1 A Perspective on New Maritime Strategy in the Current Environment John O’Neill

2 Strategic Context  Influence and shape in diversifying areas  Increasingly diverse partners  Domestic Agencies  International  Private  Increasing mission diversity  GWOT/Homeland Defense  Humanitarian assistance  Nation-building  Maritime interdiction  Rapid response timelines  Decisive actions  Capability Based Tenets of New Maritime StrategyImplications  Increasingly flexible, adaptable, reconfigurable forces  Increased multi-mission capability, agility/readiness  Rapid capability development/deployment  Sufficient numbers to support strategic tenets  Quantity also matters  Cost must come down to support budgetary reality Budget Reality vs. Diversification: A Conundrum?

3 Environment Navy Plan Likely Outcome Average Age Declining/Aging Ship Force Structure Escalating Ship Acquisition Costs Diminished Acquisition Force Manpower Costs Rising Disproportionately Current approaches do not support strategy # Ships Age in Years 2005 $ $ Naval Personnel B 7B 290K 390K 30B 5B 50K 150K

4 Necessary changes?  Reduce cost of new platform design/construction  Improve electronics modernization  Extend the effective service life of existing platforms  Increase ability to rapidly, affordably insert capability  Reduce Manpower/Total ownership costs  Operational and Infrastructure Doing more with same processes and costs?

5 Reduce cost of new platform design/construction  Separate electronics life cycle from the platform  Recognize that ship life spans 10 electronic generations  Common electronics forward fit and back fit  Optimize capability at fleet level, not platform level  Spiral development – Focus on eliminating change activity  Requirements defined and frozen early in each spiral  All but critical changes to next flight  Mature design prior to construction  Drawing completeness prior to release – minimize reservations  100% drawing release prior to construction  Construction process/technologies proven prior to start  Once design is proven, use EOQ for planned spiral qty’s  Improve all stakeholder accountability for all business case/outcome Program Management & System Engineering Rigor

6 Improve Electronics Modernization  New electronics business model supported by a systems architecture that features:  Common, scaleable systems  Modular, federated components with well defined I/F’s  Maximum use of commercial technology/practices  Capability focused, ongoing Technology Transition process widely open to academia/gov. lab/industry  Lifecycle support/Technology Insertion/Development from same process  Measured, closed loop User process  Benefits:  Highly adaptable to changing mission requirements  Reduced time/costs of capability development and upgrades  Reduced total ownership costs  Increased competitive acquisition Affordability in Current Budget Environment Demands a New Electronics Business Model

7 Reduced Manpower/Total Ownership Costs  Operational Manpower reduction from increased reliance on:  Remotely operated/automated systems  Unmanned Systems (UAVs, USVs, UUVs)  Netted, offboard systems including distance support and reachback  Increased redundancy with aim to eliminate onboard maintenance  Infrastructure Reduced Total Ownership Costs TOC from  Increased commonality in warfighting capability areas  Merging development and support infrastructures  Increased redundancy with aim to eliminate onboard maintenance training Cost Walks

8 Summary  New Maritime Strategy and necessary force structure requires a modified acquisition approach  Lower costs for new platform design/construction  Common systems across warfighting domains  Business model that allows rapid capability evolution and continuous competition  Reduced Operational and Infrastructure manpower/costs