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  • Question

    What information is required in the EA to support the FDDR? DoD 5000 contains no guidance and the DAG has instructions for the EA, but no guidance is provided for updating the document for FDDR.


    Answer

    The Full Deployment Decision Review (the Full-Rate Production Decision for MAIS programs or software intensive systems with no production components), requires an Economic Analysis (or update if previously performed).
    The purpose of the Economic Analysis is to determine the best AIS program acquisition alternative, by assessing the net costs and benefits of the proposed AIS program relative to the status quo. In general, the best alternative will be the one that meets validated capability needs at the lowest life-cycle cost (measured in net present value terms), and/or provides the most favorable return on investment.

    Whenever an Economic Analysis is required, the DoD Component responsible for the program also may be required to provide a DoD Component Cost Analysis, which is an independent estimate of program life-cycle costs. Normally, the Economic Analysis is prepared by the AIS program office, and the DoD Component Cost Analysis is prepared by an office or entity not associated with the program office or its immediate chain of command. The Economic Analysis should be accomplished in accordance with DoD Instruction 7041.3, "Economic Analysis for Decisionmaking.", specifically enclosure 3 which specifies the procedures for accomplishing Economic Analysis. 

    Normally, the DoD Component submits a Final Cost/Benefit Position that resolves the differences between the Economic Analysis and the Component Cost Analysis. Also, the Affordability Assessment should address any differences between the Final Cost/Benefit Position and the funding in the current Future Years Defense Program.

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