NDIA PERSPECTIVE DEFENSE DEPARTMENT
It’s Time for a Fresh Look at Resourcing Defense
“What are DoD’s priorities?”
This is a question all National Defense Industrial Association members ask, and one that every eight weeks Rachel McCaffrey, NDIA’s vice president for membership and chapters, and Jon Etherton, NDIA’s senior fellow emeritus for acquisition policy, try to address during an NDIA members-only webinar.
McCaffrey and Etherton hold this bimonthly forum to offer our members an overview of the Defense Department’s planning, programming, budgeting and execution processes, also known as PPBE. The goal is to help them understand how these four processes drive capability development and sustainment and how resourcing, by default, defines DoD’s priorities.
That said, the issue remains: Decoding the department’s strategic priorities from its resourcing decisions is a challenge in the best of times.
That is why, in line with NDIA’s objective to educate and promote budget stability, McCaffrey, Etherton and members of the Strategy and Policy team have begun work on a report to describe these resourcing processes as they stand today, with an eye for identifying stakeholders as well as the incentives and disincentives that drive resourcing decisions.
NDIA’s support of budget stability rests on our belief that Defense Department planners, programmers and comptrollers can most effectively manage resourcing limitations if they have accurate knowledge about funding levels, specifically in the near term and more generally in the mid- and long-term. We continue to believe budget stability is critical to ensuring our warfighters have the capabilities, training and support to enjoy decisive advantages across the spectrum of conflict.
However, as the United States pursues transformative technologies to maintain competitive advantage, we recognize resourcing processes will significantly impact our success at delivering these capabilities quickly and efficiently.
Congress and the department have, over time, implemented several resourcing programs designed to rapidly identify promising technologies to solve emerging defense challenges. The Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs and other transaction authority agreements (OTAs) offer pathways for innovation to gain visibility and acceptance.
However, we continue to hear stories from across industry sectors about the difficulty of scaling these promising technologies across the force.
Much discussion focuses on the “Valley of Death,” the timeframe between recognition of a promising technology through SBIR, STTR, OTAs, or other developmental resourcing processes and creation of a program of record with a secure funding stream to address personnel and sustainment costs as well as development and procurement. Many stakeholders recommend a “bridge fund” to help smaller companies without significant capital backing to cross that valley. But a key part of any bridge is to have an end point, and in the case of Pentagon resourcing, the end point is insertion into a service program objective memorandum, or POM, for congressional consideration as part of the president’s budget request.
Insertion into the POM, too, can be very challenging, especially if an emerging program requires significant resources, because adding something to a service program objective memorandum requires removing something from the POM to create space. Because services program over a five-year period, new capabilities obtain resources by trading existing capabilities. This leads to trade decisions that can create conflict between government organizations, companies and congressional delegations: trades can eliminate funding and personnel for some capabilities and missions in order to resource new capabilities and missions.
These are difficult discussions and decisions because they involve current and future capability and capacity, and different stakeholders have missions and requirements that define their priorities in ways that may compete with other stakeholder requirements. Combatant commanders, for instance, have a significant interest in conducting current operations, deterring potential adversaries and having access to forces to execute operations plans during contingencies. As such, they tend to prioritize existing programs. On the other hand, the service chiefs, who share interest in current capabilities and capacity, have competing priorities to ensure future forces can execute the missions outlined in our National Security Strategy and National Defense Strategy. Thus, the services will sometimes be more willing to consider trades of existing capabilities and capacity to resource future technologies.
We need to take a fresh look at PPBE as it exists today, by describing the resourcing processes, identifying stakeholders, and defining incentives and disincentives in the system. NDIA hopes its forthcoming report, tentatively titled “Stepping Back from Acquisition Reform: How Our Resourcing Processes Drive Defense Outcomes,” will help all individuals and groups interested in national security understand current friction points, which can potentially lead to new ideas that more effectively resource innovation. The report builds upon the research and analysis in our 2014 report, “Pathway to Transformation: NDIA Acquisition Reform Recommendations.”
Acquisition reform depends on effective resourcing processes, policies and decisions — decisions that ultimately define defense priorities. We believe understanding these processes is a key first step in shaping decisions to prioritize the right capabilities for America’s national security.
I invite all to read a description of our new project. We look forward to engaging our members on this important topic as we describe current resourcing processes to help ensure our defense industrial base continues to deliver capabilities to provide cutting edge advantages to our warfighters.
Retired Gen. Hawk Carlisle is president and CEO of the National Defense Industrial Association.
Topics: Defense Department, Defense Contracting