COST SAVINGS FROM THE BOTTOM UP


FIGURE 1


the clean-sheet informed the full-rate pro- duction decision and acquisition strategy; as an expensive product obtained from a sole source, PGK is a good candidate for the ground-up analysis of clean-sheeting to make sure the government is getting its money’s worth.


SAMPLE COMPONENT CLEAN-SHEET This clean-sheet chart shows that the current price of a sample component is 59 percent higher than it could or should be, assuming the best possible production rates and material costs. To deter- mine this percentage, clean-sheet analysts start from the bottom up, building the item from scratch. (SOURCE: Robert Steere, PM CAS)


PGK DETAILS Te PGK is a GPS-based trajectory- correcting system with fuzing functions that provides near-precision capability for 155 mm conventional, high-explosive artillery projectiles. It is screwed into the fuze well of the M795 or M549A1 high- explosive projectiles and fired from the M777A2 Lightweight Towed Howitzer or M109A6 Paladin Self-Propelled How- itzer. Te fuze can function in proximity or point-detonating mode, with a dem- onstrated “circular error probable” of less than 30 meters—which means that when rounds are fired, at least half land within 30 meters of the target (See Figure 3 on Page 109.) Te PGK possesses a safety feature that will render the projectile inert if it is not going to hit close to its assigned target.


assumptions in the model are based on industry standards, world-class processes and competitive pricing to produce the best possible should-cost potential for the design. Te model also compares the should-cost to the current cost to identify cost gaps, which can be seen as opportu- nities for future reductions.


Te goal of clean-sheeting is not to


uncover the ultimate truth in numbers, nor to provide all information required for an accurate estimate. Instead, clean- sheeting provides cost


transparency to


help identify material savings, opportu- nities and profit, as well as new ideas for design and process improvements, such as a different process flow, manufactur- ing footprint or production technology.


106 Army AL&T Magazine April-June 2016


Picatinny Arsenal, New Jersey, is the home of Product Manager GPM2S, a subordinate organization of


the Proj-


ect Manager for Combat Ammunition Systems (PM CAS) in the Program Executive Office (PEO) for Ammunition. PEO Ammunition is responsible for life- cycle management across all ammunition families with a mission of developing, equipping and sustaining lethal arma- ment and protective


systems enabling joint warfighter dominance.


After an initial competition, the PGK program selected one prime contractor, which was later awarded a sole-source production contract. PEO Ammunition selected the PGK program for the clean- sheet process, and the information from


PGK attained urgent material release in March 2013 and was fielded to limited Army field artillery units shortly there- after. PGK attained full material release in December 2015 and is currently being fielded to all Army field artillery units.


THE CLEAN-SHEET PROCESS Te first step of the clean-sheet process is to visualize the product manufacturing flow. Ten the required raw materials and processes are identified. Te third step is to allocate resource costs for material, labor and equipment. Finally, overhead costs are added to the model; these include the indirect resources needed to run plants, the amortization of one-off investments in research and development, equipment and tooling, and the effects of


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