Sikorsky Parts Issues Come to A Head With LeveL III CAR
On December 1, 2006, DID published “Sikorsky Parts Issues Receiving Media Attention,” covering work by the Project on Government Oversight (POGO) and WTNH TV re: “high visibility issues” related to Sikorsky helicopters and parts.
Now WTNH’s Alan Cohn reports in “Shake-up at Sikorsky following Defense Department letter” that the Defense Contract Management Agency has escalated Sikorsky to a Level III Corrective Action Request. This gives Sikorsky 30 days to fix recurring problems in Black Hawk quality control, and demands “immediate action to mitigate mounting risk.” The letter says “management oversight is out of control” and describes quality problems as “mounting in seriousness”. In response Sikorsky has reportedly fired its VP operations and is making other moves. The complete DCMA letter is reproduced below:
The letter is dated November 22, 2006, as is written by Dorothy J. Freer to DCMA Sikorsky Aircraft and Jeffrey Pinto, the President of Sikorsky Aircraft Corp. CC:s were sent to UH-60 PMO; NAVAIR PMAs 261, 271I & 299; the Director of the DCMA Aeronautical Division; the DCMA Contract Integrity Center; and the DCAA Resident Auditor for Sikorsky Aircraft Corporation.
Dear Mr. Pinto,
When I wrote to you on 23 June 2006 to express my concerns with your quality, I had high expectations that these concerns would be disposed of quickly. Regrettably, we find ourselves nearly five months older and no better off. As I expressed in my original letter, the rapidity of your transformation and its poor execution, along with the culture at Sikorsky were the root cause of the quality defects. Now, it is apparent that the lack of planning (tactical and strategic) and the rate of change are out of control.
The drive to outsource, which has grown from the transformation, has become the panacea to Sikorsky’s inability to meet schedule and is increasing the number of quality defects. An example of this phenomenon is the offload/ outsource of the U/HH-60L/S70 production/assembly line. There have been at least four different “homes” for this process since I first wrote you. They have been Stratford, West Palm Beach, Crestview, and Schweitzer. Additionally, the scope of the work to be done in these sites have ebbed and flowed like the tide. From my vantage point the apparent lack of detailed planning to execute the ultimate move to Crestview has been appalling and has manifested itself in the issuance of several Level II Corrective Action Requests (CARs) in Crestview. Your own onsite inspections of the L3 facility have only served to reinforce and expand the findings of those CARs. The reactive nature of your oversight in Crestview is evidence of the lack of adequate prior planning and is of great concern because the aircraft assembly is continuing despite the numerous issues raised regarding proper work instructions and training.
The bottom line is that quality is deteriorating, schedule is not getting better in the short term, and the seriousness of the errors that are occurring due to the perpetual change cycle as evidenced in Crestview, are becoming untenable. In addition, Sikorsky is pursuing increased domestic and foreign sales and in many cases receiving these awards (The recent sale of seventeen aircraft to Turkey is one example [DID: see our coverage of that sale, which had a number of special features]). I realize that some of these will be direct commercial sales, but I am concerned what impact the increase in volume will have on military aircraft schedule, quality, and cost. While I have been provided briefings on some portions of your plans, I have not seen a comprehensive strategic and tactical plan addressing Sikorsky’s future ability to meet overall delivery requirements. As an example, I haven’t received the definitive contingency plan including a schedule for your Schweizer facility. Consequently, I have no confidence that you will be able to meet future contractual requirements for Brazil three and four. As I said above, it appears that management oversight is out of control and is driving quality escapes that are mounting in seriousness.
Based on the above, I am issuing a Level III Corrective Action Request and request your detailed plan to correct these deficiencies. I strongly encourage you to consider all possibilities including ceasing all operations at Crestview until all processes are brought under control and an adequate First Article Test in accordance with your procedures can be conducted on Jordan 04-27027 and Blackhawk 06-27078. I expect a formal response to this letter within thirty days. At a minimum, I expect a complete and comprehensive plan which addresses the circumstances ennumerated above, ensures contractual compliance, and prevents recurrence. However, due to the serious nature of the quality issues, I expect immediate action to mitigate the mounting risk.
Congressman Chris Shays [R-CT], who has looked into Sikorsky quality issues in the past, was unequivocal. In a statement to WTNH News Channel 8, he said that “There can never be a question about quality when it come to the equipment our men and women in the Armed Forces use. The management of Sikorsky needs to address every concern and quickly.”
DID: What is a Level III CAR?
A Level III CAR is a serious action just one step below the possibility of suspension or termination of contract. The DCMA Guidebook’s “Navy Special Emphasis Programs (NSEPs) Quality Assurance Representative’s (QAR’s) Instruction” as revised on March 30, 2005 discusses Level III CARs in 126.96.36.199 and subordinate passages:
“188.8.131.52 – A Level III shall be used to call attention to serious contractual non-compliances. A Level III will be used when prior requests for corrective action have been ineffective in obtaining contractor resolution of a non-conformance and the contractor will not take additional or appropriate action. Due to the seriousness of the issue, there may be occurrences when a Level III corrective action request may be appropriate yet prior Level I or II corrective action requests may not have been issued. This will not be a normal practice. Level III CARs are normally supported with prior issued Level II CARs.”
Level III CARs are serious and rare, but not unheard of; in time, many are resolved via acceptance of the company plan and requisite improvements. Most of the time, coverage ceases after the attention-grabbing CAR. DID’s earlier offer to Sikorsky still stands, however; and we hope to be able to cover the complete arc of this story over time with cooperation from the parties involved.
Additional Readings & Sources
- DCMA Guidebook (last revised March 30/05) – “Navy Special Emphasis Programs (NSEPs) Quality Assurance Representative’s (QAR’s) Instruction
- WTNH (Dec 5/06) – Shake-up at Sikorsky following Defense Department letter – Story by Alan Cohn [Windows Media format]
- POGO – Archived PDF copy of DCMA Level III CAR to Sikorsky (bitmapped graphic format)
- POGO – Archived PDF of Sikorsky internal quality documents
- POGO (Nov 30/06) – Sikorsky Parts “Departed the Aircraft”