The Pentagon should develop a “clear, strategic” plan for the defense industrial base because the needs of the base have not been appropriately assessed in the past, according to the Aerospace Industries Association.
Fred Downey, vice president for national security at AIA, told Defense Daily during a phone call following a presentation yesterday at the Mitchell Institute for Airpower Studies that a “clear, strategic” plan is simple.
“A strategy always includes the goal you’re going trying to achieve in some manner and the way you have decided to go after that goal,” Downey said. “There are some policy considerations and decisions that have to be made (but): One, above all, is to actually do one.”
Downey said during the presentation at the Mitchell Institute the Defense Department has not appropriately assessed the needs of the base in the past because it didn’t need to. Downey said during the phone call that’s because there was once a time when there was so much competition and defense contractors competing for contracts that it wasn’t necessary for the Pentagon to have conversations with industrial base executives, but that isn’t the same world we live in now.
“The dialogue before you make that decision might be something like: ‘OK, what’s the minimum sustaining rate here?’” Downey said. “‘What are the core actions in production that need to be sustained? What kinds of actions to sustain that in a somewhat lukewarm position until we decide to go warm? And how do we handle the computation of those costs in corporate overhead?
“It’s one of those things strategy does and it’s also one of those things the Pentagon can no longer decide without the input of the responsible executives in the industrial base,” he added.
Downey said high technologies like the Expeditionary Fighting Vehicle (EFV), General Dynamics’ [GD] amphibious vehicle, would be a great place for DoD to start having discussions with the industrial base. The Pentagon announced last year its intention to cancel the EFV, which has been dogged by cost overruns.
Downey said, in general, the Pentagon needs to more align its requirements with what is actually doable and that certain technologies may not be realistic.
“The Pentagon establish [es] a requirement and presumes it can be executed, and that happens, frankly, for systems that will rely on technology that may not yet be fully developed,” Downey said. “Had competent industry officials been at the table in some manner during the early deliberations, even before there was a completion, [someone] might have been able to say: ‘Interesting idea, Marine Corps, but, frankly, very high risk execution from a technical and industrial manufacturing standpoint.’ [That] could have helped inform that process.”
Downey said during the phone call one way for DoD to assess the needs of the industrial base is identifying key suppliers, figuring out their health and discover ways to keep them on the job. He said part of the problem is the Pentagon doesn’t have a full inventory of all the suppliers in the defense industrial base.
Downey said the Pentagon does better at identifying suppliers in vertical, “program stovepipes,” but he said examining suppliers through the framework of stovepipes can be deceiving.
“They’ve looked at a couple of these stovepipes and said ‘Ah ha, well, everything looks OK,’” Downey said. “The suppliers for these two programs are in the game, they’re healthy enough. But further examination of this program found that both of those suppliers were dependent on one single supplier who wasn’t in very good shape. And, up to that point, nobody actually knew that.”
Downey said during his presentation the United States has, and has had, an adversarial relationship between industry and the Pentagon, but thanks to the help of Robert Gates, former defense secretary, and Defense Secretary Leon Panetta, that relationship is being “chipped away.”
But Downey also said it still exists in a lot of places.
“I remember a presentation at the Army War College and the first question to the group was, and they were mostly colonels at that point, ‘How many of you think industry ought to make a profit,’” Downey said. “Now the good news is that three-quarters of them put their hands up. The bad news was it took over an hour of dialogue before they did. So that has to change.”