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Modernized automatic fire control system developed for the Paladin. |
After years of implementing acquisition reform, the Department of Defense (DOD) and the Department of the Army now are in the process of extending these reforms to logistics. The Army has introduced numerous initiatives as part of its Revolution in Military Logistics. One of these initiatives—one that is critical to the success of the Revolution in Military Logistics—is the Modernization Through Spares (MTS) concept.
In January 1996, Gilbert E. Decker, Assistant Secretary of the Army (Research, Development, and Acquisition), and General Leon E. Salomon, Commanding General of the Army Materiel Command, designated the Paladin/M109 family of vehicles (FOV) as the pilot program to test the MTS concept. This program evolved and was renamed the M109 FOV life-cycle fleet management pilot program in a May 1996 letter from Kenneth J. Oscar, Deputy Assistant Secretary of the Army (Procurement). The ability to execute MTS is critical to the success of the pilot program. The M109A6 Paladin is a 155-millimeter self-propelled howitzer. Other vehicles in the M109 FOV are the M109A2/A3 and M109A4/A5 as well as the M992A0/A1/A2 field artillery ammunition support vehicle.
M109 Fleet Management, as the program has come to be known, is an effort to reengineer the current system and establish a fleet manager as the single focal point for M109 FOV life-cycle sustainment support.
Automatic Fire Control Modernization
Historically, the Army has controlled the engineering development and production processes by directing industry in microscopic detail on how to design and manufacture weapon systems. Commercial industry, on the other hand, does not have the same relationship with its general public customers. The commercial business world determines market needs for products, then designs, manufactures, and supports these products without any customer input on how to do its business. DOD has moved in this direction through acquisition reform and the use of performance-based specifications that basically describe what the performance requirements are for a weapon system and not how to build weapon systems, as was traditionally done with military specifications. The Army now is taking this acquisition reform practice one step further into the logistics reform process with the acquisition of spare parts to performance-based specifications. This provides industry greater flexibility for cost-effective technology insertion, because DOD no longer dictates how to design and produce these spare parts. This is consistent with commercial business practices.
Midway through the Paladin production cycle, it became obvious that continuing to build the Paladin automatic fire control system (AFCS) to the traditional Army technical data package, with all of the how-to's, was contrary to the principles of acquisition reform. Problems with obsolete parts and the inability of the defense industry to produce electronic parts economically were beginning to impact AFCS production. This presented a challenge to the Paladin production program. If the AFCS could not be built in production, how could it be supported during the sustainment phase?
To meet this challenge, the principles of acquisition reform were applied. The microscopic technical data package was eliminated, and a performance-based specification to modernize the AFCS was developed. An accelerated acquisition maximized commercial technology. The AFCS military specifications system used a 32-bit military processor and a unique software operating system that was written to the military Ada standard. The modernized AFCS, as shown in the photograph on the next page, uses a commercial Pentium processor and operates in the Windows NT operating environment. The production and maintenance costs were reduced by 75 percent using an open system architecture technology that can be readily supported and upgraded during the sustainment phase. The AFCS now is in production and is being retrofitted on fielded Paladins. For this modernization action, the Paladin program saved $28 million and received the 1997 Defense Standardization Program annual group award.
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Modernized automatic fire control system developed for the Paladin. |
The AFCS modernization program was a nontraditional development and acquisition but was achievable because acquisition reform empowered the program manager (PM)-Paladin to make it happen. Since Paladin was in production and adequate procurement appropriation (PA) funding was available to fund the development of this modification to the Paladin vehicle, no funding polices prohibited this modernization.
The Fleet Management Program
The M109 Fleet Management program will establish a single contractor who will have primary responsibility for life-cycle sustainment support of all M109 FOV customers, including the Active Army, Army National Guard, and approved foreign customers. This is a significant step in the process of migrating to the commercial practices of letting industry design, manufacture, and support its products without directing the how-to. It is consistent with the primary objective of this pilot program to reengineer the sustainment process to maintain and improve system readiness while reducing life-cycle support cost for the M109 FOV. Accordingly, the contractor will use best commercial practices and new technology to establish an enterprise that integrates the best capabilities of the private and public sectors. The fleet manager will provide M109 FOV life-cycle sustainment support, including overall program management and support, fleet logistics sustainment support, system engineering and technical support, and secondary items support. It is expected that industry will provide the Army a system of distribution based on commercial business practice to replace the Army's current system of supply.
The memorandum implementing the Army MTS concept emphasized "dramatic reductions in life-cycle costs and dramatic improvements in performance and reliability." Critical to the life-cycle process is the process of replacement parts acquisition. Traditionally, the Army developed detailed technical data packages full of how-to methodology and, year after year, units would procure the same spare parts because the new technology to improve reliability was untimely and difficult to insert.
The cost of these parts has increased over the years, and the reliability of the parts has either stayed the same or declined. Therefore, the Army must improve the reliability of these parts in order to control skyrocketing sustainment costs. Of the systems the Army will have in 2010, 75 percent are being developed or fielded today. If no action is taken now, sustainment costs will escalate at even higher rates because of parts obsolescence and the inability of industry to cost effectively support these legacy systems. Commercial industry's answer is to modernize its products continuously in order to conduct business cost-effectively and compete in the market place.
The Need to Modernize Policy
The Paladin program is coming rapidly to the end of the production phase of the life cycle. With the end of production comes the end of availability of PA funding. This presents the PM with a dilemma on how to modernize and maintain the fleet with only operations and maintenance Army (OMA) funding. The fleet management concept will combine all of the appropriated OMA OPTEMPO funds into one account available for incremental funding to the fleet manager. Under the fleet management and MTS concepts, OMA funds cannot be used to improve reliability.
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MTS funds supported the development of the positioning and azimuth determining system. |
On 18 May 1998, the Principal Deputy for Acquisition, Army Materiel Command, issued a decision on MTS funding of the positioning and azimuth determining system (PADS) initiative (see photo below). This policy decision basically determined that modernization is the same as modification, and modifications cannot be funded with OMA. OMA can only be used to fund maintenance.
The maintenance versus modification distinction comes from the DOD Financial Management Regulation (FMR). The FMR broadly defines modification as the "…alteration, conversion, or modernization of an end item…which changes or improves the original purpose or operational capacity in relation to effectiveness, efficiency, reliability, or safety of that item." Therefore, to execute MTS as part of the fleet management program, policy will need to be changed.
Unlike the Army, commercial business does not have to deal with policies and restrictions in their continuous modernization activities. The DOD and the Army have made significant changes and improvements in their business processes relating to acquisition reform. The Army now is moving into logistics reform by maximizing use of contractor logistics support. However, for the combined acquisition reform and logistics reform initiatives to succeed, policy reform is needed so MTS can be executed successfully.
These policy reforms are outlined in the chart above. The chart illustrates current policy and adds a new column for modernization. These policy revisions are critical to the success of MTS. Given the current Defense budget funding levels, more funds will be required for sustainment, leaving less funding for PA's. Competition within DOD and the Army for PA funding will become more intense and will concentrate on new start weapon systems. Without the necessary changes to policy to permit using OMA to fund MTS, this budget situation will continue to deteriorate.
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This chart can be used to determine appropriate funding for item development and modernization. |
The Military Deputy to the Assistant Secretary of the Army (Research, Development, and Acquisition) sent a memorandum to the Deputy Chief of Staff for Operations and Plans, the Deputy Chief of Staff for Logistics, and the Director of Program Analysis and Evaluation requesting their support to restore momentum to the Army's MTS effort. He emphasized that the MTS program is the best tool we have to achieve a collective obligation to ensure that our soldiers have access to the finest, safest, and most efficient systems available. We can make the MTS vision happen with leadership support. ALOG
E. Carroll Gagnon was the Product Manager for the Paladin/Field Artillery Ammunition Support Vehicle Program at Picatinny Arsenal, New Jersey, when he wrote this article.