Rep. Mac Thornberry’s much-anticipated defense acquisition reform bill makes considerable strides toward disrupting a procurement process that is widely considered broken, but the bill is far from a fix-all.
Titled “Agile Acquisition to Retain Technological Edge Act,” the bill by the House Armed Services Committee chairman synthesizes more than 1,000 proposals from an eclectic mix of Hill staffers, think tankers, industry experts and Pentagon brass.
The bill begins by attempting to improve the skills of acquisition personnel. In the same spirit as Rep. Thornberry’s March 23 remarks at CSIS, it strikes widely, by permanently extending the Department’s Workforce Development Fund; and narrowly, by directing greater training resources towards building expertise in market research. It also strengthens the foundation of the “dual-track career path,” a valuable staffing strategy that allows military personnel to pursue a primary career in combat arms and a secondary career in acquisition. Guided by this language, the system should see a much-needed injection of human capital.
Rep. Thornberry commits an entire section of the bill to identifying and eradicating bureaucratic muck. Demonstrating his conviction that “paperwork” is a major enemy of efficient acquisition, the bill would repeal 45 reports in part or in full, ranging from healthcare-related documents to shipbuilding and airlift protocols.
In another bold and appropriate move, the bill wages a pointed assault against the inefficiencies around “program initiation.” At the start of development, DoD program managers are frequently buried under ill-defined requirements, and given insufficient resources to figure out how to best get off the starting block. Though the onus inevitably will fall on acquisition professionals, not legislators, to operationalize this guidance, removing paper and directing greater attention to the first leg of the race are valuable steps.
The bill gracefully walks the line between risk aversion and risk tolerance. We have advocated the broader endorsement of productive failures”—or calculated risks—which can drive innovative practices while keeping an organization out of grave danger. Along these lines, the bill offers a thoughtful risk-mitigation approach built on competitive prototyping and a multi-faceted risk management strategy. But it also suggests holding less tightly to the status quo; for example, it criticizes the fact that “customary approaches and suppliers are preferred over perceived risk of new or unique concepts and vendors.” Giving teeth to this sentiment, the bill prudently raises the Simplified Acquisition Threshold from $100,000 to $500,000, opening up an expedited development path to a far larger community of acquisition programs.
For all of its progressive energy in certain areas, Rep. Thornberry’s bill misses the mark elsewhere.
Nobody can dispute the necessity of strategy, yet the bill’s approach to promote a more strategy-driven acquisition function is rather stale. The bill requires major defense acquisition programs to have an “acquisition strategy,” but most already do. Programs of Record (PORs) must track to an Acquisition Program Baseline (APB), and even some non-POR programs employ strategic frameworks, such as the Execution Program Baseline, a tool similar to the APB used by the Army’s PEO for Enterprise Information Systems. Rather than driving marginal gains at the surface, the bill could have attacked the root of the problem: budget uncertainty. A common theme voiced to us both by acquisition professionals and issue experts outside the Pentagon is that strategic planning is nearly impossible when you do not know where your dollars will be coming from, or if they will be coming at all.
At CSIS, Rep. Thornberry stressed his desire to make the DoD “the fastest integrator of commercial technology” in the federal government, but the scraps of new thinking in the bill on the subject are disappointing. It suggests that using more commercial off-the-shelf (COTS) technology would make development faster and more flexible, which is spot-on, but offers little detail on what incentives decision-makers might use to drive the use of COTS. Even more discouraging, COTS is only mentioned in the context of business systems despite its broader value in weapons development and other types of tactical technologies. Additionally, the bill practically ignores the challenges associated with 21st-century system integration. As one former Deputy Secretary of Defense told us, more and more materiel is software-intensive; the age of traditional, discrete systems has surely given way to the rise of systems of systems. Breaking Defense notes that Rep. Thornberry was going for the “lower-hanging fruit,” so these complex questions around system integration may find answers in the next round of reform, but the decision to gloss over this increasingly important issue is disconcerting.
The choice to avoid service acquisition to focus just on weapons and business systems was deliberate, but odd. Historically, services contracts have comprised over half of DoD contract spending and nearly a third of the overall budget. Additionally, though the primary focus on “program initiation” is appropriate, completely ignoring the protocols and policies around sustainment was not. Operating and support costs typically comprise 70 percent of the total lifecycle cost of a weapon, and sustainment costs are rising. It is becoming increasingly important that program managers incorporate sustainment into their acquisition strategy from the start. And finally, the near-exclusive focus on small business in the bill’s “industrial base” section sidesteps the variety of other systemic issues that plague the defense-industrial complex. Though more reform bills are surely in store, excluding policy recommendations around improving communication with industry partners—big and small—is unfortunate.
Though this bill is a commendable first pass at defense acquisition reform, Rep. Thornberry may be playing on borrowed time. The “triumvirate” of Defense Secretary Carter, Deputy Secretary Bob Work, and Under Secretary for Acquisition Frank Kendall are likely to exit in the next two years, well short of this story’s final installment. Though this bill would nudge the system in a positive direction, it may ultimately make it only slightly less “reactive, plodding, and opaque.”