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Air Force Speeds Up Space Acquisitions


(Breaking Defense) The Air Force, eager to get inside the decision cycle of China and Russia, is pressing ahead hard and fast to substantially speed space acquisition.

In what is something of a test case for the service, Air Force Secretary Heather Wilson last night committed to building the next generation of missile warning satellites, OPIR, in five years. The existing SBIRS satellites, after years and years of delays and cost overruns,  still take nine years to get into orbit.

To get the birds into space more quickly, Wilson told reporters before an after-dinner speech that they will use “known sensors” and a commercial satellite bus. On top of those capabilities, Wilson said they “may have” defensive capabilities, carry more fuel and and more maneuverable so they can fight (defensively) in space if the need arises.

This is clearly a new standard for American military satellites: build them so they can defend themselves. Why? As Wilson put it in her speech here: “We built exquisite glass houses in a world without stones.” Today, the Russians and Chinese are building stones and appear ready to use them.

Another key to achieving this will be substantial change to how Space and Missile System Center, the people who buy the Air Force’s satellites and related launch systems, does its job. Wilson told me they will break apart the familiar vertical stovepipes — which govern position and timing, space superiority, and remote sensing — and create a new structure. There will be a production corps and a development corps that will function across multiple programs, she said.

The initial reorganization will be done by October, Wilson said.

Why is the Air Force trying to get these sophisticated satellites into space in five years?

Will Roper, new head of Air Force acquisition and former leader of the Pentagon’s Strategic Capabilities Office, told reporters it is “aggressive goal,” one they set because things wouldn’t happen faster unless, in effect, they said they would. He made clear we’ll see more such stuff goals set for Air Force acquisition programs. Prototyping should help get these birds into space more quickly, he said. That will help weed out the incompetent and the slow. “We want to not be afraid,” he said. Of course, my self and a host of other reporters and congressional aides and erstwhile experts will be watching closely, ready to point fingers should this not happen.

Bear in mind that it’s not entirely clear when those five years start– after companies build prototypes and the Air Force picks a winner or….?

But the senior Air Force officials really are trying to change what they see as an often crippling culture that punishes failure and spend years trying to figure out why something failed, instead of just fixing it and getting on with things.

On top of the SMC changes, a new office is being stood up to work with Roper to “rewire” the acquisition system and make current procedures, that require dodging the slower bits of the acquisition system, standard practice. It will “work with program managers to identify areas for streamlining and improvement,” an Air Force statement says.

“Their job,” Wilson said in her speech, “is not to buy things but to change the Pentagon rules on how we buy things so that speed is possible.”

Will these changes blow my or others socks off, as Secretary Wilson boldly claimed? Let’s hope so.

By COLIN CLARK for Breaking Defense

on April 18, 2018 at 4:00 AM

Fire Them: Sen McCain Wants to Hold Defense Officals Accountable


(Military.com) The chairman of the Senate Armed Services Committee is playing hardball with the Pentagon when it comes to acquisition programs that end up billions of dollars over budget or deliver years late.

In a hearing before the committee Thursday, Sen. John McCain took to task Ellen Lord, the new under secretary of defense for acquisition, technology and logistics, for recent examples of acquisition malpractice, including the Army’s Future Combat Systems and the USS Gerald S. Ford, the first of the Navy’s new class of supercarriers.

FCS was canceled in 2009 after six years of work and more than $6 billion in taxpayer investment; the Ford was delivered earlier this year, more than $2 billion over budget and 15 months later than expected.

McCain said he asked Chief of Naval Operations Adm. John Richardson who was responsible for cost overruns and was told Richardson didn’t know.

“I mean, there’s such a thing as accountability, and all of the things that were just covered by the witnesses here … there’s no penalty for failure,” the Arizona Republican said. ” … When I go to a town hall meeting and tell my constituents that we blew $6 billion and there has not been anyone fired or replaced or — or — or new way of doing things, they’re not really very happy.”

Lord declined to talk about specific personnel actions in an open hearing, telling McCain she preferred to discuss the matter privately in his office.

“We, as a team, are working very closely together to look at functions and individuals in OSD and in the services, the duties they’re required to perform,” she said, “and are determining whether or not we have the right people in the right slots, and I don’t want to talk about individuals here in a broad forum.”

Army Secretary Mark Esper, who also testified, was more direct.

“Senator, I’m not aware of anyone being fired for FCS, to your point,” he said.

McCain has been a longtime critic of a number of major defense acquisition programs that saw large cost overruns or failed to live up to their initial promise.

On Thursday, he said the F-35 Joint Strike Fighter program, now with a $1 trillion lifetime cost, still “operated in dysfunction,” and other programs, such as the Army’s Warfighter Information Network-Tactical, still didn’t work as planned.

“That’s why this committee enacted the most sweeping acquisition reforms in a generation through the last two National Defense Authorization Acts,” he said. “And yet, despite that legislation, and in the face of our eroding military advantage, the department has been unable or unwilling to change.”

Lord, who previously served as CEO of Textron Systems and assumed her current position in August, told reporters following the hearing that she expects to address personnel issues going forward, though she may not reveal all actions to the public.

She added that she is prohibited by law from making any personnel changes or reassignments in the first 120 days of her tenure. That milestone, she added, has only recently passed.

“I think you should expect to see some movements,” she said.

From Military.con By Hope Hodge Seck

Visit Website HERE

Pentagon: Bureaucracy in Chief


(DOD Buzz, 30 Jan 18) The Senate Armed Services Committee approved by voice vote Tuesday, and sent to the floor for quick action, the nomination of John H. “Jay” Gibson II as the Pentagon’s first “chief management officer [CMO]” with a mandate to shake up the bureaucracy.

“This goes to the fundamental restructuring of the department,” Deputy Defense Secretary Patrick Shanahan told defense reporters last month in anticipation of the confirmation of Gibson, a former assistant secretary of the Air Force and former chief executive of XCOR Aerospace.

“Congress has written in the law many, many times that we need to have a chief management officer,” Shanahan said, and “a good portion of Jay’s responsibility is going to help us transition organizationally and technically.”

Under a re-organization plan approved last August, the new post of CMO will have major responsibilities in the areas of logistics and supply; real property; community services; human resources; health care; and technology systems.

Shanahan, a former Boeing executive, said he expects Gibson will get pushback in all those areas from the entrenched bureaucracy.

“You’ll probably hear screaming and yelling” because of the belief among some career officials that “change is bad,” Shanahan said.

However, “if you’re going to have a more performance-driven operation, you have to unwind the bureaucracy and reorganize,” he said.

Gibson is also expected to have major input in how the Pentagon overhauls the process by which the military buys and develops weapons when the split of the DoD’s Office of Acquisition, Technology and Logistics (AT&L) takes place next month.

Under the National Defense Authorization Act of 2018, which is still bottled up over Congress’ failure to reach a budget deal, AT&L is slated to be broken up in February to create a new undersecretary of defense for research and engineering (R&E)) and a new undersecretary of defense for acquisition and sustainment (A&S).

In the lead-up to passage of the NDAA, Sen. John McCain, R-Arizona, chairman of the Senate Armed Services Committee, and Rep. Mac Thornberry, R-Texas, both argued that splitting AT&L is vital to streamlining the cumbersome process of getting new weapons and technology into the hands of warfighters.

Shanahan said he expects Gibson to make changes in how the DoD operates that could not be undone by future administrations.

“We want to make sure that with the stroke of a pen or a few clicks of the keyboard, we can’t undo progress,” he said. “When you think about enduring change, you have to wire or alter the work so that you don’t regress. That’s the hard part about big bureaucracy — is making enduring change.”

Military.com

, 30 Jan 2018, By Richard Sisk

Congress, Let Defense Innovators “Breathe Free”

The article below is written by Army Col Richard Hough, who is a senior strategic study fellow in the Army Future Studies Group, gives an in-depth analysis on what’s wrong with the defense acquisition system and how to improve it. I agree with all the conclusion the Col makes in his article, particularly with the need for more rapid decision making. I still believe the fundamental problem with the acquisition community is that Sr. Leadership lack a basic understanding the process. If you don’t understand the basic fundamentals of the process, you can never lead the acquisition community and reform the process. They believe the process is the problem, not them.


(Breaking Defense) America’s defense industry is struggling to boost its innovative entrepreneurs, who need freedom and resources to come up with creative ideas.

Unlike other industries, defense innovators do not benefit from capital incentives to encourage research and development investment. Instead, innovative defense concepts have traditionally been nurtured in an environment combined of countercultural activity, legislative prompting, necessity (often fear), re-orientation and re-organization; which are rarely effective when implemented in isolation. Outlined below is a summary of the current state of the defense acquisitions system and how Congress must help us overcome the status quo.

During the interwar period, George Orwell noted “We have now sunk to a depth at which restatement of the obvious is the first duty of intelligent men.” In that vein, let’s look at defense acquisitions and congressional oversight. It is obvious that:

  • Decades of tweaking the system based on the limited findings of panels and oversight committees has resulted in no perceptible cultural change.
  • We do not use our broader cultural strengths and corporate traditions to inform acquisition policy.
  • We have lost sight of long-term and emergent threats while becoming overly focused on current contingencies.
  • Appropriations and regulatory requirements have created a consensus-based decision-making environment that is risk-averse.
  • The acquisition workforce understands that excessive layers of bureaucratic review provides protection from direct accountability.

What is less obvious is whether or not Congress understands its contributions to defense acquisition shortcomings and the resulting dilution of authority and accountability.

No Perceptible Cultural Change 
The 2017 National Defense Authorization Act told the Pentagon to split the undersecretary of acquisition, technology and logistics into two separate jobs: undersecretary for acquisition and sustainment; and a new undersecretary for research and engineering (R&E). The new offices, particularly the R&E, are intended to increase innovation and “change the culture.”

James O’Bryon, former deputy director of Operational Test and Evaluation, questioned whether this was the best approach, essentially taking us back 40 years ago when the Pentagon had essentially the same setup: “I’m not sure, however, that returning to where we were in 1986 is the total answer.” O’Bryon ponders, “So what are we possibly missing in this process as it grinds away?” I would answer that what is missing is honest self-reflection within Congress on its contribution to sustained cultural influences within the acquisition system.

Our Broader Cultural Strengths 
Congressional testimony and defense reports have noted that government constraints on profit margins have compromised acquisitions because, “culturally, we have evolved to a point where the system would rather pay $1 billion and 5% profit for a defense good, than $500 million and 20% profit” from a more innovative supplier.

Overhauling the Code of Federal Acquisitions Regulations (FAR) is overdue. The FAR seeks to promote an accountable system that protects U.S. taxpayers, but it has become the epitome of a bureaucratic risk-averse culture that undermines innovation, partnerships, accountability, and fiscal responsibility.

Congress expects the services to improve relationships with existing and potential defense industry partners, but corporate and government regulators must translate “up to 186,000 pages with over 2,000 pages” added annually by various federal departments.

As a result, current defense firms have traditionally focused their innovation delivery models simply on meeting what the government wants. But what if what the government wants isn’t what it needs?

According to John Kenkel and Andrew Jesmain, of PA Consulting Group, this creates problems:

First, industry has not been incentivized to create new ideas and must deliver solutions defined by the customer, who often lacks awareness or understanding of the array of solutions industry is capable of providing. The result of this paradox is a laundry list of programs and solutions that have been over budget, delayed or canceled outright. Second, this reality creates a sharp contrast in approaches to research and development that differentiates defense firms from their commercial counterparts.

For the Army, these “failures” have cost tax payers billions and are the most obvious reason why oversight is overly centralized. Since 2011 alone, the Army has ended 20 programs, delayed 125 and restructured 124 others.
Figure 1: Major Army Defense Acquisition Programs Cancelled

While acquisition decision-making must improve, sequestration and the focus on present operational requirements hasn’t encouraged bold decision-making on new program initiation either. Plagued by bureaucracy, budget cuts, and canceled programs, mounting legacy equipment costs, and the lack of a major operational concept for over a decade, the Army just doesn’t know what to ask for.

Until the service explores the art of the possible with Congress, industry, and academia, requirements will “have — far too often — proven too ambitious, too expensive or too inimical to innovation.”

Meanwhile, the Pentagon has used various non-traditional acquisition approaches — Section 804 Middle Tier Programs — to avoid establishing new long-term acquisition programs. However, Congress is concerned with the near-term productivity and value of such programs. Unfortunately, where their scrutiny should lie is on the impacts on basic research and how such programs sustain long-term overmatch capabilities.

Losing sight of long-term threats
The good news is Army executives are embracing change. Thomas Russell, deputy assistant secretary for research and technology, says he’s seeking “innovations from industry and other partners wherever possible” to guarantee success of the “most important” acquisition programs. Acting Army Secretary of the Army Ryan McCarthy says that, “the Army must also focus efforts on modernizing today to be ready to fight tomorrow, against increasingly capable adversaries and near-peer competitors”. But any attempt to channel near-term innovation delivery into a disciplined long-term strategy is shortsighted.

Why?

At this juncture, when 25 percent of Army acquisition spending is invested in pre-1991 programs and 55 percent in 1991-2001 programs, near-term program changes cannot overcome the lack of a long-term strategy. The “most important” thing the Army can do is to work with Congress to fund a long-term strategy.

Over the last 15 years, the Army has prioritized near-term readiness and equipment needs to combat non-state actors. This has limited its ability to modernize so it can engage in high-end  combat against near-peer challenges.

Meanwhile, the Army is facing increased sustainment costs and reduced funding for concept development and new programs. In turn, major program failures have undermined the Army’s ability to: encourage innovation by major defense partners; solidify a strategic concept; and, formulate consensus on a long-term procurement strategy. If the Army maintains this “demand pull” approach, over an extended period of time, the “likelihood of generating disruptive capabilities” will decline and lend itself to fear-based decision-making in the future.

A Risk-Averse System
In the 2016 NDAA, Congress established the Section 809 Panel whose initial findings include identified influences that Congress must reflect on if real progress is to be achieved.

As an independent panel with credible qualifications, Section 809 Panel has described in their initial report that those operating within the system respond to Congress in ways that Congress fails to recognize or appreciate. Overly complex laws and regulations result in suboptimal risk-averse decision-making. Excessive hearings on non-traditional acquisition pathways have undermined prototyping of new systems; buying commercial off-the-shelf items; and created cultural barriers that undermine technology companies from working with the DoD. And, the “acquisition workforce understands congressional intent thru bureaucratic reviews, budget cuts, hiring freezes, salary freezes, furloughs, continuing resolutions, sequestration, hearings, and statements that it must change.”

While Section 809 Panel has found several other shortcomings and conclusions unrelated to Congress, its final report, due early next year, can highlight that cultural change must start at the top.

Bureaucratic Review Shields Failures From Direct Accountability
Within the acquisition enterprise decision-makers have multiple layers of bureaucracy and accountability. A single Army decision may cross four multi-star organizational boundaries and be subject to 10 flag officer reviews. The requirement is generated by one TRADOC organization, ranked by another, and then transmitted by a third, before senior Army officials review it during three committees.

Why? The obvious answer is a lack of trust and misplaced values imposed at the top of the acquisitions enterprise – authorizations and appropriations.

Overly Prescriptive Laws Undermine Trust
In an effort to highlight how present legal constraints undermine the miltiary’s ability to leverage corporate advantages or to seek disruptive technologies, let us review Section 219 of the 2017 NDAA.

DoD lab directors are permitted to use not less than 2 percent but not more than 4 percent of all funding available to the lab for “off-roadmap”, or disruptive, technologies, according to Section 219, . While the authorities may be helpful, those funds are rarely used because they are only a fraction of those required for bold initiatives without having to seek outside funding — often from PMs — where other priorities and funded near-term concepts trump untested concepts.

Various studies have recommended increasing lab directors’ flexibility and Congress improved a previous 3 percent cap to 4 percent. But we will fall further behind civilian researchers and potential competitors unless we think more creatively.

CONCLUSION
Congress must clarify the long-term concepts and acquisitions strategies governing DoD weapons buying. Once they are better defined, congressional oversight can then lend itself to overcoming sustainment engineering of existing legacy systems and the risk-averse culture that maintains it.

Additionally, Congress should implement “succeed-fast” and “fail-fast” policies regardless of a system or subsystems Technology Readiness Levels (TRLs). A principle reason why Section 804 innovation initiatives remain relevant is that they are one of the few means available for maturing technologies along such lines. If “fast-fail” policies had been applied to long-term programs the Army might have avoided the numerous failures of major acquisition programs over the last two decades.

Also, Congress should

  • Identify and eliminate internal influences affecting DoD’s risk-aversion culture.
  • Eliminate line item acquisition funding. Retract or cut FAR, eliminate statutes, and reform NDAA development processes.
  • Incentivize corporate and defense decision-making to drive modernization concepts and capabilities development.
  • Increasing lab director authorities to fund disruptive programs.
  • Return acquisition funding to historical norms, and, program for multiple years. Expand limits imposed on acquisition funding authorities across the board.

As we move forward into the twenty-first century, we must put twentieth century bureaucratic practices behind us. In a more complex world trust is the only means of establishing an acquisition and defense strategy capable of avoiding the “we aren’t fearful enough” drumbeat for defense innovation. Like other industries, defense acquisition innovation must recognize that “inspiration flows best when individuals ‘can breathe free,’ thinking creatively without limits of fear.”

Army Col. Richard Hough is a senior strategic study fellow in the Army Future Studies Group. The opinions, conclusions and recommendations are those of the author and do not reflect the views of any entity of the U.S. government.

Senate Ask Pentagon for List of Damage from Continuing Resolution

(The Hill) Senate Armed Services Committee leadership want fellow lawmakers to be very aware of the affects an incomplete fiscal 2018 budget will have on the military.

Sens. John McCain (R-Ariz.) and Jack Reed (D-R.I.), the committee’s chairman and ranking member, on Tuesday asked Defense Secretary James Mattis to prepare a list of the damage a three- and a six-month continuing resolution would have on the Pentagon.

A continuing resolution, which freezes current funding levels and prevents any new programs from starting, “will result in billion of dollars in cuts to the defense budget from last year’s level — cuts that the Department of Defense can ill afford at a time of diminished readiness, strained modernization, and increasing operations,” the senators wrote in a letter released Wednesday.
McCain and Reed want the list by Sept. 8, saying “we believe it would be prudent to have a concrete understanding” of a continuing resolution’s impact on military branches, defensewide agencies and combatant commands.

Lawmakers return from August recess next week to tackle the fiscal 2018 National Defense Authorization Act (NDAA) before the 2017 budget expires on Sept. 30.

The Senate is expected to consider the NDAA shortly after it returns.
“Given the limited remaining work period for both the House and Senate prior to October 1st, and the difficulties of negotiating and enacting a major bipartisan budget agreement, it is very likely that the federal government will begin the fiscal year on a continuing resolution yet again,” the two wrote.
Mattis has said that passing a continuing resolution is “about as unwise as can be,” because frozen spending levels affect military readiness.

Less Acquisition Reform: Focus On Fundamentals

(Breaking Defense) Once again, America faces the prospect of a budget showdown come September. Defense companies are getting ready for the possible disruptions that attend. And, of course, Pentagon budgeteers, led by new Deputy Defense Secretary Patrick Shanahan, are rebuilding the fiscal 2018 request and preparing for disruption to the last of the 2017 spending. One of the canniest acquisition experts around, Terry Marlow, penned this piece for us trying to look beyond today’s budget disruptions and addressing that wonderful old chestnut, acquisition reform. Does reform matter as much as realistic budgeting? Marlow was senior advisor to former Air Force Secretary Michael Donley; before that he handled acquisition policy for the powerful Aerospace Industries Association. What’s his argument?

When corporate CEOs talk about concentrating on improving “blocking and tackling,” they are referring to getting business fundamentals right. They have found that if their companies can’t perform the fundamentals well, there is little else that can be done to ensure success. The same is true in the federal government. Any organization seeking better performance must first concentrate on getting the “blocking and tackling” right.

Terry Marlow
DoD just doesn’t seem capable of focusing on acquisition “blocking and tackling.” After decades in the works, defense acquisition reform long ago reached the stage of diminishing returns. Each new round results in the acquisition process becoming more complex, cumbersome and inflexible. There has been no corresponding long-term improvement in cost, schedule and technical performance. DoD needs to go back to square one and get the fundamentals right.

Continuous review and adjustment of the acquisition process has become a cottage industry that produces tinkering, but little discernible progress toward “better, faster, cheaper.”  This tinkering should be throttled back and the existing process given a chance to work undisturbed while renewed focus is placed on a few fundamentals.

Having trained and experienced experts in acquisition leadership positions is the most important fundamental to successful military acquisition programs. We’ve made progress, but continued emphasis is needed to ensure successful recruiting and retention of world-class experts.

Just as fundamental is realistic budgeting that must be accompanied by long-term budget stability. However, budget realism has been a well-recognized failure in defense acquisition since the early days of the modern acquisition reform movement. In the early 1980s, former Defense Secretary Frank Carlucci referred to this problem as a failure to “budget to most likely cost.”  At the time, many believed cost growth was the result of inaccurate cost estimating and poor program management. However, what was perceived as cost growth was usually the result of deliberate underfunding in an effort to squeeze more programs into the limited budget. Later, when the budget was inevitably exceeded, the illusion of poor management and cost growth was created.

Experience has demonstrated that seeking to force down budgets and accept increased cost risk to enable the funding of additional programs is a flawed strategy that should not be tolerated.  When program managers are handed inadequate budgets, the result is usually increased technical problems, increased schedule slips, and increased costs as they try to manage programs within the constraints of inadequate budgets. Unfortunately, by the time the true costs become apparent, the decision-makers have moved on and their successors are left to deal with the “cost growth.” That usually means increasing the budgets to more realistic levels.

Underfunding of programs and the resulting budget overruns go beyond damaging individual programs. The associated publicity undermines public confidence in the entire defense acquisition process, and, I believe, it can also foster public doubt in the military’s ability to carry out its broader responsibility – its warfighting mission.
The United States is about to enter another cycle of tough debates over military budgets as demand for federal funding for non-defense programs grows and rising interest rates take a bigger bite from the annual budget top line to pay the costs of the national debt. It is a problem that is likely to worsen as the nation faces increasing demands for re-capitalization and modernization of military hardware necessary to fend off military threats after 15 years of war.
Competition for federal funds will once again bring decision-makers face to face with the pressure to lower budgets for individual military programs. The Pentagon must focus on sound “blocking and tackling,” and resist the pressure to underfund these programs. Business as usual will jeopardize the success of acquisition reforms and endanger U.S. national security.

By Terry Marlow

Visit Article: (HERE)

When Amazon Meets Defense Acquisition

(Government Executive) Unanswered questions persist about a House provision to allow Pentagon buyers to use proprietary online sales platforms.

Imagine simply flipping open your laptop, firing up your desktop computer or popping open an app on your mobile phone to order office supplies, equipment, or even contract services Amazon-style, two-day delivery included.

That day may not be too far off if a provision in the House version of the annual National Defense Authorization Act makes it into law.

The prospects for commercial online marketplaces in government got a lift in mid-July, when Alan Thomas, the Trump administration’s new chief of the General Services Administration’s Federal Acquisition Service, gave an enthusiastic thumbs-up to the proposal that his agency engage online marketplaces for all agencies to use.

The idea is ensconced in the House-passed version of the 2018 NDAA, which contains policy and suggested budget toplines for the Pentagon. The Senate Armed Services Committee’s version of the bill does not include the online marketplace provision, and it awaits a full Senate vote in September, after the August congressional recess.

The marketplace provision leads Section 801 of the House NDAA and originally was introduced as separate legislationby House Armed Services Committee Chairman Mac Thornberry, R-Texas. His version was Defense-only, but, in committee that vision was enlarged to encompass all of government with GSA as the lead. GSA has been working closely with Thornberry on the bill, according to a report from Federal News Radio.

Continue reading (HERE)

by Tim Cook