ARS 2004ARS 2004San Diego, California, USASan Diego, California, USA

Keynote AddressKeynote Address

The Challenge of Supporting The Challenge of Supporting Aging Naval Weapon SystemsAging Naval Weapon Systems

RDML Michael C. BachmanAssistant Commander for Aviation Logistics

Naval Air Systems Command

PRESENTATION SLIDESPRESENTATION SLIDES

2004 Symposium ProceedingsInternational Applied Reliability Symposium

June 16 - 18, 2004: San Diego, California USAhttp://www.ARSymposium.org

Copyright Copyright ©© 2004 ARS, All Rights Reserved.2004 ARS, All Rights Reserved.

Slide Number: 2Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Outline

BackgroundReadiness ChallengeAIRSpeed DefinedAIRSpeed ApproachIn-Service Reliability ProgramAging Aircraft IPT Summary

Slide Number: 3Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Today’s Readiness Challenge

CNO has directed a new Fleet Readiness Program (FRP) to support fleet operations in the Global War on Terrorism Naval Aviation will have to support current levels of readiness despite a budget shortfall Requirements growth in the Flying Hour ProgramNavy and Marine Corps unit commanders will fight in a cost-wise readiness environment

Slide Number: 4Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

NOTE: TRENDS ASSUME CURRENT PROCUREMENT PLANS EXECUTED THROUGH 2012RECENT POM-02 CUTS WILL LEAD TO INCREASED AGE

6

11

21

26

31

73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13

YEA

RS

FISCAL YEAR

FY00 AVERAGESHELICOPTER 20.1 YRSFIXED WING 17.2 YRSCOMBINED 18.0 YRS

HELICOPTER

COMBINED

FIXED WING

SOURCE: AIR-4.2.5

AVERAGE AGE

HELICOPTER / FIXED WING / COMBINED AIRCRAFT AVG AGE

* BASED ON 9/30/98 AVERAGE ATTRITION RATE** FY99 PRESIDENT’S BUDGET (FY99-05)

UPDATE: 18MAY00

Naval Aviation’s Aging Fleet…the challenge

-Average Age of Fleet increasing through FY09 -Cost of readiness increases closely associated with age and wear

Slide Number: 5Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

NAVAIR’S Focus: Reliability and Cost … Create a Culture of Cost-Wise Readiness

Goal…Provide the tools to understand, then optimize the business of Naval AviationOutput: Trained Units (squadrons / detachments)

Flying Hour Program: Examine all FHP costs to find a better way to invest our limited resources

Controllable elements Direct Costs…(those that drive Cost Per Hour)

Strategy: Investments to reduce support costs and improve reliability/readiness

Reduced component demand = less maintenance = less cost

Slide Number: 6Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Readiness Problem and the Start of NAVRIIP

Metrics were un-reliable, inconsistent and had no common language (sorties, parts, dollars…)

Limited predictability in parts requirements, FMC/MC were readiness metricsNo reliability metrics tracked or measuredFocus supported near term solutions, i.e. buy vice integrating all support elements

The solution …The Naval Aviation Readiness Integrated Improvement Program

Slide Number: 7Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

NAVRIIPT/M/S business teams created; responsibility and accountability assigned; process improvement tools deployed – cockpit charts and entitlementsRobust metrics using a common language Aircraft “Ready for Training” (RFT) installed

All commands supporting aircraft/mission system needs in the right place at the right timePMAs and Wing Commodore share focus on readiness using the same metrics

Requirements for the right readiness issued as a time phased aircraft and system forecast

Linkage of sorties, parts, people and dollars enabled

Slide Number: 8Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

NAVRIIP Cost Management Strategy

● Link all NAVRIIP elements:●Build business case for investments in Top Cost/

Readiness Degraders● Identify applicable funding stream(s)● Look for opportunities in POM budget process to

invest● Develop an Integrated Budget methodology

●Proven process employed by the PMB●Applies reliability readiness-based analysis●Quantifies sensitivity of budget options●Highlights options ($ and Time) to achieve Cost Wise

Readiness

Slide Number: 9Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Touchstone

“AIRSpeed is NAVRIIP’s Enabler for operationalizing cost-wise readiness across

the Naval Aviation Enterprise.”

Slide Number: 10Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

What is AIRSpeed ?

It is an enterprise approachCreates a continuous process improvement environment It aligns and optimizes Maintenance and Supply activities to end-user demand (Operations)Leverages existing initiatives

Synergizes a set of industry toolsEliminates sub-optimization

Local decisions made with Global impact knownCreates a “pull” system

Slide Number: 11Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

“Local decisions must be aligned to the global impact”

Fundamental Principles

Manage RFT/O Mission

Reduce Inventory/Investment PartsEquipment FacilitiesAPN

Reduce Operating Expenses O&M,N MPN

Slide Number: 12Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

AIRSpeed Current Tools

Theory of Constraints is based on the belief that any organization has at least one constraint and that any improvements on non-constraints may not yield as significant ROI as working on the constraint. LEAN focuses on the removal of waste -- defined as anything not necessary (no value added) to produce the product or service. Six Sigma is based on the assumption that the outcome of the entire process will be improved by reducing the variation of multiple elements. AFAST is a Cost Analysis tool used to understand Consumption Variances and Production Cycles.

Slide Number: 13Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Three Key Deployment Elements

Basic Theory of Constraints (BTOC), Formerly known as RIFLe

Lean and Six Sigma

Advanced Theory of Constraints (ATOC)

All combined to create a culture of Continuous Process Improvements

Under the notion of Cost-Wise Readiness

Slide Number: 14Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

AIRSpeed Teams Will….

Re-design the sustainment, repair and replenishment processesBreak down all the walls and start over

Beginning on the flight line and then work what happens to a part through the entire process Squadron - I level to the Depot Distribution (DD) Center including the DLA/Supply process

This is not component specific -it is process based

Local actions with global implications below the LORA & WP level

Slide Number: 15Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

AIRSpeed’s SynergyAIRSpeed capitalizes on other NAVAIR initiatives:

IISRP – Integrated In-Service Reliability Program

AAIPT – Aging Aircraft Integrated Product Team

Slide Number: 16Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

IISRP

SUPPORT THE WARFIGHTER BY IMPROVING RELIABILITY

“We must sustain the war against terrorism… develop [a] plan to improve aircraft engine and component reliability…”

ADM Vern ClarkChief of Naval Operations

CNO Guidance for 2003, Achieving Seapower 21!

Slide Number: 17Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Integrated In-Service Reliability Program

Target high value/low reliability Aviation Depot Level Repairable componentsEmploy proven R&M methodologies and best commercial practices adapted to our environmentTeam with leading industry experts to enhance our processesExport the resulting R&M practices to Fleet Support Teams throughout NAVAIROptimize In-service R&M

Slide Number: 18Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

IISRP ProcessInvolves all stakeholders:

Fleet O and I-Level Maintainers PMA/FSTsDepot Managers and ArtisansNAVICP and DLA

Scrutinizes every aspect of support Ensures proposed “fixes” are supported by root cause analysisMonitors results

Slide Number: 19Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

“To improve fleet readiness and reduce life cycle cost by aggressively attacking and countering the effects of aging aircraft.”

Identify Problems - Quantify RiskProvide Information to Program teams

Available Funding SourcesOther IPT Solutions

Advocate for Enabling TechnologiesProvide Standard Risk and Cost Evaluation ToolsFocus Attention to Aging Aircraft problems

Not a Program OfficeProvides Pointer to PMAs

Future Naval CapabilitiesTotal Ownership Cost IPT

TeamingNASA, FAA,

USAF

AAIPT Vision

Naval Aviation - AAIPT Team Approach

Step 1AAIPT Develop Process

PMA

Step 3Solutions Provide Feedback to Improve Process

Risk ID

Determine options

Cost Models

NALDA

Solutions

POM Input

LECP/TOC

S&T

Step 2Program Implement

Solutions

Quick Response Rapid PrototypingRAMECsPubs

LongTerm

Transition Agent

AAIPT

Fleet

Coordinated Funding

Slide Number: 20Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command Slide Number: 21Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Naval Aviation’s Bottom Line….

“Warfighting Is Naval Aviation’s Number One Priority. Successful Warfighters Understand How To Lead And Manage Their Commands

To Extract The Maximum Warfighting Capability…. While We Measure Our Profit In Terms Of Readiness And Mission Success, We Have a Duty To Achieve These Goals In The

Most Cost Efficient Manner.”

- VADM Malone

Slide Number: 22Keynote AddressRDML Michael C. Bachman, Naval Air Systems Command

Summary

To date, we have achieved great readiness… at great cost. Now we need great readiness at optimized cost.Dynamic change is needed in the way we fund and support our weapon systems across all levels of maintenance.This is all about the Business of Naval Aviation, something new, something we have never had to learn before.Leadership commitment is the Key to success.