Improved Management of Fleet Supplies and Spare Parts Can Save Millions Without Affecting Readiness

GAO reviewed the Navy's supply support to assess actions taken by the Navy in response to earlier GAO reports on shipboard supply management and to evaluate the effectiveness of supply support provided by the Navy's automated surface ships.

GAO found that the Navy has acted on some of the earlier recommendations and has achieved savings of at least $89 million. However, the Navy has taken little or no action on other recommendations. Additional opportunities are available for the Navy to save as much as $94 million over a 5-year period on the procurement of repair parts and supplies by adopting more stringent criteria for submarines and tenders and by the use of automated surface ships. These savings can be accomplished by improving: (1) shipboard management policies and controls to ensure that excess inventories are not retained aboard the ship after supply overhauls and that the Navy adopts a stockage criterion which is standard and will produce the best results in terms of trade-offs among investment, timely filling of requisitions, and stock excessing actions; (2) visibility over shipboard supply by insisting that authorized allowances be adhered to; (3) the process for identifying, redistributing, and offloading excess materials on a timely basis; and (4) the accuracy rate of physical inventories.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Henry W. Connor Team: General Accounting Office: Procurement, Logistics, and Readiness Division Phone: (202) 275-4141