Disruption Management in the Defense Ammunition Industrial Base By Saheed A. Hamid
B.S. in Mechanical and Aerospace Engineering, December 1989, New York Institute of Technology M.S. in Aeronautical Science, May 1999, Embry-Riddle Aeronautical University
A Dissertation submitted to
the Faculty of School of Engineering and Applied Science of The George Washington University in partial satisfaction of the requirements for the degree of Doctor of Philosophy
January 31, 2014
Dissertation directed by
E. Lile Murphree Professor Emeritus of Engineering Management and Systems Engineering Thomas Andrew Mazzuchi Professor of Engineering Management and Systems Engineering
The School of Engineering and Applied Science of The George Washington University certifies that Saheed A. Hamid has passed the Final Examination for the degree of Doctor of Philosophy as of November 5, 2013. This is the final and approved form of the dissertation.
Disruption Management in the Defense Ammunition Industrial Base
Saheed A. Hamid
Dissertation Research Committee:
E. Lile Murphree, Professor Emeritus of Engineering Management and Systems Engineering, Dissertation Co-Director Thomas Andrew Mazzuchi, Professor of Engineering Management and Systems Engineering, Dissertation Co-Director Shahram Sarkani, Professor of Engineering Management and Systems Engineering, Committee Member
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Dedication
To my parents, had it not been for their example, support, and sacrifices I would have never gotten to this point in my life. And to my wife, my biggest fan, without whose unwavering love and support I may have ended up flipping burgers for a living!
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Acknowledgements
Very few endeavors in life are individual. The sum of knowledge and experiences come from the people with whom we have the privilege to interact, especially those that enrich or enlighten by their advice and experiences. To those friends and colleagues that have provided support, feedback and candid criticism over the years, I am eternally grateful! And to my professors, who exhibited immense patience and flexibility through military deployments and the demands of a full time career while enrolled in this program, I thank you. Completing a program leading to a Ph.D. while trying to balance research, studies, work, and family commitment is, to say the least, challenging. Your support, commitment, and understanding are sincerely appreciated.
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Abstract of Dissertation
Disruption Management in the Defense Ammunition Industrial Base Since September 2001, the Department of Defense (DOD) has focused a lot of attention on its capabilities to fight and prevail in multiple, simultaneous global conflicts.
To successfully meet the demands of such a mission, a consistently responsive Defense
Ammunition Industrial Base (DAIB) that delivers unique supplies through a secure supply chain is essential.
Military supplies frequently have unique functions that are not widely used elsewhere; often, only one or limited numbers of producers of this materiel exists, many of which are single points of failure (SPOF). Examination of current DAIB systems reveals that the critical importance of this aspect of DOD success is often poorly addressed. In addition, methods for evaluating threats to what should be a secure supply chain are shown to be inadequate. If DAIB facilities are destroyed or severely damaged by acts of terrorism, natural or manmade disasters, what would occur? With limited alternatives for replacements, what recourse does the military have for acquiring these one-of-a-kind supplies? If ammunition is the lifeblood of the fighting forces, then having the appropriate types available in the required quantities is essential to combat effectiveness.
This paper focuses on the DAIB by taking a closer look at its history and the risks to existing facilities, which are created by their current locations and facility vulnerabilities.
Within this discussion, several possible solutions arise, with developing a redundant capability within the DAIB being the most viable.
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Table of Contents
Dedication ...... iii Acknowledgements ...... iv Abstract ...... v Table of Contents ...... vi List of Figures ...... viii List of Tables ...... ix List of Symbols ...... x List of Acronyms ...... xi Chapter 1 – Introduction ...... 1 1.1 Description of the Problem ...... 4 1.2 Hypothesis ...... 10 1.3 Research Purpose ...... 10 1.4 Significance ...... 10 1.5 Scope ...... 11 1.6 Organization ...... 11 1.7 Relevance to Systems Engineering ...... 11 1.8 Assumptions ...... 13 Chapter 2 – Literature Review ...... 14 2.1 Infrastructure Assessments ...... 15 2.2 Threats ...... 19 2.2.1 Terrorism Threat ...... 19 2.2.2 Natural Disasters...... 20 2.3 Possible Solutions ...... 22 2.4 Supply Chain Disruptions ...... 25 Chapter 3 – Background ...... 27 3.1 Mission and History ...... 27 3.2 A Brief History of Strategic Disruptions...... 30
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3.3 Decline and Consolidation ...... 32 Chapter 4 – Analysis of Current Threats ...... 36 4.1 Risk Assessment ...... 38 4.2 Interdiction by Terrorist ...... 40 4.3 Earthquakes ...... 44 4.4 Hurricanes ...... 49 4.5 Tornadoes ...... 52 4.6 Disease, Illness and Natural Disasters ...... 59 Chapter 5 – Analysis of Possible Solutions ...... 62 5.1 Analysis of Possible Solutions ...... 62 5.2 Systems Engineering and Design ...... 62 5.3 Commercial Off the Shelf ...... 63 5.4 Stockpile (Storage) ...... 66 Chapter 6 – Conclusion ...... 71 6.1 Dual Sources ...... 74 6.2 Application of CARVER ...... 77 6.3 Future Research ...... 84 Bibliography ...... 85
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List of Figures
Figure 1-1: Current Locations of Ammunition DIB Facilities ...... 9
Figure 3-1: Overall Decline of the Army’s Organic Facilities ...... 33
Figure 4-1: Areas of Highest Earthquake Activity or Probability ...... 45
Figure 4-2: Isoseismic Representation (in %g) or Ground Acceleration ...... 48
Figure 4-3: Top 30 U.S. Damaging Hurricane Tracks ...... 52
Figure 4-4: Annual Average Number of U.S. Tornadoes, 1991-2010...... 54
Figure 4-5: Annual Average Severe Tornado Events, 1991-2010 ...... 55
Figure 4-6: Largest Recorded Tornado Event ...... 57
Figure 4-7: Super Outbreak of 1974 ...... 58
Figure 4-8: 2008 Super Tuesday Outbreak ...... 59
Figure 6-1: Risk Factor Susceptibility ...... 83
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List of Tables
Table 1-1: 12 Pitfalls of Systems Engineering ...... 12
Table 2-1: National Critical Infrastructure Policy History from 1983-2003 ...... 16
Table 3-1: DIB Segments and Sub-Segments ...... 28
Table 3-2: DAIB GOCO Plants and Core Processes ...... 29
Table 4-1: USGS Shake Map: New Madrid ...... 46
Table 4-2: Saffir-Simpson Hurricane Classification Scale ...... 49
Table 4-3: The Enhanced Fujita Scale ...... 53
Table 6-1: CARVER Matrix for Current DAIB Facilities...... 82
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List of Symbols
C Consequences
EP Expected probability of hurricane landfall
Probability of attack
Probability of Failure
Probability of success
P Annual average number of hurricanes in the last 100 years
R Risk
T Threat
V Vulnerability
X Number of hurricanes expected in the coming year
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List of Acronyms
AEC Army Evaluation Center
ATEC Army Test and Evaluation Center
AOC Army Operations Center
ARSOF Army Special Operations Forces
BAe British Aerospace
CBO Congressional Budget Office
CDC Centers for Disease Control
COTS Commercial off the Shelf
CSIS Center for Strategic and International Studies
DAIB Defense Ammunition Industrial Base
DBL Distribution Based Logistics
DCI Director of Central Intelligence
DCIP Defense Critical Infrastructure Program
DCMA Defense Contract Management Agency
DEPSECDEF Deputy Secretary of Defense
DHS Department of Homeland Security
DIB Defense Industrial Base
DOD Department of Defense
DSAP Defense Sector Assurance Plan
EADS European Aeronautic Defence and Space Company N.V
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EF Enhanced Fujita
EMP Electro Magnetic Pulse
FBI Federal Bureau of Investigation
GAO Government Accountability Office
GOCO Government Owned Contractor Operated
GOGO Government Owned Government Operated
HAAP Holston Army Ammunition Plant
IT Information Technology
JSIVA Joint Staff Integrated Vulnerability Assessment
MIC Market Impact Committee
MIL STD Military Standard
MPH Miles Per Hour
NCDC National Climatic Data Center
NDS National Defense Strategy
NHC National Hurricane Center
NMS National Military Strategy
NOAA National Oceanographic and Atmospheric Administration
NSS National Security Strategy
OEF Operation Enduring Freedom
OIF Operation Iraqi Freedom
PCCIP President’s Commission on Critical Infrastructure Protection
PEO Program Executive Office
POTUS President of the United States
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QDR Quadrennial Defense Review
QWARRM Quantitative War Reserve Requirements for Munitions
SCADA Supervisory Control and Data Acquisition
SECDEF Secretary of Defense
SPOF Single Point of Failure
TCA Task Critical Asset
UFC Unified Facilities Criteria
USGS United States Geological Survey
WMD Weapon of Mass Destruction
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“No sensible decision can be made any longer without taking into account not only the world as it is, but the world as it will be.” – Isaac Asimov
Chapter 1 – Introduction
Since September 2001, the Department of Defense (DOD) has focused attention on its capabilities to fight and prevail in multiple, simultaneous global conflicts. To successfully meet the demands of such a mission, it is essential that the Defense
Ammunition Industrial Base (DAIB), which delivers unique supplies through a secure supply chain, be consistent and responsive to those requiring its supplies. Since military supplies frequently have unique functions that are not widely used elsewhere, this often results in the existence of only one or a limited number of the producers of this materiel, many of whom are designated single points of failure (SPOF) by the very entities whose function it is to secure their existence. One example is the Holston Army Ammunition
Plant (HAAP), a government-owned contractor-operated (GOCO) facility, which produces over 99% of the explosives and propellants used by the armed forces. The existence of many other single producers such as the HAAP creates many single points of failure (SPOF) throughout the DAIB (Anderson et al. 2010). An examination of current
DAIB systems reveals that the importance of this critical aspect of DOD success is often poorly addressed. In an article in Army Sustainment, Colonel Thomas Schorr commented that although studies have been done by prominent organizations concerning the ammunition problem, and recommendations have been made for “fundamental change in the management of our ammunition industrial base” (Schorr 2011), there has been little attention paid to these recommendations.
In addition, organizations identified in this study, which include the Government
Accountability Office (GAO) and the DOD Inspector General among others, have shown
1 that many of the methods used to evaluate risks to what should be a secure supply chain are inadequate. If these DAIB facilities are destroyed or severely damaged by acts of terrorism, or natural or manmade disasters, what would the Department do to replace their capabilities? With limited alternatives for replacements, what recourse does the military have for acquiring these one-of-a-kind supplies? Bombs and rockets are not very prevalent in everyday commercial industry, and if ammunition is the lifeblood of the military, then having the appropriate types available in the required quantities is essential to combat effectiveness. This dissertation focuses on the DAIB by taking a closer look at its history and the risks to existing facilities, which are due mainly to their current locations and vulnerabilities. Within this discussion, several possible solutions arise that range from stockpiling to outsourcing, with developing a redundant capability within the
DAIB being the most viable.
Supply chains have existed as long as there have been manufacturers, and they have always been complex. Even Stone Age man had to find the right type of rock to make spear points for hunting. Whether it was the sources of flint, obsidian or bone that were used to make the spear points, or the animal hide used to grasp the pieces that were being worked, or even the forest where the shafts for the spears were cut, there has been some form of supply chain on which the finished products depended. Without these items the group’s hunting abilities were severely curtailed. If only one source or supply in this system was affected and there was no resilience built-in, then more often than not the entire system was affected, thus impacting the finished product and could lead to the group going hungry. Consequently, if there is to be little or no disruption in the supply
2 chains or manufacturing of ammunition for the Department of Defense, there must be some element of resiliency built into the supply system (DCMA 2007).
Attention to an uninterrupted supply chain and resilient response to disruptions is particularly critical to the modern manufacturers that are part of the Defense Industrial
Base (DIB) that supports the Department of Defense’s (DOD) mission to fight and prevail in multi-faceted conflicts around the world. Companies that comprise the DIB must adequately address risk and have some fallback plan should they become unable to provide a system or subsystem to a military customer because a supplier’s (or their own) facilities, are not functional (Hamid et al. 2013). And while this may appear to be an obvious concern, the Defense Contract Management Agency (DCMA) DIB Defense
Sector Assurance Plan (DSAP) for 2007 stated that it had just “begun the process of developing the sector characterization criteria and was in the process of determining linkages and dependencies between assets in the DIB and other sectors” (DCMA 2007).
However, the DCMA, in the same document, describes the DIB critical asset prioritization process as “…mature…” (DCMA 2007).
Is the DIB critical asset prioritization process actually mature and does it adequately assess, prioritize and protect the complex worldwide network of assets and facilities to ensure the consistent and secure execution of global DOD operations? This dissertation focuses on the Defense Ammunition Industrial Base (DAIB), which is a relatively small part of the overall DIB. It attempts to show that the DAIB as it currently stands is very vulnerable to systemic disruption. The DAIB, components of which are listed in Table 3-
1, uses exotic materials and requires specialized manufacturing facilities to produce its many products, the details of which are outside the scope of this study. This dissertation
3 also discusses the mechanisms capable of causing large scale disruptions to the DAIB as they currently stand.
Improving and securing the DAIB supply chain must first address the uniqueness of military systems which are supplies and functions that are not widely used elsewhere outside the defense arena. The result is that only one or a few DAIB facilities exist that may produce, maintain, transport or supply raw materials for these specialized items.
Unlike a commercial entity that must develop a product that is in sufficient demand to support its operations, defense facilities support only the government and thus have a limited customer base, which can evaporate fairly rapidly. An examination of the DAIB history later in this study will show that the cancellation of just one defense program can cripple a company if it does not have other outlets for its products. This can result in it being absorbed into other entities in order to survive, or flounder and become defunct for lack of business.
In addition to reviewing the limited number of suppliers, a brief review of the history of military supply chains provides many examples of how supply chain disruptions affect the entire war fighting capability. Since the role of the DIB is to help facilitate the DOD mission by producing the necessary materiel needed to execute the United States’
National Military Strategy (NMS), understanding how military supply chains have developed and operated over the years offers insight into attenuating current supply chain vulnerabilities.
1.1 Description of the Problem
The Army’s Program Executive Office (PEO) for Ammunition estimates that there are 34 ‘critical SPOF’ in the current DAIB supply chain (Zimmerman 2010). Therefore,
4 the office responsible for managing the DAIB knows there are at least 34 entities whose disruption will cause a failure in the DAIB. Along with these SPOF, we will discuss the ongoing disparity in assessing risk to supply chains when they are caused by nature versus deliberate acts of a calculating adversary who analyzes one’s defensive posture in order to find vulnerabilities to interdict. We will show that there appears to be an inordinate emphasis placed on deliberate or manmade disruptions of current infrastructure systems (Brown et al. 2006) and less attention paid to natural or unpredictable disasters. This unreasonable focus points to another weakness in the assessment process, which this dissertation seeks to portray. And that is, that the mechanism of disruption is of less importance than the probability of disruption, specifically that the manner in which the capability is lost is less of an issue than the fact that the capability no longer exists. Therefore all risks should be addressed with equal fervor since their consequences affect our entire military’s combat effectiveness.
Regardless of the mechanism of disruption, the “consequences of the many are the same”
(Nieto-Gomez 2011) as that of the few, i.e., the effects of a few hijackers on September
11, 2001 had a similar effect on the morale, psyche and economy of the United States as the Japanese Empire at Pearl Harbor in 1941.
Also contributing to the vulnerability of the current supply chain is the absence of standard rating criteria and inconsistent inspections among the services. The lack of standardization results in each service using its own set of criteria to determine its Task
Critical Assets (TCA). TCAs are assets of such “…extraordinary importance…” to the overall DOD mission that incapacitation or destruction would have a “debilitating effect”
5 on the military’s ability to fulfill its mission (CJCS 2010). Inconsistency in identifying
TCAs makes prioritization within the entire system difficult.
A primary tool used by the DOD to determine vulnerability of a Task Critical Asset
(TCA) is the Joint Staff Integrated Vulnerability Assessments (JSIVA). This inspection program is conducted primarily on the premise that military facilities are subject to disruptions from terrorist acts, and as one may expect, the remediation activities center on the ‘gates, guards and guns’ paradigm. Consequently, the DOD’s Uniform Facility
Criteria (UFC) was developed primarily to mitigate terrorist attacks. There is much in the literature that the JSIVA is also used to determine how assets are tiered based on a numbered criticality hierarchy, typically “1” to “3,” with one being the most critical.
However, the Government Accountability Office (GAO) found that the DOD’s progress in developing a Tier 1 TCA list, i.e., a list of its most critical assets, was limited by their inconsistent criteria for identifying and classifying TCAs with many of the major commands using disparate criteria for their respective TCA lists.
In addition to inconsistencies in TCA identification, the preponderance of commercial entities in the DIB creates an ongoing problem for enforcing consistent inspections through the Defense Critical Infrastructure Program (DCIP). Because participation in the
DCIP is voluntary for commercial suppliers (DCMA 2007), there is no incentive other than financial for commercial DIB members to invest in DCIP activities.
Compounding the problems listed above are issues with the DOD’s production capacity. Due to shortages experienced in the early days of Operation Enduring Freedom
(OEF) and Operation Iraqi Freedom (OIF), the Department has had to resort to buying commercially manufactured ammunition, even from allies who did not support our
6 positions in these conflicts. Some published information reveals that civilian ammunition supplies have suffered because of America’s protracted wars in the Middle East, and a
Canadian news agency reported that as a result of the U.S. military’s demand, worldwide ammunition shortages have occurred. Some Canadian police organizations have expressed concern over shortages in supplies and police departments in Washington State have reported a 67% increase in ammunition costs due to shortages (CBC 2008). This practice of buying commercially manufactured ammunition to fill a production gap in defense production is not sustainable if the other entities impacted by U.S. manufacturing shortfalls decided to withdraw their support.
Other risks associated with supply chain disruptions range from destructive natural disasters, policy changes affecting business practices, to microbes causing diseases and illnesses in plants, animals or humans involved in the chain. For example, during the
Asian occurrences in the early 21st century of the highly-infectious SARS and Avian and
Swine flu scares, many companies were subjected to some sort of supply chain disruption because suppliers in Asia faced strict export controls on presumably contaminated exports, as well as the movement of their sick employees, causing delays in shipping and consequent disruptions downstream in the supply chains of many products. Similarly, catastrophic events like hurricanes, tornadoes, earthquakes and explosive blasts can severely damage facilities to the point where employee access is severely hampered, critical machinery or equipment is destroyed, or the entire facility is flattened. Such facilities often have high initial capital costs and take considerable time to reconstitute.
In the aftermath of hurricane Katrina, energy and chemical manufacturers along the coast of the Gulf of Mexico spent nearly two years repairing infrastructure damage
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(Teague 2007). At a time when the Department of Defense was engaged in two theaters of operation and had to support several hundred thousand troops and other support personnel with ‘beans, bullets, fuel,’ and other necessities to conduct two wars, the prospect of having to wait sometimes years to restore a capability puts the entire DOD mission in jeopardy. And while it is physically and fiscally impossible to protect against all threats and defray all risks, there must be a better solution to securing critical military infrastructure than just building higher fences and hiring more guards for our facilities.
Natural disasters do not honor fences. And in today’s fast paced global operations every modern manufacturer must have redundant capabilities in order to secure their facilities, supplies of raw materials, parts, or subsystems to ensure that their supply chain is uninterrupted, or minimally disrupted at most. While security is primarily built around the fear that a facility will be interdicted, resilience on the other hand is the confidence that the chance of a system compromise is adequately addressed or that enough failsafe options are in place so that disruption is unlikely or that the consequences are so small that the risks become manageable.
Of all the issues that are identified in the DCIP, the most severe risk to the DAIB lies in the current locations of facilities, as shown in Figure 1-1 below. Further, it will be shown that because current DAIB facilities are located in areas susceptible to severe natural hazards, the United States may be unable to engage in extended combat operations or effectively sustain peacetime training if any of these facilities were severely disrupted. If this occurs, it will present a significant obstacle to the NMS and the DOD’s ability to prosecute its wartime mission.
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Figure 1-1: Current Locations of Ammunition DIB Facilities [sic] - (Zimmerman 2010)
Failure to consider the entire spectrum of large scale disruptions by not adequately accounting for natural disasters suggests that the process currently employed to characterize DAIB assets is far from mature. Some semblance of resiliency in the DAIB is necessary to reduce the associated systemic risk of disruption. In addition, the ability to recover a capability quickly or ‘bounce back’ has an overall deterrent value on deliberate attacks in that a potential terrorist would think twice before attacking a system that has redundancies that they cannot effectively subdue (Edmonson 2008). These elements need to be incorporated into the DCIP.
This dissertation also reviews several possible solutions for addressing the issues of
DAIB disruption, including stockpiling/storing, Commercial Off-The-Shelf (COTS) and dual-sourcing. Evidence provided in the discussion of solutions will support the development of redundant manufacturing capabilities in the locations with adequate data
9 for predicting natural hazards as the most viable route to establishing resiliency in the
DAIB.
1.2 Hypothesis
The principal hypothesis of this dissertation is that the Defense Ammunition
Industrial Base includes of many single points of failure which are located in areas that are vulnerable to disruptions and current safeguards and vulnerability assessment methods do not adequately protect the DAIB, with the main premise being that short term solutions may be available but a longer sighted approach will preclude additional costs and provide resilience for a major source of worry for the DOD.
1.3 Research Purpose
The purpose of this research is to provide a strategic risk analysis for the Defense
Ammunition Industrial Base and to identify some major sources of risk which can cause significant disruptions to its capacity to support DOD operations in protracted conflicts.
What are some major risks facing the DAIB?
Are the current means to mitigate these risks adequate?
What mitigation means might be most effective?
1.4 Significance
A review of the literature reveals a significant amount written about the overall
Defense Industrial Base (DIB), most of which addresses the exotic or technologically advanced aspects of the DIB. The effects of hostile or unfriendly governments controlling the world’s supplies of exotic materials that go into sophisticated electronics or missiles are common concerns. However, very little is written about the oldest parts of the DIB, namely the components of the DAIB which are the parts that have existed for almost a
10 century. Many of the facilities are antiquated and are only now undergoing some modifications, decades after initial construction. This has left them behind as far as manufacturing capability and processes and their neglect over the years has caused them to become single points of failure for a critically important national asset.
1.5 Scope
As previously mentioned, the sheer size of the DIB’s complexity does not lend itself readily to a uniform study. The sectors are too diverse and the issues facing one sector may be totally irrelevant to another. However, the many sub-segments do have some elements in common that may be studied with a fair amount of ease. The segments listed in Table 3-1 afford the researcher common systems with common components to evaluate. Therefore, this research will focus on only one particular segment of the DIB, the ammunition segment (DAIB), which is also the oldest and most overarching of the segments with respect to how they affect all of the military services.
1.6 Organization
The introductory chapter is followed by the Literature Review in Chapter 2 which addresses critical infrastructure threats, risks, consequences and solutions. Chapter 3 provides a background of the issues facing the DIB and DAIB as well as historical perspective. Chapter 4 is an analysis of the current threats to the DAIB and some solutions. Chapter 5 is an analysis of some possible solutions to ammunition supply chain issues and Chapter 6 is the conclusion of the study and suggestions for further research.
1.7 Relevance to Systems Engineering
The Handbook of Systems Engineering and Management defines Systems
Engineering as “…management technology to assist and support policy making, plans,
11 decision making, and associated resources allocation or action deployment” (Sage et al.
2009). Of the 12 Pitfalls of Systems Engineering listed below, this research found issues in the decision making process with 1, 2, 3, 6, 9, 11, and 12, with some relevance to 5, 7, and 8. And it finds issue with the ‘survivability’ aspect of MIL-STD-499C (draft) which requires the identification and evaluation of factors affecting survivability and impacts on system effectiveness (Pennell et al. 2005).
1. There is an overreliance on a specific analytical method or tool, or a specific technology that is advocated by a particular group. 2. There is a consideration of perceived problems and issues only at the level of symptoms, and the development and deployment of “solutions” that only address symptoms. 3. There is a failure to develop and apply appropriate methodologies for issue resolution that will allow (a) identification of major pertinent issue formulation elements; (b) a fully robust analysis of the variety of impacts on stakeholders and the associated interactions among steps of the problem solution procedure; and (c) an interpretation of these impacts in terms of institutional and value considerations. 4. There is a failure to involve the client, to the extent necessary, in the development of the problem resolution alternatives and the systemic aids to problem resolution. 5. There is a failure to consider the effects of cognitive biases that result from poor information processing heuristics. 6. There is a failure to identify a sufficiently robust set of options or alternative courses of action. 7. There is a failure to make and properly utilize reactive, interactive and proactive measurements to guide systems engineering efforts. 8. There is a failure to identify risks associated with costs and benefits, or effectiveness, of the system to be acquired, produced, or otherwise fielded. 9. There is a failure to properly relate the system that is designed and implemented with cognitive style and behavioral constraints that impact users of the system, and associated failure of not properly designing the system for effective user interaction. 10. There is a failure to consider implications of strategies adopted in one of the three lifecycles (RDT&E, acquisition and production, and planning and marketing) on the other two lifecycles. 11. There is a failure to address quality and sustainability issues in a comprehensive manner throughout all phases of the life cycle, especially in terms of reliability, availability and maintainability. 12. There is a failure to properly integrate the new system together with heritage or legacy systems that already exist and that the new system should support.
Table 1-1: 12 Pitfalls of Systems Engineering (Sage et al. 2009)
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1.8 Assumptions
1. Each system or component thereof is vulnerable to disruption.
2. Terrorist organizations will use current TTP where high value, military or national
security type targets will be on their primary list.
3. The United States still faces a risk from outside threats.
4. Global climatological changes will exacerbate the problem of natural hazards.
5. Global climatological changes are natural, inexorable and uncontrollable.
6. The research and data to date on climate are accurate.
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Chapter 2 – Literature Review
A very good, concise history of the DIB and the arsenal system that came before can be obtained from Colonel Ralph’s paper on the DIB published by the Army War College, where he decries the follies of consolidation, the DIB’s inability to respond to surge requirements and the ineffectiveness of assessment tools (Ralph 2004). Ralph also alludes to the operational costs of consolidation and SPOF’s, where he cites numerous examples of single manufacturers of specialty parts, materials or subsystems that became defunct because of a lack of demand in peacetime, and hence the ultimate loss of the capability of that manufacturer.
A similar treatise on the effects of globalization on the DIB by Terrence Guay of the
Strategic Studies Institute, shows that with decreasing demand for arms and armament large defense industries must look elsewhere for business or become defunct. A glaring example is British Aerospace (BAe), long a bastion for British defense procurement, which was relegated to a small fraction of British defense expenditures in the 1990’s and early 2000’s because of the end of the cold war and the fact that Britain was looking outside her borders for a large portion of its military hardware. This made it necessary for
BAe to look elsewhere for customers, mainly the United States. When BAe contemplated moving their corporate headquarters to the United States due to the increased business it was doing there, it prompted the British government in 2006 to promise to make British
Aerospace their “…partner of choice…” (Guay 2007) in certain defense procurements and to increase their procurements from the company in order to have them remain in the
U.K. Watts and Harrison point out the limitations of the old arsenal system, in place from
1812 to World War II, when it became clear that this system was too antiquated to accommodate the demands of a world at war (Watts et al. 2011) which is when the
14 modern DIB (arsenal of democracy) was born. They also contend that there has not been a definitive strategy for preserving the domestic defense infrastructure and the question that needs to be asked, in order to allocate resources wisely, is which sectors of the DIB are truly critical to national security?
2.1 Infrastructure Assessments
Air Force General Robert Marsh, former commander of the Air Force’s Systems
Command and member of the President’s Commission on Critical Infrastructure
Protection (PCCIP), stated that the president had identified eight (8) infrastructures that were our nation’s life support system. They were: Telecommunications, Banking and
Finance, Electric Power, Water, Transportation, Emergency Services, Oil & Gas delivery and Storage and Government Services (Marsh 1997). The military’s defense industrial base and manufacturing infrastructures in general did not claim a prominent place on that list. It was not until the events of 2001 that the importance of military logistics systems came to the forefront, as is indicated in the Table 2-1 below. Since there is no pattern or policy reason backing the choices for critical infrastructure protection in the years preceding 2001, the author surmises that this was likely predicated by history and the recent relevance of the particular sector in the minds of the policymakers of the time. For instance, banking and finance had seen large losses in the Savings and Loan scandals of the late 1980’s and early 1990’s where large sums of money were lost to bad investments and mortgages (FDIC 1997). So the events were relatively fresh in the minds of those seeking to regulate and protect areas of national concern. Similarly, the breakup of the national telephone system, which was initiated in the 1970’s but whose effects and separation pains became more evident in the 1980’s and 1990’s, with the advent of
15 multiple phone companies and the resulting increases in cost and service disruptions, also prompted policy changes and concerns over the telecommunications infrastructure
(Chang 1997).
Table 2-1: National Critical Infrastructure Policy History from 1983-2003 Source (Moteff et al. 2004)
At this point, America had not been in a protracted war since Vietnam, almost three decades earlier, so the importance of safeguarding military supplies was basically forgotten by the public or put on a back burner by policymakers. The commission did determine that there was no ‘magic bullet’ solution to CIP and that the ideal would be to both protect the infrastructures as well as enhance their capabilities. The commission also admitted that they had nothing new to add to the status quo as far as the weaknesses or physical threats posed to infrastructures at the time. Their major finding at the time was cyber vulnerability and security, with “no immediate crisis threatening the nation’s infrastructures.” (Moteff 2003).
Although the concept of ‘key asset protection’ had been around since the 1980’s, which tasked local FBI offices with coordinating information exchange about threats and
16 vulnerabilities of infrastructures within their jurisdictions, it was not until 2003 with the advent of the National Strategy on Homeland Security that defense infrastructure was listed as a key sector, (see Table 2-1). A subsequent Congressional Research Service
(CRS) investigation by the same authors found that the shifting criteria used to determine critical assets could lead to protection inefficiencies, which was further reinforced by a common complaint by the private sector that the federal agencies tasked to oversee these assets in their respective sectors these were not providing stable definitions of what comprised a critical or key asset (Moteff et al. 2004).
Many of the studies conducted in the last decade about the supply chain of military materiel to the soldiers in combat reflect the findings of a qualitative study done recently, which concluded that supply chain managers generally concern themselves with the demand and supply side of the chain and very often discount (not ignore) the operations aspect of the chain (Manuj et al. 2008). The RAND corporation conducted a study of
Army infrastructure in 2008 and concluded that many strategic planning documents did not address long-term infrastructure risks and uncertainties for which the DOD and the
Army should have contingencies (Pint et al. 2008).
The assumption in military circles is that its infrastructure will be attacked when faced by an intelligent enemy; thus it creates a prioritization list of critical infrastructure and then takes steps to “harden or protect that infrastructure or improve its active defenses” (Brown et al. 2006). Most military sites are well secured compared to their civilian counterparts, and the military’s method assumes the “preferred list of defended assets” (Brown et al. 2006) is in need of protection. Defense against an intelligent and deliberate enemy is often not entirely effective as evidenced by the attacks on the
17 property of military bases. Hence Brown et al. propose that we must plan for what is determined to be possible, not what “subjective assessments indicate is likely” (Brown et al. 2006). However, Brown et al. do erroneously assume that the military model does not account for ‘recoverability,’ which is the repair or reconstitution of a disrupted asset.
In 2007, the Defense Science Board (DSB), an organization chartered by the DOD to provide independent advice to the Secretary of Defense presented a report to the
SECDEF titled Critical Homeland Infrastructure Protection, in which it stated that
“Larger issues related to protecting national security mission critical capabilities warrant consideration, and the Task Force recommends that the Secretary of Defense direct an additional study to focus on these concerns.” (DOD, Report of the Defense Science
Board Task Force on Critical Homeland Infrastructure Protection 2007). The DSB also found that the dependence of DOD facilities on non-DOD facilities is not entirely known, there was no policy for commanders to create contingencies for the infrastructures on which they depend, or for the development of risk mitigation plans. Furthermore, it found that the DOD conducts over “two dozen different vulnerability-focused assessments, but falls short in addressing full risk assessment that would include threat, consequences, and mitigation options.” (DOD, Report of the Defense Science Board Task Force on Critical
Homeland Infrastructure Protection 2007). Finally, the DSB recommended that the DOD consolidate its many and disparate vulnerability assessment programs into a single risk assessment program. Interestingly enough, the DSB report did not place significant emphasis on natural disasters, but instead focused primarily or deliberate attacks and man-made disruptions.
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A GAO report in 2009 determined that while the DOD’s Critical Asset Identification
Process (CAIP) is a step in the right direction more work is needed to create a reliable list of critical assets that are at the highest risk (D'Agostino 2009). And as recently as July
2012, the Department of Defense Inspector General (DODIG) found that the fundamental purpose of DOD security, which is the protection of critical assets, was not being met because of fragmentary, inconsistent and overlapping policies. Further, there is no coordination for security among the many defense entities, which they deemed as undermining the DOD mission as well as national security (Ives 2012).
2.2 Threats
2.2.1 Terrorism Threat
This dissertation does not advocate the abrogation of terrorism as a threat; however, it advocates that it should not be the primary consideration since the mechanism of disruption is of less importance than the disruption itself. Terrorism is not a new phenomenon; it has occurred in one form or another over the centuries; and only in the last 30-50 years and most notably in the last 10 has it become foremost in the public eye.
Nieto-Gomez contends that even though terrorism should be a large part of any asymmetrical threat assessment, “the narrow framework of terrorist conduct does not suffice to describe the homeland security threat posed by the few” (Nieto-Gomez 2011).
James Lewis, a senior fellow at the Center for Strategic and International Studies CSIS believes that “Cyber terrorism is not a threat at this time” (Lewis 2011). In a paper in the
Engineering Management Journal, Letens et al. expanded on this by stressing that even though risk management has become a more established discipline with standardized taxonomies, many risk lists still tend to put more emphasis on certain types of risks and
19 sometimes even omit other types, making analysis that much more difficult (Letens et al.
2008).
The University of Maryland’s National Center for the Study of Terrorism, in a study conducted on the incidence of terrorism between 2002 and 2011, found that the United
States had the “…largest decline in terrorism activity…” in this period and was ranked far below China and The United Kingdom who were 22nd and 28th respectively, yet we spend “considerably more money on developing homeland security technology than is spent by any other national government” (Carafano et al. 2006). The Wall Street Journal reported that entire bureaucracies have been created to counter terrorism and even the focus of the Federal Bureau of Investigation (FBI) has turned from fighting crime, which was its original charter, to fighting terrorism (Seib 2013).
2.2.2 Natural Disasters
Infrastructures of all types, critical or otherwise, are susceptible to natural and manmade disasters, as Everleigh, Mazzuchi and Sarkani pointed out in their evaluation of systems at risk in the physical world (Everleigh et al. 2007). And in order for a manufacturing entity to survive these hazards prudent strategies must be incorporated into their production systems designs in order to provide flexibility in the manufacturing process (Abdel-Malek et al. 2006). Berman et al. address some aspects of facility design in their paper where they state that disruption of facilities is not prominently featured in the literature as far as the effects of the facility’s location (Berman et al. 2007).
The USGS estimates that the probability of a major destructive earthquake in the New
Madrid, MO area is 50%, and that this area has a history of large earthquakes of magnitude 7 -8 (Williams 2009). The USGS has also determined that earthquakes in the
20 eastern parts of the U.S. are felt over areas 10 times larger than those occurring in the western parts, so the areas affected tend to be larger (USGS 2011); and Stover and
Coffman predict that a similar magnitude earthquake will be more destructive in the eastern United States than in the west (Stover et al. 1993). In addition, the most severe earthquake experienced in North America in the past few hundred years occurred at the
New Madrid fault (Gomberg et al. 2002). The National Oceanic and Atmospheric
Administration (NOAA) Coastal Services Center lists at least 166 hurricanes of varying intensities that have gone through the study area between the 1850’s and 2010 (Blake et al. 2011), which attests to the area’s predisposition to these phenomena. Blake et al. reported that since 1851 there have been 53 severe (H3-H5) hurricanes recorded in the area of study.
NOAA has also designated another area similar to the one known as ‘Tornado Alley’ in the Midwest, as ‘Dixie Alley’ which is located in the eastern part of the United States and is co-located with the current locations of the DAIB. There are no agreed upon boundaries of these areas. The National Climatic Data Center in Norman, Oklahoma considers the area from central Texas, extending north to central North Dakota and roughly bounded by the borders of those states as Tornado Alley. Dixie Alley is roughly bounded by Louisiana, Alabama, Arkansas, Tennessee and Mississippi. This area is lesser known but just as prone to destructive tornadoes as its Midwestern counterpart.
NOAA also reports that about 0.1% of the 1000 or so tornadoes that are recorded in the
U.S. annually have wind speeds in excess of 200 miles per hour. The largest tornado events that have been recorded in this area were the Tri-State tornado event of 1925 and the ‘super outbreaks’ of 1978 and 2008 (NOAA 2010).
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2.3 Possible Solutions
Not many studies have been conducted on the subject of supply disruption where dual suppliers are considered, Tomlin’s research identified only two such papers (Tomlin
2006), this was further ascertained by research done by Schmitt, who contends that though, “…industry trends are increasing supply risks…supply chain disruptions are not very well understood” (Schmitt 2008). The current national defense and homeland security entities are large bureaucracies tasked with safeguarding America’s critical infrastructure and as Nieto-Gomez points out, these bureaucracies are mostly reactive and not proactive and have structural limitations in their reactions to asymmetrical threats
(Nieto-Gomez 2011). This type of threat does not have a commonly accepted definition but is generally considered to include threats caused by acts of terrorism, any form of disruption, insurgency, information operations and ‘unknown’ threats (Buffaloe 2006).
Bureaucracies are good at mitigating ‘sustaining threats’ so their natural inclination would be to ‘beef up’ security, hence the ‘gates, guards and guns’ paradigm of current policies and processes.
However, a new strategy is needed to mitigate the ‘permanently disrupted’ environment in which we currently live (Nieto-Gomez 2011). Enhancing the security and capabilities of current facilities is only part of that new strategy. He further states that while the systemic mission of addressing incremental threats is currently acceptable, addressing the threat of ‘future shock’ is almost nonexistent. This process creates an environment where policy makers see these efforts as effective and are therefore inclined to allocate more and more resources to programs that appear to be working as listed in the Congressional Report RL 31465, which is a critical infrastructure protection catalog
22 of federal assistance programs designed to “prevent, deter or interdict a terrorist attack on critical infrastructure assets” (Moteff 2002).
Of the studies done to identify one or another issue within the supply chain of the
DAIB, one of note was a RAND report completed for the Army which identified four options for managing the plants and none of them included the issues identified in this dissertation (Hix et al. 2003). The conclusions were presented mostly from a business operations and management perspective. However, the report did affirm that since the requirements for future conflicts are uncertain, it recommended among others stockpiling, improving conventional munitions and buying expanded manufacturing capacity. This could be construed as building additional facilities at different locations.
Redundancy appears to be a plausible solution given current threats and conditions.
Brown et al., in their paper Defending Critical Infrastructure, point out that the critical components of infrastructure systems must be protected, but just hardening of infrastructure can prove to be expensive. However, if the nature of the most damaging attack can be understood, then “a system’s robustness can be improved for a given budget,” (Brown et al. 2006) since critical infrastructure is generally built with cost effectiveness in mind and not necessarily the occurrence of belligerent attacks.
Therefore, an “appropriate level of redundancy or reorganization” (Brown et al. 2006) will benefit security at little expense, which is similar to paying a small insurance premium against the threat of catastrophic loss of a facility or capability.
In their study of manufacturing decisions of supply chain disruptions that are made in the presence of asymmetric information concerning suppliers, Zhibin et al. asserted that there are many choices in managing supply risks, including multi-sourcing. They
23 concluded that when backup production is not cheap, the benefit of said backup increases in the presence of asymmetric threat information about the reliability of a manufacturer
(Yang et al. 2009). They further surmised that this would hold true even if demand were stochastic rather than deterministic.
The Aerospace Industries Association pointed out in a report that although a strong historical partnership between the industrial base and the DOD has ensured America’s success in past conflicts, the DOD’s weakening of this alliance and the view that defense planners take this relationship for granted may lead to future issues in defense capabilities
(Blakely 2009).
A Journal of Commerce article proposed that a prudent company that plans to continue operations after a disruption to their supply chain must incorporate all disruptions into its contingency plans (Edmonson 2008). Further, it states that having plans to restart and ‘bounce back’, i.e., some form of resilience, has a deterrent value to deliberate attacks. It provides reassurance against natural hazards as well. Byrne identified several risks to supply chains and one of the top three happened to be natural disasters (Byrne 2002). Furthermore, respondents to Byrne’s survey on disruption mitigation strategies identified the following: 62% supported local as well as global manufacturing capabilities, 61% said they would source contingent suppliers and 50% of respondents favored a geographically dispersed supply base (Byrne 2002).
Song et al. modeled an inventory system with dual sources, one with normal lead times and another for emergency or much shorter lead times, but the latter was a more expensive one. They found that in the presence of stochastic or unsteady demand, as is usually the case for ammunition in a combat situation, the supply is ‘steady-state’ and
24 simple if there is enough stockpiled or the supply is reliable (Song et al. 2009).
Kleindorfer, in his list of mitigation options, lists, among others, diversification, which included facility locations as one of its recommendations (Kleindorfer et al. 2005).
2.4 Supply Chain Disruptions
As far back as 1988, studies were conducted to determine the efficacy of the DOD’s storage and resupply capabilities in times of active combat. A study by RAND aimed at identifying, “…alternative logistics structures on war-fighting capabilities” (Berman et al.
1988) determined that there was a need for a reexamination of the Army’s logistics processes for supporting combat operations, or “…invest inordinate amounts in inventories to prevent losses in combat capability.” (Berman et al. 1988). A subsequent study done for the Army ten years later by the Arroyo Center concluded that the massive stockpiles that were a vestige of the Cold War’s ‘just in case’ scenario became less effective and affordable for the Army’s current force projections (Wang 2000).
The GAO reported in 2011 that of the 17 recommendations they have made regarding logistics, security, stockpiling etc. since 2005, the DOD had only implemented about 9 to that point (Solis 2011), and Manuj and Mentzer recommend ‘hedging’ storage facilities which included geographically separated entities such that a single event does not disrupt all facilities at the same time (Manuj et al. 2008). Chao identifies some reasons for holding inventories, especially in stochastic demand situations and creates a model similar to those used in dam construction theory, and also similar to that used in Chen et al. (Chen et al. 1992) to predict storage requirements in the presence of supply disruptions (Chao 1987). Chao describes stochastic or unexpected shifts in demand as disruptions in supply, which is exactly how demand is seen in a combat scenario. These
25 demand shifts are also prevalent in combat operations. Some research shows that a decentralized, i.e., multiple storage, solution is less prone to disruptions (Schmitt 2008) which may alleviate one issue but may contribute to or create other issues as will be described later in this study.
RAND’s Arroyo Center produced a study that alluded to the fact that many in the defense community believed the war in Iraq was successful despite “severe logistics problems” (Peltz et al. 2005) and the application of Distribution Based Logistics (DBL).
This process depended on small limited inventories to cover disruptions in supply flow because it relied heavily on frequent resupply. However, the authors pointed out that critical elements needed for this method to be effective were not present, and therefore, it relied on superhuman efforts to make up for shortcomings. And while other supplies remained ‘robust’ for items like fuel, food and water, the unpredictable and variable demand for ammunition makes critical shortages “more likely to develop” (Peltz, et al.
2005). Colonel Ralph of the Army War College supports the “overhaul of outdated regulations” in order to “…attract innovative companies” (Ralph 2004) into the DIB, which included modern manufacturing processes and facilities.
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“We are putting forth our energies, our resources and our organizing powers to give you the strength to regain and maintain a free world. We shall send you, in ever-increasing numbers, ships, planes, tanks, guns.” – Franklin Delano Roosevelt Chapter 3 – Background
The Defense Production Act of 1950 was created to enable the United States to foster relationships with industry, promote policies and stockpile important materials to ensure that defense related items were readily available for executing the national defense strategy, which in effect created the DIB as it stands today. However, it has existed in one form or another for over seventy years. The Department of Homeland Security (DHS) characterizes the DIB as follows: “The Defense Industrial Base (DIB) Sector is the worldwide industrial complex that enables research and development, as well as design, production, delivery, and maintenance, of military weapons systems, subsystems, and components or parts, to meet U.S. military requirements. The Department of Defense
(DOD) is the Sector-Specific Agency (SSA) for the DIB Sector” (DHS n.d.). This defense sector consists of more than 100,000 companies, as well as their subcontractors, who perform work for the DOD under various contracts. This also includes companies that provide incidental services and materials to DOD’s government-owned/contractor- operated (GOCO) and government-owned/government-operated (GOGO) facilities located around the world and within the United States and its territories (DHS n.d.).
3.1 Mission and History
The current mission of the DIB is to help facilitate the DOD’s mission by producing the necessary materiel needed to execute the United States’ NMS. It consists of ten major sectors which are further divided into sub-sectors, as depicted in Table 3-1 below.
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Segment Sub-segments Segment Sub-Segments Missile -Tactical Missile Ammunition -Bombs & Warheads -Torpedo -Cartridges & Fuses -Strategic Missile -Explosives Aircraft -Fixed Wing Weapons -Small -Helicopter -Medium -Unmanned Aerial vehicle -Large Troop Support -Soldier Systems Information -Command, Control, -Clothing & Textile Technology Computers & -Subsistence Medical Intelligence -Smoke Obscurant -Information Security -Nuclear, Biological, -Trainers & Simulators Chemical Systems -Computer Peripherals Space -Launch vehicle Shipbuilding -Surface Ships -Satellite -Subsurface Combat -Tracked Vehicle Electronics -Electronic warfare Vehicle -Tactical Vehicle -SONAR -RADAR
Table 3-1: DIB Segments and Sub-Segments (DOD 2007)
Many of the components comprising the present day DIB were first put into operation to supply our allies during WWII when President Roosevelt exhorted the “…arsenal of democracy…” (Schorr et al. 2010) to support those fighting in Europe against the Nazis.
However, the majority of the DIB has undergone major changes over the decades since its inception. Many modern weapon systems have changed considerably from their WWII ancestors; modern fighters and tanks are comprised of cutting edge technology and are produced in very modern manufacturing facilities. On the other hand the DAIB, shown in
Table 3-2, which is the ammunition producing part of the DIB, has been around in much of its current configuration since WWII. It has consisted mainly of government owned facilities run by commercial companies (GOCO), which is a vestige of the arsenal system that came before.
Springfield Armory, originally located in Springfield, Massachusetts, existed as a part of the Armory system established by George Washington in 1777 and continued as such for almost 200 years until it was finally closed in 1968. This was the armory where the
28 famous and ubiquitous U.S. rifle, the M-14, was developed for the U.S. Army following
WWII (Rayle 2006).
FACILITY CORE PROCESSES Radford AAP (VA) Propellant (Rocket, Artillery, Tank, Medium Caliber) Lake City (MO) Small Caliber Holston AAP (TN) Explosives Scranton (PA) Large Caliber Projectile Metal Parts – Mortars/Artillery Iowa AAP (IA) Load, Assemble & Pack (Tank, Artillery, FASCAM) Milan (TN) Load, Assemble & Pack (40 MM Cartridges, C-4 Extrusion) McAlester AAP (OK) Bombs, Intelligent Munitions Pine Bluff Arsenal (AR) White/Red Phosphorous, Smoke/Obscurants Rock Island (IL) Large Caliber Cartridge Case Kansas AAP (KS) Sensor Fused Weapons Lone Star AAP (TX) Assemble & Pack Relays, Delays, Detonators for Artillery Crane AAP (IN) Load, Assemble & Pack 5” & 76mm, Illumination Candles, Pyrotechnics, Flares. Mississippi AAP (MS) ARMS Tenants Riverbank AAP (CA) Steel Cartridge Cases, 5 in. Naval Guns
Table 3-2: DAIB GOCO Plants and Core Processes (Zimmerman 2010)
There were many more famous and aged facilities in the DAIB, many of which the
DOD is finally in the process of modernizing. By contrast, sophisticated armament like aircraft, submarines and aircraft carriers are made by private companies. The government does not own a single aircraft company, since most of these were private companies prior to WWII and are not relics of the first World War or earlier. So DAIB facilities are in dire need of these upgrades; however, due to their age they are not entirely up to modern building standards and the DOD’s Uniform Facilities Criteria (UFC), which is a joint design guidance document primarily developed against terrorism.
Bringing aging systems up to modern manufacturing standards is a move in the right direction; however, most of the aging systems in the current DAIB have not been addressed or updated in years, over 70 years in some cases as is the case with Holston
Army Ammunition Plant (Gray 2011). And while these efforts may address inefficiency
29 they do not address the issues identified in this research. RAND’s Arroyo Center determined that the age of the DAIB facilities makes them inefficient and expensive to operate (Hix et al. 2003) so relocating them and bringing them up to modern manufacturing standards is a step in the right direction, if only for the short term.
3.2 A Brief History of Strategic Disruptions
It will be shown below that repeatedly and throughout history, any resourceful adversary with rudimentary capabilities can target primary systems, as well as any ancillary component of a supply chain or logistical process, as a means of reducing military capabilities. A short review of several strategies to disrupt the ancillary parts of a complex military supply chain shows that adversaries were brought to their knees by indirect attacks to their industrial base and the outcome of major wars were influenced by these actions. Any student of history familiar with the partisans of WWII, the Bedouins of T.E. Lawrence’s fame and modern Special Operations tactics and doctrine would attest to this. Lawrence’s use of guerilla tactics and avoidance of direct confrontation with the
Turkish Army, through his hit and run raids on their supply columns and rail lines in remote areas of the Arabian Desert, contributed to the defeat of the Turks in the Middle
East (Wilson 2006). Understanding the interdependence of all components on the DAIB demonstrates how disruption of one element of the DAIB affects all components of the
DOD.
During the Civil War, supply chain disruptions often targeted transportation routes.
Sherman, on his march through the south, crippled the Confederate war effort through the destruction of southern railroad lines and some storage depots, which severely affected supply trains bound for the Army of Northern Virginia. This tactic was less risky than
30 direct confrontation with the enemy both in effort and resources, and it also precluded the need to enter hostile population centers to destroy manufacturing facilities. These tactics, among others, ultimately led to the defeat of General Lee’s armies.
Similarly, during WWII destruction of less prominent elements of the enemy’s supply chain proved to be a successful allied tactic for crippling the German war machine. The ball bearing factories of Germany and the petroleum facilities at Ploesti, are two well- known examples of facilities which may not readily be associated with defense capabilities, but were specific capabilities being targeted to incapacitate the German war machine. Ploesti had long been a major source of European petroleum production, and at the time of the raid by the U.S. Army Air Corps, was producing approximately 35% of the Axis Powers’ fuel, which was the primary reason for its targeting by the Allied forces. The raid was minimally successful and consequently did not have a significant impact on Axis fuel supplies. Had these facilities been effectively destroyed everything that used an internal combustion engine that supported the German war effort would have been affected. On the other hand, the ball bearing factories in Schweinfurt endured effective heavy aerial bombardment by the Allies during WWII, which resulted in
German aircraft, tank and motor vehicle production and mobility being severely affected.
After only one raid on the ball bearing factories in Schweinfurt, aircraft production alone fell by 34% (Coffey 1977). Destruction of this one commodity relieved the Allies from destroying myriad aircraft, tank and truck factories, which would have required much more resources in the form of aircraft and trained bomber crews.
The Japanese held to a similar strategy in their attack on U.S. facilities at Pearl
Harbor. The premise was that if the attack was successful it “…would necessitate the
31 building of an entirely new fleet of warships and auxiliary craft…” (Kane 2001). The
Japanese assumed this would delay America’s entrance into the war and thus allow them unhindered operational successes in the Pacific. Fortunately, America had more than one fleet at its disposal, as well as the capability in raw materials and manufacturing prowess
(at that time in history) to turn that assumption against the Japanese Empire. It was later determined that if the attack had been on the fuel reserves in Hawaii instead of the fleet, the effect on America’s ability to carry out combat operations in the Pacific would have been much more devastating (Gailey 1997).
This depth of raw material access and manufacturing skill is not necessarily prevalent in today’s DIB because of the consolidations and ‘drawdowns’ of the 1990’s, discussed later, where significant reductions have caused large contractions in capabilities. In addition to contraction of capabilities, DIB consolidation efforts have inadvertently resulted in the manufacturing facilities of the DAIB being clustered around the Eastern
U.S., (see Figure 1-1), which presents its own set of problems that will be discussed later as the main focus of this paper.
3.3 Decline and Consolidation
In the early 1990’s, as the Iron Curtain came down, the general feeling was that the
United States had won the Cold War and there was no longer a threat from the Soviet
Union. Therefore the President and Secretary of Defense chose to consolidate defense capabilities in an effort to reap a peace dividend. The Deputy Secretary of Defense
(DEPSECDEF) at the time embarked on a policy encouraging consolidation of defense industries (Deutch 2001). This severely downsized the DAIB; government owned and operated facilities, called GOGO’s were reduced by 50% and those facilities owned by
32 the government but operated by contractors (GOCOs) were reduced by 77% (Beasley, et al. 2010). Consolidation of defense industries impacted the capabilities in a number of critical areas. It not only acted to reduce competition by cutting the number of suppliers for particular systems, but also limited innovation. When competition is prevalent, there is more incentive for companies to produce better components or arrive at more novel approaches for manufacturing these components. Composite materials, lightweight alloys and advanced electronics are only a few such examples. Decreased innovation subsequently slowed or stopped the integration of fresh technologies into new weapons systems to meet emerging defense requirements. It further reduced the number of DIB manufacturers for military systems, which by 1999 had consolidated large commercial defense firms considerably, and employee numbers were almost halved (Markusen 1999).
The general decline in DOD owned and operated facilities since the end of WWII, as depicted in Figure 3-1, shows large drops being coincidental with the ends of recent hostilities. This can be seen occurring after Korea, Vietnam and Desert Storm, and projected after large scale operations in Iraq and Afghanistan had ceased.
Figure 3-1: Overall Decline of the Army’s Organic Facilities over the Last 60 Years (Zimmerman 2010)
A similar consolidation occurred in Europe after the Cold War, which resulted in creating two major players in the European aerospace industry, European Aeronautic
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Defense & Space company (EADS) and British Aerospace (BAe) which together now account for 70% of the prime contractor defense business in Europe (Sullivan 2002). The combat aircraft currently in use by most of the European Union were produced by these companies well over 30 years ago and are still in use today with no modern variants expected in the near future. By contrast, the United States has fielded several modern stealth aircraft in the past 30 years, examples of which are the Rockwell B-1, Northrop
Grumman B-2, Lockheed F-117, Lockheed Martin F-22 and F-35. While this list is short compared to the heyday of the military aviation industry during and after WWII, it is a much longer list that those produced by the two major aircraft producers of Europe. This is important because technology is evolving and adversaries are either copying or matching weapons technologies. Being in the position as the only superpower remaining after the Cold War, with constant threats from emerging powers like China, Pakistan and
North Korea against the U.S. directly (or one of its regional allies) makes it increasingly important that weapons capabilities keep up with the growing threat.
In addition to the reduction in contractor providers, reports show that the sources of supplies and services provided to support the U.S. DOD mission may be shifting to non-
U.S. based companies. This may contradict some U.S. laws and would put many defense capabilities out of U.S. control. Another indicator of this shift is that European defense firms operating in the U.S. show that total U.S-generated revenues in the past decade have raised significantly when compared to U.S. firms operating in Europe (Bialos et al.
2009). During the drawdowns of the 1990’s, there was still a concern by the DOD of this shift to non U.S concerns and for the integrity of an endemic industrial base and its importance to national and international security postures (Kaminski 1996).
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The loss of revenue for U.S. based companies, the creation of monopolies (many of which are overseas and not subject to U.S. policy) and the stifling of innovation in support of future defense weapon systems requirements established a dangerous historic precedent. With a significantly reduced number of American owned DIB participants, the
U.S. was expanding its dependence on foreign corporations and giving them unprecedented control over defense infrastructure. A common argument used to decry
U.S. dependence on foreign oil is its threat to our national security; dependence on exclusive, foreign companies supplying critical components of the DAIB is precisely the same problem.
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“Strengthen security and resilience at home” –National Security Strategy 2010
Chapter 4 – Analysis of Current Threats
The National Defense Strategy (NDS) is issued by the Secretary of Defense in response to the National Security Strategy (NSS). It provides guidance from the SECDEF to the Chairman of the Joint Chiefs of Staff in developing the National Military Strategy
(NMS) and also provides a foundation for the Quadrennial Defense Review (QDR). The
National Defense Strategy (NDS) and the QDR are strategic guidance provided by the
SECDEF regarding missions considered to be a priority to the Secretary as well as his strategic goals. These goals are then used to generate performance measures by strategic planners in the DOD. The QDR also functions as the DOD’s strategic plan for subsequent years. One of the first things mentioned in the National Security Strategy (NSS) for 2010 was to strengthen security and resilience at home; however, the current National Defense
Strategy (NDS) issued by the SECDEF using the NSS as a guide does not adequately address homeland security.
The NDS recognizes four primary security challenges for the future: “traditional, irregular, catastrophic, and disruptive” (Daggett 2010). Traditional (conventional) operations conducted within a state-on-state framework will continue to be relevant in the future as most countries of the world invest considerable parts of their annual budgets into conventional forces (Daggett 2010). Irregular (unconventional) warfare may be conducted as the principle choice of adversaries who are “overmatched in size or military technologies” (Daggett 2010). This is evident by the crises in many parts of the developing world during the second decade of the millennium, where control of governments switches regularly and with the advent of stateless adversaries as manifested
36 by such groups as the Taliban, Boko-Haram, Al-Qaida and its many affiliates around the world. Catastrophic challenges include the “acquisition, possession, and use of weapons of mass destruction” (Daggett 2010). And while these are primarily the purview of those states with large conventional scientific capabilities (since the development of most weapons of mass destruction require a large funding mechanism and technological sophistication), the threat of nuclear, chemical or other weapons of mass destruction getting into the hands of non-state actors is not unrealistic. Disruptive challenges, as described in the NDS, are those that may occur through the employment of
“breakthrough technologies to negate existing U.S. advantages in key operational domains” (Daggett 2010). This addresses only one aspect of disruption, a superior technology being used in order to disrupt the effects of existing weapons.
What the NDS does not appear to adequately address are disruptions of supply chains or loss of manufacturing capability as key security challenges. Is this a serious oversight and what needs to be done to prepare for these challenges as they affect Defense Critical
Infrastructure? The NDS also indicates that these disruptive challenges must be accounted for in the modern and future Defense Critical Infrastructure. This type of vulnerability might include the denial of “materiel, equipment, or qualified personnel through the manipulation of markets, manufacturing capability and capacity, labor organizations, and the political environment” (Daggett 2010).
For the purposes of this discussion, the analysis of the current external threats to the
DAIB will be focused on unpredictable threats with the severest consequences that are not adequately covered by the NDS. If threat prediction in any given location is not reliable, then the prudent thing to do is to choose the least vulnerable locations for one’s
37 facilities, thus minimizing risk. Based on historical data, and simulations that have been developed using this data currently in use by the national weather services of the United
States as well as other developed nations, some relatively accurate predictions can be made on the probability that certain threats exist (Glahn et al. 1972). This is done consistently in the natural hazard arena with tornado and hurricane predictions, and helps to make risk determination much more than just guesswork; as shown later, application to the terrorist threat arena demonstrates less accuracy (Clauset et al. 2010).
4.1 Risk Assessment
The risks associated with supply chain disruptions are many; they range from interdiction by terrorists, destructive natural disasters and policy changes affecting business practices, to microbes causing diseases and illnesses in plants, animals or humans involved in the supply chain.
Risk is generally described as follows:
(4.1)
Where the risk (R), is a result of the products of the threat (T), vulnerability (V) and consequence (C). In an ideal situation, the system risk would be zero; however, there is no cost effective way to control all of the variables involved, so a reduction in risk is the best scenario that can be expected. As will be described later, the threat is very real and relevant, regardless of the mechanism, natural or man-made, and therefore cannot be entirely discounted. However, threats can be mitigated by better intelligence in the case of interdiction, and better location of facilities since naturally occurring forces are very unpredictable and can be very destructive. In addition, due to the nature of the single points of failures described in this dissertation the consequences (C) of losing any part of
38 the DAIB could be catastrophic for the United States military, because of the lack of a redundant of backup system. Therefore, consequence cannot be discounted as negligible.
Consequently, the one variable that can be controlled to reduce the overall risk is the vulnerability, that is, the likelihood that a disruptive force to the system can be successful. Methods for reducing vulnerability are addressed later in this dissertation.
However, it is very difficult, if not impossible, to harden each facility for every possible threat, which leads us to the question as to what threats should be considered by policy makers, or how many possible modes of disruption must be addressed in order to be qualified as having “…addressed risks…” (Hager et al. 1996)? Because of the unpredictable nature of natural and man-made hazards, as well as the single point of failure aspects of the DAIB, even a small probability in threat or vulnerability results in a large risk because the consequences to the current DAIB will always be severe.
Therefore, a comprehensive consideration of natural hazard risks to the DAIB as a primary mode of disruption is an important but often overlooked part of this analysis.
This discussion will concentrate on security risks, which Manuj and Mentzer define as “…the distribution of outcomes related to adverse events that threaten human resources, operation integrity, and information systems; and may lead to outcomes such as … vandalism, crime, and sabotage” (Manuj et al. 2008). These authors also indicated that operational risk, which is of primary importance in this research, is generally relegated to the corporate risk or finance departments as they are the ones that handle the insurance policy. This is fine for a non-critical facility but not acceptable for a SPOF that is of national importance. This observation alludes to the problem presently facing the
DOD and all military systems, from ammunition to aircraft, where any disruption of even
39 one of the multitude of subcontractors working on a given system causes ripple effects throughout the entire project. With consequent slips in schedules, cost overruns and other issues that affect the final outcome of the system, reviewing security threats with an eye for reducing the vulnerabilities of each link in the supply chain is crucial to success.
Since the sources of supplies to the DAIB are from disparate and far ranging locations, and many are not under the control of U.S. or allied entities, one way to reduce systemic risk is to mitigate vulnerability to a level that is practical and cost effective. And the primary parts of the supply chain that are in direct control of the government are the manufacturing facilities themselves.
4.2 Interdiction by Terrorist
The RAND Corporation, in a study done for the Department of Homeland Security
(DHS) found that future terrorist attacks are central to security efforts to protect the nation. However, should threats that have a greater chance of success be considered more important than those that have a larger effect on the population, or even those that instill more fear in the general public? What emerging threats should national policy makers dedicate more of their efforts and resources to counteract? “Should they attempt to defend against all of them, thus producing a constant strain on security resources and potentially disrupting current security efforts aimed at addressing proven threats?”
(Jackson et al. 2009). They go on to say that it would be difficult to justify the effort and expenditures in security measures to safeguard against some novel threats whose chances of occurring are miniscule. In addition, an FBI intelligence official stated in testimony to the United States Senate that “We sometimes focus on tactics that may be exotic and esoteric…but for most terrorists, they’re looking for what works.” (Van Duyn 2009).
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This gives some indication as to where the major effort should be placed to mitigate risks to the DAIB.
The director of the RAND Center for Global Risk and Security states that “The probability of being killed by a terrorist is almost zero” (Treverton 2009) other experts agree that excessive alarm toward these types of threats may be unwarranted (Mueller et al. 2011). Terrorism is no doubt a threat, but it must be realized that it is not as significant a threat as was the menace posed by Soviet communism or Nazism, and while it must be adequately addressed it still does not warrant the exorbitant expenditures it currently enjoys (Leffler 2011). The bulk of the funding for homeland security, as well as national defense and security is spent on combating terrorism, almost to the exclusion of all else.
Between 2001 and 2005 the federal government increased its spending on first responders by over 500%, and overall spending on homeland defense that same year was estimated to be the amount the Chinese expended on defense spending (Friedman 2005). These expenditures have been astounding with no corresponding ascent in security, which has led many to question if these high costs of countering terrorism are worth the relatively low reduction in the probability of attack, which is already considered to be low
(Kunreuther 2002).
There had not been a significant number of facility infrastructure interdictions by international terrorists since the 1993 bombing of the World Trade Center (the Oklahoma
City bombing was a domestic event) until the events of 2001 and no other successful domestic attack has occurred since then (Brown et al. 2006). This is not to say there have not been attempts or that relatively smaller incidents like the Boston bombings of 2013 had not occurred. Incidentally, a good case highlighting this disparity in coverage is that
41 the Boston event garnered much more media attention than a concurrent plant explosion in Texas that had a significantly larger number of fatalities!
This low incidence of attacks happened even though Al Qaeda had access to open sources for infrastructure data, which is a common practice in an open society like
America, in order to conduct target selection and assessment. This information for the most part was readily available from online searches, county and other government repositories, and would not have aroused much suspicion when or if it was accessed. And yet it was not effectively exploited by these determined adversaries!
The Centers for Disease Control (CDC) estimates that the average American has a
1:88,000 chance of dying from a terrorist attack; that same person is 8 times more likely to fall off a ladder and die, and has a 15 times greater chance of dying in an automobile accident (Friedman 2005). So naturally there are more risks involved in one’s daily life than with a terrorist attack. John Mueller of the Cato Institute contends that even if the terrorists were able to carry off a 9/11 style attack every three months for 5 years the chances of an American being killed in such an attack would still be 0.02% (Mueller et al. 2006).
Since the events related to terrorist disruptions are generally random, a stochastic approach is appropriate to determine the systemic risk (Stewart 2008). The probability of a deliberate attack against the United States succeeding again as shown is very low; therefore, the risk may be described in general terms as follows:
( ) (4.2)
Where (R) is the system risk for a specific infrastructure asset, ( ) is the probability of attack (which is relatively low in the case of terrorist attacks as previously described),
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( ) is the probability of success of the attacker and can be used as such, based on the capabilities and history of successful attacks of one’s adversary. Or, conversely, as one minus the probability of failure ( which may be indicated by the lack of maturity and capability of one’s adversaries (which is used here based on the ineffectiveness of most attacks). And finally, (C) is the consequences of the attack. If the probability of attack is low, i.e. the facilities are remote, are well-guarded or generally unknown for instance, this reduces the likelihood of terrorist success, thus effectively lowering the risk, even though the DAIB facilities in their current configuration will have high consequences in the event of a disruption. Moreover, if there is a redundant capability in the system, as previously described, this also lowers the risk since the consequence is lowered by having a backup. In addition, our law enforcement and counter terrorist efforts since 2001 have improved significantly, where potential attacks are thwarted before terrorists have a chance to execute and succeed. However, the consequences of such interdiction, in light of the SPOF nature of the DAIB still remains high, i.e. the loss of the only existing capabilities as they stand today. Therefore, having a single system for producing munitions is a very large gamble.
The fixation on man-made interdiction or deliberate threats to our infrastructure is similarly reflected in our national obsession with cyber-attacks and security. The Center for Strategic and International Studies (CSIS) found that vulnerable communications networks used in the national infrastructure does not necessarily mean the infrastructure itself is vulnerable. Furthermore, the current concerns in security circles aimed at many
Supervisory Control and Data Acquisition networks (SCADA), which are used to run many of our utility infrastructures, is largely unfounded. The U.S. power grid is run by
43 over 3,000 different providers using multiple systems, relying on varying operating systems and hardware configurations. A potential adversary would have to interdict a large number of these providers to have a significant effect, and even so this would generally be restricted to particular regions.
Although viruses and other malware are everyday occurrences, they generally go unnoticed by the masses, thus causing little or no effect to everyday lives (Lewis 2011).
Recent noteworthy news events about defense contractors, as well as DOD IT systems being hacked have made sensational news, but the consequences of these attacks seem to be minimal. The current national preoccupation with potential terrorist attacks is understandable, but the expert consensus is that the exorbitant spending is unwarranted
(Friedman 2005). The terrorist threat appears to be small compared to the attention it garners. Therefore, our limited resources should be more prudently used elsewhere.
4.3 Earthquakes
The most significant threat to the current DAIB is the New Madrid fault, which is located in a five state area generally following the Mississippi river from Illinois, extending about
120 miles southward into Missouri, Arkansas and across the river into Kentucky and
Tennessee, and is centered on the locations of the current ammunition DIB. The prevalence of earthquakes in the western parts of the United States is known to even the
most casual of observers. However, it is a lesser known fact that the middle to eastern
areas of the U.S. where the preponderance of the DAIB is located is also prone to these
damaging earth movements. The probability of the DAIB facilities being affected by catastrophic earthquakes is very significant; Figure 4-1 shows a graphical depiction of the areas of concern, which are of utmost significance with regard to current DIAB locations.
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This shows the New Madrid fault, located south of the Illinois border along the
Mississippi river. This, in conjunction with the ground accelerations depicted in Figure 4-
2 for the last earthquake generated by this fault shows that the majority of the DAIB will
be affected if there is another occurrence. In August 2011, an earthquake of magnitude
5.8 centered around Mineral, Virginia, which is about one hundred miles from the
Nation’s capital, was significant enough to cause severe damage to the Washington monument and many other infrastructure facilities in the mid-Atlantic area. This caused the nuclear power-plant at Lake Anna, located a few miles from the epicenter, to be shut down for an extended period of time for inspections to containment facilities and reactor buildings because of the violence of the event; this demonstrates that even well-designed
facilities can still be adversely affected by even a relatively small earthquake.
Figure 4-1: Areas of Highest Earthquake Activity or Probability (USGS 2011)
In addition, earthquakes in the eastern parts of the U.S. can be felt over areas 10 times larger than those felt in the west, and can cause damage farther away from the epicenter than similar activity in the western U.S. (USGS 2011). This is due primarily to the local
45 geology, which causes different ground accelerations for a given magnitude on the
Richter scale. Ground accelerations are a better tool than just the magnitude to understand the ground shaking possible for a given Richter number adjusted for ground composition and wave amplification. Ground acceleration incorporates the soil composition and thus the earthquake’s wave propagation through the soil over given distances. Therefore, an earthquake on the east coast will be far more destructive than one of similar magnitude on the west coast (Stover et al. 1993) since the rocky composition of the eastern United
States is much denser than the sandy clay composition in the west. So a magnitude change of just ‘one’, carries a corresponding increase in amplitude, or ground displacement, of ten, which results in a corresponding increase in energy of thirty–two times. The modified Mercalli scale, whose number representations are depicted in Figure
4-2 and Table 4-1, shows the ground acceleration and other related information relating to the New Madrid earthquake. These were created specifically for this event by researchers at the USGS.
Perceived Not felt Weak Light Moderate Strong Very Severe Violent Extreme Shaking Strong
Potential None None None Very Light Moderate Mod/ Heavy Very Damage Light Heavy Heavy Peak Acc <0.007 0.08 1.0 5 8.8 15 27 47 >83 (%g)
Peak Vel <0.003 0.04 0.5 3.0 6.5 14 30 63 >136 (cm/s)
Instrumental I II-III IV V VI VII VIII IX X+ Intensity
Table 4-1: USGS Shake Map: New Madrid (USGS 2013)
The U.S. Geological Survey (USGS), based on research conducted in the 1990’s, predict that the New Madrid fault is capable of producing significantly more destructive earthquakes than those experienced in the area so far. Based on this, researchers at the
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University of Memphis, the USGS and the Center for Earthquake Research estimate that the probability of a repeat of the 1811-1812 earthquakes, which were of magnitude 7.5 to
8.0 is 7-10%, and the probability of a magnitude 6 or larger is an astronomical 25-40%
(Gomberg et al. 2002). The last major earthquake attributed to this fault was in 1996 and was measured at 4.3 on the Richter scale and produced some localized damage. However, the fault is very active and averages 200 tremors annually ranging from 2.5 to 3, with at least one over 4.0 every 18 months (Missouri 2012). The New Madrid fault had its last significant event in 1811 and it ranked among the largest in the U.S. since the appearance of Europeans here in the 17th century. The area of strong shaking occurred over areas 3 times larger than the 1964 Alaska earthquake and 10 times larger than the 1906 San
Francisco earthquake, with predictions for similar future occurrences (USGS 2011). This is an indication that the next ‘big one’ will be significant and very destructive.
Reports of the 1811 New Madrid earthquake indicated that “…entire Islands disappeared…” (USGS 2011) in the Mississippi, landslides occurred over a …”120,000 square kilometer area…” and “…log cabins were thrown down as far as Cincinnati,
Ohio…” (USGS 2011). These numbers are significant when compared to the projected felt energy attributed to the 1811-1812 earthquakes shown in Figure 4-2.
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Figure 4-2: Isoseismic Representation (in %g) or Ground Acceleration (Stover et al.1993)
This is an isoseismic graph of what the 1811 earthquake felt like at the various distances from the epicenter. It shows quite graphically that if or when this reoccurs, the current locations of the DAIB will be severely affected and the possibility of catastrophic
48 disruptions becomes apparent. If this happens to occur when the DOD is engaged in a two theater war as occurred between 2001 and 2012, then the resulting disruptions would be disastrous for those American combatants dependent on the DAIB.
4.4 Hurricanes
Hurricanes have massive destructive potential to parts of the DAIB, especially those located in the southernmost areas of the country. The National Oceanographic and
Atmospheric Administration’s (NOAA) National Hurricane Center (NHC) in Miami published a study in 2011 which listed 166 hurricanes passing through the area of concern of this study between 1851 and 2010. And during this same period there were eleven H-5, twenty-two H-4 and twenty H-3 hurricanes observed in the area of concern
(Blake et al. 2011). The Saffir-Simpson scale, shown in Table 4-1 is used to classify hurricanes by wind speed, where ‘intense’ hurricanes are considered to be those of H-3 or higher.
Table 4-2: Saffir-Simpson Hurricane Classification Scale (Blake et al. 2011)
This is because they contain destructive winds in excess of 110 miles per hour
(MPH), which is destructive to structures not built to accommodate such phenomena. In addition, the debris generated by this destruction becomes so many missiles that are
49 hazards to other structures and humans as well. This should be noted when considering the age and condition of most of the current DAIB facilities.
The exact tracks of these destructive phenomena may be modeled on the NOAA
NHC site at http://csc.noaa.gov/hurricanes/, which is considered the preeminent authority on hurricanes in the United States and has conducted extensive research on this topic.
Hurricanes cause direct damage to facilities from wind and rain, with indirect damage from subsequent flooding and storm surge in coastal and inland waterways, as was the case with Katrina in 2005 and Sandy in 2012. The area in this study has several large inland waterways that are prone to flooding, including the Mississippi, Ohio, Missouri,
Monongahela Rivers and other large bodies of water. Figure 4-3 depicts the paths of 30 of the most destructive hurricanes that occurred in the United States between 1964-1995.
These are Category 3 (CAT III) and higher hurricanes, with destructive winds of 111-130
MPH based on the Saffir–Simpson Hurricane Wind Scale, as well as damaging rains and flying projectiles.
Research and the current debate on global warming indicate that the occurrences of hurricanes, or tropical cyclones as they are often referred to in professional circles, are going to increase significantly. Researchers at Colorado State University, in conjunction with NOAA and using their historical data, have done extensive research to deliver a model that can approximate the likelihood of future storms. Their analysis of the NOAA data for the last 100 years showed that the expected probability of landfall for tropical cyclones conformed to a Poisson distribution described as follows (Gray et al. 2004):
(4.3)
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Where EP is the expected probability of landfall, (p) is the annual average number of tropical cyclones that have occurred in the past 100 years and (x) is the number of storms expected in the upcoming year. This provides another tool to the decision-maker to adapt and use for predictions for their specific location using historical data.
The effects of hurricane Katrina, the deadliest event of 2005, were still being addressed six years after it had pushed through New Orleans. It is this long-reaching impact of hurricanes that should be a red flag in DAIB threat assessment, as parts of the larger DIB, which support the space agencies and the Air Force, were significantly affected by Katrina. The majority of facilities in the DAIB, shown in Figure 4-3, are in the direct track of most of these severe storms. Weather and climatic patterns are cyclic, and it may only be a matter of time before a direct hit is realized on some part of the
DAIB and the consequences of a natural disaster disruption are realized.
In the aftermath of hurricane Katrina, energy and chemical manufacturers along the coast of the Gulf of Mexico spent nearly two years repairing infrastructure damage
(Teague 2007). At a time when the DOD was engaged in two theaters of operation and had to support several hundred thousand troops and civilian support personnel with beans, bullets, fuel, and the other necessities of fighting two wars, waiting two years to restore a disrupted capability would have had a major impact on the DOD mission.
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Figure 4-3: Top 30 U.S. Damaging Hurricane Tracks, 1964-1995 (NOAA 2010)
4.5 Tornadoes
Other significant threats to the DAIB are tornadoes. National Oceanographic and
Atmospheric Administration’s (NOAA) records show that the areas with the most occurrences of tornadoes (see Figure 4-4) are coincidental with the location of the majority of the DAIB. Tornadoes are very destructive forces that are generally associated with the Midwestern U.S. in an area called Tornado Alley, but the previously described and lesser known area in the Eastern U.S. also has a nickname based on tornado activity,
Dixie Alley. As mentioned the boundaries are somewhat nebulous but consist of the area along the Mississippi valley bounded Alabama, Tennessee, Arkansas, Mississippi and
Louisiana. Tornado Alley is an area in the southern plains of the central U.S. that
52 consistently experiences a high frequency of tornadoes each year. Tornadoes in this region typically happen in late spring and occasionally the early fall. In Dixie Alley there is a relatively high frequency of tornadoes occurring in the late fall (October through
December). Although the boundaries of Tornado Alley are debatable, the general consensus by national weather professionals is the region from central Texas, northward to northern Iowa, and from central Kansas and Nebraska east to western Ohio, depending on which criteria is used - frequency, intensity, or events per unit area. The Enhanced
Fujita Scale is used to classify the severity of tornadoes by wind speed, depicted in Table
4-3.
EF Number 3 Second Gust (mph)
0 65-85
1 86-110
2 111-135
3 136-165
4 166-200
5 Over 200
Table 4-3: The Enhanced Fujita Scale (Texas Tech University 2004)
The Enhanced Fujita scale is still a set of wind estimates (not measurements) based on damage. This is a modified version of the one proposed by Fujita in 1999, and was developed at Texas Technical University for NOAA, which is used by present day meteorologists to classify tornadoes based on a combination of their wind speeds and destructive energy.
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Figure 4-4: Annual Average Number of U.S. Tornadoes, 1991-2010 (NOAA, 2010)
An analysis of NOAA data compiled in 2010 shows that strong to violent tornadoes
(those categorized EF-3 or stronger using the Enhanced Fujita Tornado Damage Intensity
Scale), are relatively rare, and do not typically occur outside the United States.
Meteorologically, the region known as Tornado Alley is ideally situated for the formation of super-cell thunderstorms, often the producers of violent (EF-2 or greater) tornadoes
(NOAA 2010).
Overall, most tornadoes (around 77 percent) in the U.S. are considered weak (EF-0 or
EF-1) and about 95 percent of all U.S. tornadoes are below EF-3 intensity. The remaining small percentage of tornadoes are categorized as violent (EF-3 and above). Of these
54 violent twisters, only a few (0.1 percent of all tornadoes) achieve EF-5 status, with estimated winds over 200 mph and nearly complete destruction (NOAA 2010). However, given that on average over 1000 tornadoes hit the U.S. each year, twenty can be expected to be violent and possibly one might be incredible (EF-5) (NOAA 2010). Figure 4-4 shows the average number of tornadoes annually by state, around the United States for the 20 year period between 1991 and 2010.
Figure 4-5: Annual Average Severe Tornado Events, 1991-2010 (NOAA, 2010)
It should be noted that the number of tornadoes in the aforementioned Dixie Alley is significant, and second only to the area designated as Tornado Alley. The area along the
Mississippi valley from southern Illinois, south to Louisiana and Alabama has a significant number of tornadoes when compared with areas in the western and
55 northeastern United States. The occurrences of severe tornadoes, designated as those rated EF-3 to EF-5 as shown in Figure 4-5, again displays a similar pattern. These indicate that the destructive tornadoes are more prevalent in the eastern lower Midwest, which is precisely where the majority of the DAIB is located.
In order to account for the varying state sizes these numbers are based on occurrences per 10,000 square miles and not just by state. Since there is no real tornado season according to the National Climatic Data Center (NCDC), they can occur at any time; there is just an increased potential for tornado activity during specific times of the year
(Hamid et al. 2013). It should be noted that states with the highest occurrences of these most destructive phenomena are also the ones that contain facilities of the DAIB.
Virginia, where there are only a few DAIB facilities, experiences 0.3 severe tornadoes on average per year, whereas the highest percentage of severe tornadoes, with the exception of AR, happen to be in states where many DAIB facilities exist, such as KS with 3.1, TX-
2.8, MS-2.0, TN-2.7 and IA-2.2. This concentration of frequent severe weather can be seen in Figure 4-5, which coincides with the locations of DAIB facilities.
The path of the largest ever recorded tornado activity in the U.S., in terms of area affected, is shown in Figure 4-6. These are generally characterized as ‘super outbreaks’ because of the large area affected and the numbers of tornadoes spawned in the event.
This 1925 event affected areas in southern Illinois, southeast Missouri and southwest
Indiana; again, locations where SPOF facilities of the DAIB are located. Entire towns were demolished, and hundreds of citizens were killed as this F-5 event unfolded for 3.5 hours over a 219 mile path, with winds that were in excess of 300 mph.
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Figure 4-6: Largest Recorded Tornado Event (NOAA 2004) A similar ‘super outbreak’ which occurred again in 1974 is depicted in Figure 4-7.
This incident spawned 148 tornadoes, 30 of which were EF-4 to EF-5 intensity. Again the areas affected are where DAIB facilities are located, including Illinois and Indiana.
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Figure 4-7: Super Outbreak of 1974 - 148 tornadoes, with 30 being EF4-EF5 (NOAA 2004)
Furthermore, Figure 4-8 shows a more recent super outbreak phenomenon that occurred in February 2008. This contained ten of the most destructive tornadoes in U.S. history, and affected the areas of IN, IL, MS, MO, AL, OK, TN and TX. These examples all speak to a pattern of destructive phenomena in the area that houses our only facilities for munitions production.
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Figure 4-8: 2008 Super Tuesday Outbreak (NOAA, Storm Prediction Center 2004)
Very few structures are constructed to withstand the type of forces generated by these events, so a direct hit on any of the DIB facilities in the path of a similar event would surely render the facility inoperable. Even if these facilities did not sustain significant damage the chance that their employees would be affected is very high. Today’s technology ensures early warning for evacuation and the reduction of human casualties; however, structures are left at the mercy of these destructive phenomena.
4.6 Disease, Illness and Natural Disasters
If terrorist interdiction is not as significant a security risk to the DAIB as generally assumed, what other factors are being overlooked in the National Defense Strategy?
During the 2008 Avian and Swine flu scares in Asia, many companies were subjected to disruptions because governments placed strict access controls on their suppliers and their employees in Asia as well as on exports, causing delays in shipping and consequent
59 disruptions downstream in the supply chains of many products. Similarly, catastrophic events like hurricanes, tornadoes, earthquakes and bomb blasts can severely damage facilities to the point where employee access is severely hampered, critical machinery or equipment is destroyed, or the entire facility is flattened. These facilities often have high initial capital costs and take considerable time to reconstitute. And even if the facilities themselves do not sustain severe damage the often skilled workforce they employ surely may be. Whether the loss of facility or workforce, both affect the facility with what may be a large disruption.
Other examples of the ripple effect of disease and natural disaster on supply chains abound. The massive destruction and radiation contamination that occurred in the aftermath of the tragic earthquake and tsunami in Japan in 2011 had an impact around the world. Plants producing parts for several car makers were shut down to allow workers to care for their families as well as to address the concerns over radiation contamination.
The closing of facilities in Japan affected Suzuki, Honda, Mitsubishi, Toyota, Nissan and other manufacturers’ plants around the globe (Kachi et al. 2011). While this was only a temporary situation and the threat to America’s national security was minimal in this particular case, if the manufacturers in a similar supply chain for parts for systems like the MRAP, F-16, or B-2 tires, all of which are currently in use in the Gulf War, had been involved, then the impact of the earthquake/tsunami event on U.S. military concerns would have been significantly different. The same holds true for the DAIB if one component, say the supply of nitrogen for explosives or copper for shell casings, were disrupted then every soldier on the battlefield will also ultimately be disrupted.
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Natural disasters generally get attention because of the human impact and media coverage of immediate consequences but seldom are cited as threats to national security.
The likelihood of one of these occurrences affecting parts of the DAIB gets very little advance scrutiny. Unlike a terrorist attack, where one’s adversary is deliberate, assesses targets and exploits their vulnerabilities, which are activities that have a high incidence of discovery by law enforcement or intelligence agencies, not so with natural disasters.
These phenomena are random in their target selection, and strike with speed and awesome destructive power.
Modern modeling capabilities have become fairly robust in the area of natural hazard predictions, but these are still only models, and have proven less than adequate on many occasions on their predictions of intensity and path of these hazards. For example, hurricane predictions often look like cooked spaghetti thrown against a wall, earthquake models are based on probability rooted in past events that are not necessarily an accurate prediction of the intensity or destructive power of future ones and tornado activity prediction is probably the least robust of all. To complicate this further, there are many different models that often seem to contradict each other.
A recent example of this was the prediction for Hurricane Ike, which ultimately hit
Louisiana and the Midwest. Hurricane Ike ended up following the European model for its path through the United States and not the U.S. model, which speaks to the unpredictability of these phenomena. Yet hurricanes are extremely destructive events and, coupled with aging or inadequate infrastructure resilience, will spell disaster for much of the DAIB should any part of it be subjected to an extreme event.
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“There are risks and costs to a program of action, but they are far less than the long-range risks and costs of comfortable inaction.” - JFK Chapter 5 – Analysis of Possible Solutions
5.1 Analysis of Possible Solutions
Potential solutions to reducing natural disaster threats to the current DAIB supply chain range from improving systems engineering and design practices within facilities to cultivating commercial off-the-shelf resources to establishing dual sourcing for critical and high demand supplies, each with its unique limitations and drawbacks.
5.2 Systems Engineering and Design
There has been much written on supply chain threats but relatively little has specifically addressed the vulnerability of the DAIB infrastructure or provided possible solutions. Every critical infrastructure system represents a very large investment in resources, and any disruption, whether random or deliberate, causes a degradation of performance as well as considerable economic costs (Brown et al. 2006).
Many authors tend to list threats in general terms and present them in threat matrices used to categorize threats to industries such as those listed by Stecke (Stecke 2009). And while this approach may be helpful in making general assumptions about how a threat may affect infrastructure, the fact that some disruptions are the result of poor systems engineering practices and may be avoided with proper planning and preparation is often ignored. In 1998, many hospitals in Houston were without power for an extended period of time after Tropical Storm Frances inundated their backup power supplies. This occurred again in June 2001 when Tropical Storm Allison caused the worst flooding in
U.S. history to date, leaving much of Houston without power, including many Intensive
Care Units (ICUs). This fiasco occurred in facilities that had allocated significant
62 resources to install backup power generator capability, but had failed to plan and properly place emergency equipment (Nates 2004). The backup generators for the Anderson
Medical Center, for example were located on the second floor, which flooded.
Interestingly enough, the environmental control systems for many of these facilities were located on their roofs, entirely out of harm’s way.
A similar disruption occurred in Louisiana after Hurricane Katrina when telecommunications backup facilities located around New Orleans became quite waterlogged and subsequently failed following the massive flooding in the area (Weaver
2009). A common sense systems engineering approach would have demanded that in areas prone to flooding, it would be advisable to locate contingencies above the typical flood levels. Telecommunications systems today are mostly wireless and very amenable to remote operations, so relocating facilities like these a few miles in the direction of higher ground or out of a flood prone area may have resulted in a significantly different outcome. Katrina has also been described by some authors as a combination of a natural and manmade disaster. The subsequent levee collapse and flooding after the meteorological event was considered a consequence of the neglect of the levee system
(Harrald 2006).
5.3 Commercial Off the Shelf
Commercial Off The Shelf (COTS) is another viable source and potential solution to supply chain disruptions for many military items, mostly those not combat essential or requiring hardening against heavy use, Electro-Magnetic Pulse (EMP) or myriad other
DOD requirements. As stated earlier in this paper, there is not much practical use for military equipment in the commercial arena, and while many pieces of equipment like the
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Jeep, military generators and heavy equipment may be practical for civilian use and are auctioned off periodically by the DOD, not so for tanks, battleships and F-16s. In the
1990’s there was a major push to reduce costs and procure more military hardware from commercial sources. The President, hoping to capitalize on the so called peace dividend realized from the end of the Cold War, announced a five year plan costing billions of dollars to encourage commercial companies to produce “…dual-use goods…” (CBO
1993) in order to lessen the impact of what was commonly known as the drawdown of the 90’s on the American worker and American manufacturers (CBO 1993). DOD has, since the end of the Cold War, been trying to move away from Military Standard (MIL-
STD) specifications towards more commercial specifications in an effort to reap the peace dividend and to use more COTS products, as was stated by the Undersecretary of
Defense for Acquisitions in a conference in Warsaw in 1996 (Kaminski 1996).
However, there are inherent problems with this approach. Military products, by the nature of their intended use in harsh environments, and for the preservation of the lives of
American service members, require high reliability. Thus, they will often require more stringent controls than those normally available commercially. The move to COTS has led to increased failure rates for military systems because COTS do not always meet these stringent standards (Kuper 2005).
The decision in the 1990’s to use performance specifications instead of the more stringent military specifications led to a decline in the reliability, maintainability and suitability of military weapons systems and has become a major problem for the U.S.
Army (Alfieri et al. 2008). This led to a large reduction in reliability in military systems
(Kujawski 2010). Kujawski contends that “The principle of reducing reliance on military
64 specifications may be sound from both business and technology standpoints… but the fielded systems failed to achieve the desired reliability” (Kujawski 2010). In the ten year period spanning 1985 to 1995, the Army’s Test and Evaluation Command Army
Evaluation Center (ATEC/AEC), showed a 59% failure rate in reliability of systems tested. After the decision was made to move to commercial specifications for weapon systems that failure rate increased to 80% of systems. This coincides with the directive issued in June 1994 by then Secretary of Defense William Perry to promulgate a memo on “Specifications and Standards – A New Way of Doing Business,” (Perry 1994) which required the use of state of the art technology whenever possible and eliminating military specifications “…to the maximum extent possible…” (Perry 1994) and authorized military specifications only as a last resort, requiring a waiver.
Some very serious issues encountered when using multiple systems from multiple commercial suppliers include: non-standard maintenance requirements, varying levels of fit and finish, spare part compatibility and non-standard performance, to name just a few.
Imagine a platoon of infantrymen engaging an enemy in battle with multiple types of commercially acquired rifles. If one soldier is injured and removed from the battlefield his rifle may routinely be used for parts for any other soldier’s damaged rifle; this practice is referred to as battlefield recovery in the military. If the rifles are from different manufacturers, however, interchangeability of parts may not be a given. This issue is quite prevalent in the aftermarket production of M-16 type rifles for civilian consumption, as well as electronics that end up in sophisticated weapons systems.
Varying levels of quality assurance, attention to detail and machine tolerance often makes it difficult to fit parts manufactured by one company into another company’s product.
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In addition, commercial manufacturers often are not required to subject their products to the levels of heat tolerance, impact, mechanical and thermal stresses that are usually required in military specifications. Failure to adhere to the strict standards of inspection and quality assurance required of Defense contractors or the potential infusion of counterfeit parts into weapon systems could also become a critical down-side of increased COTS acquisitions in a disruption solution. The Department of Commerce has cited many examples of foreign or non-military specification parts being introduced into the supply chain for defense applications because the reputations for quality manufacturing developed over the decades by defense contractors has been exploited by counterfeiters or non-defense manufacturers in order to exploit the lucrative defense market (Crawford 2010).
5.4 Stockpile (Storage)
Ammunition is generally stockpiled in peacetime and stocks are rotated and managed for training. The use of stockpiling to prepare for supply chain disruptions is another potential solution to the problems outlined in this discussion. Experiences in the past 10 years as the DOD has been engaged in two wars, however, reveal a number of issues with the ammunition supply that make stockpiling an ineffective solution. The Strategic and
Critical Materials Stockpiling Act of 1979, established the DOD as National Defense
Stockpile Manager, and is tasked to maintain “… a stockpile of strategic and critical materials to supply the military, industrial, and essential civilian needs of the United
States for national defense…” (U.S. Congress 1992). The act was later modified to establish a Market Impact Committee (MIC) to “advise the National Defense Stockpile
Manager on the projected domestic and foreign economic effects of all acquisitions and
66 disposals of stockpiled materials” (Latiff et al. 2008). A member of this committee, after viewing the aftermath of Hurricane Katrina, commented on the ramifications of storing national defense materials in one region. Materials that were not only critical to the manufacturing of munitions, but to the steel, petrochemical, public utilities and the launching of NASA and DOD rockets were impacted as well. He recommended additional capabilities for these SPOF facilities be addressed, since the DIB is particularly vulnerable to such single-node failures, as military equipment is produced or assembled at a single facility (Erwin 2005). Therefore, a natural disaster or terrorist strike on one facility will negatively impact U.S. national security worldwide.
Stockpiling is also a poor solution because it creates strategic targets. The services have been moving away from this option since the late 1970’s, prior to which the tenet of
“come as you are with stored supplies” (until the industrial base could surge to meet requirements) has given way to a policy of replenishment (Beasley et al. 2010). During the 1991 Gulf War, military support which included “…research, development, production and storage of conventional armaments…” was considered one of seven
“…core strategic target sets…” (Davis 2002) for affecting Iraq’s military capabilities.
Thus, even U.S. tactics recognized the importance of targeting enemy storage facilities. A primary problem with stockpiling is that eventually one or more of the components of the materials in military munitions tend to deteriorate or lose effectiveness. Consequently, the stock needs to be rotated, and care needs to be taken in storage against environmental and other conditions, which the military does fairly well.
However, at the beginning of Operations Iraqi Freedom (OIF) and Enduring Freedom
(OEF) the Lexington Institute estimated that 60% of the Army’s stockpile of small arms
67 ammunition was deemed to be of less than preferred quality (Goure 2004). Had it not been for the protracted nature of our last two wars the stockpile of ammunition was predicted to be “…unserviceable or of limited utility…” by 2010 (Erwin 2003). Some other munitions don’t lend themselves readily to storage for many reasons, two of which are technology and costs. According to Naughton, a retired deputy Chief of Staff for ammunition at Army Materiel Command (AMC), the costs for a tank bullet is around
$2000, ‘smart’ munitions may coast $20,000 to $30,000 each and antitank missiles for attack helicopters are about $150,000 each. So it becomes very costly to produce and store these items for long periods of time. If an adversary develops countermeasures to these systems, then they become obsolete and one is left with ineffective scrap metal. In addition, smart munitions have sophisticated electronics and guidance systems which are susceptible to certain environmental conditions if stored improperly, but more importantly they risk obsolescence as technology and countermeasures improve.
Furthermore, some munitions, like depleted Uranium rounds are hazardous, so storing them for long periods is not only dangerous to personnel but to the environment as well.
As previously mentioned, stockpiling or maintaining an inventory may be applicable to some assets while not readily feasible for others. Almost every Army Private, at one time or another has seen munitions dated from some previous war that was being expended for training years later. Special facilities are necessary in order to store munitions and provide protection from climate and blast as well as security to prevent pilfering (Hager et al. 1996). And as an Army Operations Center (AOC) briefing on the
Quantitative War Reserve Requirements for Munitions (QWARRM) highlighted, munitions modernizations are underway because some stocks are approaching
68 obsolescence, and inventories are not necessarily tuned for ‘persistent operations’
(Grubbs 2008). Most stockpiles begin to approach obsolescence after about 20 years, and at the beginning of the Iraq war the Army was in danger of losing almost 40% of its war stock. This is not because ammunition goes bad overnight, but because after a long period of storage some of the components become unstable, making the ammunition unreliable.
A former deputy chief of staff for ammunition at the Army Materiel Command estimates that as the age of stockpiles increases, reliability and performance become more suspect and about 7-8% of the stockpile will be bad (Erwin 2003).
Stockpiles also must be secured and there have been instances in the past where issues with the security of storage facilities were identified, as well as the accuracy of inventories; one report found that some inventories were off by as much as 16% (Jones
1991). This issue is compounded by the multiple locations at which ammunition is currently stored. Army Europe alone has over 100 ammunition storage points throughout
Europe, the U.S. Navy in Europe plans to downsize from five to three storage points, the
Marine Corps uses six caves in Norway for their ammunition storage and the Air Force has 57 locations (Scott 2007). Invariably the military downsizes and the subsequent environmental issues and cleanup poses another hurdle to consider (Bearden 2006).
There are many ways to determine the associated costs of storage and even a casual review of literature would produce dozens of methods, including the production capabilities necessary to maintain certain levels of inventory (Ross 2006). However, it should be noted here that due to the unpredictable way in which military materiel is utilized, not all inventory methods may be applicable to military situations. Peacetime training cycles notwithstanding, when a military organization embarks on combat
69 operations, supplies and equipment often experience extensive use, and generally, more so than in training or peacetime operations. This applies to everything from bandages or bombs to helicopter rotor blades. In contingency operations, bullets and bandages are expended at a rapid pace, while equipment such as helicopters, which were used extensively in the recent Middle East wars, are used to transport people and materiel to remote areas or over dangerous ones. In situations like that, rotor blades, turbine engines and hydraulic fluid are a few of the items in high demand. Increased use combined with higher demand accelerates the lifecycle of most equipment and places a high demand for spares. Similarly, a review of the literature produces myriad models for predicting demand of certain items using probabilistic means as well as methods of prediction based on logistical principles utilizing production or other historical records to arrive at cost for storing supplies for unpredictable future use (Ross 2006). For contingency operations, approaching inventory with a probabilistic mindset makes sense since materiel usage would be unpredictable.
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“A good solution applied with vigor now is better than a perfect solution applied ten minutes later.” – General George Smith Patton
Chapter 6 – Conclusion
The history of the DAIB has revealed a steady decline in internal system flexibility as the result of many forces over the last several decades. Contraction of capabilities, consolidation and loss of U.S.-based suppliers, and current policy and strategic planning has fallen woefully short in addressing the entire spectrum of catastrophic threats to military supply chains. There is no doubt that a concerted effort to build resiliency within the DIB and particularly in the DAIB is in order.
Most ammunition supply chain failures experienced during the opening phases of
Operation Iraqi Freedom resulted in severe ammunition shortages and are a symptom of a much larger problem. Supply shortages like those during OIF have multiple causes and the solutions have been shown to be fairly complex, particularly in light of the uniqueness of defense items, the limited number of suppliers, the number of single points of failure in the system, the inconsistencies in quality control, and the inherent problems of buying from commercial sources. And while all these factors are important to the proper safeguarding of the DAIB supply chain, facts and examples recounted in this discussion show that the most serious risk to the operation of the DAIB has not been adequately addressed by the Defense Critical Infrastructure Program (DCIP) and lies in the current locations of facilities.
In offering a clear basis for fixing a small portion of the ammunition supply chain and providing some recommendations to mitigate risk, the author contends that each entity within the DAIB will have different risk factors and consequently differing levels of risk they are willing to accept. Once an organization within the chain has determined what its
71 threshold level of risk is, the proper steps to ameliorate severe consequences can be taken. For example, an organization that has credible information about a threat will rate those criteria more objectively than an organization that is making an ‘educated’ guess.
Similarly, the rating given to an ammunition manufacturer that produces ammunition for a specialized weapon system, say air to air missiles, should be given a lower risk than one that supplies one of the most common weapon systems in the military, the M4 carbine.
Since it is used by more services and in large quantities, it affects a larger number of users. The rationale is that the relatively few aircraft that are fitted with air to air missiles can more easily be refitted to carry bombs or another type of missile, than it is for the entire Army and USMC to be converted, in short order, to a different rifle and ammunition.
In the event of a low probability of disruption as described in this paper, and the low probability of success, the risk becomes lower but still of high consequence due to the
SPOF nature of the DAIB. However, through the application of a redundant capability that consequence is reduced by the output capacity of the redundancy.
There are no ‘silver bullets’ or obvious solutions to this issue. The DIB is enormous and complex, and while this dissertation only deals with the subset of the DAIB, the rest of the system also deserves rigorous and thorough evaluation for optimization. Because the consequences of disruptions of the DAIB can be catastrophic, the solutions that make the most sense for the threats presented and provide a modicum of resilience for safeguarding the future of the DAIB should be immediately addressed in the DCIP.
While some options may readily present as the easy solution, for the long term the author believes the best solution is the redundant capability presented here, which modernizes
72 the aging ammunition infrastructure systems while at the same time providing a backup capability against accident, or interdiction by a hostile entity.
The current locations of DAIB facilities were originally predicated on access to the major transportation hubs, mainly the extensive rail system prevalent in the United States
60 to 80 years ago, as well as the major waterways, which allowed ease of transport for large commodities used in ammunition manufacturing. There were also large stable workforces in these locations, and reasonable proximity to natural resources like coal and iron as well as the industrial complexes with which to fashion these materials into arms.
These reasons are no longer valid since the American population is very mobile and much of the migration in the United States today is to the west and south. Advances in manufacturing and automation have also negated the need for large manufacturing plants and storage facilities, where just in time (JIT) supply chains are now the norm.
More modern facilities may be located in different geographic areas such as the northern U.S. between the Rockies and the Mississippi Valley for similar reasons the
Soviets placed their heavy manufacturing behind the Urals during WWII; these areas are fairly remote and sparsely populated, natural hazards examined in this dissertation have lower probabilities of occurrence, and strangers who may pose a threat tend to ‘stand out’ in smaller communities. In addition, natural resources as well as energy production are readily available. Predictions for destructive natural hazards more common in these areas are readily available and records have been kept for long enough periods where sound risk-based decisions on locations may be made. Only with resilience can our policies for defense preparedness and continued national security be ensured.
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6.1 Dual Sources
Army General Walker was reported to have said “We can win without food, we cannot win without ammunition!”(Goure 2004). This is absolutely true, even in peacekeeping operations; ammunition is the lifeblood of the combat soldier. For example, when the Rangers and Marines went into Mogadishu on a peacekeeping/humanitarian mission, there was likely no expectation of running gun battles in the streets before their mission was over. Therefore, the acquisition and delivery of ammunition in sufficient quantities to sustain operations, whether for training or actual combat, should be of the utmost importance to military logisticians and policymakers. This should be done with minimal dependence on commercial, foreign or quasi-governmental entities, for reasons previously indicated since they may not be in the best interest of our national defense organizations or our military (Goure 2004).
Although there is a long-standing debate about the merits of dual or multi-sourcing of supplies, discussion is generally geared toward service level improvements or cost reduction, with research into the benefits of dual sourcing as risk mitigation being somewhat limited (Yu et al. 2009). From previous discussion, the optimal solution to minimizing supply chain disruptions leans heavily towards having more than one source for a system. Limited resources coupled with a limited number of customers for military systems makes it apparent that there needs to be more than one redundant producer of a system or subsystem, and they must be government owned facilities as a commercial entity cannot operate at a loss or with limited customers indefinitely without becoming defunct. These facilities must be geographically separated, so that a regional disruption does not become a systemic one.
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The necessity of geographic separation for supply chain producers can be seen in the example of an international IT company with whom the author was intimately familiar, that consolidated their data center operations from eight facilities located around the world into three (with two located in eastern Texas and a third in the southeastern U.S.).
During Hurricane Katrina all of their locations were threatened by this single environmental event. Luckily for the company, their customers, who were paying for secure data storage and management services, were unaware that their data, which they assumed was secure, could have all been wiped out in a few days. Similarly, the DAIB must have geographically separated facilities so that all capabilities are not affected by the same disruptive mechanism. A member of the MIC, after viewing the effects of
Katrina on one aspect of the DIB, commented that the value of geographically separated sources of ammunition should be obvious to everyone (Erwin 2005).
Another example from the consumer electronics arena supports the argument for a backup supplier being good corporate policy and practice. In 2000, a fire at a microchip plant in Albuquerque caused major disruptions at two of the world’s major cell phone manufacturers. Nokia was much better prepared than Ericsson in this instance, and thus was able to take advantage of their multi-supplier strategy to get chips from another source in only three days. Ericsson on the other hand was not so lucky and it took them considerably longer to resume similar operations (Yu et al. 2009). Some research has shown that “dual sourcing is especially beneficial when service levels are high, or when single sourcing has similar costs” (Veeraraghavan et al. 2008). When demand is high or when the cost of keeping a single source viable in the presence of disruptions is high, it is advisable to have a backup strategy in case of failure, which is the case with munitions.
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Single sources should be the dominant strategy only when the supplier’s capacity is larger than the demand, which has been shown not to be the case in the current DAIB structure.
The general consensus among experts is that all other scenarios require at least dual sourcing as the optimal strategy (Burke et al. 2007). Single sourcing is only advisable for items with large stockpiles which meet previous criteria, but in the case of critical or high-demand supplies, more than one source is advisable. While DOD is modernizing many of its older facilities, like the Lake City Army Ammunition Plant, this will not increase production capabilities to meet current requirements without adding additional facilities and production lines (Anderson et al. 2010). Based on the arguments provided here, these funds may be better utilized in developing an entirely separate capability to serve as a resilient backup to what currently exists.
The proliferation of large caliber small arms in the last two wars has made acquiring ammunition for them problematic. The DOD, in its quest for newer types of ammunition such as the Mark-323 MOD-0 Polymer Case Round, ran into production capacity issues at its organic facilities and had to seek commercial facilities for these supplies. However,
DOD suggested in its own report to Congress that, while the company producing the
Mark-323 is economically viable in the near term, future viability is questionable without government support (DOD 2012). Since commercial entities need a steady stream of customers in order to remain viable, this is an instance where the government may take the opportunity to create an alternate capability from the onset. The major ramification of having a dual capability is the additional cost of a duplicate facility as well as labor and operating costs. However, modern manufacturing processes and their corresponding
76 smaller footprints and labor requirements can go a long way to alleviating some of these initial and fixed costs. The consequences of not having these capabilities would have far greater ramifications and costs.
6.2 Application of CARVER
A routine target analysis similar to those conducted by U.S. Special Operations
Forces shows that to a determined adversary (as well as to an unpredictable force of nature) the listed facilities are very vulnerable and are at high risk of disruption. The
CARVER matrix is an Army Special Operations Forces (ARSOF) tool that has been in use for decades. It is used by operational personnel throughout the targeting and mission planning process to assess targets and the consequences of their interdiction. Since
ARSOF intent is not always total destruction of a target, this assessment helps to determine which components thereof will provide the most (disruptive) effect for the least effect on the population. This is a very important consideration, as one of the primary missions of ARSOF operations is winning ‘hearts and minds.’ This process is briefly described here; however, the targeting process is described in more detail in Army
Field Manual FM 34-36 (Army 1991). CARVER is an acronym for the following variables: Criticality, Accessibility, Recuperability, Vulnerability, Effects and
Recognizability. This particular process was chosen based on the author’s long experience with a proven tool that has a history of successfully assessing vulnerability of targets for ARSOF since the 1950’s. CARVER selection factors take the criteria described below into consideration, and are given a numerical value in the matrix. The sum of the values in the matrix presents a prioritized list of the highest to the lowest valued target; or, as previously mentioned, a component thereof that can be interdicted in
77 order to satisfy the requirements stated in the commander’s intent. Use of the CARVER
Matrix will graphically depict the desirability of each facility as a major target and the consequences of its interdiction on national security. This applies regardless of the mechanism of disruption.
Criticality is the target value, and is used as a primary consideration in the targeting process. A facility is critical when its disruption will have a significant effect on military, political, or economic conditions. These conditions may have local, regional or even national ramifications depending on the size of the system disruption or the significance of the particular node that is disrupted. For example, if one has a manufacturing facility with one rail line to a loading dock for shipment, then disrupting the line would affect
100% of one’s output until that capability is returned to normal or replaced. Or, if the railway crosses a particular bridge on a single line, then interdicting the bridge has the same effect. Both of these scenarios disrupt the supply chain 100% without ever affecting the manufacturing facility itself. These simple examples illustrate how the CARVER process is used in targeting. Values may be assigned for Criticality based on the following criteria: listed times are used to account for supplies from remote storage, or the time to reconstitute (at least a temporary capability) at another location, which may not necessarily be at the same site as cleanup or other activities which may be required before any reconstruction may be initiated.
Assessment of Criticality Point Value
Immediate disruption of all production and services; 9-10 Or, reconstitution takes longer than six months
Disruption of six months, or a 66% reduction in output 7-8
Disruption of three months, or a 33% reduction in output 5-6
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Disruption of one month, or a 10% reduction in output 3-4
No significant effect on output or service 1-2
Accessible facilities are those reachable by an adversary, or in the area of
influence of a natural hazard as previously described. The ease of accessibility or
proximity to the area of influence is reflected by the score given, which is described
below. Each critical path should be considered for both an adversary as well as a
natural hazard, as well as the effort needed to bypass, neutralize or penetrate any
barriers or obstacles along the way. For example, mountains, rivers, lakes, and other
natural obstacles can affect weather, hinder the progress of an adversary, or alter the
effects of an incident such as an earthquake. Additionally, the use of standoff
weapons should always be considered in such accessibility assessments, which may
negate obstacles just as a natural hazard may.
Assessment of Access Point Value
Easily accessible; Standoff weapons can be 9-10 Employed; No obstacles to natural hazards
Inside a perimeter fence, but outdoors 7-8
Inside a building, on the ground floor 5-6
Inside a building, but on a high floor or 3-4 in the basement
Inaccessible, or accessible with extreme 1-2 Difficulty; Minor or major natural hazards
Recuperability refers to the time it takes to reconstitute the capability, but not necessarily to rebuild the disrupted facility. Recuperability may take the form of a temporary capability, an alternate supply, and/or a storage capability. In this instance, similar number values as used in determining criticality (above) may be used for the time
79 to reconstitute. This applies to any aspect of the operation whose disruption will affect the overall capability; for instance, are special components needed, is the disruption such that cannibalization of parts or machinery is not possible, are there environmental conditions present that will prevent personnel from accessing the facility for any period of time, etc.? Questions such as these, used when applying the CARVER Matrix, will help assess the time that will be required to recover the capability and consequently, how long an adversary will be without this capacity.
Assessment of Recuperability Point Value
Rebuild, repair or replacement requires six 9-10 months or more
Rebuild, repair or replacement requires three 7-8 months or more
Rebuild, repair or replacement requires one 5-6 months or more
Rebuild, repair or replacement requires less 3-4 than one month
No significant time to reconstitute 1-2
A facility is considered vulnerable if a threat can successfully disrupt its operations.
Again, this relates to any aspect of the operation that will affect the overall capability. So a tornado destroying the only bridge out of one’s facility is a significant disruption even though the facility itself is completely intact. The following values are assigned for facility vulnerability based on the various natural and man-made hazards noted.
Assessment of Vulnerability Point Value
Small arms fire, weak natural hazards; 9-10 Small amounts of explosives (< 5lbs)
Light weapons, minor natural hazards; Medium 7-8
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charges (20 -50 lbs); Minor hurricanes and tornadoes
Medium anti-armor weapons, larger charges (50 – 100 lbs); 5-6 Moderate natural hazards
Heavy anti-armor weapons, heavy charges (100-300 lbs); 3-4 Severe natural hazards
All but the most extreme hazards; Truck bombs in excess of 1-2 300 lbs
Effect is a measure of the impact on the military, economic, political, psychological and sociological aspects of the affected population. Effect can be just local, regional, and/or national in the case of a strategic capability. In this instance, the effect on the military as well as psychological effect on the national government and public are paramount. Generally, any collateral damage should also be taken into consideration, such as the effects on employees, their homes, the roads they use to get to the facility, etc.
It should be noted that these effects are subjective and will be rated differently at the local, regional and strategic levels. Here we primarily consider the strategic level (as threats to DAIB are national assets).
Assessment of Effect Point Value
Overwhelmingly negative effects; No positive effect 9-10
Moderately negative; Few significant positive effects 7-8
Moderately positive effect; Few significant negative effect 5-6
Overwhelmingly positive; No negative effects 3-4
No significant effects (neutral) 1-2
The final “R,” Recognizability, applies more so to man-made than to natural hazards.
In this instance the same values used for vulnerability will be used for natural hazards. As far as man-made hazards, recognizability is the ability of an adversary to identify the
81 facility. The following values are assigned for man-made hazards if the facility is recognizable:
Assessment of Recognizability Point Value
Under all conditions and from a distance, requires little 9-10 or no training for recognition
At small arms range, a small amount of training 7-8 is required for recognition
With difficulty at night or in bad weather, and 5-6 requires some training for recognition
With great difficulty at night or in bad weather; and 3-4 requires extensive training for recognition
Recognizable only by experts; but not by anyone else under 1-2 any condition
Vulnerability and risk matrices for the facilities currently comprising the DAIB are presented below in Table 6-1 and Figure 6-1. The author assessed values as shown, based on the findings in this study and the target analysis criteria above, while keeping in mind that every one of the DAIB facilities is a national asset and a recognized Single Point of
Failure (SPOF).
Table 6-1: CARVER Matrix for Current DAIB Facilities
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Using CARVER, the maximum possible point value is a total of 60 points (using a maximum of 10 points for each of the six assessed C-A-R-V-E-R areas). Table 6-1 above shows that the disruption of any one of these individual DAIB assets (let alone a large- scale natural disaster that impacted more than one DAIB facility simultaneously) reveals assessed point value ranges from 85% to 92% of maximum. Application of CARVER in this manner (as our elite military forces would assess potential disruption to critical supply chain and infrastructure facilities in a hostile nation, where we wished to cause major disruption) confirms the SPOF nature of these DAIB assets and further reinforces the need for additional capabilities in a sobering manner.
Figure 6-1: Risk Factor Susceptibility
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Figure 6-1 also graphically depicts the risk for the listed factors, which range from a high of 100% for the ages of the facilities (all of which are all over 70 years old), to a low of 57% for hurricane risk. While a broader range than the CARVER assessment above, these are still very high risks that warrant consideration due to the critical nature of DAIB facilities being SPOF national assets.
6.3 Future Research
There are several areas still not fully explored as far as the DAIB is concerned. The impacts to the supply chain with regard to the many disparate materials that comprise modern ammunition, and the potential disruption of their sources was shown in this research to be lightly covered. In addition, the sources for many rare and specialized materials may be controlled by entities not entirely friendly to United States interests.
There is concern among western nations regarding the acquisition of large mining and processing facilities of rare or exotic materials. Furthermore, a study of costs associated with generating additional capability in the DAIB, utilizing modern manufacturing processes and facilities, and what the long term return on investment would be may be an effective exercise in determining a cost effective path to increased ammunition supply chain security.
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