Annual Industrial Capabilities Report to Congress
OFFICE OF THE UNDER SECRETARY OF DEFENSE WASHINGTON DC ACQUISITION TECHNOLOGY AND LOGISTICS
Pagination or Media Count:
The Department desires that the industrial base on which it draws be reliable, cost-effective, and sufficient to meet strategic objectives. However, an infinitely robust industrial base is not the ultimate objective of the Department of Defense. Rather, reliable, cost-effective, and sufficient industrial capabilities are a means to the Departments ultimate objective the development, production, and support of defense materiel necessary to provide for the nations defense. A reliable industrial base is one in which suppliers deliver contracted products and services on time. Additionally, reliable firms are viable for the long-term. These firms have a stable or expanding business base, earn fair operating margins for owners, and invest in internal research and development, capital equipment, and their workforce such that long-term viability, innovation, and competitiveness is likely. Reliable firms domestic or foreign deliver products with integrity that satisfy Department expectations in every respect for example, free of device tampering and counterfeiting. Finally, a reliable industrial base is one that facilitates innovation by both larger and smaller subsystem providers allows smaller, subsystem firms to compete meaningfully against larger, vertically-integrated firms and encourages new firms, commercial competitors, and reliable global suppliers to enter the defense marketplace and compete for defenserelated business. A cost-effective industrial base is one in which suppliers deliver contracted products and services at or below cost targets. A cost-effective industrial base is a competitive industrial base with at least two viable innovative suppliers with strong design teams in mature market areas and a greater number in market areas where demand is high and innovation is critical to meet future warfighting, stability operations, andor humanitarian assistance needs.
- Economics and Cost Analysis
- Military Forces and Organizations