We live with a set of acquisition rules as far as pace goes that probably fit the Cold War era very well. When you look at the threat at that time, moving at 3, 5, 10 year pace was acceptable. Most of the equipment at that time lent itself to long lead and long build times. Physical stuff you can touch and see. In the digital age, that doesn’t work well. Putting us on a 5-year POM cycle for funding, for example, makes it really challenging to identify a set of capabilities and requirements, lay out a 5 year plan of spending, and we end up getting yesterday’s technology delivered tomorrow. By the time those funding streams come through and you execute those contracts, in many cases they technology has been surpassed.
Congress has reached out to us and discussed options that they’re looking at. In the crudest sense, I’d say something akin to an investment capital fund which the DoD doesn’t have. Money that could be earmarked — multi-use money — so it’s not too specific but allows that to be spent quickly. We could probably move faster to retire legacy, onboard modern things, as well. I think there might be some appetite to explore things along those lines.
That was Lt Gen Dennis Crall, J6 C4/CIO and head of DoD’s JADC2 effort, in “The future of battlefield command and control.” It’s interesting LTG Crall chose to talk about the importance of funding flexibility for JADC2. Of course, JADC2 is primarily a technology implementation problem which is governed by the acquisition process. And as I’ve argued on this blog for a couple years now, the biggest impediment to accelerating technological process in defense systems is the PPBE process. This link needs to be made clear: JADC2 effort will stumble along and possibly fail without reforming the PPBE process.
The most destructive part of that is the second “P,” programming, found in the POM process LTG Crall referred to. The entire rationale was an economics exercise. If I know the laws of nature and rules of mathematics, then I can design the optimal system to satisfy a given set of user preferences. Those user preferences are also perfectly defined, because military officers can articulate exactly what they need in terms of performance. That can be translated into size, weight, power, computing, which then has known costs if we look hard enough.
All this prediction happens first (perhaps 1 to 4 years), and then enters the PPBE process which can take another 2 to 5 years before a wedge with funding is received. You can imagine in that time how many people the program has been handed off, modified, goldplated, etc., before final approval is made. You can also imagine how many technical advances or changes in the enemy threat happen. Yet oversight refers back to that original plan as a measure of “truth” and success. No one wants to go back through that requirements process and open up again questions of budget. And thus, there is no optionality or ability to learn in the development process.
That’s how America loses in Great Power Competition. Period.
I disagree with LTG Crall that the existing PPBE system was “probably” right for the Cold War. It was always wrong in my mind. Portfolio management was always right, and indeed financial flexibility existed prior to the 1960s. However, for the last 60 years, the US was just lucky that it still had a dynamic, market-oriented private sector. It brought efficiency to the Pentagon. The USSR did not enjoy this immense advantage. (For a time, the USSR’s military followed more market-like principles than did the US!) Today, China largely has a capitalist economic system.
I’ll take this a bit farther. The mid-20th century infatuation with Taylorist planning methods, commonly referred to as waterfall planning, was also a parasite that led to the decline of great American companies in the industrial sector. Lean manufacturing started in Japan while US companies focused on financialization.
It wasn’t until several years into the 21st century that American industrial companies, threatened by new agile enterprises, had to reform their business models. FinTech is upsetting the financial sector. Tesla is upsetting automakers. Amazon is upsetting retail. SpaceX is upsetting the space industry. Netflix is upsetting entertainment. 3D printing firms are upsetting mom and pop machine shops. And on and on.
That competition is something DoD has lacked. It remains to be seen whether Congress and DoD can muster up the willpower to take on PPBE reform without a catastrophic event precipitating it.
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