David N. Ford

• Texas A&M University

Technology transition from research to “programs of record” (also known as “crossing the valley of death”) has often been challenging, especially when new capabilities emerge that weren’t originally envisioned, such as next generation aircraft, fighting vehicles, and so forth. The current research proposes and applies a framework for planning succe...

This is the first comprehensive book on Military Cost-Benefit Analysis and provides novel approaches to structuring cost-benefit and affordability analysis amidst an uncertain defense environment and cloudy fiscal prospects. Lifting the veil on military Cost-Benefit Analysis, this volume offers several new practical tools designed to guide defense...

A Real Options Valuation Model is developed to recom¬mend how to valuate technology when benefits cannot be measured in monetary value. Expected values of effectiveness are used to select the preferred alterna¬tive. The methodology is illustrated using three guidance system technologies in the Army’s Javelin program. The strategy created multiple r...

There have been a series of initiatives designed to reduce the cost of ship maintenance. SHIPMAIN, and its derivatives, was one of the initiatives designed to improve ship maintenance performance within the Navy by standardizing processes in order to take advantage of learning-curve cost savings. However, these process improvement initiatives have...

Due to the increasing demand for energy in the United States, the Nuclear Regulatory Commission is currently reviewing permit applications for 26 new nuclear power reactors. However, the previous generation of U.S. civilian nuclear plant construction ex-perienced significant cost and schedule overruns. Previous research identified "regulatory ratch...

The impacts on energy generation and use on sustainability, increasing energy demand, and declining natural resources have made energy improvements a top priority for many organizations. But adequate financing for sustainability improvement projects for built infrastructures is not available. The Paid-From-Savings approach can leverage savings to p...

Developed from financial options theory and pricing models, real options have evolved to become a mainstream area of academic inquiry. This account traces the field generally from its origins to present day. Research has demonstrated the potential for real options to enhance project value by managing uncertainty through investment, structuring and...

Effective and efficient planning for and management of project risk requires the management of uncertainty. Real options can be an effective tool for managing uncertainty and thereby increasing project value. As most managers do not use real options, but instead intuitively manage uncertainty, understanding the similarities and differences between...

Increased societal risks due to the anthropogenic degradation of natural systems often require public policy action to mitigate. For example, increased skin cancer risks associated with anthropogenic stratospheric ozone depletion led to public policies limiting the emission of many ozone-depleting substances. Natural–societal system interaction is...

Simulations that are used for both research and teaching in Construction Engineering and Management have several common features that provide the foundation for both the synergies between these uses and challenges in their integration. This work uses experiences with 8-10 such integrations as the basis for observations on the practice, a critical a...

Models of dynamic systems are often constructed to improve system performance by identifying and modifying structures and parameters that drive system behavior. Once identified, these can be used to design and test policies for performance improvement. A preliminary step in developing policies is the identification of high leverage parameters and s...

Effective and efficient DoD acquisition programs require the analysis of a wide range of materiel alternatives. Diversity among alternatives, difficulties in selecting metrics and measuring performance, and other factors make the Analysis of Alternatives (AoA) difficult. The benefits of alternatives should be included in the AoA, but cost estimates...

Due to increasing U.S. energy demand, the Nuclear Regulatory Commission is currently reviewing permit applications for 25 new nuclear power reactors. However, the previous generation of nuclear plant construction was beset by significant cost and schedule overruns. Several researchers have identified "regulatory ratcheting," increases in retroactiv...

Effective and efficient DoD acquisition programs require the analysis of a wide range of materiel alternatives. Alternative diversity, difficulties in selecting metrics and measuring performance, and other factors make the Analysis of Alternatives (AoA) difficult. The benefits of alternatives should be included in AoA, but cost estimates predominat...

Many interventions that are effective in one setting may be ineffective or even harmful in other settings. This poses a problem for organizations and communities planning the implementation of new programs, policies, and practices. This paper introduces the use of system dynamics computer simulation of real options to design implementation strategi...

Incremental development entails the deliberate deferral of work to a subsequent period, using technology maturity as the measure of readiness. This article illustrates that this approach might enable more effective delivery of the first increment with a comparison of two major systems as case studies. But there are some inherent risks in an evoluti...

Community responses to domestic violence typically involve the introduction of multiple interventions. Yet very little is known about the impact of the timing and sequencing of these interventions on community outcomes. A reason for this is the inherent limitations of traditional methods in social science. New methods are needed to understand the e...

Domestic violence is a major social problem. In the United States, the failure of communities and police departments to intervene resulted in a push to implement pro- and mandatory arrest policies for domestic violence. These policies have led to an unexpected increase in the number of victim arrests. Competing explanations have been offered. This...

The Defense Acquisition Review Journal, formerly the Acquisition Review Quarterly journal, is published quarterly by the Defense Acquisition University (DAU) Press. Articles in this issue include: Calling All Program Managers Assuming the Role of CEO; The Future Use of Corporate Warriors with the U.S. Armed Forces: Legal, Policy, and Practical Cons...

Evolutionary acquisition mandates incremental development for all programs. This policy seeks to improve development project performance, but may increase some risks. Computational modeling using systems dynamics reveals that evolutionary acquisition can increase concurrency and the need for coordination. The result is earlier delivery of the first...

Providing system interoperability and evolving technologies in major DoD systems are two important acquisition challenges in preparing the military to meet current and future demands. The Acoustic Rapid COTS Insertion (ARCI) program successfully addressed many of the associated challenges. That program was studied as the basis for modeling the plan...

Designing a resource strategy for logistics support includes choosing to use contracted, blended, or organic support, or a combination thereof, for acquisition products. Non-cost issues have received much less attention than cost in resource strategy design-even though policy requires the incorporation of many non-cost issues. This lack of attentio...

Utility accommodation policies nationwide contain requirements for the accommodation, location, installation, relocation, and maintenance of utility facilities on the state right-of-way. The policies normally cover basic requirements, making it necessary to use additional specifications and special provisions to handle situations not covered by the...

Minimizing duration is critical to success in many development projects. Resource allocation policies during such projects determine the fractions of resources that are to be assigned to constituent tasks. The choice of allocation policy can strongly influence project durations. But policies for reduced project duration are difficult to design and...

The critical role of water infrastructure systems in sustainable development and the limitations of supply management have increased the importance of demand management in meeting water needs. As an integral part of demand management in water-stressed regions, water allocation policies address the competition among user groups for scarce water reso...

Complex construction projects are vulnerable to tipping points. Tipping points are conditions that, when crossed, cause system behaviors to radically change performance. Previous research identified tipping point dynamics as capable of explaining the failure of some nuclear power plant construction projects. These dynamics can also threaten the suc...

Open systems and evolutionary acquisition are two recent innovations designed to improve program performance with flexibility. The full potential of these approaches has not been captured, partially because of integration challenges during implementation. The current work investigates the impacts of open systems and evolutionary acquisition on DoD...

The DoD's evolutionary acquisition policy is directed against project risk, but bears inherent risks of its own. The DoD policy for evolutionary acquisition mandates multiple product releases via spiral (i.e., amorphous & unplanned) or incremental (i.e., defined & deferred) development methodologies for all programs. All amorphous spirals eventuall...

The DoD's evolutionary acquisition policy is directed against project risk, but bears inherent risks of its own. The DoD policy for evolutionary acquisition mandates multiple product releases via spiral (i.e., amorphous and unplanned) or incremental (i.e., defined & deferred) development methodologies for all programs. All amorphous spirals eventua...

One of the most successful areas for the application of system dynamics has been project management. Measured in terms of new system dynamics theory, new and improved model structures, number of applications, number of practitioners, value of consulting revenues, and value to clients, “project dynamics” stands as an example of success in the field....

System dynamics has been successfully applied to the study of projects for many years. While this modeling has clearly defined the structures which create project dynamics, it has been less helpful in providing explicit policy advice to managers to control project performance. To address this gap we examine the impact of three common project contro...

Domestic violence is a major social problem worldwide. In the United States, the failure of communities and police departments to intervene resulted in a push to adopt and implement pro and mandatory arrest policies for domestic violence. These policies have led to an unexpected increase in the number of arrests of women. Competing explanations hav...

System dynamics models are often constructed to improve system performance by identifying and modifying feedback mechanisms that drive system behavior. Once identified, these feedback mechanisms can be used to design and test policies for system performance improvement. A preliminary step in developing policies is the identification of high leverag...

Purpose – Construction strategies for competitive bidding and operations are used to avoid the consequences of poor schedule performance such as delay penalties. Flexible strategies in the form of options can increase project value if uncertain conditions cannot be adequately forecast before operations begin. However, project management purposefull...

Previous system dynamics work models the tipping of a series of product development projects into fire-fighting mode in which rework overwhelms progress. Similar dynamics also threaten the performance of individual development projects. The current work extends previous tipping point dynamics research to single projects and demonstrates how a simpl...

Tipping point feedback structures can push a series of product development projects into fire-fighting mode in which rework overwhelms progress. Similar dynamics also threaten the performance of individual development projects. The current work extends previous tipping point dynamics research to single projects and demonstrates how a simple, common...

The current work examines the application of system dynamics to real options through work with a major energy firm to apply real options. Five key challenges facing the real options community are presented and potential system dynamics contributions to these challenges are discussed. Two cases from a BP research project illustrate how system dynami...

Project management is about making decisions under uncertainty, throughout the various phases of a project. Different perspectives on risk can be held by project management, and these perspectives can appear inconsistent and even in conflict. Portfolio theory justifies ignorance of unsystematic risks, for example uncertainties related to the occurr...

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Civil and Environmental Engineering, 1995. Includes bibliographical references (leaves 269-277).

Uncertainty in product development projects creates significant challenges for managers who are under intense competitive pressures to increase product quality, while reducing development time and costs. Traditional wisdom dictates the early selection of a single design in order to freeze interfaces between product subsystems so that team members c...

Effective and efficient development of large complex acquisition projects requires proactive management of uncertainties to meet performance, schedule, and cost targets. Flexibility in the form of real options can be an effective tool for managing uncertainty and, thereby, adding value to acquisition projects. But, real options can be both difficul...

In this paper we discuss Renn and Klinke's approach for risk evaluation and selection of risk management strategies. The main focus in the discussion is the foundational basis and the understanding of what risk is, and how a different foundational basis may simplify and improve the characterization of risk. We will present and discuss an alternativ...

This paper is a case study of selected practices of the 1999 Texas A&M Bonfire, a student-run project, as compared to ethical practices of professional constructors. This paper identifies seven ethical practices of professional constructors which were not followed during the construction of the 1999 Texas A&M Bonfire. The seven ethical practices no...

Shortening project duration is critical to product development project success in many industries. As a primary driver of progress and an effective management tool, resource allocation among development activities can strongly influence project duration. Effective allocation is difficult due to the inherent closed loop flow of development work and...

Previous system dynamics work models the tipping of a series of product development projects into fire-fighting mode in which rework overwhelms progress. Similar dynamics also threaten the performance of individual development projects. The current work extends previous tipping point dynamics research to single projects and demonstrates how a simpl...

In evaluating capital budgeting decisions, quantitative approaches, such as traditional discounted cash flow modeling and real options valuations, are useful when there is a presumed probability distribution for the future forecasted outcomes or for when there are lower levels of uncertainty. As uncertainty increases and forecasting becomes difficu...

Complete and accurate design is critical for construction project success. Manifesting design intent in the constructed facility depends on coordinated design documents that are developed through design realization. This process evolves design intent from architects and engineers to contractors, through the production and review of shop drawings an...

Highway project durations that are longer than necessary delay the delivery of benefits to road users. Budget constraints often preclude the use of additional funds to shorten total project duration. Therefore, state highway agencies seek ways to decrease construction project durations without increasing costs. Research has recommended formal const...

Successfully implementing concurrent development has proven difficult for many organizations. However, many theories addressing concurrent development treat either technical aspects of the development process (e.g., precedence relationships) or behavioral issues (e.g., creating effective cross-functional teams), but not their linkages. We argue tha...

Successfully implementing concurrent development to reduce cycle time has proven difficult due to unanticipated iterations. We develop a dynamic project model that explicitly models these interactions to investigate the causes of the "90% syndrome," a common form of schedule failure in concurrent development. We find that increasing concurrence and...

High uncertainty in the performance of product design alternatives has forced developers to consider multiple alternative designs in parallel. Traditional wisdom dictates the selection of the final alternative as quickly as possible. But delaying decisions on alternatives as designs develop has provided sustainable competitive advantage for Toyota,...

Project managers use budgets to satisfy multiple objectives such as cost control, short durations, and high quality. Contin-gency funds are included in project budgets to manage risk and achieve project goals. Understanding how managers use budget contin-gencies requires a dynamic information processing model of how managers bridge the gap between...

To maximize project value, managers of construction projects must recognize, plan for and strategically manage uncertainty. Current construction planning, estimating, and management practices regarding uncertainty can undervalue projects by failing to exploit opportunities to increase project value, as well as minimize risks. Dynamic uncertainties...

Successfully managing dynamic complex systems requires an understanding of how structure influences both short-and long-term behavior. Therefore, decision support systems designed to improve performance by increasing user understanding require features that address both short and long time scales. The authors report the results of empirical researc...

The ability of organizations to learn is critical for success. Implementing organizational learning in engineering cultures can be difficult due to a focus on technology instead of people and imbalances among cultures within an organization. A project to transform a medium-sized engineering organization into a learning organization is reported, and...

This article revisits a conceptual definition of “mental models of dynamic systems” proposed for use in system dynamics research by Doyle and Ford and commented on by Lane. Lane's proposed amendments to the definition are discussed in turn, with particular attention to the history and appropriate use of the term “cognitive map.” A revised definitio...

Feedback loop dominance is a critical tool in explaining how structure drives behavior. Current analytic tools for loop dominance analysis are tacit, not codified, unable to accurately identify dominant loops or inapplicable to most models. Most loop dominance analysis tools focus on model structure to link structure and behavior. We use a behavior...

Although “mental models” are of central importance to system dynamics research and practice, the field has yet to develop an unambiguous and agreed upon definition of them. To begin to address this problem, existing definitions and descriptions of mental models in system dynamics and several literatures related to cognitive science were reviewed an...

Following their formal education managers face processes and organizations which are too varied, complex and dynamic to be designed and managed solely with solutions provided in school. To be successful managers must learn independently and apply new knowledge throughout their careers. How can managers learn how to learn about complex systems witho...

System dynamics contends that understanding the causal structure of systems is required to successfully manage their behavior. However the best means of improving causal understanding is not well understood. Management Flight Simulators (MFS) have been used to study the effect of simulated environments on learning and management performance. These...

Successful development projects are critical to success in many industries. To improve project performance managers must understand the dynamic concurrence relationships that constrain the sequencing of tasks as well as the effects of and interactions with resources (such as labor), project scope and targets (such as delivery dates). This article d...

Knowledge intensive processes are often driven and constrained by the mental models of experts acting as direct participants or managers. Descriptions of these relationships are not generally available from traditional data sources but are stored in the mental models of experts. Often the knowledge is not explicit but tacit, so it is difficult to d...

Cover title.

Effective and efficient development of large complex acquisition projects requires proactive management of uncertainties to meet performance, schedule, and cost targets. Flexibility in the form of real options can be an effective tool for managing uncertainty and thereby adding value to acquisition projects. But real options can be both difficult t...

The critical role of water for sustainable development and limitations of supply management have increased the importance of demand management in meeting water needs. As an integral part of demand management in water-stressed regions water allocation policies address the competition between different user groups for scarce water resources. This pap...

Many interventions that are effective in one setting may be ineffective or even harmful in other settings. This poses a problem for organizations and communities engaged in planning efforts seeking to improve outcomes. This paper introduces the use of managerial real options combined with system dynamics models to design strategies for implementing...