Navy Maintenance:

Aviation Component Repair Program Needs Greater Management Attention

NSIAD-89-171: Published: Jul 6, 1989. Publicly Released: Jul 6, 1989.

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Pursuant to a congressional request, GAO reviewed the Navy's aviation component repair program, focusing on: (1) whether repair prices were well-supported and reasonable; (2) Navy efforts to improve efficiency and contain costs; and (3) internal program management controls.

GAO found that naval aviation depots: (1) during fiscal year (FY) 1988, overhauled almost 200,000 components, with revenues of about $601 million; (2) based their repair charges on standards reflecting the estimated number of labor hours that the repair required; (3) lacked or had inaccurate documentation to support 68 percent of 75 component repair charges GAO reviewed; (4) were not required to and did not analyze price variances, resulting in continuing overcharges or undercharges for some component repairs; (5) frequently charged for more labor hours than they actually used for component repair; and (6) did not comply with requirements to establish and track performance goals. GAO also found that the Naval Air Systems Command: (1) had inadequate controls to ensure that depots complied with instructions requiring accurate, current, and auditable work-load standards; (2) has not identified or corrected the causes of the depots' 13-percent decline in component repair efficiency between FY 1985 and 1988; and (3) has several major initiatives underway to improve the depots' efficiency and contain costs, but some are limited by design problems.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The Navy is developing a revised work-load standards program that will address GAO concerns. Management controls built into the revised program will include periodic reporting and on-site reviews. A new instruction implementing policy on workload standards is being finalized. By memo dated January 31, 1990, the Commander, NAVAIR, directed the naval aviation depots to comply with the instruction.

    Recommendation: The Secretary of the Navy should instruct the Commander, Naval Air Systems Command, to direct the naval aviation depots to comply with requirements that component repair prices be well-supported with up-to-date, auditable documentation. To verify compliance, the Command should make on-site audits and obtain quarterly status reports on naval aviation depot efforts to maintain the standards program.

    Agency Affected: Department of Defense: Department of the Navy

  2. Status: Closed - Implemented

    Comments: Implementation of a new variance analysis program referred to as the Variance Improvement Program for Expenditure Reconciliation was completed on September 30, 1989 as a result of accomplishment report A-NSIAD-90-11. A-NSIAD-90-12 results from congressional action to reduce industrial funds for this point.

    Recommendation: To ensure that naval aviation depots identify and analyze variances between standard and actual labor hours for individual repairs, the Commander, Naval Air Systems Command, should direct naval aviation depots to develop quarterly reports identifying variances, analyze the reasons for the variances, and make appropriate adjustments to the standards.

    Agency Affected: Department of Defense: Department of the Navy: Naval Air Systems Command

  3. Status: Closed - Implemented

    Comments: The Navy recognizes the need to apply enhanced action to the component repair program and will take appropriate steps to improve productivity and efficiency. The draft NAVAIR Instruction 5220.XX, implemented by memo dated January 31, 1990, sets up a process to measure productivity, makes comparisons between depots, determines causes of lost productivity, and institutionalizes corrective measures.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Air Systems Command, to identify the causes of the reported productivity decline in the component repair program and take appropriate action to improve productivity.

    Agency Affected: Department of Defense: Department of the Navy

  4. Status: Closed - Implemented

    Comments: Draft Instruction 5220.XX, implemented by memo dated January 31, 1990, requires the depots to establish and track performance goals. As a starting point, the Commander, NAVAIR, provided the depots with revised performance measures in December 1989.

    Recommendation: The Secretary of the Navy should direct the Commander, Naval Air Systems Command, to require naval aviation depots to reestablish and track performance goals as a means to improve efficiency.

    Agency Affected: Department of Defense: Department of the Navy

 

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