Original Date: 08/07/1995
Revision Date: 01/18/2007
Information : Commercialization
To address the growing need for acquisition reform and streamline the acquisition process, Lockheed Martin Tactical Aircraft Systems (LMTAS) has proposed to apply commercial business practices to its existing F-16 production program under a pilot plant program. This commercialization approach goes well beyond the current acquisition reform efforts and will require Department of Defense (DoD) sponsorship and legislative guidance. This proposal will provide potentially significant savings and aggressively address the increasing interest in commercialization.
The existing F-16 baseline will allow for valuable benchmarking of acquisition reform and provide a measurement of true savings using commercial practices. Some processes in this pilot program include process controls, and continuous improvement, and the elimination of DoD oversight. The plan also includes transitioning all Government Furnished Equipment to Contractor Furnished Equipment for all commercial operations, and the establishment of commercial partnerships with suppliers. Commercial practices and operating concepts are proposed to replace DoD- specific requirements. Essentially, LMTAS proposes that the government control the performance requirements, while it controls the details of implementation. With this pilot program, LMTAS is essentially guaranteeing a reduced price for a proven product, the F-16, and also for new aircraft procurements.
LMTAS× pilot plant approach has the potential to be a pathfinder for broad acquisition reform. It is a unique approach to implement commercial practices into defense procurement, and provide a viable alternative to enhance the defense industry.
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