Defense Inventory:

Opportunities Exist to Improve Spare Parts Support Aboard Deployed Navy Ships

GAO-03-887: Published: Aug 29, 2003. Publicly Released: Aug 29, 2003.

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GAO is conducting a series of reviews in response to a congressional request to identify ways to improve the Department of Defense's (DOD's) availability of high-quality spare parts for ships, aircraft, vehicles, and weapons systems. This report focuses on the effectiveness of the U.S. Navy's spare parts support to deployed ships. It examines (1) the extent to which the Navy is meeting its spare parts supply goals, (2) the reasons for any unmet supply goals, and (3) the effects of spare parts supply problems on ship operations, mission readiness, and costs. To conduct the review, GAO looked at data on parts requisitions, maintenance work orders, and casualty reports for various Navy ship deployments between fiscal years 1999 and 2003.

In typical 6-month deployments at sea, Navy ships are generally unable to meet the Navy's supply performance goals for spare parts. GAO's analysis of data for 132,000 parts requisitions from ships in 6 Atlantic and Pacific battle groups deployed in fiscal years 1999 and 2000 showed that 54 percent could be filled from inventories onboard ship. This supply rate falls short of Navy's long-standing 65 percent goal. When parts were requisitioned, maintenance crews waited an average of 18.1 days to get the parts--more than 3 times the Navy's wait-time goal of 5.6 days for ships outside the continental United States. The Navy recognizes it has not met its supply goals for over 20 years. Two key problems contribute to the Navy's inability to achieve its supply goals. Its ship configuration records, which identify the types of equipment and weapons systems that are installed on a ship, are often inaccurate because they are not updated in a timely manner and because audits to ensure their accuracy are not conducted periodically. In addition, the Navy's historical demand data are often out-of-date, incomplete, or erroneous because supply crews do not always enter the right information into the ships' supply system databases or do not enter it on a timely basis. Because configuration-record and demand data are used in models to estimate what a ship needs to carry in inventory, inaccuracies in this information can result in a ship's not stocking the right parts for the equipment on board or not carrying the right number of parts that may be needed during deployment. While precise impacts are not always well defined, the Navy's spare parts supply problems can affect a deployed ship's operations, mission readiness, and costs. GAO's analysis of data on 50,000 work orders from 6 deployed battle groups showed that 58 percent could not be completed because the right parts were not available onboard. More complete reporting of work orders identified as critical or important would have resulted in a more complete assessment of ship mission readiness. In addition, the Navy expends substantial funds--nearly $25 million for six ships GAO reviewed--to maintain large inventories that are not requisitioned during deployments.

Status Legend:

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  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: In order to improve supply availability, enhance operations and mission readiness, and reduce operating costs for deployed ships, the Secretary of Defense should direct the Secretary of the Navy to periodically identify and purge spare parts from ship inventories to reduce costs when parts have not been requisitioned for long periods of time and are not needed according to current and accurate configuration and parts demand information.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: 08/28/07 The Navy agreed that a more comprehensive effort is needed to identify and purge excess assets and the initial effort was to be on spare parts for de-installed equipment. It reported that initiatives are underway to reduce shipboard spares inventory using existing and new tools that will trigger the identification and removal of parts not needed as a result of configuration changes. It reported that the Navy is working to align shipboard records with authorized allowances and identify excesses/offload candidates.

    Recommendation: In order to improve supply availability, enhance operations and mission readiness, and reduce operating costs for deployed ships, the Secretary of Defense should direct the Secretary of the Navy to ensure that demand data for parts entered into ship supply systems are recorded promptly and accurately as required to ensure that onboard ship inventories reflect current usage or demands.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: 11/14/03 DOD agreed that good demand reporting is essential, but identified other reasons why demand data was inaccurate and 38% of the unfilled requisitions were not in stock, including designated repair capability; results of the readiness optimization calculation used in the sparing model; and the forecasted demand falling below the sparing threshold. 03/09/05 Since the 2003 report, additional tools have been deployed to assist the TYCOMs ensure files are processed in a timely manner. Modifications have been made to on-board ADP programs and these updates have been implemented in all shipboard systems ensuring shipboard and shore files are closely aligned. In addition, reports have been implemented that provide current information on the processing status of every ship to the appropriate TYCOM that owns the ship and other interested parties.

    Recommendation: In order to improve supply availability, enhance operations and mission readiness, and reduce operating costs for deployed ships, the Secretary of Defense should direct the Secretary of the Navy to develop plans to conduct periodic ship configuration audits and to ensure that configuration records are updated and maintained in order that accurate inventory data can be developed for deployed ships.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: 03/07/05 In our report entitled: DEFENSE INVENTORY: Opportunities Exist to Improve Spare Parts Support Aboard Deployed Navy Ships (GAO-03-887, August 29, 2003), one of GAO's recommendations was that the Navy develop plans to conduct periodic ship configuration audits and to ensure that configuration records are updated and maintained in order that accurate inventory data can be developed for deployed ships. The Navy concurred with the recommendation and agreed that it needed to be more aggressive in following up on configuration changes to ensure the configuration files on board the ship match those on file in the main configuration database. A working group was established to perform a comprehensive review of the current inventory strategy and allowance processes, including configuration management. As follow-up to the status of action on this recommendation, in March 2005 the Navy reported to DODIG that it had been engaged in improving the process to ensure that the actual files on ships are updated with the latest configuration and allowancing information. It said that since GAO's 2003 report, the Navy has deployed additional tools to assist the TYPE commands in this effort. Specifically, it said that modifications have been made to provide an audit record that is embedded in every allowance file produced and sent to the ship. Also, modifications to on-board ships programs respond to this audit record automatically and send it back. It said that these updates have been implemented in all shipboard systems ensuring that the information concerning how closely aligned the shipboard system is with the shore files and is accurately reported. In addition, it said that reports have been developed that provide current information on the processing status of every ship to the appropriate TYPE command which owns the ship and other interested parties. This audit process is automatic and requires no sailor interaction beyond processing the file. It said that NAVSEA also monitors the status of ships processing on a monthly/weekly basis as well. These actions are responsive to GAO's recommendation.

    Recommendation: In order to improve supply availability, enhance operations and mission readiness, and reduce operating costs for deployed ships, the Secretary of Defense should direct the Secretary of the Navy to ensure that casualty reports are issued consistent with high priority maintenance work orders, as required by Navy instruction, to provide a more complete assessment of ship's readiness.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: GAO report identified a discrepancy between Navy guidance on high priority maintenance work orders and causality reports issued for maintenance jobs on ships. The Navy discussed our report and this finding and, in June 2004, revised its Maintenance and Material Management (3-M) Manual instruction to include a flowchart that aids in determining the correct priority code to assign on maintenance work orders. The priority code is also used as input in a formula developed for computing a Maintenance Figure of Merit, which are new business rules instituted to calculate and prioritize jobs to be completed or deferred. Benefits accrue in the more effective use of maintenance resources.

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