Here are some excerpts from a good long-form article from from Lauren Williams at FCW, Why DOD is so bad at buying software:
It can take years for DOD to make it through the process for buying technology — whether it’s software to operate a fighter jet, tactical radios or the latest version of Microsoft Office — and by that time, the technology can be out of date…
During a hearing in May, Chairman Jack Reed (D-R.I.) said the Senate Armed Services Committee has been focusing on reforms to the PPBE process, which has been in place since the 1960s. “It was a model that was appropriate for the Industrial Age, but we’re in a post-Industrial Age,” he added.
It was good to see PPBE reform figure prominently into the article since it creates the overarching governance structure that drives the rest of the acquisition process. One of the great challenges is the concept of a program of record, where more than 50 offices participate in setting a fixed technical baseline and estimating cost and schedule targets that reflect upon performance. This whole construct of a fully-formed lifecycle program may have worked for incremental hardware upgrades, but is antithetical to iterative development processes that predominate commercial technology practices. Here’s a quote from the NatSec Commission on AI:
“Adherence to cost, schedule and performance baselines is rarely a proxy for value delivered but is particularly unsuited for measuring and incentivizing the iterative approaches inherent in AI and other software-based digital technologies,” the NSCAI report states.
You can say that again. Luckily, the Software Acquisition Pathway now uses “value assessments” as a replacement to the metrics found in an APB. I’ll be interested in learning more about how these assessments are conducted.
The problem of the “iron triangle” of cost-schedule-performance is that, in order to minimize risk, legions of planners get involved to create the baseline. The officials in the program office as reduced to “funds obligators” who follow the standing orders inherent to the plan. This effect of putting the workforce into a “fishbowl” and frequent turnover of duties as created a deleterious effect, as former CSO Nicholas Challain noted:
“It’s not just money, it’s talent,” Chaillan said. “We keep saying we have more money than China. No, we waste 90 cents on the dollar, so we don’t really have more money than China.”
Not everyone interviewed agreed that there needed to be an overhaul of the budgeting and acquisition systems:
Terry Halvorsen, former DOD CIO and now general manager of client and solutions development for the federal and public sector at IBM, told FCW he doesn’t think major acquisition or budget reform is the answer… Overhauling the budget planning and acquisition processes could do more harm than good, he added. Instead, DOD needs “a way to be able to better address the fact that in today’s world, we’re really not going to be able to predict the technology future.”
This comment doesn’t really make sense from the view of administrative history. The PPBE process was put in place on the explicit assumption that the future of technology could be predicted. There was no “requirements-pull” approach to acquisition prior to PPBE. And similarly, all proponents of the PPBE understood that a systems analysis what the other side of the coin. As PPBS founder Charles Hitch wrote in 1960:
Economic efficiency demands that alternative programs, of different sizes and using qualitatively different weapon systems, be costed prior to the selection of the preferred program.
It’s worth repeating that the entire point of PPBS was to analyze alternative programs, select the single best approach, and minimize variance to the baseline plan. It was not expected that there should need to be significant changes or new starts over the course of years. That would signify a failure to plan and analyze.
And here are some comments from me, responding to the idea of the “colorless” pilot appropriation for software being an answer to the DoD’s problems:
Eric Lofgren, a research fellow at the Center for Government Contracting at George Mason University’s School of Business, said the pilot programs don’t give DOD enough flexibility to move money as needed.
“When you pull the funds out of [operations and maintenance] and then you put them into basically a research and development line item,…you’ve basically closed off that flexibility to reallocate funds between programs in the O&M phase,” Lofgren said. “Within an appropriation, you still have program elements, [and it’s] very difficult to move money between those program elements. Flexibility between programs is potentially more important to the department in terms of its ability to access technology and scale technology quickly and in a relevant time frame.”
Still, Lofgren praised the pilot effort and said pairing it with the software acquisition pathway could result in more effective use of DevSecOps. He also noted that the Air Force’s Kessel Run software factory could potentially join the pilot program. The recently released Kessel Run All-Domain Operations Suite allows the software factory to continuously push out code to users for testing in an operational environment so developers can get quick feedback.
The point about the “colorless” appropriation merging RDT&E, Procurement, and O&M is kind of nuanced. I’ll just say that the median O&M account in the FY21 base budget was $215 million. So those responsible for execution could move their money around within pretty broadly stated missions to support software operations, such as buying a license and maintenance.
But in the RD&TE accounts for FY 21, the median program element was just $29 million. Money is mostly locked into these narrowly stated projects. So pulling funds out of a broad program element in O&M and forcing into a narrow program element in BA 8/RDT&E is actually reducing flexibility for the enterprise overall (even if the single software program gains some of flexibility).
And here’s some good discussion from my boss:
Jerry McGinn, executive director of George Mason University’s Center for Government Contracting, said he expects to see more acquisition pilot programs focused on data-intensive capabilities, but that expansion could lead to a tug-of-war between DOD and Congress.
“You’re going to see the tension between executive and legislative branches,” he said. “The executive branch is going to want maximum flexibility, and Congress is going to not [want that] because they want oversight.”
McGinn also predicted that a successful, expanded acquisition reform effort at DOD could fuel a burgeoning interest in undertaking major budget reform. “It’s going to be hard to totally junk [the PPBE process]; there are too many vested interests,” he added. “But maybe that is the right answer…. The way we do things makes it hard to [buy] software and these new technologies.
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