Monitoring the Progress of Shipbuilding Programmes

As part of the annual assessment of its large projects, the Defence Procurement Agency (DPA), part of the UK Ministry of Defence, measures “slippage” — the delay between a promised in-service date and the actual or projected in-service date. In response to the slippage of some recent shipbuilding programmes, the DPA asked the RAND Corporation to analyse how major shipbuilders and contractors monitor programme progress, to consider what information would be useful for shipbuilders to provide the agency, and to understand why ships are delivered late and why commercial shipbuilders maintain a much better schedule performance than military builders do. The researchers surveyed major US, UK, and other European shipbuilders and found that earned value management was the more common method used to monitor progress. From this and other metrics and procedures observed, the researchers recommend that the DPA consider adapting some of the current commercial practices, including incentives for on-time deliveries and the use of on-site representatives to quickly resolve late decision changes. The implementation of such recommendations could reduce cost and improve schedule performance.