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Cadet's procurement research could save AF $4.9 billion
Cadet 1st Class Chris Kirk developed a method that would let the Air Force purchase Advanced Medium-Range Air-to-Air Missiles and extended range Joint Air-to-Surface Standoff Missiles at significantly lower prices, saving more than $4 billion over five years. Kirk is a management major and native of Burlington, Iowa. (U.S. Air Force photo/Don Branum)
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Cadet's procurement study could save AF $4.9 billion

Posted 2/20/2013   Updated 2/21/2013 Email story   Print story

    


by Don Branum
Air Force Academy Public Affairs


2/20/2013 - U.S. AIR FORCE ACADEMY, Colo. -- A cadet's research into how the Air Force buys missiles could save the service as much as $4.9 billion over five years while increasing the Air Force's inventory.

Cadet 1st Class Chris Kirk found that the Air Force can buy some of the missiles regularly used in combat operations using economy of scale, much like large retailers do to buy products at substantial discounts, according to a briefing the cadet presented to Air Force Chief Scientist Dr. Mark Maybury here Feb. 1.

"Simply put, Cadet Kirk's research promises more munitions for less money," Maybury said. "Even my boss (Secretary of the Air Force Mike Donley) would pay attention to that."

Kirk, who is majoring in management, spent several weeks at the Pentagon working with officials at the Air Force Acquisitions Directorate as part of the Air Force Academy's Cadet Summer Research Project, which sends cadets to installations across the Air Force each summer as interns to conduct research on operational Air Force issues.

Kirk's research examined three procurement methods the Air Force could use to reach inventory levels of 100 percent for its missiles. The first, called the minimum sustainment rate, purchases munitions at the lowest level possible without jeopardizing the supply pipeline. The second, called the economic order quantity, offers an ideal quantity for both the Air Force and the contractor. Finally, the maximum rate determines the contractor's overall production capacity.

Anyone who's been to the commissary knows the value of purchasing at wholesale cost: commissaries generally save customers an average of 30 percent on grocery purchases, according to the Defense Commissary Agency website.

The same concept applies to Advanced Medium-Range Air-to-Air Missiles, or AMRAAMS, and to extended-range Joint Air-to-Surface Standoff Missiles, or JASSM-ERs, according to Kirk's research. The procurement changes would cut AMRAAM procurement costs by $1.5 billion and JASSM-ER procurement costs by $2.6 billion.

"Proposals for reducing the costs of new procurements are very important to defense planners," said Col. David Chelen, chief of the Global Power Programs Directorate's Weapons Division and an '89 Academy graduate.

Uncertainty about future defense spending due to the threat of sequestration has kept the Pentagon from implementing Kirk's proposals, Chelen said, "but his suggestions and the research that drove those ideas will remain useful into the future."

Maj. Daniel White, an instructor in the Academy's Management Department, called Kirk an outstanding student for the quality of his work and his proactive attitude.

"What impresses me the most about his missile procurement research is his ability to get a handle on such a large amount of information in such a short period of time and bring useful conclusions from it," White said. "He's also very good at thinking on his feet in front of very distinguished audiences."

Kirk, who saved the life of a civilian involved in an accident June 9, 2012, on Interstate 495, called his chance to conduct research at the Pentagon and his time in Washington an "awesome" experience.

"It's one of the most rewarding things I've been able to do, just being in the Pentagon, working on this project, and taking trips all over D.C.," he said. "There's so much going on."



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