Air Force ADP:

Evaluations Needed to Substantiate Modernization Program Benefits

IMTEC-89-29: Published: May 5, 1989. Publicly Released: Jun 6, 1989.

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Pursuant to a congressional request, GAO reviewed the Air Force Logistics Command's (AFLC) Logistics Management System (LMS) Modernization Program, focusing on cost savings and system evaluations.

GAO analyzed 1988 Air Force evaluations of the LMS program and found that AFLC: (1) could adequately support only $1.9 billion of the $12.2 billion in cost savings it originally expected in 1984; and (2) reduced the original program's scope, but did not determine the impact of this reduction on system functionality or expected program benefits. GAO also found that: (1) AFLC estimated that program acquisition costs would total nearly $1 billion; (2) total program costs would exceed $2 billion; (3) the scheduled completion date for the total program slipped from 1990 to 1994; (4) although regulations require AFLC to prepare evaluation plans early in the development process, AFLC has prepared such plans for only three of the nine LMS projects; (5) AFLC has not established the criteria or the techniques needed to evaluate the projects; (6) AFLC has not begun any final or interim system evaluations, even though it designated two systems as fully operational and six other systems have had operational sections for over 1 year; and (7) AFLC reported that it had not begun final evaluations on the two operational systems because one system did not have the data to operate and the other was still in development.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Air Force agreed with this recommendation and indicated that it will evaluate completed systems. It has purportedly completed evaluations of two systems.

    Recommendation: The Secretary of the Air Force should direct the Commander, AFLC, to prepare system evaluation plans for all LMS modernization system projects. Where applicable, these plans should provide for interim assessments as portions of new systems become operational as well as final assessments once the entire system is complete. AFLC should provide the Secretary a timetable for completing the evaluation plan for each project.

    Agency Affected: Department of Defense: Department of the Air Force

  2. Status: Closed - Implemented

    Comments: The Air Force has provided the Office of the Secretary of Defense a schedule for completing system evaluations. The Air Force has completed final system evaluation for two projects/systems and reaffirmed the expected benefits of the systems.

    Recommendation: The Secretary of the Air Force should direct the Commander, AFLC, to expeditiously evaluate, using the evaluation plans, the two completed LMS projects and the operational portions of the other seven LMS projects. If evaluations of the two systems designated as having full operational capabilities cannot begin immediately, AFLC should provide the Secretary an explanation of why the two systems were reported as fully operational when one does not have the data to operate and the other is still in development. Until the final evaluations of these two systems have been completed, AFLC should continue to report their costs and status in all program reviews.

    Agency Affected: Department of Defense: Department of the Air Force

  3. Status: Closed - Implemented

    Comments: The Commander, AFLC, provided the Secretary of the Air Force with a timetable for completing system evaluations in January 1991.

    Recommendation: The Secretary of the Air Force should direct the Commander, AFLC, to provide the Secretary a timetable for each project showing when interim and final system evaluations will be completed.

    Agency Affected: Department of Defense: Department of the Air Force

  4. Status: Closed - Implemented

    Comments: The Air Force has completed two final system evaluations and has a schedule for completing evaluations for the remaining seven projects/systems. For the two completed systems, the evaluations reaffirmed the cost-effectiveness of the systems.

    Recommendation: The Secretary of the Air Force should direct the Commander, AFLC, to adjust project cost and benefit estimates in light of the system evaluations and, if warranted, reassess the cost-effectiveness of ongoing LMS projects.

    Agency Affected: Department of Defense: Department of the Air Force

 

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