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Making Architecture Design Decisions: An Economic Approach

September 2002 Technical Report
Rick Kazman, Jai Asundi, Mark H. Klein

This report describes the improvements to the CBAM (Cost Benefit Analysis Method) and provides a pilot case study conducted with NASA.


Software Engineering Institute

CMU/SEI Report Number


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The resources available to build any system are finite. The decisions involved in building any nontrivial system are complex and typically involve many stakeholders, many requirements, and many technical decisions. The stakeholders have an interest in ensuring that good design decisions are made—decisions that meet their technical objectives and their tolerance for risk. These decisions should, as much as possible, maximize the benefit that the system provides and minimize its cost. The Cost Benefit Analysis Method (CBAM) was created to provide some structure to this decision-making process. The CBAM analyzes architectural decisions from the perspectives of cost, benefit, schedule, and risk. While the CBAM does not make decisions for the stakeholders, it does serve as a tool to inform managers and to structure the inquiry so that rational decisions can be made. This report describes the steps of the CBAM and its application to a real-world system.