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Management Concepts

Developing the Independent Government Cost Estimate

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Next dates

May 28—30
3 days
Washington, District of Columbia, United States
USD 859
USD 286 per day
Jul 31—Aug 2
3 days
Washington, District of Columbia, United States
USD 859
USD 286 per day
Nov 4—6
3 days
Washington, District of Columbia, United States
USD 859
USD 286 per day

Description

There are many approaches to achieve best value acquisitions. One of these approaches is the independent government cost estimate (IGCE), a powerful tool to support determination of cost reasonableness and realism. You will learn to develop the IGCE through step-by-step procedures—breaking the requirement into cost elements, establishing resources and restrictions, and making assumptions. You will practice collecting and projecting cost data to develop a reliable and useful cost estimate.

Note: This training course does not cover construction cost estimating.

Learning Objectives

  • Explain the purpose of the Independent Government Cost Estimate (IGCE)
  • Describe the major elements of the cost estimate
  • Discuss the steps in the cost estimating process
  • Select appropriate estimating methods
  • Develop an IGCE

Course Topics

Independent Government Cost Estimate

  • The Importance of Cost Estimating
  • Some Factors Affecting Cost Estimates
  • Regulatory Requirements that Affect Independent Government Cost Estimates

The Importance of the Requirements Document

  • Purpose of the Requirements Document
  • How the Requirements Document Affects the Estimating Process
  • Relationship of Contract Type to Estimating
  • What is Being Purchased and Its Impact on Estimating
  • Exercise: Requirements Document

Looking at Cost as an Element of the Estimate

  • Price-Volume Analysis
  • Using the Linear Price-Volume Relationship — Algebraic Analysis
  • Using the Linear Price-Volume Relationship — Graphic Analysis
  • Recurring and Nonrecurring
  • Allowable and Unallowable
  • Exercise: Describing the Requirements Document

Typical Elements of an Estimate

  • Adjustments to Material Quantities
  • Labor Costs
  • Other Direct Costs
  • Burden or Indirect Expenses
  • Facilities Capital Cost of Money
  • Profit/Fee
  • Three Major Steps in the Cost Estimating Process
  • Exercise: Looking at Costs

Using Requirements Document as Estimate Starting Point

  • Evaluate the Accuracy and Completeness of the Requirements Document
  • Choose the Appropriate Estimating Method
  • Breaking the Requirements Document into Its Constituent Cost Elements
  • Break Work into a Hierarchical Structure
  • Exercise: Preparing a Work Breakdown Structure
  • Exercise: Preparing a Detailed Estimate

Making the Estimate

  • Define the Scope of the Estimate
  • Establish Resources and Restrictions
  • Assess the Requirements Document
  • Make Assumptions
  • Collect Cost Data
  • Project the Cost Data
  • Document the Estimate
  • Summary
  • Exercise: Parametric Analysis
  • Exercise: Trend Analysis

Evaluating the Estimate

  • Reviewing Estimate
  • Assess the Scope of the Estimate
  • Evaluate the Estimate Method
  • Document the Review
  • Exercise: Preparing IGCE

Who should attend

This course is designed for technical personnel and others who are responsible for developing the IGCE.

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