The central global database of all your estimated costs is known as the "cost model". This model is generated from labor, material, travel and other direct cost estimates provides by your subject matter experts in your company (such as engineers). As well as considering these estimates, and breaking down the estimated costs into a cost by month, the cost model is influenced by:

• Indirect cost rates and formula such as for fringe, overhead and G&A burdens
• Labor rate changes over fiscal years based on the specific distribution of labor over time
• Parameter values for formula-based costs such as contingency, freight, QA/audit or travel
• Escalation rates or factors
• Risks and opportunities for risk adjusted costs.

The cost model for non-parametric estimates, outlined above, is generated automatically in real time anytime your estimate is at a workflow status or stage which updates the cost model automatically (based on configuration). There can be a few minutes delay especially if lots of people are updating multiple project estimates at the same time or when running the process to update and cost the consolidated BOM for purchased or manufactured parts in large product configurations, but it is in real-time for practical purposes.

The cost model for estimates based on a formula with parameters is generated on demand by the user. Click on the "More" toolbar button in your proposal/project or in the costing workbench and select "Generate Cost Model incl. Formula" from the menu, as highlighted below. This will:

1. Re-evaluate and calculate the result for every labor, material, travel and other direct cost estimate which is based on a parametric formula, sizing input or cost estimating relationship
2. Check to see if the cost model is complete, i.e. whether all your estimates are ready to be costed
3. Summarize the total estimated direct + indirect cost onto each WBS in your project
4. Roll the estimated cost up your Work Breakdown Structure to view in the "Cost Estimate (Rolled-up)" column
5. Update the cost of each asset or proposal line item based on the WBS / line item percentage allocations
6. Update the bill of material unit cost based on all estimated material costs for that component or part number
7. You can also see the status of the cost model update procedure and when it was last run (highlighted below).

Please note the following important considerations:

1. Individual labor, material, travel and ODC estimates not based on a formula are not re-calculated from this menu option, to save time. If you want to force every estimate in your proposal to be re-evaluated then select 'Update Entire Cost Model' from the exchange rates popup 'Update Rates' button menu. You should do this when you modify something like the proposal currency, exchange rate or modify one or more of the escalation or indirect costing rates, any of which can impact the cost of your proposal
2. Because cost model generation is an intensive process, care should be taken not to run it too frequently, especially when re-generating the entire cost model as mentioned in the previous bullet point. Cost model re-generation may take up to 15 minutes to run, in the background. Reload your screen data to see the resulting costs
3. Formula-based labor, material and other direct costs may be based on the result of another formula; for example "Travel is 15% of onsite labor including Program Mgt. Office labor" which in turn is "15% of all system engineering and testing labor". Maintain the rank or sequence in your formula to ensure that they are processed in the correct order, as:
   1. No sequence (or rank = 1) for formulae which do not depend on the results from any other formula
   2. Rank = 2 for formula which depend on the result of only no-sequence or rank = 1 formulae
   3. Rank = 3 for other formula which depend on the result of ranked 2 and higher formulae.

In the example above the formula for Program Mgt. Office labor would have rank = 1 and for travel, rank = 2.