This is part of IEEE Spectrum's Special Report on What's Wrong with Weapons Acquisitions?
Unlike the commercial sector, the defense business does not operate in the free market. In a free market system there are many buyers and sellers, and prices and profits are based on agreed exchanges of risk and opportunity among the parties. In the defense sector, there is one customer—the government—that dictates price, profit, risk, and opportunity for anyone who wishes to sell to it. A defense company can’t decide on its own to make a tank or a fighter jet and then offer it on the open market.
But a government is not a monolithic agent. Rather, it is made up of many constituencies, including, in the United States, the legislative and executive branches, the Office of the Secretary of Defense, and the armed services and their various branches. As the deputy undersecretary of defense for acquisition and technology, James Finley oversees the Defense Department’s policies and procedures governing its procurement and acquisition process. ”The smallest team I have to deal with might be 40 people,” Finley said in an interview. And each constituency can exert varying degrees of influence on the acquisition process, as can the press, lobbying groups, and the public at large.
Within this highly political environment, the acquisition process that is used to procure major weapons systems is supposed to run apolitically. The actual process is anything but, and it is also exceedingly complex. What follows is a simplified, idealized version of the process.
The first step is to identify and assess top-level military needs or capabilities—for example, the ability to conduct space-based surveillance or perform long-range communications. The capabilities are based on guidance from the President and the Joint Chiefs of Staff. The White House periodically issues a National Security Strategy report, for instance, which describes the major security concerns for the United States and how the administration intends to deal with them. Each military service, or two or more services acting together, uses the report and other guidance to help define specific military systems that can support the government’s overall strategy. Once a new military capability has been identified, it means there is a ”gap” in existing capabilities. Now an acquisition program can formally begin.
As the program proceeds, it must pass a series of phases and milestones, where officials review its progress and decide whether it can or should proceed. Typically, a new program goes through a ”presystems” phase, during which the approaches and technologies that might be used to address the capability gap are identified. If a feasible solution is deemed to exist, a ”milestone A” decision is made that approves additional technology development. The presystems phase ends when a technology has been developed that can provide an incrementally useful and affordable military capability.
Once a program reaches a point where its managers feel that systems-level development can begin, the program undergoes a milestone B decision review. If senior DOD management agrees with the program management’s assessment, the program moves into its main design and development phase.
This next phase is guided by the program objectives for cost, schedule, and performance parameters over the program’s life. In addition to developing the system and demonstrating that it can function in its intended environment and meet its key performance parameters, program managers must also ensure that the industrial capabilities to produce the system are available. At this point, a milestone C decision is made to commit to initial production at a low rate. Full-scale production can begin only after yet another review.
Finally, the program enters an operations and support phase where the system is deployed and achieves full operational capability. All the logistics required to support the system are evaluated, as well as the operational readiness of the system once fielded. Continuous assessment and evaluation of the system is performed throughout its life cycle until the system is retired from service. Any weaknesses or deficiencies are identified, and flow back into the overall acquisition process to determine if or when they will be remedied.
Of course, this process is not as clean as it looks. ”There isn’t really an effective process for getting from the National Security Strategy to any specific acquisition,” says Robert C. Rubel, dean of naval warfare studies at the Naval War College, in Newport, R.I. ”There is an intellectual disconnect. The National Security Strategy looks 4 years ahead and deals with the problems of today. The acquisition process, however, looks out 10 to 15 years.”
In addition, according to the Government Accountability Office, programs routinely pass milestone B before the technology is sufficiently matured. Trying to develop a complex system based on immature technology almost guarantees cost over-runs and scheduling delays. The GAO also says that the DOD too often buys significant numbers of major and nonmajor systems while the programs are still in the initial production decision phase, before operational testing and evaluation of these systems has been completed. And in general, milestone decisions tend to not be used to take a critical look at the program’s technical feasibility or affordability. Instead, they act more as a mechanism to support the continuation of the program. Very few programs get terminated because of negative milestone decisions.
To Probe Further
For further detail on how the acquisition process works, read Introduction to Defense Acquisition Management , 7th ed., published by the Defense Acquisition University and available on line at http://www.dau.mil/pubs/gdbks/idam.asp. The description in this sidebar is largely drawn from that document.
For more articles and special features, go to What's Wrong with Weapons Acquisitions?