**4. MS&A approach for acquisition strategy development and optimization supporting pre-award phase**

The proposed MS&A approach for the acquisition strategy development was derived from [15, 16], where an acquisition strategy is developed based on the selected SOSE architecture solutions and associated technical and program risks and cost and schedule risks. Based on the technology (TRL) and market (MRL) uncertainty risk assessment results associated with the selected SOSE architecture solutions, the proposed MS&A approach uses advanced acquisition strategy mapping framework, as shown in **Figure 6**, to select an appropriate contract type with associated optimum architecture solution. Depending on the TRL and MRL assessment results, an optimum contract type is chosen and appropriate game theoretical type is selected to optimize the contract parameters, including target price, sharing ratios (SR) and contract fees allowing maximum USG savings with "increased competition" or "increased number of bidders." Currently, References [15–17] only addressed the three contract types, including Firm Fixed Price (FFP), Fixed Price Incentive Firm (FPIF) and Cost Plus Incentive Firm (CPIF). **Figure 6** also describes requirements classifications, risk assessment classification, acquisition strategy mapping, and architecture solution classification and risk assessment for architecture risk assessment.

**Figure 11** describes a recent advanced MS&A approach for supporting acquisition strategy development and optimization along with an example of an acquisition solution output [15, 16]. As shown in **Figure 11**, the approach requires input from warfighter and associated stakeholders, a set of optimum alternative system architectural solutions obtained from SOSE CONOPS assessment, and a predefined PCF11 to evaluate USG saving and contractor profit along with the contract's parameters. Additionally, the required inputs to the proposed MS&A models and tools include USG architecture solution type, risk assessment results, cost distribution, corresponding contract type. The outputs include (i) Optimum acquisition strategy12 and contract type and associated contract parameters, including

<sup>11</sup> PCF for USG is used to evaluate the USG saving/loss and associated payoffs; and for contractor bidding game, PCF is used to evaluate the contractor's profit/loss and associated payoffs.

<sup>12</sup> Optimum bidder strategy is based on Nash strategy. For non-optimum bidder strategy, contractors select their bid based on a fixed (or randomly assigned) percentage of cost and contract's parameters are optimized for maximum profit and minimum execution risk using assigned PCF.

### *Systems-of-Systems MS&A for Complex Systems, Gaming and Decision for Space Systems DOI: http://dx.doi.org/10.5772/intechopen.100007*

incentives, target price, SRs and fees, (ii) USG saving (payoff), (iii) contractor profit (payoff), (iv) Number of potential bidders (i.e., increase competition), and (v) Risk results in terms of technology (technical and performance) and program (cost and schedule) risks. The acquisition strategy depends on the program and technical risks assessment of the selected optimum architecture solution obtained from the SOSE-CONOPS-assessment model in Section 3.1.1 and system-architecture-assessment model in Section 3.1.2, hence these two MS&A models will be tightly coupled with the acquisition strategy development and optimization MS&A models discussed in this section.
