MSMO Industry Day Brief 25 August 2008

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2. Goal: Discuss Navy Acquisition Strategy for Multi-Ship Multiple Option (MSMO) boat repair contracts and react to industry concerns. Layout path ahead for MSMO Spiral II and utilization of Industry Day to expand correspondences with Ship Repair industry.AgendaOverview of MSMO StrategyNavy ResponsivenessMSMO MetricsMSMO ReviewSpiral IIContract StatusUpcoming AwardsQ

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MSMO Industry Day Brief 25 August 2008

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Objective and Agenda Objective: Discuss Navy Acquisition Strategy for Multi-Ship Multiple Option (MSMO) send repair contracts and react to industry concerns. Diagram route ahead for MSMO Spiral II and utilization of Industry Day to expand interchanges with Ship Repair industry. Motivation Overview of MSMO Strategy Navy Responsiveness MSMO Metrics MSMO Review Spiral II Contract Status Upcoming Awards Q&A

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Why MSMO Navy working idea: Fleet Response Plan (FRP) Rotational and surgeable Improved Ao Ops sked vulnerability requires distinctive supporting upkeep idea Old maint plan of action does not bolster surge availability or Ao Navy required a nonstop, responsive, open, adaptable, reasonable, every minute of every day support conveyance handle. MSMO is that procedure MSMO conveys upkeep all the more dependably and ceaselessly and decreases the availability "bath" impact in a quickly changing and dynamic condition MILPERS Reduction Initiative being established in FY08 depends on MS/MO temporary workers as a key hotspot for that workload achievement

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MSMO Goals Consolidate prerequisites into a littler arrangement of supply chains Responsive to Small Business Administration (SBA) approach Responsive to Fleet operational needs (FRP) & SHIPMAIN Allow for successful and effective support hones Allow for long haul merchant & provider connections Advantageous costs, terms & conditions Product recognition Work drive adjustment & capital arranging " Ktr arrange/ktr execute " more proficient than " Navy arrange/ktr execute " Reduce Navy foundation/oversight

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MSMO Strategic arrangement going ahead… SHIPMAIN Industry input & criticism MSMO Concept "desires" Acqn Strat/industry day MSMO Contract "Winding 1" Industry rec'd upgrades: MCIT: plng & programming Contract Eff. BRT: execution JINII: AIT incorporation Performance Outcomes Strategic outcomes: Readiness versus cost MSMO Summits Good conduct: bank it Bad conduct: settle it Structural changes "Acquisition" Incremental enhancements "Cont. Administrator." MSMO Contract "Winding 2" … . 2003 2004 2005 2006-7 2008-9

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MSMO Contract "Winding 2" Industry rec'd upgrades: MCIT: plng & programming Contract Eff. BRT: execution JINII: AIT reconciliation Performance Outcomes Strategic outcomes: Readiness versus cost MSMO Summits Good conduct: bank it Bad conduct: settle it Structural upgrades "Acquirement" Incremental changes "Cont. Administrator." MSMO Contract "Winding 3" … advancing through cycles of learning … . 2009 2010 2011 2012 2013 2014 As MSMO structure balances out, center will move to strategic efficiencies: MCIT, Contractor BRT, AIT Integration

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MSMO Outcomes MSMO shows that it underpins Ao and surge preparation Nearly all MSMO CNO profits finish on time Incorporation of Growth/New Work has been smooth CMAVs have lessened material status "bath" impact Emergent reaction has been extremely fruitful: KEARSARGE, HALSEY, NORMANDY, SAIPAN… Technical execution Outstanding No known or recorded operational or mission corrupting disappointments because of MSMO workmanship or material Learning Curve execution Class commonality grants creation designing changes and support developments Shaft repairs, MV-22, All-electric redesign, Hab Mods, Scan Eagle, Rapid Cure Coating, Rudder seal substitution MSMO Cost: Nearly all availabilities perform under the first arranged cost More and all the more collaborating apparent CG Modernization East-West change handle with BAE NNSY-BAE work share on L-decks Contractor productivity Barrier Removal Team framed

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Navy Responsiveness No pre-decided Schedule for Awards Navy produced waterfall graph of notional honors in light of lapsing contracts Navy distributed notional calendar to industry by means of FedBizOps. Naval force held Summits with Industry where notional honors were talked about (JINII/Industry Days) Schedule for Awards affected by contract workload, including dissent work Multiple East Coast contract honors are challenged Offerors have the privilege to challenge. Per Aug 28, 2007 Virginia Pilot Article " Shipyards more prone to dissent losing multiship gets," an industry pioneer is cited as saying, "I take a gander at it as hazard and reward. Is it worth burning through $200,000 to get an agreement possibly worth $100 million to $200 million? These challenges are nothing individual. To me, it's great business."

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Navy Responsiveness Navy proceeds with execution on critical and convincing premise and is not considered responsible When convenient dissent recorded at GAO, there is a programmed remain of execution. While dissent is pending, COMNAVSEA may supersede programmed stay where (1) proceeded with execution is to the greatest advantage of the United States, or (2) dire and convincing conditions won't allow sitting tight for the GAO's choice [due inside 100 logbook days of the challenge's filing]. COMNAVSEA's abrogate choices: Demands of a mission-prepared armada in time of war. On the off chance that GAO maintains challenge, NAVSEA will proceed with contract execution by awardee when GAO's composed suggestion approves the office to do as such, pending fulfillment of the prescribed restorative activities. [For case: GAO finds that its "proposal can be actualized and important alleviation achieved" in spite of continuation of execution by the awardee.] The Navy is considered responsible in managed dissent choices since we execute the GAO's prescribed remedial activities in a sensible way and in consistence with the law.

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Navy Responsiveness NAVSEA Contracting practices and procedures imperfect Conducted Extensive Assessment of Contracting Processes Multi-disciplinary (Contracts, Internal Team led survey) Recommendations: Increase utilization of verifiable information in Notional Work Packages and Independent Government Estimates Expand audit of Cost Assessments and supporting documentation Improve documentation quality and consistency Membership of BVAC ought to incorporate senior Contracts and Legal specialists Cost Assessment Team ought to appoint hazard to cost proposition Minor authoritative changes

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Navy Responsiveness NAVSEA Contracting practices and procedures defective (cont) Improvements to Existing MSMO Process thus of Reviews Exploring utilization of Contractor support for advancement of the notional work bundle and Independent Government Estimate Revising BVAC Guidance to require CAP and TERP to confirm proposition consistency Conducted coordination gatherings to guarantee changes are legitimately executed

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Navy Responsiveness Navy looks for Capital Improvement Investment Navy initiative does not require capital venture as a feature of MSMO process; in any case, organizations can settle on business choices to put resources into capital tasks to upgrade their aggressive position. Naval force administration bolsters the conveyance of best an incentive to the legislature from industry accomplices, yet does not manage the technique for conveyance.

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MSMO Metrics Measurements No worldwide measurements that correspond drive wide material condition to MSMO execution exist SWE BOD entrusted SEA 21 and Fleet Maint Officer to propose and build up extra measurements. Creating process way to deal with gather information Industry investment required in accumulation of measurements information

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MSMO Review and Spiral 2.0

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Review Recommendations - Validated MSMO idea and technique Increase utilization of chronicled information in Notional Work Packages and Independent Government Estimates to enhance precision Improve IGE documentation Explore temporary worker support to supplement prepare Expand survey of Cost Assessment and basic/supporting procedures Improve documentation Pursue Discussion inquiries to sufficient determination Re-open Discussions, as essential, to guarantee expectation of proposition and consistence with RFP

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Review Recommendations II Increase concentrate on cost authenticity investigation (distinguished in GAO choices) through preparing, enlisting, or contracting for ability. Increment accentuation on accommodating proposition contrasts/irregularities in offerors' specialized, taken a toll, and joining recommendations through early correspondence between TERP Chair and CAP Chair Ensure exchange offs and informed decisions in the source choice process (and particularly in the cost authenticity investigation) are enough archived in the record.

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MSMO SPIRAL 2 (Bottom Line) Internal Review New NWP/IGE improvement and Cost assessment systems arranged Exploring utilization of temporary workers to bolster drafting of NWP and IGE Revised, more nitty gritty questions to unsuccessful offerors Very fruitful briefs for MCM upkeep - will use as format for future out briefs Updated Acquisition Plan Continue Cost Plus Award Fee (CPAF) contracts Awarded by Homeport for a class/gathering of boats

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MSMO SPIRAL 2 (Bottom Line) 40% Small Business Percentage Requirement per contract stays Over 40% impetus to be expelled Provisional AF Payment Included 50% of potential Award Fee Payment in view of exhibited execution more than two back to back Award Fee periods Contract term/choices encourage long haul acquirement handle. Five year Norm Government maintains whatever authority is needed to go to a seven year time of execution

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Contract Status NINETEEN CONTRACTS AWARDED; FOUR PROTESTS SUSTAINED Homeport/Class Awarded Contract Number Awardee Norfolk DDG Docking 20 December 2004 N00024-05-C-4404 NORSHIPCO (Now BAE-N) Norfolk DDG (Non Docking) 15 February 2005 N00024-05-C-4406 MHI Mayport DDG (Non Docking) 15 February 2005 N00024-05-C-4413 MHI Norfolk LHA/LHD 23 December 2004 N00024-05-C-4403 NORSHIPCO (Now BAE-N) San Diego CG 24 March 2005 N00024-05-C-4409 SWM (Now BAE-SD) Ingleside TX (MCM 1 Class) 18 July 2005 N00024-05-C-2304 ANTEON (Now GDIT) Puget Sound (FFG/DDG) 19 September 2005 N00024-00-C-8514 Todd Pacific Shipyard San Diego LPD/