Followup on Use of Numerically Controlled Equipment To Improve Defense Plant Productivity

The Department of Defense (DOD) owns $336 million worth of numerically controlled equipment, such as drills, lathes, and machining centers. This equipment, controlled automatically by computers or punched tape, is particularly expensive and complex. Although conventional equipment is more appropriate for many applications, numerically controlled equipment offers increases in productivity and savings, particularly for a small lot production. Also, depending on its management and application, numerically controlled equipment can improve Defense plant surge capability for emergencies. On the other hand, unless management closely monitors this capability, it may not function as intended during a mobilization buildup. Two prior GAO audits analyzed Defense-owned numerically controlled equipment. This followup report was made to assess what DOD had done to improve its use and management of numerically controlled equipment. GAO briefly examined selected subjects covered in its earlier reports at several activities. Standardization continues to be a problem and is approached differently by different commands and activities. Work interchange between activities has not occurred except for a few work orders. Air Force activities employ formal work-mix study techniques to identify equipment needs, whereas others buy equipment because of production bottlenecks or deteriorated machines, sometimes without critically evaluating numerically controlled machines. Management information systems are extremely diverse in terms of usage categories recorded, and some systems are inaccurate and inadequate. Systems for workloading parts onto conventional or numerically controlled machines need improvements. Most shops have given priority to numerically controlled machine repair part acquisition. However, procedures could still be more streamlined.

The Department of Defense (DOD) owns $336 million worth of numerically controlled equipment, such as drills, lathes, and machining centers. This equipment, controlled automatically by computers or punched tape, is particularly expensive and complex. Although conventional equipment is more appropriate for many applications, numerically controlled equipment offers increases in productivity and savings, particularly for a small lot production. Also, depending on its management and application, numerically controlled equipment can improve Defense plant surge capability for emergencies. On the other hand, unless management closely monitors this capability, it may not function as intended during a mobilization buildup. Two prior GAO audits analyzed Defense-owned numerically controlled equipment. This followup report was made to assess what DOD had done to improve its use and management of numerically controlled equipment. GAO briefly examined selected subjects covered in its earlier reports at several activities. Standardization continues to be a problem and is approached differently by different commands and activities. Work interchange between activities has not occurred except for a few work orders. Air Force activities employ formal work-mix study techniques to identify equipment needs, whereas others buy equipment because of production bottlenecks or deteriorated machines, sometimes without critically evaluating numerically controlled machines. Management information systems are extremely diverse in terms of usage categories recorded, and some systems are inaccurate and inadequate. Systems for workloading parts onto conventional or numerically controlled machines need improvements. Most shops have given priority to numerically controlled machine repair part acquisition. However, procedures could still be more streamlined.

The Department of Defense (DOD) components maintain a large, complex industrial base to meet contingency and war mission needs and provide expansion to meet prolonged wartime mobilization requirements. In peacetime the base is used to maintain, repair, and overhaul weapon systems and produce munitions and other war materials. Costs for fulfilling these requirements are enormous and are rising. Numerically controlled (NC) equipment, as discussed in this and prior reports, offer benefits--if managed properly--in terms of meeting mobilization requirements and achieving efficiencies and economies. This report describes the status of DOD's NC activities and illustrates that a good deal more must be done for DOD to realize the full benefits of NC equipment in its (1) Government-owned, Government-operated facilities and (2) Government-owned, contractor-operated facilities and to indirectly realize benefits from the contractor-owned, contractor-operated plants.