There are times when “the way things are” are no longer acceptable. Radical change, with incremental and careful execution, is urgently needed within the US Navy’s Surface Ship Repair Maintenance enterprise to rectify the shortcomings of two decades of well-intentioned initiatives that rendered a majority of Surface ships neglected and ill-equipped for combat.
The problem is not wholly maintenance related – the contributing issues came about as an aggregate result of the Navy’s increased operational tempo since the start of the Global War on Terror, changes in Surface Force manning models, and disputes with Congress over the decommissioning of certain classes of ships, among other things. Recent operations in the Red Sea today are eerily reminiscent of the world in 2002 when we stretched the Navy thin to answer the nation’s call – and paid a price for decades. A recent GAO report highlighted the impact of manning shortages to ship crew’s ability to perform corrective maintenance; over 75 percent of Executive Officers stated that it was “difficult or very difficult” to complete required corrective maintenance. To address the lack of sustained success, and avoid the missteps of the past, the Surface Force and NAVSEA should employ a multi-tiered approach primarily centered on retaking control of shipboard maintenance to get us fair in the channel again.
2002-2010: MSMO and Management Failure
The story begins with the war in the Middle East in 2003. For the first time in decades, the Navy’s answer to the nation’s call to action, pushed the fleet forward, and kept it there, using its Tomahawks and Marines to enable an immensely successful land campaign. It was not by coincidence that the president chose an aircraft carrier as a platform to announce “Mission Accomplished.” The cost of that prolonged surge, however, was the deferral of a mountain of maintenance that had been scheduled for the ships and then canceled. The Navy needed to invent a way to get those ships back in service quickly and efficiently. Working with industry, the Navy developed a plan that would leverage the strengths of certain shipyards for certain types of maintenance and provide stability for the workforce by bundling multiple ships of the same class together with the idea that this would result in money savings and efficiencies in the process. This plan, called MSMO (Multi-Ship-Multi-Option) plan was implemented in the early 2000’s.
As envisioned, this plan was a good idea, however naval officers know very little about the business world. There was an implicit assumption in the execution of the MSMO plan that the Navy would save money by encouraging the industry to voluntarily decrease their bottom line. Read that again. It was never going to happen, and it didn’t happen. As a contractor following my retirement, I learned that ship repair business is just that – a business. Right or wrong, income is predicated on the Navy spending money to fix ships – any significant efficiencies in that process result in less money spent, and thus less profit. Less profit makes stockholders unhappy and drives businesses out of business.
At the same time, the Navy decided to save manpower dollars for other programs such as the Optimal Manning and Top Six Rolldown initiatives, which reduced shipboard manning and mandated the dissolution of the Ships Intermediate Maintenance Activities (SIMAs), which had been around since the early 1980s. In fact, the GAO reports that the backlog of incomplete maintenance exceeded any savings from manpower cuts that were instituted as part of Optimal Manning and other reductions in shipboard manning.
The SIMA dissolution was especially problematic since SIMAs were primarily designed to be focused on two things: leveraging Sailors on shore duty to conduct relatively minor and mid-level repairs using the expertise gained at sea and training shipboard Sailors in their technical rating. The elimination of SIMAs had a second impact: it meant all work had to go to contractors at a much higher price. While it may be true that the cost of SIMA was higher than the projected cost of giving the work to private industry – SIMA was cheaper only if you did not consider the actual cost of SIMA, e.g. salaries, facilities, etc., the Sailor cost was already spent, and the training and experience of working on equipment in-rate on shore duty is difficult to put a price tag on.
An additional phenomenon I observed was that the cadre of government planners who performed availability and maintenance planning and preparations were released and hired by contractors as this process moved to industry under the Multi Ship Multi Option (MSMO) strategy. This did not change the net number of personnel in this area, but it made the cost and scope of those with this skill set a bit more difficult to track and quantify, and may have added a cost to the process as well. In parallel, the Navy drastically reduced the footprint of an organization called Supervisor of Shipbuilding, who was basically the “overseer” designed to hold the ship builders and ship maintainers honest and uphold standards.
Around this timeframe (roughly 2007-2010), another dynamic came and went: Ship Class Squadrons, or CLASSRONs. Modeled after the Naval Aviation Enterprise, these groups were formed around each ship class and were given control of maintenance funding, acquisition processes, and current readiness. Led by sequential major commanders with experience in a specific ship class, they consolidated processes, lessons learned, assessments, and maintenance under one individual – wearing a command pin. They also tracked Class Advisories and major modifications across a focused subset of ships. As a cruiser commanding officer, I (Cordle) was overwhelmingly satisfied with the support received by the class advocate. In my specific case, the Cruiser CLASSRON Commander had held my job before, and therefore understood it.
The CLASSRON Commander had the time and bandwidth to deal with roughly 20 ships compared with the current model where one Engineering Duty Officer Captain has to process all of the maintenance information associated with over 100 ships on each coast. The CLASSRON initiative was not given enough “bake time” and would have likely produced significant dividends if left in place. This occurred in 2012 with the justification that it created a parallel C2 process and muddied the waters with respect to funding.
In an effort to improve oversight, Commander Navy Regional Maintenance Center, (CNRMC), was established in 2010 to standardize and oversee the Regional Maintenance Centers, whose processes were perceived to have drifted over the years. The goal was to place a flag officer on the waterfront with the supporting staff to police the maintenance process. While initially successful, the center of gravity of that organization has shifted to Washington and away from the waterfront. And in another manning decision, the Navy combined two flag positions, one for ship maintenance and one for modernization, placing arguably the two most complex functions in the Navy enterprise on the shoulders of one junior Flag officer. From this author’s experience, this task is too great for one individual, no matter how Herculean his or her efforts could be – they will always be pulled in two directions – one toward, and one away from the waterfront.
2011-2014: The Trends Worsen
In the early 2010s, the VADM Balisle report and subsequent GAO findings were released, indicating a dangerous trend of neglect within the Surface Force. As a result, the Navy looked to reverse course in Sailor maintenance, manpower/manning models, and Officer training – albeit this was a slow change. As an outcrop of these reports and the associated action items, the Navy implemented the Surface Engineering Maintenance Planning Project, SURFMEPP, designed to focus on life cycle maintenance, act as the “conscience of the Navy” to get ships to expected service life, which has been extended several times from 35 to 45 years over the same period.
With 2013 entered sequestration, government shutdowns, and funding shortfalls across the enterprise. During my time (Cordle) on active duty, I sat at the front table of Naval Surface Forces Atlantic time and again and signed documents that cut significant lifecycle maintenance from Surface ship availabilities because the money was not available.
To be sure, the confluence of these factors did make the MSMO more efficient, more flexible, and able to maximize the work completed, but it did not save money. The other unfortunate side effect was that a lack of rigor and uniformed oversight on the Navy side allowed companies to take advantage of the situation thereby increasing profits, although they arguably used much of the extra income to reinvest and try to grow, train, and pay their workforce in a standard capitalist model (that we laud in most other applications) – but with the Navy as their only paying customer. In the end, industry conducted themselves like any capitalist business that has to make money to stay viable. It is worth noting as background perhaps, but even before sequestration the lack of stability in the funding lines created considerable volatility in the repair community even under MSMO – the long-standing practice of underfunding surface ship maintenance and then using mid-year plus ups to close the gap to meet requirements generates its own uncertainty every fiscal year, as I experienced in my short tenure as a Type Commander Maintenance Officer in 2011 (Cordle).
Thus, the MSMO financing vehicle coupled with the elimination of SIMAs, which was initially hailed as a process designed to get the most work done (albeit at a premium price), fell victim to economics, in that the expected savings never materialized. As a result, in the decade that was the 2005 to 2015, the Surface Navy gave away its ability to fix itself and took out title loans on its ships in the form of a maintenance backlog to the tune of billions of dollars. Add to this the compounding “interest” of fewer Sailors with less training conducting shipboard self-evaluation, and you get the expected result: a rather large volume of unaddressed maintenance discrepancies aboard ships.
2015-2020:Replacing MSMO with MACMO
About halfway through this journey, in the 2010s after one or two complete change outs of the key leaders who brought MSMO to the table, a new narrative developed: civilian contractors are making too much money and keeping the ships longer to increase their bottom line. Unfortunately, rather than conduct a holistic self-analysis of the system, the Navy abruptly scrapped the MSMO concept in favor of a firm-fixed price, restrictive process that allowed a relatively small set of contractors to bid on large availabilities individually and called it another name bathed in obfuscation: the Multi Award Contract Multi Option, or MACMO, process.
Designed to cure the ills of the MSMO process by driving competition and accountability into the system, this was another good idea, but as Admiral (ret) Jesse Wilson once said, “whenever you create a new process you create new problems”. Since this was a fairly classic “top down” initiative, there was not much of an appetite for pushback or critique and not much time to shift the processes to support it. Several established and complex processes were taken on by the government, including the purchasing of long lead time materials and the complex and detailed planning process, without a robust experience base or training program in place to support it. The learning curve for this change was a steep one, and the Navy paid a price in planning and material delays during the transition to this new process.
A 2017 GAO report captured the precise cost of these manning decisions, in terms of unexecuted maintenance, in billions of dollars and millions of man-days. The graphs are eye-popping and relevant even today.
Manpower Savings were more than offset by increased maintenance costs (Source: GAO)
Now came some interesting system dynamics that while predicted, created a new set of issues when juxtaposed against the changes previously mentioned. First, the Arleigh Burke-class Destroyers (DDGs) and the Harpers Ferry-class Landing Ship, Dock ships (LSDs) entered their midlife periods, forcing maintenance availabilities to extend beyond the previous 3 to 5-month durations into durations of 12-18 months. This length change required more planning, more parts, and a larger, better trained workforce in industry, all of which were sub-optimized by the transition to MACMO.
Secondly, the Navy also revived the Coast Wide Bid process that surprised many when it actually happened to USS RAMAGE and again to USS SHOUP a few years later. Navy Manpower and manning management processes in both the active duty and civilian side are not aligned to support such endeavors.
Thirdly, Congress and the Navy treated the Cruisers and LSDs as chips in a game of poker, alternately placing them on decommissioning lists, cutting their funding to near zero, laying them up, and then trying to bring them back after a bluff has been called. This resulted in huge sunk costs, delays in critical repairs, not to mention the impact on manning and morale of crews that were “strung along” for years in a decommissioning mindset. Like trying to restore the old Ford truck that one would find in their grandfather’s pasture, this effort has grown in cost and magnitude far beyond original estimates, sucking money away from other endeavors. Delays in designing a replacement for these capital ships, which are pretty awesome warfighters, have resulted in their being kept around, with the quandary that no capital ship is as capable, nor as expensive to maintain, as our aged cruisers.
2020-Present: The Consequences
A 2020 GAO report found that “since shifting to the Multiple Award Contract-Multi Order (MACMO) contracting approach for ship maintenance work in 2015, the Navy has increased competition opportunities, gained flexibility to ensure quality of work, and limited cost growth, but schedule delays persist. During this period, 21 of 41 ship maintenance periods, called availabilities, for major repair work cost less than initially estimated, and average cost growth across the 41 availabilities was 5 percent. Schedule outcomes were less positive, and Navy regional maintenance centers varied in their performance.2 This is shown in the graph below:
Schedule delays under MAC-MO Contracting (Source: GAO)
Admiral Galinis, who later commanded NAVSEA as a 3-star, when asked at a 2015 Fleet Maintenance Seminar what changes the MACMO would bring around, he said “two things we will lose are flexibility and teamwork.” In retrospect, he was correct. Unfortunately, they were lost at a time when they were much needed. Another ingredient added to this complex system of setbacks was the ramp up of operational employment based on growing threats in the Pacific and in the Arabian Gulf. This resulted in policies of maintenance deferral and reduced certification requirements, all well documented in the Comprehensive Review of 2017.
Righting the Ship
In a 2019 article, David Larter described Navy Maintenance as a “dumpster fire.” While we do not fully agree with this dark assessment, it is definitely in need of a good overhaul. Surface Navy leaders have taken some action to help put us in a good place, including:
1. Surface Type Commanders have established a Post-Major Command Surface Warfare O-6 billet to oversee all aspects of the maintenance domain. This brings experience, oversight, and seniority to the process and is starting to pay dividends.
2. Establishment of Surface Readiness Groups – this initiative (which is not new) theoretically restores the positive attributes found in CLASSRONs. Under the Surface Readiness Group model, all ships in the Maintenance Phase are aligned under one Commodore per homeport, allowing a singular focus on maintenance and freeing up the deployed Commodores to focus on warfighting.
These are great steps to remedy the problems. Imagine if a Ford F-150 production line had to deal with a change to baseline of about 30 percent – this would be a flawed business model. Yet, this is what we ask the maintenance community to deal with every time a ship enters a yard period. To address this dilemma, the Surface Force needs to improve its scope of work planning for upcoming surface availabilities. Additionally, there should be more margin built into the schedule and price of each availability. Availabilities should start with a measure of float built in, and the Surface Force should resist the urge to plan against this float. Further, the Surface Force should acknowledge that there will be increases to scope and new work, instead of ignoring it or pretending it will not manifest. By leveraging options, frontloads, class maintenance plans, and flexible contracting, it must be possible to fund and plan for both long-term maintenance and current repairs. Things on a ship break all the time, and the process needs to be proactive vice reactive.
Additionally, the Navy should consider the following measures:
1. Treat this like the crisis that it is. Assemble a team of the most experienced people and challenge them to come up with a plan but force them to take off their functional “armor” (acquisition, modernization, maintenance, contracting, etc.) to collaborate on a new plan that is innovative, integrated, and responsible. This team should be challenged to openly discuss the best and worst parts of each model from MSMO to MACMO, Firm Fixed Price and Cost-Plus contracts. The narrative that “the utterance of the word MSMO will result in career suicide” is not helpful here.
2. Restore SIMA as a separate command. SIMAs are currently resident within Code 900 at the Regional Maintenance Centers. This construct sub optimizes SIMA’s visibility, employment, and effectiveness. Command is command; and putting a Shore Command Pin on the Commander of Ship Intermediate Maintenance would open additional command opportunities to the Engineering Duty Officer community – and consequently be good for the ships and Sailors.
3. Empower the local shipyard. Currently a Shipyard Commander has relatively no tools or levers to punish or incentivize a lead maintenance activity during a Shipyard availability. For instance, if an LMA neglects to conduct a repair within a prescribed timeline, or the work is not completed to the level of quality that it should, the shipyard has to spend exorbitant amounts of time, resources, and money to present an iron-clad case to fiscally punish the LMA. In many cases, it is more cost effective to not pursue punishment. Conversely, the Shipyard Commander has little to no way of rewarding a LMA who does a job well (on time and/or under budget). Consideration should be given to allowing the Shipyard Commander, with delegation to pertinent Project Managers, to fiscally reward or withhold a relatively small percentage of money at their level. The shipyard represents the “tactical ground commander” and observes many violations in Shipboard maintenance, and has very little ability to affect immediate change.
4. Fix the planning phase of major availabilities. On average, the amount of work during a major availability changes by roughly 30 percent after it begins. This corresponds to a range of 2,000 and 20,000 Requests for Contract Changes (RCCs) depending on the length of the maintenance period. One solution is a “Business Model Cost and Schedule” approach that was published in the Naval Engineer’s Journal in 2021.
5. Revive the good parts of the MSMO strategy to include focusing certain repair yards on certain classes of ships and providing bundled ship contracts over a period of years to allow consistency, gain some efficiencies, and train a workforce for the nation’s future. This approach does not have to be unitary in its contracting strategy but could include a more flexible pricing process described in #1 above. The contracting officers will have issues with this, but we cannot continue to build the maintenance process around the contracting process instead of around the Fleet. Many in the commercial industry have shared that a predictable and dependable income stream are critical to allowing industry to train the workforce and invest in infrastructure.
6. Leverage the goodness of processes like the Continuous Intermediate Availability (CIA) model conducted in Rota, Spain, which is similar to the old 13-week availabilities, where TYCOM-level maintenance is accomplished in short, focused maintenance periods. This could be folded into the OFRP, perhaps at the beginning of the Sustainment Phase right after deployment, and the ship return to service for a while before starting maintenance. To be sure, this initiative will have to be balanced against the need of the Operational Commander.
7. Split the Flag Officer billets for maintenance and modernization. There isn’t a single root cause for many of the current issues, nor is the problem with any particular individual. However, the move to put too many decisions on a single individual’s plate was a singularly bad move and needs to be fixed quickly.
8. Move the commander of CNRMC to Norfolk, and place a deputy in San Diego. The vision of CNRMC that was put in place by USFF in 2010 was to place a Flag Officer on the waterfront overseeing ship’s maintenance. That fundamental tenet has been lost but could be regained relatively simply. The new modernization Flag Officer can satiate the appetite in Washington for information, while their maintenance counterpart can get “boots on the ground” and start extracting ships from the yards with a crowbar instead of a 300-mile towing hawser. Of note, a similar move was just implemented with the creation of a Flag Officer billet to supervise the nuclear shipyards in Norfolk, Virginia.
9. Replicate the Supervisor of Shipbuilding model from the nuclear side at the regional maintenance centers. Empower them to provide oversight, accountability, and rigor to the ship repair process. Put teeth back into the process. Rewrite the NAVSEA Standard Item 009-060 to require contractors to provide a detailed, integrated plan that can be graphed, tracked and used to hold them to account. If there is one thing I hear over and over from Commanding Officers in the yards, it is “who is holding anyone accountable?” You can figure out the answer. No one.
10. Bring back a deployable ship repair capability to replace the Yellowstone Class Destroyer Tenders by installing a full machine repair capability (including Additive Manufacturing) into one Expeditionary Sea Base (ESB) class ship in each theater. These multi-purpose platforms have lots of space and could probably support a modular solution as well. Manning could be surged from the Regional Maintenance Centers in time of need.
This is not an argument to completely revert to the old way of doing things. This article is formulated from not just our own experiences, but multiple peers who (at least to some extent) feel the same way. One shared, “Firm Fixed Price is a great model for the commercial industry or Maritime Sealift Command, for basic maintenance on ships that are not all that complex; it is exactly the wrong model for complex warships that require expertise, flexibility, and integration – like Navy ships.”
There were many sins (including some in which at least one of us was complicit), all well intentioned, and many unavoidable over the years. But by scrapping programs that used to work, and failing to look for another solution, we will all simply admire the problem as more and more of the Fleet is tied to the pier when it is needed most. Instead, the Surface Warfare Community needs to take control of its own destiny, help the Engineering Duty Officer community do its core job, assume responsibility for the maintenance of its ships, increase command opportunity, and inject rigor, decisiveness, and accountability into a system where these words have gone out of style.
One key component of any strategy is to “take a fix.” The 2022 GAO report on maintenance backlog provides a stunning insight into the lack of accuracy and estimating the value of deferred maintenance. The amount provided to the GAO was literally off by a factor of 10 ($1.8 billion vs $180 million). This gap was then addressed by accelerating decommissioning of multiple ships which collectively represented about 80% of the gap. Unfortunately this approach addresses the immediate problem without addressing the root cause; its effect will be temporary and cannot be repeated. As today’s Carrier Strike Groups and Amphibious Readiness Groups engage in global combat operations unparalleled in modern history, with even less ships than we had during Operation Iraqi Freedom, the same forces at work in 2002 are starting to become evident, with deployments stretching to an average of over 220 days and no end in sight. Unless something changes, we are likely to find ourselves in the same position 10 years from now.
Captain John Cordle, USN, retired from the Navy in 2013 after 30 years of service. He commanded the USS Oscar Austin (DDG-79) and USS San Jacinto (CG-56), earning a Bronze Star in 2003 and the U.S. Navy League’s Captain John Paul Jones Award for Inspirational Leadership in 2010. He is a Plankowner on CVN 75 and CVN 77, where he served as Reactor Officer. He received the SNA Literary Award in 2014 and 2019, as well as the 2019 ASNE Solberg Award and U. S. Naval Institute Author of the Year Award for his contributions to fatigue management in the United States Navy. In addition to serving as Chief of Staff for Commander, Naval Surface Force Atlantic (SURFLANT), he also served as a Program Manager for Maintenance University at Hunnington Ingalls Industries and as a GS 14 Human Factors Engineer at SURFLANT, where he was recognized with the Navy Meritorious Civilian Service Award. Now retired, he is focused on leveraging his life experience to help develop future leaders.
Captain Holman Agard, USN, has a combined 27 years of service between the Enlisted and Officer ranks. He currently is serving as the Commanding Officer of USS SHOUP (DDG 86) and the Integrated Air and Missile Defense Commander for the GEORGE WASHINGTON Carrier Strike Group (CSG-5) based in Yokosuka, Japan. Previously, he served in OPNAV N96 as the Destroyers Branch Head and Ships Deputy. He also was the Executive Officer and Commanding Officer in USS HOPPER (DDG 70). He has experienced extensive maintenance availabilities in all six ships he has been stationed on.
This article appears courtesy of CIMSEC, and may be found (with footnotes) here.
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