Challenges for QDR-II: More the Logicians' Lament (II)

May 28, 2000

Comment: #360

Discussion Thread - Comment #s 359

Attached Emails:

[1] From an Active Duty Army Sergeant

[2] From a Retired Air Force Sergeant

[3] From a former Defense Department Civilian Logistician

[4] From a Marine LTC Bn CO

Comment #359 introduced you to some of the arcane complexities behind the breakdown of the logistics system in the Navy. The first three emails below, which are from people with hands-on experience in logistics management, respond to the senior logician's concerns by introducing supporting points of view in the Army and Air Force. In the fourth email, a Marine officer responds by critiquing the idea that one can apply management theories of business indiscriminately to a warfighting organization. While their opinions are not necessarily consistent each other, they are describing problems real people face at the in the real world - the kind of internal problems that must be resolved if we are to build a defense strategy that will not founder on its own contradictions.

As I have stressed in many earlier emails, the growing chaos in our military forces has little to do with the lower budgets accompanying the end of the cold war. In fact, combat forces have been cut by larger percentages than budgets, so spending per unit of combat power actually increased during the 1990s, yet our military is in the middle of a readiness meltdown.

The logisticians lament is a natural consequences of bumper sticker reforms and spurious planning assumptions, but that lament is only part of the much larger Defense Death Spiral, consisting of (1) a modernization plan that can not modernize the force, because new weapons are so expensive, older weapons can not be replaced on a timely basis; (2) a rapidly deteriorating readiness posture that is a consequence of the rising cost of low readiness; and (3) a corrupt accounting system that renders it impossible to fix the first two problems and makes a mockery of the constitutional principle of accountability here.

The mismatch between the stresses on our people in the field and the bogus "feel good" information about the future blessings of reform has also polluted the defense debate in Versailles. This has prevented the Defense Department from building a realistic military strategy for moving into the post-cold war era. Moreover, by fueling false cries for higher budgets, this mismatch is now setting the stage for a budget war with Social Security and Medicare late in this decade, when the baby boomers start to hit the retirement roles - a war the Pentagon can not and should not win.

The military services and the offices of Joint Chiefs and Secretary of Defense are now gearing up for the second Quadrennial Defense Review, or QDR-II. Thousands of people will eventually contribute to this effort.

The good news is that QDR-II is not scheduled for completion until Sept 30, 2001, so there are still 16 months to get it right. That should be plenty of time to assemble the more accurate information. Better information is now a logically NECESSARY PRE-CONDITION to QDR-II, if it is to avoid yet another strategic planning fiasco. QDR-I [1996-7] is in the dustbin of history, because it totally IGNORED the problem of corrupt information. QDR-I, consequently, converted a modernization plan that could not modernize the force into a plan that was even LESS CAPABLE of modernizing that force, while it set the stage for a continuing READINESS MELTDOWN, as should now be evident from subsequent events.

The BAD NEWS is that there is NO indication that the QDR-II planners have learned why it is important to clean up the bookkeeping system. In fact, recent news reports suggest that 'planners' are following the same flawed formula used in QDR-I: namely, by starting with lots of 'strategy' meetings to set the 'big picture,' by building a bureaucratic monster of committees inside committees to protect the turf of each service, and by gearing up for more resource-free dynamic commitment computer-driven wargames to justify all the data-free decisions. If past is prologue, we can expect these efforts to be packaged together in glorious Technicolor PowerPoint briefings.

RECOMMENDATION:

Why not start with the basics and do the job right. Let's spend the next 12 months trying to understand and account for real world problems like those described below and then use this understanding to assemble a more reliable data base. If the remaining four months is not enough time to analyze these problems in the context of this data or to synthesize the results into a robust strategic pathway into future, we could always delay the submission of QDR-II for two to four month without any danger to the Republic (a term that would have a more salutary meaning if we cleaned up the books to make the government actually accountable to the people.)

Chuck Spinney

[Disclaimer: In accordance with 17 U.S.C. 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only.]

Reference #1

Email from an active duty Army sergeant

I just read your latest blaster. Many of the same problems your logistician wrote about are occurring in the Army. Because I am not working in a shop environment right now, I cannot give you any current horror stories, except that there is an ongoing "War on Excess" that seems determined to get rid of all spare parts on hand, and trust the logistical system to get it to us "just in time".

Perhaps someone should have considered the implications of "just in time" in the event that major supply delivery points are shut down in case of a persistent chemical attack (airfields) and good old fashioned mines (seaports).

What really concerns me is the quote by Lt. Michael O'Neill on the last page of your blaster "We do not have people on the deckplate with the same depth of knowledge they had 15, 20 years ago."

I am sorry to say that the Lt is right on the money. One of the nasty side effects of the retention crisis is accelerated promotions. In the good old days of the mid to late '80's when Russia was still our enemy, promotions were quite slow. It was not unusual for an E-4 to have over 8 years of service before being promoted to Sergeant. This gave that E-4 several years to be used, and abused, and develop, and mature into the rank of Sergeant.

That isn't happening anymore. The exodus caused by junior and mid-grade NCO's is accelerating promotions in those ranks at a rate unprecedented in the 15 years I have been in the army.

This creates two problems that I see.

1) Inexperienced leaders tend to make more mistakes. In combat that usually means more filled body bags.

2) Accelerated promotions lead to the Law of Rising Expectations, which can actually cause more retention problems over the long term. If I can go from E-1 to E-5 in 3 years, then I should be able to go from E-5 to E-7 in less than 10 years. If I don't make it in 10 years, then I will get out.

Furthermore, in many of the Combat Support, and Combat Service Support MOS's, it is not unusual to be promoted to E-7 between your 15th and 18th year in service. And in those fields, there are fewer advancement opportunities above the grade of E-7, so people tend to stay there for awhile, those slowing down promotions.

If these individuals don't see themselves climbing the ladder of success fast enough, they will move to an environment where they can. In the current booming economy, there are many opportunities to do just that.

Stuff to think about over this Memorial Day Weekend.

Best,

Reference #2

Email from a retired Air Force Sergeant

I think your Logician was optimistic.

Over the last eight years we have stripped the West Coast of most of the Logistical Infrastructure that we would need to prosecute any serious Pacific problem such as Taiwan or Korea.

The DLA [Defense Logistics Agency] is also Part of the Problem causing some items to cost the User (the folks at the Unit level) ten or more times the civilian market price of the same item. [Note: The author is referring to a budgeting gimmick called industrial funding, were the "user," for example, a fighter wing, "buys" its parts from a government agency, in this case the Defense Logistics Agency, which obtains the parts through congressional appropriations. The agency uses non-market administered pricing formulas to sell the part to the "user." The pricing formulas can be driven by many factors that are unrelated to the original purchase price or supply and demand.]

I am now in the process of shutting down the LAST major defense depot on the West Coast, the Sacramento ALC [Air Logistics Center], housed McClellan AFB. Our production will be finished in a couple of months (end of June), most of the rest of the people will be gone by 30 September, and the remains will be handed over to Sacramento County by next July. Much of the hand-over has already happened.

The sheer stupidity of this move is illustrated by these facts:

1. Most of the civilian infrastructure in the high-end electronics industry is on the West Coast. That's why they call it Silicon Valley, but we are moving away form the West Coast.

2. Our most likely adversaries live on the west side of the Pacific Basin and some of them may be ramping up their arms capability. The latest acquisitions include guided missile ships and supersonic cruise missiles that might be fast enough to defeat the ship-board defenses.

3. Most of the "talent" did not move to the new locations despite aggressive recruitment on the part of the other Depots. In fact, less than 10% made the move with the result that the gaining depots are starting from scratch in terms of production people.

This means a net reduction in experience levels. The next two to five years are going to be particularly perilous for some major AF systems.

Yours Truly, AF NCO

Reference #3

Email from a former AF Civilian with Experience in Depots and with Defense Contractors

Excellent article, as another Graying Old Loggie I must agree with the lament.

The requirements formulae are part of the problem. "Just in Time" only works when you control the system from the top to bottom, and the Old Loggie hit it right, there is no predictability in the "supply chain".

In private industry in a market economy, when you hear of the "supply chain", the chain is the web, and everyone in the chain knows what they need to do. Furthermore, the suppliers, shippers, and repairers are judged on meeting their time commitments. If they can not meet their obligations, they are out of business.

That is not the case in the military.

First, the folks who buy the weapons do not test the components' reliability, so the predicted mean time between removals that generate the demands on the supply chain are grossly underestimated at the front end of the process, so you start out in the hole throughout the supply chain.

No system will be kept from going production, even if Dr. Coyle [the Pentagon's chief tester] or anyone in the chain says that testing did not validate the reliability specifications. So the new stuff won't be ready either.

Then, you have the law (10 USC 2466, Limitation on Contracting Out Depot Repair) that says 50% of the repairs have to be done in military depots. This 1940's mentality assuming that we can't get good repair work from the contractors. That was certainly true when the contractors were getting new weapons to build each year and did not care to keep up the systems they built.

Now the contractors need repair work to survive. Moreover, many systems are now dependent on commercial technology, so the government depots can't keep up with the technology or produce enough spare parts (again due to not knowing the reliability of the equipment in the field).

To make matters worse, another law (10 USC 2464, Core Logistics Capability) allows the Congressional depot caucus to demand repair work that the depots should not or can't do, all in the name of supporting core capabilities. This law plays reinforces the one above and results in depot repairs going to the inefficient and less capable depots simply to keep them busy.

The depots have become pork first, with repairs a far second, because they do not have to compete given the subsidizing effects of the two laws. The result is you send a repairable to a depot and lord only knows when it will get back to the fleet or wing, and consequently, depots can handle neither peace nor wartime ops tempo. [Note: this problem is magnified by skewed budgeting priorities that deliberately create backlogs of unfunded work as part of the annual planning process that trades off readiness to fund modernization. CS]

For most critical spares, the only source of supply is the repair depot. So, if you combine the effects of poor inherent reliability with a repair system that is built on pork, all our weapon systems become readiness problems.

Finally, the Air Force went from three to two levels of maintenance, partly to keep the depots busy and partly to make it look like forces were easier to deploy on short notice. Here things like jet engines are sent directly to the depot, when they used to be (could be) repaired at the (now defunct) intermediate repair level in the field [under the old three level repair system].

Sometimes this made sense, but at other times, all it did was send things to the depot to sit in line, waiting for maintenance, and away from the combat troops who could "beat up" on the person in charge of repairing it to get it fixed. So the local commander is now less able to manage, while the depots get more backlogged, and responsibility is watered down.

How do you fix all this?

I do not know, but a start would be to take a commander at one of the depots and tell them to fix all their repair backlog, whatever it takes.

I knew a Chief (E-9) years ago at a top notch supply outfit who never let the receiving line break for the day unless, all the property was moved to storage or the shipping section whichever was appropriate.

We need leaders in the repair system that don't give up on a system because it is "quitting time". What they can't fix for want of parts, they can raise hell with the system until it is fixed.

Of course, porkbarrel depots have beaten good leaders in the past.

This is Memorial Day weekend and we can all ask ourselves if we have done enough to respect the sacrifices of the men and women who gave their all.

Reference #4

Email from a Lt Col in the Marine Corps

The comments on "Japanese management methods" include, I assume, the theory of Total Quality Leadership/Management (TQL). The "L" incidentally was the price of Marine Corps buy-in to TQM. This made it an immediate non-sequitor, as TQM is a strictly a Management methodology. Incidentally, Dr Demming, who invented TQM/TQL, was not Japanese but American. However, to expand on the previous comments, (as a grunt with an undergraduate degree in Applied Math and an MBA): TQM/Demming is a methodology designed to manage linear production processes, where component production lines flow into a central line that produces a specific product. As such, it includes a number of common-sense and correct observations about statistical limitations blah blah blah. To be brief: It's a good model for what it was designed for.

Now for the bad news for ardent fans of TQL: as your previous commentaries imply, the battlefield is a staggeringly non-linear environment. It is a matrix with a virtually infinite number of component factors and many dimensions. This favors neither linear production nor "just in time" methodologies, not does it favor linear thought processes. It is why historically great generals are capable of both very methodical and highly intuitive thinking. Redundancy is a key component to successful warfare. Or to quote that great management guru SFC Hunt at Ranger School in 1980: "The first Ranger rule is: Have a primary and an alternate for everything. If you want to get more historical and sophisticated about it: "Git there the firstist with the mostist." It is better to have too much "mostist" at the critical mode than not enough.

Modern technologies and methodologies have the capability to contribute to the management of the military and to warfare. However they must be applied consistently with the real principles and nature of warfare. If instead we try to shoe-horn warfare into our vision of some management model that has nothing to do with the realities of the battlefield, than, to put it politely: we'll get our ass kicked. Ask former SecDef McNamara and his gang of aging HBS whiz kids. Or better yet, go see the results of our first "managed war" on that black wall on the Mall.

Semper Fi,

QDR