Surface Ship Maintenance Program brief for Virginia Ship Repair Association

UNCLASS Surface Ship Maintenance Programbrief for Virginia Ship Repair Association CAPT Mike Stanton USFF N431 22 APR 2009

Improve process stability; Reduce process variation Overview • USFF Fleet Maintenance Directorate • Program objectives: • ‘Planned Service Life’ view of Maintenance • Areas of responsibility • Strategic Maintenance Process: • Requirements & programming • Maintenance execution planning • Maintenance execution

USFF N43 Maintenance Directorate N43 Fleet Maint Officer RADM(s) Joe Campbell (prospective) FMO RADM(s) Clark Orzalli (May) N43B Deputy FMO Mr. Bob Butler N431 Surface Ship Maint Prog Mgr CAPT Mike Stanton (prospective) CAPT Stephanie Douglas N432 Submarine Maint Prog Mgr CDR Greg Burton N433 Aviation Maint Prog Mgr CAPT Dave Seaton N434 Technical & Process Prog Mgr Mr. Dale Hirschman N435 Financial & Industrial Mgt Mr. Glenn Hottel N436 C5I Branch Head CDR Drew Lambley (IA) N437 Maint Information Sys Mgt Mrs. Maureen Ransom N438 CVN Maint Prog Mgr CAPT Lloyd Jones

Surface Ship Maintenance Program: Focus on Achieving Service Life Requirement: ensure material condition of ships supports Ao, presence requirements & achieves planned service life. • 157 Surface Ships, 11 classes • 11 CSG, 10 ESG, various SNGs & surge reqts • Support current and future readiness: Ao,overall = Ao,FRP + Ao,Lifecycle Priorities • 313 ship Navy: must achieve planned service life for ships in inventory • 49% of surface force service life has been consumed • Stabilizing & refining maintenance requirements • Developing & deploying sound maintenance practices, processes & strategies Significant Congressional interest in the readiness of the Surface Force

Current Readiness Availability execution in support of FRP Ships with marginal material condition Hi-interest INSURVs New Construction readiness (LPD 17, LCS) Future Readiness Breadth & technical rigor of lifecycle maint reqts Programming strategies and risk decisions Availability risk assessment and mitigation New Construction readiness N431 Areas of Responsibility Maint Acquisition Mgt • MSMO Program • Acqn Strat IPT • AFEBs • Maint Contracting Strategies • Maintenance execution strategies and policies • Industry Relations • JINII, VSRA, JASRA FMBoD “locked-in” on Surface Ship Maintenance Program

Savings Potential Strategic Maintenance Process Execution (RMC & MSMO) Planning (RMC & MSMO) Requirements Development (TYCOM, FFC) Programming & Budgeting (FFC, OPNAV) Appropriation & Apportionment (Congress, FMB) Variation Process stage Targeted strategies • MSMO Spiral 2 • SHIPMAIN • - Assessments • - Level-loading • MSMO stabilization • Contracts Governance • Depot work integration • - RMC standardization • Reqts Realism: MRS • - ICMP development • Risk decisions • toward “PSL+” • Industrial base • preservation

under review “technical rigor” Requirements Improvement • January 2009 Surface Ship Maint Strategic Offsite • Must strengthen requirements determination process for ships • CLASSRON: focus on lifecycle maintenance to feed programming Actions • Maintenance Requirements System (MRS) Alliance • Availability notionals “tailoring” projects • Modified docking cycles • “Aged” notionals • Parametric analysis • Surface Ship Life Cycle Management Activity (SSLCM) • ICMP improvement • Standardized availability work packages • ABS Hull-life Surveys (NAVSEA 05)

Mdays/ avail PSA SRA-1 SRA-1 DSRA -1 SRA-2 SRA-2 EDSRA -2 SRA-3 SRA-3 DSRA -3 SRA-4 SRA-4 Maint Requirements Adjustments “Aged” Notionals • Automobile maint concept – older assets require increasing maint • Gradually increase the notionals as the vessel consumes service life • Basis for CVN Maint Op-cycle Mgt & availability resourcing levels • Easily understood by Pentagon programmers Under study

Programming Considerations • Meeting maintenance requirements since 2003 with baseline funding plus supplemental appropriations • How to transition out of supplementals yet still secure needed funding(?) • Fiscal policies of new administration…. • How is risk managed against shortfalls • Preserve industrial base vs. service life risk? • Phasing with major modernization programs • Full funding vs. timing of funding • Measurements tricky: • Near term effects and long-term effects

Execution Planning • Incremental improvements in MSMO Spiral 2 • MCIT replaces SHIPMAIN • Focused on avail planning & execution performance • What of “assessments”? • Re-institute shipboard assessments to facilitate avail planning • SSLCM: ICMP deploying BAWPs & AWPs • Expanding role of MFOM • Valuating lifecycle maintenance actions • Port-loading considerations (source of variation) • Technical requirements clarification & stabilization

Maintenance Execution • MSMO • Over-arching objective: stabilize MSMO • Permits contractor focus, commitment, repetition, improvement • Incremental improvements for MSMO Spiral 2 • Beneficial to Navy and industry • Comprehensive Contracting Strategy • Contracts Governance Process • Depot Work Integration

MSMO Results: Readiness vs. Maint Investment Start MSMO Navy initiates FRP Steaming days/yr/ship CNO Clark: “buy-down maint backlog” (2003) Large increase in steaming days/yr 2004-2008 (HOA, APS, POA, HADR, etc.) Increased steaming at same maint investment levels: MSMO enabling FRP

MSMO Results: Contract Performance • Cost: rates stable, affordable, and w/i programmed levels • Cumulative cost performance (thru FY08): ~ 4% cost under-run, all contracts, all performance periods • Schedule: response to current readiness exceptional – supports FRP • >200 CNO MSMO availabilities – 1 late due to contractor performance • Incorporation of change scope w/o sked impact significant (range 15-30%) • Technical performance solid & improving • Govt QA-point reject rate ~ 2% • Partnership: All MSMOs productively engaged in many Navy initiatives QA Reject trends 1st-order MSMO program objectives being met

MSMO Controls, Oversight, Governance MSMO success due to: • All contracts issued under proper Navy contract & technical warrants • Contract stability: focus, investment, process improvement • RMC exercising contractual authorities • DCAA periodic cost audits • Award fee evaluation boards – frequent feedback & accountability • Standing MSMO Acqn IPT providing dynamic review & adjustment • Rigorous oversight by ASN(RDA) • Balancing competition, performance incentives, stability • Approved additional contract strengthening in MSMO Spiral 2 (FY10-14) • Navy submitting report to Congressin FY10 Budget Request substantiating rationale for executing DDG Modernization w/ MSMO Many pieces contributing to overall program strength

Update: Comprehensive Contracting & Depot Work Integration Policy for Comprehensive Contracting and Depot Work Integration • Approved by ASN(RDA) 27 March 2009 • Enabling instructions & policies implemented JFMM Ch 7A (30 Jun 08) • Key elements/enablers • All work coincident to depot availabilities shall be planned, integrated and coordinated through the NSA using the LMA as the planning agent • LMAs shall have first opportunity to execute all depot work for which they have organic capability, capacity and cost reasonableness • Programs shall budget for reasonable depot installation costs • AITs shall execute AIT-unique work, and can execute depot installation work if the LMA does not meet the aforementioned requirements • NSAs shall remain the single authoritative voice to equitably resolve availability disputes and disruptions amongst all customers Policy successfully executed on several major CNO availabilities

Inclusive & balanced planning • End-to-end avail mgt • Single authority for conflict resolution Portfolio of Shipboard Production Contracts Contracts Governance Oversight Process Comprehensive Contracting & Depot Work IntegrationOverview Comprehensive Contracting & Depot Work Integration Comprehensive Contracting Strategy Maint, Modernization & AIT Integration Enablers: - 2004 FISC/SUP/Fleet/SEA/MOU - USFF 201411ZJUL06 - USFF 211431ZJUN07 - USFF 271300ZMAR08 - 30 June 2008 JFMM update - NAVSEA SEAPORT-e Policy - ASN Policy directive Enablers: - SY-AIT SWT 897-04 - 1 June 08 JFMM update - ASN Policy directive

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Surface Ship Maintenance Program brief for Virginia Ship Repair Association