Joint Government and Industry Executive Forum for Lead (Pb)-free Electronics

Joint Government and Industry Executive Forum for Lead (Pb)-free Electronics

Transitioning to lead-free electronics in the Aerospace and Defense (A&D) industry demands careful analysis and research into the performance, costs and availability of these materials. The Aerospace Industries Association sponsored a Joint Government and Industry Executive Forum for Lead-Free Electronics to examine the issues underlying implementation of these materials. The participants concluded a clear roadmap with discrete milestones, funding to accomplish these efforts and dedicated government leadership are key to the A&D industry’s successful transition. 

Why is this issue so important? The A&D industry designs and manufactures products that carry more than three billion passengers worldwide on any given day as well as systems which are vital to our national security.  Our ability to maintain public safety and assure our warfighters’ mission success cannot be compromised or risked. 

In response to the 2003 European Union Directive on the Restriction of Hazardous Substances, the commercial electronics industry transitioned to lead-free (Pb-free) electronics. Although the A&D industry leverages consumer and commercial technologies to provide affordable design solutions, many of the foundational commercial material standards are inadequate when applied to A&D products. Therefore a growing technology gap between the industries has appeared. Investment is needed to bridge this gap, so that A&D systems can preserve access to affordable commercial technology, while continuing to provide the requisite performance and reliability. Based on experience, the A&D industry believes a nationally coordinated approach is the most efficient way to bridge this gap.

Acquisition Rebalancing: Recommendations for Smart, Efficient & Effective Defense Procurement

Acquisition Rebalancing: Recommendations for Smart, Efficient & Effective Defense Procurement

The Department of Defense (DOD) must change how it acquires weapon systems and services. There is growing recognition from DOD leadership, Congress and the defense industry that it is time to revise the overly complex and burdensome system that drives unnecessary cost into programs and will soon make them unaffordable as defense budgets decline.

Making the acquisition system more economic and more responsive has been an elusive target. The challenges of time-to-delivery and product cost persist despite all attempts to reform the acquisition system over the last 40 plus years.

It’s time to stop tweaking the edges and bring the acquisition system into balance, starting with these core principles:

  • Have trust and confidence in the U.S. military and the aerospace and defense industry’s ability to deliver together outstanding technologies that keep our nation safe.
  • Balance oversight so that all parties are treated fairly and allow oversight functions to consume only the resources needed to mitigate risks of poor performance and malfeasance.
  • Employ our nation’s scarce resources to get the most value for our military from every dollar our nation invests.
  • Protect the nation’s economic and national security by developing and implementing cohesive defense industrialbase strategies.

These principles inform the recommendations presented in this paper, written to address the critical questions asked by the House and Senate Armed Services Committees. How can acquisition be more cost effective? Can delivery be expedited? Can recruitment, retention, and training of acquisition professionals be improved? How can program managers be empowered to make sound decisions, and how can technical expertise be fostered? Oversight and management ideas were also sought, as were recommendations to improve cost and delivery over the life cycle of major weapons systems. This paper is organized to address these questions and requests.

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Acquisition Rebalancing: Recommendations for Smart, Efficient & Effective Defense Procurement

Defense Acquisition Resources to Understand Acquisition Reform

AIA has complied a number of letters that address the federal defense acquisition process and ways in which reforms can be made to ensure the best value for defense customers.  They include the following letters and may be downloaded as a combined zip file below.
  • Join Working Group on Improving Cybersecurity and Resiliance Through Acquisition
  • AIA Comments on DFARS: Discllsure to Litigation Support Contractors (DFARS Case 2012-D029)
  • Federal Management Regulation; Disposal and Report of Federal Electronic Assets (Case 2012-102-4)
  • Burdens and Barriers to Contracting with the Federal Government
  • Response to October 30th Letter on BBP 2.0
  • Better Buying Power 2.0 - Commercial Items
  • Meetings with Alan Estevez, Katrina McFarland, and Dick Ginman regarding Costs of Regulation
  • FAR; Contractor Comment Period, Past Preformance Evaluations (FAR CASE 2012-028)
  • Pension Harmonization Rule Change
  • Cost Acounting Standards
  • MOCAS payment cycle times
  • DCMA Meetings regarding Corrective Action Requests
  • AIA Comments on implementation of Better Buying Power 2.0
  • AIA Comments on DFARS: Safeguarding Unclassified DoD Information (DFARS Case 2011-D039)
  • Section 818 NDAA 2012

HASC/SASC Letter

This letter from the House and Senate Armed Services oversight committees informed AIA that the Congress is looking into ways to improve the defense acquisition system. Specifically:

  • Steps that DOD or Congress could take to reduce the cost of major defense acquisition programs;
  • Steps that DOD or Congress could take to expedite the delivery of useful capabilities to the warfighter;
  • Steps that DOD or Congress could take to improve how it recruits, trains, and develops its acquisition workforce;
  • Steps that DOD or Congress could take to empower key acquisition personnel, such as program managers and cost estimators, to make sound choices through the acquisition process;
  • Steps that DOD or Congress could take to improve planning, contracting, oversight and management of services; and
  • Steps that DOD or Congress could take to incentivize timely delivery of capabilities and services to warfighters with considerations for life-cycle costs.
AIA Conflict Minerals Education Update

AIA Conflict Minerals Education Update

This document serves to inform AIA members and their supply chains about the first round of pending Conflict Minerals Specialized Disclosure filings to the SEC. With the complicated nature of the Conflict Minerals Report format and audit protocol, AIA has prepared this document as a training guide to help answer some of the most common questions about the process.

In addition, based on the AIA Conflict Minerals Working Group Charter, this training document completes one of key goals of this collective group. In order to provide our member companies and their supply chains with the necessary guidance, we have released this information broadly to allow for review and consider prior to the SEC filing deadline of June 2, 2014 for the first Conflict Minerals Specialized Disclosure.

Defense Research and Development

Defense Research & Development: From the Warfighter to American Consumers, Redefining Everyday Lives Through Innovation

Federal investments in science and technology research and development are threatened by the current budget environment. The Aerospace Industries Association is embarking on an education effort to inform policymakers, elected leaders and the American public on the impact of federal R&D dollars on the innovations that redefine our everyday lives.

This report – the first in a series that examines the impact of federal investment programs – highlights four case studies of private sector technologies and products that have been largely defined or influenced by defense R&D spending. These case studies include the cellular smart phone, the hospital operating room, the modern automobile and the flat screen television. Each case study provides a narrated illustration of
the product and its connections to defense R&D.

The President’s budget for fiscal year 2015 requests a reduction in science and technology funding across both defense and non-defense discretionary accounts. This would reinforce existing reductions from the past several budget cycles. If sequestration is not addressed in fiscal year 2016 and beyond, this downward angle could turn into a nosedive. AIA believes policymakers must ensure a robust and balanced defense
research program, not only for the substantial benefits it provides to America’s warfighters, but also for the resulting commercial innovations that help grow our productivity and our economy.

Over the past six decades, federal investment in R&D programs has acted as an incubator for innovation, producing an immeasurable array of technological advancements that have come to define modern life and society at large. These investments have provided the basis for a revolution in electronic systems, communications, materials and medical science, the results of which have served as the building blocks for today’s most common technologies, including transistors, the Internet, GPS navigation and liquid crystal technology, to name a few.

The connection between research programs and commercial deployment of technologies is often multi-faceted. Program requirements can provide both the research impetus and critical opportunity for technology to mature through production and continual improvement. However, not all technologies that follow this path spill into the private market. Those that do are defined both by market demand and by calculated private investments that enable them to emerge as profitable products. These disparate paths demonstrate how investments made in advanced research can result in enormous contributions to the nation’s economy and industrial competitiveness.

Restoring Balance in the Defense Acquisition System

Restoring Balance in the Defense Acquisition System

Over the past quarter century, more than 300 commissions and studies have produced a variety of recommendations – some of which have become law – to change the way the U.S. military develops and buys new weapons systems. Yet the Department of Defense acquisition system continues to take longer and deliver less in quantity and capability while costs of modernization programs escalate.

AIA has taken a hard look at what is causing this problem to develop this issue paper about what was discovered to be a multi-faceted issue that largely revolves around extraneous and over burdensome policies, laws and regulations.

Solutions to reducing the burden include:

  • A more efficient and effective cost-benefit analysis program;
  • Better audit practices;
  • Reducing unaffordable burdens;
  • Expanding the use of commercial items;  
  • New intellectual property rules; and
  • Having a reasonable expectation for contractor pay and compensation.
The Conflict Minerals Story

The Conflict Minerals Story

One of the primary methods of supporting Conflict Minerals control is through responsible sourcing of the products that may contain conflict minerals. Responsible sourcing is an important principle of the AIA Supplier Management Council (SMC). The AIA SMC is now actively educating AIA member companies about the release of the SEC Final Rule and the pending disclosure requirements, working with other shareholders and industries involved with this challenge to synergize activities, and providing member companies useful guidance, in the form of best practices.

This document provides a thorough analysis of the issue and along with helpful tips for companies dealing with conflict mineral disclosures. 

AIA Conflict Minerals Snapshot

AIA Conflict Minerals Snapshot

One of the primary methods of supporting Conflict Minerals control is through responsible sourcing of the products that may contain conflict minerals. Responsible sourcing is an important principle of the AIA Supplier Management Council (SMC). The AIA SMC is now actively educating AIA member companies about the release of the SEC Final Rule and the pending disclosure requirements, working with other shareholders and industries involved with this challenge to synergize activities, and providing member companies useful guidance, in the form of best practices.

AIA Conflict Minerals FAQ

AIA Conflict Minerals FAQ

The following frequently asked questions document about conflict minierals outlines the background issues surrounding the issue, what the applicability and scope of the reporting requirements are, what a reasonable country of oragin inquiry (RCOI) is, what is acceptable due dilligence in reporting, how to report conflict minerals in manufactured products, and what an indipendent private sector audit is. 

Unsolved - The Continuing Saga of Lead-Free Electronics in Aerospace, Defense and High Performance P

Unsolved - The Continuing Saga of Lead-Free Electronics in Aerospace, Defense and High Performance Products

European Directive 2002/95/EC on the Restriction of the use of certain Hazardous Substances in Electrical and Electronic Equipment (RoHS) and the Waste electrical and electronic equipment (WEEE) Directive (2002/96/EC)ii have changed the global supply chain for materials used in aerospace products. The result of this market shift is of high concern for our industry, forcing the transition away from tin-lead alloys used in the assembly and coating for high performance electronics known as lead-free (Pb-free) electronics.

Aerospace Industry Guidelines for Implimenting Interoperability Standards for Engineering Data

Aerospace Industry Guidelines for Implimenting Interoperability Standards for Engineering Data

The variety of engineering tools used to support design, procurement, manufacturing, and support of aerospace products has never been greater. From company to company, tools and processes range from manual capture in 2D drawings to sophisticated 3D models that are tightly integrated with other enterprise systems - this guide helps provide a standard approach to work across the range of processes.

Sustaining the U.S. Defense Industrial Base

AIA Industrial Base Issue Paper

Commercial Items - Equipping Our Service Members with the Best

Commercial Items - Equipping Our Service Members with the Best

Using commercial items provides the Department of Defense (DOD) with distinct military advantages – access to a wide array of technologies and products developed through industry investment, generally at a lower cost and with a quicker turn-around time than through traditional acquisition programs.  Commercial purchases allow for faster insertion of technologies, lower life cycle costs and greater access to – and support from – the vast array of companies that make up the U.S. civil and military industrial base.

Sequester, Defense Budgets and the Industrial Base

Sequester, Defense Budgets and the Industrial Base

Mandatory budget cuts will dramatically and disproportionately reduce the Defense Department’s modernization accounts, which will damage the industrial base more severely than is commonly believed. The reasons for this that are enumerated in the paper include: The effects of sequester in 2013 were mitigated; Modernization funding, though roughly one-third of the defense budget, will likely absorb nearly half the cuts in sequester’s early years; and DOD is taking a "modernzation holiday"by committing between 15 and 20 percent less to needed programs.

State of the Defense Budget

State of the Defense Budget

Implementation of the Budget Control Act of 2011 is having severe adverse impacts on the defense budget. In real dollar terms, DOD investment spending (Procurement and R&D) in fiscal year 2013 is 24 percent less than it was in fiscal year 2011, the year before the Budget Control Act. Unless the act is changed, fiscal year 2014 could see another 14 percent reduction in investment spending.

Disruptive Information Technologies: Leveraging the benefits, avoiding the pitfalls

Disruptive Information Technologies: Leveraging the benefits, avoiding the pitfalls

This republished special report states the likely impact of specific high powered colaborative technologies on business, technical, cultural, operational and security for our industry. The key characteristics of each technology are described in the report along with the benefits, risks and mitigations. Each section provides recommendations to help companies exploit the technologies and proposes where appropriate including where AIA may act on behalf of the industry.

Radio Frequency Identification: Business scenarios that can benefit from the application of RFID

Radio Frequency Identification: Business scenarios that can benefit from the application of RFID

The AIA eBusiness Steering Group commissioned this report to identify the business scenarios where RFID could be effectively deployed in the aerospace and defense industry, based on growing industry experience of RFID in real applications. The report identifies some key successful applications in pilot and production environments, the lessons learned and challenges still remaining, and the most significant enhancements to the technology.

Policies and Codes of Conduct for the Use of Social Networks: Leveraging the Benefits…

Policies and Codes of Conduct for the Use of Social Networks: Leveraging the Benefits...

This report defines the key issues to be addressed when considering the use of social networking tools within an organization, in a controlled community and in a public environment. It also recommends that the content of policies and codes of conduct for the use of social media should be integrated with existing policies and codes of conduct related to computer usage and network access.

Cloud Computing: a Report on Cloud Computing used in the Aerospace and Defense Industry

Cloud Computing: a Report on Cloud Computing used in the Aerospace and Defense Industry

This paper explores the various applications of Cloud Computing used by industry and government. Based on the experience to date, it identifies the latest benefits, risks and business impacts of Cloud Computing, with particular reference to portability and interoperability.

REACH-IT

REACH-IT

A Framework for Understanding REACH with Guidelines for Integrating Systems and Addressing Compliance Requirements

The Unseen Cost - An Update

The Unseen Cost - An Update

In July 2009, the Aerospace Industries Association published a special report, The Unseen Cost: Industrial Base Consequences of Defense Strategy Choices. In this report, the AIA raised concerns regarding the long-term consequences and unintended impacts of contemporary defense strategies and direction. Recently, AIA has revisited this report.

The Economic Impact of the Budget Control Act of 2011 on DOD & non-DOD Agencies

The Economic Impact of the Budget Control Act of 2011 on DOD & non-DOD Agencies

AIA and economist Dr. Stephen Fuller of George Mason University unveiled a new report detailing job loss figures resulting from the Budget Control Act of 2011.

Affordable Defense Logistics

Affordable Defense Logistics

“Life Cycle Product Support / Outcome Based Partnerships” and “Management of Commodities” have the potential to save an estimated $20 billion to $25 billion annually.

Deloitte: The Aerospace and Defense Industry in the U.S.

The Aerospace and Defense Industry in the U.S.: A financial and economic impact study

This report was commissioned by AIA to assess the contribution and financial impact the U.S. aerospace and defense industry has had on the American economy, in terms of employment, cash taxes paid, impact on gross domestic product and other financial, economic and qualitative factors. Although typically focused on military and commercial aircraft, space systems and related supply chain portions of “aerospace and defense,” we broadened the definition for this study to include land vehicles and systems, naval vehicles and systems, security and defense contracting software and services. The scope does not cover the users of these products and services, thereby excluding the air transportation industry (cargo and passenger airlines) as well as government employees.

We estimate that the U.S. aerospace and defense industry directly employed 1.05 million workers in 2010. These workers received $84.2 billion in wages and paid $15.4 billion in U.S. Federal individual income
taxes, and $1.9 billion in state individual income taxes. Although not directly in the scope of this study, in addition we found that the Federal government employs an estimated 845,198 aerospace and defense skilled workers at armed forces maintenance and repair depots, National Aeronautics and Space Administration (NASA), Federal Aviation Administration (FAA), other defense agencies including Defense Advanced Research Projects Agency (DARPA) and civilians working at the Department of Defense.

We found the industry has an estimated indirect and induced employment of 2.36 jobs for every 1 directly employed. This employment multiplier is a “direct effect” multiplier, which accounts for primary and secondary effect employment associated with the aerospace and defense industry. It does not contemplate “final demand,” or employment associated with tertiary effect employment well beyond the direct effect of this industry’s employment base. Thus, we believe that indirect and induced employment totals 2.48 million workers, in addition to those cited above who are directly employed. Together with these indirect employees, we estimate the grand total direct, indirect and induced employment associated with the U.S. aerospace and defense industry is 3.53 million jobs, not including industry skilled workers employed by the Federal government or airlines. 

We estimate that these U.S. aerospace and defense companies generated $324.0 billion in sales revenue in 2010, with $15.6 billion in net income after tax at an average pre-tax reported operating profit margin of 10.5%. This margin percent metric was below average, when compared to other industries in America. These companies paid $5.5 billion in corporate income taxes on their earnings, as well as $1.7 billion in state income and similar business taxes. Thus together with individual direct employee taxes, the total industry generated an estimated $37.8 billion in wage and income based taxes to state and Federal government treasuries, not including the taxes paid by indirect and induced industry employment. 

The industry is the largest net exporter, and one of the largest contributors to our nation’s gross exports at $89.6 billion, with a larger portion made up of commercial aircraft bound for foreign carriers. The industry’s
contribution to the nation’s GDP is 2.23%, and as described below, we conclude the industry “punches above its weight,” when considering other beneficial and qualitative impacts to our economy beyond these metrics.

Indeed the industry contributes in ways not directly included in GDP, employment, and taxes paid. Although it has only been 108 years since the Wright Brothers’ first flight, the industry has contributed fundamentally to the way we live, work, travel and communicate with the technology created and continued innovations in jet aircraft, communications satellites, the internet and Global Positioning Systems (GPS), for example. Also, the industry is primarily
responsible for the reduction of casualties in armed conflict due to the technology innovations that keep our warfighters out of harm’s way with unmanned aircraft, sophisticated surveillance sensors and over the horizon strike capability.

Current economic challenges resulting in defense budget declines may impact direct and indirect employment, ability to conduct research and development, and taxes paid. On the other hand, the current up-cycle in commercial aircraft production, thus employment, portends years of future growth potential. However, due to its weighting, the uptick in commercial aircraft production is not expected to make up for the shortfall in overall industry revenues and
employment due to the size of the pending defense downturn.

This study demonstrates the significant economic and financial contributions made by the aerospace and defense industry, and its broader impact on our society. These will be important considerations as constituents assess the impact of changes to investments in research and development and the industrial base, and the continued ability of the industry to create the next generation of game changing products and services.

Human Capital Management

This report provides a framework of Key Performance Indicators (KPI) for an organization to assess its ability to retain the critical knowledge that it needs, both internally and within its supply chain. It is recommended that an enterprise should assess its maturity against the KPIs and establish the level of capability that is required to effectively manage its risk as identified by internal business process requirements or mandated by contractual obligations.

Best Practices for Exploiting the Consumerization of Information Technologies

The nature of the aerospace and defense business implies that the industry is one of the most severe test cases for the effective deployment of new consumer devices, virtualization of storage and processors and Internet connectivity. These guidelines describe best practices for companies to assess the risks involved in exploiting new technologies and capabilities within their business, and to operate such equipment to deliver benefits.

Policies and Codes of Conduct for the Use of Social Network

This document recommends templates for the policies and codes of conduct that companies should apply to their employees’ use of social networking tools, depending on whether those tools are hosted in a private, community or public environment. The recommendations are based on best practices from member companies.

Industry Task Force Paper: Defense Executives Assess Business Impacts of Major Budget Cuts

Industry Task Force Paper: Defense Executives Assess Business Impacts of Major Budget Cuts

The $480 billion in additional budget cuts projected over the next decade could cripple certain defense sectors, resulting in an industrial base that is smaller, less innovative, and less responsive to urgent wartime needs.

The Case for a Defense Industrial Strategy

The defense industrial base is a national strategic asset that has provided the United States with a marked advantage in defense technology for more than six decades. But that asset — the intellectual capital and production capacity of aerospace and defense manufacturing — is at risk of atrophying to a point where it will not be able to provide the weapons systems this country needs in the future.

Counterfeit Parts: Increasing Awareness and Developing Countermeasures

Counterfeiting has a long and ignoble history, ranging from art and literature to manufactured goods. Unlike other industries, counterfeiting in the aerospace industry may have life or death consequences. We take the problem seriously. Thus, all stakeholders from industry and government must work together to effectively reduce the introduction of counterfeit parts into the aerospace supply chain and minimize their impact.

Acquisition Policy Changes: Impacts on Contract Profitability

Acquisition Policy Changes: Impacts on Contract Profitability

Federal acquisition policy expressly recognizes the importance of the contractor’s ability to earn reasonable returns on business with the Government. Recent acquisition trends and policies, however, have attacked the profit and fee portions of contractor’s prices, either through the elimination of fee on certain cost elements or by negotiation strategies impacting overall returns on government contracts.  Industry believes acquisition trends focused on elements of profitability, including changes to contract cash flow and policies for R&D funding, will have negative consequences for the Government and the nation as a whole as contractors and investors move resources away from unprofitable government business.

Disruptive Information Technologies

Disruptive Information Technologies

This report is an initial statement of the likely impact of these technologies and the business, technical, cultural, operational and security implications for our industry. The key characteristics of each technology are described in the following sections along with the claimed benefits, risks and mitigations. Each section provides recommendations to help companies exploit the technologies and proposes supporting actions where it is appropriate for the AIA to act on behalf of the industry.

Reliability Assessment of Lead-free Electronics in the Aerospace, Defense ...

Reliability Assessment of Lead-free Electronics in the Aerospace, Defense ...

The Lead (Pb)-free Electronics Risk Management (PERM) Consortium recently released the following white paper entitled “Reliability Assessment of Lead-free Electronics in the Aerospace, Defense and High Performance Electronics Industries.” The White Paper states that it is premature to rely solely on known reliability standards for qualification of systems containing lead-free assemblies in critical, high-reliability, harsh environment applications without rigorous assessment of application requirements.