Total Ownership Cost

Report Number: NPS-CE-11-014

Series: Acquisition Management

Category: Affordability

Report Series: Sponsored Report

Authors: Mike Boudreau, Brad Naegle

Title: Total Ownership Cost

Published: 2011-03-01

Sponsored By: Acquisition Research Program

Status: Published--Unlimited Distribution

Research Type: NPS Faculty

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Keywords: affordability, research and development cost, total ownership cost (TOC), reduction in total ownership cost (RTOC), life cycle cost, operating & support cost, sustainment cost, developmental cost, pro


Control of total ownership cost (TOC) is a continuing initiative to manage costs over the entire life cycle of a weapon system. There are several major categories of costs that contribute to Total Ownership Cost but the principal categories are (1) R&D, (2) Production, (3) Operating and Support, and (4) Disposal. System TOC is the same as Life Cycle Cost (LCC) and must be planned and controlled from requirements definition, system development, and sustainment