Taming Uncertainty in Software Cost Estimation
In 2014, SEI researchers used their Quantifying Uncertainty in Early Lifecycle Cost Estimation (QUELCE) method in a workshop with a live major defense acquisition program (MDAP). This milestone along the way to transitioning innovation into the acquisition lifecycle is the result of focused research and development.
DoD acquisition regulations call for early (pre-Milestone A) estimates that stretch across the entire program lifecycle, including operations and support. These early cost estimates rely heavily on expert judgments about cost factors. In addition, the ways in which cost factors may change through the lifecycle receive little attention.
Based on research initiated in 2011, the QUELCE approach provides an explicit, quantified consideration of the uncertainty of change drivers. In doing so, QUELCE enables calculation (and recalculation) of the cost impacts caused by changes that may occur during the program lifecycle. The result is that this approach enhances decision making through transparency about the expert assumptions that underlie the cost estimate.