Congressional Bloviation On The 'Concurrency Bogeyman'

There's no 'There' there...
I was initially going to post on this when it was first announced, then I decided to just let this latest F-35 development lie where I thought it belonged (in the ‘Political Doublespeak ‘roundfile’) because the major blogs and news outlets weren’t giving it much play. I moved on to other interests, but should have anticipated that the more inflammatory of the pundit perches were merely saving up for a weekend rabble-rouser squawking. Defense Tech, in an unattributed piece started the red-meat varmint call early last Friday. The post itself was on the whole quite innocuous -if incomplete - but it was the rhetorical “we’ll see what happens next” at the end that calls out to the innumerate and the ignorant along with the casual observers to proffer uninformed opinions en masse. This would be, of course, perfectly acceptable as long as they are offered AS opinions. The problem with much of the DT/Military.Com crowd these days is that too often opinions and personal preferences offered are masquerading as absolute statements of fact without any specific evidence of same. Heck, we’re lucky if they even bother with a fallacious argument, and when they do, if one points out the argument is fallacious it will result in fallacious ad hominem thrown back reflexively. ( I'll check out the responses to my comment at DT after I get this up, but as I have noted before, JSF 'haters' are woefully short of logicians (link).

The WHOLE story and nothing but....
To quote the actual (and corrected) statement (link here)

"We recommend a $695 million reduction to the Joint Strike Fighter program. We continue to strongly support this program and believe that the F-35 is showing progress since it was restructured last year. However, excessive concurrency in development and production still exists. The test program is only 10 percent complete, yet the request continues to ramp up production of aircraft in fiscal years 2012 and 2013. We recommend maintaining production at the fiscal year 2011 levels for two more years in order to limit out year cost growth. For each aircraft we build this early in the test program, we will have to pay many millions in the future to fix the problems that are identified in testing.

Instead of employing a teaser ‘let’s see what happens next’ approach, how about we ask ourselves ‘What might this (Senate decision and rationale offered) really mean?”

I. Decomposing the Appropriations Committees’ Recommendations
Note: Readers may skip this section and proceed directly to Part II if they desire, and revisit this section if they have questions as to my summary of the Committee’s core argument. In fact, unless you are predisposed for classical rhetoric, I STRONGLY recommend it.

We can accept the statement at face value or assume there is deviousness and deception involved. Being a ‘Theory Y’  kind of guy, I would normally tend to look at a statement and first take it that Senator Inoue and the Committee really mean what is stated.  But are their assumptions and reasons given correct? Can we assess their logic and find it sound?

The Explicit…

First, let’s summarize what it is explicitly stated:

1. The Appropriations Committee recommends a $650M reduction to the JSF program budget.
2. The Appropriations Committee asserts that the F-35 program concurrency is “excessive”.
3. The Appropriations Committee continues “to strongly support” the Joint Strike Fighter program.
4. The Appropriations Committee believes the program has shown “strong progress” since last year.
5. The Appropriations Committee recommends maintaining the current production level at 35 aircraft per year for two more years (2012 & 2013) for the express purpose of “limiting out year cost growth”.
6. The Appropriations Committee asserts that each aircraft built “this early” in testing will require “many millions in the future to fix the problems that are identified in testing”

…and The Tacit

The above is rather straightforward, and normally not worth reiterating. I only took the trouble of identifying these explicit statements to help differentiate between what is expressed -- and what is ‘presumed’ or ‘implied’.  What presumptions and implications should we feel confident in deducing from the explicit statements? I assert that until contrary information is available, the following may also be seen as contained within the Committee’s statement.

 I assert that we can safely deduce, given the totality of the Committee’s statement, that:

A. All or the significant portion of the budget reduction is coming out of the proposed production budgets for 2012 and 2013. We should note here that the 2013 reduction could be reversed (or increased) next year, but that probably would not have a significant effect on the actual production because the dollars taken out now for 2013 will affect long-lead procurement items and you cannot accelerate their acquisition by simply turning on the ‘money tap’ again.   
B. The Committee believes that this delay in ramping up production will reduce “excessive” program concurrency.
C. The Committee believes that reducing program concurrency will save the program “millions of dollars”. 

We can further deduce from the above that IF the Committee believes it makes economic sense to delay production, they must believe the savings from not having to retrofit the aircraft somehow exceeds the cost of maintaining the inefficient utilization of manufacturing resources for two years, and increased costs of production in the out years.  This must include the adverse impacts on hundreds if not thousands of suppliers, large and small.  Of course, if some of those suppliers are having difficulty meeting engineering and/or production schedules (typically a small minority in any program) they will benefit from such a delay (and there are simpler and more certain remedies for such problems other than slipping the entire program).

II.  The Senate Appropriations Committee’s Central Argument

Thus we see from all of the above that the Senate Appropriations Committee’s expressed rationale for cutting the F-35 budget rests solely on the following argument:

“High-concurrency programs involve having to ‘fix’ early production articles and the costs incurred in these programs can be minimized (i.e. monetary savings will be realized) by stretching out the production to make the program less concurrent.”

To evaluate this claim, I em>WAS going to proceed with a scholarly investigation of literature dissecting the pros and cons of program concurrency, its relationship to cost overruns and schedule delays. I assumed getting to the bottom of the story would be complicated.
It is not.
It is simple.
In spite of well over two decades of fear-mongering by detractors, 'Concurrency' in and of itself has been shown to be nothing to fear - only managed.

All you need to know to judge whether or not the Senate Appropriations Committee action made sense is found in the following few documents. You can look at others, but you wont find much difference among the earlier work and the last reference is the latest and most complete research on the topic.

Concurrent Weapons Development and Production, CBO, August 1988 (link)

In this study, the CBO went looking for the adverse effects of ‘concurrency’ and came away ….somewhat contrite (emphases mine):

This study examined concurrency, cost growth, and schedule data for 14 major weapons systems that were developed during the 1970s and have been subsequently produced and deployed. The systems include a variety of types of weapons from each of the military services, and all of them have been reviewed by the Defense Systems Acquisition Review Council (DSARC). The analysis showed that no strong relationship exists between concurrency and schedule delay (see Summary Table). A statistical regression analysis found that only a couple of percentage points of the variation in schedule delays are explained by concurrency. A modestly stronger relationship exists between concurrency and cost growth: approximately 14 percent of the variance in cost growth is explained by concurrency. (Page vii-iix)

The report noted all the changes that have occurred in years leading up to the report that reduce concurrency and its ‘effects’ –tenuous linkages or no – but that didn’t stop the authors from suggesting MORE limitations for Congress if they so desire:

Given the ambivalent statistical evidence concerning the effects of concurrency on costs and schedules, and the fact that current laws and regulations limit its use, the Congress may wish to take no further action regarding concurrent programs as a group. On the other hand, in view of recent problems with certain programs, the Congress may wish to have more information on high-priority programs that are employing concurrency (Page xi).

BTW: No data or detailed discussion of methodology was included in the report so it would be hard to really get your teeth in the study to judge its completeness and efficacy.
Then we get to Congressional testimony in May 1999 by Frank C. Conahan, Assistant Comptroller General, National Security and International Affairs Division of the GAO (link here):
Within, Mr, Conahan insists problems with 5 of 6 then-‘highly concurrent’ programs were related to concurrency (without any supporting rationale as to why concurrency is a problem) and took a swipe at the then-emerging DDG-51 program. His ardor was as palpable as his data was invisible. It drips with the fear that somebody must be doing something wrong someplace therefore the standard GAO response of 'more oversight' gets an entire section.

But there simply MUST be something to this concurrency thing, right?  Well people kept looking. A team of analysts from CNA reported in the Defense ATL magazine (link) late last year:  

Our results (located at [link fixed by me], based on examining 28 programs across all Services, are very similar to those of the Congressional Budget Office and RAND [example] studies with one surprising exception: While from a purely statistical point of view we found that the relationship between both planned and actual concurrency and cost growth was very weak, in both cases, there seems to be a “sweet spot” of about 30 percent concurrency. That is, programs that plan on spending 30 percent of RDT&E funds while concurrently spending procurement funds actually experience the lowest average cost growth. Similarly, those programs that actually do spend about 30 percent of RDT&E funds while concurrently spending procurement dollars, even when not originally planned, also experience lower cost growth. Furthermore, programs with planned or actual levels of concurrency below 30 percent experienced higher cost growth than those with higher levels of concurrency. In other words, lower levels of planned or actual concurrency were actually worse than higher levels of concurrency. This is the complete opposite of what many in the acquisition community believe. We speculate that lower levels of concurrency may expose the program to higher levels of external changes.  

At the end of the AT&L article, the authors Donald Birchler, Gary Christle, and Eric Groo close with the following:

What to Do About Concurrency?
So far, no conclusive evidence exists that concurrency (no matter how it is defined) is generally a problem. This does not mean that concurrency is never a problem. But most likely, concurrency leads to cost and schedule growth under very particular circumstances. What these circumstances are is not very clear just yet. Nor is it clear why in our study, the sweet spot for concurrency is somewhere around the 30 percent mark. What is clear is that there are definite advantages to concurrently designing and building a weapons system that most program managers take advantage of, to some extent or another.
The [1988] Congressional Budget Office study advised that “Congress may wish to take no further action regarding concurrent programs as a group,” given the very weak relationship between the concurrency and cost growth. Instead, the office argued that Congress should simply ask that DoD develop a consistent measure for concurrency to be published in a program’s acquisition report and then monitor programs to see how they are performing relative to their planned level of concurrency. More than 20 years later, this advice still seems to be appropriate.

Alas, I fear the CNA team’s sensible findings and advice will go unheeded – as long as the “Concurrency’ Bogeyman serves as a useful tool in the quiver of bloviating politicians.

Senators! – this time I’m talking to you!