The following conditions described in table 2 is present.
Table 2: Examples of Industrial Base Risks That Could Impede DOD’s Ability to Obtain Products at the Time, Quantity, and
Page 7 GAO-18-435 Defense Industrial Base
Quality
1)Needed
Risk Description
Financial Health of Suppliers Financial instability caused, in part, by a decline in DOD or commercial sales
could lead to a company going out of business or abandoning its defense
portfolio.
2)Specialized Equipment or Skills Loss of access to equipment or highly specialized scientific or engineering
skills—potentially increasing costs or extending time needed to begin or restart
production.
3)Production Capacity of Facility Production rate at a facility may not be sufficient to produce at the quantity and
time when needed to support DOD demand, thus, resulting in long wait times.
4)Foreign Dependence Dependence on foreign sources of supply can be less desirable and disrupt
supply due to export control restrictions, political instability, or other conditions.
5)Obsolete Items Materials, parts or technologies can become obsolete if replaced by newer
models or variants or the supplier has stopped production, resulting in
manufacturing or maintenance delays.
6)Emergencies or Disasters Natural or man-made disasters can disrupt operations at production facilities,
thus delaying deliveries.
7)Single Source Only one source may be available for reasons such as (1) no other alternative
exists with the skills or equipment necessary to produce the raw material or
component or (2) only one company has been qualified and it can be
expensive and time consuming to qualify additional sources.
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