Rep. Mac Thornberry’s proposed acquisition reform bill is a bold and innovative attempt to solve two major problems with how the Department of Defense plans for and buys major weapons systems. (Thornberry introduces a prototype bill for committee discussion later today. The Editor)
First, this bill from the chairman of the House Armed Services Committee has the potential to radically speed the fielding of new capabilities in mature systems by planning for the systems and components of a major weapons system to be upgradable from the start. Each Major Defense Acquisition Program (MDAP) started after October 1, 2018 would be designed so that major system components would be built around a modular open systems architecture with a standard interface, allowing new and improved capabilities to be added in a plug-and-play approach.
The value of planning for upgradability is especially great for large, costly programs with long lifespans, like ships and planes, where the rapid pace of technological innovation means that the avionics in one airframe may be upgraded a dozen times. Standardizing an open systems architecture lessens the technological risk, allowing new capabilities to be added without forcing the program back to the systems integration drawing board. The Air Force is adopting the modular open-architecture approach for the new Long Range Strike Bomber, now designated the B-21. With the B2-A bomber currently projected to remain in service until 2058, after debuting in 1993, ensuring its successor can incorporate faster, cheaper capability upgrades at lower technological risk is a smart move.
Having an open systems architecture also allows the component and systems upgrades to be competed, spurring greater technological innovation and lower costs. By contrast, the current closed-architecture approach means than winning the initial production contract for a system guarantees the winning company decades of additional revenue as capabilities are updated in the future. This encourages a win-at-all-costs mentality where companies underbid the initial design and production to secure the long-term, high-margin technical support that gives them predictable revenue streams for decades to come.
ARCI
The Navy’s Acoustic Rapid COTS Insertion program (ARCI) is a flagship example of the success of an open-architecture approach. In the mid-1990s, the Navy was faced with a declining acoustic edge over foreign submarines, but had a shrinking RDT&E budget. By shifting to an open-architecture approach, the Navy was able to keep its existing submarine sensors, but have an open competition for new and improved signal-processing capabilities every two to four years. Spurred by the recurring chance to win the contract, companies are incentivized to keep improving their computers and algorithms. The Navy was able to continuously improve the capabilities of its existing fleet, and at a cost that was an impressive order of magnitude lower — from about $150 million per boat to $15 million per boat.
Second, the services will be encouraged to adapt an agile, fail-fast approach to experimentation and rapid prototyping to meet high-priority needs, add new capabilities, or address capabilities gaps with an adversary, coupled with an acquisition pipeline to bring these developments from the lab to the field fast. Currently, getting a new program created as a program of record in the budget and funded by Congress often takes upwards of two years, due to the lengthy budget development and appropriations processes. In a world where new smartphones come out every six to 12 months, senior defense officials have argued that maintaining our military’s technological superiority means we can’t afford to wait that long.
Creating a rapid experimentation, development and procurement pipeline to avoid this lengthy lag time is high-risk, but potentially high-reward. The successes of the Air Force’s Rapid Capabilities Office and the Army’s Rapid Equipping Force, are a testament to the fact that rapid development and fielding can be done. Each department would have a portfolio of experimentation RDT&E funds, organized across capabilities or weapons systems. Focusing on portfolio areas where capability improvements would give the biggest bang for the buck, projects within each portfolio would compete with each other for funding, spurring fast, achievable, and creative approaches. Projects would be chosen through a merit-based selection process, similar to how the military manages its successful medical research programs. Prototype capabilities would be able to be rapidly fielded by the service acquisition chief through low-rate initial production using leftover unobligated procurement funds.
This proposal is well-thought out and designed to avoid likely pitfalls. Using unobligated procurement funds is an elegant solution: it allows initial production much faster than the two-year budget process, and means that the new project has to be a more attractive proposition than any of the service’s other procurement priorities. Limiting initial development funding to $5 million and three years, and low-rate initial production funding to $10 million and two years, this prototyping and experimentation pathway is structured to prevent it from becoming a back-door workaround to the regular acquisitions process Modest funding also means that the cost of failure is low. Regular reporting to Congress about priority areas and projects funded will also increase transparency and enable oversight.
In buying weapons systems, failing early is much better – and cheaper – than failing late. However, both the Defense Department and Congress will have to adopt a more open, agile, and innovative approach – one that necessarily involves the failure of some projects and ideas. But done right, these proposals will allow DOD to benefit from greater competition and rapidly incorporate innovations and technological advances, keeping our formidable technological edge sharp.
Katherine Blakeley is a research fellow at the Center for Strategic and Budgetary Assessment. She was a defense policy analyst at the Congressional Research Service and the Center for American Progress.