441 Javier Pastor Sánchez Life Cycle Cost Estimation Procedure for a Weapon... Up until 2011, only the acquisition costs of systems was accounted for in Spain, without taking into consideration the fact that this cost varied between 20% and 30% of the total LCC. http://revista.ieee.es/index.php/ieee COST ESTIMATE Cost estimates are predictive processes that aim to lessen the uncertainties involved in the development of a project by means of techniques and tools that should be utilised in the planning phase. The term ‘cost estimates’ is often used to describe the process by which the present and future impact of engineering design is forecast.20 Project cost estimating procedures are regulated by international standards such as those of PMI, which are produced by experts in the field. The current state of LCC estimation for a weapon system is mainly determined by the defence economy, in particular, by international organisations within the sector such as NATO. The latter, for instance, undertook a revision of the cost estimating methods and models for NATO countries and allies in 2007 as part of the RTO-TR-SAS- 054 group, facilitating a general overview of the application and use of LCC right from the early conceptual phase through to removal from service. In addition, this addresses how to deal with uncertainty and risk when developing LCC estimates. Report SAS-054 concludes with a series of recommendations to improve the use and understanding of LCC within the formation of the decision-making process. It concludes by formulating best procurement practice for the different phases of a weapons programme and ends with conclusions and recommendations. Furthermore, various NATO publications, clearly originating in the US, a country with the most influence over the definition of the theoretical and conceptual framework, form the theoretical framework for LCC estimation in Europe. More specifically, the most relevant include the publication ALCCP-1, which provides a common understanding of LCC as well as a common method for conducting LCC analysis for NATO countries, agencies and other entities. This publication is a continuation of the efforts taken by NATO panels such as RTO TR-058,SAS-028, structures for cost and life cycle costs for military systems, and develops a general structure for life cycle costs. Moreover, NATO recently edited the results of the group SAS-076 in 2012. This group publishes estimates for independent costs within NATO and the role of LCC as part of defence activity management. 20 DEGARMO. DeGarmo Engineering Economy. Pearson Prentice Hall. Mexico. 2004. Pg 24. ISBN 970-26-0529-6.
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