Admiral sets course for the future

Rear Adm. Patrick M. Stillman a year ago took command of the Coast Guard's massive fleet modernization. As the first program executive officer for the Integrated Deepwater System, he leads the effort to replace more than 90 cutters and 200 aircraft.An essential part of the effort is creating a modern systems and communications infrastructure. The acquisition, expected in July, will be the largest in Coast Guard history. Currently, the Guard is evaluating bids in a fly-off competition. Boeing Co., Integrated Coast Guard Systems'a team that includes Lockheed Martin Corp., Northrop Grumman Corp. and Ingalls Shipbuilding of Pascagoula, Miss.'and Science Applications International Corp. of San Diego are vying to design, develop and roll out systems they outlined in the project's first phase. Before joining the Deepwater team, Stillman was assistant commandant for governmental and public affairs.He also has had numerous assignments at sea, including stints as operations officer, executive officer and commander of the Coast Guard barque Eagle. His shore assignments have included postings as chief of staff, chief of operations and chief of the Atlantic-area operational forces.Stillman has a bachelor of science degree from the Coast Guard Academy. He holds a master of arts degree from Wesleyan University and a master of public administration degree from George Washington University.Staff writer Preeti Vasishtha interviewed Stillman at Coast Guard headquarters. STILLMAN: We have recognized the fact that command, control, communications and computer systems as well as the intelligence that drives them need significant change. The present operational suite tied to the system is woefully inadequate.We are confronted with a lack of commonality that tends to increase the lifecycle support costs and logistics problems.We are challenged in a technical sense to use an open systems architecture that is modular to keep the costs down.We're not modernizing the Coast Guard based on what we have today. We are trying to modernize according to what we will need 25 to 30 years from now.STILLMAN: The Deepwater system is comprised of more than 206 aircraft, 49 patrol boats, 12 large ships and more.This system of operational assets is not integrated at all.Also, our larger ships deploy with the Navy, but we don't have the capability to communicate with the Navy. So when we do deploy the ships, we have to spend a lot of money to install link capabilities, and that's just not the way to do business.STILLMAN: I think that if you look at most large acquisitions, particularly in the defense arena, technology and the R&D cost are key drivers in terms of the eventual bill that the American taxpayer has to write the check for.If you look at the strategy with respect to the Deepwater system, I think we were very conservative, frugal and realistic in terms of how we should address the issue of technology.We mandated that the system use commercial products. We mandated that nondevelopmental items were fundamental to the undertaking. We indicated that an open systems architecture was fundamental as well and that the industry team should design that from the start and take full advantage of evolving technology.Ultimately, Deepwater will improve our operational effectiveness while lowering or maintaining total ownership costs.STILLMAN: We knew we could not do this solely within the context of the expertise of the Coast Guard.We mandated early on that we needed a systems integrator to help us define the best approach, predicated on performance, total ownership cost and operational effectiveness.Do we modernize existing assets or replace aging assets? Do we re-engineer the logistics process or do the maintenance in-house? There are countless questions that are tied to portfolio management.What you do is set up an award-term concept with the integrator over a five-year period and offer incentives in areas where you can truly make a difference.For example, we have an engineering share-in-savings contract where the integrator shares the benefits of innovative ideas that help the Coast Guard.Integrated product teams are the way to move the project forward, rather than establishing a hierarchy in which it takes months to make decisions.STILLMAN: We will hire the integrator for five years. During those five years, we will evaluate the performance of the integrator to meet the specifications of the contract. That will be done openly so the integrator knows how it is being assessed. There will be no surprises.I am confident that the integrator will want to have a long-term relationship with us rather than a five-year term. Why? Because cash flow is very important in this business, and the contractor could be working for the Coast Guard for up to 30 years.Will that promote a sole-source environment? I don't think so. I appreciate GAO's concerns that a 25- to 30-year contract could affect the competitive nature of the project, but the reality is that the integrator will be able to promote competition among subcontractors, and competition is extremely important at that level.We are going to evaluate the competition at that level, and obviously that plays into the issue of giving the taxpayers the best value for their dollar.The other facet of this issue is more subjective. I am convinced that you've got to simplify complex issues so people will understand what you are trying to accomplish.Nothing is more important in this undertaking than people.I am committed to retaining people and letting them grow. I want to have a sense of family and community.That commitment extends to the private-sector employees who work on Deepwater because they are going to have as much of an impact on the Coast Guard as I am. They will design and produce equipment that young men and women in the Coast Guard will depend on to carry out their mission.Our focus on people is complemented by a focus on partnership. I don't for a minute think that this will succeed without a partnership with the integrator and subcontractor. If we don't have that, we are doomed to fail.Stillman: I totally agree with GAO and Congress that sustainability and stability in terms of long-term funding are important to the success of the project.You must design a strategy that allows you flexibility. Can you accommodate reduced funding levels? During certain periods of time, sure you can.Every year we will dutifully attend to the issue of how much money we have and what statements of work we are going to execute.If it falls significantly below $500 million over an extended period of time, we'll need to step back and take stock in the project to see if it is providing value for the taxpayer.The reality is that the longer you take to implement the new system, the more it's going to cost.And we know the best way to do this is to spend well over $1.2 billion for 13 years to get this as soon as we can. But we also know that we will never get that money for 13 years.So, that $500 million was a realistic figure.The other side of the coin is that we have to hit home runs early and often. If we don't succeed, then by God we don't deserve to get funding.