Changing DOD’s Quality Assurance Practices Is Challenging Given Long-standing Problems

DOD faces a formidable challenge in changing its quality assurance culture. This estimate does not include what DOD has spent to correct the manufacturing and quality problems that have contributed to historical cost and schedule overruns on weapon system production programs. A major difference between DOD and commercial manufacturers is that DOD has, until recently, maintained its practice of inspecting rather than designing quality into a product while world-class companies have broadened their definition of quality to include design. An Industry Review Panel on Specifications and Standards found that the C-17 production process had many quality problems that were adding cost to the program. Quality assurance changed from being a postmanufacturing step, done at the end of each process, to being part of the process itself. They began by reducing their number of suppliers. DOD Moves to Improve Quality Assurance Practices

Beginning in the early 1990s, DCMC implemented Process Oriented Contract Administration Services (PROCAS) as a method of moving away from inspection-oriented quality assurance practices and toward process control. According to the plan created by the Government and Industry Quality Liaison Panel in April 1995, DOD would allow a contractor to use the same quality management system—based on process controls—for its military contracts that it uses on its commercial contracts. Therefore, we recommend that the Secretary of Defense (1) establish measurable steps to implement and monitor the progress of the Government and Industry Quality Liaison Panel plan closely; (2) periodically assess its success in implementing basic standards such as ISO-9000; (3) develop ways to encourage the adoption of advanced quality concepts of design for manufacturing, process controls, and supplier quality programs throughout the defense industry, using commercial practices as a guide; and (4) as suggested in the plan, establish incentives for defense contractors to participate, such as providing credit during source selection for successful implementation of these advanced quality practices. 7.
Why GAO Did This Study

GAO reviewed the Department of Defense's (DOD) quality assurance practices, focusing on: (1) the problems that DOD has had in improving such practices; (2) private-sector practices that could be beneficial to DOD; and (3) DOD efforts to improve its quality assurance activities.

What GAO Found

GAO found that: (1) DOD spends more than $1.5 billion annually to support its quality assurance activities; (2) manufacturing and quality problems have contributed to cost and schedule overruns on DOD weapons systems programs; (3) DOD acquisition programs have experienced quality problems during the production phase due to incomplete weapon designs; (4) DOD is relying on unstable designs and inspections to rework the defects in its B-2 bomber and C-17 Airlifter programs; (5) a number of successful commercial manufacturers are improving the quality of their products, while reducing their oversight and inspection costs; (6) commercial manufacturers have broadened their definition of quality assurance, by changing it from a postmanufacturing step done at the end of each process to being part of the process itself; (7) DOD began in the early 1990s to implement a method of moving away from inspection-oriented quality assurance practices and toward process control; (8) DOD is developing a plan to reduce the costs of redundant quality assurance processes; (9) the plan will allow DOD contractors to use a single quality management system based on process controls for all DOD contracts; and (10) DOD could enhance its quality management system by encouraging defense contractors to use more advanced commercial techniques and quality assurance practices.