The Increase and Decrease

Written by Peter Buxbaum

MLF 2011 Volume: 5 Issue: 10 (November/December)

Life cycle management is a methodology that seeks to efficiently deliver and maintain military systems and platforms over a period that can stretch over years and decades and—especially in these times—within the constraints of tight budgets.

While life cycle management has been a recognized process within both the military and private sectors for some years, some argue that it is honored more in the breach than in the observance in military circles. One reason system and platform costs sometimes balloon out of control has been the failure to plan for life cycle costs. Operations and maintenance often consume 75 percent of the lifetime costs of military vehicles. But the planning emphasis is often on the acquisition costs, the other 25 percent.

The prospect of significant cuts to the defense budget has placed a greater emphasis on the cost control aspects of life cycle management. This process begins in the planning phases of a product with a focus on designing for affordability, rather than capabilities, and an emphasis on high reliability, which reduces the lifetime costs of a product. Recapitalization and resetting of platforms extends their useful life and reduces overall costs. Building fuel efficiency and environmental friendliness likewise reduces life cycle logistics costs.

The practice of life cycle management may ultimately be heading toward a penetrating analysis and understanding of all the costs associated with the ownership of a system. Achieving that level requires changes in how the subject is approached, perhaps even a merger of early stage processes and organizations, such as procurement and acquisition, with later stages of the life cycle such as maintenance and repairs.

“Life cycle management starts with the conception of the design of a product, producing it and sustaining it throughout its life, and then disposing it,” said Jim Beggs, senior associate at the government contractor Booz Allen Hamilton. “The purpose of the life cycle management process is to figure out a way to provide overall performance that will meet user requirements and to do it optimally.”

Optimizing performance and efficiency over the lifetime of a system or platform involves streamlining the logistics tail associated with the operations and maintenance of the platform. “We review a design from a logistics perspective,” said Bob Cursio, director of logistics for battle management systems at General Dynamics C4 Systems. “We examine whether the parts are designed for usability and whether the hardware and software components are right for the configuration of the vehicle and the supply chain that goes with it.”

“The challenge,” said Charlie Fletcher, senior manager of the Strategic Operations Group at Alion Science and Technology Corporation, “is how make things perform at high reliability to meet mission needs while making it affordable through its life cycle from conception through design and manufacture.”

Reducing overall life cycle costs means considering the eventual maintenance costs from the beginning. “We try to minimize life cycle support services and reduce maintenance levels on pieces of equipment that we produce,” said Mike Stolarz, vice president for business development at HDT Engineered Technologies.

Budgetary pressures mean that military services will likely require longer useful life spans from their acquisitions, making up-front reliability and economical sustainment all the more important, according to Heath Patrick, vice president for defense and space at Honeywell. “We have seen many new startups over the last 10 years in lieu of maintaining or improving an existing system,” he said. “We have also seen user requests for RMUs [retrofits modifications upgrades] that simply add features. Sometimes it doesn’t help with affordability but instead adds features that are nice to have.

“With the budget pressure, we are seeing more new start programs pushed to the right or canceled altogether,” Patrick added. “Over the next five or 10 years users will not be looking for the faster and sleekest version of things but products that are good enough, so long as they meet the warfighter’s needs and enable the sustainment of existing equipment and reducing current fleet degraders.”

Increased life spans mean higher levels of reliability built into equipment. That, noted Fletcher, could build in higher up-front costs for systems but also higher maintenance and sustainment costs over the longer life span. “In the last 10 years there has been an increasing recognition of the costs incurred in the field,” he said. “These have to be better understood in the development of capabilities. This also involves creating a much closer marriage between acquisitions and logistics.”

Higher development costs and higher maintenance costs could mean that certain capabilities simply cannot be built, according to Fletcher. But Beggs noted that there are several ways to wring costs out of equipment life cycles.

“In the past, the military has responded to budget cuts by cutting training and discretionary spending and living through that until times got better,” he said. “But the current environment may require a step-change in how the military approaches these issues. We are entering an era where budget cuts will likely be dramatic.”

Three routine approaches to cost cutting during times of tight budgets, according to Beggs, include cutting around the edges of programs, buying less equipment or fewer systems, and trying to cut into the profitability of vendors “by negotiating more fiercely.” “The government will stress price competitiveness on the delivery of equipment,” he explained.

A fourth and more profound effort to streamline life cycle costs revolves around reorienting the entire enterprise and examining how functional areas such as acquisitions, maintenance and logistics relate to each other. “This involves performing a base line analysis of how you do business, how lines of authority are working and gaining a clear understanding of where and how costs are incurred,” said Beggs.

Designing for affordability as opposed to designing for capabilities could be the result of such a penetrating analysis. While military organizations have yet to embrace this process in a meaningful way, private organizations already have.

The design and delivery of the Virginia class submarine by General Dynamics is one example of where such a penetrating analysis worked. After having been informed by the Navy that it would be buying fewer vessels at the then-current costs of $2.5 billion a piece, General Dynamics was able to remove $500 million in costs from each unit allowing to Navy to maintain its original acquisition level.

“What they did,” said Beggs, “was to make sure the submarines continued to meet operational requirements while making it less expensive to build and maintain. They did this by performing a detailed cost analysis to understand component costs and to prioritize them.”

“Honeywell focuses on overall life cycle management with our defense customers by focusing on overall safety, reliability, sustainability and affordability,” said Patrick. “We focus on designing and developing highly reliable, fuel efficient and powerful products that to meet the warfighter’s needs. We also look at products that can increase the overall life cycle of a platform or system.”

RMUs, recapitalizations and refurbishment of military platforms extend their life and are likely to become more prevalent as the military requires additional years out of its investments. “We work closely with the operators to understand what their pain points are,” said Patrick, “and from that discussion and analysis, we develop an RMU that addresses their needs by making the product more fuelefficient, more powerful and enabling the system to operate more effectively.”

Honeywell performed such a process for the U.S. Air Force in the case of the F15 fighter jet. “Failures were resulting in a highly unusual abort rate,” said Patrick. “Analysis showed the number of failures that were occurring within the secondary power system. We came to the conclusion that it was a switch problem and the integration of the wiring with the aircraft.”

Honeywell then developed an RMU solution. “We were able to quantify dollars and cents that the Air Force could save by using our RMU,” said Patrick. “The success comes by drilling down to identify critical needs and mission degraders and showing the customer the exact dollars and cents that it is costing them. In the case of the F-15 secondary power system, some of the aircrafts were used by student pilots and we calculated how much it cost them when these students were not in the air. Altogether, we were able to show the Air Force substantial maintenance and operational savings, which resulted in them funding this critical RMU.”

Oshkosh Defense has been active in recapitalizing military vehicles, including the Palletized Load System and Heavy Expanded Mobility Tactical Truck (HEMTT). In the case of HEMTT, Oshkosh upgrades A0 and A2 configurations of the vehicle to the currently manufactured A4 variant, a process that includes installing improved suspension systems, an air-conditioned and armor-ready cab, and a more powerful drive train.

“Oshkosh Defense vehicles have such a long operational life that they often outlive their original technology,” said Mike Ivy, vice president and general manager for Army Programs at Oshkosh Defense. “That’s why Oshkosh also offers recapitalization and retrofit services.”

The Oshkosh recap process is more than simply replacing a few components that have reached the end of their useful life. “Vehicles can be torn down to the frame rails and stripped of any old paint, rust or corrosion,” Ivy explained. “Worn parts are replaced and the vehicle is refitted with the latest technology, ensuring top performance from the recapitalized vehicle. Recapitalized vehicles are dialed back to zero hours and zero miles and come with a new vehicle warranty.”

Under the HEMTT recapitalization contract, Oshkosh integrates engine and transmission upgrades, new armored cabs, LED marker lights, two-piece wheels, and air-ride seats. Cargo bodies, cranes and fifth wheels are also overhauled. The tires and all electronics are replaced with new parts. The vehicles are reassembled on the same integrated vehicle assembly line as a new truck. By weight, 97 percent of the vehicle is reused. Recapped vehicles cost an average of 15 percent less than new Oshkosh vehicles, according to Ivy.

Oshkosh Defense also participates in the Army’s Theater-Provided Equipment Refurbishment (TPER) program, which restores battle-damaged and heavily worn vehicles from the Army’s family of heavy tactical vehicles (FHTV) and line-haul fleets to the military’s equipment readiness standards so they can be returned to the field. Oshkosh has refurbished 1,850 FHTV trucks and 460 line-haul trucks for a total of 2,310 vehicles under the program.

“The TPER program eliminates the cost of shipping vehicles to the U.S. for repairs and returns the trucks to soldiers stationed in-theater more quickly,” said Jeff Koga, Oshkosh Defense senior director of Integrated Product Support. “The TPER program allows us to significantly reduce the cost of refurbishing the Army’s vehicles, and cuts maintenance cycle time by at least 60 days compared to U.S.-based repairs.”

HDT supports life cycle management by integrating green technologies into the shelters, heaters, generators, pumps and filters it provides the U.S. military. “Environmentally-friendly technologies help reduce the logistics tail associated with the operation of these products by reducing things like fuel consumption and waste water production,” said Stolarz. “Thermal barriers that go on our shelters reduce heater run times. They are the greatest consumer of fuel in some base camps.”

Fuel efficiency and environmental friendliness are also part of the life cycle management contribution made by Honeywell, according to Patrick. “We design products to help the customer fly straighter, more efficient routes to systems to engines that are lighter and integrate software that minimize fuel burn,” he said. “Honeywell is also playing a significant role in the biofuel segment. Honeywell engineered biofuel has powered every Navy testing flight to date and a large majority of the Air Force biofuel flights.”

New approaches to maintenance also extend the lives of military vehicles. Condition based maintenance (CBM) attempts to optimize maintenance tasks, save money, and improve machine operational performance with online monitoring of key subsystems and components for signal processing, detection of incipient failures and prediction of their remaining useful life.

“CBM will improve reliability, lower the total ownership costs of platforms, and extend their life spans,” said Cursio. “Industry needs to gain a better appreciation for these capabilities in order to assist the government with its logistics endeavors.”

“Honeywell’s onboard monitoring systems monitor vibrations, rotor wear and engine wear, to help identify and prevent component or system failure,” said Patrick, “increasing the life of product and lowering the overall cost of maintaining a platform or system.”

Meanwhile, Alion is assisting U.S. Army TACOM to adapt rapid maintenance and repair techniques from automobile racing to military vehicles. “We are developing a pit stop approach,” said Fletcher, “to improve the speed of repairs and, more importantly, integrating technology used in race cars which identify repair and maintenance needs.”

As Beggs suggested, the current budgetary climate may require a paradigm shift in the approach to life cycle management in order to make the headway required in the face of steep budget cuts. “There could be a time in the future that we see the two budgetary conversations over procurement and sustainment come together,” said Patrick. “The cost of sustainment, including spare parts support and RMU road maps, must be considered in the initial procurement decision as it is a huge part of the cost of life cycle management. The end result for the government will be cost of ownership savings over the life of the product.” ♦

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