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Case
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Reference no. HKS0806.0
Published by: Harvard Kennedy School
Published in: 1987
Length: 15 pages
Notes: For terms & conditions go to www.thecasecentre.org/freecaseterms

Abstract

One of the explanations often given for the high cost of military hardware is the fact that many items of military equipment are built in such small quantities that the Armed Forces do not benefit from the economies of scale that keep prices down in the commercial world. Unfortunately, the alternative of buying equipment 'off the shelf' is not as easy as it might seem. Army equipment must perform in an environment where the enemy is actively trying to destroy it and must therefore have certain peculiar military features. Obtaining these special features while also taking advantage of the economic benefits of 'off the shelf' purchase was the challenge faced by Major Lawrence Day of the US Army Tank Automotive Command when he was assigned to buy 55,000 commercial trucks for the army. Fulfilling this mission would require that Day reconcile the practices of the auto industry with the requirements of the army bureaucracy.

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Abstract

One of the explanations often given for the high cost of military hardware is the fact that many items of military equipment are built in such small quantities that the Armed Forces do not benefit from the economies of scale that keep prices down in the commercial world. Unfortunately, the alternative of buying equipment 'off the shelf' is not as easy as it might seem. Army equipment must perform in an environment where the enemy is actively trying to destroy it and must therefore have certain peculiar military features. Obtaining these special features while also taking advantage of the economic benefits of 'off the shelf' purchase was the challenge faced by Major Lawrence Day of the US Army Tank Automotive Command when he was assigned to buy 55,000 commercial trucks for the army. Fulfilling this mission would require that Day reconcile the practices of the auto industry with the requirements of the army bureaucracy.

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