When Roper was in charge of the Strategic Capabilities Office he had the ability to move money between programs in a way that allowed him to solve his own problems, Barnes said. “We’re not talking about, ‘How do I move, you know, a billion dollars … five years from now?’” he said. “We’re talking about within year of execution, how can we move money within a portfolio to be able to take care of problems that were unforeseen and particularly you can do that from those programs that are performing extraordinarily well?”
In a perfect world, the Space Force would have as few budget line items as it could get away with, Barnes said. However, that is a discussion that has to be had with lawmakers as to what’s a reasonable number to be able to manage.
“Others might think that this is upending the way that Congress has typically done things,” he said. “That’s warranted, and it’s one that we very much appreciate and want to allay their concerns. We absolutely want to be very, very transparent with Congress, not just as to how … we build this process, but how we execute this process.”
There is no reason the Space Force can’t be as or even more transparent with Congress, he added. “The kinds of ways that we engage today with the Hill, or frankly, engage with [the office of the secretary of defense], it’s very much a sort of an industrial age process,” he said. “It’s, ‘Let’s build this report. Let’s take this report over to the Hill. Let’s give them a briefing,’” he said. “Whereas in today’s information environment, there’s no reason why we couldn’t give them … habitual, routine access to information.”
That was Shawn Barnes, the Air Force space adviser, in an Aerospace Nation series event, quoted in the article, “Give Space Force Funding Flexibility.” Listen to the whole conversation, Barnes was excellent.
The move towards financial reform has really been a tremendous step in the last year, and the Space Force has taken the lead. As Barnes pointed out, some organizations in the DoD already have what amounts to an organizational budget, rather than a program budget, allowing its leaders to move money to the highest value projects in an agile way. The Strategic Capabilities Office is one, but so is the Joint Artificial Intelligence Center, the Joint Improvised Threat Defeat Organization, and a few others.
My main concern with the Space Force plan, however, is that they want to consolidate budget line items into capability portfolios, such as Offensive/Defensive Space Control, Space Situational Awareness, Command & Control, Missile Warning, etc. These capabilities, however, are at cross purposes to the SMC 2.0 organization, where there is a PEO Development, PEO Production, PEO Enterprise, and PEO Space, in addition to a Space Rapid Capabilities Office. Potentially every single organization will participate in nearly every single capability area.
While the intention is to give Program Executive Officers and their Program Managers greater ability to treat their funds flexibly, they really won’t be able to be Portfolio Managers if each one of them shares a budget capability area. This many-to-many relationship between Organizations and Capability Areas is depicted in the figure below (put together myself using the FY21 budget):
Movements of funds within a capability budget area would ostensibly require adjudication at the higher levels. For example, if PEO Development wanted to move funds within Missile Warning, it might have to contend with other PEOs who also need the money. They might build a case that their own project is of higher priority within Missile Warning. Budget battles could then rage even hotter, though behind the closed doors of the Space Force.
My recommendation would be to consolidate budget line items by major organization, like the PEOs, and allow each one of their leaders to be true Portfolio Managers. Expected program activities should be identified and justified in the budget as Major Thrusts under the consolidated program elements. With the ability to move funds between programs, Space Force should then provide quarterly updates as to where the funds actually went to provide Congress with the kind of transparency Shawn Barnes was talking about. These projects could also be tagged by capability areas, providing different ways of showing how the Space Force is building programs within a unified architecture.
[Update: I’ll add this this isn’t my ultimate view of the Space Force budget/organization. I recognize that this simply moves the problem of administration from “organizations” being matrixed out to “programs” being matrixed out. Stay tuned for more, but I’ll briefly add the following:
(1) PEOs and PMs should be “dual hatted” and sit on boards, where they coordinate their activities more voluntarily and are simultaneously responsible for getting the work done (alongside a dedicated architect, but not dictated by him/her);
(2) I prefer some organizations work on platforms and be “cradle to the grave” while other organizations provide components/services like Launch, Ground, Enterprise Software;
(3) Program analysis is still important and should be happening all the time in planning future activities, but doesn’t need to be assembled under singular program elements in the budget two years ahead of time. Program analysis in data should move to after-the-fact analysis by assembling pieces of budget, contract, and technical information and putting them into coherent wholes, something that isn’t done well today. In fact, the current Space Force budget already has GPS broken down into GPS III, GPS OCX, GPS MGUE, GPS III Follow on, and then classified GPS efforts.]
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