Depot Maintenance
Improved Strategic Planning Needed to Ensure That Army and Marine Corps Depots Can Meet Future Maintenance Requirements Gao ID: GAO-09-865 September 17, 2009The Army and Marine Corps maintenance depots provide critical support to ongoing military operations in Iraq and Afghanistan and are heavily involved in efforts to reset the force. The Department of Defense (DOD) has an interest in ensuring that the depots remain operationally effective, efficient, and capable of meeting future maintenance requirements. In 2008, in response to direction by the Office of the Secretary of Defense (OSD), the Army and the Marine Corps each submitted a depot maintenance strategic plan. Our objective was to evaluate the extent to which these plans provide comprehensive strategies for meeting future depot maintenance requirements. GAO determined whether the plans were consistent with the criteria for developing a results-oriented management framework and fully addressed OSD's criteria.
The depot maintenance strategic plans developed by the Army and Marine Corps identify key issues affecting the depots, but do not provide assurance that the depots will be postured and resourced to meet future maintenance requirements because they do not fully address all of the elements required for a comprehensive, results-oriented management framework. Nor are they fully responsive to OSD's direction for developing the plans. While the services' strategic plans contain mission statements, along with long-term goals and objectives, they do not fully address all the elements needed for sound strategic planning, such as external factors that may affect how goals and objectives will be accomplished, performance indicators or metrics that measure outcomes and gauge progress, and resources required to meet the goals and objectives. Also, the plans partially address four issues that OSD directed the services, at a minimum, to include in their plans, such as logistics transformation, core logistics capability assurance, workforce revitalization, and capital investment. Army and Marine Corps officials involved with the development of the service strategic plans acknowledged that their plans do not fully address the OSD criteria, but they stated that the plans nevertheless address issues they believe are critical to maintaining effective, long-term depot maintenance capabilities. The Army's and Marine Corps' plans also are not comprehensive because they do not provide strategies for mitigating and reducing uncertainties in future workloads that affect the depots' ability to plan for meeting future maintenance requirements. Such uncertainties stem primarily from a lack of information on (1) workload that will replace current work on existing systems, which is expected to decline, and (2) workload associated with new systems that are in the acquisition pipeline. According to depot officials, to effectively plan for future maintenance requirements, the depots need timely and reliable information from their major commands on both the amounts and types of workloads they should expect to receive in future years. Depot officials told us that the information they receive from their major commands on their future workloads are uncertain beyond the current fiscal year. Officials cited various factors that contribute to these uncertainties, such as volatility in workload requirements, changing wartime environment, budget instability, and unanticipated changes in customer orders. In addition, depot officials said that they are not involved in the sustainment portion of the life cycle management planning process for new and modified systems. No clear process exists that would enable them to have input into weapon system program managers' decisions on how and where new and modified systems will be supported and maintained in the future. Unless they are integrated in this planning process, these officials said, the depots will continue to have uncertainties about what capabilities they will need to plan for future workloads and what other resources they will need to support new and modified weapon systems.
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-09-865, Depot Maintenance: Improved Strategic Planning Needed to Ensure That Army and Marine Corps Depots Can Meet Future Maintenance Requirements
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Report to Subcommittee on Readiness, Committee on Armed Services, House
of Representatives:
United States Government Accountability Office:
GAO:
September 2009:
Depot Maintenance:
Improved Strategic Planning Needed to Ensure That Army and Marine Corps
Depots Can Meet Future Maintenance Requirements:
GAO-09-865:
GAO Highlights:
Highlights of GAO-09-865, a report to the Subcommittee on Readiness,
Committee on Armed Services, House of Representatives.
Why GAO Did This Study:
The Army and Marine Corps maintenance depots provide critical support
to ongoing military operations in Iraq and Afghanistan and are heavily
involved in efforts to reset the force. The Department of Defense (DOD)
has an interest in ensuring that the depots remain operationally
effective, efficient, and capable of meeting future maintenance
requirements. In 2008, in response to direction by the Office of the
Secretary of Defense (OSD), the Army and the Marine Corps each
submitted a depot maintenance strategic plan. Our objective was to
evaluate the extent to which these plans provide comprehensive
strategies for meeting future depot maintenance requirements. GAO
determined whether the plans were consistent with the criteria for
developing a results-oriented management framework and fully addressed
OSD‘s criteria.
What GAO Found:
The depot maintenance strategic plans developed by the Army and Marine
Corps identify key issues affecting the depots, but do not provide
assurance that the depots will be postured and resourced to meet future
maintenance requirements because they do not fully address all of the
elements required for a comprehensive, results-oriented management
framework. Nor are they fully responsive to OSD‘s direction for
developing the plans. While the services‘ strategic plans contain
mission statements, along with long-term goals and objectives, they do
not fully address all the elements needed for sound strategic planning,
such as external factors that may affect how goals and objectives will
be accomplished, performance indicators or metrics that measure
outcomes and gauge progress, and resources required to meet the goals
and objectives. Also, the plans partially address four issues that OSD
directed the services, at a minimum, to include in their plans, such as
logistics transformation, core logistics capability assurance,
workforce revitalization, and capital investment. Army and Marine Corps
officials involved with the development of the service strategic plans
acknowledged that their plans do not fully address the OSD criteria,
but they stated that the plans nevertheless address issues they believe
are critical to maintaining effective, long-term depot maintenance
capabilities.
The Army‘s and Marine Corps‘ plans also are not comprehensive because
they do not provide strategies for mitigating and reducing
uncertainties in future workloads that affect the depots‘ ability to
plan for meeting future maintenance requirements. Such uncertainties
stem primarily from a lack of information on (1) workload that will
replace current work on existing systems, which is expected to decline,
and (2) workload associated with new systems that are in the
acquisition pipeline. According to depot officials, to effectively plan
for future maintenance requirements, the depots need timely and
reliable information from their major commands on both the amounts and
types of workloads they should expect to receive in future years. Depot
officials told us that the information they receive from their major
commands on their future workloads are uncertain beyond the current
fiscal year. Officials cited various factors that contribute to these
uncertainties, such as volatility in workload requirements, changing
wartime environment, budget instability, and unanticipated changes in
customer orders.
In addition, depot officials said that they are not involved in the
sustainment portion of the life cycle management planning process for
new and modified systems. No clear process exists that would enable
them to have input into weapon system program managers‘ decisions on
how and where new and modified systems will be supported and maintained
in the future. Unless they are integrated in this planning process,
these officials said, the depots will continue to have uncertainties
about what capabilities they will need to plan for future workloads and
what other resources they will need to support new and modified weapon
systems.
What GAO Recommends:
GAO is recommending that DOD direct the Army and Marine Corps to update
their plans to ensure that they provide a comprehensive results-
oriented management framework, fully address the criteria established
by OSD, and mitigate and reduce uncertainties in future workload. In
its written comments on a draft of this report, DOD concurred with GAO‘
s recommendations.
View [hyperlink, http://www.gao.gov/products/GAO-09-865] or key
components. For more information, contact William M. Solis at (202) 512-
8365 or solisw@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Strategic Plans Lack Elements Needed to Position the Depots to Meet
Future Maintenance Requirements:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Scope and Methodology:
Appendix II: Army and Marine Corps Depot Actions to Improve
Productivity:
Appendix III: Trends in Army and Marine Corps Depot Workforce Levels:
Appendix IV: Comments from the Department of Defense:
Appendix V: GAO Contact and Staff Acknowledgments:
Tables:
Table 1: Army and Marine Corps Depots and Principal Work Performed:
Table 2: Assessment of Results-Oriented Management Planning Elements
within the Army and Marine Corps Depot Maintenance Strategic Plans:
Table 3: Assessment of OSD-Identified Issues within the Army and Marine
Corps Depot Maintenance Strategic Plans:
Table 4: Results of Selected Army Depots' Process Improvements, Fiscal
Years 2004 through 2007:
Table 5: Results of Selected Marine Corps Depots' Process Improvements,
Fiscal Years 2004 through 2007:
Figures:
Figure 1: Army Depots' Workforce by Category, Fiscal Years 1999 to
2008:
Figure 2: Marine Corps Depots' Workforce by Category, Fiscal Years 1999
to 2008:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
September 17, 2009:
The Honorable Solomon Ortiz:
Chairman:
The Honorable J. Randy Forbes:
Ranking Member:
Subcommittee on Readiness:
Committee on Armed Services:
House of Representatives:
Army and Marine Corps maintenance depots support combat readiness by
providing repair and manufacturing capability that is needed to keep
weapon systems and other equipment in good working order. The depots
have provided critical support to ongoing military operations and are
heavily involved in efforts to reset the force.[Footnote 1] The organic
maintenance capability provided by the depots also helps to fulfill
requirements under Title 10 of the U.S. Code, which directs the
Department of Defense (DOD) to maintain a core logistics capability and
limit the percentage of annual funding that may be used for depot
maintenance performed by contractors.[Footnote 2] Given the important
role of the depots in sustaining a ready force and fulfilling Title 10
requirements, DOD has an interest in ensuring that the depots remain
operationally effective, efficient, and capable of meeting future
maintenance requirements. At the same time, DOD has been relying on
contractors to support many of its weapons systems and, in 2001,
identified performance-based logistics as its preferred support
strategy.[Footnote 3] Prior to the onset of military operations in Iraq
and Afghanistan, DOD's increased reliance on the private sector for
depot maintenance support--coupled with declining budgets, downsizing,
and consolidations as a result of previous Base Realignment and Closure
Act (BRAC) decisions--had led to a decline in depot-level maintenance
workloads and contributed to the general deterioration of capabilities
at military depots. The depots subsequently experienced a surge in
workload as a result of operations in Iraq and Afghanistan. For
example, they installed protective armor for trucks and repaired battle-
damaged equipment.
In response to direction from the Office of the Secretary of Defense
(OSD),[Footnote 4] both the Army and the Marine Corps developed depot
maintenance strategic plans for their military depots and, in 2008,
submitted them for review to DOD. The intent of these strategic plans,
according to the OSD criteria, is to ensure the depots are postured and
resourced to meet future requirements. Our objective was to evaluate
the extent to which their plans provide a comprehensive strategy for
meeting future depot maintenance requirements. In addition, we obtained
information on depot productivity improvements (see appendix II) and on
workforce trends between fiscal years 1999 and 2008 (see appendix III).
This report is one in a series of reviews focusing on DOD's logistics
and maintenance operations. In April 2008, we briefed your office on
the preliminary results of our work on the military departments' depot
capital investments. In July 2008, we reported on the increased
carryover work occurring at the five Army depots.[Footnote 5] In
December 2008, we reported on the implementation and impact of
performance-based logistics arrangements on weapon system support
costs.[Footnote 6] In May 2009, we reported on DOD's efforts to
establish the required core capability for fielded, new, and modified
systems.[Footnote 7]
In conducting our work, we analyzed the services' depot maintenance
strategic plans to determine if they were consistent with criteria for
developing a comprehensive results-oriented management framework and
addressed OSD's criteria for developing a strategic plan. We discussed
these plans with officials from the Army, the Marine Corps, and the
Office of the Under Secretary of Defense for Logistics and Materiel
Readiness. To gain further perspective on the plans and related issues
that affect the depots' posture for meeting future maintenance
requirements, we visited the Army's five maintenance depots (Anniston,
Corpus Christi, Letterkenny, Red River, and Tobyhanna) and both of the
Marine Corps' maintenance depots (Albany and Barstow). We also obtained
data on the depots' workload and workforce trends, as well as
information on actions aimed at improving depot productivity. Although
each of the military services was required to submit its depot
maintenance strategic plan to OSD, we decided to focus our initial work
on the Army's and Marine Corps' plans because of these services'
significant role in supporting overseas contingency operations in Iraq
and Afghanistan. As agreed with your offices, we plan to report
separately on the Air Force and Navy depot maintenance strategic plans.
We conducted this performance audit from August 2007 through September
2009 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives. A more
detailed description of our scope and methodology is included in
appendix I.
Results in Brief:
The depot maintenance strategic plans developed by the Army and Marine
Corps identify key issues affecting the depots, but do not provide
assurance that the depots will be postured and resourced to meet future
maintenance requirements because they do not fully address all of the
elements required for a comprehensive, results-oriented management
framework. Nor are they fully responsive to OSD's direction for
developing the plans. Specifically, while the services' strategic plans
contain mission statements, along with long-term goals and objectives,
they do not fully address all the elements needed for sound strategic
planning, such as external factors that may affect how goals and
objectives will be accomplished, performance indicators or metrics that
measure outcomes and gauge progress, and resources required to meet the
goals and objectives. Also, the plans partially address four issues
that OSD directed the services, at a minimum, to include in their
plans--logistics transformation, core logistics capability assurance,
workforce revitalization, and capital investment. For example, the
plans do not provide clear time frames or actions for addressing these
issues. Army and Marine Corps officials involved with the development
of the service strategic plans acknowledged that their plans do not
fully address the OSD criteria, but they stated that the plans
nevertheless address issues they believe are critical to maintaining
effective, long-term depot maintenance capabilities. OSD has decided to
wait until completion of the Quadrennial Defense Review in 2010 before
asking the services to modify or update their strategies. Additionally,
we found that the Army's and Marine Corps' plans are not comprehensive
because they do not provide strategies for mitigating and reducing
uncertainties in future workloads that affect the depots' ability to
plan for meeting future maintenance requirements. Such uncertainties
stem primarily from a lack of information on (1) workload that will
replace current work on existing systems, which is expected to decline,
and (2) workload associated with new systems that are in the
acquisition pipeline. According to depot officials, to effectively plan
for future maintenance requirements and acquire the necessary
capabilities (including workforce skills, equipment, and
infrastructure), the depots need timely and reliable information from
their major commands on both the amounts and types of workloads they
should expect to receive in future years. Depot officials told us,
however, that the information they receive from their major commands on
their future workloads is uncertain beyond the current fiscal year.
Officials cited various factors that contribute to these uncertainties,
such as the volatility in workload requirements: changing wartime
environment; budget instability, including the timing of and heavy
reliance on supplemental funding; and unanticipated changes in customer
orders. In addition, depot officials said that they are not involved in
the sustainment portion of the life cycle management planning process
for new and modified systems. Depot officials also said that no clear
process exists that would enable them to have input into weapon system
program managers' decisions on how and where new and modified systems
will be supported and maintained in the future. These decisions
profoundly affect the depots' future workload plans. Unless the depots
are integrated in the life cycle planning process, these officials
said, the depots will continue to have uncertainties about what
capabilities they will need to plan for future workloads and what other
resources they will need to support new and modified weapon systems. As
a result of these deficiencies in their strategic plans, the Army and
Marine Corps may lack assurance that their depots are postured and
resourced to meet future maintenance requirements.
We are recommending that the Army and Marine Corps update their depot
maintenance strategic plans to ensure that they (1) fully address all
elements needed for a comprehensive results-oriented management
framework; (2) fully address the four specific issues OSD directed the
services to include in their plans; and (3) include goals and
objectives aimed at mitigating and reducing future workload
uncertainties, and integrate the depots' input into the sustainment
portion of the life cycle management planning process. In its written
comments on a draft of this report, DOD concurred with all three of our
recommendations.
Background:
The Army and Marine Corps maintain organic depot maintenance
capabilities that are designed to retain, at a minimum, a ready,
controlled source of technical competence and resources to meet
military requirements. In fiscal year 2008, DOD budgeted about $5.6
billion for the five Army and two Marine Corps maintenance depots and
maintained a workforce of about 26,000 personnel at these facilities
[Footnote 8]. Depot-level maintenance and repair involves materiel
maintenance or repair requiring the overhaul, upgrading or rebuilding
of parts assemblies and subassemblies, and testing and reclamation of
equipment as necessary, regardless of the source of funds for the
maintenance or repair or the location at which the maintenance or
repair is performed.[Footnote 9] Army and Marine Corps depots work on a
wide range of weapon systems and military equipment, such as combat
vehicles, aircraft, and communications and electronics equipment. Each
of the services' depot-level activities has been designated as a Center
for Industrial and Technical Excellence in the recognized core
competency of the designee, pursuant to Section 2474 of Title 10, U.S
Code. Table 1 describes the principal work performed at each Army and
Marine Corps depot.
Table 1: Army and Marine Corps Depots and Principal Work Performed:
Army depot: Anniston; Location: Anniston, Alabama; Principal work:
Wheeled and tracked vehicles such as the M88 and M1 tank and
components.
Army depot: Corpus Christi;
Location: Corpus Christi, Texas;
Principal work: Rotary wing aircraft such as the AH-64 Apache, CH-47
Chinook, and UH-60 Blackhawk.
Army depot: Letterkenny;
Location: Chambersburg, Pennsylvania;
Principal work: Air defense and tactical missiles such as the Patriot,
Hawk, Avenger, Multiple Launch Rocket System, and Sidewinder, as well
as mobile electric power generation equipment.
Army depot: Red River;
Location: Texarkana, Texas;
Principal work: Bradley Fighting Vehicle, tactical wheeled vehicles,
Patriot Missile Recertification, rubber products, Multiple Launch
Rocket System, and the Small Replacement Excavator.
Army depot: Tobyhanna;
Location: Tobyhanna, Pennsylvania;
Principal work: Command, control, communications, computers,
intelligence, surveillance, and reconnaissance systems, as well as
electronics, avionics, and missile guidance and control systems.
Marine Corps depot: Albany;
Location: Albany, Georgia;
Principal work: Military ordnance, secondary components, engineering,
electronic, and communications equipment, custom armor kits, and major
end items such as the Assault Amphibious Vehicle, Light Vehicle System,
and High Mobility Multipurpose Wheeled Vehicle.
Marine Corps depot: Barstow;
Location: Barstow, California;
Principal work: Radar systems, heavy mobility equipment, communications
systems, diesel engines, wheeled and tracked vehicles, and weapon
systems such as the Light Armored Vehicle, Hercules Armed Recovery
Vehicle, Logistics Vehicle system, and a variety of components and
subassemblies.
Source: GAO analysis of Army's and Marine Corps' depot locations and
principal work.
[End of table]
During the late 1980s and the late 1990s, Army and Marine Corps
maintenance depots--like other DOD depots--were significantly downsized
as a result of reductions in the armed forces and DOD's decision to
outsource many logistics activities, including depot maintenance, to
the private sector. These downsizing efforts contributed to decreased
workloads at the depots and diminished their capability, reliability,
and cost effectiveness for supporting requirements for legacy systems;
it also reduced their opportunities to acquire work for new and
modified weapon systems. The downsizing also affected the depots'
ability to obtain investments in facilities, equipment, and human
capital to support their long-term viability and to ensure that they
remained a key resource for repair of new and modified systems. As a
result, DOD's depots had become facilities that primarily repaired
aging weapon systems and equipment. In 2003, Army and Marine Corps
depots experienced an increase in workload, stemming from overseas
contingency operations in Iraq and Afghanistan. Contributing to this
increase were efforts to reset systems such as the High Mobility
Multipurpose Wheeled Vehicle, the M1 Abrams Tank, and the Bradley
Fighting Vehicle, as well as work related to armor fabrication and the
armoring of systems such as the Medium Tactical Vehicle Replacement.
Despite the increase in workload, the Army and Marine Corps lacked
direction from DOD on a department wide strategic depot plan that
clarified the future role of the military depots. We reported in April
2003 that the services and DOD had not implemented comprehensive
strategic plans for defense maintenance to revitalize or protect the
future viability of their depot facilities, equipment, and workers.
[Footnote 10] In that report, we recommended that the services develop
depot strategic plans that are linked to the services' missions and
objectives, and that DOD develop a strategic plan that provides
guidance and a schedule for identifying long-term capabilities to be
provided in government-owned and -operated plants.
The House Armed Services Committee has previously encouraged DOD to
develop a comprehensive strategy to ensure that the depots are viably
positioned, and that they have the workforce, equipment, and facilities
they need to maintain efficient operations to meet the nation's current
and future requirements.[Footnote 11] In March 2007, the Under
Secretary of Defense for Acquisition, Technology, and Logistics
approved the DOD Depot Maintenance Strategy and Implementation Plans,
which articulated OSD's strategy and plans for ensuring that the
department's organic depot maintenance infrastructure is postured and
resourced to meet the national security and management challenges of
the 21st century. The plan also specified that each military service
was responsible for conducting strategic planning for depot maintenance
that focused on achieving DOD's strategy. OSD required the services to
submit the results of their strategic plans no later than 6 months
after the publication of DOD's plan. In March 2007, the Deputy Under
Secretary of Defense for Logistics and Materiel Readiness modified this
requirement to have each service submit either its published depot
maintenance strategic plan, or a report describing the process being
used to develop its strategic plan, and a target date for completing
the plan by September 1, 2007. The Army and Marine Corps finalized and
submitted their strategic plans to OSD in 2008.[Footnote 12] In
addition, the Army developed an implementation plan to accompany its
strategic plan. The Marine Corps did not produce an implementation
plan.
Strategic Plans Lack Elements Needed to Position the Depots to Meet
Future Maintenance Requirements:
While the depot maintenance strategic plans developed by the Army and
the Marine Corps identify key issues affecting the depots, they do not
fully address all of the elements required to achieve a results-
oriented management framework, and they are not fully responsive to
OSD's direction to the services for developing their plans.
Furthermore, these plans do not address uncertainties in workload that
affect the depots' ability to plan for meeting future maintenance
requirements. Finally, they do not show whether and how the depots will
have a role in planning for the sustainment of new and modified weapon
systems. As a result of these deficiencies in their strategic plans,
the Army and Marine Corps may lack assurance that their depots are
postured and resourced to meet future maintenance requirements.
Strategic Maintenance Plans Do Not Fully Address All the Elements That
Are Needed for a Results-Oriented Management Framework:
The Army's and the Marine Corps' depot maintenance strategic plans do
not fully address all of the elements that are needed for a
comprehensive results-oriented management framework. In addition, the
plans are not fully responsive to OSD's direction to the services for
developing these plans. Our prior work has shown that organizations
need sound strategic management planning in order to identify and
achieve long-range goals and objectives. We have identified critical
elements that should be incorporated in strategic plans to establish a
comprehensive, results-oriented management framework.[Footnote 13] A
results-oriented management framework provides an approach whereby
program effectiveness is measured in terms of outcomes or impact,
rather than outputs, such as activities and processes. The framework
includes critical elements such as a comprehensive mission statement,
long-term goals and objectives, approaches for accomplishing goals and
objectives, stakeholder involvement, external factors that may affect
how goals and objectives will be accomplished, performance goals that
are objective, quantifiable, and measurable, resources needed to meet
performance goals, performance indicators or metrics that measure
outcomes and gauge progress, and an evaluation plan that monitors the
goals and objectives. OSD also directed the services to include many of
the elements in their depot maintenance strategic plans. Specifically,
the OSD criteria stated that each military service's plan should
include a comprehensive mission statement, general goals and objectives
(including outcome-related goals and objectives), a description of how
the goals and objectives are to be achieved, metrics that will be
applied to gauge progress, key factors external to the respective
service and beyond its control that could significantly affect the
achievement of their general goals and objectives, and descriptions of
the program evaluations used in establishing, monitoring, or revising
goals and objectives, with a schedule for future program evaluations.
Furthermore, OSD directed the services to address a number of specific
issues in their strategic plans, including logistics transformation,
core logistics capability assurance, workforce revitalization, and
capital investment. OSD wanted the services, at a minimum, to address
these four issues because it believed they were critical to ensuring
the depots would be postured and resourced to meet future requirements.
Based on our evaluation of the Army's and Marine Corps' depot
maintenance strategic plans, we found that the plans partially address
the elements for a results-oriented management framework. While the
services' strategic plans address key issues affecting the depots and
contain mission statements, along with long-term goals and objectives,
they do not fully address all the elements needed for sound strategic
planning. Elements not fully addressed in the strategic plans are:
* Approaches for accomplishing goals and objectives;
* Stakeholder involvement in developing the plan;
* External factors that may affect how goals and objectives will be
accomplished;
* Performance goals that are objective, quantifiable, and measurable;
* Resources required to meet performance goals;
* Performance indicators or metrics that measure outcomes and gauge
progress of the goals and objectives; and:
* An evaluation plan that monitors the goals and objectives.
Table 2 summarizes, based on our evaluation, the extent to which the
Army and Marine Corps depot maintenance strategic plans address the
strategic planning elements needed for a comprehensive results-oriented
management framework.
Table 2: Assessment of Results-Oriented Management Planning Elements
within the Army and Marine Corps Depot Maintenance Strategic Plans:
Results-oriented management framework planning element: Comprehensive
mission statement;
Army plan: Addressed: The plan contains a mission statement that
defines the Army's role and responsibility to support the Depot
Maintenance Enterprise by providing resources, skills, and capabilities
to sustain life cycle readiness of the warfighter's weapon systems and
equipment worldwide in a reliable and efficient manner;
Marine Corps plan: Addressed: The plan contains a mission statement
that says the Marine Corps mission is to maintain optimum depot level
capability required to ensure readiness in peacetime, sustainment in
wartime, and reset after conflict or contingency.
Results-oriented management framework planning element: Long-term goals
and objectives;
Army plan: Addressed: The plan identifies three primary goals and nine
objectives that will be used to support the Army's Depot Maintenance
Enterprise. For example, one of the long-term goals and objective is to
use the Army Force Generation to drive depot maintenance operations and
update policies and regulations governing depot maintenance priorities
as required to support the transforming Army;
Marine Corps plan: Addressed: The plan identifies four major goals
including, aligning maintenance operation metrics with warfighter
outcomes, identifying and sustaining requisite core maintenance
capability, sustaining a highly mission capable, mission-ready
maintenance workforce, and ensuring an adequate infrastructure to
execute assigned maintenance workload. There is also a list of
objectives that are aligned with each major goal.
Results-oriented management framework planning element: Approaches for
accomplishing goals and objectives;
Army plan: Partially addressed: For example, the plan contains Army-
wide actions that the service is undertaking for each of the strategic
goals, but it does not fully describe the operational processes, skills
and technology, human capital information, a schedule for significant
actions, and other resources required to meet the goals and objectives;
Marine Corps plan: Partially addressed: For example, the plan provides
statements on what the Marine Corps plans to do for each goal, but it
does not contain specifics on how the service plans to carryout these
plans or time frames for completing the actions.
Results-oriented management framework planning element: Stakeholder
involvement in developing the plan;
Army plan: Partially addressed: For example, while the plan identifies
individual stakeholders, it does not discuss their involvement in the
planning process;
Marine Corps plan: Partially addressed: For example, while the plan
identifies individual stakeholders, it does not discuss their
involvement in the planning process.
Results-oriented management framework planning element: External
factors that may affect how goals and objectives will be accomplished;
Army plan: Partially addressed: For example, the plan refers to
factors, such as the Quadrennial Defense Review, that could affect the
achievement of the general goals and objectives and the need to update
the plan. It does not address those external factors that contribute to
the loss of legacy work, or the lack of new work the depots are not
receiving as a result of not having capability and infrastructure
improvements;
Marine Corps plan: Partially addressed: For example, the plan does
address changes in force structure, the introduction of new weapon
systems and modifications to legacy systems, but the plan does not
address factors such as sustaining sufficient depot workload for the
depots when current workloads decline.
Results-oriented management framework planning element: Performance
goals that are objective, quantifiable, and measurable;
Army plan: Partially addressed: For example, the plan has stated goals
but does not show how outcomes will be measured;
Marine Corps plan: Partially addressed: For example, the plan has
stated goals, but do not contain any means to measure outcomes.
Results-oriented management framework planning element: Resources
needed to meet performance goals;
Army plan: Partially addressed: For example, the plan and action plan
references the Army Materiel Command Human Capital Plan for workforce
needed for the depots. But it does not contain specifics on how the
Army intends to carry out these actions or time frames for completing
the actions and the human capital plan does not specify time frames for
completing the human capital plan;
Marine Corps plan: Partially addressed: For example, the plan does
address the need for sustaining a highly capable, mission-ready
maintenance workforce. However, the plan does not contain specifics on
how the service will carry out these actions or time frames to address
these areas.
Results-oriented management framework planning element: Performance
indicators or metrics that measure outcomes and gauge progress of the
goals and objectives;
Army plan: Partially addressed: For example, the plan contains some
metrics that are being used to measure the performance of a specific
goal or objective. However, it does not contain all the metrics that
provide a measure for determining how well each of the actions is
helping to meet the goals and objectives;
Marine Corps plan: Partially addressed: For example, the plan contains
metrics for two of the goals including what will be used for measuring
each objective. However, it does not specify how often they will
measure or how and when they will report the results.
Results-oriented management framework planning element: Evaluation plan
that monitors the goals and objectives;
Army plan: Partially addressed: For example, the plan contains some
planned monitoring, but it does not provide a schedule for future
program evaluations;
Marine Corps plan: Partially addressed: For example, the plan contains
some planned monitoring. However, it does not provide a schedule for
future program evaluations.
Source: GAO analysis of Army and Marine Corps depot maintenance
strategic plans.
[End of table]
The Army's and Marine Corps' depot maintenance strategic plans
partially address logistics transformation, core logistics capability
assurance, workforce revitalization, and capital investment--the four
issues that OSD directed each service, at a minimum, to include in
their plans. Table 3 summarizes, based on our evaluation, the extent to
which the Army and Marine Corps depot maintenance strategic plans
discuss these four issues.
Table 3: Assessment of OSD-Identified Issues within the Army and Marine
Corps Depot Maintenance Strategic Plans:
OSD-identified issues to be addressed in the military service depot
maintenance strategic plans: Logistics transformation;
Army plan: Partially addressed: For example, the plan makes statements
that the Army intends to address the role/capabilities envisioned for
their depots. However, the actions within the plan are broad and
unclear and do not state when the actions will be complete;
Marine Corps plan: Partially addressed: For example, the plan does
provide actions for potential organizational changes such as study the
feasibility of constructing limited, forward deployed temporary repair
facilities from the Maritime Propositioning Force. However, the plan
does not contain a discussion on how or when they plan to take these
actions.
OSD-identified issues to be addressed in the military service depot
maintenance strategic plans: Core logistics capability assurance;
Army plan: Partially addressed: For example, the plan states the Army
has not been following policy on maintaining a core logistics
capability, but addresses the need to improve policy and procedures to
identify core capabilities. The plan and accompanying implementation
action plan does not contain metrics to fully measure progress;
Marine Corps plan: Partially addressed: For example, the plan does
mention core requirement including source of repair decisions. The
statement in the plan is very general and does not explain how the
Marine Corps plans will be responsive to the regulations and directives
on core requirements.
OSD-identified issues to be addressed in the military service depot
maintenance strategic plans: Workforce revitalization;
Army plan: Partially addressed: For example, the plan does cite the
need for the workforce to change with the changing mission needs and
meet future core capability while maintaining flexibility. However, the
plan does not contain a timeframe for completing the actions;
Marine Corps plan: Partially addressed: For example, the plan states
actions, such as the need to have information on projected retirements.
The plan does not contain a discussion on how or when the Marine Corps
plans to take these actions.
OSD-identified issues to be addressed in the military service depot
maintenance strategic plans: Capital investment;
Army plan: Partially addressed: For example, the plan has an objective
that addresses updating the infrastructure by identifying military
construction projects required to modernize organic depots and update
the Capital Investment Plan. However, neither the plan nor the
accompanying implementation plan identifies a method for prioritizing
needed investments or projected funding;
Marine Corps plan: Partially addressed: For example, the plan appears
to address the capabilities that Marine Corp intends to provide through
its planned investments. However, the plan is vague and provides no
strategy on how the Marine Corps plans to implement the investments.
Source: GAO analysis of Army and Marine Corps depot maintenance
strategic plans.
[End of table]
Army and Marine Corps officials involved with the development of the
service strategic plans acknowledged that their plans do not fully
address the OSD criteria, but they stated that the plans nevertheless
address issues they believe are critical to maintaining effective, long-
term depot maintenance capabilities. An official in the Office of the
Deputy Chief of Staff of the Army, G4, [Footnote 14] who was involved
with the Army's depot maintenance strategic plan acknowledged that the
Army's plan does not fully address OSD's criteria. According to this
official, the Army's plan focuses on issues of greatest priority to the
service's depots. The official added that the OSD criteria lacked clear
and specific instructions to the services. According to an official in
the Marine Corps' Logistics Plans, Policy, and Strategic Mobility
Division who was involved with that service's depot maintenance
strategic plan, the Marine Corps' plan was intended to be only an
overarching outline and was not intended to provide the detailed "nuts
and bolts" that would be needed for implementation. The Army and Marine
Corps have not updated their strategic plan since initially submitting
them to OSD in 2008, and since that time neither service has received
notice from OSD that its plan did not meet OSD's criteria or should be
revised and updated. An OSD official in the Office of the Deputy
Secretary of Defense for Logistics and Materiel Readiness told us that
although the services' strategic plans are not completely responsive to
OSD's direction, they represent a good first start on developing a
strategic plan. Although OSD plans to require the services to update
their plans, this official told us that OSD would wait until after
completion of the Quadrennial Defense Review. That review is to be
completed in early 2010. According to the OSD official, it would be
counterproductive to ask the services to update their strategic plans
in 2009 and then update them again following the Quadrennial Defense
Review.[Footnote 15]
Strategic Plans Do Not Address Uncertainties in Workload That Affect
the Depots' Ability to Plan for Meeting Future Maintenance
Requirements:
The Army's and Marine Corps' depot maintenance strategic plans do not
provide strategies for mitigating and reducing uncertainties in future
workloads that affect the depots' ability to plan for meeting future
maintenance requirements. These uncertainties stem primarily from a
lack of information from the depots' major commands on workload that
will replace current work on legacy systems, which is expected to
decline, as well as workload associated with new systems that are in
the acquisition pipeline (which is discussed further in the next
section of this report). Workload uncertainties hinder effective
planning for meeting future depot maintenance requirements because
workload is a key driver in planning for the necessary capabilities
such as workforce skills, equipment, and infrastructure. Depot
officials said that these resources require significant lead times to
develop and put in place to effectively respond to the customers'
needs. In the absence of timely and reliable data on future workloads,
the depots' efforts to identify and develop needed capabilities and to
conduct workforce planning may be adversely affected.
The depots' major commands generate workload projections from workload
forecasting systems and are based on past history and discussions with
customers about workload planned for the depots. The Army uses the Army
Workload and Performance System as a tool for projecting future
workloads, coordinating personnel requirements, managing resources, and
tracking performance. The Marine Corps use the Principle End Item
Stratification Module within the Material Capability Decision Support
System to determine its depot level maintenance requirements. Army and
Marine Corps guidance identifies workload as a key planning factor for
supporting the expected life of a materiel system. For example, Army
Regulation 750-1, Army Materiel Maintenance Policy, states that a depot
maintenance capability will be established and sustained on the basis
of workload generated by those weapon systems and materiel that is
essential to the completion of the Army's primary roles and mission.
The Marine Corps' Depot Level Maintenance Program guide establishes
general guidelines for planning workloads for the depots.
Although the services have guidance, systems, and processes for
workload planning, depot officials told us that the workload forecasts
they receive from their major commands are unreliable beyond the
current fiscal year. Officials cited various factors that contribute to
workload uncertainties, such as the volatility in workload
requirements; changing wartime environment; budget instability,
including the timing of and heavy reliance on supplemental funding; and
unanticipated changes in customer orders. Depot officials also cited
other factors such as delayed work returning from theater and workload
cancellations. Depot officials told us that they were not in a position
to address these factors on their own, and that reducing or mitigating
future workload uncertainties would require substantial involvement of
the service headquarter organizations and major commands that are
responsible for managing the depots. Officials at the TACOM Life Cycle
Management Command,[Footnote 16] one of the commands that support two
Army depots, said that they too had difficulty forecasting workload
flowing to the depots because of factors that were outside their
control, such as technology development and surge requirements. Marine
Corps Logistics Command officials said that they are currently
implementing an enterprise-level maintenance program that focuses on
how to better identify future year requirements.
Army and Marine Corps depot officials expressed particular concern that
they lacked information on workloads that might replace some of their
current work on legacy systems that is expected to decline due to
various factors, including a drawdown of U.S. forces resulting from a
decline in combat operations in Iraq and from the 2005 BRAC decisions.
For example, Anniston Army depot's work on the M1 Abrams tank fleet is
projected to decrease from about 6,000 tanks to 2,500 tanks by fiscal
year 2013, as a result of the Army's projected decline in demand. In
addition, the 2005 BRAC decision is expected to reduce future workload
at the Marine Corps' Barstow depot by about 30 percent by fiscal year
2011, when BRAC is fully implemented.[Footnote 17] Moreover, Army and
Marine Corps officials noted that the surge in workload resulting from
operations in Iraq could be masking a decline in traditional organic
depot work that occurred during this operation. Furthermore, these
officials expressed concern that they lack information on workload
associated with new and modified systems in the acquisition pipeline
that will require future maintenance support at the depots. Depot
officials also said that they are not involved in the sustainment
portion of the life cycle management planning process for new and
modified systems. Army Aviation and Missile Command officials said that
the life cycle sustainment planning process is a responsibility of the
program manager. While the command is operationally aligned with the
program manager and plays a significant role in deciding how weapon
systems will be supported, they do not include the depots in this
planning process.
Both the Army's and the Marine Corps' depot maintenance strategic plans
recognize that forecasting workload is important to the depots.
However, while the Army's strategic plan notes the need to identify
sufficient work for its depots, it does not explain how or when the
Army will take steps to develop more reliable forecasts or take other
steps that could reduce or mitigate depot workload uncertainties. The
Marine Corps' strategic plan also mentions workload estimating, stating
that the Marine Corps plans to forecast depot maintenance workload with
sufficient lead time to allow it to analyze the required depot
capabilities. However, the strategic plan does not specify how the
depots will be involved in this process, how this process will be
accomplished, or who is going to be held accountable to ensure that
this process is performed.
The Plans Do Not Address Whether and How the Depots Will Have a Role in
Planning for the Sustainment of New and Modified Weapon Systems:
Neither the Army's nor the Marine Corps' strategic plans address
whether and how the depots will be integrated into the sustainment
portion of the life cycle management planning process for new and
modified weapon systems. During this process, weapon system program
managers plan for how and where a new or modified system will be
supported and maintained in the future--decisions that have a profound
impact on planning future depot workload and related infrastructure,
capital investments, and workforce requirements. According to depot
officials, they are not involved in the program managers' planning
because no clear process exists that would enable them to have input.
The department's overarching acquisition guidance, DOD Directive
5000.01,[Footnote 18] states that the program manager shall be the
single point of accountability for accomplishing program objectives for
total life-cycle systems management, including sustainment. While
program managers are required to assign work to the depots to maintain
core capabilities, they have no formal requirement to include the
depots in the sustainment planning process to determine how a weapon
system will be supported. In prior reports, we have noted that program
managers often make decisions to contract out the repair of new and
modified systems without considering the impact of these decisions on
the requirement to maintain core capability for essential systems in
military depots.[Footnote 19] Our recent report on core depot
maintenance indicates that shortcomings in DOD's acquisition guidance
and its implementation have resulted in DOD program managers not
identifying and establishing required core capability at military
depots in a timely manner--capability that will be needed to support
future maintenance requirements for new and modified systems.[Footnote
20]
The depots' lack of involvement in life cycle management planning
limits their ability to influence how weapon systems being acquired by
their service will be sustained, and also plan for and develop
capabilities they will need to support these systems in the future. For
example, even though Red River Army depot is designated as the primary
repair facility for Bradley Fighting Vehicles, depot planners stated
that they were not involved in the Army's life cycle management
planning process to decide which facility would have full capability to
perform the test and repair work on the newer model of the Bradley A3.
As a result, this depot received minimal work associated with this
weapon system, while the majority of this work--including the testing
on the turret and the major overhaul of the system--went to a private
contractor.
According to depot officials, including the depots in the sustainment
portion of the life cycle management planning process cannot be
achieved without full participation and coordination between the
sustainment and acquisition communities, and without consistent
communication between the services' major commands and the depots
during the process of determining how new and modified systems will be
sustained. The Army Materiel Command's Industrial Base Strategic Plan
notes the importance of developing a process that provides closer
interface between the acquisition and sustainment communities to ensure
that future weapon system requirements are matched with organic
sustainment capabilities early in the acquisition process.[Footnote 21]
Also, the Marine Corps Logistics Command's Alignment and Integration
Strategic Plan emphasizes the importance of this command to assist
program managers with the planning and execution of total life cycle
management responsibilities for their weapon systems.[Footnote 22]
Without a clear process to integrate the depots in the sustainment
portion of the life cycle management planning process, the depots
cannot determine what capabilities are needed to plan for future
workloads and what other resources are needed to support new and
modified weapon systems.
Conclusions:
The Army and Marine Corps face some challenges to ensure that their
maintenance depots will remain operationally effective, efficient, and
capable of meeting future maintenance requirements. The increased
reliance on contractor support for weapon systems, including contractor
support provided through performance-based logistics, and the
continuing uncertainties about workload, increase the risk that the
depots may not be postured and resourced to meet future requirements.
These issues, if not addressed, could adversely affect materiel
readiness and future depot operations and potentially lead to equipment
shortages and delays in meeting the combatant commander's requirements.
While strategic planning is a valuable management tool to help mitigate
the challenges facing the depots, the Army and Marine Corps plans as
currently written are not comprehensive enough for this purpose. The
plans do not fully address all the elements needed for a results-
oriented management strategy or the specific issues that OSD directed
each service, at a minimum, to include in their plans. Furthermore,
until the services address problems caused by workload uncertainties,
the depots will continue to have difficulties planning for future
maintenance requirements. Regarding workload uncertainties for systems
that have yet to enter the defense inventory, without a clear process
for integrating the depots into the sustainment portion of the life
cycle management planning process, the depots may continue to lose key
opportunities to develop needed capabilities that would enable them to
provide depot level maintenance support for new and modified systems.
Recommendations for Executive Action:
To provide greater assurance that the military depots will be postured
and resourced to meet future maintenance requirements, we recommend
that the Secretary of Defense direct the Secretary of the Army and the
Commandant of the Marine Corps to take the following three actions to
update the depot maintenance strategic plans:
* Fully address all elements needed for a comprehensive results-
oriented management framework, including those elements partially
addressed in the current plans---such as the approaches for
accomplishing goals and objectives, stakeholder involvement, external
factors that may affect how goals and objectives will be accomplished,
performance goals that are objective, quantifiable, and measurable,
resources needed to meet performance goals, performance indicators used
to measure outcomes and gauge progress, and an evaluation plan that
monitors goals and objectives.
* Fully address the four specific issues of logistics transformation,
core capability assurance, workforce revitalization, and
capitalization, consistent with OSD criteria provided to the services.
* Develop goals and objectives, as well as related strategic planning
elements, aimed at mitigating and reducing future workload
uncertainties. As part of this last effort, the Army and Marine Corps
should develop a clear process for integrating the depots' input into
the sustainment portion of the life cycle management planning process
for systems in the acquisition pipeline.
Agency Comments and Our Evaluation:
In written comments on a draft of this report, DOD concurred with all
three of our recommendations to provide greater assurance that the
military depots will be postured and resourced to meet future
maintenance requirements. DOD's written comments are reprinted in
appendix IV.
The department concurred with our first two recommendations to direct
the Army and the Marine Corps to update their depot maintenance
strategic plans to fully address all elements needed for a
comprehensive results-oriented management framework, and fully address
the four specific issues of logistics transformation, core capability
assurance, workforce revitalization, and capitalization, consistent
with OSD criteria provided to the services. DOD stated that they will
reiterate and incorporate these recommendations into the next update of
the strategic plan. While this is a step in the right direction, DOD
did not indicate what steps, if any, it plans to take to ensure that
the Army and Marine Corps will also incorporate these recommendations
into their depot maintenance strategic plans. Therefore, DOD may need
to take further action by following up with the Army and Marine Corps
to ensure that they fully incorporate these recommendations into their
depot maintenance strategic plans.
DOD also concurred with our third recommendation to direct the Army and
Marine Corps to develop goals and objectives for mitigating and
reducing future workload uncertainties and integrate the depot's input
into the sustainment portion of the life cycle management planning
process. DOD stated that the Army has initiated several actions to
mitigate and reduce uncertainties in projecting future depot workload
and to ensure viability of the depot workforce. DOD said that the Army
has established integrated product teams to address core workload
shortfalls and developed an action plan and the resources and time line
required to transfer sufficient workload from the original equipment
manufacturers to the applicable Army depot to meet core requirements.
In addition, DOD said that the Army has begun to develop policy that
would require review of Core Logistic Assessments/Core Depot
Assessments and Source of Repair Analyses during the milestone decision
review process, and to develop a comprehensive training package for
export to program executive officers and program managers, Life Cycle
Management Commands, and depots. While these are positive steps that
would help to improve future workload planning, these steps focus on
addressing core requirements and do not fully address the need to
mitigate and reduce workload uncertainties or to include the depots'
input into the sustainment portion of the life cycle management
planning process for systems in the acquisition pipeline. We continue
to believe the depots will have difficulties planning for future
maintenance requirements until the services develop solutions for
mitigating and reducing uncertainties across the full range of the
depots' workloads. We also continue to believe that without a clear
process for integrating the depots into the sustainment portion of the
life cycle management planning process, the depots will continue to
lose key opportunities to develop capabilities that would enable them
to provide depot-level support for systems in the acquisition pipeline.
The department reiterated its plan to incorporate our recommendations
into the next update of the strategic plan. As we stated above with
regard to our first two recommendations, DOD may need to take further
action by following up with the Army and Marine Corps to ensure that
they fully incorporate this recommendation into their depot maintenance
strategic plans.
We are sending copies of this report to the appropriate congressional
committees and the Secretary of Defense, the Secretaries of the Army,
the Navy, the Air Force, and the Commandant of the Marine Corps. In
addition, this report will be available at no charge on the GAO Web
site at [hyperlink, http://www.gao.gov].
Contact points for our Offices of Congressional Relations and Public
Affairs may be found on the last page of this report. If you or your
staff have questions about this report, please contact me at (202) 512-
8365 or solisw@gao.gov. Key contributors to this report are listed in
appendix VI.
Signed by:
William M. Solis:
Director, Defense Capabilities and Management:
[End of section]
Appendix I: Scope and Methodology:
To evaluate the extent to which the Army's and Marine Corps' strategic
plans provide a comprehensive strategy for meeting future depot
maintenance requirements, we assessed the Army's April 2008 Depot
Maintenance Enterprise Strategic Plan, and the Marine Corps February
2008 Depot Maintenance Strategic Plan to determine if they are
consistent with the criteria for developing a comprehensive results-
oriented management framework as indicated in GAO's prior work on
strategic management plans. While the Office of the Secretary of
Defense (OSD) required all the services to prepare and submit such
plans to them, we decided to focus our work on the Army's and Marine
Corps' plans because of their significant roles in supporting overseas
contingency operations in Iraq and Afghanistan. We also determined if
the Army's and Marine Corps' strategic plans for depot maintenance
fully addressed the criteria for developing a strategic plan specified
in the Department of Defense (DOD) March 2007 Depot Maintenance
Strategy and Implementation Plans. Furthermore, we determined if the
Office of the Under Secretary of Defense for Logistics and Materiel
Readiness assessed the services' depot management strategic plans and
provided follow on actions to ensure the plans meet their criteria. In
addition, we reviewed and addressed issues regarding uncertainties in
projecting future workloads, which is necessary for effective depot
planning. We also interviewed depot management officials to determine
the depots' participation in the sustainment portion of the life cycle
management planning process to effectively plan and prepare for future
maintenance work and related capabilities.
To gain further perspective on the services' efforts to plan for the
future of the depot maintenance facilities, we interviewed and obtained
documentation from officials at Headquarters, Department of the Army,
Washington, D.C.; U.S. Army Materiel Command, Fort Belvoir, Virginia;
Headquarters Marine Corps, Arlington, Virginia; Marine Corps Systems
Command, Quantico, Virginia; and Marine Corps Logistics Command,
Albany, Georgia. We also visited, interviewed, and obtained
documentation from officials at the Army's five maintenance depots that
perform organic level maintenance at Anniston Army Depot, Anniston,
Alabama; Corpus Christi Army Depot, Corpus Christi, Texas; Letterkenny
Army Depot, Chambersburg, Pennsylvania; Red River Army Depot,
Texarkana, Texas; and Tobyhanna Army Depot, Tobyhanna, Pennsylvania. In
addition, we visited, interviewed depot officials and obtained
documentation from the Marine Corps' two maintenance depots that
perform organic level maintenance at Maintenance Center Albany, Georgia
and Maintenance Center Barstow, California. Furthermore, we obtained
data and information on actions aimed at improving depot productivity
at the Army and Marine Corps depots and data on the depots' workforce
trends from fiscal year 1999 through fiscal year 2008. We determined
that the data used were sufficiently reliable for our purposes. We
conducted this performance audit from August 2007 through September
2009 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
[End of section]
Appendix II: Army and Marine Corps Depot Actions to Improve
Productivity:
Both the Army and Marine Corps depots have reported actions they have
taken to improve their productivity. The depots have reported that they
have improved their maintenance operations' productivity and efficiency
through the use of several process improvements including Lean, Six
Sigma, Value Stream Mapping, and Theory of Constraints. They report
that such improvements have allowed them to identify and reduce or
eliminate unnecessary work-related functions and other impediments that
created restrictions or "bottlenecks" in their production processes and
have resulted in increases in the number of weapon systems or other
components processed, reductions in repair cycle times,[Footnote 23]
and reductions in the cost of production. The Army[Footnote 24] and
Marine Corps[Footnote 25] have issued a policy and a guidebook,
respectively, aimed at improving the depots' repair processes,
including information on assessing the depots' progress in making,
sharing, and sustaining improvements and in measuring overall
productivity. We questioned depot officials about the data associated
with these improvements and relied on their professional judgment
concerning the adequacy and reliability of the data.
Table 4 shows information reported by the Army depots on the results of
initiatives to improve the repair process for selected weapon systems-
-one from each of the five Army depots. The Army depots generally
assess the results of their productivity improvements based on
increases in the number of units produced, reductions in repair cycle
times, and reductions in production costs. The third column shows the
period during fiscal years 2004 through 2007 in which the initiative
was implemented. The fourth column shows the average reduction in
repair cycle time expressed in days, and the fifth column shows this
reduction expressed as a percentage by which repair time was reduced.
The final column shows the estimated cost reduction or savings that the
Army depots reported for the period. Army depot officials told us that
there is limited sharing of lessons learned or cross application among
the depots and that increased sharing and cross application could
contribute to additional reductions in repair days and cost savings or
cost avoidances.
Table 4: Results of Selected Army Depots' Process Improvements, Fiscal
Years 2004 through 2007:
Depot: Anniston;
Weapon system: Field Artillery Ammunition Vehicle;
Fiscal years: 2004 to 2006;
Repair cycle reduction (days): 3;
Repair cycle reduction (percentage): 8.6%;
Estimated cost reduction/savings (millions of dollars): $2.50.
Depot: Corpus Christi;
Weapon system: UH-60 Tail Rotor Blades Processes;
Fiscal years: 2006 to 2007;
Repair cycle reduction (days): 7;
Repair cycle reduction (percentage): 35%;
Estimated cost reduction/savings (millions of dollars): $3.90.
Depot: Letterkenny;
Weapon system: High Mobility Multipurpose Wheeled Vehicle Recap;
Fiscal years: 2005;
Repair cycle reduction (days): 43;
Repair cycle reduction (percentage): 73%;
Estimated cost reduction/savings (millions of dollars): $5.20.
Depot: Red River;
Weapon system: High Mobility Multipurpose Wheeled Vehicle Recap;
Fiscal years: 2004 to 2006;
Repair cycle reduction (days): 3;
Repair cycle reduction (percentage): 75%;
Estimated cost reduction/savings (millions of dollars): $3.90.
Depot: Tobyhanna;
Weapon system: Firefinder Antenna Transceiver Group;
Fiscal years: 2004 to 2007; Repair cycle reduction (days): 15;
Repair cycle reduction (percentage): 12%;
Estimated cost reduction/savings (millions of dollars): $0.02.
Source: GAO analysis of selected Army depots' process improvements.
[End of table]
Table 5 shows information reported by the Marine Corps depots on the
results of initiatives to improve the repair process for selected
weapons systems repaired at its two depots for fiscal years 2004
through 2007. The Marine Corps depots generally assess the results of
their productivity improvements based on reductions in repair cycle
times. The second column shows the average number of days taken for the
repair cycle in fiscal year 2004, the baseline year before the depots
initiated their process improvement initiatives[Footnote 26]. The third
column shows the average number days the depots reported for repair
cycle time in fiscal year 2007, after implementing process improvement
initiatives. The fourth and fifth columns show the reported reduction
in repair time expressed as number of days and the percentage by which
repair time was reduced. The Marine Corps depots generally do not
either capture or report cost savings or cost avoidances resulting from
such improvements. A Marine Corps official responsible for managing the
results of the depots' improvement told us that some of the reductions
in repair days were achieved by using overtime and multiple shifts. The
official also told us that there is limited sharing of lessons learned
or cross application among the depots and that increased sharing and
cross application could contribute to additional reductions in repair
days and in cost savings or cost avoidances.
Table 5: Results of Selected Marine Corps Depots' Process Improvements,
Fiscal Years 2004 through 2007:
Depot/weapon system: Albany: MK-48;
2004 average repair cycle (days): 100;
2007 average repair cycle (days): 38;
Reduction in repair cycle (days): 62;
Percentage reduction: 62%.
Depot/weapon system: Albany: MK-15 Trailer;
2004 average repair cycle (days): 71;
2007 average repair cycle (days): 5;
Reduction in repair cycle (days): 66;
Percentage reduction: 93%.
Depot/weapon system: Albany: MK-17 Trailer;
2004 average repair cycle (days): 53;
2007 average repair cycle (days): 10;
Reduction in repair cycle (days): 43;
Percentage reduction: 81%.
Depot/weapon system: Albany: M970 Refueler;
2004 average repair cycle (days): 86;
2007 average repair cycle (days): 4;
Reduction in repair cycle (days): 82;
Percentage reduction: 95%.
Depot/weapon system: Albany: M149A2 Water Trailer;
2004 average repair cycle (days): 49;
2007 average repair cycle (days): 19;
Reduction in repair cycle (days): 30;
Percentage reduction: 61%.
Depot/weapon system: Albany: M88 Tank Retriever;
2004 average repair cycle (days): 89;
2007 average repair cycle (days): 31;
Reduction in repair cycle (days): 58;
Percentage reduction: 65%.
Depot/weapon system: Barstow: LAV 25;
2004 average repair cycle (days): 180;
2007 average repair cycle (days): 96;
Reduction in repair cycle (days): 84;
Percentage reduction: 47%.
Depot/weapon system: Barstow: LAV Anti-Tank;
2004 average repair cycle (days): 182;
2007 average repair cycle (days): 145;
Reduction in repair cycle (days): 37;
Percentage reduction: 20%.
Depot/weapon system: Barstow: M970 Tanker;
2004 average repair cycle (days): 129;
2007 average repair cycle (days): 104;
Reduction in repair cycle (days): 25;
Percentage reduction: 19%.
Depot/weapon system: Barstow: MK-14 Trailer;
2004 average repair cycle (days): 152;
2007 average repair cycle (days): 39;
Reduction in repair cycle (days): 113;
Percentage reduction: 74%.
Source: GAO analysis of selected Marine Corps depots' process
improvements.
[End of table]
[End of section]
Appendix III: Trends in Army and Marine Corps Depot Workforce Levels:
Workforce levels for the Army and Marine Corps depots have been
increasing along with the workloads since fiscal year 2003. The depots
have accommodated the surge in workload by hiring primarily temporary
and contract employees. Depot officials told us they hired temporary
and contract workers in lieu of permanent government workers due to
uncertainties about the duration of the overseas contingency operations
in Iraq and Afghanistan. The depots plan to reduce temporary and
contract labor as workload related contingency operations decreases.
Although uncertainties about future workload inhibit their workforce
planning, we found that the depots' workforce strategic planning
addresses anticipated personnel and skill gaps. For example, while the
workloads have increased, the depots have been able to maintain a
skilled workforce. In addition, with a large percentage of depot
workers becoming eligible to retire over the next 5 years, some of the
depots are working with local community colleges to provide specialized
programs focused on skills needed by the depots.
The Army and Marine Corps depots' workforce was relatively stable from
fiscal year 1999 though fiscal year 2002. The depots report that the
increase in workload associated with the Global War on Terrorism (GWOT)
began during fiscal year 2003. Before GWOT, the total depot workforce
was more than 89 percent permanent government employees, but at the end
of fiscal year 2008 permanent government employees made up only 62
percent of the total depot workforce. After remaining relatively
constant from fiscal year 1999 through fiscal year 2002, total
workforce increased from fiscal year 2003 through fiscal year 2008,
along with the increases in workload associated with GWOT. From fiscal
year 2003 through fiscal year 2008, the Army depots' workforce
increased by 106 percent and the Marine Corps' by 99 percent. Figures 1
and 2 illustrate these changes in the Army's and the Marine Corps'
depots' workforces from fiscal year 1999 through fiscal year 2008.
Figure 1: Army Depots' Workforce by Category, Fiscal Years 1999 to
2008:
[Refer to PDF for image: multiple line graph]
Fiscal year: 1999;
Permanent workforce: 9,606;
Temporary workforce: 191;
Contract workforce: 55;
Total workforce: 9,879.
Fiscal year: 2000;
Permanent workforce: 8,943;
Temporary workforce: 146;
Contract workforce: 357;
Total workforce: 9,477.
Fiscal year: 2001;
Permanent workforce: 9,375;
Temporary workforce: 259;
Contract workforce: 205;
Total workforce: 9,956.
Fiscal year: 2002;
Permanent workforce: 9,367;
Temporary workforce: 687;
Contract workforce: 418;
Total workforce: 10,599.
Fiscal year: 2003;
Permanent workforce: 9,906;
Temporary workforce: 405;
Contract workforce: 623;
Total workforce: 11,089.
Fiscal year: 2004;
Permanent workforce: 11,187;
Temporary workforce: 737;
Contract workforce: 1,451;
Total workforce: 13,606.
Fiscal year: 2005;
Permanent workforce: 12,249;
Temporary workforce: 1,132;
Contract workforce: 1,973;
Total workforce: 15,639.
Fiscal year: 2006;
Permanent workforce: 12,468;
Temporary workforce: 1,927;
Contract workforce: 2,371;
Total workforce: 17,070.
Fiscal year: 2007;
Permanent workforce: 12,711;
Temporary workforce: 2,312;
Contract workforce: 3,316;
Total workforce: 18,658.
Fiscal year: 2008;
Permanent workforce: 14,343;
Temporary workforce: 3,452;
Contract workforce: 4,968;
Total workforce: 22,864.
Source: GAO analysis of Army depots‘ workforce data.
Note: Excludes data on the part-time workforce, which constitutes a
small proportion of the total workforce.
[End of figure]
Figure 2: Marine Corps Depots' Workforce by Category, Fiscal Years 1999
to 2008:
[Refer to PDF for image: multiple line graph]
Fiscal year: 1999;
Permanent workforce: 1,569;
Temporary workforce: 60;
Contract workforce: 48;
Total workforce: 1,680.
Fiscal year: 2000;
Permanent workforce: 1,502;
Temporary workforce: 262;
Contract workforce: 23;
Total workforce: 1,788.
Fiscal year: 2001;
Permanent workforce: 1,374;
Temporary workforce: 138;
Contract workforce: 21;
Total workforce: 1,533.
Fiscal year: 2002;
Permanent workforce: 1,323;
Temporary workforce: 130;
Contract workforce: 21;
Total workforce: 1,481.
Fiscal year: 2003;
Permanent workforce: 1,313;
Temporary workforce: 171;
Contract workforce: 19;
Total workforce: 1,506.
Fiscal year: 2004;
Permanent workforce: 1,377;
Temporary workforce: 372;
Contract workforce: 17;
Total workforce: 1,768.
Fiscal year: 2005;
Permanent workforce: 1,432;
Temporary workforce: 807;
Contract workforce: 250;
Total workforce: 2,489.
Fiscal year: 2006;
Permanent workforce: 1,489;
Temporary workforce: 629;
Contract workforce: 584;
Total workforce: 2,702.
Fiscal year: 2007;
Permanent workforce: 1,523;
Temporary workforce: 540;
Contract workforce: 735;
Total workforce: 2,798.
Fiscal year: 2008;
Permanent workforce: 1,573;
Temporary workforce: 743;
Contract workforce: 677;
Total workforce: 2,993.
Source: GAO analysis of Marine Corps depots‘ workforce data.
Note: Excludes data on the part-time workforce, which constitutes a
small proportion of the total workforce.
[End of figure]
The trends reflected in figures 1 and 2 show marked changes in the
composition of the Army's and Marine Corps' depots' workforces since
fiscal year 2003. The largest increases have been in the number of
temporary workers and contract labor hired in lieu of permanent staff.
As GWOT continued and the workload continued to increase, the depots
continued to hire more temporary and contract workers to accommodate
the increased workload. The depots plan to reduce the number of
temporary and contract workers as they employ GWOT-related workload
decreases.
As figures 1 and 2 illustrate, in fiscal year 2008, 37 percent of the
Army depots' workforce and 48 percent of the Marine Corps depots'
workforce were comprised of temporary and contract workers.
Specifically, temporary workers represented about 15 percent of the
Army depots' workforce and 25 percent of the Marine Corps depots'
workforce. Contract workers represented about 22 percent of the Army
depots' workforce and about 23 percent of the Marine Corps depots'
workforce.
We have previously reported that the depots may face challenges that
could inhibit effective strategic workforce planning.[Footnote 27]
These challenges include the high average age of workers, difficulty in
maintaining depot viability if large numbers of eligible skilled
workers retire, and lack of an available source of trained and skilled
personnel. The Army and Marine Corps depots' have reduced the average
age of their permanent workers. For fiscal year 2008, the age of
permanent workers in the Army's depots averaged 45, and the age of
permanent workers in the Marine Corps' depot averaged 46. Since fiscal
year 1999, the average age of the Army's permanent depot workers has
decreased by 9 percent, while that of the Marine Corps' has decreased
by 12 percent. Depot officials attributed this reduction to the
retirement of older permanent workers; the availability of younger,
qualified applicants; and in-house training programs.
The depots have developed workforce strategic plans that address
current and anticipated personnel and skill gaps. These plans include
maintaining a mix of personnel with the skills and capabilities needed
to satisfy current workload requirements. According to Army and Marine
Corps depot officials, permanent, skilled workers are readily
available. Further, the depots forecast a high rate of retirement
eligibility in the next 5 years, and they are taking steps to address
the potential loss of skilled personnel. According to Army data, 34
percent of the Army's permanent depot workforce will be eligible for
retirement in fiscal year 2013. According to Marine Corps data, 43
percent of the Marine Corps' permanent depot workforce will also be
eligible for retirement in fiscal year 2013. Both services' depots
track and monitor personnel who may be eligible to retire soon,
considering their skills in order to address potential skill gaps in
the future workforce. Both Army and Marine Corps depots address this
potential loss of personnel and skills in their workforce strategic
plans, and they have instituted various types of recruitment and
training programs designed to attract and train workers.
[End of section]
Appendix IV: Comments from the Department of Defense:
Deputy Under Secretary Of Defense For Logistics And Materiel Readiness
2500 Defense Pentagon:
Washington, DC 20301-3500:
September 4, 2009:
Mr. William M. Solis:
Director, Defense Capabilities and Management:
U.S. Government Accountability Office:
441 G Street N.W.
Washington, DC 20548-0041:
Dear Mr. Soles:
This is the Department of Defense (DoD) response to the GAO Draft
Report, GAO-09-865 "Depot Maintenance: Improved Strategic Planning
Needed to Ensure That Army and Marine Corps Depots Can Meet Future
Maintenance Requirements," dated July 30, 2044 (GAO Code 351073).
The Department concurs with all three recommendations. An explanation
of the DoD position is enclosed. The Department appreciates the
opportunity to comment on the Draft Report and requests that the
enclosed comments be made a part of the final report
Sincerely,
Signed by:
Alan F. Estevez:
Acting:
Enclosure: As stated:
[End of letter]
GAO Draft Report - Dated July 30, 2009:
GAO Code 351073/GAO-09-865:
"Depot Maintenance: Improved Strategic Planning Needed to Ensure That
Army and Marine Corps Depots Can Meet Future Maintenance Requirements"
Department Of Defense Comments To The Recommendations:
Recommendation 1: The GAO recommends that the Secretary of Defense
direct the Secretary of the Army and the Commandant of the Marine Corps
to update the depot maintenance strategic plans to fully address all
elements needed for a comprehensive results-oriented management
framework, including those elements partially addressed in the current
plans - such as the approaches for accomplishing goals and objectives,
stakeholder involvement, external factors that may affect how goals and
objectives will be accomplished, performance goals that are objective,
quantifiable, and measurable, resources needed to meet performance
goals, performance indicators used to measure outcomes and gauge
progress, and an evaluation plan that monitors goals and objectives.
(Page 21/GAO Draft Report)
DOD Response: Concur. The Department will reiterate and incorporate the
above recommendations into the next update of the strategic plan.
Recommendation 2: The GAO recommends that the Secretary of Defense
direct the Secretary of the Army and the Commandant of the Marine Corps
to update the depot maintenance strategic plans to fully address the
four specific issue of logistics transformation, core capability
assurance, workforce revitalization, and capitalization, consistent
with 0SD criteria provided to the Services. (Page 21/GAO Draft Report)
DOD Response: Concur. The Department will reiterate and incorporate the
above recommendations into the next update of the strategic plan.
Recommendation 3: The GAO recommends that the Secretary of Defense
direct the Secretary of the Army and the Commandant of the Marine Corps
to update the depot maintenance strategic plans to develop goals and
objectives, as well as related strategic planning elements, aimed at
mitigating and reducing future workload uncertainties. As part of this
last effort, the Army and Marine Corps should develop a clear process
for integrating the depots' input into the sustainment portion of the
life cycle management planning process for systems in the acquisition
pipeline. (Page 21/GAO Draft Report)
DOD Response: Concur. Since the Army's Depot Management Strategic plan
was developed in 2008 the Army has initiated several actions to
mitigate/reduce uncertainties in the projecting future depot workload
and to ensure viability of the depot workforce. The Army has
established Core Workload Integrated Product Teams to address Core
workload shortfalls and developed action plan and the
resources/timeline required to transfer sufficient workload from the
Original Equipment Manufactures to the applicable Army depot to meet
Core requirements. The Army has also initiated the development of
policy that requires review of Core Logistic Assessments(CLA}/Core
Depot Assessments and Source of Repair Analyses(SORA) during the
Milestone Decision Review process as well as development of a
comprehensive CLA/SORA training package for export to Program Executive
Officers/Program Managers, Life Cycle Management Commands and deports.
However, to ensure comprehensive strategic plans, the Department will
reiterate and incorporate the recommendations into the next update of
the strategic plan.
[End of section]
Appendix V: GAO Contact and Staff Acknowledgments:
GAO Contact:
William M. Solis, (202) 512-8365 or solisw@gao.gov:
Staff Acknowledgments:
In addition to the contact named above, Julia Denman and Tom Gosling,
Assistant Directors; Larry Bridges; John Clary; Joanne Landesman;
Latrealle Lee; Katherine Lenane; and Christopher Watson made key
contributions to this report.
[End of section]
Footnotes:
[1] Resetting the force involves repairing, replacing, and
recapitalizing equipment in preparation for future military operations.
[2] Under 10 U.S.C. § 2464, DOD is required to identify and maintain
within government-owned and operated facilities a core logistics
capability, including the equipment, personnel, and technical
competence required to maintain weapon systems identified as necessary
for national defense emergencies and contingencies. In addition, 10
U.S.C 2466(a) requires that not more than 50 percent of annual depot
maintenance funding made available to each military department be used
for private sector performance.
[3] Performance-based logistics, which evolved from the more general
concept of performance-based contracting, refers to the purchase of
performance outcomes (such as the availability of functioning weapon
systems) through long-term support arrangements rather than the
purchase of individual elements of support--such as parts, repairs, and
engineering support.
[4] OSD outlined the military services' depot maintenance strategic
planning responsibilities in its Report to Congress. See Department of
Defense, Depot Maintenance Strategy and Implementation Plans, part I-21
through I-24 (Washington, D.C. March 2007). This document established
OSD criteria for the services' strategic plans.
[5] GAO, Army Working Capital Fund: Actions Needed to Reduce Carryover
at Army Depots, [hyperlink, http://www.gao.gov/products/GAO-08-714]
(Washington, D.C.: July 8, 2008).
[6] GAO, Defense Logistics: Improved Analysis and Cost Data Needed to
Evaluate the Cost-effectiveness of Performance Based Logistics,
[hyperlink, http://www.gao.gov/products/GAO-09-41] (Washington, D.C.:
Dec. 19, 2008).
[7] GAO, Depot Maintenance: Actions Needed to Identify and Establish
Core Capability at Military Depots, [hyperlink,
http://www.gao.gov/products/GAO-09-83] (Washington, D.C.: May 14,
2009).
[8] Includes permanent government personnel, temporary workers, and
contract workers.
[9] Depot-level maintenance and repair also includes all aspects of
software maintenance classified by DOD as of July 1, 1995, as depot-
level maintenance and repair, and interim contractor support or
contractor logistics support, to the extent that such support is for
the performance of service as described above. Depot-level maintenance
and repair does not include the procurement of major modifications or
upgrades of weapon systems that are designed to improve program
performance or the nuclear refueling of an aircraft carrier; however, a
major upgrade program covered by this exception could continue to be
performed by private or public sector activities. Depot-level
maintenance also does not include the procurement of parts for safety
modifications, but does include the installation of parts for that
purpose.
[10] GAO, DOD Civilian Personnel: Improved Strategic Planning Needed to
Help Ensure Viability of DOD's Civilian Industrial Workforce,
[hyperlink, http://www.gao.gov/products/GAO-03-472] (Washington, D.C.:
April 30, 2003).
[11] H.R. Rept. No. 108-106, p. 304 (2003), H.R. Rept. No. 109-452, p.
296 (2006).
[12] The Army submitted its strategic plan to OSD in June 2008, and the
Marine Corps submitted its plan in March 2008.
[13] GAO, Results-Oriented Cultures: Implementation Steps to Assist
Mergers and Organizational Transformations, [hyperlink,
http://www.gao.gov/products/GAO-03-669] (Washington, D.C.: July 2,
2003); Military Transformation: Clear Leadership, Accountability, and
Management Tools Are Needed to Enhance DOD's Efforts to Transform
Military Capabilities, [hyperlink,
http://www.gao.gov/products/GAO-05-70] (Washington, D.C.: Dec. 17,
2004); and Defense Management: Fully Developed Management Framework
Needed to Guide Air Force Future Total Force Efforts, [hyperlink,
http://www.gao.gov/products/GAO-06-232] (Washington, D.C.: Jan. 31,
2006).
[14] G4 is the acronym for the Army's logistics branch.
[15] DOD officials also noted that the department is sponsoring an on-
going study on future depot capability, in response to section 322 of
the Duncan Hunter National Defense Authorization Act for Fiscal Year
2009, Pub. L. No. 110-417 (2008). The study, among other things, will
contain a quantitative analysis of the post-reset depot capability
required to provide life cycle sustainment of military legacy systems
and new systems and military equipment.
[16] Formally known as the Tank Automotive and Armaments Command.
[17] Barstow used fiscal year's 2003 actual workload and fiscal years'
2004 and 2005 estimated workloads as its base to quantify the potential
loss of work.
[18] DOD Directive 5000.01, The Defense Acquisition System, November
20, 2007.
[19] GAO, Depot Maintenance: Key Unresolved Issues Affect the Army
Depot System's Viability, [hyperlink,
http://www.gao.gov/products/GAO-03-682] (Washington, D.C.: July 7,
2003), and Defense Maintenance: Sustaining Readiness Support
Capabilities Requires a Comprehensive Plan, [hyperlink,
http://www.gao.gov/products/GAO/01-533T] (Washington, D.C.: March 23,
2001).
[20] [hyperlink, http://www.gao.gov/products/GAO-09-83].
[21] U.S. Army Industrial Base, Strategic Plan, April 2006.
[22] United States Marine Corps Logistics Command, Alignment and
Integration Strategic Plan, February 2008.
[23] Repair cycle time is the average number of days that is required
to repair a weapon system or a major component.
[24] Department of the Army, Policy Letter---U.S. Army Materiel Command
(AMC) Continuous Process Improvement (CPI) Policy, January 3, 2006.
[25] United States Marine Corps Continuous Process Improvement
Guidebook, December 21, 2007.
[26] Reductions are measured against operations that existed prior to
implementation of Theory of Constraints (TOC).
[27] GAO, DOD Civilian Personnel: Improved Strategic Planning Needed to
Help Ensure Viability of DOD's Civilian Industrial Workforce, and
[hyperlink, http://www.gao.gov/products/GAO-03-472] (Washington, D.C.:
April 30, 2003).
[End of section]
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