Developing a Cost Overrun Predictive Model for Complex Systems Development Projects

Abstract

While system complexity is on the rise across many product lines, the resources required to successfully design and implement complex systems remain constrained. Because financiers of complex systems development efforts actively monitor project implementation cost, project performance models are needed to help project managers predict their cost compliance and avoid cost overruns. This article describes recent research conducted by the authors to develop a cost overrun predictive model using five known drivers of complex systems development cost. The study identifies schedule and reliability, as the key determinants of whether or not a large complex systems development project will experience cost overrun.