REDSTONE ARSENAL, Ala.-- For more than 200 years, the U.S. military has relied on a set of unique, highly technical facilities to equip its warfighters. Known as the Army's Organic Industrial Base (OIB), a subset of the larger defense industrial base, these depots, arsenals and ammunition plants manufacture, repair, and reset the military's equipment.
Today's OIB, managed by the U.S. Army Materiel Command, includes 23 geographically-dispersed facilities, each specializing in a core competency. Together, they are the centerpiece of Army readiness, said Gen. Dennis L. Via, AMC commanding general.
From small arms, explosives and cannon tubes, to trucks and tanks, the OIB provides depot maintenance work and supply support across all DOD services.
"The OIB builds readiness for our Soldiers and Brigade Combat Teams, provides critical surge capabilities in support of global contingencies, and ultimately ensures our warfighters have the best equipment possible," said Via.
Because much of the work done at the OIB facilities by highly-skilled artisans cannot be replicated in the private sector, and provides the Army a unique capability to quickly react to conflicts and contingencies with the necessary equipment when they arise, Via equates the OIB to a "national security insurance policy" for the Army and nation.
"Similar to an insurance policy for your home or automobile, although we may not always need it at the moment," he said, "when we do, we need the OIB to be responsive, dependable, and reliable."
While the OIB surged for more than a decade in support of Operation Iraqi Freedom and Operation Enduring Freedom, resetting nearly 4 million items -- a workload three-times that of the Vietnam War -- operations at the facilities are now slowing. The workload needed has declined significantly, and the Army and AMC must determine how to preserve the capabilities to meet future requirements.
"Key to our ability to sustain the force of tomorrow is to preserve the industrial base of today," said Via. "We are continually optimizing our OIB processes, but we must also continue to invest in these facilities to enhance capabilities."
The OIB is funded through the Army Working Capital Fund, meaning the cost to operate the facilities are paid by the income brought in by the workload. The challenge is that operational costs are increasing at the same time workload is decreasing, said Eddie Lewis, chief of AWCF at AMC. That leads the OIB to have to increase rates to customers.
"If we can reduce rates, we level the playing field with the private sector's defense industrial base and increase competitiveness of our Army depots, arsenals and ammunition plants," Lewis said.
With lower rates, the OIB can attract more business, both through partnerships with the private sector and work from the other military services. All this means the production lines remain warm and ready to ramp-up when needed, and the workforce continues to keep their skillsets sharp.
As a means of investment into the insurance policy, AMC has requested that non-mission costs -- those related to installation management -- be removed from the rate structure and absorbed elsewhere by DOD. Essentially, costs such as fire, emergency services, security and other expenses associated with keeping the installations open, but not directly involved in operations, would be funded through an appropriated source. Costs associated with the industrial mission would continue to be funded through AWCF, and without the additional expenses, the OIB could offer lower rates to customers.
This is nothing new to the military; other services' industrial activities are tenants on the bases where they reside, absolving them of those expenses. But the request will mean DOD will have to absorb the additional expense -- the cost of maintaining an insurance policy for national security, a small cost given the incredible readiness value the OIB provides, Via explained.
"The Army's OIB is a national security asset, providing a critical capability in delivering readiness, not only to the Army, but to the entire joint force," said Via.
"Although we are facing challenging fiscal times, support of these critical and unique industrial facilities must remain a priority."
For now and until the policy changes, AMC continues to explore other means for keeping the OIB workforce gainfully employed and the lines running, said Lewis.
The command is making a concerted effort to showcase its abilities to private industry to increase Public-Private and Public-Public Partnerships and draw in new business. Increasing interest from U.S. allies also means increased business through Foreign Military Sales. AMC is also putting Lean Six Sigma practices into effect to streamline and optimize OIB processes.
"The bottom line is that we must retain the critical maintenance and manufacturing skills and capabilities necessary to meet any enduring needs, while providing flexibility for future requirements," said Via.
"The Army OIB is a national treasure that we simply cannot afford to lose."
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