Ellen Chang: [00:00:36] Welcome everybody to our panel today. My name is Ellen Chang I’m one of the co-founders of an organization called Wharton aerospace that is really comprised of an industry group traditionals. And. Non-traditionals. Background is Naval Intel finance and innovation right now. But I’m so proud to be able to introduce our three panelists here who are going to unpack some of the conversations we just had at the previous panel, which was looking at new ways of.
Budget agility as well as conversations or coordination between the Pentagon and Congress. So we have with us, Jamie Morin, who is an economist by background and is currently at the aerospace corporation center of space policy being a space person, myself, very interested and honored to meet you.
For this purpose though, his background that’s really relevant here is his time leading the Cape At the Pentagon. And then we have John Young, who’s an engineer by background worked at a national lab and also in industry, and then really is known for his time with appropriations.
And then we have who is definitely has a storied career as a writer educator at the national war college in Columbia, a politician and even Most importantly, here for this purpose, a DOD controller, which, when we were preparing for this panel, he talked about not providing $2 billion to one of the admirals who asked him for money, which I thought was great.
So with that, I’m just going to turn it over to you, Jerry.
Jerry McGinn: [00:01:58] Great. Great. Yeah. Thanks Ellen. And Ellen is going to be here with us as well and help us do the wrap up towards the end, but it’s great to have you on, I’m real excited to partner with Wharton aerospace on this event, and we’re going to have actually more events coming up.
So stay tuned to this channel for future events and between the center and wharton aerospace. Yeah, no, we’ve got a. The whole idea of this panel was to take some of the incredible topics and issue that were presented in the previous panel of, the reports for the AI commission the Hudson report as well as the MITRE five by five report and say, and go to the, go to these real experts, these real grizzled veterans and of the of the Hill of the appropriations world of the green shade man.
Dr. Mr. Zakheim. As well as the budget to the program himself Mr. Morin. So you all have that kind of expertise and to help us think through, okay. What’s realistic going forward. So I’m really pleased that you all could join us. I want to talk about Jim making the first question to you as the former director of Cape, and now a big role at aerospace corporation.
Can you see how a Cape adapting our accepting kind of a portfolio or organizational budgetary approach. And how would that look like? What you know with, within the organization. So over to you
Jamie Morin: [00:03:16] and Jerry, it’s a terrific question. And. I thought our discussion earlier today really opened a lot of doors of new ways of conceptualizing how the department’s resources are programmed, allocated by Congress, executed.
They’re really complex issues in here. And you’re going to hear that I’m sure from John and dove as well as they think across the the life cycle. I’ve been a pretty aggressive advocate for defense portfolio management. That’s something, both Christine Fox and I worked pretty hard from a CAPE perspective.
Before I went to Cape, I spent. Five years with the air force as the comptroller and as the acting under secretary there. And so saw the execution side very much as well. And, it’s, it is absolutely reality that if you ain’t funded, you ain’t. So we shouldn’t lose sight of that.
I think as we look at these proposals, what you’ve got to think through is what use case you’re optimizing for, right? The notion that will adapt William Shakespeare and just first kill all the analysts is not the right answer. The right answer is not to run a $700 billion a year enterprise by a uncoordinated action at the lowest possible responsible level. That’s not going to build a effective joint force. Just as analysis paralysis will also not do that. I think we want to be thinking about this in terms of departmental governance, the secretary of defense and the chairman of the joint chiefs as the secretary’s lead military advisor and the president’s lead military advisor have specific use cases for information.
To provide direction to the department. And we are entering into an era where we need agility at the lowest possible level, and we need strategic alignment and direction from the highest levels we’ve got to be able to do both. And so how do you address your most important decision support use cases?
Without giving up the execution, agility. I think personally those most important use cases are surrounding hard strategy choices. The ones that really say a is a winner and B as a loser, cause we’re making a choice. And in an institutional, the department of defense, those kinds of choices will slip away.
If the secretary and the senior most. Civilian leadership, the department don’t have the analytic lens, the data lens in order to see that you’re actually making progress on. I would also argue there’s some one way doors out there to borrow a Jeff Bezos’ as formulation on corporate strategy. Right?
There’s things that once you do them, you can’t undo. Two of my favorite fictional weapons, the the death star and the orbital mind control laser, right? If you’re going to field either of those weapons systems, that is not a program manager level decision, even if the technology was there.
And obviously in this unclassified environment, I can’t tell you if it is, just kidding. those are strategic level choices that would, you’d want to rise to the, certainly the secretary, probably the president. But as we think through portfolio management, as we think through how Cape in particular can use portfolio management to support sector of decision-making.
I think you’re really interesting and tough questions. Some of which were hinted at, in the earlier presentations get to how can you use them to drive down to execution if you will, across the fund’s life cycle and how can you use them to drive down to actual program management and choices and operational choices.
So across the operational life cycle the capability life cycle. And we don’t do those well in the department of defense at all. In a pure portfolio management environment. I would want a decision-maker for long range strike capabilities to be able to trade with how they deploy the B2 wing at Whiteman air force base.
Because you might want to forward deploy that unit in order to change your force structure needs or your weapons needs. We don’t do that very well at all. And so if we’re going to embrace these kinds of radical restructures of the budget, we want to think through, does that need to change also?
How we organize the force as a whole, so that we’re pulling on the right levers, that this takes me to my final point, which is we cannot lose sight of the fact that the department of defense will never have a single financial bottom line, like a for-profit enterprise, our value model. How we, yes, the I’ll go back to economic strain.
How do we assess the “utils” that the taxpayer and the president get out of the force? Is a non-trivial thing to measure. It will always be contested. It will always be contingent. So the debates have to be able to be addressed in the absence of that single agreed bottom line of profit and loss, that you can’t get away from that problem.
Jerry McGinn: [00:08:20] Great remarks. Jamie, to quick follow up for you? Yeah. What is your sense of the, the where CAPE is in terms of would CAPE be open to this kind of the personnel, the folks that work for you back then, and would they be open to exploring this in different areas?
Jamie Morin: [00:08:33] Oh, I think absolutely. There’s been an ongoing debate in Cape, on FYDP reform. There was a discussion earlier the major force programs, not well aligned with the current way we think about the department strategically, right? Strategic forces and general purpose forces is no longer a super useful division point.
And also by the way, we’re in a world where database technology doesn’t require that you have a mutually exclusive and collectively exhaustive hierarchy that is completely defined and is all just levels of indenture. We can do much more tagging, but I’m sure John is going to talk about the congressional all equities.
If the Congress often is longer tenured than the leadership in the department of defense. And particularly the professional staff members over there who often have decades of experience on these issues, they appreciate the value of constant of discrete trackable entities that they can follow over time because they know sometimes the department is interested in conveying success and can rearrange the measurement in order to, display that.
And so they want. Verifiability and accountability, and that’s not unreasonable in our constitutional system. So we have to be able to present data in multiple ways while not turning it into, the the Suzanne of bloom beautiful vision of the multifaceted cube of FYDP right across. Major forest program, service life cycle of appropriation.
And that gets you into these tiny little blocks that give us insufficient agility. So those are all the problems we’ve got to work through the fundamental coin for all of it. That was trust. Yeah, and that’d be built over time through behavior.
Jerry McGinn: [00:10:17] Great. That’s tremendous. Yeah. I think it’s a perfect segue to John.
And I’m looking at the desk star over Jamie’s shoulder. Some people have, a view of the appropriators that, it, I think everyone has their. Your perspective? depends on where you sit, right? And but the appropriators perspective is often not, it’s definitely not understood.
And by those of us in more kind of acquisition policy perspective so we’d love to get your perspective on as Jamie outlined there’s definitely a strong, legitimate need for oversight. And even as we adapt things, hat, but how do we do that in a way to both meet the needs of the threats facing us today?
And maintained and the Congress has need to be able to do proper oversight. So I’d love to get your thoughts after a decade of appropriators, plus your time
John Young: [00:10:59] into building, sir.
I I had a wonderful experience as an appropriator, and I think there’s been a lot of talk in the first panel about portfolios, to be honest with you.
Some of the first level of portfolio management happens on the Hill. Now the building doesn’t love it because the building doesn’t like the dimensions of the Hill overseeing their work. But I had accounts across the services and frequently I had a great opportunity to see the army or the Navy or the air force doing the same thing.
And try to force jointness wherever I could from a Hill. So you know, the appropriation staff is small it’s seven, eight people. And as Jamie said, when I was there, they had a deep and long tenure. Some of that tenure has come down, but still generally. They have a visibility across the budget and experience and with the four year or less rotation of PEOs and PMs based sometimes have more continuity than the department does on the program.
So I think that the Hill, at least in that particular respect or reviewing the programs has the potential to add some value. We all have to be careful about earmarking. I, when I started earmarking was a relatively small process with a few, a couple of hundred requests. By the time I left and went to the Pentagon, it was in an access database with 5,000 requests.
And that pressure on the staff had become far greater to find things, to cut, to pay for the member ads. And so I hope earmarking will not go back to that. But the process where the appropriators and the authorizers add value by looking across the portfolio and trying to force, jointness and try to moderate duplication or eliminate, it was more valuable than people realize.
I, I’d add one thing from the first panel. I was thinking about, as they were talking, Congress is a retail operation. It’s about constituents and districts and States. I see the, I see some merits. The portfolio discussion has been around since I was in the Pentagon. I see some slight utility to it.
But I’m not sure. I think it’s the be all to end all. That guy, I made some money, opening remarks. One thing I think we should make progress with is reprogramming thresholds. They haven’t moved with inflation. They haven’t moved in any way that are meaningful. And you started with the Eric Schmidt comment.
I tell people this frequently. It’s you know, when you have an idea it’s 21, 24 months from idea to, to appropriate funds. That’s not going to work with the movement of technology we have today. And with peer adversaries who don’t live under those kinds of constraints, we need to move the reprogramming thresholds so that money can move within the portfolio or between programs, whichever way you want to say it.
To fix problems that emerge over the course of this 20 month cycle of change, getting a new budget and building a new budget and getting a new budget. And we need to see if we can get some ground with a Congress on new start. I had a small piece of money as DDR and E. That was really un-designated with a guy named Ben Raleigh, who was extremely good manager, and we could go do some new things because technology’s emerged or needs emerged, or the chance to marry a technology with a need emerged and that was precious money. It had constant Hill pressure push Hill hates to provide money. That’s not designated and going to a retail district location. I think it’s worth some effort in the budget process to try to regain. Elements of what people want to talk about in different, in, in ways that are palatable by the hill, either through higher reprogramming levels, some ground on new start reprogramming in the R and D space.
And then the ability to use that money. When a program has a big acquisition program, that’s gonna ha endure, a couple of months schedule slip, which can easily be a couple of hundred million dollars. If they could just get $50 million in a timely manner, they could avoid that slip. Nobody on the Hill well appreciates that. And that’s a fixed, it needs to be made. And then the other fix, that’s probably obvious to all of us. The Hill if at all possible, I think that the Pentagon needs to educate the Hill better on the impact of continuing resolutions. They are just devastating the acquisition programs and many RDT, any programs.
And I think the Pentagon and make a nice with the Hill. Let’s this get swept under the rug, but the truth is. We waste a massive amount of taxpayer money because of this continuing resolution process that really needs to go away.
Yeah.
Jerry McGinn: [00:15:51] That is a Hardy perennial unfortunately Dov, I’d love to turn to you and get your perspective on speaking of reprogramming and the that, the control perspective on how some of the ideas we heard in the previous panel, what are ways that we can start moving that and building frankly, and building relationships with the Hill, because it’s not going to be done as less we get it on
Dov Zakheim: [00:16:11] both sides. There.
I’m really glad that John brought that up and you just have as well. I noticed that in one of the articles that said P D E began in 2001. Guess who added the E, but I didn’t just want to add execution. We have, let me back up.
We have one execution review a year mid-year review. And at that point, you look at the burn rates. Who’s spending more, who’s spending less than you move money around. That’s not how a business works. A business moves money around all the time. And what I wanted to do correct me if I’m wrong, Alan.
And what I wanted to do was have at least two additional execution reviews and actually a quarterly execution review. And I believe that’s exceedingly important today because of the nature of X, if we want to experimentation. And we want to bring in all kinds of new technologies, whether it’s AI related and quantum computing related hypersonics, whatever it is.
You want to be able to move money into those programs quickly and move money out of programs that aren’t doing very well or do what John just said, move money into a program that if it got a timely boost would not lose your money later on because you’re wasting it because of schedule and program delays.
Now that has not happened. And I would argue very strongly that if the department is really serious about getting past with Kath Hicks, the deputy’s called the Valley of death. The time it takes between the time you actually come up with some idea and actually feel it, you’ve got to be able to move money around quickly.
It’s as simple as that’s number one, number two, and John mentioned this as well. The thresholds. It’s nuts that you have to go back to Congress to at least to four committees and say, mother may have guy, if I want to spend more than $10 million on R and D any kind of R and D spending. Let’s be honest, $10 million when I was controller and that’s getting on for 20 years ago was not even, it didn’t even qualify as a rounding error.
And just to give you a sense of what I’m talking about. Ellen mentioned that $2 billion story. Let me tell you the actual story. I was just coming in as comptroller. And when you come in as a new guy, relatively senior guy all the admirals and generals come in and they want to have what they call a courtesy call so that you’ll remember them and like them and maybe give them some money.
So this Admiral shows up two minutes late. And I looked at him with a mean looking face, cause he didn’t know me from Adam. And I said, that just cost you $2 billion. You were 2 minutes late. That’s a billion, a minute guy almost died. But the fact is that $2 billion is a rounding error. Nowadays we’re talking about a $700 billion budget.
How in God’s name? Can we talk about that sum of money and at the same time say if you want to actually get something new, going. You better go to four committees of the Hill before you can spend $11 million. That is madness. And that’s an appropriations thing, by the way, the appropriators are the ones that deal with this.
And it, you’re talking about portfolio management, which by the way, I’m old enough to remember when it was called mission budgeting. It’s the same thing. Again, how do you manage your portfolio unless you have the ability to move monies around. Remember the comptroller is a budget exercise.
What’s far more important in the world of business is the other title that the comptroller has chief financial officer who was always more senior to the comptroller. Why? Because the chief financial officer is managing the dollars, not the dollars you’re asking from the Hill, but the dollars you’re getting from the Hill.
That management is absolutely critical. And let me, I’ve got lots more to talk about. I don’t want to take up everybody’s time, but let me just finish with one other story in November of 2001. So this is what six weeks after nine 11. And we’re already going into Afghanistan. Ron Sega, who was then the head of DDR and E the defense research and engineering shop comes to me and says, I’ve got a weapon that can blow these terrorists out of their caves.
It’s called a hyperbaric weapon. I said, so what’s the problem. He says nobody’s ever wanted to fund it. I said, how much do you need? You said, I don’t know, less than 50 million. And when can you get it out there? He says, you get me the 50 million or whatever it was. I’ll have it out in the field by March.
Okay. This is November. I had, everybody’s got a Bishop’s fund, which is a whole other thing everybody’s got a 10% will withhold at every level, which is money that gets sloshed around. And that’s a whole problem in and of itself. But I wasn’t the Bishop. I was the Cardinal, young used to kiss my ring and.
See, he admits it. And so did members of Congress, by the way, when they wanted the money. So I said to him, I’ve got the money. You get the money. Four months later, that weapon was blowing terrorists out of caves. My point is that is what flexibility is all about. And it shouldn’t be managed through Bishop’s funds.
It should be baked into the system and I’ll stop there.
Jerry McGinn: [00:21:14] Okay. I wonder if we could push you and John A. Little bit on this point is in that this need for flexibility. A lot of this comes down to the issue of the Jamie rates trust. Okay. And how do we get there from from here, so to speak in the kind of relationships between principally the building and the Hill on some of these appropriations issues?
John Young: [00:21:35] I’ll take a shot at it and I’m going to be probably a. I’ll give my colleagues, particularly Jamie a chance to counter my view. I actually think it’s not a bad thing for acquisition programs to build a budget and try to work to that budget. And so I, this portfolio here’s going to be my starting point.
Let me start where dove started. To try to answer your question, Jerry. And that is, I’ve tried to figure out what made acquisition work better in the past, because I think people think it, it worked better somewhat. I’m not sure that’s perfectly true. Cause there was Packard commission and it seems we’ve forever been studying how to reform acquisition.
But one thing that was different, if you go back to Johnny Foster and people, he had that Bishop’s fund, he had an em account. And Johnny used them account to help create the space based infrared system and a couple other things, couple of big ideas that became successful, but because the Pentagon can’t stop itself abuses of the AMA count, took them account way.
And that’s why I talked about that DDR ne thing, these efforts to have those that have Bishop’s account or flexible money have constantly been eroded because the Congress doesn’t want to give you that. And then when the dependent on is had it, they’ve managed to create a trust issue. And so I think you’ve put your finger on a real problem from the trust issue, point of view, but from a budget point of view.
And so when we build a budget now, And this was a frustration for me. And I’ve said this repeatedly, I’m gonna get a chance to say it again today. We build a one-year budget with four spreadsheets and a bunch of part money. I think the Pentagon squanders, an enormous opportunity to build a credible five-year budget.
And so I’m going to go out on a limb and say, until you can build a better five-year budget or even a two year budget, this portfolio discussions bogus. It’s just going to be another internal churn process. That’s what we actually need to get away from is having to have a fairly stable budget that we could live with for a few years.
And I think that’s why. Because the Pentagon turns the budget so much. The Congress is not overly receptive. They won’t be receptive anyway, but they’re not overly receptive to two year budgeting because we can’t hardly build a one year your budget. That works well, but we should build a, if you could build program lanes for major programs and then have some reasonable reprogramming authorities, you’d be able to fix things and treat it somewhat like a portfolio.
And then there may be other places where you need a portfolio where there’s like truly cross cutting technology. But many of the platforms demand a discipline program and a budget to go forward from that. And then the way to, I think to rebuild that trust with the department is keep trying hard to build those credible budgets and execute to those budgets and convince the Congress that we can do this.
And we have done such a poor job on that front, that getting the kind of flexibilities that we’re all talking about here are going to be a bit challenging with the Congress,
Dov Zakheim: [00:24:34] It is a matter of trust. And when I was comptroller, I went out of my way, gentlemen, remember this to be open with the appropriation staff first, I just didn’t want to blindside them once you blindside somebody, forget it.
And as John said, these folks stick around a long time and they just don’t forget. Now we have an opportunity right now to test John’s thesis about trust. And managing the equivalent of an M account a fund. The defense innovative unit DIU is probably the key organization that reaches out to the commercial sector in order to see what’s out there and bring it into the system and get it fielded quickly.
Now, not everything they bet on is going to work. What I’ve been talking to them about for some time is. And they seem to be doing it is look for a fund. See if Congress, the appropriate is we’ll agree. This isn’t going to be big bucks cause they don’t spend big bucks, but it’s a way of building up trust.
If the appropriators seen that you’re using the money responsibly, that you’re putting it into programs that might work and make a huge difference. Vis-a-vis say China some, and you take it out of those that look like they’re not working and putting them into other ones. And you have that flexibility.
So you don’t have to keep going back and saying, mother, may I, and you don’t even need the comptroller to do that for you. Then you begin to build up trust and trust goes a huge way. I remember I had a deal. I was asked by Rumsfeld to find money for what became a UN long-standing program of assistance to Pakistan.
And he wanted me to find it inside of a week. Now try getting something out of Congress inside of a week. It turned out that the chief clerk of the house appropriations committee, Jim Dyer was somebody who trusted me. We’re still friends. And I went to Jim and I told him what I needed. And we put together a package.
It was already in conference. He figured out how to keep that request in scope, which means that they could deal with it. And we got the money. You can’t do that if people don’t trust you, it’s just as simple as that. So rule number one for the Pentagon is don’t try to bluff your way past Congress. Hey, they’re going to catch you and B they’re going to really beat you up, not just this year, but future years, which is my last point about the five-year plan.
We have models for that. We have multi-year programming. John did that when he was in charge, we need to expand that. And we need not to play around with it. Yeah.
John Young: [00:27:06] Just one quick on doves thing, every acquisition program, I could lock up in a multi-year I locked up because two things, one, it locked it up from dove from the Congress, from everybody a and B industry wanted that.
I got a remarkable deal. I said, I got a far better deal than I would have otherwise on Virginia class submarines because I went and got them a multi-year where we delivered the first submarine, which gets to Dove’s point. The only reason I could do that is Jerry Lewis and John Murtha and obviously Senator Stevens and Sarah noway, who I worked for.
They trusted me enough to believe that I could sign that multi here and not have it come back and haunt us.
Dov Zakheim: [00:27:52] And the other thing that’s critical in that. And you mentioned Dan, in a way, you’ve got to understand that you’re not always going to get it a hundred percent your way in a way, told me when I went for my courtesy call, when I was coming up for comptroller, you got to give a little to get a little, that is something that’s become very hard in much of the Congress, but not actually in the armed services and the French appropriation subcommittee.
It’s doable if the Pentagon is willing to do it, and that’s a whole other matter, I’ll stop there.
Jerry McGinn: [00:28:22] Okay. Jaime, I’m sorry. We’ll get you in there.
Jamie Morin: [00:28:24] Yeah, it was quite all right. The, I think if you think across the points that both Dov and John had been making and get back to the reports, we’ve heard about the conversation surrounding reprogramming transfer authorities and thresholds and the conversation about.
Program elements structure are really two different sides of the same coin because you don’t need your transfer authorities and your reprogramming process. If you have flexibility within unappropriated program element the basis for constructing those program elements is not written in the constitution and it’s not a matter of immutable, natural law.
It’s a choice. One of the things that you’ve seen with the stand up of the U S space force is a effort to reconceptualize how they structure their appropriations requests around their programs and doing, if we think about this kind of analytically, right? You can have program elements that focus on Specific pieces of hardware, and those might be very attractive to a member of Congress who cares, which districts something is manufactured in.
You can have program elements that are focused around a point in the life cycle. We do that for our research and development, right? We’ve got separate program elements for different levels of maturity. We, you can have program elements that are focused on who’s responsible for a system who owns it.
We have service breakdowns embedded in the program elements obviously. All of those things are actually choices. And the degree to which we agglomerate things are choices, different stakeholders are going to have different views on this in a modern data management environment. We can actually have a bit of a mosaic where we have slightly different approaches in different areas, but you can’t have crazy quilt.
We should think carefully about, given the nature of different operational challenges, given the nature of different programmatic challenges, what’s the right approach. Is it a system that’s going to take a long time to develop no matter what, in which case you probably want more flexibility across research and development and procurement.
Is it a system that is going to be fielded with an agile development model? In which case you need more flexibility across the operations and maintenance type activity and development, and maybe there’s really no such thing as procurement ever, is it commercially dominated? In which case, or is it potentially commercially dominated, but you’re not sure yet.
And so you need flexibility to go either with a development and procurement approach or a buy as a service approach. How can you think about those problems upfront structure them and, to borrow Clayton Christianson’s old notion of the innovator’s dilemma. There is value for these sort of special purpose organizations that look radically different than anybody else in the department and are going to be managed that way.
The SCOs, the DIUs, the space, RCOs the Jakes and that’s okay. That’s okay. We can tolerate that and we can give those organizations different models with the right trust and with the right understanding up to the governance level of the department. As to how those organizations are generating value for the nation, how are they generating real security?
Not just feathering a nest or taking care of one specific claimant, but actually making the American people more secure, actually getting us better, combat more combat capability out of each taxpayer dollar.
John Young: [00:32:00] I’d like to add on Jamie’s comment just briefly. I would go where he wasn’t beyond as someone that ran the MRAP task force.
I ran a biometrics task force. There is a lot of merit to some task force models inside the Pentagon that both have a job to do it with urgency. And then presumably go away. Sometimes I don’t just, I agree with RCOs and STOs and things like that. But on the other hand, some of those become part of the system too.
And I, the department should not lose sight of the opportunities. And the benefits gained by having a task force structures that come and go and do a job.
Dov Zakheim: [00:32:39] Yeah. In business, the task forces are called tiger teams and the whole purpose of a tiger team is to go in and fix something and get out.
You don’t have a tiger team that lasts years and years. We have those in the Pentagon and what you therefore get is a never-ending bureaucracy. That’s no good. The other thing that we need to do, and this goes to personnel, we need to be sure that our senior managers really know the technology. You can get a job in the Pentagon.
You’ve just gotten your master’s in physics or whatever, or an engineering or computer science and never take another course again. Yeah. Ever adopter has to take. Courses to remain qualified. The military has professional military education, but our civilians don’t. And as a result, we wind up going to contractors to interface with other contractors.
That’s essentially creating middlemen and all the middleman really does is cost your money. You need them because you can’t do it yourself. Yeah. So one of the dirty little secrets about our acquisition system and about many of our problems and I don’t call them challenges, their problems in the Pentagon is HR management.
How do we manage our personnel?
Yeah.
Jamie Morin: [00:33:58] I need to point out just for a moment of dove accountability here. The air force and NASA are the founders of the tiger team concept.
Dov Zakheim: [00:34:06] That’s fine. That’s fine. And he picked up on it.
Jamie Morin: [00:34:09] I’m in the department of dove accountability and have been for awhile. It says one of my special projects.
Jerry McGinn: [00:34:15] I, we’ve got a question from Mr. David Schiff who apropos to doves appoint and John as well. I Tiger teams, the task force is gonna offer short term value, but who retains. The lessons and best practices when they succeed or fail. And so that leads me to something. I was going to ask Jamie and back, cause I was actually going to ask you about the space force is a space for us, a way for us to pilot some of these kinds of, these kind of new approaches, to build a P like I started to build a PE differently.
Should we use that? And that way you’ve got enough of a critical mass of something that, that we can not repeat the same lessons all over again, over.
Jamie Morin: [00:34:46] That is absolutely their intent is an issue. I’ve had a few chances to talk with general Jay Raymond about, and, DT Thompson and John Thompson, some of the key leaders in the space force and the air force space community right now, they’re absolutely grappling with that and looking for it, the they were tasked by the Congress or the department of air force was tasked by the Congress.
Now that. With producing a alternate acquisition system for space. And there’s been some back and forth over some of those ideas and a draft report that was sent over to the Congress, but it was never formally cleared by the by the white house in the previous administration. It’s an ongoing dialogue and it does take us back to this trust question.
, but they absolutely see the standup of this new service as a unique and time limited opportunity to reconceptualize a whole bunch of these things to, to, fundamentally have different focus items different structures, different management approaches. They’re very much committed to light and lean approach something certainly dove would resonate with. I think the biggest challenge they face is that there’s a lot of processes in the Pentagon that services have to plug into without themselves defining. And so figuring out how my former colleagues at Cape dubs, former colleagues in comptroller, John’s former colleagues in the acquisition and research and engineering enterprise and the interface with this very small service.
Probably a 10th of the size of the Marine Corps. How can they interface with this very small service without crushing it on the demand for data and flip that on its head? How can the secretary of defense and the deputy secretary and the chairman and vice chairman of joint chiefs, how can they have the confidence in the service?
And the military department of the air force is leadership of these issues so that they can give them the running room. I personally think the heart of all of this and the thing I think that the space force leadership is going to get after is data visibility and shared insight. Modern corporate management is not a multiple gate many multiple gate decision-making process, but it’s also not a set somebody loose and have them report back a year later.
There’s a lot of financial visibility up the chain and you better believe higher levels in both the financial function and the operational functions are looking at delivered results. So how can we do that? Light footprint way, and by the way, that might even extend to the Congress, right?
Rather than getting quarterly execution reports out of this new service, would the Congress agree to read access? To much more real-time system. Would the service be willing to give that physical that could open huge doors to new ways of running things that are much more agile? Carrie,
John Young: [00:37:38] this was on my talking points and I’d like, as the panels are trying to figure out the fundamental problems here, Think about one of the fundamental problems being disenfranchised, people that want to see something different. Cause they don’t like what we have. Let me explain why. By that every company in business by and large, these days builds a budget and most of them have a capital budget and they do it by project.
So I, and the Pentagon’s not anomalous here in having a budgeting process, but what we are anomalous about here is the control issues here. The services control the budget process from like January to July and not only the services, but the service chiefs. I was blessed to get to work with Gordon because Gordon England supported his assistant secretaries.
And so Gordon sorta said, unless the acquisition programs are right by John’s point of view, he wasn’t going to accept the budget. And that led CNO, Vern Clark to bring me in. And I’m not, unprecedented, but bring me into his final budget meetings and agree because Gordon was supporting me and Gordon and he together really wanted to see the acquisition programs to be right.
But in general, the service chiefs and the resource sponsors, they control that piece of the process. And we got a ton of disenfranchised acquisition people and base commanders. And for that matter, combatant commanders, Who don’t feel like they know what’s going on in the budget process. And then the budgets built with a bunch of holes in it and gaps and games and given to OSD late August, September.
So then to try to find their way through and deal with the secretary’s priorities and the combatant commanders issues. In today’s information age, we could have a transparent Brock budget process and I’m in, I’d be happy to have the CAIG and the Cape and the comptroller involved in building the budget because I expect my PEOs and broker managers to be good enough to defend their program.
I expect on the other hand, the Cape and the comptroller to not necessarily be monkeying around in programs that they don’t necessarily know how to run. That’d be a longer discussion, but a more transparent budget process. For everybody participate in. And so program managers had a say in what they were handed and they thought they could execute it.
Would be better. And likewise, I think you can share more information than they do with the Hill. That gets back to the discussion Dov. And I were having about trust. This hiding things is going to be a wall that the Hill and the Pentagon can never bridge until we decide to be a little more open about execution.
And there’s really no reason not to. And frankly, a lot of times it ends up biting us in the press, but. Better visibility inside the building on building the budget for everybody would be an improvement and immense eminently possible in today’s information age.
Dov Zakheim: [00:40:30] Let me jump in on something Jamie said I agree that the space force and I worked on a study with CNA on it needs to be the source of an experiment.
And the question then is how do you then deal with on the one hand, what you might learn from the experiment and on the other hand with the Pentagon as a whole. So for instance, you could have much more rapid execution visibility. John just mentioned at a lower level, but suppose you have major trade-offs space versus I don’t know, an aircraft carrier.
That’s where. A more regularized execution level at the OSD level becomes exceedingly important. And that also, I think, talks to the question that you were asked about the tiger teams and how do you take what they came up with and regularize it in some way. What happens in industry? You basically have lessons learned.
Now the difference is that an industry you really learn lessons. In the Pentagon, as often as not, you forget them. That is a huge problem. And it’s ironic because you’ve got peop the civilians sticking around for a very long time. But nevertheless, I can think of concrete cases where there was a lessons learned study.
There were a whole bunch of lessons and they weren’t applied next time. Something similar came round. Yeah, that has to stop. Yeah.
Jerry McGinn: [00:41:56] That’s a very good point. And it points to there been one effort to stand up a what’s called a acquisition innovation and research center at a university. And it’s getting growing now.
And the whole part of the whole mission of that was to help, to keep track of these kinds of all these various efforts. So we can build your knowledge. Before we were at a time we’re getting closer. I wanted to ask you all the the reports that were in the previous session, number of them recommended.
Pilot efforts or, and, or a commission to look at budget reform, wanting to get your perspectives on that. Should we just learn? Should we focus on a pilot effort? Or should we do a big commission? And and what do you think is going to be most productive to help reach the goals that we’re talking about? Building the trust and transparency over? So start with,
let me start with Jamie.
Jamie Morin: [00:42:40] So we first need to recognize, as I think the report authors have, we’ve got quite a few pilot activities underway right now. So the department needs to put some significant focus into executing under those. I should note, by the way, pilot programs should be allowed to fail.
Cause you’re piloting to learn. And so you may, if I’ll just pick examples at random here, right? If Jake blows up, because that, wasn’t a good way of thinking about resourcing for AI, that’s probably not a good thing. But it’s not the end of the world for the department as a whole.
And there might be lessons learned if SCO failed. That would be an opportunity to learn lessons. If DIU had a major debacle, that would be an opportunity to fail. So we shouldn’t try to force all of these pilot programs to succeed, but key ones that are out there where the Congress is providing some flexibility, some trust to the department the the R and D budget activity eight.
Work for software. For example, the department needs to focus on figuring out how to adapt rest of department to allow those things to succeed. And not put obstacles in the way of it. I think for additional pilot type activities, I would look at the space force as a potential participant. And again, seek to use the sort of tabula rasa, a blank slate of a new service to have the the least dependency.
It’s much harder to change big moving processes than it is to. Design new processes for new organizations. And I would also I would look at multiple models here. So you’re, the speakers this morning talked about mission portfolios. They talked about organizational portfolios.
They talked about operational challenge portfolios. I think you could frankly try in different areas. All of those models. It’s not a question of, again, restructuring the entire future year’s defense plan into one big bang transformation for the department. It’s about working through some different ways that could work, letting talented leaders build trust with the Congress and with the secretary and having this plug into a department level governance process, right?
We are not going to be in an environment of rapid increase in resources. We’re out of money, gentlemen and ladies it’s time to think. And so let’s make those choices, but the leadership, the secretary of defense is going to need Rutter authority to turn the department in the direction it needs to go.
And that demands governance that’s focused on the department’s highest priorities and takes risk squeezes finds efficiency in the other areas to get after that. There’s no way around that problem. You’ve got to be able to take those choices on and focus your pilots in the areas where it will give you that most leverage.
Dov Zakheim: [00:45:32] I’ve served on three commissions and for this particular area, I don’t think the commission is what you want. First of all, we’ve got a defense business board that looks at these things as well.
We have pilot programs and the key is what Jamie just said. We’ve got, if you’re serious about experimentation, you’ve got to recognize that experiments fail. And that’s that ties in with moving the money around and with trust with Congress, if an experiment looks like it’s failing you do. If I were the comptroller at that point and I could do it, I would go to the Hill and I’d say, look, this thing is failing.
I want to move the money around. I don’t want to go through a formal process. I’m just telling you, that’s what I’m going to do. So I don’t blind you. And then I moved the money. To something else. Now, the one other thing that’s critical here, and again, this is an HR problem. If people are scared to experiment because they think they won’t get promoted, unless they are quote unquote succeeding, they’re not going to do anything.
And this has hamstrung the department for decades, our whole promotion system, presupposes that, like an OER. Every OER says that this particular officer’s the greatest thing that ever came to him on the face of the earth, promote him yesterday, promote her yesterday. That’s nonsense.
People should be promoted on the basis of doing what their job demands. And if it demands experimentation, then the issue isn’t whether you passed or failed, the issue is whether you dare to experiment. So there’s that element as well. I think that needs to be built into these considerations. Great.
Jerry McGinn: [00:47:04] John,
John Young: [00:47:05] I’ll try to be brief and add some new value.
Congress is not going to write blank checks. So I think we need to get what is well within our reach improvement in the reprogramming threshold is and greater flexibility, and we will inherently have a lot more flexibility inside a budget. If we can do that. That’s one, I think in my time in the Pentagon, it would be amazing how many things wanted to be joint.
And how much the services resists that. And the Congress has been on that bandwagon. Everyone wants to cut the joint agencies and the joint, this and that. And the other thing, if I wanted to do some pilots, I would try, I think there’s a room and a need, and this would take an hour to discuss why the services resists these things.
One, they don’t want to be the ones that change. They don’t want to budget for the change dada, but when we did things like biometrics and em, rap, There are more things like this, join us in radar systems, join us in AI probably. And there are things that want to be done at a joint level and shared across the services.
And the services don’t react really well to that. And those are the kinds of pilot things I would want to path find our way through because that’s going to be the future. Eventually we’ve got it. Some things are going to ships are going to be in the Navy and fighter jets are going to be an air force and ground vehicles in the army.
But there are some cross cutting things that want to be done at a joint level and the enterprise has failed to do those well. And some pilots in that space I think are well, worthwhile. Great.
Jerry McGinn: [00:48:37] John dove. Jamie, thank you so much for your comments and great discussion. Ellen. You’ve been following along.
There are a couple of takeaways I’ve got, I want to turn to you first. W what sort of impressions do you have going forward from that discussion? Thus far, a big headlines.
Ellen Chang: [00:48:51] Yeah, thanks for that. Just a couple things. I think some total trust crossed and trust, three, three things. And really what struck me was to get budget.
There has to be budget, credibility, have dialogue. And I really love this idea of making the budget transparent between both Congress and the Pentagon. I think maybe the Pentagon’s it structure might not help with that, but so there needs to be done with that. But otherwise sum total is, yeah, we have to rebuild back trust so that we can actually be more flexible.
Great.
Jerry McGinn: [00:49:21] I think it was great. I had the same takeaway and I really liked Jamie’s picture of a mosaic. We don’t need to change the whole budget process to to advance the areas, what we need to advance. We need to really do more pilots have better data visibility, increasing trust and share insights. So take care and thanks everyone.
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