Is This the End of the $400 Hammer? : Defense Department purchasing improvements can be expected; miracles, alas, cannot
Probably no subject involving the military has provoked greater bafflement, derision, amusement or outrage than the purchasing polices so long followed by the Pentagon. The specifications drafted by the Defense Department’s experts as a preliminary to ordering even the most commonplace products--cookies, T-shirts, screwdrivers, light bulbs--are often museum-quality examples of wretched bureaucratic excess.
The military buys scores of billions of dollars worth of goods every year. Few doubt that a large fraction of that money is wasted because of the costs added to products by unnecessarily detailed technical specifications. In one of the more welcome reforms of recent times Defense Secretary William J. Perry promises that much of this will now change. Indeed, he says, “we’re turning the present system upside down.”
How? Primarily by directing purchasing agents to begin using commercial standards in buying goods, in place of devising and imposing sometimes unique military requirements. In other words there will soon be a lot more buying off the shelf.
Additionally, the Pentagon will now tell manufacturers what it wants in the way of performance, instead of providing precise instructions on how to make a product. A lot of commercially available products now easily meet military performance standards. For many, there will no longer be any need for special factories or assembly lines to satisfy military specifications.
Significant cost savings are expected by the third year of the new program. By the 1998 fiscal year, to take an example, Perry expects a $700-million savings on the purchase of electronic subsystems for just one type of Army helicopter. Perry won’t estimate the total potential cost reduction, but some analysts say up to $12 billion a year is possible.
The procurement policy shift is recognition not only that the traditional way of buying things can result in waste but also that there have been major improvements in the quality of the many commercially made products the Pentagon will buy.
At least from World War II on, durability and reliability have properly been top considerations for the military, while the overhead costs of meeting military standards have been relegated to secondary consideration. In the age of tighter budgets, what was of secondary significance now inevitably and properly looms much larger.
Will the new policy mean the end of such fiascos as the $800 coffeepot and the $400 hammer? Rational purchasing improvements can be expected; miracles, alas, cannot. But if nothing else, trying to justify such outrages is about to be made infinitely harder. This is not a battle where total victory is possible. But at least a lot of ground can be gained.