How to convince decision-makers of MBSE

Model-Based Systems Engineering (MBSE) helps us to deal with complexity, so far so good. But many companies ask themselves whether the cost of implementation justifies the result. This depends on several factors, and that's what we're looking at today. In the following, I summarize the results of a study by Azad Madni and Shatad Purohit from the University of Southern California.

Is MBSE advantageous and feasible?

The complete paper Economic Analysis of Model-Based Systems Engineering is of interest to decision-makers who are strategically considering the introduction of MBSE have to decide. The return on investment (ROI) of MBSE is almost always realized over a longer period of time and is therefore usually of strategic importance. This in turn requires the identification of KPIs. The full paper provides valuable information on this. Management requires good KPIs that quantify the advantage of MBSE over traditional approaches and measure success. Management measures success with the three metrics Faster, Better, Cheaper.

The benefits are offset by the expected costs. The cost drivers of this changeover include a new digital infrastructure, staff training and the cost-effective migration of old models and data to the new infrastructure.

But is MBSE also technically feasible? We also have to convince the company management of this. After all, MBSE usually requires a major investment and it can take years for the return on investment to be realized.

The authors have characterized the MBSE implementation problem in terms of the following factors:

• System complexity
• Complexity of the system context
• Regulatory restrictions
• service life of the system.

These criteria are applied to systems in twelve major industries to determine MBSE investments and expected profits. The approach shown here is generic and allows for an economic evaluation in different sectors.

Cost distribution of systems engineering vs. MBSE

We have known for over 20 years that a formal approach (including MBSE) requires a higher up-front investment with the promise that the investment will be more than recouped over the overall lifecycle of the project. This can be seen in the following characteristic curves:

The red curve shows the traditional progression, where costs are low at the beginning and rise slowly. In contrast, the blue curve has a characteristic peak in the preliminary design phase, as MBSE requires a high level of effort for the initial creation of the model.

Whether MBSE is worthwhile or not depends on the integral of the two curves. To justify MBSE, the total expenditure must be not just a little, but considerably less than with the traditional approach. Finally, the risk is higher with MBSE: if - for whatever reason - the project has to be canceled, the damage is higher with MBSE due to the early investment.

To convince decision-makers of MBSE, the overall cost must be significantly lower than with traditional SE

The picture also shows the options for influencing the return on investment. On the one hand, the required investments can be minimized (left), or the benefits can be maximized (right).

Product lines benefit in particular from MBSE

Incidentally, we must also take the correct scope into account in these calculations. Investing in MBSE is particularly worthwhile when setting up a new product line, for example when developing a new industrial plant. Such systems are typically customized and dozens of systems are sold each year. In this case, MBSE could make the first of these new plants significantly more expensive than a traditionally developed plant, but all further plants in the product line will be cheaper, which means that a positive return on investment can be realized after a small number of plants.

Industry-specific analysis

At the end of the day, every company is different. It starts with the fact that MBSE requires a certain level of methodological maturity. Regulatory requirements also mean that some industries are more advanced than others. Nevertheless, the following table can be helpful in an initial analysis to create a first estimate for a company:

Conclusion

MBSE is not introduced "just like that". MBSE is a strategic topic that decision-makers need to be convinced of, and with hard figures. What Madni and Purohit present in their work is not really new. But it is a solid and understandable framework, and more importantly, it is current (2019). It contains valuable information to build an MBSE business case.

Photo by Roland Samuel on Unsplash