Defense Acquisition:

Advanced SEAL Delivery System Program Needs Increased Oversight

GAO-03-442: Published: Mar 31, 2003. Publicly Released: Mar 31, 2003.

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The Advanced SEAL Delivery System (ASDS) is a mini-submarine that is one of the U.S. Special Operations Command's largest investments. The program is approaching the end of a difficult development and must undergo key testing before decisions are made to proceed beyond the first boat. Over the past several years, the Congress has raised concerns about technical difficulties, schedule delays, cost growth, and management oversight. The Senate Armed Services Committee requested that GAO review the status and problems facing the program. Specifically, this report examines the ASDS program's (1) progress towards meeting requirements and technical challenges, (2) ability to meet schedule and cost projections, and (3) underlying factors contributing to program problems.

While progress has been made in addressing technical difficulties with the first boat, some problems must yet be solved and other capabilities demonstrated before the ASDS can meet all of its key performance requirements. For example, the Navy has not yet been able to develop an adequate propulsion battery. In addition, the ASDS' final design will remain uncertain until technical problems are solved and testing is completed. The degree of uncertainty will be important as the U.S. Special Operations Command could decide that the ASDS is ready to conduct missions and commit to buying more boats after the operational evaluation scheduled for April 2003. The ability of the ASDS to meet cost and schedule projections is problematic. The program has experienced major schedule delays and cost increases. The program is 6 years behind its original schedule, and, by GAO's estimates, costs have more than tripled. Cost and schedule estimates were being formally revised at the time of this report, but even their accuracy will be uncertain because of unresolved, known problems; the potential for discovering new problems in upcoming testing; and the difficulty of estimating costs for future boats based on the first boat's aging data. Several underlying factors have contributed to the ASDS' difficult development. In retrospect, the capabilities required of the boat outstripped the developer's resources in terms of technical knowledge, time, and money. Key problems, such as the battery and the propeller, were discovered late--in testing on the first boat--rather than in component or subsystem level testing. Finally, the program suffered from insufficient management attention on the part of both the government and the contractor, which led to missed opportunities for righting the program as it proceeded. Moreover, the management attention that was exercised has been hampered by outdated information.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DOD agreed with GAO's recommendation, and the Test and Evaluation Master Plan for the ASDS operational evaluation was approved by the Director, DOT&E on April 24, 2003. An Operational Test Readiness Review was held in April 2003 and the Program Executive Officer (Submarines) certified ASDS to begin operational evaluation (OPEVAL).

    Recommendation: Before the operational evaluation is held, the Secretary of Defense should ensure that the overall ASDS test and evaluation master plan and the specific test plan for the operational evaluation are both sufficient in scope and approved.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: DOD agreed with GAO's recommendation, and the ASDS vehicle completed OPEVAL on May 8, 2003.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that the ASDS operational evaluation is completed as planned.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: DOD agreed with this recommendation. In April 2006, citing problems with ASDS-1 reliability, DOD announced that there will be no procurement of ASDS-2 and ASDS-3 and it cancelled the ASDS acquisition program.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that solutions to key technical and performance problems are demonstrated.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: DOD agreed with this recommendation. In April 2006, DOD determined that improvement was needed in ASDS-1 reliability and cancelled procurement of additional boats.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure the most likely performance of the ASDS is reassessed on the basis of the operational evaluation and demonstrated solutions to problems.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: DOD agreed that the ASDS program constitutes a Major Defense Acquisition Program, and USD/ATL designated ASDS as an Acquisition Category IC program on April 8, 2003.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that the ASDS program is designated a major defense acquisition program (aquisition category I).

    Agency Affected: Department of Defense

  6. Status: Closed - Implemented

    Comments: DOD agreed with GAO's recommendation and re-instated a milestone C production decision in March 2003. In April 2006, DOD cancelled the acquisition program and announced there will be no procurement of additional boats.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that a formal milestone C decision, in accordance with DOD acquisition guidance, is held.

    Agency Affected: Department of Defense

  7. Status: Closed - Implemented

    Comments: Although in 2003 DOD only partially agreed with our recommendation, in 2004 it agreed with us and designated the Advanced SEAL Delivery System as an Acquisition Category (ACAT) 1D program on November 1, 2004. This was done to ensure that the OSD Cost Analysis Improvement Group (CAIG) would conduct an independent cost estimate (ICE) in support of a Milestone C production decision. In April 2006 DOD cancelled procurement of additional boats; therefore the ICE is no longer needed. DOD now agrees with this recommendation. The Office of the Secretary of Defense, Acquisition, Technology, and Logistics (OSD AT&L) designated the Advanced SEAL Delivery System as an Acquisition Category (ACAT) 1D program on November 1, 2004. This was done to ensure that the OSD Cost Analysis Improvement Group (CAIG) would conduct an independent cost estimate (ICE) in support of the Milestone C production decision, currently scheduled for December 2005. The results of the ICE will ensure a high confidence level in the funding estimates and program affordability.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that the Cost Analysis Improvement Group develops an independent cost estimate for milestone C, based on the acquisition plan and planned product improvements.

    Agency Affected: Department of Defense

  8. Status: Closed - Implemented

    Comments: DOD agreed with this recommendation and elevated the program to an ACAT 1D to ensure that an independent cost estimate (ICE) was completed before making a decision to purchase additional boats. In April 2006, DOD cancelled the ASDS program.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that the program is funded to the level of the independent cost estimate.

    Agency Affected: Department of Defense

  9. Status: Closed - Implemented

    Comments: DOD agreed to reassess the worthiness of proceeding with additional ASDS purchases. In April 2006 DOD announced that there will be no procurement of additional boats based on its evaluation that improvement was needed in the reliability of ASDS-1.

    Recommendation: Before a decision to purchase additional boats is made, the Secretary of Defense should ensure that the worthiness of proceeding with additional purchases is assessed against both (1) the ability of the ASDS to perform missions and be sustained and (2) the opportunity costs of investing in the ASDS versus other special operations needs.

    Agency Affected: Department of Defense

  10. Status: Closed - Implemented

    Comments: DOD agreed with this recommendation. In April 2006 DOD announced that there will be no procurement of additional boats based on its evaluation that improvement was needed in the reliability of ASDS-1.

    Recommendation: If a decision to proceed with the purchase of additional boats is warranted, the Secretary of Defense should ensure that a follow-on test and evaluation of the second boat is planned and funded to demonstrate that remaining deficiencies have been corrected.

    Agency Affected: Department of Defense

 

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