USS New Hampshire - early and under budget

Discussion in 'Current Affairs' started by dunkers, Jun 24, 2008.

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  1. The USN has launched a new submarine 8 months ahead of schedule and $54m under budget:

    http://www.msnbc.msn.com/id/25306904/

    How do they do it? Nobody expects a British warship to be launched on time and certainly not under budget (CVF for example). So what are the Yanks doing to achieve this... bigger industry? better political support? Maybe they're just more demanding on their shipyards?

    Ideas?
     
  2. They certainly have learned some things that can allow them to do it better. Having a decent planned production run helps a lot, as does investing up from in development to get production volume benefits later, though perhaps the biggest thing is the way they actually try to reward contractors who manage to reduce costs. Also one benefit of their budget process is that once the budget is approved there is less fidling with the schedule by the DOD so all the extra costs caused by the MOD fiddling with things after the contract is let are avoided.
     
  3. Money, money, money.

    Now that they've stopped shipping palettes of notes to Iraq they have to spend it somewhere.

    Then agen, whats $54M under budget - whats the budget and what is a $54m fudge. Fcuk all I suggest, or am I just being cynical ???
     
  4. Early completion usually means that less budget is spent. Early completion is easier when the Government/Treasury/ MoD Centre don't keep trying to "re profile" the spend and find economies in the specification.
     
  5. I suspect what the USA do is tell the contractors "This is how much your getting paid to do it and we want it by this date, if you finish early you can keep the savings made, however if you finish late the costs (keeping staff on for overtime) are down to you.". My Granddad lived in the US when he was younger and said a lot of the building contracts he was involved in were carried out this way, which almost always lead to the projects being completed early.
     
  6. From what I know, that is now the basis of that the DIS is trying to impose on the UK defence industry. I know of at least 2 major contracts that have been agreed with those terms.
     
  7. That's similar to a contract I helped negotiate about three years ago, although it was a gain share agreement, they kept half of the saving. That's the direction that things are supposed to be going, but I have no confidence it'll work unless the centre can stop meddling with the approvals, and the customers can stop meddling with the requirements.
     
  8. As our American allies love to remind us,' they do it bigger and better' of course we know it's all true. =)
     
  9. On top of that, is there really enough "competition" in the British defence industry to make incentives like that workable? If you're the only contractor in the country that can produce the goods (eg British Aerospace), then there's no danger of losing the contract to someone who can do it faster and cheaper. I'm not sure deals like "finish early and you can keep the money you save" will be effective here - everyone knows that if they finish early it's only going to result in redundancies for them, since the order books for military hardware in this country aren't exactly full. What's the supposed advantage of a privatised "for-profit" defence industry again?
     
  10. It depends on which area of the market you're operating, and there is some fairly clear competition in C4, ISTAR, Special projects and quite a lot of the commoditised logistics. It's easy to get seduced into the idea that the majority of spend is in the big monolithic programmes. I can't recall the aggregated figures, which would be public domain, but in most programmes the resource expenditure is much higher than the capital, and what gets reported in the media is usually ''whole life''. A lot of that isn't going to be big glamorous set pieces, but the daily grind of things that are needed day to day; spares, clothing, food, fuel.

    On a purely shipbuilding basis I'd agree that there isn't enough dynamism in the market to make these kind of things interesting, equally the market in the UK isn't big enough to sustain any kind of healthy market. Can you imagine the tabloid horror if the CVF had actually gone to Thales? Our ships being built by the French......

    See my point above. Most of what the military environment needs is commoditised.

    Equally, do you really think it would be sensible use of the available resources to maintain a centralised state defence contractor, complete with all that surplus capacity sitting doing nothing when we're not wanting things built? Hardly sensible.
     
  11. With Commodities (like General Stores), the most efficient and economical supply is by continuous provisioning with predictable offtake. The Septics can almost do that with expensive Capital items like ships as their Navy is big enough to do it. Our Navy no longer is big enough for that and, I would suggest, has already reached the point of implosion.

    At the point where we have, as good as, rationalised to a single manufacturing consortium, it needs continuous building work to survive. Gaps between contracts simply results in laid off trained and skilled workers (including the drawing office wallahs). When you next get an order, those erstwhile shipyard workers aren't likely to give up their new taxi driving and shelf stacking jobs to re engage in temporary employment. Goodbye skills base and manufacturing capacity and capability. A similar argument holds good for aircraft building.

    Using the continuous provisioning parallel, could that be applied to UK shipbuilding? Up to a point, perhaps it could. It would mean some standardisation and not building a different design hull for each specific limited population Class. How long did the Whitby hull run for? If each ship had, say, a 25 year life, a 25 hull DD/FF force could be sustained by building one a year; not that 25 is sufficient for a Maritime Nation with worldwide economic and security interests. Applying the same principle to major warships, one LPD/LAH/CV every 5 years might work.

    Even if the practical difficulties and weaknesses of my simplistic view were ironed out, it would be unlikely to happen. It would need a Government that was interested and committed to voting sufficient funds for each and every year of the programme. No silly in year and STP re profiling exercises that employ a cast of thousands. We would then get our ships on time and in budget.

    Oh look, it's sunshining and the clouds are all fluffy.
     

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