USA — Defense Leaders Check Progress on Efficiencies Initiatives

WASHINGTON, Sept. 23, 2010 — Defense Sec­re­tary Robert M. Gates met with top civil­ian and mil­i­tary lead­ers here yes­ter­day to dis­cuss progress on the Defense Department’s efforts to reduce over­head costs and pro­mote effi­cien­cies. The group includ­ed the ten com­bat­ant com­man­ders who lead the nation’s oper­a­tional mil­i­tary.

Defense Secretary Robert M. Gates and Navy Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, address the media during a press briefing at the Pentagon
Defense Sec­re­tary Robert M. Gates and Navy Adm. Mike Mullen, chair­man of the Joint Chiefs of Staff, address the media dur­ing a press brief­ing at the Pen­ta­gon, Sept. 23, 2010.
DOD pho­to by Navy Pet­ty Offi­cer 1st Class Chad J. McNee­ley
Click to enlarge

“It is absolute­ly crit­i­cal in our view that the [com­bat­ant com­man­ders] be involved in shap­ing all aspects of these ini­tia­tives, espe­cial­ly those that affect mil­i­tary capa­bil­i­ties, mis­sions and their orga­ni­za­tions,” Gates said today at a Pen­ta­gon news con­fer­ence. “Their con­tri­bu­tions yes­ter­day reflect their impor­tant role in our efforts.”

The sec­re­tary said he wants to ensure that those respon­si­ble for exe­cut­ing these changes and reforms “be involved in devel­op­ing both options and rec­om­men­da­tions.”

The effi­cien­cies ini­tia­tives are a team effort, Gates said, designed to instill a cul­ture of sav­ings and restraint. Mil­i­tary and civil­ian lead­ers, he added, must buy into the pro­gram for it to be suc­cess­ful.

“These lead­ers rec­og­nize the need to shift resources from over­head to real mil­i­tary capa­bil­i­ties,” he said. “They believe in the spe­cif­ic mea­sures we have announced and are com­mit­ted to imple­ment­ing them and fur­ther devel­op­ing our plan. We must all make every dol­lar count to ensure that our mil­i­tary has the forces and capa­bil­i­ties need­ed in a dan­ger­ous world.”

Gates cit­ed effi­cien­cies for the fourth lot of the F-35 joint strike fight­ers built by Lock­heed-Mar­tin as an exam­ple of what he’s try­ing to do. “After exten­sive nego­ti­a­tions, the depart­ment has reached an agree­ment to use a fixed-price incen­tive fee con­tract for the pur­chase of 30 F-35s for the U.S. mil­i­tary,” the sec­re­tary said. The con­tract also includes an air­craft for the Unit­ed King­dom and anoth­er for the Nether­lands.

The con­tract, Gates added, shares the cost of over­runs between the gov­ern­ment and indus­try up to a fixed ceil­ing. It also shares the rewards when the pro­grams come in under cost.

The per-unit price we’ve nego­ti­at­ed for this new con­tract is 15 to 20 per­cent below the inde­pen­dent cost esti­mate for the F-35 pre­pared ear­li­er this year,” the sec­re­tary said.

The con­tract as struc­tured will enhance the pro­duc­tiv­i­ty of the joint strike fight­er pro­gram to reduce over­all costs, Gates said, adding that he would like to see sim­i­lar efforts for oth­er pro­cure­ments.

Gates said he has made it clear to the department’s indus­try part­ners and defense con­tract­ing pro­fes­sion­als that defense offi­cials “need to see more of these types of con­tracts in order to pro­vide more val­ue and bet­ter pro­grams for the Amer­i­can tax­pay­ers and pro­vide good busi­ness oppor­tu­ni­ties for our indus­tri­al part­ners.”

U.S. Depart­ment of Defense
Office of the Assis­tant Sec­re­tary of Defense (Pub­lic Affairs)

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