Organic Industrial Base –
The organic industrial base is a critical part of our national security apparatus. Its mission is to maintain, repair, and overhaul the military equipment of our Armed Forces, and employs over 80,000 civilian employees across 17 government-owned, government-operated industrial facilities. The organic industrial base (OIB) must be postured to support peacetime requirements but also agile enough to respond to a mobilization, national defense contingency, and other emergency requirements. These requirements are the essence of readiness.
As the Department of Defense implements the National Defense Strategy and acquires new aircraft, ships, vehicles, and weapons systems, it cannot ignore the operations and support portion of the acquisition cycle and must plan strategically for the future. If the OIB cannot quickly repair weapons systems as they require maintenance, then we are doing a disservice to our Armed Forces and our nation. It is a national priority to sustain, resource, and ultimately expand the OIB’s capabilities and capacity.
This report provides an overview of the OIB’s role as the business enterprise of the Department of Defense (DoD), the OIB’s ability to surge operations for future contingencies, and opportunities to expand capacity through technology, innovation, and strategic partnerships. The report is framed by an achievable concept using adopted business best practices to enhance OIB effectiveness and efficiency but is limited in assessing the OIB’s ability to surge due to fundamental differences between DoD’s measurement of capacity and industry standard output metrics.
This report builds off previous Eisenhower School reports offering fundamental direction of OIB strategy and execution covering business operations, infrastructure, finance, and human capital. A framework defining surge levels and capital investments required to achieve them is also provided. Aspirational recommendations include:
- Direct the Services to develop and follow business plans supported by long-term strategies focusing on: Value Creation, Value Propositions, Value Delivery, Value Capture and Value Communication.
- Direct the Services to adopt business case analysis methods to capture capital investment for new facilities and equipment as part of Net Present Value calculations.
- Follow a production-based model to drive OIB programming toward industry best practices rather than focus on direct labor hours as the principal production metric.
- Conduct a rigorous analysis at each government-owned maintenance, repair, and overhaul facility to determine both actual output and maximum output (measured in repaired military equipment and not direct labor hours) of each OIB production line.
- Direct the Services to describe how investment strategies for sustained technology insertion are part of infrastructure optimization plans.
Read the report →