Abstract:
During the period 1978 to 1984, cost overruns in defense system development and procurement were commonplace. In the same period, however, program costs for the Multiple Launch Rocket System (MLRS), a track-mounted field artillery rocket launcher, actually went down. In 1978, two years before the prototypes for the system were tested, the total program cost was estimated to be $2,232.3 million. In 1984, with full-rate production underway for over a year, the total program cost in 1978 dollars was estimated to be $2,077.8 million. MLRS is widely perceived to have been a procurement success story. The case deals first with the drafting and execution of an extremely detailed yet flexible acquisition plan. This work moving MLRS from concept to design, from mock-up to prototype, and from the production line to the front line took place at the level where the program office interacted with the Vought Corporation, the prime contractor. The case then addresses several aspects of this process, including the strategy behind the acquisition plan, and the use of contract design to exert leverage on Vought. The case also deals with the building and maintenance of a consensus both within the Department of the Army, and among the army, the Department of Defense, and Congress which would provide support for, and limit interference with, the acquisition plan.
Learning Objective:
The case deals first with the drafting and execution of an extremely detailed yet flexible acquisition plan. The case then addresses several aspects of this process, including the strategy behind the acquisition plan, and the use of contract design to exert leverage on Vought. The case also deals with the building and maintenance of a consensus -- both within the Department of the Army, and among the army, the Department of Defense, and Congress -- which would provide support for, and limit interference with, the acquisition plan.
