Economic Analysis of Model-Based Systems Engineering

In the face of ever-increasing complexity of systems and system development programs, several aerospace, automotive, and defense organizations have already begun or are contemplating the transition to model-based systems engineering (MBSE). The key challenges that organizations face in making this decision are determining whether it is technically feasible and financially beneficial in the long-run to transition to MBSE, and whether such transition is achievable given budgetary constraints. Among other cost drivers of this transition, are a new digital infrastructure, personnel training in MBSE, and cost-effective migration of legacy models and data into the new infrastructure. The ability to quantify gains from MBSE investment is critical to making the decision to commit to MBSE implementation. This paper proposes a methodological framework for analyzing investments and potential gains associated with MBSE implementation on large-scale system programs. To this end, the MBSE implementation problem is characterized in terms of: system complexity, environment complexity and regulatory constraints, and system lifespan. These criteria are applied to systems in twelve major industry sectors to determine MBSE investment and expected gains. Results from this cost-benefit analysis are used to justify investment in MBSE implementation where warranted. This approach is generic and can be applied to different sectors for economic evaluation of costs and benefits and justification of transition to MBSE if warranted.