Business group urges reform of Pentagon contract requirements process

In a comprehensive acquisition reform report released on Monday, a business group called for a more interactive requirements development process for Pentagon procurements.

The report by Business Executives for National Security identified three primary areas for reform: requirements determination, acquisition workforce and program execution. While all these areas are interrelated, the report noted that establishing solid requirements is the foundation of a successful acquisition.

"A bad beginning nearly always portends a bad ending," the report stated.

BENS is a nonpartisan group that aims to improve national security using successful models from the private sector. According to the group's Web site, the deputy undersecretary of Defense and undersecretary for acquisition, technology and logistics in 2008 invited the organization to scrutinize the issue of acquisition reform. It formed a task force to do so in the fall of 2008.

As it stands now, requirements are established primarily by asking warfighters what they need, former Lockheed Martin Corp. chairman Norm Augustine said during a media briefing on Monday. While this is important, developing requirements should be an interactive rather than declarative process, he said.

The existing requirements process does not link needs for specific future systems with an overall national defense strategy, nor does it take into account input on what is technically and financially feasible, said Augustine, who chairs the BENS Task Force on Defense Acquisition Law and Oversight. As a result, the report stated, performance overshadows cost and affordability is rarely considered.

Government systems engineers and cost analysts must be brought to the table with combatant commanders early in the process to discuss cost and technical achievability, according to Augustine. "It should be iterative between people who know what we need, people who know what we can build and people who know what we can afford," he said.

The Pentagon also must gain in-house cost estimation and engineering capabilities it currently lacks, the group concluded. BENS Chief Executive Officer Chuck Boyd said Congress and the Pentagon have allowed a personnel system to develop that essentially forces expertise to migrate to the private sector. The government must eliminate the disincentives to serve, Boyd said.

While Defense Secretary Robert Gates has announced that he intends to significantly beef up the department's workforce, BENS urged thoughtful hiring. "Twenty thousand people with one year's experience are not the same as 1,000 people with 20 years' experience," Augustine said. "You need people with scar tissue."

By increasing front-end capabilities and requirements development, the government could step into a more oversight-focused role over the course of the contract, Augustine said. "Industry could serve [the Pentagon] better if it had talent in those areas," he said. "If the government had more capabilities on the front end, it could rely on business on the back end."

The report made a number of recommendations to Congress, including codifying the responsibility of combatant commanders to manage short-term requirements and of military service chiefs to identify long-term force-shaping needs. In what Boyd identified as a long shot, the industry group also recommended funding based on acquisition milestones, rather than fiscal years.

As a whole, the report focused on what Congress can do to provide "air support" to the Pentagon. "The key really is in the Congress of the United States," Boyd said. "There's only so much a secretary can do. He can't overcome laws."