DoD Recognizes Two Lockheed Martin Initiatives for Achieving Significant Acquisition Reform
FORT WORTH, Texas, September 30th, 1998 -- Lockheed Martin has once again been recognized for making acquisition reform a reality in the defense industry.
In its second annual SPI Recognition Program, the Department of Defense selected Lockheed Martin Tactical Aircraft Systems for significant achievements in two of the six categories presented – "High-payoff Processes" and "Supplier Mentoring."
The award recognizes "Single Process Initiative (SPI)" programs initiated by the onsite industry/government Management Councils at defense contractor facilities. The SPI process was established by the DoD in late 1995 to allow contractors to replace military specifications and standards with the less costly counterparts used by commercial industry or company processes, when the new standards can be used without degrading the military product.
"We are pleased that the teamwork we have formed with both the DoD and our suppliers have resulted in innovative processes to produce real savings for current and future contracts," said Kathy Eppers, director of Enterprise Productivity at Lockheed Martin Tactical Aircraft Systems. "The SPI program is central to Lockheed Martin’s tradition of producing advanced capabilities at an affordable cost. It helps enable us to continue to offer the capabilities and cost our customers require for the F-16, and achieve the goal of affordability for the Joint Strike Fighter."
Lockheed Martin was recognized for two SPIs that resulted in savings of $1.6 million in equivalent goods and services to the government on current contracts, and a total of $6 million in savings/avoidance identified over a five-year period.
The Enhanced Data Management SPI replaces MIL-STD-1806, which required the company to submit data according to specified format and content requirements with multiple paper copies being mailed to many locations. Under the new SPI, Lockheed Martin developed a system that maximized existing technology and hardware and introduced new technologies involving the Internet to streamline the data management process. Through the use of electronic mailing techniques, a consistent contractor format and on-line availability, all customer performance requirements were met with a 80 percent reduction in cycle time.
The Parts Control & Standardization SPI replaces MIL-STD-965 and eliminates excessive levels of approval, while maintaining the level of reliability and quality needed to meet performance requirements. As a result, approval cycle time has been reduced by 40 percent. In addition, the requirement for preparation of Specification Control Drawings is now streamlined, resulting in an anticipated 80 percent reduction in preparation cycle time. Additionally, Lockheed Martin can now tailor part types considered for parts management with those having the greatest potential benefit from standardization. Included in this category are part types that reflect emerging technology and obsolescence risks.
Lockheed Martin also was recognized for implementing the SPI Subcontractor Enabling Provision. The use of this provision provides the ability to flow down fewer requirements to the suppliers, while allowing for a shorter approval cycle and minimizing the SPI processing costs. The result is lower costs for future products.
The Subcontractor Enabling Provision recognizes the significance suppliers have on the costs of fighter aircraft at the Fort Worth facility. More than 60 percent of the cost of fighter aircraft come from suppliers. The Joint Management Council decided that its initiatives must address changes in the supplier base, as well as the prime level, to maximize cost and schedule improvements. Through the provision, Lockheed Martin actively encourages and mentors subcontractors to participate in the development and selection of SPIs .
Lockheed Martin also piloted a method for processing major suppliers’ SPIs quickly and efficiently throughout the entire corporation. The result is a streamlined and less costly process to address major suppliers’ acquisition reform efforts across a broad number of companies within Lockheed Martin.
The result of the Subcontractor Enabling Provision has been a shift to performance based contracting, which has reduced the need for oversight from Lockheed Martin. More importantly, the provision provides lower costs on future purchase orders and increased trust between company and supplier. To date, more than 18 supplier SPIs have been submitted and approved.
Dain Hancock, president of Lockheed Martin Tactical Aircraft Systems, and Col. Deborah Gable, Commander of the DCMC at the Fort Worth facilities, received the award from Dr. Gansler on September 29, at ceremonies held in Fort Belvoir, Virgnia.
Lockheed Martin Tactical Aircraft systems produces the F-16, the world's most sought-after combat aircraft with more than 3,800 delivered to date to air forces in 19 countries. Lockheed Martin Tactical Aircraft Systems also produces one-third of the F-22 and is the lead company in Lockheed Martin's Joint Strike Fighter (JSF) development program. The company also participates in production of Japan's F-2 fighter and is working with Korean industry on the KTX-2 supersonic trainer project.