Procurement Of Tactical Aircraft AUTHOR Major Mark W. Kurtzhalts, USMC CSC 1991 SUBJECT AREA - Aviation EXECUTIVE SUMMARY TITLE: PROCUREMENT OF TACTICAL AIRCRAFT I. Purpose: Because of personal frustrations of trying to affect minor changes in the F/A-18 and due to inadequate planning and execution, the loss of a needed weapon system, I wanted to know what made the process so hard. The research uncovered a lot of variables within the equation. II. Problem: Administration, political and industrial influences cause inconsistences. Interservice as well as intraservice rivalries generate planning problems. III. Data: The Department of Defense goals established to raise the visibility of industrial base issues at all levels within DoD. The United States must preserve for the future generation the margin of technological superiority it enjoys today. The DoD must be prepared to facilitate the rapid exploitation of technology to meet a crisis situation. To do this, the Secretary of Defense has directed focus on two points, streamlining the industrial base management and practices, and promoting key defense product and manufacturing process technologies. These technology programs will provide options for strategies, tactics, and operations required to carry a successful national security program in a world filled with uncertainties. IV. Conclusion: Development of advanced weapon systems is political and emotional as well as scientific. V. Recommendations: In order to meet these goals established by the Secretary of Defense, some changes in well established trends will need to be accomplished. One change that is a must is to make the DoD personnel responsible for the development and procurement more career oriented. Then they would understand the extensive and complex regulations, preventing mistakes managing contracting and procurement. Some priorities must be set in maintaining the military industrial base at an adequate minimum level in the presence of a decreasing defense budget. Individual services will have to wake up to the fact that they will have to develop weapon systems jointly in order to be able to afford the technology required to survive todays and tomorrows threats. PROCUREMENT OF TACTICAL AIRCRAFT OUTLINE Thesis Statement. A number of definite changes with the development and procurement process throughout the Department of Defense (DoD) will be required if the armed services are going to acquire aircraft with the best available technology with in a decreasing defense budget. I. Review of Department of Defense Procurement Process A. General Characteristics of the System 1. Risk Management 2. Funding Instability 3. Transitional Leadership Billets within DoD B. The Military Industrial Complex 1. Survival in an Austere Defense Budget Environment 2. Regulations Affecting Contracting 3. Political Influence C. Contract and Development 1. Fixed-priced vs. Cost-plus 2. A-12 Cancellation II. The Armed Services A. Planning B. Interservice Rivalry and Joint Development PROCUREMENT OF TACTICAL AIRCRAFT There is a constant need to upgrade our weapon systems that are used in the defense of our nation and it's strategies. A number of definite changes with the development and procurement process thoughout the Department of Defense (DoD) will be required if the armed services are going to acquire aircraft with the best available technology within a decreasing defense budget. We must understand the acquisition process and some of the problems prior to understanding the procurement of a weapon system. Another way to state this is how we ended up with what we got, like it or not. Many pages have been written establishing policies and procedures for acquisition as well as laws for competition and contracting. The U.S. defense acquisition methodology has several characteristics or flaws. The first characteristic is that defense acquisition is fundamentally a business of risk management. The U.S. has won the Cold War if by one reason, it produced superior weapon systems. Although more expensive per like weapon system, it eliminated the need to match the numbers the Soviets were producing. Because of the quality of our weapon systems, we could fight outnumbered and win. The risk is a matter of weighing the technical challenge, providing a sensible plan to reduce risk and demonstrate technical achievement before making major commitments to a predictable schedule. (8:28) This process has produced the world's most capable combat systems. There's nothing in the commercial industry that comes near to it. Trying to compare the development of a commercial airliner to the development of an F/A-18, A-12 or a B-2 is meaningless. Another characteristic of defense acquisition is funding instability. If a commercial industry takes on a new development, the commitment is for sustained multi-year funding. The DoD and Congress operate on an annual funding basis. This, combined with having two-year Congresses and four-year administrations make the instability obvious. Still another characteristic is the transitional nature of the DoD leadership and decision makers. Most of the people who come into jobs in the DoD leave after a few years to go to industry, service companies or law firms. For the past three undersecretaries of defense for acquisition, the average length of service has been a little more than a year. There is no way that, in one year, someone coming in cold can possibly grasp the complex nature of defense acquisition process and procedures. Because the turnover is frequent, there is no depth or continuity in policy, nor corporate knowledge in the DoD management on policy, directives, and regulations. Defense acquisition is a political process first and a managerial process second. General Skantze recommended that: While the United States needs a strong, experienced team of DoD acquisition leaders who can enforce a steady, experienced, and disciplined management philosophy, it is not clear that it can be achieved given the political nature of the process. One option in the acquisition field could be to make the key jobs career professionals rather than statutory positions. (8:28) A factor influencing the procurement of tactical aircraft equation is the companies of the military industrial complex. This also has a political base. The Office of Federal Procurement Policy Act of 1974 developed the Federal Acquisition Regulations (FAR) which identify requirements with which a company of business must comply in order to contract with the government. It also lays the ground rules in which the government must comply with in the acquisition process. In order to regulate the awarding of contracts, Congress passed the Competition in Contracting Act of 1984. It was to promote full and open competition in soliciting offers and awarding government contracts. In a review of some of these procedures, Major Arms concluded that: Although the objective of the United States' military procurement policy should be the direct support of national military strategy, in reality it is governed and dictated by domestic business policies and interests.(1:7) An example of this political/business influence is the New York based Grumman Corporation. They were the builders of the A-6, E-2 and the F-14, all which have reached the end of their procurement contract. The Secretary of Defense, Dick Cheney, canceled the F-14D production in mid-March. Following an intense lobbying campaign, Congress has just forced the DoD to release funding for the building of 12 more F-l4Ds. This brings up several other sub problems. One is keeping corporations from going under. Second, the DoD and the individual services, need to establish clear goals and objectives for future aircraft requirements. This is a must for the U.S. Navy in light of the cancellation of the A-12, a carrier based, stealth, attack aircraft. Thirdly, the funding for an aircraft such as the A-12 development should never have been fixed-price contract. The United States has maintained a large military industrial complex since World War II. The bad news is that the Defense Budget and hence the defense industrial base is shrinking and will continue to shrink regardless of the war in Southwest Asia. Fifteen years ago, there was enough business to go around. Today, with the cancellation of the A-12, there is only one airframe start available for competition in development and production. This is the Advanced Tactical Fighter (ATF), a stealth fighter. Some companies have diversified their products in order to survive. For the first time, military aircraft companies are teaming up as for the example of Northrop/McDonnell Douglas and Lockheed/General Dynamics/Boeing for the ATF contract bid. Is there a need to protect the military industrial base? Part 6 of the FAR covers the awarding of contracts to keep suppliers in business in the event of a national emergency. Some companies are looking to foreign military sales in order to keep production lines open. To prevent the Fighting Falcon production line at General Dynamics from shutting down before the USAF is ready to begin it's Multirole Fighter (MRF) program, Air Force officials have undertaken an increasingly active role in supporting company efforts to sell the F-16 to foreign allies. The USAF has not been actively promoting its own products. It's because they thought the F-16 basically sold itself. Now they've begun to recognize that foreign military sales are going to be supportive of the industrial base as well as of the USAF's own force structure. How many aircraft companies do we need? How do we preserve the engineering skills and corporate knowledge to design viable weapon systems for the future? Not only is the defense industrial base affected by the decreasing defense budget, but so are the local economies. California has set aside $7 million for the first six months of a program to sway defense contractors to establish or maintain their businesses within that state. The cancellation of the A-12 contract has affected the economies at both Fort Worth, Texas (General Dynamics) and St. Louis, Missouri (McDonnell Douglas) with over 4000 layoffs. This does not include the many subcontractors throughout the country. Proper contracting could have prevented this. There are two types of development contracts, fixed-price and cost-plus. With the latter, the government pays all legally allowable costs the contractor incurs during the life of the contract. With fixed-price agreement, the contractor and the Government agree on a target cost. Any deviation between this amount and the actual cost may be borne entirely by that contractor or shared in some predetermined proportion with the Government. Recently, the A-12 fixed-price development contract came home to roost with great consternation as to why the DoD allowed such a contract for such a high-risk program. It was not lack of sensible DoD procurement policy. The policies and regulations clearly spell out where fixed-price and cost-plus type contracts are applicable. However, the pervading environment in the mid-1980s was "hold their feet to the fire." Fixed-price development contracts with contractors up-front investment had an aura of doing just that. It sounded like a free lunch and both sides seemed enthusiastic. A little corporate knowledge would have revealed that in the mid-l97Os, Joseph Gavin, the chairman of Grumman Aircraft, declared he would refuse to accept an existing F-14 fixed-price production option from the Navy because financially the corporation could not survive it. The A-12 contract proved once again that a fixed-price contract, even funded to the ceiling, does not protect the Government. (8:28) Having a well thought out acquisition plan looking well into the future is essential. Part of U.S. Naval aviation's current difficulties can be attributed to poor planning in having so many different aircraft programs competing for funding in an austere budget environment. With the exception of a couple of squadrons worth of F-14Ds, the Navy has spent billions of dollars of development funds on the A-12, P-7A and the A-6F with no end product to show for it. The Navy also withdrew from the ATF program and now has no viable replacement for the aging F-14. The operational requirement for the AX, a possible alternative for the A-12, has not been written yet. This aircraft could not be operational before the year 2005. The Navy needs to replace 5,000 aircraft in the next 20 years.(6:25) It needs to take a long, hard look at what the airwing is going to look like considering the present and future threat. This will have to be done knowing that the numbers and diversities of aircraft on board are going to be reduced, so their capabilities can not be limited. At the risk of over simplifying matters and not to down play the unmatched skill of a Naval Avaitor, there are a lot of similarities between USAF and USN tactical missions. The major difference, which has already been eluded to, is that the Navy operates off of aircraft carriers. This is a great advantage over land based aircraft when there are no airfields to operate from, as there were in the Southwest Asian War. However, the missions are essentially the same. Maritime Air Superiority is the same as Vital Area Defense, Air Superiority is Air Superiority, War at Sea or Strike is equivalent to attacking a well defended, high valued target. The only major difference in aircraft should be the structural and performance capability for ship board operations. Mission specific idiosyncrasies can be handled by simple software modifications. This has been done in the past. The F-4 Phantom II was the most successful and hence, prolific fighter/attack aircraft ever built. It was successfully employed by the USAF, USN and USMC for many years as well as many other foreign air forces. Another effort, the VFX, was not a total success. The USAF ended up with the F-111 and the USN dropped its version to opt for the F-14, in which had a lot of VFX technology. Both derivatives were neither amazing success stories; there weren't many success stories out of the MacNamara era. Well into the 1990's and beyond, U.S. tactical aircraft will have to be smaller, less varied, more versatile and cost effective in order to meet the DoD force reduction requirements. Colonel Brinkley summed up basic requirements for fighter aircraft by stating: From the perspective of the pilots who will fly U.S. air superiority fighters in future combat, two essential requirements must be met. The fighter must be stealthy enough to operate below the detection thresholds of air defense radars and weapons. In the visual combat arena, the fighter must have the performance, agility, and weapons necessary to defeat the next generation Soviet fighter. (2:49) If there is going to be a consolidation of missions into one aircraft in order to reduce the cost of buying and developing two separate aircraft, the weapons system must be modifiable. The F/A-18 set the standard in this field. It was the first aircraft developed that tactical fixed wing pilots designed the cockpit, not engineers. It has programmable flight control and weapon system computers. This made it the most maneuverable aircraft with a user friendly cockpit and weapon system employment. However, it lacks stealth technology. The Secretary of Defense, in reference to the Persian Gulf conflict, stated: We simply could not have done what we have done as effectively and as efficiently and as low a cost to life, both ours and the enemy's, if we had not had that stealth capability. (3:10) A technological concept costs a lot of money to bring to practical use. This is the research and development cost. If you don't buy a lot of airplanes, the R&D cost as a percentage of production gets into very large numbers, well into the double digits. The cost is infinite if you only buy a couple of airplanes. Stealth is a good example. The F-117A, of which only 59 were bought, had a flyaway cost of $42.6-million. To oversimplify, The F-117A might be viewed as an invisible, much longer range, night attack version of the F-16, whose fly-away cost in that era was roughly $13-million and well over 2000 were sold. Although the F-16 has low observable technology vice stealth, it has much greater maneuverability and the capability to employ air-to-air weapons as well as air-to-ground. The performance of the U.S. aircraft being able to gain and maintain air superiority in a short time, against what was determined to be a very sophisticated air defense of Iraq, will fuel the political argument that the technological quality of the present air forces is adequate. A reader of Defense Journal put the acquisition of adequate weapon systems in stronger terms: Personally, I consider air superiority fighters in exactly the same context as my pistols: when the gunfight starts, I want the very best; `cause when it's over there will be no second place silver medal - only me and the dead bastard who picked the fight. (7:48) It can only be the self-serving interests of the two major air services that prevent the progressive development of tactical aircraft. The ATF was developed with a carrier capable derivative. It was dropped by the USN very late in the program. Was it by parochial or political pressures for maintaining the production line open for the F-14D? That airframe is mid-1960s technology! The Navy is well behind in having any low observables or stealth in its airwings. The USAF had the F-16 operational in the late 1970s and the F-117 in 1984. The USAF, who showed weak interest in the A-12 program, was only too glad to see it cancelled in order for them to pursue the MRF. The only warriors that actually seek interoperability are the junior officers whom are constantly exchanging information and ideas on tactics and software between fellow pilots of the other services. No one service has the market cornered on good ideas. Perhaps the development and establishing the operational requirements and military specifications of tactical aircraft should be left to senior O-3s or junior 0-4s. Require these officers to be past graduates of Fighter Weapons School (USN Top Gun or USAF), Weapons and Tactics Instructor (WTI) or Strike Leaders Advanced Tactics School (SLATS). These individuals will be the squadron commanders when the aircraft becomes operational and will have to live, or die, with it. If you were to visit the McDonnell Douglas aircraft plant at St. Louis, you would see the F-15, F/A-18 and the AV-8B being made. These three aircraft are moving down the assembly line not more than a few feet apartg wing tip to wing tip. It is easier to get technology transfer from the Soviet Union than it is from the F-15 to the F/A-18. A simple software exchange in the radar tape that would increase the aircraft survivability normally takes three years. It is even more difficult exchanging ideas from aircraft of different manufacturers. This is all well and good if you don't have to use it in a hostile environment in the interim. Imagine the amount of money the DoD could save if the services could develop suitable aircraft on a joint basis. The commonality of parts and support equipment would reduce the stockpile in warehouses supporting such a diversity of aircraft. It would also eliminate the large number of aircraft specific (Mil Spec) tools that cost so much. The development of software could be expedited enhancing the aircraft survivability, performance and interoperability in the joint theater. The Chief of Naval Operations (CNO) stated that: "As the U.S. forces get smaller, we're going to be doing more together, jointly."(4) This will have to work for the acquisition process as well as operationally. This is somewhat of a simplistic view of weapon systems procurement considering the thousands of pages of legislation written just to regulate it. The personalities of the administration, Congress and industry influence this complex process. Making this bureaucratic process more efficient and eliminating some of the emotional parochial obstacles will produce better aircraft, in less time and more cost effective. "Remember, your weapon system was built by the lowest bidder. "(5) BIBLIOGRAPHY 1. Arms, L.D. Majors USMC. "The Dangerous Deception: The True Meaning and Ends of Military Procurement." USMC Command and Staff College, Quantico, October 1990. 2. Brinkley, Randolph H., Col, USMC(Ret). "Future US Fighters are at a Cost/Technology Crossroad. "Armed Forces Journal International, January 1991, 49. 3. Finnegan, P., "War Emphasizes Stealth Need, Says Cheney."Defense News, February 11. 1991,10 4. Kelso, Frank B., Admiral, USN. Address given to the USMC Command and Staff College, Quantico, Virgina,February 11, 1991. 5. Murphys Law of Combat 6. "Navy Faces aircraft Funding Predicament." Defense News, March 25, 1991,60. 7. Schemmer, Benjamin J., "Will Stealth Backfire?"Armed Forces Journal International, January 1991,48. 8. Skantze, Larry., Gen. USAF (Ret) "Acquistion Lacks steady Hand. "Defense News, February 18, 1991,28.
