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> Home / Acquisition Topics / Business, Cost Estimating and Financial Management / CAIV / Cost as an Independent Variable / Using Risk Management to Assess Performance/Cost Trades for a Nuclear Weapons Program

Using Risk Management to Assess Performance/Cost Trades for a Nuclear Weapons Program

Using Risk Management to Assess Performance/Cost Trades for a Nuclear Weapons Program

Organization: DRPM Strategic Systems Programs, DOE Sandia Nation

Team Name: W76/MK4 Reentry Body Arming and Fuzing Team

Related Acquisition Topic(s): Commercial and Non Developmental Items (CANDI), Cost As an Independent Variable (CAIV), Financial Management, Integrated Product Teams (IPT), Integrated Product and Process Development (IPPD), Risk Management

Description:

The W76/MK4 Reentry Body deployed on the TRIDENT Strategic Weapon System comprises the bulk of the Nation's Strategic Deterrent and is now reaching its original design life. The cost of producing a new reentry body is prohibitive; therefore, continued high confidence in this deterrent must be preserved through the life extension of critical components in the system. The Arming and Fuzing (A&F) subsystem is one of the critical components of the W76/MK4 Reentry Body requiring life extension.

Strategic Systems Programs conducted a joint effort with the Department of Energy (DOE), Sandia National Laboratory (SNL) and its contractors to perform Nuclear Weapons Council approved Design Options and Cost Feasibility Study for a life extended W76/MK4 Reentry Body. This study, in accordance with Dr. Gansler's Acquisition Reform Initiatives, had the primary objective of defining a design approach to achieve the best value for this very critical project. A subsystem IPT was formed to trade-off design concepts, develop selected design options and prepare program plans including detailed cost estimates for a life extended A&F subsystem.

Historically, performance and nuclear safety have had priority over cost in developing and producing reentry bodies. This has fostered a "cultural mindset" in favor of performance achievement that is entrenched in the nuclear community. This effort is the first of its kind to make cost subservient only to nuclear safety. The objective was to apply innovation for cost reduction and to arrive at a "best value" program where performance/cost tradeoffs with associated risks were well understood. Fostering a cultural change was paramount to this effort. To motivate this crucial cultural change, a special award process, was put in place to recognize innovations resulting in cost reduction. To date five (5) awards signed by Director, Strategic Systems Programs and Sandia National Laboratory, Vice President for Weapons Systems have been presented to seventeen (17) individuals.

The effort applied the following principles:

  1. Everything is tradable except nuclear safety.
  2. Development and production unit cost objectives of 50% of previous system costs with a goal of 25%.
  3. Challenged every performance requirement for validity and ensured that its relationship to cost was well understood.
  4. Implemented Cost as an Independent Variable (CAIV) practices.
  5. Encouraged innovation to reduce life-cycle cost.
  6. Manage rather than avoid risk.
  • Innovative design approaches enabling the use of COTS in the nuclear arsenal.
  • Challenge and subsequent elimination of traditional requirements allowing additional cost savings.
  • Interaction with the commercial sector to understand the present and projected marketplace for critical components.
  • Use of alternative test techniques that allow radiation hardness certification without the use of underground tests now prohibited by the Nuclear Test Ban Treaty.
  • Acceptance of risk management in place of risk avoidance while preserving nuclear safety.
  • Selection of a modular design approach for supportability and to allow for flexibility in response to evolutionary requirements over the life cycle.

The cost for the development of the A&F subsystem will be reduced by 60%. The production unit cost met the 25% goal. The total development and production potential cost avoidance resulting from this program as contrasted with previous equivalent programs is up to $750,000,000. This large cost avoidance is made possible by the tenets of Acquisition Reform and by the introduction of cultural changes accepting cost as a program driver. These approaches enabled critical design trade-offs attaining the objective of defining an affordable A&F sub-system, thereby contributing to the preservation of the TRIDENT System as the primary National Strategic Deterrent.

DRPM Strategic Systems Programs, DOE Sandia Nation

W76/MK4 Reentry Body Arming and Fuzing Team



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