United States General Accounting Office

GAO Report to Congressional Committees

October 1997 ARMY EQUIPMENT

Management of

Weapon System and

Equipment

Modification Program

Needs Improvement

GAO/NSIAD-98-14

GAO United States

General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-277792 

October 10, 1997

Congressional Committees

The Army is continually modifying its fielded equipment to add new

capabilities or overcome safety and operational deficiencies. This report

discusses the Army’s management of its multibillion-dollar modification

work order (MWO) program, under which it upgrades fielded weapon

systems and other equipment.1

 Specifically, we determined (1) the

availability of information needed by Army headquarters and field

personnel to effectively oversee and manage the MWO program, (2) the

availability of spare parts needed by personnel in the field to maintain

modified equipment, and (3) field personnel’s experiences in implementing

the MWO program. Due to data limitations, we relied extensively on

interviews with Army personnel at all levels and on our observations at

field locations to obtain this information. We are addressing this report to

you due to your oversight responsibilities for government management

and/or readiness.

Background The Army established the MWO program to enhance the capabilities of its

fielded weapon systems and other equipment and correct any identified

operational and safety problems. Modifications vary in size and

complexity. For example, for a modification to the Bradley Fighting

Vehicle, the Army is adding the driver’s thermal viewer to improve

visibility during night-time and all-weather conditions, the battlefield

combat identification system to reduce the potential for friendly fire

casualties, and the global positioning receiver and digital compass system

to improve navigation. In contrast to this major modification, the Army is

adding updated seat belts to its fleet of High Mobility Multipurpose

Wheeled Vehicles to improve safety.

The Army is making a sizable investment to modify its fielded equipment.

For fiscal years 1995-97, the Army received $5.1 billion for all of its

modification programs, and the President has requested $6.7 billion for

208 modifications to the Army’s equipment for fiscal years 1998-2003.

About 80 percent of that amount is for modifications to helicopters and

other aviation items and to weapons and tracked combat vehicles.

According to Army headquarters officials, as the Army’s budget has

declined, less funding has been available for new systems. As a result, the

1

The Army manages modifications through MWOs, engineering changes, and product improvements.

The Army’s modification of equipment in the field, in a depot, in conjunction with an overhaul, or at a

contractor facility, are commonly referred to as MWO programs.

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Army will have to rely more heavily on the modification of its assets to

correct deficiencies and enhance equipment capabilities. For example, to

correct identified problems and add technological advances, the Army has

approved 95 MWOs for its Apache helicopter since fielding this system in

1986.

Management of the MWO program is shared by several Army headquarters

organizations. Each organization has a wide range of decision-making

responsibilities in developing and supporting weapon systems, which

includes modifying weapon systems and equipment through the MWO

program. The Army defined the roles and responsibilities of its

headquarters organizations and MWO sponsors in its September 6, 1990,

Interim Operating Instructions for Materiel Change Management, which

superseded Army Regulation 750-10. One of the objectives cited in the

instruction was to decentralize the management of each MWO and yet

retain overall responsibility and oversight at the headquarters level. The

instructions list numerous responsibilities for Army organizations;

however, Army headquarters officials emphasized the following key duties

for the organizations with primary responsibilities:

• The Deputy Chief of Staff for Operations has responsibility for prioritizing

the required modifications for technical and safety issues, justifying and

monitoring the overall budget, and allocating the approved funding.

• The Deputy Chief of Staff for Logistics has responsibility for overall supply

and maintenance support and for knowing the status of MWOs.

• The Acquisition Executive has responsibility over modifications to correct

or enhance the operations of weapon systems still being acquired.

• The Army Materiel Command has responsibility over modifications to

correct or enhance the operations of weapon systems that are no longer

being acquired and for other equipment items. In addition, the Army

Materiel Command is executive agent for the headquarters and, as such, is

responsible for knowing the status of MWOs and for ensuring that each MWO

is complete and conforms with Army policy and procedures before the

modification is done.

• Program sponsors2 for individual weapon systems and other equipment

items are responsible for executing each MWO—acquiring the various

components needed to modify the weapon systems and equipment, putting

2

We use the term program sponsor to include project managers of major weapon systems, such as the

Abrams tank or Blackhawk utility helicopter; weapon system managers of sustained weapon systems,

such as the Iroquois (Huey) utility helicopter; and product centers for equipment, such as the Squad

Automatic Weapon. There are numerous program sponsors, and each is responsible for managing

multiple MWOs.

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together the applicable MWO kit,3 ensuring logistical support items are

addressed, and managing the modification process on a day-to-day basis.

The MWO program sponsors for systems still being acquired are managed

under the Program Executive Office of the Army Acquisition Executive,

and the program sponsors for systems no longer being acquired are

managed under the commodity commands of the Army Materiel

Command.

In January 1997, the Army formed a process action team, including

representatives from the organizations with program management

responsibility, to study how the program could be improved. The Army

also hired a contractor to assist in evaluating how automated information

might be used to support program management. We coordinated with the

process action team and have provided the team with information as our

evaluation progressed. The process action team expects to provide its

recommendations to the Army by October 1997.

Results in Brief Army headquarters officials and Army Materiel Command officials no

longer have the information they need to effectively oversee and manage

the Army’s MWO program. This occurred because the centralized database

to track installation and funding was discontinued; control over

modification installation funding was transferred from the headquarters

level to individual program sponsors; and the authority over configuration

control boards, which ensured the completeness and compliance of MWOs

with policy, was transferred to individual program sponsors. As a result,

Army headquarters and Army Materiel Command officials do not have an

adequate overview of the status of equipment modifications across the

force, funding requirements, logistical support requirements, and

information needed for deployment decisions. The lack of information is

also a problem at field units. Maintenance personnel have not always

known which modifications should have been made to equipment or

which modifications have actually been made. In addition, maintainers of

equipment have not always received the technical information they need

in a timely manner to properly maintain modified equipment.

Maintenance personnel in the field have had difficulty obtaining spare

parts to maintain modified equipment because program sponsors

frequently had not ordered initial spare parts when they acquired

modification kits. Army headquarters and Army Materiel Command

3

An MWO kit includes the major upgraded or enhanced components; installation hardware, such as

nuts and bolts; special tools; and technical instructions on the installation of new parts and disposal of

old parts.

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officials believe these problems occurred because they lost oversight and

control of the program and policies and procedures were not being

consistently applied by the individual program sponsors. Because spare

parts have often not been available, maintenance personnel have made

additional efforts to maintain modified equipment. Also, supply system

personnel have not always followed policies and procedures to ensure that

supply system records were updated to show the addition of new spare

parts and the deletion of replaced spare parts. As a result, the Army’s

budget for spare parts may not reflect accurate requirements for new

components to repair and maintain modified weapon systems and

equipment.

Maintenance personnel in the field have also experienced a variety of

problems in implementing MWOs. For example, because multiple MWOs for

the same piece of equipment were not always coordinated, the costs of

modifications have increased, and reportable mission time could be

adversely affected at some units. Furthermore, maintainers have not

always received adequate notice of pending modifications, and as a result,

training schedules and the maintenance of equipment have been adversely

affected. Finally, we were told that various items of equipment did not

always work together once some modifications were made; hence,

improved operational capability was lost. According to Army headquarters

and Army Materiel Command officials, these problems also occurred

because of their loss of oversight and control.

Army Officials and

Field Personnel Do

Not Have Ready

Access to Needed

MWO Information

The Army does not currently maintain centralized information to track the

status of equipment modifications. Instead, it relies on the individual

program sponsors to capture the information they need to track the

separate modifications for which they are responsible. As a result, Army

headquarters and Army Materiel Command officials do not have the

information they need to effectively oversee this highly decentralized

modification program. Moreover, the information that Army headquarters

officials and maintenance personnel have for tracking modifications may

not be entirely accurate. Finally, field and depot maintenance personnel

do not have ready access to the information they need to determine

current equipment configurations, nor do they have ready access to the

technical information they need to maintain the equipment once it is

modified.

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Lack of Centralized

Information Hampers

Program Management

Individual program sponsors decide how they will track the modifications

for which they are responsible. Our review showed a variety of ways that

system modifications are tracked. As a general rule, for high-cost systems

such as M1 tanks, Bradley Fighting Vehicles, and helicopters, the

command or program sponsors established databases showing systems

that were modified and systems that were not. However, for high-density,

widely dispersed systems such as M113 armored personnel carriers,

trucks, and radios, program sponsors make very little or no attempt to

track which systems were modified.4

To carry out its management functions, the Army Materiel Command had

previously developed an integrated database to track the status of MWO

installation and funding. However, the Command quit using the system

because the Army (1) discontinued funding to maintain the portion of the

system used to track MWO installation and (2) canceled the remaining

portion of the system because it was not chosen as a Department of

Defense (DOD) standard system to track funding. As noted, a contractor is

currently studying the automated data needs of the MWO program.

The potential problems created by the lack of centralized information

readily available to Army officials to track modifications were highlighted

in a 1994 Army Audit Agency report.5

 The report pointed out that the Army

Materiel Command needed up-to-date equipment configuration

information to satisfy requirements that pertain to readiness, safety, and

compliance with laws. The report also noted that without a centralized

information system, the Command’s current and future ability to plan for

the sustainment of weapon systems was weakened. Furthermore, this

could affect the Army’s current and future readiness position and

adversely affect troop survivability.

Army Headquarters

Officials Do Not Have

Information They Need to

Properly Oversee the

Program

Army headquarters and Army Materiel Command officials responsible for

formulating the MWO program budget and for ensuring that upgraded and

enhanced equipment is available to satisfy the Army’s force structure have

limited information about what MWO funds have been spent, what

equipment has been modified, and what equipment still needs to be

modified. Due to the decentralized nature of the program, the Army

4

The program sponsors for the M1 Abrams tank and the Bradley Fighting Vehicle maintain separate

databases that show the status of the MWOs installed on equipment. For aviation systems, the MWO

program sponsors share a common database, maintained by a contractor, which shows the status of all

installed and uninstalled MWOs for each helicopter. Many other program sponsors maintain no

automated database on the status of their MWOs.

5

Modification Program, U.S. Army Audit Agency (CR 95-200, Nov. 15, 1994).

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budgets for MWOs through each program sponsor, who has discretion in

spending and transferring funds. While the data available from program

sponsors provide some information, Army headquarters officials told us

they do not have ready access to this information and that it is insufficient

to enable them to track budget expenditures.

As previously stated, not all program sponsors track the status of their

MWOs. While the information for tracked systems provides some degree of

control over the configuration, such information is not available for all

weapon systems and equipment. Moreover, headquarters officials maintain

that these individual tracking systems do not have all the information they

need to make informed decisions and are not readily accessible. The lack

of timely information on equipment configuration could have potential

adverse effects. For example, if the Army deployed a mechanized infantry

division, it would need to know the latest configuration of the division’s

tanks, Bradley Fighting Vehicles, helicopters, and trucks for mission

considerations as well as to ensure that the appropriate parts needed for

maintenance were on hand. To determine the latest configuration of this

equipment, Army officials would have to contact the respective systems’

program sponsors to determine how many tanks, Bradleys, and

helicopters of each configuration there were in the division—a

time-consuming process.

In addition, civilian aviation and Army ground maintenance personnel at

Fort Hood, Texas, and Fort Carson, Colorado, told us that the accuracy of

the databases may be suspect. For example, they said that in some

instances modified parts had been removed from aircraft such as the Huey

utility helicopter and nonmodified parts had been reinstalled. This

occurred because either the unit did so intentionally or no modified parts

were in stock when the new parts broke. As a result, the configuration of

these aircraft and ground equipment are not always accurately portrayed

in the database used by the maintenance personnel, and Army

headquarters officials would not know the current configuration for these

aircraft or ground equipment. Without the latest and most accurate

configuration information, it is difficult to ensure that deploying units have

the latest, most enhanced, and most survivable equipment. Logistics

support is also complicated because planners do not know which type of

and how many spare parts are needed to support the unit.

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Depot Maintenance

Personnel Lack

Information Needed for

Overhaul of Equipment

Depot maintenance personnel at the Anniston Army Depot, Alabama, told

us they need current and accurate configuration data to overhaul

equipment but that they do not have such data. To overhaul equipment,

they need to know whether any modifications or components are missing.

Lack of good configuration data makes it difficult to accurately estimate

the costs of overhauls and to have the proper kits and repair parts on

hand. Officials said that, as a result, they expend additional labor for

physical inspections and make allowances in their cost estimates to cover

unanticipated problems. For example, depot personnel had to visually

inspect 32 National Guard trucks in the depot for overhaul because they

had no way of knowing whether two authorized modifications had been

made when the vehicles arrived. When this happens, the overhaul program

is delayed while depot personnel order the parts or kits. However, if MWO

kits are not installed at the time the modification is made to the fleet, the

kits are often no longer available.

Field Maintenance and

Support Personnel Do Not

Have Timely Equipment

Configuration and Other

Technical Information

Field and support organization personnel also told us they have trouble

identifying what the configuration of weapon systems and equipment

should be and whether modifications have been made. They told us they

need to know whether the configuration of weapon systems and

equipment is up-to-date and what is required on the item in order to

maintain it. They said that this problem is especially acute for items that

are transferred from other units. These officials said they had sometimes

spent many hours inspecting equipment to determine its current

configuration because determining whether modifications had been done

was not easy. For example, during our visit to Fort Carson, Colorado, a

maintenance chief said that all authorized modifications on two

helicopters he had received from another geographic area were supposed

to have been made, but in preparing them for deployment, a visual

inspection showed some modifications had not been made. According to

the chief, a contractor team had to make the necessary modifications

before the aircraft could be deployed.

No tracking information and no central list of modification changes that

should have been made are available for equipment with lower dollar

values, like trucks. According to field personnel, the only way to

determine the configuration of weapon systems or equipment is to do a

physical inventory and compare the results to similar items that are

already assigned to the unit.

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Maintenance personnel at several locations said that an information

system that tracks both the completion of MWOs and any removal or

transfer of major components would be useful. However, they would

rather have this capability added to their existing maintenance information

system than have an entirely new information system to maintain and use.

We were told this tracking information will become especially critical in

the future as more modifications involve software revisions. Without

tracking all of the MWO changes, removal or transfer of major components,

and software revisions, the configuration data recorded in the information

system will be inaccurate.

Field and support organization personnel told us that they also need

up-to-date technical information to maintain equipment. The Army’s

interim guidance requires technical publications to be updated and

distributed to field locations before modifications are made. However,

maintenance personnel from Fort Hood, Texas, and Fort Campbell,

Kentucky, told us that technical manual updates are published only on a

yearly basis and that they do not receive updated technical publications in

a timely manner. If the modification and resulting configuration change

occur between updates, the unit may have to wait months before receiving

the updated technical information. This delay not only prevents

maintenance personnel from using the latest techniques to troubleshoot

equipment but it may also result in wasted effort and impede supply

personnel from ordering the correct repair parts.

A division aviation maintenance officer at Fort Campbell cited several

instances in which the lack of up-to-date technical manuals caused wasted

effort or delayed the installation of the modification. For example, in

July 1996, when division maintenance personnel modified the fuel

subsystem on the Apache attack helicopter, they did not receive revisions

to the supply parts manual. Subsequently, the aircraft was grounded and

the maintenance team wasted many hours troubleshooting because the old

manual did not identify the new fuel transfer valve. This new part would

have been identified in the revised manual. In another instance, they had

to delay the installation of the embedded global positioning system on the

Apache by 2 weeks because the Apache program office did not provide

changes to the maintenance test flight and operator manuals.

Army Units Do Not

Always Have Ready

Access to Spare Parts

The Army sometimes loses portions of its enhanced equipment capabilities

achieved through equipment modifications because Army units cannot

always obtain spare parts for its modified weapon systems and equipment.

This occurs because program sponsors do not always order initial spare

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parts for the supply system when they procure MWO kits. Furthermore,

they do not always modify the spare parts that are at the depot and unit

level to the configuration of the new component. Army officials reviewing

the MWO program believe that these problems occurred because Army

regulations are not clear about whether program sponsors are supposed to

provide initial spare parts when they acquire the MWO kits. As a result,

Army units increase their efforts to keep equipment operational and ready.

In addition, program sponsors and supply system personnel do not always

follow policies and procedures to ensure that supply system records are

updated to show the addition of new items and the deletion of replaced

items. When the supply system records are inaccurate, the Army’s budget

may not reflect accurate requirements for new spare parts to repair and

maintain modified weapon systems and equipment.

Spare Parts for Modified

Equipment Are Difficult to

Obtain

Some program sponsors have not used their limited funds to order initial

spare parts for the supply system, according to Army officials responsible

for the management of the MWO program. Ideally, initial spare parts would

be provided to bridge the gap between the modification of equipment and

the entrance of the replenishment spare parts into the Army’s supply

system. Providing initial spare parts at the time of modification is needed

because the supply system can take 18 to 24 months or more to provide

replenishment spare parts, according to aviation supply representatives.

According to Army civilian aviation maintenance personnel at Fort Hood

and Army aviation and ground maintenance personnel at Fort Carson and

Fort Campbell, program sponsors did not always modify spare parts at

unit and depot locations when equipment was modified. For example, we

were told that the Apache attack helicopters were being modified with an

improved fuel subsystem, but at least four major components were not

available in the depot supply system. As a result, aviation maintenance

personnel had to take parts from five MWO kits intended for other aircraft.

This MWO had been ongoing for 15 months. Aviation personnel said this

occurred because at least some portion of the components stored at the

depot had not been modified to the new configuration.

One program sponsor told us his office was not required to buy initial

spare parts or modify parts located at depots when they modified

equipment in the field. However, the Army’s interim operating instructions

require program sponsors to ensure all necessary integrated logistical

support parts items are addressed. Furthermore, according to Army

Regulation 700-18, ordering initial spare parts is part of the total integrated

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logistical support package for systems and end items. This regulation,

which does not specifically refer to modifications, requires program

sponsors to coordinate logistical support requirements with all agencies

and activities concerned with initial materiel support for weapon systems

and equipment. According to Army headquarters officials, both the interim

guidance and the regulation require program sponsors to provide initial

spare parts and to modify spare parts, but neither may be clear enough to

ensure that all program sponsors do it for modifications. In addition, Army

headquarters officials told us that when the Army Materiel Command used

configuration control boards, comprised of technical and administrative

representatives, to ensure the MWOs were complete and conformed with

Army policies and procedures, the need to buy spare parts was part of the

approval process. The Army Materiel Command lost this quality control

when the reviews were decentralized to the program sponsors.

Army personnel at the four locations we visited told us that they had to

take additional measures to support their equipment because they had

experienced problems obtaining spare parts. They stated that if spare

parts were not available, they took components from MWO kits. For

example, the only way to obtain spare parts for the new fuel control

panels—part of the Apache attack helicopter fuel crossover

modification—was to take them from kits that were needed to modify

other Apache helicopters. In addition, they had obtained parts outside the

normal supply system by fabricating parts locally and by buying parts

directly from contractors with local funds. These activities have led to

higher costs and reduced efficiencies at units we visited.

Management of MWO

Program Contributes to

Inventory and Budget

Errors

In reviewing 73 MWO cases, we attempted to determine whether the Army

had properly phased out old spare parts and added new items to its supply

system to support newly modified equipment. Because the Army does not

have an automated list of major components in MWOs, we encountered

difficulties in trying to make this analysis and could not identify a

significantly large number of the major components. We compared

information on those major components that we could identify with the

Army’s budget justification report and inventory records and found many

irregularities. For example,

• national stock numbers had not been assigned for some components;

• some items with national stock numbers could not be tracked into the

supply system; and

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• relationship codes, which show whether old items are to be phased out of

the supply system, were not always assigned.

We were unable to measure the impact of these irregularities from our

relatively small sample of MWOs; however, we believe that they indicate

long-standing weaknesses in the Army’s management of spare parts. For

example, using a larger universe, we reported on similar errors in the

Army’s budget justification report in December 1995.6

 In that report, we

noted that the Army’s budget justification report for spare parts contained

numerous errors, including errors in the relationship codes and inaccurate

records for items being repaired at maintenance facilities. We reported

that as a result of the errors, the Army lacks assurance that its budget

requests represent its actual funding needs for spare parts.

Field Maintenance

Personnel Experience

Problems in

Implementing the

MWO Program

Field maintenance personnel cited numerous problems in modifying their

weapon systems and equipment. For example, they stated that (1) the

completion of multiple MWOs on the same piece of equipment is not always

coordinated, or not all equipment is modified at the same time; (2) they do

not always receive adequate notice of MWOs; and (3) modified equipment

does not always work together with other equipment once the

modification takes place. As a result, they believe some units are losing

equipment capability or experiencing reduced reportable mission time, the

cost to install MWOs is increasing, and the training of unit personnel may be

adversely affected. Army headquarters and Army Materiel Command

officials believe these problems are also occurring because of their loss of

oversight and control over the program and the inconsistent

implementation of policies and procedures by program sponsors,

especially in negotiating fielding plans with the affected organizations.

Difficulties Encountered

by Unit Maintenance

Personnel

Maintenance personnel told us that the completion of multiple MWOs on

the same equipment is not always coordinated. For example, the National

Guard is testing a program to place some of its equipment in long-term

preservation storage. Equipment in long-term storage testing at the Camp

Shelby, Mississippi, mobilization and equipment training site has been

taken out of storage several times so modifications can be made. As a

result, the program was disrupted, and additional labor hours were

expended, according to a National Guard official. The lack of coordination

in the future could have even greater cost implications because the Guard

6

Army Inventory: Budget Requests for Spare and Repair Parts Are Not Reliable (GAO/NSIAD-96-3,

Dec. 29, 1995).

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is planning to place 25 percent of its equipment in preserved storage and if

it implements recommendations we are making in another report,7

 the

Guard would put an even larger percentage in storage.

In another example, an aviation maintenance chief told us that two

labor-intensive modifications were planned for consecutive years on each

of 33 Blackhawk utility aircraft belonging to two units at Fort Carson. He

said that making both modifications concurrently made more sense. Since

a modification causes an aircraft to be grounded, the additional downtime

to install each modification consecutively would adversely affect the

reportable mission time for each unit.

Maintenance personnel also noted that inefficiencies had resulted when

not all modifications were done at the same time. For example, when the

Army upgraded the armament fire control system on the M1 tank at the

Camp Shelby mobilization and training site, a contractor team installed

new software cards in the fire control system and 2 months later, a team

from the Anniston Army Depot made needed mechanical adjustments to

the same tanks. According to Army officials, both functions could have

been done at the same time, thereby reducing the time the unit was

without its equipment.

The direct support maintenance chiefs and general support maintenance

personnel at Fort Hood and Fort Carson told us they did not always

receive adequate notice of modifications. This situation disrupted their

ability to meet training schedules that were set up 12 months in advance

and interfered with their ability to maintain their equipment.

After some modifications are done, some equipment does not always work

together properly, according to aviation maintenance personnel at Fort

Hood. For example, although civilian aviation personnel at Fort Hood

modified the Blackhawk utility helicopters to work with night vision

goggles, they could not get replacement radios from a different program

sponsor that were compatible with the night vision goggle system, and

night operational capability was lost.

Army headquarters and Army Materiel Command officials believed these

problems had occurred because of their loss of oversight and control over

the program and the inconsistent implementation of policies and

procedures by program sponsors. The Army’s Interim Operating

7

Army National Guard: Sharing Unit Training Equipment Would Help Avoid Maintenance Costs

(GAO/NSIAD-97-206, Sept. 29, 1997).

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Instructions for Materiel Change Management requires individual program

sponsors to prepare a fielding plan for each modification. The fielding plan

calls for coordination and adequate notice when a modification is to be

done.

Conclusions The highly decentralized nature of the MWO program underscores the need

for Army headquarters officials to have ready access to program data and

information and adequate management controls to ensure that program

implementation complies with policies and procedures. Even though the

database they used was discontinued in part because it was not accepted

as a standard DOD system, Army headquarters officials told us that the

unavailability of information on the status of MWOs, the status of funding,

and the configuration of weapon systems and equipment has made it

difficult for managers at all levels to effectively carry out their respective

responsibilities and make informed decisions on such things as funding,

deployment, and logistical support of weapon systems and equipment.

The program sponsors have been inconsistent in providing initial spare

parts, ensuring that spare parts are added to the supply system, and

keeping technical information updated for the field maintainers.

Furthermore, program sponsors have not always adequately coordinated

the completion of MWOs with other sponsors and with the field

maintainers. The Army guidance on these processes is not clear, and the

headquarters’ ability to ensure that existing policies and procedures were

complied with was diminished when the responsibilities of configuration

control boards were transferred to program sponsors. As a result, field

maintainers have experienced difficulty in obtaining spare parts and

current technical information and have experienced inefficiencies in

getting their weapon systems and equipment modified.

Program sponsors have varying amounts of information on their MWOs,

ranging from none to fairly complete, and do not have ready access to

information needed to coordinate with other program sponsors. Those

program sponsors without a database are limited in managing their own

programs. Field maintainers do not have easy access to information on

MWOs that should have been installed or scheduled for future installation.

At the unit level, the lack of information has manifested itself in various

inefficiencies related to the coordination and scheduling of the installation

of MWOs and has sometimes prevented units from knowing the

configuration of their equipment. It is important that these modifications

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be done as efficiently as possible to minimize the reportable mission time

the equipment is unavailable to units.

The Army’s creation of a process action team to develop revised policies

and procedures and its hiring of a contractor to examine automated

information needs are steps toward correcting the weaknesses noted in

this report. Improved management of this program would provide more

assurance that improved capabilities are effectively and efficiently

integrated into the Army’s equipment in the most expeditious manner.

Recommendations In considering the upcoming results of the MWO process action team, we

recommend that the Secretary of the Army

• direct actions necessary to provide managers at all levels ready access to

the information they need to oversee, manage, and implement the MWO

program and to ensure compliance with Army policies and procedures;

• clarify regulations to ensure that program sponsors and supply system

personnel provide proper logistical support for modified equipment,

including (1) ordering appropriate initial spare parts when MWO kits are

ordered, (2) updating technical information and providing it to units when

MWO kits are installed, and (3) properly phasing out old spare parts and

adding new items to its supply system; and

• establish an effective mechanism for program sponsors to coordinate and

schedule their MWOs, among themselves and their customers, to reduce the

amount of manpower and to minimize the reportable mission time

required to complete the MWOs.

Agency Comments In written comments on a draft of this report, DOD concurred with our

findings and our recommendations (see app. I), acknowledging that

improvements to the weapon system and equipment modification program

were needed. Regarding our first recommendation, DOD agreed that

managers at all levels need ready access to information to oversee,

manage, and ensure compliance with Army policies and procedures. It

noted that the process action team is developing a recommendation for an

MWO integrated management information system that would obtain

information from already established databases. DOD believes that such a

system would provide a cost-efficient, nonlabor-intensive management

tool to assist managers in tracking all facets of MWOs. Approval of a

proposal for a new study effort to design and develop this system is

pending.

Page 14 GAO/NSIAD-98-14 Army Equipment
B-277792 

DOD also agreed with our recommendation that the Secretary of the Army

clarify regulations to ensure that program sponsors and supply system

personnel provide proper logistical support for modified equipment. DOD

stated that Army Regulation 750-10 is being totally revised to clearly define

roles and responsibilities, thereby making it a joint acquisition and

logistics regulation that can be used by both communities. The revised

regulation will adopt a modified materiel release process that would

address the logistical support issues raised in our recommendation as well

as other areas of concern identified by the process action team.

Finally, DOD agreed with our recommendation that the Secretary of the

Army establish an effective mechanism for program sponsors to

coordinate and schedule their MWOs, among themselves and their

customers. DOD stated that the revised Army Regulation 750-10 will

address the issue of coordination between program sponsors and ensure

that MWOs are completed at all units at one location at the same time where

possible.

We believe that these actions, if properly implemented, will help to further

improve the effectiveness and efficiency of this program.

Scope and

Methodology

We interviewed officials and reviewed program records at the Army

Materiel Command, Alexandria, Virginia; the Army Aviation and Troop

Command, St. Louis, Missouri; and the Army Tank-Automotive and

Armament Command, Warren, Michigan, to identify how the MWO program

works and to identify any problems. We also interviewed officials and

reviewed records at the U.S Army Materiel Command; the Assistant

Secretary of the Army for Research, Development and Acquisition; the

Deputy Chief of Staff for Logistics; and the Deputy Chief of Staff for

Operations at Army headquarters to determine their role in the

modification program and what information they need to manage funding,

resource allocations, deployment decisions, and supportability.

We also interviewed Directorate of Logistics personnel and general and

direct support personnel, reviewed records, and made on-site observations

at Fort Hood, Texas; Fort Campbell, Kentucky; and Fort Carson, Colorado,

to determine whether they were having any difficulties with the

completion, scheduling, or supply support obtained for MWOs. In addition,

we interviewed civilian and contractor personnel that provided regional

aviation maintenance support at Fort Hood and Fort Campbell and

reviewed records to determine whether they were experiencing similar

Page 15 GAO/NSIAD-98-14 Army Equipment
B-277792 

problems. Furthermore, we interviewed officials at Anniston Army Depot,

Alabama, and Camp Shelby, Mississippi, to determine how the MWO

programs affect maintenance and overhaul programs.

To evaluate how well the Army integrates its MWO program with the supply

support system, we judgmentally selected 73 recent MWOs for aviation

systems; weapons and tracked combat vehicle systems; and small arms.

The Army does not have a complete list of MWOs, MWO kits, or the major

components in the kits. It has automated data only on MWOs for high-dollar

weapon systems. For the MWOs selected, we attempted to manually identify

the major components in the kits, enter them into a database, and compare

them to the Army’s automated inventory (April-June 1997 master data

record) and budget justification (Sept. 1996 budget stratification report)

records.

We were not able to quantify the problems with the supply system

identified in this report because (1) we could not identify a significantly

large universe of new replacement items and match them with the related

item being phased out of the system and (2) for the items identified, we

could not consistently trace them into the automated inventory and budget

justification records. Furthermore, we could not determine the extent of

some of the problems identified through our field visits because some of

the newer MWOs in our sample have not been operational long enough for

their parts to fail.

We have used the automated budget justification records and automated

inventory databases in prior evaluations and reported that they contain

significant errors regarding the relationship codes between secondary

inventory items being added to the system and the replaced items.8

 These

databases are, however, the only available information on inventory and

budget justifications for Army secondary items.

We performed our review between January 1996 and August 1997 in

accordance with generally accepted government auditing standards.

We are sending copies of this report to the Secretaries of Defense and the

Army; the Director, Office of Management and Budget; and other

interested parties.

8

Defense Inventory: Shortages Are Recurring, but Not a Problem (GAO/NSIAD-95-137, Aug. 7,

1995) and Army Inventory (GAO/NSIAD-96-3 Dec. 29, 1995).

Page 16 GAO/NSIAD-98-14 Army Equipment
B-277792 

Please contact me on (202) 512-5140 if you have any questions concerning

this report. Major contributors to this report are listed in appendix II.

Mark E. Gebicke

Director, Military Operations

 and Capabilities Issues

Page 17 GAO/NSIAD-98-14 Army Equipment
B-277792 

List of Congressional Committees

The Honorable Fred Thompson

Chairman

The Honorable John Glenn

Ranking Minority Member

Committee on Governmental Affairs

United States Senate

The Honorable James M. Inhofe

Chairman

The Honorable Charles Robb

Ranking Minority Member

Subcommittee on Readiness

Committee on Armed Services

United States Senate

The Honorable Steve Horn

Chairman

The Honorable Carolyn B. Maloney

Ranking Minority Member

Subcommittee on Government Management,

 Information, and Technology

Committee on Government Reform

 and Oversight

House of Representatives

The Honorable Herbert H. Bateman

Chairman

The Honorable Norman Sisisky

Ranking Minority Member

Subcommittee on Readiness

Committee on National Security

House of Representatives

Page 18 GAO/NSIAD-98-14 Army Equipment
Page 19 GAO/NSIAD-98-14 Army Equipment
Appendix I 

Comments From the Department of Defense

Page 20 GAO/NSIAD-98-14 Army Equipment
Appendix I 

Comments From the Department of Defense

Page 21 GAO/NSIAD-98-14 Army Equipment
Appendix I 

Comments From the Department of Defense

Page 22 GAO/NSIAD-98-14 Army Equipment
Appendix II 

Major Contributors to This Report

National Security and

International Affairs

Division, Washington,

D.C.

Carol Schuster

Nancy Ragsdale

Kansas City Field

Office

Gary Billen

Mark Amo

Leonard Hill

Robert Sommer

Robert Spence

(703182) Page 23 GAO/NSIAD-98-14 Army Equipment
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