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4/16/2010

Pentagon’s Industrial Policy Office to Host Meetings With Lower Tier Suppliers
The Pentagon’s industrial policy office will be hosting at least two “roundtables” with corporate representatives of lower tier suppliers.

A senior official said the meetings will each include 20 to 25 executives and will take place later this summer. Only subcontractors — second-tier to fourth-tier suppliers — are being invited. The intent is to gain first-hand knowledge of the financial health and capabilities of smaller firms that typically don’t engage directly with the government and only work with prime contractors.

The Pentagon’s Director of Industrial Policy Brett B. Lambert said shortly after taking office that he would turn his attention to subcontractors out of concern that the economic downturn may drive smaller firms out of business. Some of the lower-tier suppliers provide critical components that are needed in major weapons systems. Rather than wait to be told that certain components are no longer available, industrial policy officials want to know ahead of time, so the government can take action to preserve critical sources of supplies, Lambert said in an interview earlier this year. “When we terminate programs, the cascading effects on the lower tiers can be catastrophic,” he said. “The bulk of our resources goes to primes but my concern is the lower level. … That’s where I think we are experiencing the difficulty.”

The Defense Department’s weapon acquisitions chief, Ashton Carter, who oversees the industrial policy office, said the government needs to have a greater understanding of the defense industrial base. “What’s critical is to preserve things that are difficult to rebuild and cannot be replicated in the commercial sector,” he told an industry conference. “I’m frustrated with the quality of information available to us,” Carter said.

Deputy Defense Secretary William Lynn told an industry forum on Capitol Hill last week that Lambert will be launching an “industry-by-industry, sector-by-sector review" of the defense industrial base. Following the study, the Defense Department will decide whether it needs to support “design teams” for certain technologies in order to ensure they are available in the future. “We're trying to build the cross-sector analysis of industry and use that to inform all of our industrial base decisions,” said Lynn.
Posted at 3:18 PM by Sandra Erwin | Permalink | Email this Post | Comments (0)

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