OPR: The office with primary responsibility is the organizational unit or

individual(s) responsible for ensuring the process step is completed.

A3.2.4. Inputs and Output: For every process step there is a series of inputs. Additionally,

each process step has an output. The final result of the process includes documentation,

correspondence, approvals, etc. to show the process was completed successfully.

114 DAFPAM63-123 14 APRIL 2022

Table A3.1. Develop PS-BCA Project Plan (Process 1.0).

Process Narrative

Process Name:

1.0 Develop PS-BCA Project Plan

Process

Description:

Determine if a new or revalidated PS-BCA is required and begin the

initial development of the project plan

Responsible OPR

PMO (PSM)

Inputs

Outputs

A decision tree to determine if a new or

revalidated PS-BCA is required is located in

the introduction section of the pamphlet

Decision made to conduct a new or

revalidated PS-BCA

If developing PS-BCA:

PMO PS-BCA staffing requirements

PS-BCA IPT Membership

Governance members identified (O-6 &

GO/SES levels)

Preliminary assessment of potential COAs

Draft problem statement

Draft Plan of Actions and Milestones

(POAM) if developing PS-BCA

Table A3.2. Establish Internal PMO PS-BCA Team (Process 1.1).

Process Narrative

Process Name:

1.1 Establish PS-BCA IPT

Process

Description:

Identify appropriate stakeholders/advisors and begin planning and

preparing for a kickoff meeting. The PS-BCA IPT should consist of

stakeholders, support SMEs, and advisors who have a stake or interest in

the outcome of the PS-BCA.

Responsible OPR

PMO (PSM, PS-BCA IPT Lead)

Inputs

Outputs

DAFPAM63-123 14 APRIL 2022 115

Process Narrative

Decision on new or revalidated PS-BCA

made

Initial set of stakeholders/advisors for IPT

identified

Governance members identified

Draft problem statement

Draft POAM

Establish PS-BCA IPT membership

(including contractors if required)

Refine draft problem statement

Draft scope, charter, and agenda (for kickoff

meeting)

Draft facts, ground rules & assumptions

(GR&A)

Update POAM

If revalidation, collect previous data,

assumptions, and update on implementation

of previous PS-BCA

Finalize IPT and Governance membership

Establish date and time for kickoff meeting

and invite stakeholders/advisors

Table A3.3. Kickoff Meeting (Process 1.2).

Process Narrative

Process Name:

1.2 Kickoff Meeting

Process

Description:

Review initial documents and finalize various outputs

Responsible OPR

PSM, PS-BCA IPT Lead

Inputs

Outputs

IPT members received advance copies of the

following draft documents

Kickoff meeting agenda

Charter

Problem statement

Scope

GR&A

Updated POAM

IPT and Governance members identified

If revalidation, collect previous data,

assumptions, and update on implementation

of previous PS-BCA

Charter

Problem statement

Scope

Facts, GR&As

Updated POAM

Schedule O-6 level Governance Incremental

Approval Point (IAP) meeting

Table A3.4. O-6/GS-15 level IAP (Process 1.2a).

Process Narrative

Process Name:

1.2a O-6/GS-15 level IAP

116 DAFPAM63-123 14 APRIL 2022

Process Narrative

Process

Description:

Review and approve IPT’s first incremental work (e.g. Problem

Statement, Scope, GR&A, POAM)

Responsible OPR

PMO (PSM, PS-BCA IPT Lead)

Inputs

Outputs

Problem statement

Scope

Facts, GR&As

Updated POAM

O-6 level Governance approved:

Problem statement

Scope

Facts, GR&As

POAM

Guidance from O-6 level Governance

Schedule Executive level Governance IAP

meeting

Table A3.5. Executive (GO/SES) level IAP (Process 1.2b).

Process Narrative

Process Name:

1.2b Executive (GO/SES) level IAP

Process

Description:

Review and approve IPT’s first incremental work (e.g. Problem

Statement, Scope, GR&A, POAM)

Responsible OPR

Inputs

Outputs

O-6/GS-15 IAP approved:

Problem statement

Scope

Facts, GR&As

POAM

GO/SES level Governance approved:

Problem Statement

Scope

Facts, GR&As

POAM

Guidance from Executive level Governance

Table A3.6. PS-BCA Development (Process 1.3).

Process Narrative

Process Name:

1.3 PS-BCA Development

DAFPAM63-123 14 APRIL 2022 117

Process

Description:

Conduct analysis to develop COAs, evaluation framework, and break

down of categories and sub-categories for each: Costs, Benefits, and Risks

as appropriate

Responsible OPR

PSM, PS-BCA IPT Lead

Inputs

Outputs

Approval from GO/SES level Governance:

Problem Statement

Scope

Facts, GR&As

POAM

Guidance from O-6 and GO/SES level

Governance members

Defined COAs

Defined evaluation framework (no weighting)

Defined costs, benefits, risks categories and

sub-categories as required

Schedule O-6/GS-15 level Governance IAP

meeting

Table A3.7. O-6/GS-15 level IAP (Process 1.3a).

Process Narrative

Process Name:

1.3a O-6/GS-15 level IAP

Process

Description:

Review and approve IPT’s incremental work (e.g. COAs, Defined

Evaluation Framework, Defined Costs, Benefits, Risks categories and sub-

categories as required)

Responsible OPR

PMO (PSM, IPS-BCA IPT Lead)

Inputs

Outputs

Defined COAs

Defined evaluation framework (no weighting)

Defined costs, benefits, risks categories and

sub-categories as required

O-6/GS-15 level Governance approved:

COAs

Evaluation framework (no weighting)

Costs, benefits, risks categories and sub-

categories as required

Guidance from O-6/GS-15 level Governance

Schedule Executive level Governance IAP

meeting

Table A3.8. Executive (GO/SES) level IAP (Process 1.3b).

Process Narrative

Process Name:

1.3b Executive (GO/SES) level IAP

118 DAFPAM63-123 14 APRIL 2022

Process

Description:

Review and approve IPT’s incremental work (e.g. COAs, Defined

Evaluation Framework, Defined Costs, Benefits, Risks categories and sub-

categories as required)

Responsible OPR

Inputs

Outputs

Approval from O-6/GS-15 level Governance:

COAs

Evaluation framework (no weighting)

Costs, benefits, risks categories and sub-

categories as required

Guidance from O-6/GS-15 level Governance

GO/SES level Governance approved:

COAs

Evaluation framework (no weighting)

Costs, benefits, risks categories and sub-

categories as required

Guidance from Executive level Governance

Table A3.9. Metrics Determination (Process 1.4).

Process Narrative

Process Name:

1.4 Metrics Determination with Data Sources

Process

Description:

Define and identify metrics with rationale to assess for costs, benefits, and

risks Note: IPT can reach back to SMEs as required

Responsible OPR

PMO (PSM)

Inputs

Outputs

GO/SES level Governance Approved:

COAs

Evaluation framework (no weighting)

Costs, benefits, risks categories and sub-

categories as required

Guidance from Executive level Governance

Defined metrics and rationale to assess the

lowest level of category or sub-category for:

costs, benefits, and risks

Identified authoritative data sources for each

metric

Schedule O-6/GS-15 level Governance IAP

meeting

Table A3.10. Weighting & Scoring (Process 1.5).

Process Narrative

Process Name:

1.5 Weighting & Scoring

Process

Description:

PMO utilizes a select group of CEs from appropriate sustainment

commands to develop the weighting and scoring plan

DAFPAM63-123 14 APRIL 2022 119

Note: Identified SMEs should have non-disclosure statements. CEs are

those stakeholders, advisors, and/or selected SMEs with an enterprise

view and have expertise across multiple areas.

Responsible OPR

PMO (PSM)

Inputs

Outputs

Defined metrics and rationale to assess the

lowest level of category or sub-category for:

costs, benefits, and risks

Identified authoritative data sources, scoring

approach, and normalization plan if required

for each metric

Weighting for categories and/or sub-

categories for costs, benefits, and risks

Weighting and scoring approach with

normalization plan for each metric

Table A3.11. O-6/GS-15 Level IAP (Process 1.5a).

Process Narrative

Process Name:

1.5a O-6/GS-15 level IAP

Process

Description:

Review and approve PMO’s weighting and scoring plan

Responsible OPR

PMO (PSM)

Inputs

Outputs

Weighting for categories and/or sub-

categories for costs, benefits, and risks

Weighting and scoring approach with

normalization plan for each metric

O-6/GS-15 level Governance approved:

Weighting for categories and/or sub-

categories for costs, benefits, and risks

Weighting and scoring approach with

normalization plan for each metric

Guidance from O-6/GS-15 level Governance

Schedule Executive level Governance IAP

meeting

Table A3.12. Executive (GO/SES) level IAP (Process 1.5b).

Process Narrative

Process Name:

1.5b Executive (GO/SES) level IAP

120 DAFPAM63-123 14 APRIL 2022

Process

Description:

Review and approve PMO’s weighting and scoring plan

Responsible OPR

Inputs

Outputs

O-6/GS-15 level Governance approved:

Weighting for categories and/or sub-

categories for cost, benefits, and risk

Weighting and scoring approach with

normalization plan for each metric

Guidance from O-6/GS-15 level Governance

GO/SES level guidance for the PM and PS-

BCA IPT

Executive level Governance approved:

Weighting for categories and/or sub-

categories for cost, benefits, and risk

Weighting and scoring approach with

normalization plan for each metric

Table A3.13. Collect & Validate Data (Process 1.6).

Process Narrative

Process Name:

1.6 Collect & Validate Data

Process

Description:

Obtain data from authoritative sources and determine effectiveness of data

for analysis

Responsible OPR

PMO (PSM)

Inputs

Outputs

Identified authoritative data sources for each

metric

Guidance from Executive level Governance

Authoritative data with normalization plan as

required (resultant data will have same

parameters and definition from each source)

Table A3.14. PS-BCA Analysis per COA (Process 1.7).

Process Narrative

Process Name:

1.7 PS-BCA Analysis per COA

Process

Description:

Utilize data to conduct PS-BCA analysis for each COA

DAFPAM63-123 14 APRIL 2022 121

Responsible OPR

PMO (PSM)

Inputs

Outputs

Selected CEs for weighting/scoring

Weighting for categories and/or sub-

categories for costs, benefits, and risks

Weighting and scoring approach with

normalization plan for each metric

Authoritative data with normalization plan as

required

Scoring of COAs

Sensitivity analysis

Results/Findings (relative rankings of COAs)

Prepare PS-BCA IPT meeting

Table A3.15. Results/Findings with PS-BCA IPT minus PSPs (Process 1.8).

Process Narrative

Process Name:

1.8 Results/Findings with PS-BCA IPT minus PSPs

Process

Description:

Share results/findings with IPT. IPT lead should ensure PSPs do not have

access to results and findings.

Responsible OPR

PMO (PSM, PS-BCA IPT Lead)

Inputs

Outputs

Scoring of COAs

Sensitivity analysis

Results/Findings (relative rankings of COAs)

IPT comments and guidance

Prepare for O-6/GS-15 level Governance IAP

meeting

Schedule O-6/GS-15 level Governance IAP

meeting

Table A3.16. O-6/GS-15 level IAP (Process 1.8a).

Process Narrative

Process Name:

1.8a O-6/GS-15 level Governance IAP

Process

Description:

Share results/findings with O-6/GS-15 level Governance resulting in

approval

Responsible OPR

PMO (PSM, PS-BCA IPT Lead)

Inputs

Outputs

122 DAFPAM63-123 14 APRIL 2022

IPT developments:

Scoring of COAs

Sensitivity analysis

Results/Findings (relative rankings of COAs)

Approved scoring of COAs

Approved sensitivity analysis

Concurrence on PS-BCA IPT’s initial

findings and PM’s recommendation (if

Governance non-concurs with PM’s

recommendation, incorporate changes or note

“views of others”)

Guidance from O-6/GS-15 level Governance

Sufficient information/feedback to prepare

GO/SES level Governance IAP meeting

Schedule Executive Governance IAP meeting

Table A3.17. Executive (GO/SES) level IAP (Process 1.8b).

Process Narrative

Process Name:

1.8b Executive (GO/SES) level IAP

Process

Description:

Share results/findings with GO/SES level Governance resulting in

approval

Responsible OPR

Inputs

Outputs

O-6/GS-15 level Governance approved:

Scoring of COAs

Sensitivity analysis

Results/Findings (relative rankings of COAs)

Guidance from O-6/GS-15 level Governance

Approved scoring of COAs

Approved sensitivity analysis

Concurrence on PS-BCA IPT’s initial

findings and PM’s recommendation (if

Governance non-concurs with PM’s

recommendation, incorporate changes or note

“views of others”)

Guidance from Executive level Governance

Schedule 3-star level board and determine

participants

Table A3.18. 3-Star Level Review/Approval (Process 1.9).

Process Narrative

Process Name:

1.9 3-Star Level Review/Approval (ACAT I & Selected Programs)

Process

Description:

Share results/findings with 3-star board

Responsible OPR

PEO / PM

Inputs

Outputs

DAFPAM63-123 14 APRIL 2022 123

GO/SES level approved:

Scoring of COAs

Sensitivity analysis

PS-BCA IPT’s initial findings and PM’s

recommendation (or “views of others”)

Guidance from Executive level Governance

3-star level approved:

PS-BCA IPT’s findings

PM’s recommendation (or “views of others”)

Guidance from 3-star level board for input to

Milestone Decision Authority (MDA)

decision

Table A3.19. Final Report Developments (Process 1.10).

Process Narrative

Process Name:

1.10 Final Report Developments

Process

Description:

Develop Draft Final Report and Implementation Plan

Responsible OPR

PMO (PSM)

Inputs

Outputs

3-star level approval on:

PS-BCA IPT’s findings

PM’s recommendation (or “views of others”)

Guidance from 3-star level board

Draft final report to include:

PS-BCA IPT’s findings

PM’s recommendation

Governance approval (or “views of others”)

Implementation plan on directed COA with

detailed schedule and off-ramps

Table A3.20. Approve Recommendations/Draft Final Report (Process 1.11).

Process Narrative

Process Name:

1.11 Approve Recommendation, Implementation Plan, and Draft Final

Report

Process

Description:

MDA Review and Decision

Responsible OPR

PEO

Inputs

Outputs

124 DAFPAM63-123 14 APRIL 2022

Draft final report to include:

PS-BCA IPT’s findings

PM’s recommendation

Governance approval (or “views of others”)

Implementation plan on directed COA with

detailed schedule and off-ramps

MDA decision on the following:

PS-BCA IPT’s findings

PM’s recommendation (to include any “views

of others”)

Implementation plan

Identify any additional implementation off-

ramps noted by the MDA

Rationale for the final recommendation

Sufficient information to finalize PS-BCA

Table A3.21. PS-BCA Document Finalization (Process 1.12).

Process Narrative

Process Name:

1.12 PS-BSA Document Finalization

Process

Description:

Finalize PS-BCA report based on MDA decision and incorporate into

LCSP

Responsible OPR

PMO (PSM)

Inputs

Outputs

MDA decision on the following:

PS-BCA IPT’s findings

PM’s recommendation (to include any “views

of others”)

Implementation plan

Identify any additional implementation off-

ramps noted by the MDA

Rationale for the final recommendation

Sufficient information to finalize PS-BCA

Finalized PS-BCA with supporting rationale

(including Acquisition Decision

Memorandum if required)

If MDA differs from PM’s recommendation,

update implementation plan to reflect MDA’s

guidance

Send finalized PS-BCA report to MDA for

approval and signature

Once signed, attach to LCSP as an annex