Good afternoon. It's a real privilege to join you for lunch and have a chance to address this distinguished crowd. ...
I have spent quite a bit of time since I became the chief of staff traveling around talking to people in and outside our United States Air Force. The message I'm giving them is that we have a world-class Air Force. One of the reasons that I say this is that everywhere I go, every country I visit, the air chief of that country wants to have an Air Force like ours. And I try to remind people that while our industry gives us wonderful technology, in the end it is really the people who make our Air Force what it is today -- their innovation, their association with one another and with associations such as this.
Part of my pitch is to talk about a major theme that I have -- it has to do with this idea of building an Air Force team within a larger joint team. When I talk about a team within a team I'm trying to foster a strong sense of who it is that makes up the Air Force and what it is we bring to this larger team.
Today I'll talk about some of the details, some of the membership on this first team -- the Air Force team. I will tell you, from my experience over the past 31 years, that the Air Force is made up of a mosaic of people with a variety of skills, functions and capabilities. Some of them wear badges indicating that they are missilers, some wear medical badges, some wear security badges, some wear no badges at all, and some wear aviation badges. But the fact of the matter is that this is an Air Force of active duty, Guard, Reserve and civilians that has a reservoir of expertise that we rely upon daily. No one group is any more or less important than another.
And when I'm smart enough to remember, I include our retirees. I must tell you that they are the people who have laid the foundation for the Air Force today, just as those serving today are providing for the foundation of tomorrow. Their vision, their sacrifice and their leadership built the world's premier air and space force.
But this broad definition of the Air Force didn't really start with me. I recall that [Air Force Gen. Henry H.] "Hap"Arnold once said, "Air power is not made up of airplanes alone. Air power is a composite of aircrews, maintainers, suppliers and industry."
I like that description. It reminds me of what I've personally learned in the past -- that given freedom to go do what they must, our aerospace industry has the insights and skills needed to get the job done.
I had the opportunity to serve during the past two years as the CinC (commander in chief) of the U.S. Transportation Command, responsible for our defense transportation system. In that job I was struck by what a great percentage of our defense transportation comes from the civilian industry. I was forced to deal with the civilian airlines, shipping and the surface transportation industry, and I learned that this industry was far, far ahead of the defense establishment in terms of innovation, use of technology and its ability to track things moving through its system. So that was the beginning of an awareness on my part that we might do well to build on Hap Arnold's theme -- to include our partners in industry as full partners on the Air Force, total force team.
You're going to hear more about this on my watch. Today is the inaugural unveiling of this idea -- a new total force concept. Given our current climate, I think it's absolutely critical that we adopt this attitude.
Today the Air Force is in a unique position. We are having to come to grips with how to survive in peacetime. If you think about it, the other military services have a couple of centuries of dealing with this. The Air Force was born out of the crucible of the Second World War and enjoyed a unique position throughout the Cold War. Now with the end of the Cold War and the demobilization that we have been undergoing for the past five or six years, I think all of us must look at how we relate to one another.
Throughout my career the defense budget has always been relatively high. It averaged between 7 to 9 percent of our GNP [gross national product]. Then in the '80s it dropped to about 6 percent. Today our defense budget is down to about 4 percent of the GNP.
Some people look at this and they see it as a very startling and troubling development. I can tell you that I was working in the Air Force programing business in the late 1980s. I remember what a catastrophe we thought it was when we went from 3 percent real growth to 2 percent and how painful it was for us to deal with that. Now that suddenly looks like the good ol' days.
But if you look back over the past two centuries, you see the true flow of history. You see the defense spending in the Cold War as the aberration. For example, from the Civil War to World War I defense spending averaged 1 to 2 percent of the GNP. And between the world wars the defense budget fell to below 2 percent level. So if you take a longer view, you see that what we're spending on our defense today is above where it's been in similar times.
Now I realize that there are a number of differences between the 1890s and the 1990s. Today our oceans offer less protection. We are engaged in a global economy, and the world is much smaller because of the speed at which events are felt around the world. We have the technology information explosion and have become an aerospace nation. So given these factors, I don't think our budget will drop to 1 or 2 percent again. I don't know where it will end up. I don't have a crystal ball that is any better than what you have.
But my point is, we are in a period of relative peace with no immediate threat to the survival of our nation. So I think we've got to break out of Cold War habit patterns and operations. We must think smartly about how we can survive and flourish during this time of relative peace.
Secretary [of the Air Force Sheila] Widnall and I are confronted with two broad tasks to meet this challenge. On the one hand I've got to keep the forces ready for action today. On the other hand we've got to build relevant forces for tomorrow.
If you think about it, there's almost nothing that a chief can do to mess up readiness in the near term -- by that I mean the next one to two years -- because most of the readiness equation is already set in motion. Now there are things that people external to the force can do, relative to compensation of the force and the employment of the force -- all these things can have some impact.
Now as I look at near-term and far-term objectives, there's a balancing act between readiness, force structure and modernization. Within readiness, a very high percentage of that account involves people -- quality of life programs, pay, compensation. I will tell you that if you talk to a young maintenance officer or young staff sergeant on the line, having spare parts to repair airplanes or repair missiles is a quality of life item for them. So, it's hard to separate readiness from quality of life issues.
These are the only three basic pots of money we have, and this administration is fully focused on near-term readiness. But as I look at our force structure, the Air Force made very deliberate decisions when we came out of the Bottom-up Review. We were told what our end-state was going to be, and as an institution we elected to accelerate the drawdown to that force structure.
Unfortunately the Air Force is normally described by one of those inside the beltway terms as "20 tac [tactical] fighter wing equivalents" -- 13 active and seven Guard and Reserve. The fact of the matter is the Air Force is much broader, much more complex and brings much more to the nation in terms of capabilities than just 20 tac fighter wing equivalents. At any rate, we accelerated our drawdown to that number, took the money that we saved by not hanging onto force structure that was going to go away, and invested that money in near-term readiness. So today we have a very ready force.
We also have a force that has some personnel tempo problems. While we invested that money in normal readiness items, we did not shift the funding into weapons systems that this environment utilizes more than the Cold War did. That's why we find ourselves with personnel tempo problems in AWACS [Airborne Warning and Control System], ABCCC [Airborne Battlefield Command and Control Center] and certain of our functional areas involving personnel like tanker-airlift control elements and combat control team people. So we have brought down our force structure and think we have it about right. In fact, I don't want more force structure in the near term, and I don't want less. I want to be able to operate with the forces that I have, so we can make some fact-based decisions on whether or not it is right for the level of tasking we have.
And then we have the modernization account. I think we have built a balanced modernization program. But it is the place, I'm afraid, that people will raid and try to squeeze more money out of the defense budget, even though this account is down 60 percent during the past decade. So our challenge for those on the Air Force team is to find smarter ways of doing business, to get the most for our procurement dollars.
And we've got some room for improvement here. You may have heard about a recent DoD study that asked a simple question: "What is the cost of doing business with the military?"
I must tell you that when I read the report the results were disappointing, but perhaps not unexpected. It estimated that 18 cents of every defense dollar went to meet service overhead requirements. In some high-tech areas the cost was as much as 27 cents out of every dollar. I realize that this number will never be zero, but it's also dollars that buy you zero combat power.
Now when I was introduced, you heard that I have an advanced degree in history. I'll confess to you ... that I'm not an engineer, that I'm not an expert in contracting or procurement. But I will tell you that history gives you a perspective to look at how we did things in the past and gain insights into how we can do things better in the future.
What comes to mind is how we built front-line, premier aircraft during World War II. Let me put this in perspective. In 1939 Gen. Frank Andrews thought the United States had a fifth- or sixth-rate air force. Here's why he said this. When Germany invaded Poland, the Luftwaffe had over 4,000 combat aircraft. During this time the Royal Air Force had 2,000 combat planes. By comparison, the United States had only 800.
But by the end of the war our aircraft industry had produced over 130,000 fighter and bomber aircraft for the Army Air Forces alone. I think everybody knows the stories of how aircraft factories produced one aircraft every 24 hours, and we were turning out ships every two or three weeks. So the aircraft industry, which was ranked 41st in size before the war, became the leading sector of our economy by 1945. That's an impressive gain for any service and its industrial base.
I think we can learn some useful lessons by looking at how we did this. I will tell you that there were two words that described this: trust and teamwork. Take a look at the P-51.
In May of '40 a couple of North American [aviation company] engineers sketched out a design concept on paper, and that sketching took three days. By September they flew the first prototype. The following August, 1941, they delivered the first combat aircraft. Think about that -- 15 months from paper to rubber on the ramp. That's quite an accomplishment.
I'll admit this may be an unfair comparison. After all, in 1940 as a nation we were ginning up a wartime economy. We threw lots of money at the problem. And the P-51 is a great airplane and a quantum leap forward in technology and capability for those days, but it is a much simpler airplane than today's F-15 or tomorrow's F-22. But there are insights we should pay attention to.
For example, the Army Air Forces asked for this plane, they didn't have a six-inch-thick requirements document. The requirements were stated in about a page or two. Industry knew the basic objective -- to make fighter aircraft capable of air-to-air and ground attack. Then they produced it. Industry was turned free to make configuration and design changes autonomously, to give the customer the most capable aircraft possible as fast as they could. They weren't smothered with lots of inspectors, nor did they have to write reams of reports and documentation. Trust, teamwork and confidence defined how the service and industry worked together.
Today I think we're on the verge of renewing this kind of relationship. And we have support for acquisition reform on the (Capitol) Hill. We have support in the secretary of defense, a man who is very much in favor of acquisition reform. If we are to survive and flourish, we must do this. I'd like to take a few moments and describe what the Air Force is doing in this area.
To me these actions are part of making industry a player on the Air Force team. I've got three examples that I'll share with you. First, I think we're genuinely trying to get out of the milspec [military specification] business. We no longer are going to have a lot of Air Force specifications. Instead, we try to rely on proven commercial standards, whenever possible. We've already seen dividends in this area.
A prime example is the lightweight GPS [Global Positioning System] receiver. Now here's a product that was already in development for commercial use. Had we laid on a bunch of Air Force-unique specs, we probably could have been successful in driving the cost up to $5[,000] or $10,000 per copy. Instead, by relying on the existing technology, we not only got the hardware quicker, but also reduced the cost to $1,200 per receiver.
That's an example of how a service can state the form, fit and function of a product and not get bogged down in the technology aspects or production aspects. It's a smarter way of doing business.
I think that too often in the past we tried to inspect-in quality and got all wrapped up in the details. We've come to the realization that this is the wrong approach. So cutting down on oversight is the second example of how we can work better with industry. And it's an effort that comes in two parts.
First of all, right up front we need to reduce the number of visitors who stop by and visit aerospace firms. I recently discussed this with one major company. They told me how they had over 12,000 visitors in one year at one plant.
Now I'll grant that some of these visits were there on legitimate business. But most were just "dropping in" to check on things, almost like tourists. We can't be in the business of running a tourist agency. So we've got to attack this problem. And I'll tell you that as the chief, I'm going to go to work on this problem. And I think I know how to work the problem. It has to do with funding. It's one of those things that the old programers taught me -- if you get them by their funding, their hearts and minds will follow.
So if you work for one of these firms and there's a problem with too many Air Force visitors, I want to know about it. I want to help. I'm serious. Because I'm disappointed to find that after [Secretary of Defense] Dr. [William] Perry put his letter out on the street on acquisition reform, many of you don't think there has been much change at all. We're still bogged down in our acquisition community trying to do business as we always have done business. So I've got to work that.
Now you may look at this and say that I'm the chief of staff of the Air Force and acquisition belongs to the Secretary [of the Air Force]. The fact of the matter is, I'm the secretary's chief of staff. And so I'm the chief of staff for the whole Air Force. I have a charter to make the whole Air Force work better for our secretary. And after all, you've got to cut down on visitors because you already have inspectors "living" in your factories, day in and day out. I think cutting back on these permanent party group of folks is the second part of our effort to reduce oversight. I'll tell you that we have a narrow window. We've got to strike now, while [we] have someone like Secretary Perry and [Deputy Secretary] John Deutch in OSD [Office of the Secretary of Defense] pushing this. We've got to do it.
Recently I was talking with Vice Admiral Ed Straw, who runs DLA (Defense Logistics Agency). He now has an additional duty. He took over the Defense Performance Review when [Air Force Lt. Gen.] Tom McInerney retired. Ed told me about one of their initiatives for a "reinvention lab."
With this lab, he said DoD will remove inspectors from eight companies where the firms have a proven track record of producing high-quality, on-time goods. This initiative will start with Boeing, Texas Instruments, Raytheon, Hughes, Lockheed, Loral Vought, Martin Marietta and Magnavox Electronic Systems Co. And DoD will remove more inspectors from other production areas once the manufacturing processes are under control.
So this is the second part of our efforts to make trust, not oversight, the basis for our relations with industry. Cutting down on inspectors and number of visitors saves everybody money -- industry and the Air Force. So I think it's a step in the right direction.
A third example that I hope will build trust and teamwork between us is in how we go about buying things. Here I'm thinking about a paperless procurement process. Again, this is an area that offers us an opportunity to save in overhead costs. And the JAST [Joint Advanced Strike Technology] program is leading the way. If you haven't heard, let me take a minute and tell you what they've done so far.
In February of 1994 they issued a request for concept exploration studies, a first step in the aircraft design process. To speed up that process and save industry and government time and money, they required all contractors to submit proposals electronically. Well they received 154 separate proposals. Using the old methods the JAST program office calculated they would have needed 13 weeks to evaluate the proposals, employed four clerks, and they would have had to find a way to store over 130,000 pages of documentation.
But by using the electronic medium JAST awarded the contract in two weeks, employed one clerk and used no paper at all. The entire process -- from concept to contract -- took only four months. If they had used the established methods, it would have taken over a year. The bottom line is that the process was faster, it was more responsive to new ideas, and it cost less.
This paperless approach means a change in our culture. We're used to having a piece of paper, a document, something to carry around. I think we need to make that a thing of the past. Let's face it, there are enough legacy programs out there to keep us involved in paperwork for a long time. When we move forward, we should not ever get engaged with paperwork again.
The good news is that I think most aerospace firms have already stepped up and are ahead of DoD. They're trying to get us on board. And the Air Force is working in this direction. We're extending this streamlined process to our procurement for the Expendable Launch Vehicle. This is a clear example of how we're breaking away from the Cold War business mindset.
I know that there are other success stories out there. The integrated product teams are one example. Another is allowing contractors to control configurations later in the development process. I think all of these are smarter ways to do business.
But my plea to you is that if you have other ideas, share them with me and with those in the aerospace industry. We need lots of inputs to keep us moving forward.
I also know that you need to see some results. And so I don't want this to be one of those things where we go study the problem again. We know what the problem is. I need to know where I can take some action within my organization to facilitate reductions in overhead, in time, in dollars if we are to build this teamwork.
Those are some ideas of what we've been doing. But including industry as part of the Air Force team is about more than just finding solutions to our problems. It's also about sharing credit.
I remember after Desert Storm the men and women flying and maintaining the weapon systems got the praise and parades. But those who designed and developed the systems that those folks operated deserve equal recognition -- recognition that has not been there. You often get a lot of criticism when things are messed up, and we've forgotten to come around, square the circle and give credit where credit is due.
We're all part of one team. Our job is to provide this nation the world's finest air and space forces. Industry's a big part of this team. That's how Hap Arnold saw it five decades ago.
From my perspective industry has always played a part in getting our folks to the fight, accomplishing the mission and returning safely. We can't do it without you. Today we have a common challenge -- to survive and flourish in peacetime. We've succeeded in the past by trusting each other, by working together. That's how we did it when we spun up for World War II -- it's how we can do it today.
It's a new concept of a total force. And it's one that is right for the Air Force, industry and our nation.
Published for internal information use by the American Forces Information Service, a field activity of the Office of the Assistant to the Secretary of Defense (Public Affairs), Washington, D.C. Parenthetical entries are speaker/author notes; bracketed entries are editorial notes. This material is in the public domain and may be reprinted without permission