Op-Ed: In Shipbuilding, Don’t Confuse Efficiency with Effectiveness

 

We often hear the terms used interchangeably, but doing things right (efficiency) is not the same as doing the right things (effectiveness). True success in complex industries like shipbuilding and maritime operations demands alignment between the two. Yet in practice, that alignment is rarely achieved and often confused as one driving the other.

Focusing on data, as leaders we track cost-per-unit, man-hour ratios, and schedule milestones and while these are important, these are known process metrics, not outcome indicators. It’s entirely possible to deliver a ship “on time and on budget” and still fail the mission if it can’t sail, can’t be maintained, or is delivered to an understaffed fleet.

Below are three common traps that erode effectiveness, even in the pursuit of efficiency.

It’s Not the Talent. It’s the Team.

A Chief Engineer once told me, “If I just had better trained people, I could finally fix this place.” Any Sailor worth their salt knows: it takes more than individual competence to get a complex system working. It takes a functioning team. While training is important, individuals can win a battle, but teams win wars.

Effective leadership isn’t about cherry-picking talent; it’s about cultivating team effectiveness. Building trust, purpose, and cohesion, that’s where sustained productivity is born. Once you’ve built the team, then you can drive efficiencies. Forming, storming, norming, performing… and yes, reiterating the cycle. For those that recognize the quote, “It gets easier. Every day it gets a little easier. But you gotta do it every day. That’s the hard part.”

It isn’t dollars that make cents. It is dollars that make sense.

Despite the Navy doubling its shipbuilding budget over the last 20 years, fleet size has flatlined and our known problems have exacerbated. In 2024, the GAO reported up to 3-year delays in ship deliveries and an estimated 46% (known) shortfall in effective output per dollar spent, adjusted for inflation.

Why? Because money alone doesn’t build ships.

Two structural issues remain unaddressed (as noted in the same report):

• Infrastructure bottlenecks: Many shipyards physically lack the space and tooling to handle the current or future workload.
• Workforce deficits: Even where facilities exist, skilled labor is in short supply. Production timelines are slipping due to workforce attrition, training gaps, and overreliance on overtime.

Ask any economist or professional estimator: appropriations without investment in people and capacity don’t solve the problem, they just inflate the baseline in cascading estimates and award.

Conglomeration Chokes Competition

The U.S. maritime sector, like many industries of our economy, has quietly consolidated into a few mega-firms. In the case of Navy shipbuilding, reduced competition has resulted in an extreme case; a non-functional duopoly:

• Huntington Ingalls Industries (HII): Formed from Northrop Grumman’s shipyard spin-off, HII now commands over 50% of Navy shipbuilding contracts, with a 2023 backlog of $49B.
• General Dynamics (GD): Through Electric Boat, Bath Iron Works, and NASSCO, GD builds nearly all submarines and destroyers another 45–50% share.

That leaves just 10–15% of the market to all remaining players combined (Fincantieri, Austal USA, Bollinger, and Vigor (Titan)). As Rear Admiral Matt Lake recently put it best, we face entrenched “barriers to entry, lack of a supplier ecosystem, and monopolistic practices born of decades of consolidation.”

This isn’t just about cost, it’s about capacity, agility, and resilience. A market of two cannot surge, innovate, or adapt fast enough to meet today’s threats.

So, What Now?

We have the talent. We’ve diagnosed the problems. We need action.

Policymakers must distinguish effectiveness from efficiency and stop mistaking full budgets for full readiness (of which we have neither, but that is another post). The maritime sector is not just about ships, it’s about national security, economic mobility, and industrial leadership. China now commands 51% of global shipbuilding; the U.S. needs more than spreadsheets to compete.

Never one to follow but a country that leads, we must:

• Rebuild competitive industrial capacity
• Channel dollars toward workforce and infrastructure
• Develop metrics that measure effectiveness, not just execution

Make no mistake, none of this is easy. But if we are serious, and I believe we are, that’s how we restore strength to America’s shipbuilding backbone.

See you on the deck plate

Benjamin Miner is a licensed professional mariner with more than 25 years in industry, both at sea and on shore. He has been a resident of Hampton Roads since 2017, where he lives with his wife and son.