WEST BETHESDA, Md. –
Acquisition was again the subject at the Rear Adm. David Taylor Naval Architecture Lecture on May 16, but this time, the lesson came from someone who has been at the top.
Dr. Donald Winter, secretary of the Navy from 2006 to 2009, spoke about his experience in contracting throughout his career, as well as when he was the secretary.
Winter provided a few postulates about acquisition to prepare the audience for discussion: acquisition is not just procurement; acquisition of complex systems is difficult; acquisition of naval vessels is even more difficult; systems engineering is the key to making acquisition work; and, getting acquisition right is important. He also posed three basic questions when thinking about providing a new asset to the fleet.
“You have to decide what it is you want to buy; you have to decide how you want to buy it; and then, and only then, can you get to the question of who you are going to buy it from,” Winter said.
Part of the complexity stems from having multiple stakeholders with differing priorities and agendas, which can result in conflicting objectives. These stakeholders include Navy leadership, Navy operators, Congress, the Office of Management and Budget and industry.
In addition, Winter said that real-world problems are often poorly defined. Stakeholders have a hard time translating their objectives into engineering terms.
“Some people want to have a ship that’s really inexpensive; some people want to have a ship that’s really fast; some people want to have a ship that has got great survivability,” Winter said. “And those are not necessarily well-aligned objectives.”
Winter said that using the principles of systems engineering is the best way to reconcile the inconsistencies between objectives.
“Systems engineering is a methodology to convert objectives to requirements that can provide direction to the design teams,” Winter said.
As part of the systems engineering process, Winter said the stakeholders and their objectives are identified and various alternative system concepts are developed in an attempt to reconcile conflicts among stakeholders and address the priority objectives. This requires an understanding of where trades are possible. Once a preferred concept is chosen, a system specification can be developed documenting the top-level system requirements.
Identifying a suitable system concept generally requires looking into the future at what the mission might be.
“In particular, one of the problems I’ve seen is that it’s very difficult to forecast what we really need from a mission point of view because of the tremendous lag between the conceptual work that’s done and the actual employment of those assets as part of some naval group in the future,” Winter said.
When it comes to actually figuring out how to acquire something, Winter said people often fail to think through the options that are available. He used the U.S. Navy’s development of the Electromagnetic Aircraft Launch System (EMALS), which replaced the steam-driven catapults on Ford-class carriers (CVN 21), and the Advanced Arresting Gear (AAG), which replaced the hydraulic system. There were two reasons Winter thought this program has been compounded with difficulties: EMALS and AAG were developed concurrently with CVN 21; and they were procured by the Navy and provided to the shipbuilder as government-furnished equipment.
“Concurrent development is a disaster. If you take a look at the technology readiness level associated with EMALS at the time that decision was made, there was no way that it should have been approved for concurrent development,” Winter said. “We are still trying to figure out the operational suitability of this whole configuration.”
When selecting a contractor, Winter said there are two basic options: lowest price, technically acceptable; and best-value determination. Except for the simplest vessels, the process tends to be best-value determination. He said that the challenge is determining what constitutes best value for the Navy. Best value is typically defined as the highest performance at the lowest cost. Unfortunately, this view motivates bidders to eliminate all performance margins and include the plans and costing for only the essential activities, without any reserves. The resultant program plan is inexecutable as it provides no mechanism to deal with the inevitable developmental problems.
“I’ve yet to see a program that’s gone through as planned,” Winter said. “I find LCS (littoral combat ship) to be particularly illustrative of this problem.”
Winter said that about 20 years ago, the Navy set objectives for small surface combatants to address the emerging “green water” threats, such as the Iranian Revolutionary Guard Corps Navy. They wanted it to be 40-plus knots with reduced manning, all for $220 million; and they wanted 55 of them. The contractors naturally said they could do it, but the designs compromised reliability and sustainability.
“I keep wondering what would have happened if we had been honest and said the cost was going to be $550 million, which is about where it’s at now,” Winter said.
Winter said systems engineering also needs to continue post award of the contract and throughout the development process.
“The most important aspect is that the lives of the future Sailors in our Navy are at risk, and they are depending on us to do this right,” Winter said.