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Research Questions

  1. What type of tool could help the U.S. Air Force make sourcing decisions earlier in a weapon system's acquisition process?
  2. What kind of visualization would help Air Force planners determine which provider (organic or contractor) will be the most cost-effective and efficient option to handle repair workloads for various subsystems, and what can the Air Force learn from its legacy systems?
  3. How can the lessons from transaction cost accounting inform an economic-based framework to support these decisions, and how would such a framework be applied?

The U.S. Air Force has long struggled to incorporate new weapon system logistics requirements and support system design considerations into its broader sustainment enterprise early in the acquisition process. To help inform Air Force decisionmaking with regard to sustainment sourcing, RAND Project AIR FORCE researchers explored and adapted lessons from the transaction cost accounting literature. The result is a powerful economic-based framework that has three primary benefits when it comes to addressing sustainment planning challenges: It is a repeatable, analytically driven decision tool that does not require large amounts of data; it considers repair source decisionmaking in the context of the broader Air Force enterprise; and it is potentially applicable to other aspects of sustainment planning, such as managing government-mandated repair sourcing mixes and informing other Air Force sustainment community responsibilities. This report demonstrates how the framework can be used to select among depot maintenance strategies by applying it to the F-35 Joint Strike Fighter, the largest acquisition program in U.S. Department of Defense history. Although the U.S. government will retain the capability to perform the range of depot-level repairs for the F-35, 40 percent of the workload — known as "above core" — can be considered for sourcing to an organic Air Force facility, another military service's facility, a foreign partner, or the private sector. The framework helps planners visualize program data and compare new acquisition programs with legacy Air Force systems. In this way, it offers the Air Force additional leverage in responding to technology developments and vetting contractors' engineering, reliability, and maintainability projections for new weapon systems.

Key Findings

Decisions About U.S. Air Force Weapon System Sustainment Often Do Not Consider the Effects on the Broader Sustainment Enterprise

  • Decisions about whether to use organic or contractor support for the long-term sustainment of a weapon system are often made within narrow organizational boundaries and do not consider the full range of capabilities in the enterprise to identify a more cost-effective option.
  • A review of legacy program data also showed that this decisionmaking can be data-intensive and often occurs in isolation and late in a weapon system's acquisition process.
  • History suggests that new aircraft systems generally act similarly to legacy aircraft systems at the technology/subsystem level. For this reason, the Air Force would benefit most from common sustainment strategies at this level as it moves forward with new acquisition programs.

The Air Force Would Benefit from a Framework to Support These Types of Decisions

  • U.S. Department of Defense guidance states that above-core depot workloads (those that the government has the option to outsource) should be assigned on the basis of a best-value determination, but this guidance does not specify how to determine "best value."
  • A RAND-developed economic-based framework addresses this gap by helping planners determine the "best value" when assigning above-core sustainment workloads, but such an analytic tool would have longer-term benefits for the Air Force. For example, it can help planners compare and discover commonalities across subsystems, identify the effects of new or emerging technology on Air Force sustainment strategies, and contribute to the Air Force's mission to shape its sustainment enterprise.

Recommendations

  • The Air Force should develop an enterprise sustainment strategy at the product support group or technology subsystem level and ensure that the appropriate sustainment infrastructure is in place.
  • From there, it should adopt a set of criteria for support system design sourcing decisions that weapon system program offices can apply early in the acquisition process. Such criteria would help determine whether the enterprise has the capability to sustain the system and, if not, whether it would be beneficial to develop the capability.
  • The RAND-developed framework offers the Air Force a helpful approach to start thinking more strategically about sustainment posture planning and illuminates the advantages of an enterprise-wide view of sustainment management. The Air Force should adopt the framework as it makes decisions regarding new acquisition programs, such as the F-35 Joint Strike Fighter, and as it addresses new technology developments affecting existing programs.

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    TCA and Current Air Force Sustainment Efforts

  • Chapter Three

    Application of the Framework to the F-35

  • Chapter Four

    Conclusions and Potential Extensions of This Analysis

Research conducted by

The research described in this report was sponsored by the United States Air Force and conducted by RAND Project AIR FORCE.

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