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Program Reflections: As F-35 production grows, DCMA takes aim at DoD goals

An F-35 sits in a hanger.

For 2019, the F-35 joint strike fighter program forecast calls for more aircraft for the warfighter, lower costs for the taxpayer and more challenges for the DCMA team.

FORT LEE, Va. --

Editor's Note: This article was originally published in DCMA’s 2019 INSIGHT Magazine, which highlights the agency's global warfighter support from F-35 to foreign military sales. The online version of the magazine can be found here.

F-35 Lightning II joint strike fighter production is about to reach new heights. Low rate initial production 11, or LRIP 11, calls for 141 F-35 aircraft, which is a 67 percent increase from LRIP 10. While production numbers climb, costs continue to fall, as this production run marks the program’s lowest price per aircraft to date.

For warfighters, these numbers project increased lethality within the Navy, Air Force and Marine Corps. For American taxpayers, the reduced costs demonstrates fiscal responsibility within the defense budget. And for Defense Contract Management Agency, the workload ensures the agency’s global F-35 support network will have a busy 2019.

That network includes DCMA Lockheed Martin Fort Worth, Texas, which serves as the program’s flagship command and main production facility. There are also many additional contract management offices within the agency’s network that produce F-35 components and ship them to Fort Worth and the program’s two international Final Assembly and Checkout Facilities in Italy and Japan.

The F-35’s global supply chain receives and secures parts from across the U.S. through America’s defense industrial base and around the world through international partnerships. While en route to assembly, the parts are managed, maintained and monitored by DCMA professionals.

More aircraft translates to increased oversight, added volume within the supply chain and elevated complexity as nine of the 141 aircraft will be built in Italy or Japan. It is a significant challenge that is enhanced by the attention of working on what many consider the most high-profile U.S. defense program, as well as the F-35’s National Defense Strategy role.

“As the ‘quarterback for the joint force,’ the F-35 provides new transformational capabilities that will fundamentally change the way our nation’s military operates around the globe,” wrote Navy Vice Adm. Mat Winter, the F-35 Joint Program Office program executive officer, in a December 2018 Defense News article. “More than a fighter jet, the F-35’s ability to collect, analyze and share data is a powerful force multiplier that enhances all airborne, sea and ground-based assets in the battlespace, while ensuring our warfighters can execute their mission and return home safe. With stealth technology, advanced sensors, weapons capacity and range, the F-35 is the most lethal, survivable, connected and interoperable fighter aircraft ever built.”

All of these factors enhance the importance for one of DCMA’s great ongoing efforts — aligning its warfighter support with the Department of Defense’s Strategic Framework and its three lines of effort: Build a More Lethal Force; Strengthen Alliances and Attract New Partners; and Reform the Department. (A detailed breakdown of these efforts can be found on page 13).

Ellen Lord, the undersecretary of defense for acquisitions and sustainment, champions these efforts.
Acquisitions and sustainment is “focused on how we buy things more simply, more quickly and how we get capability downrange,” Lord said, at the 2018 JEDI Cloud Industry Day in Arlington, Virginia.

For Air Force Col. Owen Stephens, the DCMA Lockheed Martin Fort Worth commander, Lord’s goals are his focus.

“LMFW has always been aligned with Ms. Lord’s Acquisition and Sustainment priorities in that we have always concerned ourselves with doing our part to ensure a quality product is delivered on time to the warfighter and have attempted to influence the contractor to do that in a more efficient, less costly manner than is currently the case,” Stephens said.

One recent enhancement to his command priorities is a change to how his team communicates with leadership. Once only an in-house communication tool, his team now shares a data-rich metric presentation focused on the F-35 production line.

Stephens said it provides “better, real-time insight” that the quarterly Performance and Accountability Report was unable to deliver. The presentation also serves as a living document receiving strategic updates based on feedback from Lord and DCMA Director Navy Vice Adm. David Lewis.

“We do this so that we can provide DoD leaders the information they need to make informed decisions for the F-35 program,” Stephens said. “We have also been tasked to provide additional insight to answer specific needs, like the need to understand the contractor’s performance on the incentives that were put in place in the latest production contract. We have the unique ability to provide data that has been validated through personal observation so that leadership at all levels can make informed decisions. We will continue to evolve and mature our ability to provide actionable, data-rich information to leaders at all levels so they have the right information to make sound decisions.”

In its own pursuit of sound decision making, LMFW seeks efficiency and effectiveness.

“Our steadfast surveillance over the contractor is our direct contribution to ensuring the aircraft are built to spec so that they will perform in the field as designed,” said George Slagle, the DCMA LMFW deputy commander. “Our Supply Chain Management Team’s continuous oversight of the contractor’s sub-tier suppliers, supports the sustainment efforts required to maintain the production line as well as the fleet. These efforts enhance readiness.”

To accelerate business reform, Fort Worth has enhanced its relationship with the program office’s procurement contracting officers.

“We have been working with the PCOs in preparing contracts and performing surveillance on those contracts,” said Slagle. “We provide hands-on cost analyses as well as advice on billion dollar contract types to ensure the best type contract is used for the work that needs to be done.”

Outside of the PCOs, Fort Worth’s relationship building extends throughout the joint program office and even overseas.

“We are strengthening our relationships with our customer as well as with our on-site contractor to ensure lines of communication are strong and clear,” said Slagle. “We support our overseas FACO’s in Cameri, Italy, and Nagoya, Japan, which strengthens our alliances with those partner countries. It can be seen by others as a great example of how well our alliances work with our partner countries.”

The strength of the F-35 program’s alliances should receive an additional boost in 2019. According to an F-35 Joint Program Office and Lockheed Martin September 2018 press release, LRIP 11 agreement funds 91 aircraft for the U.S. services, 28 for international partners and 22 for Foreign Military Sales customers.

As the strike fighter’s workload and global footprint grows, DCMA’s workforce has increased to meet mission requirements.

“We had previously identified manning requirements based on production increases and utilized the agency manpower processes to resource those needs,” said Stephens. “Very recently, we were authorized to hire to 100 percent of requirements and that will improve our position significantly.”

The Fort Worth leader explained the agency’s manpower projections were predictive, and “all predictions tend to be inaccurate to some degree so we didn’t get everything right, and we continue to adjust our resources as necessary.”

One challenge has been concentrated on the contractor’s production plan to maintain three fully-operational shifts.

“They will be constrained if DCMA doesn’t have quality assurance support across all three shifts because there are hold inspections across the production line,” said Stephens. “Our most recent resource efforts have been about understanding that issue and adjusting our resources accordingly, which will likely mean hiring additional quality assurance personnel, and possibly form an entirely new quality assurance team.”

Maintaining product quality is important for any business, but these standards reach a new pinnacle when that product is an aircraft. The pilots, who trust in that quality every time they take off, have also faced resource constraints due to rising production numbers.

“Our pilots both accept and deliver the aircraft, and we are currently borrowing pilots from operational squadrons to handle the worldwide delivery requirement,” said Stephens. “Our 2019 goal is to be fully manned for rated positions, but we do have a number of contingency plans in place in case a service finds it difficult to fill their rated billets.”

All of these factors may capture the interest of private and public defense acquisition professionals, but for the American taxpayer, program cost is often their main focus regarding major programs. It is also a primary focus for the JPO and DCMA.

“Driving down cost is critical to the success of this program,” said Winter. “We are delivering on our commitment to get the best price for taxpayers and warfighters. This agreement for the next lot of F-35s represents a fair deal for the U.S. government, our international partnership and industry. We remain focused on aggressively reducing F-35 cost and delivering best value.”

LRIP 11 met its cost-reduction goals. Slagle believes the DCMA team played a role in that cost savings through its Integrated Cost Analysis Team, which consist of price analysts and engineers. He said the team works closely with the F-35 JPO through all phases of the pre-acquisition process, from request-for-proposal development to negotiation support.

“Most savings are achieved through ICAT proposal review recommendations that are incorporated into the Joint Program Office’s pre-negotiation objectives, which are used as a starting point to develop initial government offers in negotiations. The ICAT’s Cost and Pricing Report includes analyses on proposed material, labor, other direct and direct estimating factors, and indirect and overhead costs.”

Cost savings also result from negotiation support, which benefits all involved by often keeping required timelines on track. As delivery requirements increase, the rising tides of production will raise the importance of more than just timelines. Every aspect of DCMA’s global strike fighter support will need to rise to meet customer and Defense Department goals and expectations.

“The F-35 program is the largest program in DoD history and is one of the most complex programs that ever existed,” said Stephens. “It takes a large amount of incredibly talented people and cooperation with many stakeholders to make the pieces come together in the right way. Our team is made up of professionals from many disciplines ranging from engineers to aircrew. The thing that has impressed me most has been the ability of all functions to do their job well, recognize when information is relevant, and figure out how to present that information to all levels of the DoD enterprise in a way that is meaningful to the maximum number of stakeholders. They believe in what they are doing for our nation, and they do it well. I couldn’t be prouder of them, and what they do every day.”