Identifying and Mitigating Industrial Base Risk for the DoD: Results of a Pilot Study

Abstract

The DoD requires insight into the stress that reduced acquisition spending is placing on the industrial base. Implementing a reliable and validated methodology would facilitate DoD-wide mitigation actions designed to preserve or enhance key industrial base capabilities. The Office of the Deputy Assistant Secretary of Defense for Manufacturing and Industrial Base Policy has developed and tested a methodology for measuring the criticality of key capabilities (products, components, technologies) and their fragility within the industrial base (vendors and markets). The methodology is designed to be used across services and programs. Pilot testing conducted in 2013 of selected DoD programs and sectors applied this methodology to measure nine constructs of criticality and six constructs of fragility. The pilots assessed sectors and programs in diverse life-cycle phases, for example, development, production, and sustainment. Data collected from surveys, datasets, reports, and industry subject matter experts were used to assess the measures for capability/supplier pairs. Assessments were plotted in a fragility and criticality matrix to inform mitigation strategies. Empirical and statistical analyses indicate the methodology yields useful objective measures of risks in the industrial base. Results of the pilot tests were used for mitigation action and improved the methodology for future assessments.