Best Practices: DOD Can Achieve Better Outcomes by Standardizing the Way Manufacturing Risks Are Managed
GAO-10-439
Published: Apr 22, 2010. Publicly Released: Apr 22, 2010.
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Highlights
Cost growth and schedule delays are prevalent problems in acquiring defense weapon systems. Manufacturing systems has proven difficult, particularly as programs transition to production. In December 2008, the Department of Defense (DOD) issued an updated version of its acquisition policy that reflects earlier consideration of manufacturing risks. A joint defense and industry group developed manufacturing readiness levels (MRL) to support assessments of manufacturing risks. Use of MRLs on all weapon acquisition programs has been proposed. In response to a congressional request, this report assesses the manufacturing problems faced by DOD, how MRLs can address manufacturing problems, how MRLs compare to manufacturing best practices of leading commercial firms, and challenges and barriers to implementing MRLs at DOD. In conducting our work, we contacted DOD, military services, and contractors; held interviews with leading commercial firms; reviewed program documents and policy proposals; and spoke with manufacturing experts.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | To ensure that DOD is taking steps to strengthen and improve the producibility and manufacturing readiness of technologies, weapon systems, subsystems, or manufacturing processes, the Secretary of Defense should require the assessment of manufacturing readiness across DOD programs using consistent MRL criteria as basis for measuring, assessing, reporting, and communicating manufacturing readiness and risk on science and technology transition projects and acquisition programs. |
In April 2010, GAO found that the Department of Defense was lacking manufacturing knowledge at key decision points and that, although there have been a variety of evaluations performed for years, there was no uniform way to measure and communicate manufacturing risk and readiness. GAO recommended that defense programs be assessed using manufacturing readiness level (MRL) criteria for assessing, reporting, and communicating manufacturing readiness risk on programs. In July 2011, the Department updated its Defense Acquisition Guidebook which provides that the MRL Deskbook be used as a tool and resource to help defense programs with manufacturing related reporting and oversight.
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| Department of Defense | To ensure that DOD is taking steps to strengthen and improve the producibility and manufacturing readiness of technologies, weapon systems, subsystems, or manufacturing processes, the Secretary of Defense should direct the Office of the Director, Defense Research and Engineering to examine strengthening the MRL criteria related to the process capability and control of critical components and/or interfaces prior to milestone C, or equivalent, for low-rate initial production decision. | In April 2010, GAO found that the Department of Defense required their manufacturing processes and procedures to be in control after the production decision (milestone C) whereas commercial best practice requires that manufacturing processes be in control prior to the production decision. GAO recommended that the criteria--to include the process capability and control of critical components and/or interfaces--be strengthened for making the initial production decision. The Department of Defense concurred with this recommendation and subsequently revised and strengthened its production decision criteria. The Department's deskbook that contains the strengthened manufacturing criteria on...
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| Department of Defense | To ensure that DOD is taking steps to strengthen and improve the producibility and manufacturing readiness of technologies, weapon systems, subsystems, or manufacturing processes, the Secretary of Defense should direct the Office of the Director, Defense Research and Engineering to assess the need for analytical models and tools to support MRL assessments. | In April 2010, GAO issued a report identifying commercial best practices on the use of analytical models and tools that could support assessments of manufacturing readiness. To enhance the use of manufacturing assessments, GAO recommended that the Department of Defense assess the need for such models and tools in supporting assessments of manufacturing readiness. The Department agreed to initiate efforts to capture this knowledge and provide tools for use in conducting assessments. The Department also updated its Defense Acquisition Guidebook in July 2011 that provide references to tools and resources that can be found in the Manufacturing Readiness Level (MRL) Deskbook. The May 2011 MRL...
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| Department of Defense | To ensure that DOD is taking steps to strengthen and improve the producibility and manufacturing readiness of technologies, weapon systems, subsystems, or manufacturing processes, the Secretary of Defense should assess the adequacy of the manufacturing workforce knowledge and skills base across the military services and defense agencies and develop a plan to address current and future workforce gaps. | GAO issued a report identifying an overall decline of manufacturing expertise in the workforce across the Department of Defense and the industrial base to conduct the work and perform manufacturing readiness level (MRL) assessments. To address concerns about the Department's diminishing manufacturing workforce that could hamper efforts to implement MRL assessments, GAO recommended the Department of Defense to assess its manufacturing workforce knowledge and skills across the services and agencies and develop a plan to address current and future workforce gaps. In April 2010, the Department reported that each of the services and other defense components were planning and deploying...
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Topics
Best practicesCost effectiveness analysisDefense capabilitiesDefense cost controlDefense industryDefense procurementDevelopment systemsLessons learnedManufacturing industryNeeds assessmentProcurementProcurement planningRisk assessmentRisk factorsSchedule slippagesStandardsTechnologyWeapons research and developmentWeapons systemsSystems designCost analysisCost growth