This thesis investigates improving military avionics system affordability from an avionics supplier’s perspective. An affordable system is defined as one that meets the customer’s needs for performance and lifecycle cost in a, typically, over-constrained program space – meaning development budget, schedule, performance and lifecycle cost requirements are not all achievable. Over-constrained programs are common in the military avionics industry for two reasons. First, the acquisition process favors over-constrained programs in competitive acquisitions. Avionics suppliers are paid by their customers to develop new systems so new business is awarded on the promise of future capability, not the demonstration of current capability. This process favors optimistic projections of future capability leading to over-constrained
programs. Second, new system development is inherently costly, time consuming and uncertain.
New development programs are always trying to stretch and optimize the
system performance and lifecycle cost to provide significant improvements from
legacy systems within the budget and schedule constraints. Uncertainty exists
regarding the optimal balance of performance and cost. A valuable aspect of a
development program is collaboration between customer and supplier to optimize performance and cost as the uncertainty is gradually reduced. The optimal performance and cost is often different than the program's original goals.
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This thesis aims to improve the management of system development to deliver more affordable systems. Improving affordability is investigated from the avionics supplier’s
perspective. An affordable system is defined as meeting customer needs for performance and lifecycle cost in an over-constrained program space where initial development budget, schedule, performance and lifecycle cost goals are not all achievable. In certain segments of the military avionics market, the nature of
competition is changing from performance to affordability based. Firms that develop competitive advantage in delivering affordable systems can capture market share. This research is different than most literature published on affordability because it focuses on design innovation as opposed to product development and
manufacturing efficiency through Lean, Six-Sigma or other techniques. Lean and Six-Sigma are necessary to improve system affordability but not sufficient to develop competitive advantage because they can be implemented by anyone on any system concept. Competitive advantage requires benefits from Lean and Six-Sigma and design innovations focused on affordability. Step function type improvements can be realized through system architecture and module design innovations that strike a better balance between life cycle cost and performance.