The DD(X) destroyer is a multimission surface ship designed to provide advanced land attack capability in support of forces ashore and contribute to U.S. military dominance in littoral operations. Among its planned features is the ability to engage land targets from long ranges using its 155-millimeter guns and Tomahawk land attack cruise missiles. The ship will also feature reduced radar, acoustic, and heat signatures to increase survivability in the littorals. In November 2001, the Navy restructured the program to focus on developing and maturing a number of transformational technologies. These technologies will provide a baseline to support development of a range of future surface ships such as the future cruiser and the Littoral Combat Ship. The DD(X) program is managing risk by designing, developing, and testing 10 engineering development models for the program's critical technologies. Each of the 10 engineering development models represents an experimental subsystem of DD(X) and may incorporate more than one transformational technology. The key events in the DD(X) schedule are shown in figure 1. The program completed its system-level preliminary design review March 2004 and is currently in system design. The next major event occurs in March 2005, when the Navy will seek authority to commit research, development, test and evaluation funds for detailed design and construction of the lead ship. The program's system-level critical design review will be held late in fiscal year 2005 after the lead ship authorization and will assess design maturity. The current contract for design and development of DD(X) ends in September 2005. Further design and development activities, including detailed design and construction, will take place under a new contract to be awarded in March 2005. The Conference Report to the fiscal year 2005 Defense Appropriations Act states that the funds appropriated for DD(X) in the act are limited to design and advanced procurement requirements for the first two ships. The Conference Report further directs that no funds are available for the procurement of materials dependent upon delivery of key DD(X) technologies unless those technologies have undergone testing. The Conference Report also states that the Navy should complete land-based testing of the advanced gun system and integrated power system prior to the completion of the critical design review. The Navy is developing 12 technologies for DD(X) using 10 engineering development models. Engineering development models seek to demonstrate key DD(X) subsystems and may involve more than one critical technology (see table 1). The engineering development models are the most significant aspect of the program's risk reduction strategy. To demonstrate technologies, each DD(X) development model follows a structured approach for design, development, and testing. Initially, requirements for each of the development models are defined and recorded in a common database. The risk of not meeting these requirements is assessed and strategies are formulated to reduce these risks. Once designs are formulated, components are tested to build knowledge about a subsystem's viability. In testing, the performance of engineering development models is confirmed. It is these tests that provide confidence in a technology's ability to operate as intended. Once the technology is demonstrated, the subsystem can be integrated into the ship's system design. Our reviews of commercial and Department of Defense acquisition programs have identified a number of specific practices that ensure that high levels of knowledge are achieved at key junctures in development and used to make investment decisions. The most important practice is achieving a high level of technology maturity at the start of system development. A technology reaches full maturity when its performance is successfully demonstrated in its intended environment. Maturing a technology to this level before including it into system design and development can reduce risk by creating confidence that a technology will work as expected and allows the developer to focus on integrating mature technologies into the ship design. This improves the ability to establish realistic cost, schedule, and performance objectives as well as the ability to meet them. Including the technologies in system development before reaching maturity raises the risk of discovering problems late that can increase the cost and time needed to complete design and fabrication. The Navy's use of engineering development models to mature DD(X) technologies represents a disciplined process for generating the information needed for development, and corresponds with portions of the best practices approach. In using engineering development models, the Navy seeks to achieve high levels of technology maturity by first defining the requirements and risks of a developmental technology and then executing a series of tests to reduce these risks and prove the utility of a technology in its intended environment. The progress of technology maturity is recorded and communicated clearly through the use of established metrics, affording the program manager and others readily available information for use in decision making. The program's schedule, however, does not allow most engineering development models to generate sufficient knowledge before key decisions are made. None of the DD(X) technologies included in the 10 engineering development models were mature at the start of system design and none are expected to be mature at the March 2005 decision to authorize detailed design and construction of the lead ship. Under the current schedule, 7 of the 10 subsystems will not be demonstrated until the end of program's critical design review in August 2005 or beyond. The decision to authorize award of the contract for detail design and construction of the lead ship will thus be made before the technologies are proven and the design is stable. By the end of the critical design review, only three subsystems are expected to have completed testing: the autonomic fire suppression system, the hull form, and the infrared mockups. The integrated power system, peripheral vertical launch system, and total ship computing environment complete testing just after the critical design review. The remaining four subsystems complete testing well after critical design review or are not tested as fully integrated systems until after installation on the first ship. The Navy is aware of the risks presented by its schedule but stated that exit criteria have been established for milestone decisions which ensure requirements will be met. Program officials further stated that, according to the Department of Defense acquisition policy, technologies for ships do not have to be mature until shipboard installation. Our reviews of commercial best practices identified a second critical practice that increases a program's chances of success: achieving design stability by the system-level critical design review. For a stable design, subsystems are integrated into a product that meets the requirements of the user. Design stability requires detailed knowledge of the form, fit, and function of all technologies as well as the integration of individual, fully matured subsystems. Stability of design allows for testing to prove system reliability and leads into production planning. Most of the testing of the engineering development models will take place in the months immediately before and after critical design review and beyond. Even if the models proceed with complete success, they will not be done in time to achieve design stability at the critical design review. If problems are found in testing-as has been the case with other programs- they could result in changes in the design, delays in product delivery, and increases in product cost. Detailed knowledge about subsystems and their component technologies is necessary for developing the system design. If this information is not available and assumptions about operating characteristics have to be made, redesign may be necessary when reliable information becomes available. This can increase the schedule and the costs of system design. Unstable system design could also affect construction. Higher construction costs are likely to be incurred if work is done inefficiently or if changes result in rework. One example of the consequences of technology and design immaturity already apparent in the DD(X) program is the development of the dual band radar and its impact on the integrated deckhouse. The dual band radar consists of two separate radar technologies and will not complete testing until fiscal year 2008. Due to this lengthy period of testing, the dual band radar may not be installed until the first ship is afloat. Contractors have stated that this schedule has led to the need for increased funding. Because the dual band radar will not be fully tested by critical design review, program officials have had to make some assumptions about where in the deckhouse it will be placed. If the weight of the radar increases or if other technical factors cause it to be relocated, a redesign effort may be needed to assure that requirements are met. As the deckhouse forms a significant portion of the DD(X), redesign could have an impact on the ship as a whole. Other shipbuilding programs have developed strategies that call for maturing critical technologies while still providing decision makers with relatively high levels of knowledge at key decision points. For example, the CVN-21 future aircraft carrier program has a risk reduction strategy that defines a timeline for making decisions about a technology's maturity. The majority of these decisions are made early in the system design phase prior to the system critical design review. This should allow the system design to proceed in integrating technologies with the assurance that they will work in their intended environment. Lead ship authorization occurs after critical design review so that the maturity of the design can be demonstrated before a decision is made. The DD(X) program entered its system design phase without the majority of its technologies completing their design or component testing stage. These activities include events like design reviews for the integrated power system and damage testing on components of the peripheral vertical launch system. The only development model beyond these initial stages is the hull form, which has completed its initial tests and simulations and is now entering a second design and test phase. Testing subsystems to demonstrate whether they will work in their intended environment is scheduled to begin for most development models in fiscal year 2005 and will continue, in some cases, beyond fiscal year 2006, as shown in table 2. Four of the 10 engineering development models--the total ship computing environment, the peripheral vertical launch system, the hull form, and the infrared mockups--are progressing as planned toward demonstrating complete subsystems. However, challenges have arisen with other development models. The impact of some of these challenges has been mitigated with minimal change to the program, but others remain unresolved or have resulted in rescheduling and cost growth. Only two of the engineering development models, the hullform and the integrated power system, have fallback technologies that could be used if current technologies do not meet requirements. All other engineering development models could necessitate system level redesign if they fail to mature technologies to meet requirements. We have already noted the challenges with the dual band radar and its impact on the integrated deckhouse. Other challenges are highlighted below. Program officials agreed with our assessment of DD(X) program risks, but believe these risks can be mitigated through use of fallback technologies and design budgeting. Design budgeting refers to the practice of building in extra margins, such as weight and space, to accommodate growth as the design matures. Appendix I provides details on the status of all 10 engineering development models. The integrated power system is currently exceeding its weight allowances by a significant amount and has used up its entire additional design margin for weight. This means that any further increases in weight could affect other systems or result in an unplanned and unbudgeted weight reduction program. The power system has also experienced some software compliance issues with the total ship computing environment. Program officials have defined the software issue and are working toward a solution. In addition, the testing schedule for the power system has been altered due to changes to the dual band radar. Program officials had planned to test the two subsystems together in at-sea tests on a surrogate vessel. When the delays in testing for dual band radar occurred, at-sea tests for the power system were cancelled. To compensate for the loss of knowledge that was to be gained by this testing, the program office plans for increased fidelity in land based testing. Plans for the integrated power system do include the use of a fallback technology. Use of the technology would require some trade-offs in performance, weight, and noise requirements. In their comments on this report, the Department of Defense stated that the Navy has allocated additional margin from the total ship design to account for weight growth in the integrated power system. While this adjustment in overall ship margin does not directly impact the overall ship design, it may leave less space for future growth in other systems. While the early tests of the autonomic fire suppression system exceeded expectations, by sustaining significant damage and still controlling the fire, some challenges have arisen that delayed later testing. Like the power system, the fire suppression system experienced compatibility issues with the total ship computing environment. These issues have been recognized and the program office has identified solutions to resolve them. These software compatibility issues caused a delay in the system tests that pushed their completion beyond the system-level critical design review. The current testing plans for the integrated undersea warfare system include testing of the dual frequency sonar array for internal interference, the ability of the high frequency portion of this array to detect mines, and the software necessary to integrate all functions and reduce the sailor's workload. Though these tests may prove the functionality of components and technologies within the undersea warfare system, they do not demonstrate the system as a whole. As a result, when the current series of testing concludes in May 2005, the undersea warfare system will not have demonstrated operations in the intended environment. While development of the advanced gun system is proceeding as planned and has even overcome early challenges in design and development, the current plans do not include fully demonstrating the maturity of the subsystem. Land based testing of the gun system, including the automated mount and magazine, is planned for the summer of 2005 and flight tests for the munition are set to complete in September of 2005. However, the two technologies will not be tested together until after ship installation. Program officials cited lack of adequate test facilities as the reason for the separate tests. In commenting on a draft of this report, DOD stated that it is appropriate to undertake a reasonable amount of risk in the DD(X) lead ship, given the long production lead time in shipbuilding. It noted that the DD(X) risk mitigation approach represents the management of finite resources to achieve innovation and to implement a cost effective test plan designed to address those risks. DOD stated that the DD(X) schedule supports readiness of all the engineering development models in time for ship installation, which for shipbuilding programs, is the most relevant point of reference for technology maturity as DOD policy indicates technologies for ships do not have to be mature until that time. DOD concluded that the DD(X) engineering development models are on track to support a milestone B decision in March 2005 to authorize the lead ship and to achieve maturity prior to installation. DOD pointed out that it had selected exit criteria for that decision to provide for assessments of critical technologies and that results of all required tests will be available for the decision. DOD made specific comments on individual engineering development models, which we address elsewhere in the report. As noted in the draft report, we believe the approach the Navy has taken to demonstrate DD(X) technologies through the engineering development models is both structured and disciplined. However, the short amount of time between lead ship authorization and ship launch (5 years and 3 months), together with the fact that virtually every major subsystem on the ship depends on a new technology or novel use of existing technologies, frame a challenge that involves significant risk. While tests on some key subsystems are scheduled to be conducted by the milestone B decision, these tests are to demonstrate the functionality of components but not the subsystems. Thus, the full demonstration of technology maturity and the resolution of unknowns will continue beyond the milestone decision. Our past work on best practices has shown that technological unknowns discovered later in product development lead to cost increases and schedule delays. Two key factors that can mitigate the effect of such risks--time in the schedule to address problems and the availability of backup technologies--are largely unavailable for the DD(X) program. While DOD policy allows for technologies to mature up to the point of ship installation, it does not necessarily follow that this is a best practice. In fact, DD(X) will proceed from the start of development to initial capability in about the same time as other non-shipbuilding systems for which DOD does call for demonstration of technology maturity before development start. We plan to provide copies of this report to the Senate Armed Services Committee; the Senate Committee on Appropriations, Subcommittee on Defense; and the House Committee on Appropriations, Subcommittee on Defense. We also will provide copies to the Director, Office of Management and Budget; the Secretary of Defense; and the Secretary of the Navy. We will make copies available to others upon request. If you or your staff have any questions concerning this report, please contact me on (202) 512-4841; or Karen Zuckerstein, Assistant Director, on (202) 512-6785. Major contributors to this report are J. Kristopher Keener, Angela D. Thomas, and Karen Sloan. DD(X) DD(X) DD(X) DD(X) DD(X) DD(X) DD(X) The following are GAO's comments on the Department of Defense's letter dated August 20, 2004. 1. Change to the ship schedule incorporated into the body of the report. 2. The period from February to July includes only testing of the permanent magnet motor, one component of the integrated power system. The date in the report was changed to July 2005 to reflect the beginning of full system testing of the integrated power system. 3. This is not a GAO conclusion. The statement is based on statements provided by the Navy as well as industry contractors. 4. Our discussion of the technology and design maturity of the dual band radar and the integrated deckhouse deals with the impact of the Navy's decision to change radar frequency, not the reason for the decision. The Government Accountability Office, the audit, evaluation and investigative arm of Congress, exists to support Congress in meeting its constitutional responsibilities and to help improve the performance and accountability of the federal government for the American people. 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Summary:
The DD(X) destroyer--a surface ship intended to expand the Navy's littoral warfare capabilities--depends on the development of a number of new technologies to meet its requirements. The Navy intends to authorize detailed design and construction of the first ship in March 2005. GAO's past work has shown that developing advanced systems that rely heavily on new technologies requires a disciplined, knowledge-based approach to ensure cost, schedule, and performance targets are met. Best practices show, for example, that a program should not be launched before critical technologies are sufficiently matured--that is, the technology has been demonstrated in its intended environment--and that a design should be stabilized by the critical design review. Given the complexity of the DD(X) system and the number of new technologies involved, GAO was asked to describe the Navy's acquisition strategy for DD(X) and how it relates to best practices, and how efforts to mature critical technologies are proceeding. To reduce program risk, the Navy plans to build and test 10 developmental subsystems, or engineering development models, that comprise DD(X)'s critical technologies. While using these models represents a structured and disciplined approach, the program's schedule does not provide for the engineering development models to generate sufficient knowledge before key decisions are made. None of the technologies in the 10 engineering development models was proven to be mature when system design began, as best practices advocates. Moreover, the Navy does not plan to demonstrate DD(X) technology maturity and design stability until after the decision to authorize construction of the lead ship, creating risk that cost, schedule, and performance objectives will not be met. With many of the tests to demonstrate technology maturity occurring around the time of critical design review in late fiscal year 2005, there is the risk that additional time and money will be needed to address issues discovered in testing. Some of the technologies are progressing according to the Navy's plans, while others have experienced challenges. Four of the 10 engineering development models--the total ship computing environment, the peripheral vertical launch system, the hull form, and the infrared mockups--are progressing as planned toward demonstrating complete subsystems. However, four other models--the integrated power system, the autonomic fire suppression system, the dual band radar, and the integrated deckhouse--have encountered some problems. At this point, the most serious appear to be the schedule delay in the dual band radar resulting from the Navy's decision to change one radar type and the additional weight of the integrated power system. The two remaining engineering development models--the integrated undersea warfare system and the advanced gun system--are progressing as planned, but will not culminate in the demonstration of complete subsystems before being installed on the first ship. While the Navy has fallback technologies for the hull form and the integrated power system, it does not have such plans for the other eight engineering development models.