By Geoff Fein
With budget pressures looming on the horizon, one big question for the Navy and industry partners is how they will build more ships, according to a service official.
“One of the things that you absolutely have to do is to make sure that there is confidence in our collective, the collective being Navy programs and the shipbuilders ability to build ships on cost and on schedule with the capability that you need in them,” Rear Adm. William Landay, program executive office ships, told Defense Daily recently.
“That’s been a positive story. We are moving in the right direction. I think across all the ship classes we are able to build good quality ships,” he added. “We are continuing to drive construction times down, we are continuing to drive costs in the direction we want to drive them.”
But the Navy is not as far along as it would like to be, Landay noted.
“I think our real challenge is how we continue across the enterprise, not at just an individual shipyard but across the whole portfolio, how we continue to work with industry to drive costs out of our programs,” he said.
Some of the things PEO Ships is looking at and is working very hard on is how to take advantage of the total buying power that the program office has, when it comes to buying engines or steel or other material items, Landay said. “We have traditionally done that program by program and yard by yard.”
Within programs there are opportunities for the Navy and industry to work together to drive cost out, Landay said. That, in turn, starts to give the Navy the ability to buy more ships because costs have been driven out, he added.
“I will tell you our primary emphasis in many cases has been in the four areas of how do we continue to work efficiencies in the shipyards, with the shipyards; how do we look at material costs for both combat systems, HM&E (hull, maintenance and engineering) and steel to take advantage of our buying power to get better prices out of those; what can we do to work with the yard to drive overhead down; and what can we do to drive total ownership cost down and in the construction side to drive lifecycle costs down,” Landay said. “Quite frankly, how do I get best practices in a competitive industry to spread across the industry?”
So one of the biggest challenges PEO Ships has, Landay added, is trying to take a best practice from one shipyard and get it spread across the industry.
“Because, in the end, I am interested in all of the ships we build, and that’s a very difficult thing to do in a competitive environment,” he said. “We spend a lot of time working with the yards to figure out how we can do [that]. I think there is some real potential there.”
Every one of the shipyards does certain things really well, Landay added. “You’d like to build the virtual perfect yard, that is the leader in all of those things, and the way you really do that is to find a way to spread those best practices.
“That’s what we are focusing on a lot; those are the things, quite frankly, I spend my time on, [that] seem to be my biggest challenge,” he said. “When things are OK, how do you get them to be better? When there is a crisis, everybody goes and works on the crisis. A few years ago, there were probably a lot of crises.”
Collectively, industry and the Navy have moved in the right direction, Landay said. “But how we continue to move in that direction and continue to get better is where we are really putting a lot of our emphasis going forward.”