Littoral Combat Ship Program

Dec 2, 2000
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From the Navy Newsstand:
quote:

WASHINGTON (NNS) -- Secretary of the Navy Donald C. Winter has named the Navy's newest Littoral Combat Ship (LCS) — Independence.

“Independence, along with USS Freedom, are going to be great 21st century ships. Their speed and agility are widely recognized. I believe that their modular approach yields tremendous flexibility for employing these ships and for taking the fight right to the enemy’s shoreline," Winter said.
For the rest of the story, go to http://www.news.navy.mil/search/display.asp?story_id=22989

For information on the Littoral Combat Ship, go to http://peoships.crane.navy.mil/lcs/
 
Dec 2, 2000
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From The Navy Times On Line:
quote:

Scrambling to regain control of Littoral Combat Ship program costs and forestall a congressional firestorm, Navy leaders have called for a temporary halt on construction on the third LCS while examining why cost growth on the first one has jumped as much as 86 percent.

A recent cost review of the USS Freedom showed that the estimated price had jumped from a planned $220 million to between $331 million and $410 million, according to a Navy official. That ship is under construction by Lockheed Martin and scheduled to be delivered to the Navy this summer.

The third ship is in fabrication, an early stage of construction.

As a result of the findings, Navy Secretary Donald Winter decided on Jan. 12 to put out a 90-day stop-work order on Lockheed’s second ship until the causes of the cost growth are found and a way ahead is determined.

The Navy, a service official said Jan. 12, needs to “fully understand whether the cost problems are unique to the lead ship or an indicator of increased follow-on ship costs”￾ before building more Lockheed ships.

Service leaders have been aware of cost growth in the LCS program, but until recently were not aware of the extent.
For the rest of the story, go to http://www.navytimes.com/news/2007/01/ntdfnLCS070112/

Opinion: Given that the Littoral Combat Ship is a centerpiece of the plan to get the U.S. Navy up to a 300+ ship fleet which is better suited for modern day combat operations, this is not very good news. Anyone care to bet that the parties least responsible for the problems will get 100% of the blame?
 
Dec 2, 2000
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The saga continues. From The Washington Post.com:

Costs Ballooning for New Combat Ship
quote:


By Renae Merle
Washington Post Staff Writer
Thursday, March 1, 2007; Page D01

A Navy program to build a new combat ship to patrol coastal waters will face another cost increase, government officials acknowledged yesterday, a hit to the service's attempt to keep expenses under control so it can afford a larger fleet.

The increase is expected to affect a version of the ship being built by General Dynamics and comes as Congress is becoming increasingly critical of rising costs in weapons programs and has questioned the Navy's handling of the combat-ship contract.

The size of the increase is still unclear, but it may be similar in scope to an overrun encountered on another version of the ship being built by Lockheed Martin. That one is now projected to cost $350 million to $375 million, according to Navy officials. The two ships were initially priced at about $220 million each.
For the rest of the story, go to http://www.washingtonpost.com/wp-dyn/content/article/2007/02/28/AR2007022802143.html

Comment: Another attempt at a cheap solution that only managed to get more expensive as time goes on. The original program called for 55 ships. If anyone thinks the Navy will ultimately get that many, I've got a bridge in Broooklyn I'd like to sell you.

No cheques please. Cash, and in small unmarked bills!
 
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Wayne Keen

Guest
There is an aspect to this that those who are not familiar with the procurement process may not fully appreciate.

Lets say you are have a weapons system that you think you need. Now, every new weapons system these days is going to have a strong element of - well, sticker shock. So you try to cut some corners, do some fudging, and get the price down to a level that you think will get your program underway - knowing that, once the process has started, that congress will have to give you extra money for the propellers that you somehow forgot to put in the price.

Now, generally, this process goes on quietly, and everyone knows it is going on. Price creep does not cause a big splash as long as everyone knows that is happening, and no one is surprised. But you can have cases, like this program, where the information doesn't flow in a timely fashion - and people get embarassed when it breaks lose.

Wayne
 
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Don't underestimate the potential for sheer embarrassment while you're all at it. To quote the article; " A key part of the program was turning a commercial ship design into a cheap $220 million combat vessel." all of which ignores the fact that ship's hulls are reletively cheap. It's all the systems that get stuffed into it which jack up the price. This is especially true of a warship, and it's amazing how few people really understand this.

This, BTW, is why proposals for aircraft carriers half the size of the current nuclear powered supercarriers have shown little signifigent difference in costs from the much larger Nimitz class once the numbers are crunched. Unfortunately, there are a number of people who confuse the sheer size of a hull for the level of expences incurred and some of them have the power of congressional and senatorial seats.

Using a commercial design and standards was supposed to keep the costs down, and that's the line that was sold to Congress and the public. It may well have done that to a limited degree, but once the hull is in the water, one still has to pay for the sensors, the guns, the missiles, the fire control suite, command, communications, and control equipment that goes in.

Inconveinient facts like that tend not to go over too well with congresscritters or the taxpayer!
 

Jack Devine

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History has shown that whenever they try to design a "cheap" combat system, the bureaucrats both in and out of uniform start wondering why we can't add just a bit more capability. After all, if we have a good coastal warfare ship, shouldn't we add berthing for a company of Marines? And they could use some air support, so add a hangar for a pair of helos. Maybe some land-attack missiles, toss in some anti-submarine capability, etc etc. Pretty soon that small gunboat is the size of the Yamato, for only double the cost.
 
Mar 3, 1998
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None of the comments here reflect the way my company -- or our competitor, LockMart -- does business with the US Navy. SOX has changed the procurement process and contracts awarded today restrict the amount of LOE tasks, usually under 15% of the total contract tasking. Discrete tasks, managed under a strict Earned Value Management System, is what the Navy now requires of its civilian contractors; in fact, if the Navy had its way, all tasks would be discrete (with the possible exception of management and lifecycle tasks). Conversely, the rollout of IPDS and EVMS has done much to minimise requirement creep by forcing the Navy to come up with more money whenever they want additional capability/functionality that was not provided for in the original BOEs.

You guys make it sound like my business is stuck in the 1970s, and I would counter that you need to refresh your knowledge on the subject before you talk so knowingly.

Parks
 
Dec 2, 2000
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From The TimesDispatch.com:

Admiral: Lockheed could lose part of combat ship contract
quote:

By REBECCA CHRISTIE
Dow Jones Newswires Mar 8, 2007


WASHINGTON - Adm. Michael Mullen, the Navy's Chief of Naval Operations, said Thursday that Lockheed Martin Corp. could lose part of its Littoral Combat Ship contract, depending on the results of a pending review.

Lockheed Martin is on contract to build two ships, dubbed LCS 1 and LCS 3. The first ship is under construction and considerably over budget, which recently prompted the Navy to halt work on LCS 3.
For the rest of the story, go to http://www.timesdispatch.com/servlet/Satellite?pagename=RTD%2FMGArticle%2FRTD_BasicArticle&%09s=1045855935241&c=MGArticle&cid=1173350107712&path=%21ne ws%21vaapwire

Comment: Since Parks knows the ground, I'm inclined to defer to any insights he has on the matter. Whether or not any of the media reports has anything to do with reality is anybody's guess, but it's the media's take which the public sees and tends to base their opinion on. Guess who puts the most pressure on the guys who are in office!
 
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Wayne Keen

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I am working on an LCS related program - i.e. a system that goes on the ship, so my comment about information flow and the budgeting process getting hosed was not exactly derived from press releases.

Parks has of course been in this field for *much* longer than I, so in any disagreement between he and I, one is very wise to listen closely to him.

Wayne
 
Mar 3, 1998
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I'm sorry, I don't mean to sound so curmudgeonly, but when I read on this thread how little progress the defense contracting and procurement business has made over the past few years -- when my job exists solely to implement those improvements -- I got more than a little angry. My job is very stressful -- I'm the man in the middle between the people trying to do the actual work of building the ship and the upper management who is forever demanding more and more metrics to account for every cent of performance claimed -- and to log on here and read that, well, my industry (and therefore, people like me) is selling the same old con to the Congress and the public...that just sent me over the edge. You're basically telling me that for all the sacrifices I make for my job, I'm not making a difference. Well, I disagree...I have to believe that I'm earning my pay.

Is the process perfect? No, it isn't. Are unexpected costs a fact of life in contracted work? Of course. Is information shared with everyone who needs it? No. Can I speak for LockMart? No, but even though they are our largest competitor, I have to assume that they are trying as hard as we to deliver a quality product to the warfighter. If they aren't, then they deserve to have the LCS contract taken away from them. But, I've seen enough to know that in this business that things aren't as simplistic as they seem in a news article. And my position in my program allows me to see that things are also not so simplistic even to most (at the worker-bee level) who work on the program. This is by design...if I don't act as a "s__t screen" to protect the engineers from the demands of upper management, no constructive work would ever be done. They have enough to deal with just developing the new technology and delivering a workable product on schedule. I'll do my best to help keep the woes and demands of management off their back.

Wayne, you may very well know what you're talking about. If what you described happened on my team, I, along with my IPT Lead and Technical Director, would be fired. As it is, any request for extra money in my program goes through a process so rigourous that we consider it virtually impossible. Instead, we operate under the assumption that budgets will only get smaller, not supplemented. In saying this, I can't speak for either your company or your prime.

Michael, COTS (Commercial Off The Shelf) equipment does keep costs down. Yes, dealing with COTS has its difficulties and in the hi-tech world, the leading edge of COTS technology is a moving target, while the military procurement process is a lumbering dinosaur by comparison. However, the days of militarised equipment is long past. The use of COTS in combat and weapons systems is expected by Congress, the Navy and the warfighters at the user level. It's not a line sold by the contractors to the taxpayer; rather, it's a requirement placed by the customer. We contractors are required to make COTS work, and we're doing the best we can within the system. How does one include a processor in a system design, for instance, that will become obsolete before it can be fielded? How does one maintain lifecycle support for a system that depends on that processor long after its market has dried up and the vendor no longer can produce it? Obsolescence Management is just one of the challenges behind the use of COTS in system design and to date there's no real answer. But, the Navy wants cutting-edge technology and they do not have the budget to develop an independent manufacturing, testing and qualification base of their own. The civilian industry is their only affordable recourse, which is why the Navy has established COTS as a requirement. So, yes, the implemention of COTS into weapons/combat systems development is costly, but the alternative would be even more so.

There are examples that I would like to give to illustrate what I say, but I'm afraid that someone from either my company or one of our subcontractors might happen across this site (you'd be surprised how many companies keyword search the Net for posts by disgruntled employees), take issue with what I say and make my life very difficult, to say the least. So, since I can't fully defend what I claim, I should just keep my damn mouth shut.

Parks
 
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>>(you'd be surprised how many companies keyword search the Net for posts by disgruntled employees), <<

Actually, I wouldn't be in the least bit surprised at that. I expect it, and ET is a lot more in the public eye then some of the members here may realize.

As to keeping costs down, I can see how COTS manages that. Unfortunately, this and the surrounding problems are not understood by Joe and Jane Sixpack on the street. What they see is the the promise to keep costs down on the one hand and a price tag which is double the advertised projection on the other making it into the headlines.

Is the read a shallow one????

Damn right it is.

Will anyone look beyond that and consider the likely possibility that the alternative will cost a helluva lot more?

I wouldn't count on it.

They'll take the newspaper accounts as holy writ when they contact they're congresscritters and some of the congresscritters tend to make the same mistake. Even if they don't, they're going to be very aware of the pressure put on them by the people they want to have vote for them and act accordingly.

Ain't politics wonderful???
 
Mar 3, 1998
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Michael,

You said:

quote:

Using a commercial design and standards was supposed to keep the costs down, and that's the line that was sold to Congress and the public. It may well have done that to a limited degree, but once the hull is in the water, one still has to pay for the sensors, the guns, the missiles, the fire control suite, command, communications, and control equipment that goes in.

Inconveinient facts like that tend not to go over too well with congresscritters or the taxpayer!

And then later you said:

quote:

They'll [taxpayers] take the newspaper accounts as holy writ when they contact they're congresscritters and some of the congresscritters tend to make the same mistake. Even if they don't, they're going to be very aware of the pressure put on them by the people they want to have vote for them and act accordingly.

You're straddling both sides of the fence here...first you blatantly accuse people like me of selling a line to a skeptical public (and their public servants), then you figuratively throw your arm around my shoulder and accuse the public of being ignorant. Which is it, Michael? I'd like to know where you REALLY stand before I continue with this conversation.

Parks
 
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>>first you blatantly accuse people like me of selling a line to a skeptical public <<

I think you misunderstood me. I'm not accusing you of anything. (What the Navy is doing as an institution and how they're handling it is another matter, but there's nothing you can really do about that.) However, that is what the public is being told and from their point of view, that's not what they're getting. This whole has gone political in a very high profile way, and in politics, perceptions are everything whether they have anything to deal with reality or not. They always have been.

If you don't want to continue with this, I'll leave it at that since I suspect we may well end up misunderstanding rather then understanding each other.
 
Mar 3, 1998
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Michael,

For what it's worth, the LCS program has the misfortune of having been started before SOX was imposed. At some point during the ship's development, the Navy and their contractors had to deal with a management/oversight transition to accommodate SOX. That may be at the root of their troubles, I don't know for certain, but I would look in that direction if I wanted to dig deeper into the story.

In politics, it's been my observation that Congress doesn't react to perceived public anger over stories like these. What I believe really motivates any given member of Congress -- regardless of party affiliation -- is how much of the program benefits their constituents. Take a USA map sometime and plot all the sites where the individual components for any major weapons system -- including the ship under question -- are designed and/or manufactured. You may find that the most successful systems are made up from parts originating from enough Congressional districts to assure a majority vote for continued funding. LMCO once bragged publically that they had sites in all 50 states (a PR miscalculation that came back to bite them later), but many of the major defense contractors can claim the same.

Parks
 
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>>What I believe really motivates any given member of Congress -- regardless of party affiliation -- is how much of the program benefits their constituents.<<

Otherwise known as "Bringing Home The Bacon" which is a sure thing to get any congresscritter's cold feet warm again. That I understand! The constituants occasionally make a lot of sound and fury about how "unethical" that sort of thing is from time to time, but it's amazing how the sound and fury tends to die away when the goodies are starting to show up in their paycheques.

By the way, what is SOX? I've never run into that acronym before.
 

Grant Carman

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SOX is a short form for Sarbanes - Oxley Act. Named after the 2 politicians who sponsored the legislation. It was put in after the Enron fiasco. It basically updates the rules for corporations, and holds Chief Executives and Boards of Directors legally and financially liable for ANY financial or legal shinanigans committed at any layer of the company.

It is the bane of many companies, but what it has done is made many many companies more open and accountable.
 
Mar 3, 1998
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My apologies...yes, as Grant described, SOX is the legislation that ensures that every aspect of a business is made fully accountable. The Navy has made it a requirement for all new major contracts. When I joined the DDG-1000 program, SOX essentially became my job. In my given area, I am required to know where every contract dollar goes and exactly how many are required to get the job done. I also know to the day when every individual task, no matter the size, starts and stops. I report all of this on a weekly basis to upper management, and my reports eventually get folded in to program updates to Congress. If I have to ask for more money, I have to fully demonstrate to my entire chain of command why the original budget is not adequate. Depending on the threshold crossed, I may have to explain myself all the way up to Congress. If costs for a given system need to increase, they will do so only after full consideration and approval from the Navy and Congress (for that reason, it is virtually impossible for someone at my level to gain approval for additional budget). SOX is specifically designed to make hidden costs a thing of the past.

It is, as Grant says, a difficult paradigm to implement, but excesses, abuses and wastes in the past have made SOX a necessity. It's definitely not easy, though...my job now consumes my life more than it ever did before SOX. I've also never been so worried about my job security. The increase in my responsibilities is a major reason why I have had to curtail my extracurricular activites (like posting in Titanic forums) in the past couple of years.

Sarbanes-Oxley made big news at the time of its enactment. The public should know what the Act means to them, especially in regard to how the Government spends their tax revenues. If they don't, then it won't be for lack of information.

You might see now why I am so sensitive to charges that the military procurement system is the same old honey pot for politicians, military brass and contractors that it was in the past. I have given up part of my Titanic involvement (among other, more important, things) just to ensure that improvements to the procurement process are correctly implemented. As a taxpayer, you should take heart in that.

Parks
 
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Wayne Keen

Guest
On the plus side, the delays in the kicking off some of the systems has led to some money changing over to more up-front studies / algorithm design work and test.

Parks - I am in a weird position with respect to this program. I work for a contractor that supports a government lab - not a Navy lab interestingly enough - but we are supporting the Navy folks. (My Navy boss and I talked about the situation the last time he was down here)

I am mainly (in addition to my other roles as buffoon and court jester) an infrared phenomenology man. We are providing tools for designing / developing and testing signal and data processing algorithms, and doing seeker trades.

Failing *miserably* to make a long story short, the delays I think will, if they don't kill the program, make for some more effective systems.

Wayne
 
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>>You might see now why I am so sensitive to charges that the military procurement system is the same old honey pot for politicians, military brass and contractors that it was in the past.<<

Yes I can.

For what it's worth, you should find this piece from The Navy Newsstand to be encouraging:

Secretary of the Navy Recommends Way Ahead for LCS Program
quote:

Story Number: NNS070315-05
Release Date: 3/15/2007 7:27:00 PM



Special release from the U.S. Department of Defense

WASHINGTON (NNS) -- Based on a comprehensive review of the Littoral Combat Ship (LCS) acquisition program, Secretary of the Navy Donald C. Winter announced March 15 that he is prepared to lift a previously issued stop work order for construction of LCS 3.

The ship is currently under contract to Lockheed Martin Corp. Maritime Systems & Sensors unit, Moorestown, N.J. Lifting the stop work order is contingent upon the Navy and Lockheed Martin reaching agreement on a renegotiated contract.

As a result of a nearly two-month assessment, the Navy has revalidated the warfighting requirement and developed a restructured program plan for the LCS that will improve management oversight, implement more strict cost control, incorporate selective contract restructuring and ensure that an important warfighting capability is provided to the fleet consistent with a realistic schedule.
See http://www.navy.mil/search/display.asp?story_id=28345 for the rest of the story.

What I'm wondering is if the Navy will ultimately get the 55 ships it's hoping for in this program. Realistically, I'd have to say "Probably not" but then any number of factors that can't possibly be forseen will almost certainly play into that from the direction the costs go in to the nature of the percieved mission changing. They could get fewer ships, but depending on how things go, may even end up buying more.

Any guesses/ideas on that?
 
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Wayne Keen

Guest
A lot may depends on the development work with the Sea Fighter and the early delivered ships.

The potential for teething problems is quite real, given the ships flexible mission module approach, and new ways of manning and running the ship.

Having a tool is one thing. Getting proficient at running and employing it is another. (Please, no images of Wayne with power tools need be inserted).

But then again, I am just a dumb old country boy physicist, who had never been aboard an actual, *working* warship before last year. (Now it should be clear to you why my advice about listening to Parks over me was not simply humorous self deprecation)

(Yeah, I know, it wasn't even that humorous)

;)

Wayne