Frontier Technology, Inc. “Crafting Quality IT and Engineering Solutions”

1. Frontier Technology, Inc. “Crafting Quality IT and Engineering Solutions” Decision Support Tools To Enable Affordability For Responsive Space Acquisition Services Joe Wotton Principal Program Manager Co-Author Sam Boykin Senior Scientist 4141 Col Glenn Highway Beavercreek, OH 45431 (937) 429-3302 WWW.FTI-NET.COM

2. Components of a Distributed Collaborative Environment

3. FTI Maximizes Value to Our Customers • DOMAINS • Space Systems • Air-Space Integration • C2 / ISR Systems • Signal Exploitation • Operations Research • BUSINESS AREAS • Affordability & Acquisition Tools/Services • Modeling & Simulation • Engineering & Analysis • Sensors & Pattern Recognition • TOOLS • IDAPS Enterprise Edition • ICE™ • ICAIV™ / RTOC™ • AOC • SOPSMAN™ • IT SERVICES • Software Environ. Analysis • Network Design, Ops & Management • Software Development

5. Attachment 1 to Deputy Secretary of Defense Memorandum, Acquisition Policy, October 30, 2002, entitled The Defense Acquisition System

6. Effectiveness Cost What Does This Mean For Cost? Effectiveness and cost are weighted equally in acquisition decisions

7. Relative Accuracy of Cost Estimates Uncertainty With Current Tools & Techniques Estimated Cost/Performance Uncertainty With Improved Collaborative Tool Set Actual Cost/Performance of a New Technology Technology Cost/Performance Actual Costs/Performance No System Design Very Good Estimating Tools Make up Majority of Estimate To Base Estimate (Based on Some System Design) DESIGN REVIEWS POST CDR TECHNOLOGY EVALUATION

8. RTOC Assessments Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations Overall Program StrategyFunding Justification Aspects Funding Justification POM, WRAP, COSSI, PRAM, etc. CAIV

9. Acq Costs R&D Costs LCC Total Return/ Savings/ROI Prod Costs O&S Costs O&S Savings Overall Program StrategyThe “How” Funding Justification RTOC Assessments POM, WRAP, COSSI, PRAM, etc. CAIV Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations

10. AFTOC / DLR Etc. Etc. SAGE JOSTE User Defined.. PRICE-S CASA SEER-H O&S COCOMO SEER O&S CORE SEER-SEM LCOM CORE R&D Production O&S O&S Savings Other Models Linkable from Excel (Excel, Access, etc.) ACE-IT, Etc. Parts Obsolescence data and tools ACE-IT, Etc. Various integrated models / databases User Defined. Etc. Etc. User Defined. SAGE User Defined. NAFCOM PRICE-S NAFCOM PRICE-H COCOMO PRICE-H SEER-H SEER-SEM SEER-H Overall Program StrategyThe “How” Funding Justification RTOC Assessments POM, WRAP, COSSI, PRAM, etc. CAIV Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations

11. Overall Program StrategyThe “How” Funding Justification RTOC Assessments POM, WRAP, COSSI, PRAM, etc. CAIV Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations SEER PRICE ICE ACEIT

12. SYSTEM ALTERNATIVES ALTERNATIVES MOEs Capabilities Capabilities vs. Capabilities MOEs vs. Alternatives Capabilities vs. MOEs PRIORITIZED MOEs PRIORITIZED Capabilities Capabilities Phase 1 Phase 3 Phase 2 PRIORITIZED Capabilities ALTERNATIVE UTILITY “SCORE” PRIORITIZED MOEs Overall Program StrategyThe “How” Funding Justification RTOC Assessments POM, WRAP, COSSI, PRAM, etc. CAIV Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations

13. Overall Program StrategyThe “How” Funding Justification RTOC Assessments POM, WRAP, COSSI, PRAM, etc. CAIV Performance Assessments Affordability Assessments Risk Assessments • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Engineering Buildup • Analogy • Feature/Process Based • Parametric • Internal Models • Crystal Ball • @Risk • Estimations • Detailed Design • Simulations • Demonstrations Crystal Ball @Risk Risk+ TRL Etc.

14. CAIV Vision for Decision Support ARCHITECTURE SYSTEM ALTERNATIVES ALTERNATIVES Schedule Insight Architecture MOEs vs. ARCHITECTURE PRIORITIZED PRIORITIZED ALTERNATIVE MOEs MOEs CAIV MOEs vs. Alternatives Alternatives ARCHITECTURE ALTERNATIVE UTILITY “SCORE” UTILITY “SCORE” System Alternative Risk Assessment Results LCC and Cost Savings Analysis Results

15. CAIV Process Template (Prioritization & Affordability Example) ID Missions Prioritize Missions Define Requirements Prioritize Requirements Select MOE’s Utility Curve for each MOE’s Prioritize MOE’s Select Trade Alternatives Estimate Alternative $ Score Alternatives Determine Alternative ROI Determine Baseline $ Perform Risk Assessment Utility Cost Risk

16. ALTERNATIVES MOEs Requirements vs. MOEs PRIORITIZED REQUIREMENTS PRIORITIZED MOEs What is I-CAIV? Analysis of Alternatives RISK COST SYSTEM ALTERNATIVES REQUIREMENTS Reqmts vs. Requirements MOEs vs. Alternatives PRIORITIZED MOEs REQUIREMENTS Phase 1 Phase 2 Phase 3 PRIORITIZED REQUIREMENTS ALTERNATIVE UTILITY “SCORE” AHP QFD QFD 3-D affordability trade space • Methodology and tool enables user to: • Prioritize requirements • Evaluate requirements compared to MOEs Prioritized MOEs • Evaluate MOEs compared to alternatives Utility score • Combine with cost or with cost and risk for effective evaluation of affordability

17. I-CAIV Output is Dynamic CRAIV 3-D Decision Space for Assessments • Cost and Risk as Independent Variables (CRAIV) • 3-D Decision Space Allows User to View All Key Aspects • PC-Based Tool Allows Dynamic “What-Ifs” Within Decision Space • Full Range of Analysis and Prioritization Data Is Archived in Tool • Bring Traceability into the Decision Making Process MG-99-XXXXFCR1.ppt

18. I-CAIV provides “dynamic” 3-D trade space for real-time sensitivity analyses throughout development process ARCHITECTURE SYSTEM ALTERNATIVES ALTERNATIVES Architecture MOEs vs. ARCHITECTURE PRIORITIZED PRIORITIZED ALTERNATIVE MOEs MOEs MOEs vs. Alternatives Alternatives ARCHITECTURE ALTERNATIVE UTILITY “SCORE” UTILITY “SCORE” System Alternative Risk Assessment Results Alternative Cost / R-TOC Analysis Results

20. Percent Costs Locked In by Early Decisions Percent Costs Actually Expended Cost Reduction Opportunities Early Decisions Impact LCC Cumulative Percent of LCC Each mod to a program has a similar curve Program Milestones Do we spend our time in the area we have the least cost impact? If so, is it because it is easier there?

21. Various Costing Techniques MS A MS C MS B Extrapolation (Catalog) Analogy (Comparison) Expert Opinion Engineering (Bottom-up, Actuals) Parametrics (Cost Function) Range Estimates Point Estimates

22. Operations Savings via removal of current systems Operate Acquisition Cost ROI Support Many years Develop Production Dispose Few years “How Much Does It Cost ?”Much More Complex Answer Today

23. AFI 65-503 Integrated Cost Estimation (ICE)A collaboration of cost tools, models and data • Automated cost estimation based on multiple,accepted cost models • Provides EMD, production costs, and O&S costs in CAIG format Other… User Defined Parts Obsol Other… • ICE Environment • Integrated models • Integrated databases • Links to other models / data • Graphical User Interface • “Wizard” to guide user Other . . Other… Excel Import User Defined Parts Obsol User Defined Excel Import OSD Facility User Defined Excel Import Parts Obsol SEER DFM Excel Import Parts Obsol OSD Facility SAGE OSD Facility OSD Facility PRICE H/S CORE SEER O&S AFTOC SEER-SEM /H Relating to Future Systems Relating to Currently Fielded Systems Relating to Currently Fielded Systems For Mods, Enhancements or New Systems Future O&S Costs Future Prod Costs Future R&D Costs Projected O&S Savings Acquisition Costs Life Cycle Cost Total Return & Savings ROIs BCAs = Link in Proprietary Models, Models not previously integrated in and ACE-IT outputs In Work Excel Import

24. ICE Life Cycle Cost Estimates • ICE is not a cost estimating model • ICE is an system for estimating total system costs • ICE enables: • Technologist to identify high cost systems in their technology niche that may be an opportunity for investment • Quick credible LCC (EMD, Production and O&S) and savings estimates • Sensitivity analysis on technical issues that are key cost drivers • Easily viewable affordability trades to support program justification and “what-if” exercises • ROI comparisons against other non-related technology investments.

25. FTI Teaches ICETM and Affordability at Defense Acquisition University Industry and government partner on cutting-edge, cost-conscious defense education and training programs SANTA BARBARA, CA - March 19, 2001 - In a recent ceremony at the Pentagon office of Dr. Spiros Pallas, Principal Deputy to the Director, Strategic and Tactical Systems, FTI and the Defense Acquisition University (DAU) signed a letter of intent calling for FTI to provide training to the U.S. Department of Defense workforce in the area of systems acquisition. DAU is the corporate university for acquisition training in the Department of Defense. FTI has developed and will teach an elective for the Advanced Program Management Course (APMC) on cost estimating for the Defense Systems Management College, one of the in-residence instructional institutions for Defense Acquisition University. In fiscal year 2000, the DAU trained 40,723 students from the Air Force, Army, and Navy.  The course is based on FTI’s development of a flexible system of integrated cost-analysis software models and data called ICE™, which enables users to estimate life-cycle cost and return on investment. "This new elective course introduces automated tools to replace the more time-consuming process of estimating costs by hand," explained Lavon Jordan, CEO for FTI. "Much of the credit for this training program belongs to Brigadier General Frank Anderson (retired), for his vision in recognizing the need to reduce operating costs and reliably assess system life-cycle costs and affordability before committing funds," Jordan added. Anderson is president of Defense Acquisition University, based in Fort Belvoir, Virginia. Signing of DAU and FTI Letter of Intent on February 16, 2001.  Seated from far right: Lavon Jordan, CEO, Frontier Technology, Inc.; Frank Anderson, Jr., DAU President; Spiros G. Pallas, Principal Deputy to the Director, Strategic and Tactical Systems, OUSD (AT&L).  Standing from left:  Scoop Cooper, Frontier Technology; Paul McMahon, Director of Strategic Partnerships, DAU; Ron Shroder, Vice-President, Frontier Technology.

26. AFMC Is Providing Infrastructure • Site license PRICE 2002 Enterprise enabled estimating Suite (H/S/M/HL), expires 31 Jan 03 • Site license SEER-SEM (software) and SEER-H, expires 26 Sep 03 • Site license IDAPS Cost Estimation (ICE) Tool, expires 19 Sep 03 • Site license ACEIT, support and maintenance, expires 30 Sep 03 AFMC has not contracted for training. Training for any of these tools must be organizationally funded.

27. FTI Supports Air Force Institute of Technology (AFIT) on LCC and Affordability • Industry and government partner on defense education • SANTA BARBARA, CA – Dec 20, 2002 – An agreement was reached this month between FTI and AFIT for FTI to assist in training AFIT students in Life Cycle Cost estimating and Affordability Assessments. • FTI’s supports AFIT via teaching subsections of 2 AFIT courses which are critical to members of the acquisition community. The courses are: • Introduction to Life Cycle Costing (QMT 353) which acquaints students from various functional fields (procurement, cost analysis, engineering, logistics, program management) with the fundamental concept of Life Cycle Cost (LCC) as it applies to the acquisition of systems and sub-systems. FTI’s provides insight via their knowledge from building ICE. Their insight provides links to some of the communities best sources of information to support the acquisition official. • Introduction to Affordability in Air Force Science and Technology (QMT 251) which is intended for all scientists and engineers (S&Es), acquisition professionals, and others interested in affordability in S&T.FTI’s knowledge from building I-CAIV provides insight as to the best practices of balancing performance, cost, schedule and risk in an affordability CAIV decision space to build program advocacy.

28. ICE Community Involvement and Acceptance USAF USN AFRL Users • Pax River • Aircraft • Information • Sensors • Human Effect • Power Systems • Propulsion • Manufacturing • Materials MDA / Army • MDA / SMDC AFMC Wide License And others as appropriate Logistics Ctr Users • OC-ALC • WR-ALC Gov FM communities for Model Selection Industry Users Product Ctr Users Lockheed Martin ITT GE PW Rolls BAE GD • Aging Aircraft • Engines SPO • FM Staff • Devel Planning • Special Op Forces • Subsystem SPO Providing O&S data ICE Users Group

29. Summary • Our commercially available products, known as ICE and I-CAIV, enable affordability to be a key part of the Responsive Space decision process including the creation of the RTOC Standard Business Cases • ICE is an integrated environment of the communities’ cost estimating tools that can make it easier to influence decisions by providing immediate insight into ROI • It leverages the significant investments in cost estimating tools and data sources • ICE can supplement the basic capability with other community databases where appropriate • ICE and I-CAIV enables program managers, engineers and scientist to have quick insight into cost estimating and Return on Investment to prioritize the alternatives • These Services can be used by Responsive Space leaders to • Perform cost estimating and create the business cases (Affordability Assessments) • Combine the affordability assessments with performance analysis via Systems Engineering and perform CAIV analysis (Acq Assessments) • Assist in working the business cases through the funding process (Acq Assessments)