Defense Inventory
Improved Industrial Base Assessments for Army War Reserve Spares Could Save Money Gao ID: GAO-02-650 July 12, 2002The Army's approach to assessing wartime spare parts industrial base capability does not use current data from industry. Instead, the Army uses historical parts procurement data because its prior efforts to collect current data from industry were not successful due to poor response rates. GAO identified a program in the Defense Logistics Agency (DLA) that has several attributes reflecting sound management practices for reliable industrial base capability assessments. Although DLA's program is in its early stages of implementation, DLA has been able to successfully collect current data directly from private industry on thousands of parts. Further, DLA is analyzing that data to identify actual or potential parts availability problems.
RecommendationsOur 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: Team: Phone:GAO-02-650, Defense Inventory: Improved Industrial Base Assessments for Army War Reserve Spares Could Save Money
This is the accessible text file for GAO report number GAO-02-650
entitled 'Defense Inventory: Improved Industrial Base Assessments for
Army War Reserve Spares Could Save Money' which was released on July
12, 2002.
This text file was formatted by the U.S. General Accounting Office
(GAO) to be accessible to users with visual impairments, as part of a
longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the printed
version. The portable document format (PDF) file is an exact electronic
replica of the printed version. We welcome your feedback. Please E-mail
your comments regarding the contents or accessibility features of this
document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
United States General Accounting Office:
GAO:
Report to Congressional Committees:
July 2002:
Defense Inventory:
Improved Industrial Base Assessments for Army War Reserve Spares Could
Save Money:
GAO-02-650:
Contents:
Letter:
Results in Brief:
Background:
Army Industrial Base Assessments Do Not Use Current Industry Data:
Opportunities Exist to Improve the Reliability of the Army‘s Industrial
Base Capability Assessments:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Scope and Methodology:
Appendix I: Defense Logistics Agency Industrial Base Planning:
Data Collection Tool:
Analytical Tool:
Appendix II: Comments from the Department of Defense:
Appendix III: Staff Acknowledgments:
Tables:
Table 1: Industrial Base Assessment Attribute Comparison between
Defense Logistics Agency and Army:
Table 2: The Army‘s Fiscal Year 2003-2007 War Reserve Spare Parts Plan:
Table 3: Production Lead times for Selected War Reserve Spare Parts:
Table 4: Industrial Base Assessment Attribute Comparison between DLA
and Army:
Table 5: Program Data Fields and Descriptions:
Figure:
Figure 1: Army‘s Steps for Determining War Reserve Spare Parts
Shortfalls:
[End of section]
United States General Accounting Office:
Washington, DC 20548:
July 12, 2002:
Congressional Committees:
This report follows up on our May 2001 recommendation that the
Secretary of the Army develop improved estimates of private industry‘s
spare parts production capability for meeting currently projected
wartime scenarios. [Footnote 1] We made this recommendation after we
found that the Army relied on internally generated data rather than on
current data from industry to develop its industrial base capability
assessments. [Footnote 2] The Army concurred with our recommendation
and cited actions it intends to take. Improvements to industrial base
capability assessments could lead to increased readiness and to reduced
costs for unneeded wartime spare parts inventories.
In this report, we address whether (1) the Army has begun to collect and
use current industrial base data and (2) opportunities exist to improve
the reliability of the Army‘s industrial base capability assessments.
To accomplish this review, we interviewed Army officials who are
responsible for estimating the requirements and developing budgets for
war reserve spare parts and for assessing what portion of those
requirements private industry is capable of providing. We also talked
with officials from the Defense Logistics Agency about its industrial
base assessment program.
Results in Brief:
The Army‘s approach for assessing wartime spare parts industrial base
capability still does not use current data from industry. Instead, the
Army uses historical parts procurement data because its prior efforts
to collect current data from industry were not successful due to poor
response rates. The Army‘s assessments depend on historical data and
resulting lead-time factors to project industry‘s contribution to
satisfying wartime spare parts requirements. Without current data on
industry‘s capability, assessments could be unreliable, resulting in
reduced readiness due to critical spare parts shortfalls in wartime or
inflated and costly war reserve spare parts inventories in peacetime.
Moreover, the Army‘s budget requests to Congress for war reserve spare
parts risk being inaccurate. [Footnote 3]
Opportunities exist to improve the Army‘s industrial base capability
assessments. After issuing our May 2001 report, we identified a program
in the Defense Logistics Agency that has several attributes reflecting
sound management practices that are required for reliable industrial
base capability assessments. Our analysis of the approach used by the
Army compared to the Defense Logistics Agency‘s spare parts industrial
base assessment program revealed that the Army‘s approach can be
improved in three areas”data collection, data analysis, and management
strategies. Table 1 highlights the key attributes where there are
opportunities to improve the Army‘s assessments, based on the program
used by the Defense Logistics Agency (DLA).
Table 1: Industrial Base Assessment Attribute Comparison between Defense
Logistics Agency and Army:
Attribute: Data collection: Collects current data from industry;
DLA: Yes;
Army: No.
Attribute: Data collection: Uses Internet based survey;
DLA: Yes;
Army: No.
Data collection: Data analysis: Models current production capability;
DLA: Yes;
Army: No.
Data collection: Data analysis: Identifies problems for future
management actions;
DLA: Yes;
Army: No.
Data collection: Management strategies: Creates acquisition strategies;
DLA: Yes;
Army: No.
Data collection: Management strategies: Targets industrial base
investments;
DLA: Yes;
Army: No.
Source: GAO‘s analysis.
[End of table]
Although DLA‘s program is in its early stages of implementation, DLA has
been able to successfully collect current data directly from private
industry on thousands of parts. Further, DLA is analyzing that data to
identify actual or potential parts availability problems. From this
analysis, it has created management strategies for changing its
acquisition procedures and making targeted investments in material and
technology resources to reduce production lead times. For example, DLA
identified an unusually long lead time of 360 days for an electronic
part that, with a targeted investment, it was able to reduce to 30
days, saving approximately $600,000.
We are making recommendations to the Secretary of Defense for the Army
to create management strategies for improving wartime spare parts
availability that can save money, improve readiness, and provide more
realistic budget requests to Congress. The Department of Defense (DOD)
partially concurred with our recommendations because it did not agree
with details about how the attributes we cited could enhance the Army‘s
current process for assessing industrial base capabilities. Its concerns
principally centered on the need for the Army to have flexibility in
implementing the program and the additional resources required to
maintain more accurate data. As discussed in the agency comments
section of this report, we continue to believe our recommendations
provide an opportunity to enhance the Army‘s program while allowing this
flexibility.
Background:
DOD‘s current policy calls for each military service to determine its
requirements and acquire sufficient war reserve materiel for the
execution of current wartime scenarios and to be able to sustain these
operations until being re-supplied. [Footnote 4] Thus, in developing
their plans, the services must consider the availability of spare parts
in their peacetime operating stocks, their war reserve spare parts
inventories, and from the industrial base, and then estimate what
additional materiel they need to buy. The Army‘s industrial base and
stationing strategies and DOD‘s regulations reflect the importance of
the industrial base in supporting wartime operations and require the
services to rely on the industrial base to the maximum extent possible.
[Footnote 5] In addition, the Army is required to maintain a viable
capability to monitor and assess the health of the industrial base and
identify potential risks. [Footnote 6]
The U.S. Army Materiel Command is responsible for determining the
Army‘s requirements for war reserve spare parts, as well as the Army‘s
estimate of what private industry can be expected to provide during
wartime, in order to derive the war reserve spare parts shortfall.
[Footnote 7] It receives technical expertise from the Army Materiel
Systems Analysis Agency in determining its war reserve requirements and
an estimate of what can be expected from private industry. The
Command‘s major subordinate commands are responsible for purchasing
specific types of materiel, such as aviation, tank, automotive, and
communications parts, and they have a limited number of industrial base
specialists who can be assigned to provide data for assessments. Figure
1 illustrates the steps that the Army follows to determine its war
reserve shortfall.
Figure 1: Army‘s Steps for Determining War Reserve Spare Parts
Shortfalls:
[See PDF for image]
The following data is depicted:
Begin with:
War materiel requirement.
Fulfilled by:
Peacetime inventory on hand;
War reserve inventory on hand;
Industrial base production.
Results in:
Total war spare parts shortfall.
Source: GAO analysis.
[End of figure]
To plan how much war reserve materiel it needs to buy, the Army
develops estimates of when spare parts will be available from the
industrial base during wartime so that it can determine how much war
reserve materiel it needs to buy and put into its war reserve
inventory. In preparing its estimates, the Army first calculates the
total amount of war materiel that it needs to support current wartime
scenarios. Specifically, it calculates its requirements by using a
computer model that considers several factors, such as spare parts
usage and breakage rates. Next, it determines the amount of peacetime
and war reserve inventories that are available to meet that
requirement. The Army then applies the amount it estimates the
industrial base can be expected to provide during wartime. The
remaining amount is considered the total spare parts shortfall. The
total shortfall can then be divided into the amount for which Congress
has authorized funding, any amounts budgeted for future years, and an
additional amount the Army has not yet requested from Congress.
As table 2 shows, in preparation for its fiscal year 2003 budget
submission to Congress (part of the fiscal year 2003-2007 out-of-cycle
Program Objective Memorandum), the Army calculated that it required
$3.30 billion for its wartime spare parts. Of this amount, it estimated
that $1.93 billion worth of spare parts would be available from
peacetime and war reserve inventories. Another $0.13 billion expected
to be available from private industry was applied. The resulting total
spare parts shortfall was $1.24 billion. Of this amount, the Army has
been funded $0.11 billion for fiscal years 2000-2002 and expects to
request $0.47 billion in fiscal years 2003-2007. Overall the Army
reports a total spare parts shortfall of approximately $0.66 billion.
[Footnote 8]
Table 2: The Army‘s Fiscal Year 2003-2007 War Reserve Spare Parts Plan
(Dollars in billions):
Calculated costs of required wartime spare parts:
Subtotal: [Empty];
Total: 3.30.
Peacetime inventory on hand:
Subtotal: 0.63;
Total: [Empty].
War reserve inventory on hand:
Subtotal: +1.30;
Total: [Empty].
Inventory to be available:
Subtotal: 1.93;
Total: -1.93.
Remaining unfilled requirement:
Subtotal: [Empty];
Total: 1.37.
Estimated amount from private industry:
Subtotal: [Empty];
Total: -0.13.
Estimated amount still needed to fulfill requirement (spare
part shortfall):
Subtotal: [Empty];
Total: 1.24.
Funding for fiscal years 2000-02:
Subtotal: [Empty];
Total: -0.11.
Expected funding for fiscal years 2003-07:
Subtotal: [Empty];
Total: -0.47.
Shortfall remaining:
Subtotal: [Empty];
Total: 0.66.
Source: Fiscal Years 2003-07 Program Objective Memorandum for the Army.
[End of table]
Army Industrial Base Assessments Do Not Use Current Industry Data:
The Army‘s approach for assessing wartime spare parts industrial base
capability still does not use current data from industry. Rather, the
Army‘s assessments of industry‘s capability to produce spare parts in
wartime depend on historical data and lead-time factors that the Army
develops itself. Without current data on industry‘s capability,
assessments could be unreliable, resulting in reduced readiness due to
critical spare parts shortfalls in wartime or inflated and costly war
reserve spare parts inventories in peacetime. Moreover, the Army‘s
budget requests to Congress for war reserve spare parts risk being
inaccurate.
In the past, the Army collected data directly from private industry
through paper questionnaires to industry representatives that were up
to 22 pages long. [Footnote 9] It stopped this practice primarily
because of the poor response rates. According to Army Materiel Command
officials, industry representatives said they saw no apparent direct
benefit from filling in the lengthy questionnaires and, moreover, felt
they should be compensated for their time and effort. We were told that
command officials themselves do not believe that collecting current
data from industry is cost-effective.
Now, rather than collecting current data from private industry, the Army
uses data that it acquired several years ago from private industry to
create lead-time factors for estimating its wartime industrial base
capability. These factors are based on out-of-date industry data.
Furthermore they were developed from a limited range of spare part
items but were applied to all parts needed for war. For example, in
developing its fiscal year 2003 budget submission to Congress, the Army
used a formula with wartime lead-time factors that were derived from
estimated accelerated peacetime administrative lead times and
production lead times. [Footnote 10] These accelerated lead-time
factors of 85 and 61 percent, respectively, were based on data obtained
prior to 1998 for specific items, such as howitzers, that were managed
by the Army Tank and Automotive Command‘s Rock Island facility.
According to an Army document, [Footnote 11] this method of calculating
lead times fails to account for variations that exist from item to item
and can lead to unrealistic industrial base capability estimates. For
example, a 1998 Army study found that 44 of 86 parts assumed to be
supported by industry could not be and that 176 of 218 parts that were
assumed not to be supported by the industrial base were.
Partly in response to the recommendation in our prior report, the Army
has several initiatives underway to improve its industrial base
capability assessments, but these initiatives continue to focus on
historical, rather than current industry data. In one initiative, the
Army is developing a new approach to calculate its wartime spare parts
requirements, in part, from data collected from private industry during
1998. In another, the Army Materiel Command has designed a tool”called
the Industrial Base Hub [Footnote 12]”that brings together in one Web-
based automated system a broad range of existing industrial base data.
The data consist of war reserve requirements, producer capabilities,
contract awards and actions, contractor businesses, and commercial
businesses and finances. The Industrial Base Hub relies on historical
data rather than on current data from industry. In a third initiative,
the Army Materiel Systems Analysis Agency has proposed periodically
collecting data on production lead times for the 100 costliest spare
parts, which account for 70 percent of the total dollar value of the
entire wartime spare parts requirement. The Army Materiel Systems
Analysis Agency believes that collecting current data periodically from
the private manufacturers of the top 100 costliest spare parts could be
a reasonable way to get a cost-effective, reliable industrial base
offset estimate.
Opportunities Exist to Improve the Reliability of the Army‘s Industrial
Base Capability Assessments:
The Army could improve the reliability of its industrial base
assessments by considering several key attributes present in DLA‘s
industrial base assessment program. These include the collection of up-
to-date industry data, the timely analysis of data to develop current
and reliable industrial base assessments, and the use of analytical
data to create management strategies aimed at reducing spare parts
costs and the risk of shortfalls.
DLA‘s Assessment Program:
To improve its management of spare parts for the services, and thus
reduce costs and inventory, DLA re-engineered its industrial base
capability assessment program. DLA‘s assessment program, called the
Worldwide Web Industrial Capabilities Assessment Program, was started
in the fall of 1999. It consists of a data collection tool and an
analytical tool, which is used to create management strategies. (See
appendix I for a more detailed description.) The data collection tool
provides the capability to gather new and updated information directly
from private companies via the Internet. Company representatives
voluntarily respond to a series of on-line survey questions that,
depending on how answered, are self-tailored to that company to
simplify and speed up the survey process.
Private companies provide information on what spare part items they can
provide (or are willing to provide); what quantities they can produce;
how long it will take to produce them under different scenarios (e.g.,
normal or crisis conditions); and what potential bottlenecks (e.g.,
availability of certain materials, or equipment constraints) exist that
could limit the production of certain spare parts. DLA validates this
information as part of its assessment process before acting on the
information.
The program‘s analytical tool provides analysts with immediate access to
the automated data collected from industry. This provides the
capability to develop timely and reliable assessments of industry‘s
ability to provide various spare parts in peacetime as well as wartime.
In addition, it provides the capability to use the analytical data to
identify actual or potential parts availability problems (e.g., items
with unusually long lead times or items that are involved in
bottlenecks) and, based on this information, to create a management
strategy for resolving these problems, for example, by changing its
acquisitions procedures or targeting investments in material and
technology resources to reduce production lead times.
Benefits of DLA‘s Assessment Program:
Although DLA‘s industrial base assessment program is relatively new, it
provides a number of examples that illustrate the effectiveness of
collecting current data directly from the industrial base. Table 3
shows the impact on production lead time when it is based on up-to-date
industry data. For example, clamp couplings for tanks, aircraft, and
aircraft engines have a production lead time of 35 days during a crisis
(surge) situation rather than a lead time of 156 days (lead time of
record) previously estimated by DLA for normal, or peacetime,
situations.
Table 3: Production Lead Times for Selected War Reserve Spare Parts:
Weapon system: Helicopters, aircraft engines;
Spare part item: Resilient mount;
Industry surge lead time[A]: 70;
Lead time of record[B]: 163.
Weapon system: Communications satellite terminal;
Spare part item: Centrifugal fan;
Industry surge lead time[A]: 56;
Lead time of record[B]: 109.
Weapon system: Communications;
Spare part item: Tube axial fan;
Industry surge lead time[A]: 45;
Lead time of record[B]: 125.
Weapon system: Tanks, aircraft, and aircraft engines;
Spare part item: Clamp coupling;
Industry surge lead time[A]: 35;
Lead time of record[B]: 156.
Weapon system: Aircraft;
Spare part item: Clamp coupling;
Industry surge lead time[A]: 35;
Lead time of record[B]: 65.
Weapon system: Aircraft and support equipment;
Spare part item: Clamp coupling;
Industry surge lead time[A]: 35;
Lead time of record[B]: 49.
[A] The surge production lead-time estimate, based on industry‘s
response to DLA‘s survey, refers to the best possible production lead
time (in days) for an item in a crisis situation which is date of
contract award to date of receipt of first significant delivery.
[B] The production lead time of record estimate is a computed new
average production lead time (in days) that factors in the latest
actual production lead time, the number of days from contract award to
date of contract delivery and subsequently the receipt date of first
significant delivery, and the old production lead time of record in the
system. It is designed for normal, or peacetime, situations.
Source: DLA Worldwide Web Industrial Capabilities Assessment Program.
[End of table]
This more reliable information could result in greater economy in
purchasing decisions. For example, private industry says it can provide
a resilient mount within 70 days during a crisis rather than in the 163
days that DLA previously estimated. The war reserve requirement for
this item occurs during the first 3 months of a war. The reduction in
production lead time from 163 to 70 days means that the third month
could be covered with a savings of $4,810 by not buying the items.
[Footnote 13] Likewise, the war reserve requirement for the centrifugal
fan spreads over the first 6 months of a war with the bulk occurring
during the last 3 months. The lead-time reduction from 109 days to 56
days means that months 2-6 could be covered with a savings of $62,560
by not buying the items.
Additional benefits from the assessment program stem from evaluating
currently collected and analyzed information to identify potential
problems with production and create various management strategies to
resolve them. For example, by identifying an unusually long lead time
for a cesium lamp and examining the reasons for this, DLA was able to
ultimately reduce the lamp‘s lead time of 360 days to only 30 days. The
lamp is used on several types of Navy, Marine Corps, and Air Force
aircraft in electronic counter measure systems to defeat infrared
missiles. The lamp cartridge, which is a critical element used in these
systems, is made of exotic materials and operates at extreme
temperatures and power levels.
An industrial capabilities assessment concluded that the lead time of
record for this item was 360 days. Negotiations with the vendor,
however, reduced this to 300 days. The lead time of 300 days is due to
the use of highly technical processes and several long-lead-time
materials in its production. Because of the unique nature of the cesium
lamp, additional measures were needed to reduce the lead time further.
As part of a targeted investment, DLA awarded a contract to preposition
and rotate long-lead materials and partially finished components,
resulting in a further 270-day reduction in lead time to 30 days. As a
result, DLA is spending $530,000 for this investment, compared with the
$1.1 million it would cost to purchase and store an equivalent amount
of finished product to meet war reserve requirements, saving
approximately $600,000.
Army Industrial Base Capability Assessments Can Be Improved:
The Army‘s approach for assessing wartime spare parts industrial base
capability can be improved. A comparative analysis of DLA‘s program to
the Army‘s approach shows opportunities to improve, specifically in the
areas of data collection, data analysis, and management strategies.
Table 4 compares the DLA and Army industrial base assessment approaches
for the three key attributes.
Table 4: Industrial Base Assessment Attribute Comparison between DLA
and Army:
Attributes: Data collection: Collects current data from industry;
DLA: Yes;
Army: No.
Attributes: Data collection: Maintains a deliberate, ongoing program to
collect current data;
DLA: Yes;
Army: No.
Attributes: Data collection: Conducts follow-up to encourage
participation;
DLA: Yes;
Army: No.
Attributes: Data collection: Uses Internet based survey rather than
paper;
DLA: Yes;
Army: No.
Attributes: Data collection: Saves input time through a self tailoring
survey instrument;
DLA: Yes;
Army: No.
Attributes: Data collection: Uses a unique classification strategy to
group industry items;
DLA: Yes;
Army: No.
Attributes: Data analysis: Incorporates current data into Internet
based analytical tool;
DLA: Yes;
Army: No.
Attributes: Data analysis: Allows immediate access to current industry
data;
DLA: Yes;
Army: No.
Attributes: Data analysis: Uses current and historical data to model
industry capability;
DLA: Yes;
Army: No.
Attributes: Data analysis: Identifies item shortfalls for further
analysis;
DLA: Yes;
Army: No.
Attributes: Management strategies: Meets requirement to assess
industrial base capability;
DLA: Yes;
Army: No.
Attributes: Management strategies: Creates acquisition strategies;
DLA: Yes;
Army: No.
Attributes: Management strategies: Targets industrial base investments;
DLA: Yes;
Army: No.
Attributes: Management strategies: Reduces lead times and saves money;
DLA: Yes;
Army: Unknown.
Attributes: Management strategies: Links results of analysis to its
strategy;
DLA: Yes;
Army: No.
Source: GAO analysis.
[End of table]
By focusing on the above attributes, DLA‘s industrial base capability
assessment program has become an improved, simplified, time-saving
process for companies to provide current production capability data. For
example, the process uses a streamlined Internet based data collection
tool that industry representatives say is an improvement over the old
paper process. Also DLA uses follow-up letters and phone calls to
encourage use of the online data collection tool. Companies can then
participate with DLA in creating management strategies to reduce lead
times, which can reduce required war reserve inventories.
Conclusions:
Industrial base capability assessments designed to have current data
such as DLA‘s create opportunities for sound decision making regarding
the planning for and purchase of Army war reserve spare parts. The
Army‘s approach to industrial base capability assessments lacks key
attributes that include the collection of current industry data, the
analysis of that data and the creation of management strategies for
improving wartime spare parts availability. Out-of-date data could
result in reduced readiness and inflated or understated war reserve
spare parts funding requests within budget submissions to Congress.
Without a process that provides such analysis, the Army cannot identify
long lead times and create management strategies to reduce lead times
and thus the amount of inventory needed.
Recommendations for Executive Action:
In order to improve the Army‘s readiness for wartime operations, achieve
greater economy in purchasing decisions, and provide Congress with
accurate budget submissions for war reserve spare parts, we recommend
that the Secretary of Defense direct the Secretary of the Army to have
the Commander of Army Material Command take the following actions to
expand or change its current process consistent with the attributes in
this report:
* establish an overarching industrial base capability assessment
process that considers the attributes in this report;
* develop a method to efficiently collect current industrial base
capability data directly from industry itself;
* create analytical tools that identify potential production capability
problems such as those due to surge in wartime spare parts demand; and;
* create management strategies for resolving spare parts availability
problems, for example, by changing acquisition procedures or by
targeting investments in material and technology resources to reduce
production lead times.
Agency Comments and Our Evaluation:
DOD partially concurred with the overall findings and recommendations.
However, it nonconcurred with specific points in several of our
recommendations relating to the need to improve the capability of the
Army‘s approach to assessing industrial base capabilities. Our
evaluation of the Department‘s specific comments on each recommendation
follows. DOD agreed with the overall point of our first recommendation
that it establish an overarching industrial base assessment process
relying on the most accurate information available. However, it did not
concur that the Army should change its current process to be consistent
with attributes of the DLA program. It stated that the Army‘s current
system already applies many of these attributes and must have the
flexibility to do so in its own manner consistent with its specific
requirements and resources. As we reported, our analysis shows the
Army‘s program does not have all the key attributes such as collecting
current industrial base capability data from industry. Furthermore, we
considered the Army‘s need for flexibility in managing and executing
its program when developing our recommendation by stating that the Army
should be consistent with”not necessarily mirror the attributes of
DLA‘s program. Therefore, we continue to believe our recommendation is
appropriate.
DOD agreed with the underlying premise of our second recommendation
that the most accurate data lead to the most accurate estimates.
However, it stated that we provided no evidence that more current data
would result in a more accurate forecast of industry‘s capability to
provide parts for war. As pointed out in our report, DLA provided
examples of how it could save money by using current data it collected
from industry, such as over $62,000 on the centrifugal fan.
Furthermore, we noted that a study done by the Army in 1998 showed that
data collected at that time about actual industrial base capability
significantly disagreed with the Army‘s estimated industrial base
capability. The department also did not agree to a comprehensive data
collection effort because keeping more current data does not warrant
additional resources and stated that it will direct the Army examine
the feasibility of attempting to proactively collect production data
for a limited number of items. We recognized the potential for such an
initiative in our report and stated that the Army Materiel Systems
Analysis Agency believes that periodically collecting current data on
the top 100 costliest spare parts could be a reasonable approach.
Although this is a good first step, a comprehensive effort to collect
current industrial base capability data directly from industry is basic
to the recommendation‘s underlying premise and is a best practice.
Therefore we continue to believe that our recommendation has merit.
DOD concurred with the point of our third recommendation that there is a
need to identify potential production capability problems such as those
resulting from a wartime surge in demand for spare parts. However, it
did not agree that the Army does not have such a process. While the
Army‘s approach may have many analytical features, it does not provide
specific analyses of production capability. Such analyses contribute to
identifying possible production capability problems and could enhance
the Army‘s management decisions. Therefore, we continue to recommend
that the Army create such analytical tools. Furthermore, in response to
DOD‘s comment about the need to validate survey data on production
capability before taking action, we added information to our report
stating that DLA does validate its industry surveys as part of its
process.
With regard to our fourth recommendation, DOD concurred with the
concept that management strategies are needed to resolve spare parts
availability problems. But, it disagreed with the implication that the
Army has no such strategies. While the Army does have some processes at
the individual command level that identify and address spare parts
availability problems, we did not find an overarching process to create
management strategies designed to reduce lead times and inventories.
Therefore, we continue to believe that our recommendation is
appropriate.
Scope and Methodology:
To determine whether the Army is using current industrial base data for
assessing wartime spare parts industrial base capability, we interviewed
Army officials responsible for war reserve spare parts planning,
requirements development, and estimation of industrial base capability
in the Office of the Army Deputy Chief of Staff for Logistics in
Washington, District of Columbia; the Army Materiel Command in
Alexandria, Virginia; the Army Aviation and Missile Command at Redstone
Arsenal, Alabama; and the Army Materiel Systems Analysis Agency at
Aberdeen Proving Grounds, Maryland.
To determine whether opportunities exist to improve the reliability of
the Army‘s industrial base capabilities assessments, we compared the
Army‘s approach to key attributes of the DLA‘s program by interviewing
DLA officials in the Supplier Assessment and Capability Division at Fort
Belvoir, Virginia, and the Defense Supply Centers in Richmond, Virginia,
and Columbus, Ohio, that are responsible for an industrial base data
collection and analysis activity using information from private
industry to improve spare parts management. We also reviewed the
processes used by the Army and DLA to assess industrial base
capability.
We performed our review between October 2001 and May 2002 in accordance
with generally accepted government auditing standards.
We are sending copies of this report to the Secretary of Defense and the
Secretary of the Army. We will also make copies available to others upon
request. In addition, the report will be available at no charge on the
GAO Web site at [hyperlink, http://www.gao.gov].
Please contact me on (202) 512-8412 if you or your staff has any
questions concerning this report.
Signed by:
David R. Warren, Director:
Defense Management Issues:
List of Congressional Committees:
The Honorable Carl Levin:
Chairman:
The Honorable John W. Warner:
Ranking Minority Member:
Committee on Armed Services:
United States Senate:
The Honorable Daniel Inouye:
Chairman:
The Honorable Ted Stevens:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
United States Senate:
The Honorable Bob Stump:
Chairman:
The Honorable Ike Skelton:
Ranking Minority Member:
Committee on Armed Services:
House of Representatives:
The Honorable Jerry Lewis:
Chairman:
The Honorable John P. Murtha:
Ranking Minority Member:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
[End of section]
Appendix I: Defense Logistics Agency Industrial Base Planning:
The Defense Logistics Agency‘s (DLA) industrial base assessment program
operates within the Supplier Assessment and Capability Division in the
Acquisition Management and Logistics Policy Directorate. Among the
division‘s objectives are: (1) to provide information tools to assess
the capabilities of suppliers and (2) to identify potential readiness
shortfalls and mitigate them through various business practices such as
investing in long-lead materials and by taking advantage of
manufacturing commonalities.
To achieve these objectives, the division has developed a variety of
tools to assess the supplier base in each of its major product
categories”weapon systems and hardware, construction, medical supplies,
subsistence items, and clothing and textiles. Using these tools, DLA is
able to evaluate suppliers‘ capabilities to provide items in both
peacetime and wartime, to take actions to mitigate quantifiable risks,
and to examine broad industrial base issues and trends, using
statistically valid information. The tools allow assessments to be made
by individual item or grouped by items, product family, sector or
subsector, weapon system or platform, or supplier.
One of these tools, the Worldwide Web Industrial Capabilities Assessment
Program, was designed for assessing supplier resources available to the
Defense Department. The program is an automated, interactive, Web-based
program that allows the gathering of information from industrial
suppliers and the use of this data to assess the industrial sector‘s
capabilities for supplying various items. It also enables information
to be analyzed in a wide variety of formats in order to identify
strategies directed toward reducing costs and providing wartime
readiness.
Developed in 1997, the Worldwide Web Industrial Capabilities Assessment
Program replaced the old data collection process, which relied on mass
mailings of lengthy (up to 22 pages), cumbersome questionnaires that
suppliers had to fill out by hand. The response rate from industry was
typically too low to allow any statistically relevant analysis. In
addition, the narrative answers to key questions were incompatible with
computer analysis, and thus the information that industry provided
could not be acted upon.
The development of the program changed both the way information is
collected from industrial suppliers and the way that information is
used to conduct industrial base assessments and analyses.
Data Collection Tool:
The data collection tool was built specifically for industrial base
assessments. It resides on a Web site that can be easily accessed by
industry representatives. It uses an interactive survey format to
collect information directly from a company about its ability to supply
certain items. A company‘s representative checks in and fills out, or
updates, a survey questionnaire for each item or group of items that is
supplied. Depending on how a user answers a question, the questionnaire
automatically adjusts itself to remain as short as possible but still
collect the essential information that is needed for analysis. The
survey information is saved in a permanent database, which eliminates
the need for a company to reenter information when it is updated.
The program identifies each item by the supplier‘s own part number
grouped by an industry standard classification code. This simplifies
input of information for multiple items that might use the same
production line or equipment. It requests a wide range of information
about the industry‘s ability to supply an item, including high and low
estimates of production time, capacity, potential constraints and
bottlenecks, and inventory on-hand. See table 5 for a list of the data
fields.
Table 5: Program Data Fields and Descriptions:
Data field: Previous year (production data);
Description of data: The actual quantity of the item (in units)
produced during the previous calendar year.
Data field: Current year (production data);
Description of data: The actual/estimated quantity of the part produced
at the responding manufacturing site during the current calendar year.
Data field: Next year (production data);
Description of data: The projected quantity of the item (in units) to
be produced during the next calendar year.
Data field: Low estimate (production for U.S. government end use);
Description of data: Estimate the minimum amount of the portion of
current production (in percent) of the item that will be sold directly
to the U.S. government or included in some other product that is sold
to the U.S. government. If you have precise knowledge of the final use
of the surge item, the minimum and maximum estimates will be identical.
Data field: High estimate (production for U.S. government end use);
Description of data: Estimate the maximum amount of the portion of
current production (in percent) of the item that will be sold directly
to the U.S. government or included in some other product that is sold
to the U.S. government. If you have precise knowledge of the final use
of the surge item, the minimum and maximum estimates will be identical.
Data field: Constraints (surge data);
Description of data: Specify the major constraints to larger production
quantities.
Data field: First article test;
Description of data: Needed for items requiring Department of Defense
(DOD) certification. Clicking yes means your facility has been approved
by DOD to manufacture items with rigid specifications.
Data field: Technical data package;
Description of data: Clicking yes indicates you possess the technical
drawings/specifications for the item.
Data field: Current lead time;
Description of data: The current minimum time between order and
delivery of a listed part.
Data field: Priority lead time;
Description of data: The estimated time between order and delivery of a
listed part (supplied from new production, not finished inventory), if
the part were given priority treatment over all other production.
Data field: Finished inventory;
Description of data: Average inventory of finished parts under normal
operating conditions.
Data field: Production resource category;
Description of data: The survey focuses on five production resource
categories: production equipment, test equipment, tooling, skilled
labor, and materials. For each listed part, provide bottleneck and
throughput data for those categories that were identified in the
’Constraints“ section as limiting increased production of the part.
Data field: Bottleneck;
Description of data: The specific production equipment, tooling, test
equipment, labor, or material that would limit output of a part in
response to a sudden substantial increase in demand.
Data field: Maximum throughput during one hour of operation;
Description of data: The maximum units of a part that can be processed
through a specific bottleneck during one hour of operation.
Data field: Materials special definition;
Description of data: For material bottlenecks, provide the maximum
number of this part that can be produced from the average ’on hand
quantity“ of the specified bottleneck material. This answer should be
consistent with the average inventory reported for materials in the
capacity section of this tool. If Average On-Hand Inventory was
reported equal to 0, provide number of material bottleneck required to
produce one unit of the surveyed item.
Data field: Quantity of item;
Description of data: The estimated quantity of the item that can be
processed through the identified bottleneck during one hour of
utilization.
Data field: Critical resources;
Description of data: The piece of equipment that would be the first
bottleneck limiting increased output of the item. (Ignore bottlenecks
that are not the direct result of equipment constraints and ignore
competing demands for the equipment used to produce items other than
the item.)
Data field: Quantity from inventory;
Description of data: The amount of units of the item that could be
produced using only materials currently in inventory. Assume that all
applicable materials currently in inventory could be dedicated to
production of the item. In other words, ignore any conflicting material
needs for the production of other items. If the current inventory
levels are abnormally high or low, base your calculations on an average
inventory level. Include any finished quantities of the item
currently/normally held in inventory in the total.
Data field: Number of equipment/staff;
Description of data: Provide the unit count for each type of equipment,
tooling, or skilled labor category. For skilled labor, express the unit
count in terms of full-time equivalents. ’Full-time equivalent“ is the
number of hours entered in the ’Current capacity“ column. For example,
if ’Current capacity“ is a 40-hour workweek, two half-time employees
who work 20-hour workweeks should be counted as one full-time
equivalent.
Data field: Current capacity;
Description of data: The hours per week that constitute 100 percent
utilization of the listed production resource under normal operating
conditions. For skilled labor, this number should be normal weekly
hours for a full-time employee.
Data field: Capacity utilization;
Description of data: The current utilization rate (in hours per week)
of the listed production resource.
Data field: Utilization for government end use;
Description of data: The average hours per week the listed production
resource is utilized to produce items for government end use. Your
response should include both items sold directly to the U.S. government
and items included in other products sold to the U.S. government. If
you do not track final use of some or all items produced with this
production resource, provide
your ’best guess.“
Data field: Surge capacity;
Description of data: The maximum hours of operation per week
(sustainable over several months) that the listed production resource
could be utilized under emergency conditions.
Data field: Normal lead time (current lead time);
Description of data: If a customer placed an order with you today for a
quantity of the item, how many days from today would you promise
delivery (from new production, not from off-the-shelf)?
Data field: Lead time to bring new capacity on-line;
Description of data: What is the ’order-to-first production“ lead time
for the listed production resource. If you were to order/hire the
production resource today, how soon (in days) would you expect this
production resource to be operational?
Data field: Shortest lead time to bring new capacity on-line;
Description of data: What is the shortest ’order–to-first production“
lead time for the listed production resource, if your order for this
production resource were given top priority. (In other words, assume
that your order would be placed at the top of your supplier‘s delivery
queue.) If you were to order/hire the production resource today, how
soon (in days) would you
expect this production resource to be operational?
Data field: New item production;
Description of data: In response to an emergency need, the length of
time it would take to produce that item after receiving the technical
data (in days). Assumptions: (1) the item is similar in complexity to
the item addressed in your previous responses and (2) the item can be
produced using the same production equipment, test equipment, and
skilled labor currently used for production of that item.
Data field: Surge lead time;
Description of data: Given crisis planning what is your best possible
production lead time (PLT) for this item?
Data field: Facility name;
Description of data: This is the legal name for the location about
which information is being provided. Include all qualifiers such as
division and subsidiary.
Data field: Street address;
Description of data: The street address includes the post office box
number, if used, as well as a physical street address.
Data field: City;
Description of data: The city (mailing) address for the facility.
Data field: State;
Description of data: The state address for the facility. Use the
standard, two-character abbreviations for states. Use the province name
if Canadian.
Data field: Zip code;
Description of data: Nine-digit zip codes are preferred for U.S.
addresses, and 10-digit codes are preferred for Canadian addresses.
Data field: Country;
Description of data: USA or Canada.
Data field: DUNS number;
Description of data: This is a nine-character number assigned by Dun &
Bradstreet Financial Services that identifies corporate entities.
Data field: CAGE code;
Description of data: CAGE is the abbreviation for Commercial and
Government Entity. This five-character alphanumeric identifier is
assigned by the government to companies doing business with the
government. (The CAGE Code was formerly known as FSCM.)
Data field: DODAAC number;
Description of data: This is the DOD Activity Address Code for the DCMC
representative (DCMAO or DPRO). The DODAAC listing is contained in DOD
4000.25-6-M, DOD Activity Address Directory.
Data field: Name;
Description of data: Enter your name.
Data field: Job title;
Description of data: Enter your job title.
Data field: Telephone number;
Description of data: Enter your telephone number, including area code.
Enter the extension number in the extension field.
Data field: Fax number;
Description of data: Enter your fax number, including area code.
Data field: Email address;
Description of data: Enter your email address.
Data field: Company name;
Description of data: If known, include qualifiers such as divisions and
subsidiary.
Data field: Street address;
Description of data: The street address includes the post office box
number, if used, as well as a physical street address.
Data field: City;
Description of data: The city (mailing) address for the key supplier.
Data field: State;
Description of data: The state (mailing) address for the key supplier.
Use the standard two-character abbreviations for states. Use the
appropriate mailing designation instead of state if the supplier is
foreign.
Data field: Zip code;
Description of data: Nine-digit zip codes are preferred for U.S.
addresses, and ten-digit zip codes are preferred for Canadian
addresses; use the appropriate mailing designation instead of the zip
code if the supplier is foreign.
Data field: Country;
Description of data: The country where the key supplier resides.
Data field: Material name;
Description of data: Identify the material/item supplied by this
supplier.
Data field: Part number/grade of material;
Description of data: Enter a unique identifier for the material/item.
Data field: Inventory;
Description of data: Your facility‘s average inventory of the material
or pass through item.
Data field: Unit of measure;
Description of data: The standard measure of material or item quantity,
such as ’each,“ ’100-ct box,“ ’pounds,“ ’100-lb ingot,“ ’55-gal
barrel,“ etc.
Data field: Material lead time (normal);
Description of data: The current order-to-delivery lead time (days) for
this material/item.
Data field: Monthly supply (normal);
Description of data: The average monthly supply of the material or part
acquired from this vendor under normal conditions or the average
quantity ordered if ordered only on intermittent demand or
periodically.
Data field: Material lead time (surge);
Description of data: The order-to-delivery lead time (days) for this
material/item, if your supplier were required to place your order at
the top of the order queue.
Data field: Maximum monthly supply (surge);
Description of data: Your estimate of the maximum monthly supply of the
material or item that could be acquired from this vendor under
emergency conditions. Assume your order for the material or item would
be given priority treatment by your vendor.
Data field: Delete;
Description of data: Deletes the connection between the material
bottleneck or PTI and company listed on the row.
Data field: Contact name;
Description of data: Enter the name of your contact person with the
company.
Data field: E-mail address;
Description of data: Enter the contact‘s email address.
Data field: Phone number;
Description of data: Enter the contact‘s phone number.
Source: Worldwide Web Industrial Capabilities Assessment Program survey
instrument.
[End of table]
Analytical Tool:
While the data collection tool interfaces with industry via the Web to
gather data, the analytical tool, also Web-based, is a centralized tool
that is available to all approved personnel regardless of location. The
analytical tool allows analysts to assess what is needed in the way of
industrial items and what the industrial base is capable of providing.
It does this by combining the current information supplied by industry
with existing DLA legacy data (e.g., item purchase histories, and
previous item shortfalls). Analysts can use this integrated database to
examine information at various levels (e.g., individual item, family
groups, sector and subsector, weapon system and platform, or supplier)
and to graphically depict this information in a range of formats and
export the data to external files for further complex analysis. They
can create statistically valid samples of discrete data to analyze.
With this information, they are able to identify acquisition strategies
that take advantage of similar manufacturing processes and affect
changes in peacetime buying practices as a low-cost way of providing
wartime readiness.
[End of section]
Appendix II: Comments from the Department of Defense:
Deputy Under Secretary Of Defense For Logistics And Materiel Readiness:
3500 Defense Pentagon:
Washington, DC 20301-3500:
July 8, 2002:
Mr. David R. Warren:
Director, Defense Management Issues:
U.S. General Accounting Office:
441 G Street, N.W.
Washington, D.C. 20548:
Dear Mr. Warren:
This is the Department of Defense (DoD) response to the General
Accounting Office (GAO) draft report entitled, "Defense Inventory:
Improved Industrial Base Assessments for Army War Reserve Spares Could
Save Money," dated May 31, 2002 (GAO Code 350069/GAO-02-650).
The DoD comments on the draft report are enclosed.
Please contact John Becker, (703) 614-8578, of my staff if additional
information is required.
Sincerely,
Signed by:
Allen W. Beckett:
Principal Assistant:
Enclosure: As stated:
GAO Draft Report Dated May 31, 2002:
GAO Code 350069/GAO-02-650:
"Defense Inventory: Improved Industrial Base Assessments For Army War
Reserve Spare Could Save Money"
Department Of Defense Comments To The Recommendation:
Recommendation: The GAO recommended that the Secretary of Defense
direct the Secretary of the Army to have the Commander of the Army
Materiel Command take the following actions to expand or change its
current process consistent with the attributes in this report:
1. Establish an overarching industrial base capability assessment
process that considers the attributes of this report;
2. Develop a method to efficiently collect current industrial base
capability data directly from industry itself;
3. Create analytical tools that identify potential production
capability problems such as those due to surge in wartime spare parts
demand; and;
4. Create management strategies for resolving spare parts availability
problems, for example, by changing acquisition procedures or by
targeting investments in material and technology resources to reduce
production lead times.
DOD Response: Overall, we concur with GAO finding that the Army's
approach for assessing wartime spare parts base capabilities does not
rely on current data from industry to the maximum extent possible. And,
while it is intuitively appealing to think that more current data would
result in more accurate forecasts, there is no evidence in the report
that this would be the case. Further, monetary savings may be achieved
by deferring expenditures, as described in the draft, based on shorter
lead times reported by suppliers. However, for critical war reserve
spares, such actions should not be taken until supplier-related lead
times are verified; the Defense Logistics Agency (DLA) system cited as
an example may include this step, but it was not apparent from the
report.
DOD Response 1: Partially concur. The Office of the Secretary of
Defense (OSD) agrees with the need to have an overarching industrial
base assessment process, analytical tools to identify potential
production capability problems, and management strategies for resolving
spare parts availability problems. We further agree that such a process
should rely on the most accurate information available. We nonconcur
with the GAO recommendation that the Army Materiel Command (AMC) change
its current process to be consistent with the attributes of the DLA
program, as described in the GAO report. We agree with Army claim that
their processes already apply many of the attributes addressed in this
GAO report and that, while there are differences between the two
approaches, Army and DLA must have the flexibility to manage and
execute their War Reserve and Industrial Base Programs in a manner
consistent with their specific requirements and resources. Army and DLA
should continue to share information so each can obtain leverage from
the efforts of the other. Army has in fact developed an automated
web-based tool, the IB Hub, to facilitate industrial base analysis.
Because this initiative was too early in its infancy, when GAO was
working on the earlier report, Defense Inventories: Army War Reserve
Spare Parts Requirements Are Uncertain (GAO-01-425, Washington, D.C.,
May 10, 2001), the Army chose not to discuss this tool with GAO at the
time. Subsequently, when GAO was working on the current report, the
Army did brief GAO on its web-based efforts. The IB Hub utilizes many
of the same data elements that GAO lists in their report.
DOD Response 2: Partially concur. We concur with the underlying premise
that the most accurate data leads to the most accurate estimates. The
GAO report references the Army's experience with a volunteer system for
collecting data, which resulted in data of poor quality. While the data
collected from suppliers via the internet may be more current, there is
no reason to believe the resultant data will be any more accurate and
thus, we are surprised to see GAO recommending such a system. The Army
developed the IB Hub system specifically to overcome the problem
associated with collecting data directly from industry by integrating
available and relevant data from multiple sources. In developing the I-
tub, Army included a mechanism for collecting industrial base
production data in a web-based form directly from industry. However,
Army did not follow up by starting a comprehensive collection effort
because of concerns over voluntary industry participation, validity of
data, the perishable nature of the data, and the potential resources to
maintain decision quality data. Army populates the IB Hub with
production data on a case-by-case basis as data become available. Given
that the War Reserve processes use estimates to look seven-years into
the future, a planning estimate for industrial base production does not
warrant the additional resources that would be required to keep more
data more current. OSD will direct the Army to examine the feasibility
of attempting to pro-actively collect production data for a limited
number of items that represent the greatest risk to the Army.
DOD Response 3: Partially concur. We concur with the need to identify
potential production capability problems such as those due to surge in
wartime spare parts demand. However, we noncur with the GAO assertion
that the Army does not have such a process. Even though the war reserve
requirements are based on looking out seven-years into the future to
the end of the Program Objectives Memorandum (POM), the IB Hub does
have visibility into current logistics and procurement data, including
war reserve requirements, as well as current financial data for
producers. While this look does not provide specific production
capability, it does help establish a level of risk from which the Army
can make decisions whether more detailed data is needed.
DOD Response 4: Partially concur. We agree with the need to have
management strategies for resolving spare parts availability problems.
We nonconcur with the GAO report assertion that the Army does not have
such strategies. The Army has processes separate from the requirements
determination discussed in the report to manage and execute the War
Reserve Program.
[End of section]
Appendix III: Staff Acknowledgments:
Acknowledgments:
Key contributors to this report were Richard Payne, Paul Gvoth, Leslie
Gregor, Douglas Mills, and Nancy Benco.
[End of section]
Footnotes:
[1] This work was undertaken in response to a mandate in section 364 of
the National Defense Authorization Act for Fiscal Year 2000, which
resulted in the report Defense Inventory: Army War Reserve Spare Parts
Requirements Are Uncertain, GAO-01-425 (Washington, D.C.: May 10,
2001).
[2] The industrial base includes both privately owned and government-
owned assets. In this report, we use the term industrial base to refer
only to private industry and commercial sources.
[3] War reserves are stocks of materiel amassed during peacetime to
meet increased military requirements following the outbreak of war. The
reserves are intended to provide the Army with interim support to
sustain its operations until the Army can be resupplied with materiel
from the industrial base.
[4] DOD Directive 3110.6, War Reserve Materiel Policy, November 9,
2000.
[5] DOD 4140.1-R, DOD Materiel Management Regulation, May 1998.
[6] This requirement comes from the Army‘s 2001 Industrial Base
Strategy and its Stationing Strategy.
[7] The Army uses the term industrial base offset to mean its estimate
of what private industry can be expected to provide during wartime.
[8] We did not attempt to verify the validity of the requirements
estimates.
[9] DOD Form 2737, Industrial Capabilities Questionnaire.
[10] Administrative lead time is defined as the interval between
initiation of procurement action and letting of contract or placing of
order. Production lead time is defined as the time interval between the
placement of a contract and receipt into the supply system of materiel
purchased.
[11] This document, an engineering change request (XLGWRA13713), dated
December 15, 1999, proposes changes to this estimating method.
[12] The Industrial Base Hub is composed of three components:
Industrial Base Automated Rating System, Industrial Base Activity
System, and Industrial Base Information System.
[13] DLA calculated the savings based on the number of units that would
not need to be purchased for war reserves multiplied by the cost per
unit.
[End of section]
GAO‘s Mission:
The General Accounting Office, the investigative arm of Congress,
exists to support Congress in meeting its constitutional
responsibilities and to help improve the performance and accountability
of the federal government for the American people. GAO examines the use
of public funds; evaluates federal programs and policies; and provides
analyses, recommendations, and other assistance to help Congress make
informed oversight, policy, and funding decisions. GAO‘s commitment to
good government is reflected in its core values of accountability,
integrity, and reliability.
Obtaining Copies of GAO Reports and Testimony:
The fastest and easiest way to obtain copies of GAO documents at no
cost is through the Internet. GAO‘s Web site [hyperlink,
http://www.gao.gov] contains abstracts and fulltext files of current
reports and testimony and an expanding archive of older products. The
Web site features a search engine to help you locate documents using
key words and phrases. You can print these documents in their entirety,
including charts and other graphics.
Each day, GAO issues a list of newly released reports, testimony, and
correspondence. GAO posts this list, known as ’Today‘s Reports,“ on its
Web site daily. The list contains links to the full-text document
files. To have GAO e-mail this list to you every afternoon, go to
[hyperlink, http://www.gao.gov] and select ’Subscribe to daily E-mail
alert for newly released products“ under the GAO Reports heading.
Order by Mail or Phone:
The first copy of each printed report is free. Additional copies are $2
each. A check or money order should be made out to the Superintendent
of Documents. GAO also accepts VISA and Mastercard. Orders for 100 or
more copies mailed to a single address are discounted 25 percent.
Orders should be sent to:
U.S. General Accounting Office:
441 G Street NW, Room LM:
Washington, D.C. 20548:
To order by Phone:
Voice: (202) 512-6000:
TDD: (202) 512-2537:
Fax: (202) 512-6061:
To Report Fraud, Waste, and Abuse in Federal Programs Contact:
Web site: [hyperlink, http://www.gao.gov/fraudnet/fraudnet.htm]:
E-mail: fraudnet@gao.gov:
Automated answering system: (800) 424-5454 or (202) 512-7470:
Public Affairs:
Jeff Nelligan, managing director, NelliganJ@gao.gov:
(202) 512-4800:
U.S. General Accounting Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548:
