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STATEMENT BY
THE HONORABLE CLAUDE M. BOLTON, JR.
ASSISTANT SECRETARY OF THE ARMY
(ACQUISITION, LOGISTICS AND TECHNOLOGY) AND
ARMY ACQUISITION EXECUTIVE

AND

GENERAL PAUL J. KERN
COMMANDING GENERAL
ARMY MATERIAL COMMAND

BEFORE THE
SUBCOMMITTEE ON TACTICAL AIR AND LAND FORCES
HOUSE ARMED SERVICE COMMITTEE
UNITED STATES HOUSE OF REPRESENTATIVES

MARCH 20, 2003   
  

INTRODUCTION

Mr. Chairman and distinguished members of the subcommittee, thank you for this opportunity to report to you on the Fiscal Year 2004 budget request and the Army's ground combat, combat support, and ammunition procurement programs and future technology initiatives.  It is our privilege to represent the Army leadership, the military and civilian members of the Army acquisition workforce, and the soldiers who rely on us to provide them with world-class weapons and equipment so they can successfully accomplish any mission at anytime, anywhere in the world. 

We thank members of this subcommittee for your strong support for the Army.  This is a time of tremendous change within the Army, and we are most grateful for your wisdom and guidance.  With your help, we will remain the most respected landpower to our friends and allies and the most feared ground force to those who would threaten the interests of the United States.  Your continued advice and support are vital to our continued success.

In October 1999, the Army unveiled its vision for the future - "Soldiers, on point for the Nation, transforming this, the most respected army in the world, into a strategically responsive force that is dominant across the full spectrum of operations."  The attacks against our Nation on September 11, 2001, and the ensuing war on terrorism, validate The Army's Vision - People, Readiness, Transformation - and our efforts to change quickly into a more responsive, deployable, agile, versatile, lethal, survivable, and sustainable force.

ARMY TRANSFORMATION

The Army Transformation is advancing along three major axes towards attainment of the Objective Force.  We selectively recapitalize and modernize today's capabilities to extend our overmatch in staying ready to defend our homeland, keep the peace in areas important to the Nation, and win the war against global terrorism.  Stryker Brigade Combat Teams - our Interim Force - will bridge the current operational gap between our rapidly-deployable light forces and our later-arriving heavy forces, paving the way for the arrival of the Objective Force.  By 2010, The Army's Objective Force - organized, equipped, and trained for ground dominance, cyber-warfare, and space exploitation - will provide the Nation the capabilities it must have to remain the global leader, the strongest economy in the world, and the most respected and feared military force.

In order to deliver to our soldiers the right capabilities at the right time, right place, and the right price, we are focusing our efforts in four key areas:  Programs, People, Production, and Improvement.

PROGRAMS

The acquisition process must begin with a solid statement of requirements.  The key body associated with determining those requirements is the Joint Requirements Oversight Council (JROC).  The JROC is an advisory council to the Chairman of the Joint Chiefs of Staff (CJCS).  In this capacity, the JROC reviews all warfighting deficiencies that may necessitate major defense acquisition programs and validates that such deficiencies cannot be satisfied by non-materiel means, e.g., changes in doctrine, tactics, training, or organization. Additionally, the JROC assists the CJCS in identifying and assessing the priority of joint military requirements, among existing and future major acquisition programs, to meet the National Military Strategy (NMS).  The JROC ensures that the assignment of such priorities conforms to and reflects resource levels as projected by the Secretary of Defense through the Defense Planning Guidance.  At the CJCS's direction, the JROC also evaluates alternatives to satisfying warfighting requirements by comparing the cost, schedule, and performance criteria of selected programs and identified alternatives. 

To accomplish these tasks, the JROC oversees a Joint Capabilities Integration and Determination System (formerly Requirements Generation System) which standardizes the analysis required for mission-need determination, validation, and approval prior to start of the acquisition process.   The JROC ensures that emerging performance objectives and thresholds adequately address the warfighting mission need and that the delivered capability and timing of that delivery are linked to the NMS. 

JROC actions on ground combat programs in the last three years include:  on February 23, 2000, the JROC approved the Mission Need Statement, approved the Operational Requirements Document, and validated the Key Performance Parameters for the Stryker; on January 23, 2003, the JROC approved the Future Combat Systems Mission Need Statement. 

Today's Army - our Legacy Force - guarantees both current warfighting readiness as well as the ability to transform successfully to the Objective Force.  This will remain the case for the next 15 years as the Army begins fielding the Objective Force units by the end of this decade and gradually transfers the mantle of readiness responsibility to these new units of action.  In order to preserve adequate operational readiness during this period, the Army must continue to invest sufficiently in its current force through a program of recapitalization and selective modernization.  These constrained investments are essential in order to ensure that the Army still retains military superiority during the Transformation process and likewise, reduces the increase in operating and support costs associated with aging weapon systems.

The Army is recapitalizing and selectively modernizing a portion of the current force, including the following programs:

The Abrams tank provides mobile protected firepower for battlefield superiority.  The Abrams tank closes with and destroys enemy forces on the integrated battlefield using mobility, firepower, and shock effect.  The 120mm main gun on the M1A1 and M1A2, combined with the powerful 1500 horsepower engine and special armor, make the Abrams tank particularly suitable for attacking or defending against large concentrations of heavy armor forces on a highly lethal battlefield.  Features of the M1A1 modernization program include increased armor protection; suspension improvements; and a nuclear, biological, and chemical protection system that increases survivability in a contaminated environment.  A modification consisting of an integrated appliqué computer and a far-target-designation capability can be incorporated on the tank.

The M1A2 modernization program includes a commander's independent thermal viewer, an improved commander's weapon station, position navigation equipment, a distributed data and power architecture, an embedded diagnostic system and improved fire control system.  The M1A2 System Enhancement Program (SEP) adds second-generation thermal sensors and a thermal management system.  The SEP includes upgrades to processors/memory that enable the M1A2 to use the Army's common command and control software, enabling the rapid transfer of digital situational data and overlays.  The Abrams modernization strategy also includes a new engine program, the Abrams Integrated Management (AIM) Overhaul Program, and parts obsolescence program, which will reduce the operational and support costs and logistical footprint associated with the Abrams.

In FY03, M1A2 SEP production continues.  The Army's M1A2 SEP fleet requirement is 588 vehicles.  In FY03 the fielding of M1A2SEPs to 1^st Cavalry Division in Fort Hood, Texas, continues.

Abrams and Bradley fight as a team, and the mission is to maintain combat overmatch.  The Bradley fighting vehicle is being upgraded to provide infantry (M2A3) and cavalry (M3A3) fighting vehicles with digital command and control capabilities, as well as significantly increased situational awareness, enhanced lethality, survivability, and improved sustainability and supportability.

The Bradley M3A3 is a significant step forward for the infantry force because it is the first version of the Bradley that will be technologically equal to the Abrams M1A2 SEP tank.  Some of the enhanced capabilities of the A3 include:  digital command and control; Second Generation Forward Looking Infrared; Commander's Independent Viewer, Squad Leader's Display; Improved Bradley Acquisition Systems; and an integrated position navigation system.

The Army's recapitalization and selective modernization of the Legacy Force focuses primarily on those systems that will not only benefit the warfighter today, but will have a direct applicability to the Objective Force over the longer term.  Modernization has two major components:

The first component is those systems that are a part of the near-term Legacy Force and will transition to the Objective Force, such as the Family of Medium Tactical Vehicles (FMTV).  FMTV is a family of diesel-powered trucks in the 2-½ ton and 5 ton payload classes to modernize and improve the existing medium vehicle fleet.  The second component is the systems being built specifically for the Objective Force but that can be employed today such as the Tactical Unmanned Aerial Vehicles, which the Army's Program Executive Officer for Aviation, Major General Joseph L. Bergantz, covered in his testimony to this subcommittee last week. 

Ultimately, the Army will have a common organizational design for all components - Active, Guard, and Reserve - built around a new generation of systems that are deployable on C-130-like aircraft, with optimum development on C-17 aircraft and fast sealift.  The result will be a more strategically responsive Army that is more capable of dominance along the full spectrum of military operations.

The Interim Force is based on the foundation of Stryker Brigade Combat Teams (SBCT) equipped with a family of Stryker armored vehicles, lightweight artillery, and other available advanced technology.  This technology will include Land Warrior Soldier Systems that will be integrated into SBCTs and significantly enhance the common situational awareness for soldiers.

Stryker provides the primary combat and combat support platform of SBCTs to enable a strategically deployable (C-17/C-5) and operationally deployable (C-130) brigade capable of rapid movement anywhere on the globe in a combat-ready configuration.  Stryker supports the Army Vision and Transformation and fulfills an immediate requirement with equipment that is highly deployable, lethal, survivable, mobile, and reliable. 

The Stryker family of vehicles consists of two variants:  the Infantry Carrier Vehicle (ICV) and the Mobile Gun System (MGS).  The ICV is a troop transport vehicle capable of carrying nine infantry soldiers, their equipment, and a crew of two consisting of a driver and vehicle commander.  The MGS is designed to support infantry.  It incorporates a 105mm turreted gun and autoloader system designed to defeat bunkers and breach double-reinforced concrete walls.  There are eight other configurations based on the ICV that provide combat and combat support capabilities.  These are the Reconnaissance Vehicle (RV), Mortar Carrier (MC), Commander's Vehicle (CV), Fire Support Vehicle (FSV), Engineer Squad Vehicle (ESV), Medical Evacuation Vehicle (MEV), Anti-Tank Guided Missile vehicle (ATGM), and Nuclear, Biological and Chemical Reconnaissance Vehicle (NBCRV).

Each SBCT requires 330 Strykers.  The current program acquires 2,121 Strykers to field six SBCTs, one of which will be configured as a cavalry regiment.  The first SBCT at Fort Lewis, Washington, will achieve initial operational capability in the third quarter of Fiscal Year 2003.

The Objective Force is the Army's main effort and ultimate Transformation goal.  It is the future force that will achieve the characteristics described in the Army Vision - responsiveness, agility, deployability, versatility, lethality, survivability, and sustainability - and will be capable of dominating at every point of the spectrum of operations.  The key to Transformation to the Objective Force is the Future Combat Systems (FCS).  FCS, the Army's top priority S&T program, will be a multi-functional, multi-mission, reconfigurable system-of-systems designed to maximize joint interoperability; strategic and tactical transportability; and integration of mission capabilities, including direct and indirect fire, reconnaissance, troop transport, countermobility, nonlethal effects and secure, reliable communications.  FCS will provide these advanced warfighting capabilities while significantly reducing logistics demands. 

Approximately one-third of the Army's S&T investment is focused on technologies for FCS.  The S&T program has been shaped to pursue future technology options for FCS with the capability to incorporate, over time, these advances through spiral developments.  The initial version of FCS will be designed to provide certain threshold capabilities.  Subsequent versions will have increased functionality to achieve Objective Force full spectrum capabilities.  Operational versatility will be realized using an open-architecture system concept, with a design approach that can be readily upgraded and tailored to enable the system-of-systems to perform different missions as needed.

Other systems of critical importance to the Objective Force include the RAH-66 Comanche helicopter, the Joint Tactical Radio System (JTRS), and the Warfighter Information Network - Tactical (WIN-T).  As Major General Bergantz told this subcommittee last week, Comanche is a multi-role helicopter for the Objective Force that will be capable of executing a range of missions in support of close combat, vertical maneuver, and mobile strike operations.  JTRS is the next generation tactical radio that will provide secure, multi-band, multi-mode software programmable digital radios for the electronic transport of emerging and anticipated warfighter command and control requirements.  WIN-T is the integrated high-speed and high capacity communications network for the Objective Force.  FCS, Joint Tactical Radio System, satellite terminals and other Department of Defense (DoD) Command, Control, Communications, Computer, Intelligence, Surveillance, and Reconnaissance (C4ISR) programs will rely on WIN-T for seamless integration into the DoD Global Information Grid.

PEOPLE

Within the next two to four years, 50 percent of the Army acquisition workforce will be eligible to retire.  About one-third of the Army's civilian population is eligible for retirement today.  The skills and abilities that the Army will need to replace this aging workforce are very different from the mix of skills we currently have.  In addition, a dozen years of downsizing the Army's civilian workforce has created huge gaps in selected occupational sectors that cannot be filled easily. 

It is inevitable that our future workforce will be smaller.  Our goal is to design an acquisition workforce that will, with fewer people, continue to provide our soldiers with world-class weapon systems and equipment.  We will always need a smart, motivated work force that operates in a continuous learning environment.  Competition for the most talented people - many with hard science degrees and other high credentials - will be especially keen. 

PRODUCTION

The health of the defense industrial base is key to the Army's ability to continue to provide innovative technology and technologically excellent systems and equipment at favorable and competitive prices.  Production is primarily dependent on the privately-owned network of prime contractors and subcontractors.  The Army also retains a few industrial facilities that are owned and sometimes operated by Army civilians, e.g., our ammunition plants and arsenals.  We would like to highlight some of the critical issues affecting the Army today.               

The major issue is limited contractor competition and overhead rate increases.  Business for primes has been dwindling as we bought fewer systems over the past five years and instead focused on the modifications.  Modifying existing systems and equipment usually involves a sole source negotiation with the original equipment manufacturer.  Our options are limited because we cannot afford to miss out on important advancements or risk losing industrial suppliers critical to sustainment of our fielded systems.  The result is that programs are being faced with increased costs and limited competition.  At the same time, the industry is consolidating.  We have a few very large prime contractors who sometimes also buy critical subcontractors.  We encourage competition during acquisition planning to the maximum extent possible.  To guard against over consolidation, we review proposed mergers and acquisitions as part of the governments antitrust review process, led by the Department of Justice and the Federal Trade Commission. 

Another concern is availability of obsolescent parts, primarily within legacy systems.  This is aggravated by limiting the use of military specifications and standards in favor of a greater reliance on commercial items.  However, the rapid and constant change in commercial technology has accelerated obsolescence problems in several systems when viewed from the life cycle of a major weapon system.  Development efforts must anticipate and include provisions for planned technology upgrades, therein requiring a continual infusion of research and development funding into fielded systems.  Production planning must include some degree of life buys and obsolete component replacements. 

Another concern is lower production levels. At lower volumes of production/remanufacturing, the manufacturer cannot effectively maintain a large work force.  This usually results in many older workers retiring as production staff decreases.  With this, we lose their skills and the available work force is challenged in its ability to meet priority surge production.

It is clear that the defense industrial base of the 21^st Century will consist of a complementary and synergistic mix of private sector and government capabilities.  By leveraging the private sector's capabilities to the maximum extent practicable and economical, the Army will focus its resources on those manufacturing processes and products unique to the national security mission.  The challenge is to determine what organic capability to retain and the most efficient organic capacity.

The Army recognizes the need for transformation of the organic industrial base and has directed the implementation of initiatives to improve efficiencies and maximize utilization.  One of the most promising approaches to fuller utilization of the organic base is through public-private partnerships. 

The current Army organic industrial base consists of facilities that produce ammunition, manufacture components, and maintain equipment.  The facilities, located throughout the continental United States, consist of Government-Owned, Government Operated (GOGO) and Government-Owned, Contractor Operated (GOCO) facilities.  The Army owns all of these facilities; however, Army employees manage and operate the GOGOs.  Private companies manage and operate the GOCOs.

GOCO and GOGO ammunition facilities:  At these facilities, the Army produces, loads, assembles, and packs the various calibers of conventional ammunition such as small arms, mortar, and tank rounds used by all the military services. 

GOGO weapons manufacturing arsenals:  Rock Island and Watervliet produce items such as gun tubes, gun mounts, and other armament components for the Army, Navy, and Marine Corps, as well as Foreign Military Sales.

GOGO maintenance depots repair:  These five facilities overhaul, upgrade and maintain helicopters, missiles, combat vehicles, tactical vehicles, and communication and electronic equipment for all the Services and other countries, as well.

The Army has undertaken initiatives to maximize utilization of organic plant capacity and to improve efficiencies.  Regarding the GOGO and GOCO ammunition facilities, the Army is moving to right size the capacity.  The strategy addresses integration and consolidation, divestiture, leasing arrangements as appropriate, and affordability.

Regarding the GOGO manufacturing arsenals, the Army determined that their integration into the Army's Ground Systems Industrial Enterprise (GSIE) initiative, along with ground support maintenance depots, is both feasible and viable. 

Regarding the GOGO maintenance depots, the Army is committed to adhere to the statutory requirements for facilitizing Army maintenance depots to meet core logistics requirements, establishing a more effective and efficient depot level operation, enhancing productivity of its core capabilities, integrating innovative business processes, utilizing that facilitized capability, and fully supporting the partnership opportunities provided by designation of Army Centers of Industrial and Technical Excellence.  The Army will continue to partner with the private sector and improve efficiencies.    

IMPROVEMENT

We must constantly work to improve conditions in all of the areas that we have discussed, and institutionalize our process improvements.

With each success, the real winner is the American soldier.  We are here to serve the soldier on point for our Nation.  We know firsthand that the most technologically advanced platforms - all the weapons in the world - are useless without the intellect, dedication, and remarkable sense of duty of our soldiers.  They are the centerpiece of our formations.  We all have an important role in the Army's transformation to the Objective Force.  People will make it a success.  People will make the difference.  We will succeed as a team, and each of us has an important role.