1 NAVSEA TMDE PROGRAM POM 06 BRIEF Ed Chergoski NAVSEA 04L52 04 November 2003

2 NAVSEA TMDE PROGRAM NSWC Seal Beach Engineering and Technical Specifications Procurement Training Liaison Program Office Support NAVSEA 04L52 PROGRAM MANAGEMENT NSWC Earle SPETERL to COSAL conversion Allowancing &Configuration Mgt NSWC Corona Calibration Standards Allowancing and Procurement ICP Development NAVSEA Budget Specialist Gail Miller

3 NAVSEA TMDE PROGRAM Team Construct IHD Det Earle IHD Det Seal Beach NSWC Corona John Lupi (90%)Steve Makieil (100%) Len Rice (9%) Joe Teti (100%)Kathy Saunders (80%) Kathy Ingenhousz (94%) Rich Devenero (100%)Mark McHugh (100%) Ernie Davison (100%)Steve Mosczynski (100%) Donna Morse (100%)Greg Hogan (100%) Iksang Ro (5%) Program Support Dennis Kelly (100%)

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6 PriorityFunctional GroupAnnual MaintenanceAverage Cost per Unit 1Signal Generator$5,382,838.49$5, DMM$4,301,951.42$ Baseband Generator$3,722,906.30$1, Synchro Indicator$3,520,850.94$1, Spectrum Analyzer$2,197,164.55$2, Calibrator$2,111,725.80$4, Logic Analyzer$1,952,713.16$3, Oscilloscopes$1,801,961.62$ Voltmeter$1,498,560.14$1, Frequency$1,229,301.89$ LAN/WAN$1,178,429.61$3, This denotes the total annual costs by functional group including calibration and repair, and then, for those that are bolded, reprioritized based on Fleet requests that the TMDE program resolve issues with problematic or obsolete groups of equipment

7 NAVSEA TMDE PROGRAM Mechanics of analysis POM construct was based on individual GPETE model reliability and maintenance cost, ‘Cost of Ownership’. MOCC data from 1998 through mid-2003 was used to derive 3 values for each individual model number: Repair (Failure Rate): likelihood that a model would fail calibration or be submitted for repair (expressed as percentile) Calibration: average hours expended to calibrate a given model Beyond Economical Repair (BER): model submitted for calibration fails (is rejected), is submitted for repair, and shows no completed repair, subsequent calibration, or recall date (expressed as count). Cost is projected as outright procurement cost for standard model in the SCAT. Based on these 3 values, the annualized costs of maintaining the Navy inventory, as reported by TEMIS, was calculated.

8 NAVSEA TMDE PROGRAM Assumptions and influencing factors MOCC data integrity, while improving, varies greatly between reporting years. MOCC data reflects multiple entries for individual GPETE items 197,866 GPETE line items reported by MOCC 95,882 GPETE line items reported by TEMIS (derived from SCLSIS) Hinging Fleet expenditures on model vice SCAT will identify the ‘bad actors’ in Navy inventory Ignoring platform application will provide the best averaged sample of actual equipment performance/reliability Inadequate reporting of repair part expenditures justifies excluding repair part costs from repair calculations.

9 NAVSEA TMDE PROGRAM Mathematics Calibration Costs Repair Costs BER Costs

10 5 Year Procurement Plan Three key requirement areas: 1.Outfitting Based on Deploying Battle Groups 2.Obsolete Equipment 3.Standardization –In addition to engineering considerations we consider the following when performing standardization: -Models with short calibration intervals -Models with low inventory quantities -SCAT Code Consolidation - RM&A NAVSEA TMDE PROGRAM

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12 NAVSEA TMDE PROGRAM This curve (shown below) indicates that the average maintenance costs for most test equipment begins to rise sharply at an economic age of 14.7 years. Within most GPETE functional groups, this is the point at which purchase of new equipment to replace obsolete inventory becomes fiscally imperative. Based on historical control numbers however, the current GPETE inventory of over 127,000 line items worth roughly $340M can only be completely replaced every 42.5 years.

13 NAVSEA TMDE PROGRAM FUNDING PROFILE CONTROLS: SPONSOR FY02FY03FY04FY05FY06FY07FY08 FY09 N76 OPN 3272,4423,2682,9702,8002,8512,9052,956 N77OPN1,1091,0851,3051,3381,3021,3301,3511,376 N78OPN1,7911,7524,2682,0862,0752,1122,1522,191 N096 OPN N091 OPN N43 OPN 1,5941,5521,6501,6931,7401,7721,8061,840 N43 O&M,N N6 OPN ,241 1,266 1,286 1,311 SCN *524 *730 * * * * * * *SCN ANNUAL FUNDING AMOUNT AND SOURCE DETERMINED BY SPECIFIC PLATFORMS IN THE SCN OUTFITTING PHASE NOTE: THE ABOVE FUNDING PAYS FOR GPETE AND CALIBRATION STANDARDS EQUIPMENT AND PROGRAM LABOR COSTS

14 NAVSEA TMDE PROGRAM FY($M) Tot Emergent Technology Standard/Modern Maintenance Initiatives Budget Totals for all Initiatives Projected Budget Requests

15 NAVSEA TMDE PROGRAM Projected Cost Avoidance by test equipment family

16 NAVSEA TMDE PROGRAM Standardization Initiative To implement Fleet wide GPETE modernization by using standardization within families of test equipment that perform similar basic functions. Procurements over time has resulted in a variety of models that perform similar functions. This has created a huge footprint for logistics support. We have broken down our approximate 900 individual equipment types into functional groups. This provides opportunity to consolidate models as well as defined SCAT codes relative to maintenance. The analysis has been completed for the first two groups, oscilloscopes and digital multimeters.

17 NAVSEA TMDE PROGRAM Standardization Construct Process Organization 77 Measurement Discipline (functional) Groups Lifecycle Management Plan for Each Group Long Term Budget Plan Technical Evaluation FY02/03 - Scopes & Meters Scopes - (12 SCATs to 3, 71 Models to 6) DMMs - (38 SCATs to 15, 241 Models to 35) FY04 - work planned Function and Signal Generators, Frequency Counters, & Megohmmeters

18 NAVSEA TMDE PROGRAM Class Standard Allowancing Initiative This effort incorporates a methodology by which test equipment requirements across particular ship class or like operational shore activities are optimized to incorporate cost-of-ownership concepts by overall inventory standardization. This process provides an efficient and effective means for inventory control, equipment modernization and configuration management

19 NAVSEA TMDE PROGRAM class allowancing sample – partial MCM construct

20 NAVSEA TMDE PROGRAM Calibration Standards Modernization –To define and standardize the NAVSEA process for determining laboratory standards allowances and the associated procurement policy Establishes the roles and responsibilities assigned by NAVSEA to support TMDE calibration functions. Re-initiates Laboratory Allowance Reviews Performs Production workload analysis Identifies candidates for modernization

21 NAVSEA TMDE PROGRAM Major/Management Issues –Lack of OM & N Funding adversely impacts on available labor to perform engineering functions –Lack of OPN Funding adversely impacts on program’s ability to match execution to Fleet requirements