Introduction

i

DEFENSE ACQUISITION UNIVERSITY

THE FALCON AND

THE MIRAGE:

MANAGING FOR

COMBAT

EFFECTIVENESS

B. A. (Tony) Kausal, IV

November 2001

PUBLISHED BY THE

DEFENSE ACQUISITION UNIVERSITY PRESS

FORT BELVOIR, VIRGINIA 22060-5565
The Falcon and the Mirage: Managing for Combat Effectiveness

ii

For additional information contact:

Defense Acquisition University Press

(Tel) 703.805.2248

(Fax) 703.805.2917

DSN 655-2248

ISBN 1-893833-04-7
Introduction

iii

TABLE OF CONTENTS

ACKNOWLEDGMENTS ......................................................................................................... vii

INTRODUCTION ...................................................................................................................... ix

CHAPTER 1 – THE FRENCH NATIONAL MILIEU ......................................................... 1-1

The Political-Military Environment ............................................................................... 1-1

Executive Branch ............................................................................................................ 1-2

Legislative Branch .......................................................................................................... 1-3

The Ministry of Defense....................................................................................................... 1-3

DGA: Role and Organization ............................................................................................... 1-4

Two Directorates in Charge of International Activities .................................................. 1-6

Two Directorates in Charge of the Management and Human Resources ....................... 1-7

One Directorate in Charge of Survey and Trials ............................................................ 1-7

One Directorate in Charge of Industrial Activities ......................................................... 1-7

New Armament Policy.................................................................................................... 1-7

Acquisition Planning ...................................................................................................... 1-8

Acquisition Program Management ....................................................................................... 1-8

Major Programs .............................................................................................................. 1-9

Permanent Executive Committee ................................................................................... 1-9

The Acquisition System ........................................................................................................ 1-9

Integrated Product Teams ............................................................................................. 1-10

Planning, Programming, and Budgeting ............................................................................ 1-11

The Procurement/Contracting System................................................................................ 1-12

The DGA Workforce .......................................................................................................... 1-13

The Civil Service or Fonctionaires ............................................................................... 1-14

Typical Career Path ...................................................................................................... 1-15

Education in France ...................................................................................................... 1-15

Other Educational Opportunities .................................................................................. 1-16

Collaboration and Armament Sales .................................................................................... 1-17

Summary............................................................................................................................. 1-18
The Falcon and the Mirage: Managing for Combat Effectiveness

iv

CHAPTER 2 – THE UNITED STATES NATIONAL MILIEU ........................................... 2-1

The Political Military Environment................................................................................ 2-1

Congressional Involvement in Acquisition ..................................................................... 2-1

Congress and The Budget ......................................................................................... 2-2

Congressional Oversight........................................................................................... 2-3

The Cabinet .................................................................................................................... 2-3

Department of Defense ......................................................................................................... 2-3

Defense Acquisition Structure ........................................................................................ 2-4

The Air Force Acquisition Organization ........................................................................ 2-5

The Air Force Materiel Command ........................................................................... 2-6

The Acquisition System........................................................................................................ 2-7

The Development of Military Requirements .................................................................. 2-7

The Air Force Requirements Processes .......................................................................... 2-7

Planning, Programming, and Budgeting System............................................................ 2-7

The Acquisition Management System ............................................................................ 2-7

Defense Acquisition Board (DAB) ............................................................................... 2-10

Integrated Product Teams (IPTs) .................................................................................. 2-10

The Procurement/Contracting System................................................................................ 2-11

Defense Acquisition and Technology Workforce ............................................................... 2-12

A Typical Career Path................................................................................................... 2-13

Cooperation and Armament Sales ...................................................................................... 2-14

Summary............................................................................................................................. 2-16

CHAPTER 3 – INDUSTRY-GOVERNMENT RELATIONSHIPS ..................................... 3-1

Introduction .................................................................................................................... 3-1

The United States Defense Industrial Base .......................................................................... 3-2

Background..................................................................................................................... 3-2

Recent Trends ................................................................................................................. 3-4

The French Defense Industrial Base .................................................................................... 3-4

Background..................................................................................................................... 3-5

Restructuring and the Europeanization/Globalization of the French Industry ............... 3-6
Introduction

v

CHAPTER 4 – FRENCH MIRAGE 2000 PROGRAM ........................................................ 4-1

History ............................................................................................................................ 4-1

Mirage – The Aircraft ..................................................................................................... 4-2

Management Structure and Approach .................................................................................. 4-3

Air Force Combat Aircraft (AFCA) Division ................................................................ 4-5

Tactical Missiles Program Division (DSA/SPMT) ........................................................ 4-6

Integrated Program Teams .............................................................................................. 4-7

The Program Managers ........................................................................................................ 4-8

Program Personnel................................................................................................................ 4-9

Education and Experience ............................................................................................ 4-10

Management Practices ........................................................................................................ 4-11

Decision Making .......................................................................................................... 4-12

Reform Initiatives ......................................................................................................... 4-13

Outside Influences ........................................................................................................ 4-13

Configuration Control .................................................................................................. 4-14

Budget and Budget Process .......................................................................................... 4-15

Business Arrangements ...................................................................................................... 4-15

Summary............................................................................................................................. 4-16

CHAPTER 5 – UNITED STATES F-16 PROGRAM............................................................ 5-1

History ............................................................................................................................ 5-1

F-16 – The Aircraft ......................................................................................................... 5-3

Management Structure and Approach .................................................................................. 5-4

Aeronautical Systems Center (ASC) and Ogden Air Logistics Center (OO-ALC) ....... 5-6

The F-16 System Program Office (SPO)........................................................................ 5-7

Programs Group (ASC/YPX and OO-ALC/YPX) ................................................... 5-8

Product Group (ASC/YPV and OO-ALC/YPV) ...................................................... 5-9

Business Group (ASC/YPF, YPK, YPO) .................................................................. 5-9

Logistics Support Group (ASC/YPL and OO-ALC/YPL) ....................................... 5-9

Other Organizations within AFMC that support the F-16 ............................................ 5-10

Integrated Product Team (IPT) ..................................................................................... 5-10

The Program Managers ...................................................................................................... 5-11

Personnel ............................................................................................................................ 5-13

Acquisition Positions .................................................................................................... 5-13

Functional Discipline.................................................................................................... 5-14
The Falcon and the Mirage: Managing for Combat Effectiveness

vi

FMS Support ................................................................................................................ 5-14

Education and Experience ............................................................................................ 5-14

SPO East ................................................................................................................. 5-14

SPO West ................................................................................................................ 5-15

Training ........................................................................................................................ 5-15

SPO East ................................................................................................................. 5-15

SPO West ................................................................................................................ 5-15

Personnel Turnover ....................................................................................................... 5-16

SPO East ................................................................................................................. 5-16

SPO West ................................................................................................................ 5-16

Management Practices ........................................................................................................ 5-16

Decision-Making .......................................................................................................... 5-18

Within the F-16 SPO .................................................................................................... 5-19

F-16 Reform Initiatives ................................................................................................ 5-20

Foreign Military Sales .................................................................................................. 5-20

Configuration Updates.................................................................................................. 5-21

Outside Influence.......................................................................................................... 5-23

Business Arrangements ................................................................................................ 5-24

Summary............................................................................................................................. 5-25

CHAPTER 6 – A CONTRAST OF PROGRAM MANAGEMENT .................................... 6-1

Politics and Armament Acquisition ................................................................................ 6-2

Breadth of Defense Activities ......................................................................................... 6-3

The Way of Doing Business ........................................................................................... 6-4

Decision Making ............................................................................................................ 6-6

Why the Difference in Management Styles? .................................................................. 6-7

APPENDICES......................................................................................................................... A-1

Appendix A F-16 / Mirage Information ........................................................................... A-3

Appendix B France and United States Defense Budgets ................................................. A-5

Appendix C Organizational Information ......................................................................... A-6

Appendix D Questionnaires ........................................................................................... A-15

Appendix E Bibliography .............................................................................................. A-21
Introduction

vii

ACKNOWLEDGMENTS

This project had its genesis in the summer of

1998 when I met Ingénieur en Chef de l’Armement (ICA) Patrick Defour while attending the

National and International Security Management course at Harvard’s Kennedy School of

Government. The next spring Patrick was kind

enough to brief me on the management approach

of his program — the Mirage 2000. Having

“grown up” within the U.S. acquisition system

and our management practices, I found his

perspectives intriguing. I remember, in particular, his preference for matrix support. It was

unheard of that a Program Manager in the United

States would want matrix support! In my ideal

world, I would have been the Program Manager

with control over all my resources. There were

several other examples.

In April 2000, I proposed to Major General

Claude Bolton, then Program Executive Officer

for Fighters and Bombers, that I produce a study

of French management practices. And what better to compare than the management of one of

his programs — the F-16 — with the Mirage

2000. Both aircraft are of the same vintage and

were now settling down to mid-life “crises” with

the need to address wear and tear issues and to

incorporate new equipment to respond to new

military threats. With assistance and funding

from Mr. Blaise Durante, Associate Deputy

Assistant Secretary for Acquisition and Management, and Mrs. Darleen Druyun, Principal

Assistant Secretary of the Air Force (Acquisition and Management), this effort was borne.

This study was conducted under the auspices of

a professional exchange between two schools

— the Defense Acquisition University (DAU)

and the Centre des Hautes Etudes de

l’Armement (CHEAr). This first exchange of

acquisition professionals is part of DAU’s efforts

to share ideas and foster an environment of

cooperation.

I owe a debt of gratitude to DAU President Frank

Anderson; Ingéniur Général de l’Armement

(IGA) L. Alain Roche, Director of Human Resources (Direction des ressources humaines

(DRH)); and IGA Claude Liévens, Commandant

of CHEAr for sponsoring the exchange between

our two nations and two schools. And a special

thanks goes to my sponsor and caretaker, Dr.

Gertrud Humily, Executive Director International Education, for helping with my move,

setting me up in an office, and helping me make

contacts. I also owe a special thanks to two new

friends and colleagues — Mr. Gilles Le Brishoual, Project Manager, and Madame Francoise

Novi, Public Relations — for helping with so

many other things, such as finding an apartment,

and getting ID cards. There are many others who

helped me at CHEAr for my lectures and my

office space and I want to thank them — Arlette

Lion, Lise Guénot, Stefanie Palmer, and my

friends at the Cercles du Management who made

my daily office life so easy — Elisabeth Cadiou,

Christine Gamez, and Thibauld Castillon du

Perron.

I am also indebted to the many personnel — U.S.

Air Force and DGA — who took time from their

busy schedules for my interviews and questions.

One special person I need to mention — IGA

(retired) Jacques Pechamat, former deputy

director, CHEAR — who arranged for many of

my visits and interviews and spent countless

hours explaining the history of armaments in

France, French history, and French culture.
The Falcon and the Mirage: Managing for Combat Effectiveness

viii

A special thanks goes to my reviewers. It was

truly a difficult job. I am particularly thankful

to Richard Robison, U.S. Coast Guard Contract

Law Attorney; Colonel Fred Gilbert for orchestrating the SPO review; and my “EI” buddies,

Frank Swofford, Joann Langston and Tom

Dolan. In France I want to thank Patrick Dufour

for his help reviewing the French documents,

despite taking over a new job; Bruno Berthet

for his review of the Mirage chapter; and Jean

Tisnes, who provided me not only an excellent

review, but an in-depth understanding of French

industrial policy and history. And also I appreciate Greg Caruth, Director of the DAU Press,

for his reviews and help, not only on this effort,

but also on two prior books published through

his office.

I greatly appreciate the assistance provided by

ICA Bruno Berthet, the ACFA and Mirage 2000

Program Manager, and Colonel Mark

Shackelford who made themselves and their

staffs available for interviews and for their help

in conducting this study.

Finally, a special thanks goes to my wife, Mellie,

who during the hot and humid month of August

provided the initial reading of my first drafts of

each chapter and provided constructive criticism.

While many people have contributed to this

book, the views expressed are those of the author and do not necessarily reflect the opinions

of all those who supported the project.

B. A. “Tony” Kausal, IV

October 2001
Introduction

ix

INTRODUCTION

“If a sufficient number of management layers are superimposed on top

of each other, it can be assured that disaster is not left to chance.”

— Augustine’s Law Number XVI

interests. Laws, rules, and regulations govern the

process, but technical difficulties arise in any

program regardless of its lifespan. Problems

occur whether developing new systems or just

keeping old systems up-to-date. And finally finding one’s way through the maze of laws, organizations, and politics of the Pentagon and its

acquisition system is a real challenge. This provides, as we tell our new program managers, “an

opportunity to excel.”

Purpose

This case study looks at the “hub” of activity in

the acquisition business — the System Program

Office or SPO. This will be a transnational comparison. The approach is to examine, compare,

and contrast the management methods, processes, and procedures of the French Délégation

Générale pour l’Armement’s (DGA) Mirage

Aircraft Program and the United States Air

Force’s F-16 Fighter Aircraft Program for insight into more efficient management practices.

These are not idle questions reserved for

academia, but rather real issues to be faced by

acquisition public decision makers. What is the

most effective and cost efficient structure for

managing a program office? What tasks and responsibilities does a program office perform?

Can, and should, some of these be accomplished

by industry? The bottom line question is how to

deliver a complex weapon system such as the

Mirage or F-16 at a cost the government and the

public can afford and that is militarily effective.

Over the last several decades a significant body

of writings has appeared on “management.”

Whether it is “Searching for Excellence,” “Swimming with Sharks,” or the latest tome from Peter

Drucker, the reading public has shown a thirst

for new management concepts, ideas, or trends

that will make them better managers. Occasionally, a government organization makes the list

as a well run or “excellent” organization. The

Tactical Air Command’s innovative use of quality principles under General Wilbur L. Creech

was one such organization. Within the Department of Defense (DoD) and the three military

departments — the Army, Navy and Air Force

— billions of dollars are spent to develop,

produce, field, and operate military weapon

systems. The hub of that activity, at least in the

Air Force, is the System Program Office (SPO).

Little has been written on the management

activities of a program office.

Management guru Peter Drucker said, “Size

determines complexity.” If he was correct, one

of the most difficult management tasks may be

the management of an acquisition program.1

 For

an acquisition system is large, with many players, and many agendas. To start with an American historical perspective, the framers of the

Constitution created a balance of power between

the executive and legislative branches of government, both of which have a say in what DoD

buys and the way it buys. Within DoD competing interests exist between the Services, and internally the Air Force struggles with competing
The Falcon and the Mirage: Managing for Combat Effectiveness

x

The Value of a Comparison

MIT professor, Richard Samuels, in his book

“Strong Nation, Strong Army” examined the

Japanese defense industry and its role in the

country’s economy. His opening chapter describes Japanese government practices in directing and pressuring its defense industry to produce for the Japanese Self Defense Forces.

While the book was written about Japan, his

comparisons with DoD’s practices provide

thoughtful insight into the U.S. system. Often

these comparisons afford a reader an “eye

opener.” Too often an employee is introduced

to his new organization where the “right way”

to do things is explained and demonstrated. Over

time the organization’s culture and norms provide the extent of their Weltanschauung. A comparison draws many questions. Why do we do

that? Why do we do it that way? How can they

do it? Your own system now has a different light

shinning on it. One can draw one’s own conclusions as to the relative merits and weaknesses

of different forms of political, military, and

bureaucratic organizations. But at least the world

is now seen in a newer and hopefully larger light.

The System Program Office

The System Program Office (SPO), as we know

it now, is an outgrowth of the race between the

United Sates and the old Soviet Union. First,

“the increasingly complex and multifaceted nature of developing aircraft and missiles engendered the concept of a “weapons system” encompassing a vehicle with its related airborne

and ground equipment, services, facilities, and

trained personnel required for it to operate as

an instrument of combat.”2

 Then, with the introduction of the “weapon system” concept came

the “weapon system project office (WSPO).”

“After the Soviet test of a hydrogen bomb in

1953, ballistic missile development began to

become a national priority on the scale of the

Manhattan Project of World War II.”3 Brigadier

General Bernard A. Schriever, the Atlas Missile

Program Manager at the Western Development

Division (now the Space and Missile Systems

Center near Los Angeles, California), pioneered

the WSPO concept. Later, in recognition of the

importance of other systems such as Command,

Control, and Communication (3C) and surveillance the term “weapon was dropped and it

became the System Program Office (SPO).”4

Since the concept of a “weapon system” required

all the elements necessary to go to combat, the

SPO (that managed a weapon system) also

needed to have all the elements — personnel —

necessary to deliver a new weapon system. Thus

the SPO was designed to focus on a specific

project. Whatever weapon system it was — a

B-52, an Atlas missile, or an F-16 — the program office would have all the personnel necessary to manage a program, from development

to production.

The Task

Whether it is an aircraft, naval vessel, or a main

battle tank, the management task required to

deliver “effective firepower” to the warfighter

is noteworthy. Program Mangers must deal with

real issues and problems. A recent study5 by the

Defense Systems Management College indicated the difficulty of managing a defense program when it evaluated over 30 Major Defense

Acquisition Programs. Most of these programs

encountered schedule slips and cost growth. The

average schedule slip was 45 percent, while the

average cost growth was 65 percent. Figure I-1

from their study indicates schedule and cost

overruns during Engineering and Management

Development (EMD). French programs — the

Leclerc tank, the Tiger attack helicopter, the

Rafale multi-role aircraft, and the nuclear-powered carrier De Gaulle — have also experienced

cost and schedule overruns.6

 While no similar

data exists for the production phase of U.S. systems, cost overruns are not unknown during the
Introduction

xi

initial production phases of most systems. The

F-16 and Mirage 2000 are now in their mid-life

and past the large overruns that grab the attention of legislative bodies and the press. They are

no longer in the acquisition development spotlight, which now shines so glaringly on their

replacements — the F-22 and the Joint Strike

Fighter for the U.S. and the Rafale fighter for

France. Yet, the task is perhaps as challenging

for several reasons. There is the need to modernize these front line fighters with the integration of new systems; yet as an “old aircraft,” the

challenge of maintaining them in “fighting condition” continues, even with diminishing sources

of supply for parts and fatiguing metal.

This study provides a framework for analyzing

the management practices of two acquisition

programs from two countries. It describes and

compares the managerial approach of two organizations — the F-16 System Program Office

and the Mirage 2000 Program Office. Many U.S.

studies over the years have looked at the processes, organizations, policies, and practices of

managing acquisition programs. Informal studies within the military department have looked

at the structures and tasks of program management with inconclusive results. Most of these

studies, never published, were designed to evaluate the most effective method to organize a program office. What are the types of people? What

is the proper size? What tasks are more efficiently performed in industry and others? From

a historically perspective, the United States has

always had larger program offices than other

countries. Figure I-2, from a 1972 Rand study,

Figure I-1. Cost and Schedule Overruns during Engineering and

Management Development (EMD) of 30 Major Defense Acquisition Programs

AMRAAM

B-1B

Maverick

FMTV Tomahawk

ASPJ

JTIDS JSTARS

SFW

Longbow

Apache within 100%

overrun of

cost and

schedule within cost

and

schedule

3.00

2.50

2.00

1.50

1.00

0.50

0.00

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50

Ratio of Actual to Planned EMD Cost and Schedule

Ratio of Actual to Planned EMD Schedule

Ratio of Actual to Planned EMD Cost
The Falcon and the Mirage: Managing for Combat Effectiveness

xii

indicates the difference in approach staffing a

program office between U.S. and European

defense organizations. Probably this is the

bottom line — “Is bigger better?”

Thoughts on Management

Management is rewarding when success is

achieved, but there are also frustrations, complications, contradictions, and politics. For a

Program Manager pressures come from many

sources. Legislative leaders want to know why

this or that was done, operational commanders

want to know when it will arrive, or when it arrives why it does not work like promised. The

press is looking for a good story and reports of

program failures make “good press.” Success

rarely makes news!

What do I mean by management approach —

the who, how, and why — or said differently,

the organization’s structure, functions, processes, and procedures. What types of risk takers are they? What are the tasks, responsibilities, practices each country uses to develop field

and update major weapon systems? What types

of personnel work in a program office? The

traditional approach to defining management

tasks is to divide them into four categories —

Planning, Organizing, Controlling, and Activating. While this study looks at all of these activities to provide an adequate comparison, the

primary focus will be on the organizing and

planning functions.

In the United States, the SPO organization has the

cost, schedule, and performance responsibility

Figure I-2. Aircraft Development Experience (West European and United States)

Berrier Jaguar Lightning Mirage Mirage

(Kestrel) B.A.C.) Viggen (P-1B) IIIA IV F-111A

Performance (Mach) .9 1.6 1.8 2.2 2.2 2.2 2.3

(VTO)

Manning:

Engineering Staff 106-330 320 650 400 50 70 4000

to

Experimental Shop 350+ 300 350 300 300 400 6000

Program Office 24 35 20 20 10 12 220

(Government)

Months from

Design Start to:

First Flight 22 54 43 34 16 17 25

First Production

Item Delivered 48 64 96* 45 38 54 58

Number of

Test Vehicles 13 6 6 5 3 4 23

Development

Cost Factor 1.0 1.1 1.3 1.4 1.0 1.1 1.8

* Includes 24-month schedule stretchout to reconcile a changed threat estimate with altered barrier constraints
Introduction

xiii

for the development, production, and maintenance of weapon systems. The resources a program office uses are time, people, space, money,

and materials. The actual work of research, development, production, and maintenance are performed both in-house by government laboratories and depots, and by companies that specialize

in developing and building defense equipment.

Audience

This study was written for several audiences.

The primary audience is the leadership of the

acquisition community in both the U.S. Air

Force and the French Délégation Générale pour

l’Armement’s (DGA) and their two schools, the

Defense Acquisition University and the Centre

pour Haute Etudes de l’Armements. This study

will provide defense acquisition students in

France and the United States and in other countries with a comparative approach to meeting

the complex tasks of developing, manufacturing, and supporting first-line weapon systems.

Finally, for students of comparative politics,

governments, and public administration, this

report provides a structured approach to understanding defense armament organizations and

their operations.

Book Structure

This report looks at the major political and military acquisition characteristics of the two countries, and provides an overview of their organizations and processes. A useful starting point

for understanding an organization is to look at

its organizational structure. An organizational

structure indicates where activities take place,

how the management system operates, and indicates where authority and responsibility rest.

The managerial system, which includes formalized policies and procedures, guides the activities of the acquisition organizations. It also

provides an understanding of how the system

operates.

The book is structured into six chapters. As “no

man is an island,” so no program office operates in a vacuum. The national and international

political environment, history, cultures, bureaucratic traditions, and military needs all play a

role the operation and management of a weapon

system program office. Chapters One and Two

provide a brief introduction of the political and

bureaucratic systems in which the program office operates. They look at the political milieu,

the culture (national and bureaucratic), education, the bureaucratic system, and the business

environment. Chapter Three provides a look at

the differences between the two countries, specifically the ways in which the legal and political systems relate to the relationship between

the government and industry. In the case of

France the close relationship between the state

and defense industry, “has played a crucial and

all pervasive role...in determining the major

directions in which business activities have

moved.”7

Chapters Four and Five provide an analytic and

descriptive look at the structural, managerial and

personnel approaches of each program office.

They try to answer the following questions.

What are the military and civilian roles? What

type of education and training do they provide

their acquisition personnel? How does each

country manage a major program? What are the

influences of higher headquarter organizations

on the program office? What role does the budgeting and planning systems play in day-to-day

operations? How does the contracting process

impact operations? What is the role of competition? How do they approach source selection?

What types of contracts do they use? What type

of oversight do they perform on their contractors? A specific area of interest will be the tasks

performed by program office personnel. Examples include configuration management, contracting, test and evaluation, acquisition logistics, foreign sales, and the repair and maintenance of aircraft. Finally, Chapter Six provides
The Falcon and the Mirage: Managing for Combat Effectiveness

xiv

a comparative look at the acquisition systems,

program offices and the management methods

employed in overseeing a major defense system.

Culture

Our culture is us! “From the day we are born

(using a computer as an example), we have

“mental programs” that affect the way we think,

the way we do things.”8

 This also affects the way

we work, how we respond to our bosses, how

we expect decisions to be made, and the types

of organizations in which we feel most comfortable — put more simply — what we see as

right or wrong. What does this mean to the

study? As an author I approach this study with

my own set of “culturally bound” values. And

as a reader your “culturally bound” values will

affect the interpretations you make of each

country’s approach to acquisition management.

“This does not mean that countries cannot learn

from each other. On the contrary, looking across

the border is one of the most effective ways of

getting new ideas in the area of management,

organization, or politics. However, applying

these in one’s own setting calls for prudence and

judgment.”9

 For the purposes of this study I have

elected to use Geert Hofstede’s10 work on culture to help provide a perspective for viewing

the French and U.S. approaches to management

of an acquisition program.

He identifies four key cultural dimensions that

categorize our cultural relationships. They are

Power Distance, Uncertainty Avoidance, Individualism, and Masculinity. Power Distance

refers to the “degree of inequality” between a

“boss” and his “employee.” Looking at the extremes you would expect a very hierarchical

organization with the boss making all the decisions in a “large power distance” country. In a

“small power distance country” participative

management would be the order of the day, with

employees consulted and group decisions made.

As seen in Figure I-3 France has a much greater

“power distance” number than the United States.

This means France would be expected to have a

greater degree of hierarchy and hierarchical style

of management where “bosses” make the decision. In the United States, you would expect to

find more consultative style of management. The

next category, Uncertainty Avoidance, can be

translated into the question, “How much risk

does one want in one’s life?” As shown in Figure I-3 an individual from the United States is

willing to tolerate more risk in his or her work

than someone from a French organization. By

creating rules and providing stability in the job,

we can control risk. What is also interesting is

that, while there is a desire for the creation of

rules, the implementation of the rule may be less

strict in a high-uncertainty avoidance country,

as in France. At the extreme, employees want

decisions to be made by the “boss” rather than

by taking a “risk” and making the decisions

themselves. In a lower uncertainty-avoidance

country, such as the United States, you would

find employees more willing to live with an

Power Distance Uncertainty Individualism Masculinity

Avoidance

US 40* 84 91 62

FR 68* 86 71 43

* scale is 1 -100

Figure I-3. Culture Comparisons
Introduction

xv

organizational structure in which subordinates

have two direct bosses (in a “high uncertaintyavoidance” country this is to be avoided).

Individualism refers to the way a person is

allowed to deviate from the norm. Is the work

effort of Francoise perceived as creativity or as

destructive to the activities of the organization?

Both the United States and France score relatively “above average” on the scale, with the

United States having a higher degree of individualism (near the top). France is a contradiction in this sense since in a large power distance

county one typically would not expect to find

significant individualism. The ‘yin or yang” or

“Masculinity” or “femininity” of society refers

to the “the predominant socialization pattern for

men to be more assertive and for women to be

more nurturing.”11 What does this mean to the

organization? A survey used by Hofstede shows

“near consistency on men’s scoring advancement and earnings as more important, women

interpersonal aspects, rendering service and the

physical environment as more important.”12

Countries have “masculinity” characteristics.

Both France and the United States are in the

middle of the scale, although the United States

has a greater degree of masculinity in its culture. This mean that United States would favor

more “bottom line” thinking than a French

organization.

“There is a well-known joke in Britain that

everything is permitted except that which is

forbidden; in Germany everything is forbidden

except that which is permitted; and in France

everything is permitted, even that which is forbidden.”13 Culture colors our thoughts and

actions. These few paragraphs have attempted

to provide a setting for viewing the following

chapters and remind the readers of both the

author’s and the reader’s cultural outlooks.

Summary

In France and the United States, defense is big

business and each country continues to allocate

significant amounts of their national resources

for the security of the nation. With competing

demands for newer and better weapon systems

versus domestic needs, acquisition organizations

from both countries will keep the spotlight on

cutting the costs of new and existing weapons.

Montesquieu said “that at the birth of political

societies, it is the leaders of the republic who

shape the institutions but that afterward it is the

institutions, which shape the leaders of the republic.”14 Organizations mold behavior, but the

organizations were created for a variety of reasons to include ideology, cultural constraints,

and history. What is the effect of political and

bureaucratic institutions on the acquisition system? What special problems arise from public

accountability and political control? Within this

environment, the business of meeting the future

armament needs of the military continues. How

do they do it?
The Falcon and the Mirage: Managing for Combat Effectiveness

xvi

ENDNOTES

1. From Peter Drucker, Management: Tasks,

Responsibilities, Practices, Harper & Row

Publishers, New York, 1985, pg. 639.

2. Benson, Lawrence R., “Acquisition Management in the United States Air Force and Its

Predecessors,” pamphlet, Air Force History

and Museums Program, 1997, pg. 24.

3. Benson, pg. 26.

4. Benson, pg. 30.

5. Reig, Raymond W., Charles K. Gailey III,

Major William J. Swank, USAF, Dr. Paul A.

Alfieri, Commander Mark L. Suycott, USN,

“Department of Defense Acquisition Management Metrics,” DSMC Press Technical

Report, TR 1-99, October 1999, pg. 5-3.

6. Unterseher, Lutz, “Europe’s Armed Forces

at the Millennium: A Case Study of Change

in France, the United Kingdom, and Germany,” at the International Study Group on

Alternative Security Policy (SAS), a PDA

Guest Publication, December 1999 (from

http://.nyu.edu/globalbeat/), pg. 24.

7. Gordon, 1996:1 in Barsoux, Jean-Louis and

Peter Lawrence, French Management: Elitism in Action, Cassell Publishing, Wellington

House, 125 Strand, London, 1997, pg. 9.

8. Hofsteder, Geert, Cultures and Organizations, Software of the Mind: Intercultural

Cooperation and its Importance for Survival,

McGraw-Hill Book Company, London,

1991, pg. 370.

9. Hofsteder, pg. 374.

10. Hofsteder, pg. ?.

11. Hofsteder, pg. 261.

12. Hofsteder, pg. 261.

13. Hofsteder, pg. 317.

14. Jean-Jacques Rousseau, The Social Contract, translated by Maurice Cranston

(Harmondsworth: Penguin Books, 1968),

pg. 87.
Chapter 1 The French National Milieu

1-1

Chapter 1

THE FRENCH NATIONAL MILIEU

French politics and foreign policy for the last

half of the century. France was to reassert her

role on the world stage. In support of this policy,

the country needed the ability to act on its own

and that meant strengthening the military (including a nuclear capability).1

 It also meant

developing a defense industry and marking its

independence from the NATO integrated military command structure, although it still remained a member of Atlantic Alliance.

Under the Balladur government much of the

framework structured by De Gaulle for national

autonomy was “swept away in the space of a

few pages”2

 by the 1994 Defense White Paper.

Now, coalition warfare and the ability to “command in situations — where “political, military

and regional dimensions mingle”3 — was part

of the military and national doctrine. The French

government’s military perspective now must be

seen in light of its political commitment to the

European Union. It helped create the European

single market and has supported the European

The Political-Military Environment

The French Revolution sowed the seeds for the

style of French governments that sprouted in the

19th and early part of the 20th Century. The

belief in a Republican form of government provided the philosophical tenet for a strong legislature with a weak executive. Many, and in particular General Charles De Gaulle, felt that it

also resulted in a more chaotic government and

finally, to France’s defeat in World War II. After the War, this instability continued during the

13 years of the Fourth Republic, from 1945 until 1958, with France having 26 different governments during that time. Then, threats of

insurrection, and even a threat of a coup d’etat

with French Algerian troops landing in Paris,

contributed to the fall of the Fourth Republic in

1958. General De Gaulle was called out of retirement to take the reins of government. Under

his direction a new constitution was drafted and

submitted to a popular referendum. On 28 September 1958, the French people accepted the

Constitution of the Fifth Republic. In line with

De Gaulle’s character and beliefs, this new constitution gave the foremost role to the President

of the Republic, a role in which he was invested

by the college of deputies, senators, locally

elected officials and later by the French public.

“Old France, weighed down by history, bruised

by wars and revolutions, going back and forth

without respite from greatness to decline, but

recovering, from century to century, through the

genius of renewal.” This proclamation by De

Gaulle captures his vision of France. It was time

for renewal and for France to again be a world

player. This vision also provided the pattern of
The Falcon and the Mirage: Managing for Combat Effectiveness

1-2

Union’s (EU) fiscal policies including creation

of the new currency — the Euro. It has been a

supporter of the EU’s political and diplomatic

cooperation efforts. It has been a major driver

for a European common defense policy and a

European army.

This chapter provides the governmental framework and the political and bureaucratic environment that influences the decisions made in managing a major defense program, the Mirage

2000. The parliament, the executive branch, the

Ministry of Defense, the military services, the

national aspirations, the culture, as well as the

idiosyncrasies of the personnel involved — all

play a role in decision making. With this conceptual backdrop, and after a look at French

industry in Chapter Two, Chapter Four will

provide a detailed look at the management

practices of the Mirage 2000 program office.

Executive Branch

The Fifth Republic has provided for institutional

stability unequalled in the two preceding centuries. The philosophy emphasized by De Gaulle,

Gaullism, underscored the need for a strong

leader, who was to be the President.4

 The President, currently Jacques Chirac, is commanderin-chief of the armed forces and presides over

the Higher National Defense councils and other

committees (Council of Ministers, Council of

Defense, Restricted Defense Committee).5 The

President has traditionally played a (or the) key

role in Defense and Foreign policy, although he

shares this latter responsibility with the Prime

Minister.

The “Government” consists of the Prime Minister (PM) and the ministers of the departments.

It determines and directs the nation’s policies

and oversees the civil service and armed forces.

The government answers to Parliament. The

Prime Minister is appointed by the President and

is the “Head of the Government” and administers the government including national defense.

Within the limits6

 imposed by the Constitution,

the Prime Minister has regulatory powers that

allow him much more leeway than the United

States Constitution would allow the U.S. President. This is a fundamental point. While Parliament passes laws, which are general in nature,

the executive branch issues regulations (decrees

and ministerial orders) that have the effect of

law.

Apart from its regulatory power the government

also shares the power with Parliament to introduce legislation. Even here it enjoys an unquestionable advantage over the legislature, because

it can set the National Assembly’s agenda. Another constitutional provision again provides the

executive with the ability to pledge the government’s responsibility before the assembly —

either on its program or on a statement of general policy. The bill is then considered adopted

unless there is a motion of censure, filed in the

National Assembly, and it wins a majority of

the deputies’ votes. If this happens, the Prime

Minister must tender the resignation of the government to the President. This procedure, unique

in Western Europe, reflects the determination

of the framers of the 1958 Constitution to give

the government stability and enable it to govern

without “obstruction” from Parliament.

In the Defense domain, the PM administers national defense through the Secretariat General

for National Defense (SGDN), currently Mr Jean

Claude Mallet, and the Minister of Defense,

currently Mr. Alain Richard. The SGDN provides, at the cabinet level, strategic planning or

coordination with other ministries. The Defense

Minister is responsible for the preparation and

execution of the defense portfolio. He is assisted

by senior defense civil servants, referred to as the

“cabinet ministériel,” chosen by the minister usually from the ranks of senior civil servants.
Chapter 1 The French National Milieu

1-3

The Legislative Branch

The French Parliament consists of two houses

— an upper, the Senate (321 members who serve

9 years) and a lower, the more powerful National

Assembly (577 Deputies who serve 5 years). As

noted earlier, the traditional French parliamentary powers were severely curtail by the 1958

Constitution. However, it still performs as a legislative body and has the responsibility for passing laws to include the finance laws (budgets7

)

and for setting the state goal for economic and

social actions. The government, which is the

majority party or coalition within the National

Assembly, has the right to introduce bills (called

project de loi); as indicated earlier it can set the

agenda, which means its bills take priority in

the Assembly. The Parliament does play a role

as a check on government. The National Assembly has the power to force the government to

resign; it may do so by passing a motion of

censure.

Parliament’s specific role in defense is to pass

laws that define the defense organization, its

annual defense budget, and military programming laws. It periodically makes statements

about France’s military policy (equipment for

the armed forces), but it cannot initiate legislation in the area of national defense. And since

the parliamentary committees have small staffs;

they do not conduct the types of hearings typical of the U.S. Congress. Thus for parliament

the defense issues are generally top-level, broadbased and they never get into the detail so typical

of the United States.

THE MINISTRY OF DEFENSE

The Ministry of National Defense is organized

as shown in Figure 1-1 into three distinct

elements. The military element is composed of

the Armée de la Terre (Army), the Armée de

l’Air (Air Force), the Marine Nationale (Navy)

and the Chef d’état-major des Armée (Joint

Armed Forces Staff). The administrative side includes the Secrétariat Général pour l’Administration and the acquisition organization, the

Délégation Général pour l’Armement (DGA).

The current “Délégate Général” is Yves Gleizes,

a Polytechnician and an ingénieur général de

l’armement.

France has the fourth largest defense budget in

the world.8

 The defense budget in FY 20009 was

set at French Francs (FF) 188 billion francs

(28.66 billion Euro10) (excluding pensions), 2.5

percent of the Gross Domestic Product (GDP)

and 11.29 percent of the national budget.11 In

2001 the budget increased to FF188.9 billion

(excluding pensions) and represents 11.6 percent of the State’s budget and approximately 2.9

percent of the Gross Domestic Product. The

apparent amount of investment in modernization is high — 45 percent — when one looks at

the investment part of the budget (Title V). The

investment portion — research, development,

production and infrastructure — is planned at a

steady FF86 billion (in constant FY 1995 francs)

through 2002. However, a true comparison probably puts it closer to FF65 billion and slightly

higher than most other countries at around 30-

35 percent of the defense budget.12

France operates on a five-year defense program,13 called the “Loi de programmation,”

which sets the amount needed to meet the needs

of the armed forces. Then a yearly budget is submitted by the government and approved by the

parliament; but often it does not meet the needs

of the five-year program.14 The programming

law also had an impact on the size of the military. It required a reduction of personnel from

548,280 civilians and military in 1998 to

440,000 in 2002.15 The 2002 budget request, unveiled in July, shows a continued upward trend

with an increase of 1.6 percent from 2001 for
The Falcon and the Mirage: Managing for Combat Effectiveness

1-4

defense (to FF191.3 billion), although the modernization account FF83.516 still falls well below

the programming law’s objectives of FF86.

DGA: ROLE AND ORGANIZATION

President Charles De Gaulle created the French

Acquisition organization in 1961. He had several objectives: make France less dependent on

other countries for military equipment and create a French nuclear force (la Force de Frappe).

To create the technical capability necessary to

bear on this task, the Ministry needed to create

a “center of excellence.” It took the existing armament engineers from the military services and

created a separate branch of the military — an

armament agency — now called the Délégation

Général pour l’Armement (DGA). The concept

was to create a Corps of dedicated and technically competent individuals who, working

closely with the military services, would provide

the modern equipment needed by the

warfighting branches of military. The original

mission of this organization was to define requirements, evaluate needed research and development, manage the R&D facilities and government production plants, and buy or develop

the weapon systems for mission needs.

Historically, the DGA has performed two functions — a “state function” and an “industrial

function.” The state function manages research,

development, production, and testing of weapon

systems along with oversight of the defense industry. The industrial function includes managing entities such as shipyards and repair depots,

which are government industries. Of the three

services, the Air Force has historically relied

upon a civilian defense industry (companies

such as Dassault) to meet its needs, while the

Army and Navy have relied more upon a combination of both government and civilian industry. The new programming law, discussed later,

Figure 1-1. Ministry of Defense

Minister of Defense

Secretariat General

for

Administration

Joint Armed

Forces Staff

French Navy

Staff

French Air

Force Staff

French Army

Staff

Directorate for

Naval Construction

DNC
Chapter 1 The French National Milieu

1-5

and government policy have changed this traditional role. The relationship between government and defense industry is changing, and government industries are now becoming “profit”

making industries.

Currently there are over 19,000 (see Figure 1-6)

personnel employed at DGA organizations

throughout France. This includes personnel at

the headquarters (6,639) and test centers (9,600)

performing state functions and those performing industrial functions at aircraft maintenance

centers (3,394). DGA is specifically responsible

for managing armaments programs, buying

equipment, providing the technical and scientific expertise necessary to outfit the forces, performing trials and evaluations, and providing

initial logistics support for military equipment.

In practice DGA manages about 80 percent of

defense equipment budgets with the balance

being bought by the military services.

There are three directorates in charge of the programs (see Figure 1-3 for organizational chart):

The Force Systems and Prospective Directorate (DSP) monitors research activities, conducts common technology development, and

Figure 1-2. Locations of DGA and DCN Units

Industrial Functions

SMA – Service for Aeronautical Maintenance

DCN – Directorate for Naval Construction

State Functions

DCE – Directorate for Evaluation and Test Centers

DRH – Directorate for Human Resources

DSA – Directorate for Weapon Systems

DPM – Directorate for Programs, Procurement Methods and QA

DGO – Directorate for Management and Organization

Cherbourg (DCN)

Brest (DCN-DSA-DCE)

Rennes (DCE)

Lorient (DCN-DCE) Nantes (DPM DOU)

Val de Reuil (DCE)

Vernon (DCE)

Bourges (DCE/DRH)

Angers (DCE)

Indret (DCN) Châtellerault (DGO)

Ruelle (DCN)

Rochefort (DRH)

Cazaux (DCE)

Bordeaux (SMA)

Latresne (DRH)

Gramat (DCE)

St Médard-en-Jalles (DCE) Clermont-Ferrand (SMA)

Cuers (SMA)

Toulon (DCNDSA-DCE)

St Tropez (DCN)

Istres (DCE)

Marseille (DPM)

Odeillo (DCE)

Toulouse (DCE)

PARIS

DGA Headquarters

CHEAr
The Falcon and the Mirage: Managing for Combat Effectiveness

1-6

prepares programs for development. It ensures

technical consistency within the forces systems.

It is responsible for strategic missile programs

as well as those dealing with observation, information and telecommunications. It also provides

the technical support to program offices located

in DSA on an “as needed” basis.

The Weapons Systems Directorate (DSA) is

in charge of the design and development of land,

naval, aeronautical and tactical missiles programs. The Program Managers belong to this

Directorate; they are fully responsible for all

aspects of a program and receive support from

a “program integrated team” which includes

specialists, such as procurement and quality

control.

The Programs Management, Acquisition

Methods and Quality Control Directorate

(DPM) has responsibility for funds management,

to include budget preparation. It is also responsible for procurement, quality and logistics support. It also provides specialists, on an “as

needed” basis, to support program managers.

Two Directorates in Charge

of International Activities

The Cooperation and Industrial Affairs

Directorate (DCI) has responsibility for working European issues, such as cooperation within

the EU and OCCAR. It provides armament attaches to Germany, United Kingdom, Spain,

Italy, Greece, Turkey, the United States, NATO

and the Western European Union (WEU). It has

responsibility for industry — to include setting

industrial policy and support and development

of small and medium-sized companies. It also

has responsibility for the revamping of industry

in the new global environment.

Figure 1-3. DGA Organization

Directorate for

Human

Resources

DRH

Directorate for

Management

and

Organisation

Services for DGO

Aeronautical

Maintenance

SMA

Directorate for

Evaluation and

Test Centres

DCE

Directorate for

International

Relations

DRI

Directorate for

Co-operation

and

Industrial

Affairs

DCI

Directorate for

Forces Systems

and

Trend Analysis

DSP

Directorate for

Programs,

Procurement

Methods and

Quality

DPM

Directorate for

Weapon

Systems

DSA

Inspection

CHEAr

Assistant

Director

Armement

Programs

Délégué Général

pour l’Armement
Chapter 1 The French National Milieu

1-7

The International Relations Directorate

(DRI) has responsibility for countries mostly

outside of Europe. Its primary responsibility is

for the promotion and control of French armament equipment exports to foreign markets. It

coordinates the development and implementation of export strategy. It provides armament

attaches to Saudi Arabia, United Arab Emirates,

South Korea, South East Asia, Japan, and Russia.

Two Directorates in Charge of the

Management and Human Resources

The Management and Organization Directorate (DGO) has responsibility for management

reporting, management of the information systems, internal quality control, general planning

and budgeting, and administration.

The Human Resources Directorate (DRH)

manages the career and the training policy for

DGA.

One Directorate in Charge

of Survey and Trials

The Directorate for Evaluation and Test

Centers (DCE) has responsibility for providing the technical expertise and skills needed by

program managers and other DGA departments

for testing equipment and systems. It will also

provide support for external customers (industry, foreign governments and companies). DCE

manages all of DGA’s Technical and Test

Centers.

One Directorate in Charge

of Industrial Activities

The Service for Aeronautical Maintenance

(SMA) is responsible for aircraft maintenance

on aircraft, engines, aeronautical equipment and

maintenance of industrial facilities. Aircraft are

repaired in Clermont-Ferrand, engines in Bordeaux and naval aircraft in Cuers-Pierrefeu. The

SMA also offers services to foreign clients in

partnership with French companies.

One of the organizational changes due to restructuring DGA was the recent semi-privatization

of the Direction de Constructions Navales

(DCN), which now reports directly to the Minister of Defense. DCN is responsible for foreign

exporting of ships, and manages shipyards

located at Brest, Cherbourg, Lorient and Toulon.

New Armament Policy

As the Cold War vanished the “main threat to

the French nation...disappeared, probably for a

long time.”17 However, French policy makers

recognize that the proliferation of weapons of

mass destruction and crises, such as Kosovo,

create an uncertain world and risk for the nation.

In this uncertain world, the object is still to deter an aggressor from attacking vital national

interests. This new armament policy still includes retaining nuclear capabilities, although

nuclear testing has ceased. Of particular importance is the increased commitment by France,

and other European nations, to a common defense policy and the European Union Rapid

Reaction Force. France has several underpinnings to its relationships that influence its defense armament policy and action. They include

the North Atlantic Alliance, the UN (United

Nations), the Organization for Security and

Cooperation in Europe (OSCE), the European

Union, and the Western European Union

(WEU). In the armament arena two groups that

play an important role are the Western European

Armaments Group (WEAG) and more importantly a multi-nation armament organization

known by its French name — “Organisme conjoint de coopération en matiere d’armement”

(OCCAR) — to be discussed later. There is also

the recognition in the new armament policy

that it is necessary to restructure the defense

industry in Europe and particularly in France to

make it competitive with the American Defense
The Falcon and the Mirage: Managing for Combat Effectiveness

1-8

Industry. The relatively newly-formed European

Aeronautic Defence and Space Company

(EADS) is but one example of the changes in

Europe. And the final policy initiative is to harmonize the French export policy with the new

EU policies for exports, currently under development, while at the same time improving the

competitiveness of their exports.

Acquisition Planning

Thirty years out seems a long time, but as the

United States has found, the life of a weapon

system can easily extend for thirty years. In 1997

as part of the overall restructuring of the Ministry, the military services and the DGA began a

“long term” look at the armament planning process. Michel Bouvet, then the agency assistant

director for trend analysis, described a “30 year

prospective plan, updated yearly, which “forces

us to imagine new things. It’s a plan which will

never be finished.”18 This thirty-year forecasting plan looks beyond normal programming and

planning documents to raise questions, make

recommendations and to provide a framework

for evolving military capabilities. This “prospective approach” provides the DGA and the services with a look at the future battlefield environment and the status of technology, and helps

provide a focus for research and development

(R&D) efforts. Tied closely with the “long-term

look” is the development of a new construct

called the “System of Forces.” The “System of

Forces” approach looks at a mission area, across

the services, and assesses the military capacity

being brought to solve the problem. They have

selected eight areas: (1) deterrence; (2) command, control communications and intelligence;

(3) strategic and tactical mobility; (4) in-depth

strike; (5) controlling the air/ground environment; (6) control of the air/sea environment; (7)

control of the aerospace environment; and (8)

readiness. To provide an organizational structure for this approach they have created a senior

level position called the System of Forces

Architect (ASF), with the responsibility to look

across each capability area to fulfill those needs.

The ASF performs a role similar to the Program

Manager within the force systems, or mission

area, prior to turning over the system (see Figure

1-4) to the program manager.

ACQUISITION PROGRAM

MANAGEMENT

Two key individuals manage acquisition programs. The System of Forces Architect (ASF)19

and the Program Manager (PM). As seen in Figure 1-4 the ASF has the primary responsibility

at the inception of a program. As one Architect

said, “he has the freedom to think of the future.”

He takes a long-term, broad look — a “systems

of systems” approach — to find the most effective means — from both a cost and a military

basis. The ASF helps draft prospective plans,

makes recommendations for research and development, propose timetables and funding for

programs, and has initial responsibility for the

system through the preparation stages and feasibility phase.

The military services also play a role in the

management of programs. They define the military need. During the initial phases of a program,

the counterpart to the ASF on the general staffs

(referred to as the Operational Concept Officer

(OCO)) and the General Staff Correspondent

Officers (OCEM20) help define and monitor the

systems of forces.

Once a program reaches the Definition Phase

the key role in the conduct of an armament

program reverts to two individuals, the Program

Director from the DGA and Program Officer

from the individual military general staffs. In

the case of the Mirage 2000, it is the Air Force

General Staff (Etat major de l’armée de l’air

(EMAA). The Program Manager has the responsibility for the cost schedule and technical
Chapter 1 The French National Milieu

1-9

performance of the system. The Program Officer has similar responsibility within the Services, which he performs by monitoring the system and participating with the PM as part of the

Integration Program Team.

Major Programs

During all or a part of their implementation some

programs are classified “major” in view of their

importance, whether from a cost viewpoint or

other national considerations. They undergo

special decision procedures and their classification is mentioned in the list of armaments programs.21 Normally, for national programs, program documentation requires approval at each

phase of the process by the Permanent Executive Commission. For international cooperation

programs, a separate procedure will be used.

For some armament programs (whose complexity and importance are justified), steering

committees can be formed. Their establishment,

chairmanship, composition, role and attributions

are contained in specific instructions signed by

the minister, or jointly by the Délégate Général

for armaments and the service chief of staff.

Permanent Executive Committee

The Permanent Executive Committee prepares and publishes the list of armaments programs. They also provide recommendations on

the feasibility, orientation and launching files

and final documents of programs. Its members

include: a representative of the armaments delegate general, who chairs the committee; a representative of the secretary general for administration, vice-chairman; representatives from

the Joint Staff and the Services.

THE ACQUISITION SYSTEM22

The acquisition system23 is divided into stages

and phases characterized by the types of work

involved (see Figure 1-5). It begins with the Preparation Stage where operational requirements

are outlined, with possible solutions evaluated

with a look at their risk, cost effectiveness and

life cycle cost implications. The program officially starts during the Design Stage with its two

phases — Feasibility and Definition. To move

into the feasibility phase the ASF with the appropriate service representative prepares a Feasibility file, approved by the Minister of Defense

after it has gone through the Permanent Executive

Figure 1-4. System of Forces Architect Role

The 30 Year Forecast Plan

Integrated Team – DGA/Service Staff/Industry

Architect of Force

Systems The Programme Manager

Feasibility Definition Preparation

Development

Industrialisation

and Production In Service

Use
The Falcon and the Mirage: Managing for Combat Effectiveness

1-10

Committee. It searches for possible answers and

their assessment, in terms of the degree of satisfaction they can bring to the military requirements — still expressed in general terms. In the

definition phase the responsibility passes to the

Program Manager. This phase is entered when

one or more approaches appear to meet the military need and can be selected for a more thorough examination. During this phase the military requirements (including the need for support, environment and training, technical specifications, schedules, costs and industrial conditions) are refined. Once the system has been

sufficiently identified, it enters the next Stage

Realization and the Development Phase begins.

At this point the DGA may also commit to production or partial production. The Realization

Stage terminates with delivery of the complete

product, along with the necessary training and

support system. In principle this date marks the

end of the program, although some of the DGA’s

activities continue long afterwards.

Each Phase has the requirement for a chain of

documents — Feasibility, Orientation, Realization Launching and Production Launching

documents — which must be approved prior to

beginning the phase. These documents include

the projected cost, schedule and technical performance along with the associated risks in the

program. In addition to these specific approvals, the DGA (with the Services and the Secretary General for Administration) examines

annually the programs at the Design Stage.

In general the definition, development, production and utilization phases are reached by

decision of the DGA. However, the Minster of

Defense makes the decision when a major

program is concerned, when the permanent

executive committee is unable to make a recommendation, or the military services have

reservations.

Integrated Program Teams

One recent reform effort in the Ministry has been

the use of Integrated Program Teams. The basic

goal is similar to what other organizations are

doing — to reduce costs and timescales, increase

customer and user satisfaction. The operating

principle for the teams is to make all participants work at the same time and assemble all

the experts needed to provide optimum program

Figure 1-5. The Acquisition Process

Phases

Stages Development Production

Realization Utilization

Feasability Definition

Preparation

Design

Force Staff

Initial

Objective

Production

Launching

Document

Realization

Launching

Document

Orientation

Document

Feasability

Document
Chapter 1 The French National Milieu

1-11

support under the authority of the Program Manager. Expertise will be provided on an “as

needed” basis by the support offices, typically

within DSA — although other organizations also

provide support. Typical of the types of capability provided to program teams include:

Functional

• methods, planning, costs

• standardization

• purchasing

• integrated logistics support

• product quality

Technical Fields24

• communications

• electromagnetic detection

• structural materials

• guidance – navigation

• aircraft architecture

Figure 1-6 depicts the IPT relationships.

PLANNING, PROGRAMMING AND

BUDGETING

The 1994 defense “White Paper” provides the

overarching security precepts for defense planning, programming and budgeting. Its three main

tenets are to: (1) Defend the interests of France

(well-being of the nation), (2) Construct Europe

and contribute to international stability (play a

leading role in the integration of Europe and

contribute to the prevention of war outside of

Europe), and (3) Implement a global conception of defense (civil, economic, social, cultural

and military). From this derives four tasks for

the Ministry of Defense. They are:

(1) Deterrence – sea- and air-launched nuclear

weapons;

(2) Prevention – high-performance surveillance

technology and the stationing of troops (such

as the Foreign Legion) overseas;

(3) Power projection – involves land, air, and

maritime forces in close cooperation; and

finally

Figure 1-6. Integrated Program Teams

Experts in

Technical and

Trials Fields

Experts in

Functional

Fields

Program

Manager

Program

Team

Program

Officer

Manufacturer

Service Staffs Defence

Manufacturers

Program

Services

Trials and

Investigation

Centres

Directorate for

Programmes,

Methods, and

Quality
The Falcon and the Mirage: Managing for Combat Effectiveness

1-12

(4) The Protection of France’s domestic territories – now left to the Gendarmerie with

the absence of a military threat.

As a result of the changes recommended in 1995,

the Parliament set out the main decisions with

the 1996 Program Law. This contained the defense posture through 2015 (a twenty-year planning cycle), with more details including specific

spending levels for modernization through

2002.25

In the medium term (6 years) targets were set

for equipment and manpower. The armed services prepared a forecast on a year-by-year

schedule of the needed resources. The ministry

is required to report to the Parliament on its

progress implementing the law. The annual budget specifies the yearly program amounts to be

allocated to implement the program.

Internally within the department the Chief of the

Defense Staff is responsible for overall coordination among the services and the DGA, the

General Secretary for Administration and others and for preparing major decisions for the

Minister. Of specific concern for acquisition is

the Title V or capital investment portion of the

budget. It should be noted that the budget amount

for programs is contained within the budgets of

the various services.

The actual budget process begins in January with

a Ministry review of the yearly plan and the

amount of money needed to implement the plan.

Following the review (January-April) they revise and prepare the final budget submittals. The

Government, in particular the Minister of

Economy and Finance and the cabinet, gets involved in discussions in the April time frame.

In June the final “real” discussions take place

and an agreed-to budget is sent at the end of

June or early July to the Parliament. Parliament

reviews the budget in the July to August time

frame and the DGA responds to questions posed

by Parliament. In September the Chief of Staff

of the Air Force (and other services for their

programs) testifies before a Parliament committee to answer questions generally along these

lines: Is this enough money to do what the longterm plans require? Then Parliament votes in

October to have the money in place for the start

of the Fiscal Year – 1 January.

THE PROCUREMENT/

CONTRACTING SYSTEM26

The DGA spent approximately FF90 billion

(13.7 billion euros) in over 50,000 contract

actions in fiscal year 2000 for a wide range of

products and services to include R&D, basic and

detailed design, modeling, testing, production

equipment, supplies and support. The regulation

that governs the procurement or contracting

business is the “Code de Marché Publique,” or

Public Contracting Code. It is rather modest in

size compared to U.S. regulations. It is also relatively general and easy to understand, although

it is complicated somewhat by legal opinions

written by government lawyers on the meaning

of portions of it.

The general government policy is that competition is the rule. However, in defense the number of suppliers is low, particularly at the Prime

Contractor level. Thus the philosophy in Defense

is to move the competition to the next level —

the subcontract level. In cases where competition is possible (prime and sub) DGA’s commitment is for fair competition rules, transparency and the opportunity for the settlement of

disputes.

An acquisition plan is required for each important program and updated every 18 months.

There is also a Contractual Approach Document

(CAD) required for each contract, which provides the proposed contract particulars, such as

type of contract and duration. If the duration of
Chapter 1 The French National Milieu

1-13

the contract is less than three years, then the

prices shall be firm. For contracts of a longer

duration firm prices will be used, but with a price

escalation formula based on standard escalation

rates used for engineering and manufacturing

activities. In the past, the general strategy was

to select a primary contractor. Using aircraft as

an example, Dassault was selected as the primary contractor responsible for developing and

building the airframe and then to integrate components into the overall system. The DGA would

contract with other suppliers for avionics and

engines, and provide these as government furnished equipment (sometimes referred to as component breakout). This saved contractor overhead but contributed to problems of late government-furnished equipment and coordination

of the integration activities. A more important

reason for the use of this approach was the concern that a contractor could use the leverage of

its sole source position to vertically integrate into

its company divisions that manufactured individual components. The current strategy approach makes the Prime Contractor fully responsible for overall system characteristics (technical, price, support in service), i.e., “global system performances.” This includes a contractual

commitment by the Prime for design, industrialization, initial production, and initial logistic

support. It also includes the concept of co-contracting in which several major contractors all

sign one contract, such as an airframe, engine,

and avionics manufacturer.

If a company is unhappy with an acquisition then

they can protest to DSA, DGA, sometimes to

Minister directly or to Parliament. This can lead

DGA to reconsider the case: this rarely happens.

To reduce such cases, DGA develops for each

program a buying strategy that is approved at

DGA level. This strategy is detailed and indicates the main competitions that will take place

during the program duration, and when competition is impossible, the legal arguments to justify that approach.

In the last several years the role of procurement

as major contributor to the DGA mission has

been recognized. As a result they have created a

procurement directorate to manage and provide

a home base for developing procurement managers. The selection of buyers and negotiators

favors those primarily with technical backgrounds although every year personnel are hired

from industry because of their business backgrounds. The general philosophy is that while

the buyer may not have technical responsibility

“you cannot separate the cost away from the

technical and it is very helpful to have buyers

that understand that.”27 Their training primarily

is aimed at providing the buyers with an understanding of the rules and regulations, negotiation strategies, estimating and other tools to help

them in their jobs.

THE DGA WORKFORCE

The DGA, headquartered in Paris, employs over

19,000 personnel (see Figure 1-7).28 While it

employs 15,718 personnel in “state functions”

the actual number of personnel engaging in

acquisition (as defined within the United States)

includes about 6,043 personnel working directly

for the DGA performing “state functions.” The

balance, 9,079 personnel, are employed at

DCE’s trials and investigation centers located

throughout France. Until recently they have managed two industrial centers — the Aeronautical

Maintenance Workshop (SMA) and Direction

de Constructions Navales (DCN). SMA employees 3,394 personnel, while DCN (no longer a

part of DGA) employees approximately 16,400

personnel at various places in the country (although most are employed at the shipyards in

Brest, Cherbourg, Lorient and Toulon).29 Current figures represent a decline of 21 percent in

personnel since 1996 as part of the streamlining

of the DGA with an attempt to cut overhead

costs.
The Falcon and the Mirage: Managing for Combat Effectiveness

1-14

There are two primary categories of personnel

that work at the DGA and in the program offices — Military and Civilian (see Figure 1-7).

The Military includes armament engineers (Ingénieurs d’Armement (IA)), armament design and

technique engineers (the “Ingénieurs des Etudes

et Techniques d’Armement (IETA)) and officers

of the armament technical and administrative

corps (Officier du Corps Technique Administratif

de l’Armement (OCTAA)). The IAs generally

hold the majority of senior positions within

DGA. The other two military categories provide

personnel with a technical administrative background to support the DGA mission. Promotions for the other two categories are generally

limited to Colonel.

The Civil Service or Fonctionaires

Traditionally the government plays a considerable role in the affairs of the country. With the

responsibility to carry out the goals of the government the French civil servants enjoy a very

important social position within the country.

Starting ones career as a civil servant also opens,

particularly for the higher civil service, opportunities both in senior levels of industry and

within the top echelons of government. Many

of France’s political leaders have had civil

service careers, such as Presidents Jacques

Chirac and Giscard d’Estang, and Alain Richard, France’s current Defense Minister.

Two categories of civilians work in the DGA —

“fonctionnaires,” and contract employees. The

“fonctionnaires” are the civil servants who perform mostly two types of jobs — administrative and technological. They have three levels

of civilians.

Niveau 1 Senior level up to General Office

Niveau 2 Mostly mid level management in

law and analysis

Niveau 3 Secretaries and workers

The contract employees fall into two categories

— the ICT (Ingénieur Commercial Technology)

and ISC (Ingénieur Service Conceptual), who

are hired on contract for three to four years. This

allows the DGA to bring in personnel with special capabilities, such as lawyers and economists, at higher salaries than can be offered

to civil servants. Their number is increasing

slightly every year and it is not unusual for these

personnel to remain many years at the DGA.

Figure 1-7. Number of Personnel at DGA

State Functions

DGA 6,639

DCE 9,079

15,718

Industrial Functions

SMA 3,394

19,112

DCN 16,418

35,527
Chapter 1 The French National Milieu

1-15

Typical Career Path

Program Managers come from the IA Corps. In

France the decision to become a Program Manager actually occurs quite early in one’s life —

at sixteen years of age. While a sixteen-year old

may not know that he wants to become a Program Manager, the decision to attend one of the

exclusive “Grand Ecoles” is made at that age.

To understand the selection of individuals for

top management positions both in the DGA (and

in French organizations in general), it is necessary to start with the France’s academic system.

Education in France

After completing five years of primary school

and the first portion of secondary school, an individual is ready at the age of 15 or 16 for the

Lycée, which is three years long and provides

the “baccalaureat,” roughly equivalent to a high

school degree. In the Lycée the course to take to

move in the direction of program management

is the Bacalureate “S,” the most prestigious of

the degrees that is focused heavily on mathematics and sciences. “Mathematics is the central

feature of French selection methods in education.”30 To gain “le bac” a very competitive exam

is taken. At one time only 30 percent of the

students passed the exam, although in recent

years those passing have increased to as high as

75 percent. The “bac” is the key to higher

education. It gives automatic entry into the

university.

The top schools in France — the “Grand Ecoles”

— have no equivalent in any other Western country. Yet they are the key to future success. For

those wishing to attend, they must, after their

graduation from the Lycée and their passing of

the bac, spend the next two to three years attending a special post-bacccalaureat class. A

competitive exam then determines which school

they attend. The most prestigious are probably

the Ecole Nationale d’Administration (ENA) for

public administration and the Ecole

Polytechnique for future armament engineers.

An unusual feature of the Ecole Polytechnique

is that it was founded by Napoleon to train

engineers for the armed forces. It is run by the

Ministry of Defense and led by a three-star

general.

Military Rank Ingenieurs de l’armement Ingenieurs des Etudes et Officiers de corps technique

Techniques d’armement et administratif de l’armement

Lt. Gen. IG1A Ingenieur general de IG1ETA Ingenieur general de OG1CTAA Officer General de lere

1 ere classe de 1 ere classe des Etudes et class du corps technique et

l’armement Techniques d’armament adminstratif de l’armement

Major Gen. IG2A Ingenieur general de IG2ETA Ingenieur general de OG2CTAA Officier general de 2 eme

2 eme class de 2 eme classe des Etudes classe du corps technique et

l’armement Techniques d’armement administratif de l’armement

Colonel ICA Ingenieur en chef de IC1ETA Ingenieur en chef de 1 ere` OC1CTAA Officier en chef de 1 ere

l’armement 2 eme classe des Etudes et classe du corp technique et

Techniques d’armement administratif de l’armement

Lt. Colonel ICA Ingenieur en chef de IC2ETA Ingenieur en chef de OC2CTAA Officier en chef de 2 eme

l’armement (en desous 2 eme classe des Etudes et classe du corp technique et

du 4eme echelong) Technique d’armement administratif de l’armement

Major IPA Ingenieur principal IPETA Ingenieur principal des OPCTAA Officier principal de corps

de l’armement Etudes et Techniques classe du copr technique et

d’armement administratif de l’armement

Captain IA Ingenieur de I1ETA Ingenieur de 1 ere classe O1CTAA Officier de 1 ere classe du

l’armement des Etudes et Techniques classe du corp technique et

l’armement administratif de l’armement

Figure 1-8. Military Officers in the DGA
The Falcon and the Mirage: Managing for Combat Effectiveness

1-16

The number of students at the Ecole Polytechnique is kept very low with only a total enrollment of 1000 and a graduation class of 250 per

year. These students are the future leaders of the

ministry of defense, industry and other government organizations. Future armaments engineers

will spend three years — two years in class and

one year of military training. They will receive

a master’s in science degree.

Graduates from one of the Grand Ecoles have a

choice of selecting one of the “elite Grand

Corps,” such as the Corps des Mines, the Corps

des Ponts et Chaussees or the Armament Corps.

The top graduates get first choice of their

preferred Corps. The schools are free, but there

is an obligatory three years of state service.

Each year 30 to 40 graduates are admitted to

the armament engineers Corps and the DGA.

From the Ecole Polytechnique they will continue

their education with two additional years. It is

typical that they will attend either ENSTA (Ecole

Nationale Supérieure des Techniques Avancées)

in Paris or at Sup’Aero (Ecole Nationale

Supérieure de l’Aéronautique et de l’Espace) in

Toulouse. They will receive specialized training in engineering fields such as aeronautics,

mechanics or advanced techniques. Some may

take additional training in foreign laboratories

or prepare a doctoral thesis. This provides six

to seven years of advanced training and prepares

the personnel for the highest levels of technological, scientific and management positions in

the DGA.

After school the IA will continue his training

on-the-job (OJT). The typical path for an IA

engineer would start out with a position in a

laboratory or test center. They will remain in

this position typically for a period of two to four

years. Again, the primary focus of their OJT

training is to gain technical knowledge. They

rotate in several different types of jobs to ensure

they have both broad based technical knowledge

of armaments development — although lately

there is an increased emphasis on developing

business management skills. This allows them

to operate effectively in the complex arena of

acquisition. They also specialize in fields such

as naval, armor, or aeronautics (“air”).

Other Educational Opportunities

The DGA has several other schools — the

ENSIETA (Ecole Nationale Supérieure des

Ingénieurs des Etudes et Techniques d’Armement), the ENSICA (Ecole Nationale Supérieure d’Ingénieurs de Constructions Aéronautiques) and CHEAr (Centre des Hautes

Etudes de l’Armement. The first two schools

provide higher training for IETA and civil servants specializing in technical areas. CHEAr, on

the other hand, provides training for executives,

managers and program teams. Of special interest is the Advanced Program Management

Course (44 days) which trains armament engineers to become future program managers. This

course is designed to provide “know how” on

managing integrated program teams and an

understanding of tools available and the issues

facing both the Ministry of Defense and DGA.

CHEAr offers other short courses — working

in an integrated management team; purchasing

and cost analysis; negotiating with industry;

human management; functional and value

analysis; international negotiation; and others.

An interesting cultural perspective on training

can be found in the literature on French management practices. The French perceive training in two ways. If selected and considered prestigious it is worthwhile doing. But to actually

go out and select various types of training on

one’s own initiative would not be considered

appropriate. “French managers are conscious

that the real training does not happen inside the

classroom. Formal training is largely irrelevant,

reserved primarily for the lower echelons. The

high flyers know that their development will be
Chapter 1 The French National Milieu

1-17

organized by rotating them through various

activities and will be guided by a mentor who

will help them make contacts and oversee their

leap from specialist to general management.”31

COLLABORATION AND

ARMAMENT SALES

Two key elements of the French defense policy

are (1) the need for arms cooperation, particularly within a European cooperative framework, and (2) the need for armament sales to

maintain the viability of their defense industry

and to maintain lower prices for their own equipment. According to the May 2001 issue of Janes

Magazine,32 France is now the second ranked

exporter of military equipment with the United

States being first. From 1991 to 199 they exported FF 334 billion ($46.3B), while the United

States sold $83 billion and Russia sold about

$35 billion. They primarily export to three Persian Gulf nations — United Arab Emirates

(UAE), Saudi Arabia, and Pakistan.

The primary focus of French acquisition policy

makers currently is on arms cooperation within

the European framework. This involves bilateral

agreements, although the real effort has been in

the multilateral area. This includes NATO, the

Western European Armaments Group (WEAG);

and of particular importance is the increased

commitment by France, and other European

nations, to the Organisme conjoint de coopération en matiere d’armement) (OCCAR). OCCAR

was created in 1996 by four nations — France,

Germany, the United Kingdom, and Italy. It is

designed to be free of the normal strictures of

each country, and to manage collaborative

programs between member nations.

During its first five years, several program were

moved into OCCAR, including the Roland

Missile and the Tigre Helicopter Program. But

since it did not have legal status it could not issue

contracts. Its real birth took place this year when

it became a legal entity and was given responsibility for a major new development program —

the A400M military transport aircraft. As a legal

entity, it now has the power to directly contract

with industry. The A400M, a $20 billion program, offers the opportunity to OCCAR to show

its abilities to handle the complexity of a large

program in an international environment. Both

France and Germany have indicated their desire

to move many of their collaborative programs

into OCCAR.

In the area of armament sales, as previously indicated, France is one of the major world players. In the DGA two organizations — Directorate for International Relations (DRI) and the

Directorate of Cooperation and Industrial Affairs (DCI) — have primary responsibility for

cooperation and for facilitating and promoting

armament sales.

DRI has responsibility for countries outside of

Europe. Its primary responsibility is to promote

and control French armament equipment exports

to foreign markets. It coordinates the development and implementation of export strategy. It

assigns defense attaches overseas to promote

military and armament relations with other countries. They also subsidize missions for small

business to participate in events such as trade

shows. They also have responsibility for export

control activities and oversight of cooperation

activities with allied nations.

DCI works European issues, such as cooperation within the EU and OCCAR. It also provides

armament attaches to European countries and

the United States to promote armament

cooperation and sales. “While it is currently

focusing on cooperation opportunities with its

European Union (EU) neighbors, it has made a

significant effort to build upon a solid bilateral

relationship with the United States through multiple means, including more than 100 Data
The Falcon and the Mirage: Managing for Combat Effectiveness

1-18

Exchange Agreements (DEAs) — more than

with any other European nation, and through

multiple international cooperation agreements,

including cooperative R&D.”33 Finally, an important point to remember on armament sales is

that while both DRI and DCI promote and assist

sales, sales are managed by the defense industry.

SUMMARY

This chapter highlighted several features of the

French acquisition system. The first key feature

is the political roles of the executive and legislative branches, which are characterized by a

strong executive role in the management of

defense programs. They have a centralized

acquisition agency, the DGA, which develops

and buys new weapon systems for the military

services with a central corps of armament engineers providing the leadership for the organization. The selective nature of the national educational system is a central tenet for selecting

future acquisition leaders.

There are several key positions — representing

the DGA and the military services — involved

in managing programs. They are the Architect

of Systems Forces and the Program Manager

(from the DGA) and the Operational Concept

Officer (OCO), the General Staff Correspondent

Officer (OCEM) and the Program Officer (from

the Services). To assist the senior acquisition

leaders, in this case Armament Engineers, an

array of military and civilian personnel provide the necessary technical and operational

expertise.

The long-range planning and programming process provides a framework for the five-year parliamentary passed programming laws, which

among other things, provides a catalogue, schedule and target expenditure for the modernization of French armed forces. And then, the budgeting process tries to fund, albeit unsuccessfully, the modernization needs. The DGA operates in a typical hierarchical structure, although

adopting modern management techniques, such

as IPTs and matrixing, with a goal to improve

responsiveness to its customers. And finally, the

procurement approach is characterized primarily by sole source contracts, although to counter

the increased cost subcontracting competition

and component breakout are two techniques that

have been used. The next chapter will provide a

look at the U.S. environment for acquisition.
Chapter 1 The French National Milieu

1-19

ENDNOTES

12. Title V includes items for the Gendarmerie

and other activities not considered in modernization accounts.

13. The military programming law was enacted

on July 2, 1996. It constitutes the first legislative expression of the objectives set for

the armed forces by the President. For the

1997-2002 period it provides the means for

planning efforts to be made for modernizing France’s defense resources.

14. “Loi de programmation” of 1996 set the resources for modernization to be a steady

FF86 billion through 2002. They missed the

targets in 97, 98, 00 but did meet it in 1999.

15. This includes the gendarmarie, which is a

part of the defense ministry.

16. From Le Figaro (online) 17 Juillet 2001 a

17h10.

17. From Defense White Paper (“Ministère de

la Defense, Livre Blanc Sur la Défense,”

1994).

18. Christina Mackenzie in Defense News,

November 2000, pg. 12.

19. There are 8 ASFs. Their areas of responsibility are: Deterrence (Dissuasion), C3I,

Mobility (strategic and tactical), Deep

Strike (Penetration), Readiness (Préparation et maintien de la capacité opérationnelle), Land, Air and Sea.

20. OCO in French is Officier de concept

operationnel, while OCEM is Officier

correspondant de l’Etat major.

21. The list of programs is contained in Instruction Ministerial # 7576.

1. The Force de Frappe.

2. Bloch, George A., “French Military Reform: Lessons for America’s Army?” in

Parameters, U.S. Army War College Quarterly, Vol. XXX, No. 2, Summer 2000, US

Army War College, Carlisle, PA, pg. 36.

3. Bloch, pg. 36.

4. Currently serves a term of five years, although originally it was seven. This was

changed by a referendum in 2000.

5. Fifth Republic Constitution, Article 15.

6. Occasionally, these are in dispute.

7. A distinction between the two houses is that

finance bills must be submitted to the National Assembly first (article 39).

8. The U. S. has the largest followed by Japan,

Russia, France and then Britain. Some

would argue that the Peoples Republic of

China has a larger budget, but the official

budget is only $17 billion for 2001.

9. Fiscal year is from January 1 to December

31.

10. In most cases I have used French Francs

versus dollars because of the continually

changing exchange rates. Generally you can

use a 7 francs / 1 dollar exchange rate for

an approximation in U. S. dollars. The Euro

is included because shortly after this book

is issued the French franc will have been

replaced by the Euro.

11. Source is the French Embassy, Profile of

France.
The Falcon and the Mirage: Managing for Combat Effectiveness

1-20

22. Kausal, Tony, Gertrud Humily, Trevor

Taylor, Peter Roller, A Comparison of the

Defense Acquisition Systems of France,

Germany, United Kingdom and the United

States, DSMC Press, 1999.

23. The Instruction Ministerial # 1514 provides

the official guidance for the Ministry.

24. Some examples from the 39 fields.

25. The overall defense budget was set at 185

billion francs, at constant 1995 levels. Total financial resources are divided between

operating costs (99 billion francs) and capital investment (86 billion).

26. The terms procurement, contracting and

occasionally acquisition can often be used

somewhat confusingly even for acquisition

professionals. In the sense used for this section procurement or contracting refers to

the awarding and management of contracts.

27. ICA Jean Pierre Devaux, Budget Finances

du Service Des Programmes Aeronautiques, (SPae/GP), various dates.

28. As of December 2000. Source is the

Ministere De La Défense Rapport d’activité

2000 for the Délégation Général pour

l’Armament. DCN stands for the Directorate for Naval Construction while SMA

stands for Service de la maintenance

industrielle aéronautique.

29. As of 1/1/2000,Directorate for Naval Construction reports directly to MOD.

30. Barsoux, Jean-Louis and Peter Lawrence,

French Management: Elitism in Action,

Cassell Publishing, Wellington House, 125

Strand, London, 1997, pg. 40.

31. Barsoux, pg. 78.

32. May 16 2001.

33. Boulesteix, Cara, “The Defense Industry in

France,” an U.S. and Foreign Commercial

Service and U.S. Department of State document, 4/7/2001, pg. 3.
Chapter 2 The United States National Milieu

2-1

Chapter 2

THE UNITED STATES

NATIONAL MILIEU

political parties and the growth of

congressional committees and

special interest groups.”2 As this

relates to the military, the President (chief executive) is Commander-in-Chief of the Armed

Forces. Although the constitution

delegates the power of Commander-in-Chief to the President, the power to

declare war rests solely with the Congress. Further, even though the president is in “charge” of

the military, the power to determine the size of

the armed forces, the rules that govern the military, and the funding for the military forces and

their equipment are vested only in the Congress.

The purpose of this chapter is to provide a quick

look at the general structure of the U.S. government, and how the Department of Defense, the

Air Force and their armament programs fit into

this framework. This will provide a conceptual

backdrop for understanding the environment

within which the F-16 program office must

operate. With this as a setting, Chapter Five will

look at how a program is managed.

Congressional Involvement in Acquisition

The Unites States has a bicameral legislature,

or two-house system: the Senate with two representatives from each state (100 members) and

six-year terms; and the House of Representatives with proportional representation (435

members) and two-year terms. Congress alone

has the authority to declare war...to raise and

support armies...and maintain a navy...and to

The Political-Military Environment

Former Senator Sam Nunn from Georgia was

once asked “How is it that every year C-130

Hercules cargo planes appears in the annual

defense budget?” Senator Nunn’s response indicated that he was not sure, but perhaps his

friends must put them in. “...Over the last two

decades members of the Congress have ordered

the purchase of two hundred fifty-one C-130s,

the Air Force requested only five.”1

 It must be

puzzling to someone not familiar with the U.S.

political system that something like this can

happen. Yet it was borne as part of the original

design process of the “founding fathers.” To

understand the military acquisition system one

must start with the American political system.

The nation’s founders struggled in 1789 with

the creation of a system of government that was

effective but did not centralize power with any

one person or group. To ensure this did not happen they devised a scheme that provided for a

“separation of powers” between the executive,

legislative, and judicial branches of government.

This “balance of power” gives each branch of

the government specific authority and checks

upon that authority from the other branches.

“The American political system has a number

of unusual institutional features that maximizes

the probability that any given proposal for a

change in policy will be rejected or deferred.

These include: the distribution of power among

the executive, legislative, and judicial branches

of government, the electoral system and staggered terms of office, the decline of disciplined
The Falcon and the Mirage: Managing for Combat Effectiveness

2-2

make rules for the government and regulation

of the land and naval forces.3

 The work of Congress is accomplished in Committees. The Senate Armed Services Committee (SASC) and the

Senate Appropriations Committee (SAC) authorize defense efforts and appropriate money. The

House has parallel committees — the House

Armed Services Committee (HASC) and the

House Appropriations Committee (HAC) that,

like the SAC, provides new spending authority

for defense programs.

In most other countries the Government’s budget is discussed and debated but rarely changed.

In the U.S. system it is always changed. As an

example, in the Fiscal Year 1998 budget, the

Office of Management and Budget (OMB) identified a list of 254 programs or projects not

requested by the executive branch that were

added to the defense budget. The opposite is just

as normal, where programs are zeroed out of

the budget. This balance-of-power mechanism

is a key differentiator of the American political

model.4

Historically, Congress has always enjoyed a significant voice in acquisition. At the beginning

of the 19th century when the nation was still

young, Congress issued the first governmentwide procurement statute mandating executivelegislative appointment of what we today call

“contracting officers.” Congress continued to

play a significant role in acquisition throughout

the last century, including the methods of procurement — formal advertising, creating advisory boards, and dictating the size and speed of

ships. Throughout World War I and II Congress

passed legislation to prevent unscrupulous

contractors from overcharging the government.

The modern era of congressional involvement

in acquisition began with the Armed Services

Procurement Act of 1947. This law standardized contracting methods used by all of the services. As a result, the first joint DoD regulation

was created — the Armed Services Procurement

Regulation (ASPR).5

 In the last twenty years the

amount of legislation involving the defense business has increased. During the Reagan administration, along with the significant increases in

the defense budget came more Congressional

oversight. Almost every two years, major legislation was passed to change some aspect of the

acquisition system — organizational structure,

policies, ethics requirements, and the education

and training of the acquisition workforce. For

the F-16 program over the last several years,

congressional involvement has included increased purchases for new aircraft, with the latest

buy four aircraft in the FY 2000 budget.

Congress and The Budget

“The power of the purse has always resided in

Congress; it represents its ultimate weapon in

dealing with the executive branch.”6

 In February every year, the administration submits the

President’s budget to Congress. The budget goes

to the House and Senate budget committees,

which issue a Budget Resolution that provides

the top line budget for DoD. “Every committee

wants a hand in budget making. Hence, Congress has a two-step financial procedure: authorization and appropriations. Congress first passes

authorization laws that establish federal agencies and programs and recommend funding them

at certain levels. Then it enacts appropriations

laws that allow agencies to spend money. An

authorization then is like an “IOU” (I owe you)

that needs to be validated by an appropriation.”7

This process, from the President’s budget submittal through approval by Congress and the

final signature by the President takes approximately eight months. Debates, hearings, and

the committee processes — aggravated by the controversial nature of the issues — often delay the

passage of bills in Congress. To ensure the smooth

operation of government under these conditions,

Congress may pass interim legislation, referred
Chapter 2 The United States National Milieu

2-3

to as “continuing resolutions,” that allows government agencies to continue all existing programs, at prior-year amounts. Such interim legislation does not usually allow for the initiation

of any new programs. The implementation of

an interim budget has become the standard

method of operations since 1979.

Congressional Oversight

The SASC and HASC conduct their “oversight

responsibilities...primarily within the context of

the Committee’s consideration of the annual

defense authorization bill.”8

 Every spring, key

administration personnel (such as the Secretary

of Defense and the Secretaries of the Army,

Navy and Air Force) along with the senior military leaders are called to testify before the appropriate subcommittees on the President’s budget. The subcommittees will also have hearings

with other key defense acquisition personnel on

the budget, acquisition policy and programs.

When Congress has a specific interest or concern, investigative committees will be created.

They will have hearings on specific problems

or issues which arise, or when Congress is

interested in a department’s implementation of

prior legislation. Again, government acquisition

personnel, along with industry or industry-association representatives, may be called to

testify.

The Cabinet

To provide advice to the President and to “run”

the governmental agencies, the President appoints Cabinet members. They serve as the advisors to the President on policy matters. Members of the Cabinet, unlike those in other countries, are responsible to the President rather than

the legislature. They serve at the pleasure of the

President and can be removed from their jobs

by the President for any reason. Traditionally,

Cabinet members are from the same party as

the President and share the same political beliefs.

The Cabinet member responsible for defense is

the Secretary of Defense.

To assist the politically appointed Secretary of

Defense, the President also appoints hundreds

of other “political appointees” to serve in key

positions such as Secretary of the Air Force, and

key acquisition positions such as the Under Secretary of Defense (Acquisition, Technology and

Logistics) and Assistant Secretary of the Air

Force (Acquisition). In the DoD there are approximately 240 political appointees, of which

48 require Senate confirmation.9

DEPARTMENT OF DEFENSE

The Department of Defense (DoD) is divided

into two elements — the warfighting elements

and the acquisition and logistics support elements. Figure 2-1 depicts an overall view of the

department with the warfighting elements being

the Unified Commanders for each theater. The

three major organizations involved in acquisition

within the DoD are the Army, Navy, and Air

Force. Other defense agencies play a support

role to acquisition, such as the Defense Contracting Management Agency (DCMA) that provides contract administration for the department,

and the Defense Contract Audit Agency (DCAA)

that provides audit support for the services and

defense agencies.

The Office of the Secretary of Defense (OSD)10

is the core staff that provides advice and support to the Secretary. OSD consists of approximately 2,000 personnel that, through the Secretary, sets “general policies and programs” and

provides “general direction, authority, and control” of the military departments and defense

agencies. The Under Secretary of Defense for

Acquisition, Technology and Logistics (USD

(AT&L)) is charged with responsibility for

acquisition matters.
The Falcon and the Mirage: Managing for Combat Effectiveness

2-4

The 2001 fiscal year budget for the Department

of Defense (DoD) is over $293.2 billion, of

which $98.2 billion is for the research, development and production of weapon systems. It

is 3.0 of the Gross Domestic Product (GDP) and

16.2 percent of the overall government budget.

The Air Force portion of the defense budget was

$85.6 billion in FY 2001—an increase of $3.5

billion from the prior year. The modernization

portion was $34.6—a rise of $1.4 from FY2000.

In the last several years there has been political

pressure to increase the defense budget to meet

modernization and operating needs of the Services.

Defense Acquisition Structure

In 1986 a Presidential Blue Ribbon Commission on Defense recommended a change in the

management of acquisition programs. They

called for the Department to “establish unambiguous authority for overall acquisition policy,

clear accountability for acquisition execution,

and plain lines of command for those with

program management responsibilities.” Included

in those plain lines of command were to be

“short lines of command.” Both Congress and

the President accepted these recommendations

and created the current structure. This was a

major reporting change for the military services.

In essence removing the responsibility for defense acquisition programs from the “military”

side to the “civilian side” of the organization.

These issues are still of concern and have been

repeatedly raised over the last 10 years.

Out of the above efforts, the popularly coined

“acquisition czar” position was created. Officially titled, the Under Secretary of Defense

(Acquisition, Technology and Logistics),11

Figure 2-1. Department of Defense

Office of the

Secretary of

Defense (OSD)

Chairman,

Joint Chiefs

of Staff

Department

of the

Navy

Department

of the

Air Force

Department

of the

Army

Defense

Agencies

Joint

Staff

Secretary of

Defense

UNIFIED COMMANDS

Regional Command Functional Commands

U.S. European Command U.S. Space Command

U.S. Pacific Command U.S. Special Operations Command

U.S. Atlantic Command U.S. Transportation Command

U.S. Southern Command U.S. Strategic Command

U.S. Central Command

Unified

Commands
Chapter 2 The United States National Milieu

2-5

(USD/AT&L) or the Defense Acquisition Executive (DAE), the “acquisition czar” was given

overall responsibility for the policy and management of the acquisition system. Similar

positions were created within the Services. To

create “short lines of command,” the Program

Executive Officer (PEO) structure was created

with four levels of management. The lines of

command between the Service Acquisition

Executive (SAE) and the program manager are

limited to two (see Figure 2-2).

The Air Force Acquisition Organization

The Air Force is a separate department within

DoD with the requirement, by law, to train,

Figure 2-2. Acquisition Program Reporting

Figure 2-3. Office of the Assistant Secretary of the Air Force (Acquisition)

Defense Acquisition

Executive

(USD(A&T)

Component (Service)

Acquisition Executive

Program Executive Officer

(General Officer/SES Civilian)

Program Manager

(Col/LtCol/Civilian Equivalent)

MDA

CAE

PM

PEO

DAE

Airlift, Trainers

& Modeling

and Simulation

Fighters &

Bombers

MGen Mushala

JSF* Weapons Launch

Systems

C2 & Space

Combat Support

Dir, Information

Dominance

Dir, Global

Power

Dir, Global

Reach

Dir, Space and

Nuclear Deterrence

Dir, Special

Programming

DAS, Science,

Technology &

 Engineering

DAS,

Contracting

DAS, Mgmt

Policy &

Prgm Integration

• Scientific Adv Brd

• RFP Support Office

• AF Chair - DSMC

Assistant Secretary

(Acquisition)

Prin Deputy

(Acq & Mgt)

Prin Deputy

for SC

Prin Deputy

Mission Area Directors

Program Executive Officers

*Navy PEO reports

to AF Acq Exec
The Falcon and the Mirage: Managing for Combat Effectiveness

2-6

organize, and equip its members. The acquisition executive is the Assistant Secretary of the

Air Force (Acquisition) — (ASAF (A)) (see Figure 2-3 for organization structure). He has three

principal deputies. The Principal Deputy (Acquisition and Management) oversees the management of Air Force acquisition programs,

acquisition reform, and acquisition training and

education. This individual currently holds the

position of chairman of the NATO Airborne

Early Warning and Control Program Management Board of Directors. The Principal Deputy

(Acquisition) provides management direction of

programs and interface with the user12 and the

Hill. Recently a Principal Deputy for Business

and Information Management was created to increase the management emphasis on software

and computer problems.

To help in the management of programs the Air

Force has seven Program Executive Officers

(PEOs), responsible for a number of missionrelated programs, which collectively comprise

a PEO’s portfolio. Six of the current seven PEOs

have portfolios grouped into areas, such as fighters and bombers, weapons, airlift, trainers and

modeling and simulation, space, launch systems,

and command, control and combat systems. A

seventh PEO (and Program Manager) manages

the Joint Strike Fighter (JSF). The PEOs are a

field unit, not part of the headquarters staff, and

have small staffs, consisting of seven personnel

for each office. A typical PEO will have oversight of five or six programs, each managed by

a Program Manager, who is held responsible for

ensuring that cost, schedule and performance

aspects of acquisition programs are executed

within an approved program baseline. The PEO

for the F-16 is Major General Michael Mushala

(Fighters and Bombers).

Air Force Materiel Command

The main field level organization involved in acquisition is the Air Force Materiel Command

(AFMC). Headquartered at Wright-Patterson

AFB, Ohio, it employs approximately 100,000

personnel. Its mission is to manage the Air Force

research, development, test, and acquisition

efforts and to provide logistics support for Air

Force weapons systems. Specifically, they perform scientific research and depot maintenance,

provide technical support for existing weapon

systems (such as the F-16); and certifies and

manages system safety, integrity and suitability

for combat use. It also provides the manpower

and process support to the PEO structure.

The division of responsibility for acquisition

program work rests with either a Product or

Logistics Center. Weapon systems with significant development or production efforts remaining are usually managed by one of four Product

Centers. These centers are primarily responsible

for development, acquisition, testing, and fielding of new or modified weapon systems. The

four centers are:

• Aeronautical Systems Center, WrightPatterson AFB, Ohio

• Space and Missile Systems Center, Los

Angeles Air Force Base, California

• Electronic Systems Center, Hanscom Air

Force Base, Massachusetts

• Air Armament Center, Eglin Air Force

Base, Florida

Existing weapon systems and military equipment are managed by one of three air logistics

centers. These centers have responsibility for

logistics support and maintenance of weapon

systems and equipment. They are:

• Ogden Air Logistic Center, Utah

• Oklahoma City Air Logistics Center,

Oklahoma
Chapter 2 The United States National Milieu

2-7

• Warner-Robbins Air Logistics Center,

Georgia

In support of weapons development, AFMC has

two test Centers — Arnold Engineering Development Center, Tennessee, and Air Force Flight

Test Center at Edwards AFB, California. AFMC

is also home of the Air Force Research Laboratory (AFRL). The AFRL, at Wright-Patterson

AFB, is the science and technology organization for the Air Force. They perform internal

research and leverage the capability of other

national scientific organizations, industry, and

academia. The Air Force Security Assistance

Center (AFSAC), likewise at Wright-Patterson

AFB, is also part of AFMC, and manages foreign military sales programs totaling in excess

of $20 billion in support of more than 80 foreign

countries.

THE ACQUISITION SYSTEM

To discuss the acquisition management system

it is necessary to mention two other decision

support systems used to manage the department.

They are the Requirements Generation Process

and the Planning, Programming, and Budgeting

System (PPBS). All three systems are designed

to assist senior decision-makers such as the Secretary of Defense, USD (AT&L), Secretary of

the Air Force and other senior officials in making critical decisions. The output from these

systems provides the money, authority, people

and other resources necessary to execute programs and deliver a product to the warfighters.

Figure 2-4 provides a conceptual look at the

systems and the overlap between the systems.

While these systems interact continuously, they

also operate separately. Decisions and issues

overlap from one system to the other; and each

impacts on the ability of the acquisition system

to deliver timely, cost-effective systems.

The Development of 

Military Requirements

The process to determine future military needs

is referred to as the Requirements Generation

Process. All acquisition programs must be based

on identifiable, documented, and validated

mission needs. The Joint Chiefs of Staff (JCS)

is the organization responsible in DoD for setting

requirements policy. For large dollar programs,

referred to as Major Defense Acquisition Programs (MDAP), or Acquisition Category (ACAT)

I programs, the JCS is the approval authority

for the requirement. For smaller dollar programs,

Figure 2-4. Three Decision Making Support Systems

Planning, Programming,

Budget System

Requirements

Generation

Acquisition

Management
The Falcon and the Mirage: Managing for Combat Effectiveness

2-8

referred to as ACAT II and III programs, the

individual services develop and approve their

own requirements in coordination with the other

services and defense agencies.

The Air Force Requirements Processes

In the Air Force, the requirements process is

decentralized with the major operational command for a program such as the F-16 being the

Air Combat Command (ACC) located at Langley Air Force Base, Virginia. The ACC Director of Requirements (ACC/DR) as part of its

modernization reviews, identifies deficiencies,

evolving threats or technological opportunities,

and then generates new military requirements.

DR then writes the requirements documents

called the Mission Needs Statement (MNS) and

the Operation Requirements Document (ORD).

They prioritize programs and then advocate

within the Air Force budgeting process for

money to fulfill their needs. In the Headquarters Air Force, the Deputy Chief of Staff for Air

and Space Operations (AF/XO), and specifically

the Directorate of Operational Requirements

(AF/XOR), reviews and coordinates MNS and

ORDS. They guide those programs requiring

approval and validation through the JCS process. The Chief of Staff is the approval authority for all MNS and ORDs for ACAT II and III

programs.

Planning, Programming, and

Budgeting System

The Planning, Programming, and Budgeting

System (PPBS), designed to link strategic planning activities to the budget, is unique to the

DoD. The PPBS is a cyclic process, looking out

five years, with annual reviews of the resources

necessary for the department to operate. In each

phase, OSD issues guidance; the Air Force and

other organizations request resources; and the

Defense Secretary issues a decision.

The planning portion of the PPBS begins about

two years in advance of the fiscal year in which

the budget will be requested. The Air Force, with

OSD, conducts a six-month process beginning

in the fall and ending in March. The overall

framework for planning is provided by the President in his National Security Strategy and the

National Military Strategy. This phase begins

when the JCS issues the Joint Planning Document (JPD) that proposes long-term strategy and

force levels necessary to achieve national military objectives. Based on the JPD, OSD issues

the Defense Planning Guidance (DPG) document that provides the strategic mid-range-planning framework for developing the Air Force

Program Objective Memorandum (POM).

The programming phase is next. The Air Force

responds with their POM stating requirements

for resources (such as personnel and supplies)

and justifying acquisition programs. Then, an

assessment of the capabilities and risks associated with the proposed forces and programs is

made. A period of formal discussions (program

review cycle) follows between the Air Force,

OSD, and the JCS. Once an acceptable level of

resources and programs is agreed to, the Secretary of Defense issues a Program Decision

Memorandum (PDM).

The final phase is the budgeting phase. The PDM

has set the resource and acquisition program

levels. These are translated into the Air Force

annual budget, which is in turn reviewed by

OSD. Based upon OSD comments, the Air Force

submits a Budget Estimate Submission (BES)

in September. After resolution of issues caused

by the BES submittal, OSD issues program budget decisions and the DoD budget is finalized.

What survives is voluminously documented and

submitted to OMB for inclusion in the President’s Budget, which is submitted to Capitol

Hill in February.
Chapter 2 The United States National Milieu

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The Acquisition Management System

The Acquisition Management System consists

of the policies and procedures governing the

operations of the entire DoD acquisition system.

There are three documents that guide the defense acquisition business. The first is DoD Directive 5000.1, The Defense Acquisition System, which identifies the key officials and panels for managing the system and provides broad

policy and principles for all acquisition programs. DoD Instruction 5000.2, Operation of the

Defense Acquisition System, provides detailed

procedures to implement the broad policies of

DODD 5000.1. And finally, the third document

is DoD Regulation 5000.2-R, which provides

guidance for the management and oversight and

review of major defense acquisition programs,

and major automated information systems

The acquisition system is designed around a

series of life-cycle phases. It begins by conceptualizing a system and extends to actually developing and fielding a system, and eventually

phasing it out of the inventory. More colorfully

it is described as a “womb to tomb” system. The

life cycle model shown in Figure 2-5 is divided

into three main activities. They are: (1) the PreSystems Acquisition activity which includes the

Concept Exploration and Component Advanced

Development Phases, (2) Systems Acquisition,

which includes the Systems Integration, System

Demonstration, Low Rate Initial Production and

Full Rate Production and Deployment phases,

and (3) Sustainment which includes the Sustainment and Disposal phases. Figure 2-5 also

depicts the milestone decision points, which a

program must pass to continue to the next phase.

A program can enter the process at any milestone

— A, B, or C (or within phases).

The milestones are decision points. At each milestone, the decision maker, the Milestone Decision Authority (MDA) (see Figure 2-6), will

make a determination whether or not the system is programmatically and technologically

ready for the next phase. As an example, an Air

Force Avionics system begins the System Integration work effort with two goals — demonstrating certain technology and developing a

successful prototype. The MDA evaluates how

successful the program performed its goals and

what its projected cost, schedule and technical

risks are for the next phase. If the goals have

Technology Opportunities

& User Needs

Pre-Systems

Acquisition

Systems Acquisition

(Demonstration, Engineering Development,

LRIP & Production)

Sustainment

Concept

Exploration

Component

Advanced

Development Decision

Review

Concept &

Tech Development

System

Integration

System

Demonstration

LRIP Full-Rate Prod

& Deployment

Sustainment Disposal

System Development

& Demonstration Production & Deployment Operations & Support

Interim

 Progress

 Review

FRP

Decision

 Review

IOC FOC

Single Step or

Evolution to Full

A A B B C Capability

Figure 2-5. Defense Acquisition Management Framework
The Falcon and the Mirage: Managing for Combat Effectiveness

2-10

been met and the performance parameters are

acceptable, the MDA approves the program to

begin the next phase — System Demonstration.

Of course, if the program has not met its goals

and the risks are perceived to be too great, the

program could be cancelled or additional technical efforts may be undertaken. For Major

Defense Acquisition Programs, the Defense

Acquisition Board (DAB) (to be discussed later)

is the MDA. This is an event-driven process and

some programs will go through a phase in one

or two years, whereas another may take four or

five years.

Defense Acquisition Board (DAB)

This body has been called the “corporate-level

vice-presidents of DoD weapons acquisition.”

As the senior review board, it is chaired by the

USD (AT&L) for ACAT I programs. At each

milestone, the DAB authorizes program initiation or continuation. Each DAB review assesses

the program accomplishments during its current

phase and determines whether or not it is ready

for the next acquisition phase. When the DAB

approves continuation, it provides exit criteria,

which must be met to continue to the next

phase.13 In the case of the F-16, which is now an

ACAT II program, the OSD has delegated all

authority to the Air Force level.

Integrated Product Teams (IPT)

The IPT concept was introduced to Air Force

program offices in the early 1990s. The acquisition community found the concept worked well

and expanded it as part of the Department’s

Acquisition Reform efforts. With the change in

administrations in 2001 and the corporate style

approach to managing the DAB process the role

of the IPTs will probably change over the next

couple of months. For that reason only the

Overarching IPT14 will be discussed here. The

Program Office IPT is discussed in Chapter 5.

The Overarching IPT is the highest organizational level IPT and is used in managing ACAT

level I programs. An OSD official assigns each

program to an OIPT lead. There are four OIPTs,

and the officials leading them (see Figure 2-7).

Typical OIPT membership is the Program Manger, PEO, Service Staff, Joint Staff, USD

(AT&L) staff and other senior OSD staff members involved in oversight and review of a particular program. OIPTs meet as necessary over

the life of a program. The goal is to resolve as

Figure 2-6.

Categories of Acquisition Programs and Milestone Decision Authorities (MDA)

Category Management Responsibility/MDA

ACAT ID* USD (AT&L)

ACAT IC Generally the Service Acquisition Executive

ACAT IAM Assistant Secretary of Defense (C3I)

ACAT IAC SAE

ACAT II SAE

ACAT III Delegated to PEO/PM/acquisition command

*Acquisition Category (ACAT)

D=Defense, C=Component (Service), M=Major Automated Information System
Chapter 2 The United States National Milieu

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many issues and concerns at the lowest level possible, and to expeditiously escalate issues that

need to be resolved at a higher level, bringing only

the highest-level issues to the MDA for decision.

THE PROCUREMENT/

CONTRACTING SYSTEM15

The Department of Defense is the largest buyer

in the world. It spent, on contract, approximately

$109 billion in Fiscal Year 1998, $116 billion in

FY 1999, and $122B billion in FY2000. The Air

Force in the same time frame spent $35.3 billion,

$36.5 billion and $38.9 billion, respectively. The

items bought range from developing major

weapon systems, such as the F-22, to buying

repair services for copiers. It is a large, complex

system with hundreds of buying offices located

throughout the world. The basic policy of the

U.S. Government is that products and services

will be bought, if possible, competitively.

The regulation governing procurement for the

DoD is Federal Acquisition Regulation (FAR).

The Director, Defense Procurement, who is the

USD (AT&L) staff, sets policy for procurement

within the department. In turn, the Deputy Secretary for Contracting (SAF/AQC) is functionally responsible at the service headquarters level

for Air Force contracting policy. The actual

awarding of contracts in the Air Force is decentralized. The main contracting organizations

within the Air Force are located with the Air

Force Materiel Command. Weapon Systems

Contracting is done at centralized agencies, such

as the Air Force’s Aeronautical Systems Center,

at Wright Patterson Air Force Base.

There are two general types of contracts used in

DoD contracting—Fixed Price and Cost Reimbursement. Fixed price type contracts, as the

name implies, set the price to be paid to the contractor on the day the contract is awarded. This

type of contract is used where the item is well

defined, for example, a jeep or an existing missile. For newly developed equipment, where

there are many technical and manufacturing

risks, a cost-type contract is used to share the

risk between the government and the contractor. In a cost-type contract, the government reimburses all allowable and reasonable costs, plus

a small fee. For a more thorough discussion of

contract types, see FAR, Part 16.

Contractors are competitively selected for a

major acquisition contract through a highly

structured process of “Source Selection.” This

is done to ensure fairness and transparency in

the selection of a source. A typical source

selection starts with the “Contracting Officer”16

issuing a Commerce Business Daily (CBD) announcement for a pre-proposal conference.17 All

interested bidders are invited. Attendees will be

briefed on the military requirement and an approximate schedule of events. The next event is

issuance of a “draft” Request for Proposal (RFP)

looking for industry comments for changes and

problems. Finally, all interested contractors are

provided an RFP. Interested contractors submit

Figure 2-7. OIPTs and OSD Officials

OIPT OSD Official

Strategic& Tactical Director of Strategic and Tactical Systems

Space Assistant Deputy Under Secretary of Defense

(Space and Acquisition Management)

C3I/AIS Deputy Assistant Secretary of Defense (C3I)
The Falcon and the Mirage: Managing for Combat Effectiveness

2-12

a proposal. A source selection team evaluates

proposals. Their assessment will be briefed to

the Source Selection Authority (SSA), a senior

government official, who will make the actual

selection. For large dollar and highly controversial weapon system acquisitions, the Source

Selection Authority could be the Secretary of

the Air Force or the SAE. Most often it is a Program Executive Officer or another senior official. Once the contract is awarded the program

office will assign contract administration activities, such as payment and quality assurance, to

the Defense Contract Management Command,

which has offices located in various regions

throughout the United States. Management of

the contract, as it relates to key program requirements, will be maintained in the program office.

The Defense Contract Audit Agency (DCAA)

plays a significant role in supporting program

offices with contract audits and accounting and

financial advice during the negotiation, administration, and settlement of contracts and

subcontracts.

The U.S. defense acquisition system is highly

regulated with laws and policies covering every

area of procurement, such as the contractor’s

financial systems, records keeping, socio-economic requirements, subcontracting, and ethics.

But, it is also a transparent system designed to

ensure fair treatment of vendors with equitable

opportunities to bid on new defense work.

DEFENSE ACQUISITION AND

TECHNOLOGY WORKFORCE

About 149,000 personnel, military and civilian,

work in the Defense Acquisition and Technology workforce.18 In the Air Force currently

20,600 military and civilians position in the

acquisition and technology workforce as shown

in Figure 2-8,19 a dropped 2900 from the previous year. There is a subgroup within the Acquisition and Technology Workforce referred to as

the Acquisition Corps,” i.e., those that fill a Critical Acquisition Position (CAP) (3,337 positions). A CAP, for GS-14 and Lieutenant Colonel positions, requires appointment by only those

personnel who have met all the defense acquisition experience, training and education

requirements.20

The Acquisition Corps is only about a decade

old. In 1990 Congress passed the Defense Acquisition Workforce Improvement Act (DAWIA).

DAWIA’s purpose was to create a workforce

fully proficient and knowledgeable in the business of acquisition. Education, training, and

experience requirements were established for

each acquisition position based on the level of

complexity of duties required for that position.

The Defense Acquisition University (DAU) was

established to provide for the formal education

and training of the workforce. DAU as of

Figure 2-8. Acquisition and Acquisition Corps Positions

FY 2001 FY 2000 CAP Positions

Civilian 13,280 Civilian 14,009 Military 1,237

Officer 5,885 Officer 7,872 Civilian 2,100

Enlisted 1,495 Enlisted 1,709

TOTAL 20,660 TOTAL 23,590 TOTAL 3,337
Chapter 2 The United States National Milieu

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September 2001 reorganized its campuses and

regions. Five regional campuses now include:

• DAU Northeast Campus at Fort Belvoir,

VA (also the DAU Headquarters location)

• DAU Midwest at Wright-Patterson AFB,

OH

• DAU South at Huntsville, AL

• DAU Tidewater at Patuxent River, MD

• DAU West at San Diego, CA

Additional offices of instruction fall under these

campuses at several previous DSMC locations.

Essentially for FY 2001 and much of 2002,

courses will continue at their usual previous

locations as the University transitions to the new

structure.21 During the rest of the transition

period (FY 2002 and 2003) course locations will

probably change. DAU offers over 80 courses

with 1200 offerings covering all acquisition

career fields. In FY 2000, DAU graduated more

than 40,000 students, with current projections

showing this number increasing in the out years.

A Typical Career Path

Every acquisition career or functional field

defines the education, experience and training

requirements for its members. Examples of

career fields are Financial Management, Logistics, Manufacturing, Quality Assurance, Contracting, Program Management, Engineering,

and Test & Evaluation. When individuals are

hired into the workforce, they enter at Level I,

the first of three levels of progression. Generally, individuals possess an appropriate degree,

and once hired, receive a combination of onthe-job and formal training.

For program management the formal training is

ACQ22 101, the Fundamentals of Systems Acquisition (see Figure 9) for career training). After

several years on the job, an individual will continue to receive on-the-job-training plus attend

the ACQ 201, Intermediate Systems Acquisition

Course and PMT23 250, Program Management

Tools Course, to achieve their level II certification. With continued successful performance on

the job, and by taking the PMT 352, the Program

Management Course at the Defense Systems

Management College (DSMC), an individual

Figure 2-9. Program Management Career Track

ACQ-101

Fundamentals

of Systems

Acquisition

Management

PMT-352

Program

Management

Office

Course

PMT-401

Program

Manager’s

Course

PMT-402

Executive

Program

Manager’s

Course

• Knowledge based

• 11 functional areas

• Internet

• GS 5-9/01-03

• Application/

knowledge based

(cost/sch/perf)

• Internet/classroom

• GS 9 - 12/03-04

• Tool based

• Modules

• Business areas

• Internet

• GS 12 - 13/03-04

• 03-04

• Case/scenario based

Critical thinking/

problem solving

• Application of

knowledge (cost/sch/

performance)

• Internet/classroom

• GS 13 - 14/04-05

• Critical thinking/

problem solving (cost/

sch/perf)

• Business acumen

• Case based

• Classroom

• Potential ACAT I, II, & III

Pms, Dpty PMs & other

senior acq mgrs

PEOs & ACAT I & II

PMs & Deputy PMs

4 weeks, classroom

Level I

certification

Level I I

certification

Level III

certification

Meets statutory requirement for

PEO/ACAT I/II PM (10 USC 1735)

80 hours, on line 50 hours, on line Length 10 weeks

6 weeks classroom

35 hours, on line

1 week classroom

25 hours, on line

ACQ-201

Intermediate

Systems

Acquisition

Course

PMT-250

Program

Management

Tools

Course
The Falcon and the Mirage: Managing for Combat Effectiveness

2-14

can achieve Level III certification and be eligible for a critical acquisition job. A critical

acquisition job is a senior position — GM/S1424 for civilians and lieutenant colonel and

above for military. The final step in the program

management career field would be competitive

selection to attend the ACQ 401, the Program

Managers’ Course, and then selection to manage a major system program and attendance at

the PMT 402, the Executive Program Managers’ Course. These three levels meet the training and experience requirements to become a

major systems program manager. Similar types

of education and training requirements exist for

all acquisition career fields.

Of the three military services, the Air Force has

traditionally had the most military working in

acquisition. One of the contributing factors for

the difference is the Navy and Army’s tradition

of military personnel spending the first several

tours in an operational environment. Later in

their careers, Army and Navy personnel move

from an operational job, such as an artillery

officer or pilot, into the acquisition workforce.

This approach is similar to the Air Force’s tradition of moving its rated personnel, pilots and

navigators, into the acquisition workforce, at

about the 8-10 year point in their career. However, the Air Force also has a significant number of career acquisition military personnel who

begin and finish their careers in acquisition.

Military officers fill most program management

positions, although one of the features of

DAWIA was to increase the number of program

management positions available for civilians.

To ensure personnel continue to maintain or

grow their skills and knowledge, the Department

has mandated 80 hours of professional continuing training every two years. This program is

designed to keep the workforce current with acquisition reform changes as well as functional

and technical advances, and generally to improve

the business knowledge and leadership competencies of the workforce.

COOPERATION AND

ARMAMENT SALES

International Armament Cooperation has been

a key component of the Department of Defense’s

strategy for several decades. The F-16 multinational production program is a prime example

of an aircraft developed and produced as part of

a cooperative effort. It is also an example of a

successful armament sales program, with fourteen additional nations currently flying the F-16s.

Nowadays, the pressures of tight defense budgets and increasing operational activities with

coalition forces make international armaments

cooperation an even more attractive proposition.

By sharing development and production costs,

each national partner can buy more military

power at less cost. Standardizing equipment,

particularly with our NATO allies, can also lead

to shared logistics lines, making the fighting

forces more capable, again at less cost.

The DoD has two approaches to working with

our friends and allies either as Cooperative Program for research, development and production

or as part of a Foreign Military Sales (FMS)

program. Under the general rubric of Security

Assistance, the FMS program provides military

and economic assistance to our allies. FMS

includes the sales of military equipment, education and training of foreign military, and loans

or grants for the purchase of U.S. equipment.

Arms sales in the United States are conducted

in two ways: government-to-government (referred to as FMS) or foreign government to a

U.S. contractor (referred to a Direct Commercial Sale). Through FMS, allies and friendly

nations spent an estimated $18.6 billion dollars

in Fiscal Year 2000.25
Chapter 2 The United States National Milieu

2-15

Both the executive and legislative branches play

significant roles in Cooperative Acquisition and

Security Assistance. Congress provides the legal

basis for executive branch actions in the Foreign Assistance Act, Foreign Military Sales Act,

Arms Export Control Act, and Export Administration Act (which has expired and has not been

renewed). Besides providing the legal basis for

arms sales and transfers, Congress is involved

in several other ways. As part of its routine procedures, the department is required to notify

Congress whenever it sells significant military

equipment with a value over $14 million to a

foreign government, or when an international

agreement for a cooperative acquisition project

is signed, or in certain cases, proposed for signature. In some cases, Congress may pass specific legislation denying an arms sale. One of

the most famous examples of this type of congressional involvement was the passing of the

“Pressler Amendment”26 which restricted the

sale of F-16s to Pakistan. This, however, is extraordinarily unusual. Usually, the mere threat

of legislative restriction will cause the executive department to restructure an arms sale, as

was the case with the F-16 aircraft sale to Saudi

Arabia.

In the executive branch, the three primary

departments most heavily involved in security

assistance and cooperative programs are the

Departments of Defense, Commerce and State.

The Department of State (DoS) has the overall

responsibility for the continuous supervision and

general direction of the security assistance program. The Secretary of State determines whether

or not there will be a security assistance program sale to another country. The State Department makes its decisions based upon the foreign policy and national security implications

of a transaction. They must answer specific questions. Does this transaction protect and promote

U.S. interests throughout the world? What are

the political, economic, human, environmental

and security impacts of this transaction? They

also maintain the International Traffic in Arms

Regulations (ITARs), which provides the rules

for the registration of, and import and export

licensing of all direct commercial imports and

exports of armament into and out of the United

States.

The Department of Commerce has responsibility for setting policy and licensing for export of

equipment that has primarily a commercial use

but can have a military use, often referred to as

dual use items. A multitude of other organizations is involved in Security Assistance — the

National Security Council, Defense Threat

Reduction Agency, Security Assistance Offices

and Offices of Defense Cooperation in all major

foreign capitals and other organizations.27

Within DoD, the Under Secretary of Defense

for Policy (USD (P)) is the principal national

security and security assistance adviser to the

Secretary. Reporting to the USD (Policy) is the

lead agency within DoD for security assistance

— the Defense Security Cooperation Agency.

Cooperative acquisition programs have a different reporting chain of command with responsibility resting with the Director, International

Cooperation, within the office of the USD

(AT&L). Within the Air Force, the lead office

for policy and oversight of security assistance

and cooperative acquisition programs is the

Deputy Under Secretary of the Air Force for

International Affairs (SAF/IA). Air Force

Materiel Command, Director of International

Affairs and its subordinate command, the Air

Force Security Assistance Command (AFSAC),

manages the security assistance program. Cooperative acquisition program management responsibility rests with the Assistant Secretary

of the Air Force (Acquisition). Management of

cooperative programs is part of the normal

acquisition management system.
The Falcon and the Mirage: Managing for Combat Effectiveness

2-16

SUMMARY

This chapter has explored the political roles

played by the executive and legislative branches

and underscores the pervasive role that Congress

plays in the management of defense programs.

They establish in the law the DoD organizational

structures, the policies and, of course, approve

the programs and money. The system has several

other significant features. The acquisition organization is large, authority and responsibility are

distributed to many levels and it is geographically dispersed throughout the country. The key players and organizations involved in acquisition are

many — OSD, SAEs, PEOs, PMs, SAF/AQ,

AFMC, ACC and others. To guide this large organization and its needs, OSD has created several

decision-making structures — Requirements,

PPBS, and the Acquisition System — all designed to operate simultaneously, but separately,

yet with the need to coordinate, to provide military equipment lacked by the warfighting forces.

Within this large organization, management arrangements, such as the PEO structure and the

use of IPTs, have attempted to provide expeditious, less burdensome decision-making methods. Finally, the defense business is a $100 billion a year business relying heavily on the competitive buys of equipment to ensure reasonable

prices. Closely tied to DoD buys is the sale of

armaments by U.S. defense businesses, which

accounts for about half the world sales. The next

chapter will look at the industrial relationships

between government and industry.
Chapter 2 The United States National Milieu

2-17

ENDNOTES

11. Originally the title was Under Secretary of

Defense (Acquisition). I have used the current title to avoid confusion. By law these

political appointees are required to bring a

significant industrial background to qualify

for the position.

12. The user is a term used to denote the

warfighting or other organizations that

“use” the equipment the acquisition organizations buy. In the case of the F-16 there

are several organizations, but the primary

one is the Air Combat Command located a

Langley Air Force Base, Virginia.

13. Note that the DAB review only approves a

program to proceed; it has no direct role in

the resource allocation process.

14. The other two are the (1) the Working IPT

and (2) the Integrating IPT. Both are

designed at the staff levels of the headquarters to improve the decision making

process.

15. The terms procurement, contracting and

acquisition can often be used somewhat

confusingly even for acquisition professionals. In the U.S., “acquisition” is meant to

be the all-encompassing term, while procurement and contracting are meant to be a

subset of acquisition dealing with the

awarding and management of contracts. To

make it even more confusing, Congress

often passes legislation using all three terms

interchangeably or often with specific

meanings.

16. The only person authorized by law to award

or modify contracts.

1. Kwame Holman on the News hour with Jim

Lehrer (transcript) September 29, 1998.

MsNeil.

2. Perino, Jr., George H. (Tony), “Defense

Procurement, American Style, The Cultural

Ingredients of Weapon System Acquisition

Policy,” unpublished paper, 1992, pg. 9.

3. U.S. Constitution, Clauses 11, 12, and 13.

4. For a more in-depth look at the American

System prior book entitled “A Comparison

of the Defense Acquisition Systems of

France, Germany, United Kingdom and the

United States,” or the website version at

http://www.dsmc.dau..mil .

5. Now called the Federal Acquisition Regulation (FAR).

6. Trask, Roger R., and Alfred Goldberg, The

Department of Defense 1947-1997, Organization and Leaders,” Historical Office,

Office of the Secretary of Defense, Washington, D.C. 1997, pg. 15.

7. Davidson, Roger H. and Oleszek, Walter

J., “Congress and Its Members,” Third

Edition (Washington: CQ Press, 1990),

pg. 327.

8. Oversight Plan for the 105th Congress,

pg. 1.

9. Source is the OSD Legislative Affairs

administration and personnel office.

10. For clarification purposes, generally, when

“DoD” is used it means the entire department. OSD refers to the Secretary’s office.
The Falcon and the Mirage: Managing for Combat Effectiveness

2-18

17. The CBD is scheduled to be replaced by

“Fedbizops” on 1 January 2002. The

website is www.fedbizops.gov.

18. In the Department of Defense when one

talks about the acquisition workforce this

has a specific legal meaning. There are

various measures of the acquisition workforce: 1) DoD Instruction 5000.58, acquisition organizations, 355,299 people; 2)

Pub.L. no. 101-50, Defense Acquisition

Workforce Improvement Act, 105,544

people; and 3) Jefferson Solutions Report,

revised Packard Commission, 177,613

people. Current number reflects March

1998 data.

19. Office of the Associate Defense Acquisition Career Manager, as of 15 Feb 01.

20. There are waiver procedures available.

21. To view the DAU course catalog, visit

www.dau.mil.

22. ACQ is an acronym for “acquisition.”

23. PMT indicates Program Management

Training.

24. GM/S – General Manager or General Scale

and refers to the Program Scale/Rank for

Civil Servants.

25. According to a study “Conventional Arms

Transfers to Developing Nations, 1993-

2000,” as quoted in the New York Times,

August 20, 2001. In recent years the U.S.

has had over 50 percent of the world’s arms

sales.

26. Named for Senator Larry Pressler, Republican South Dakota.

27. The Defense System Management College,

Fort Belvoir, Virginia conducts training for

management of Cooperative Acquisition

programs.
Chapter 3 Industry-Government Relationships

3-1

Chapter 3

INDUSTRY-GOVERNMENT

RELATIONSHIPS

Whether it is across the Atlantic or across borders, industry and government relationships are

changing. As companies have moved ahead to

deal with changing international relationships,

governments have struggled to adjust their policies and deal with the politics of this changing

world.

The two countries in this study — France and

the United States — have been on the forefront

of these efforts. But they come from different

perspectives. The first look at these two countries reveals a rather striking difference in the

size of their defense industries. As shown in

Figure 3-1, the United States has by far the

Introduction

The defense industry theme of the last five years

has been globalization. On both sides of the

Atlantic and even in the Pacific, defense companies have moved to merge and form partnerships with foreign firms. In the United States,

the British firm BAE is now the fourth largest

defense company.1

 The year 1999 saw the creation of a transnational company — EADS.

Three companies from France, Germany and

Spain formed the European Aeronautic, Defense

and Space (EADS) Company. In June of this

year, Raytheon and Thales (formerly Thomson

CSF) announced a cross-Atlantic joint venture.

Figure 3-1. Selected Top Defense Firms – 1999

Revenue 1999

Rank Company Country (Billion)

1 Lockheed Martin Corp. US $ 17.8

2 Boeing US 16.3

3 BAE Systems UK 15.2

4 Raytheon Corp. US 14.5

5 General Dynamics US 9.0

6 EADS Netherlands 6.0

7 Northrop-Gruman US 6.0

8 Thomson SCF (Thales) France 3.6

19 DCN France 1.6

33 Dassault Aviation France .9

37 Giat Industries France .8

42 SNECMA Group France .7

44 SAGEM S. A. France .7
The Falcon and the Mirage: Managing for Combat Effectiveness

3-2

biggest defense industry. This is to be expected

considering the significant difference in the defense budgets of both countries. However,

France has recently become the second largest

seller of defense equipment, and thus both a

major competitor and a major cooperative partner on many research and development efforts.

A second striking difference between the two

countries is the concept of the relationship between government and industry. In France, it has

been the tradition for the State to play a significant role in the lives of its people. The American tradition has been exactly the opposite. This

chapter will provide a look at defense industries

and the relationship between the government and

industry.

THE UNITED STATES DEFENSE

INDUSTRIAL BASE2

To discuss the current U.S. defense industrial

base, one needs to start with the “Last Supper”

in 1993. Then Under Secretary of Defense and

later Secretary of Defense William J. Perry invited the CEOs of the top U.S. defense firms to

dinner. Asking each of them to look to their left

or right, he prophesied that by the next time they

had dinner 50 percent of them would be gone.

The end of the Cold War now signaled the end

of large defense modernization budgets. There

was just not enough defense business to go

around and over-capacity was now the problem.

It is a fundamental American belief that this is

the private sector’s responsibility. It was thus up

to industry to sort out the problem, hopefully in

the most efficient way. Out of this famous “Last

Supper” came a wave of mergers and acquisitions as many old-time defense firms were eliminated. Hughes Aircraft (producer of a line of

missiles such as the Maverick) and Rockwell

International (designer, developer and producer

of the B-1) are now part of the history books.

“Merger mania” result in forty some aerospace

firms being consolidated into three global giants

— Lockheed Martin, Boeing and Raytheon3

(Northrop-Grumman not far behind).

Background

The original American concept of the proper role

for government was to define that role narrowly.

That state’s role was to provide for a military, a

postal service, roads, and other activities, but

industry was part of the private sphere of society. Even the regulation of industry was an issue; the Supreme Court finally decided this when

it stated that the national government did have

the right to regulate the interstate transportation

of goods through the commerce clause of the

constitution. This practice in the United States

has been to separate the two spheres — public

and private — and in the defense arena, to rely

upon private industry for its needs. Notwithstanding this separation — ownership of a defense industry or not—“all of them (governments) — as regulators, licensers, subsidizers,

standard-setters, rate-setters, taxers, buyers and

sellers — undoubtedly exert a great variety of

powerful economic influences”4

 on industry.

Historically, the United States has maintained a

small peacetime arsenal system, publicly owned,

but relying on the public sector industries to fill

much of their needs. During World War II, military demands quickly overcame this small

capability. The United States commercial industry responded to the government’s call producing the millions of pieces of military equipment

needed to pursue the war. With the surrender of

Japan signed aboard the USS Missouri in Tokyo

Bay in 1945, the military demobilized and the

industrial base — the “Arsenal of Democracy”

— demilitarized and returned to the lucrative

pre-war commercial market — producing cars

and household appliances. But as Winston

Churchill so adequately commented, an Iron

Current had descended on Eastern Europe and

the Soviet Republic and we “entered the era of

the “Cold War.” For the next fifty years, the West
Chapter 3 Industry-Government Relationships

3-3

and the Soviet Empire engaged in an arms race.

The United States, its allies, and the Union of

Soviet Socialist Republics (USSR) continued to

produce large amounts of military weapons,

each generation more capable than the preceding. To support this race, defense industry

became “big business.”

As defense industry grew, the Department of

Defense developed its own set of specialized

procurement rules and regulations, a system of

technical specifications and standards, Cost

Accounting Standards (CAS), ethics requirements, and oversight procedures. Congress,

responding to cost overruns and to various special interest groups, passed legislation imposing many new requirements on the Department

of Defense and its contractors, such as set-asides

of work for small businesses and domestic

producers. Rather than imperil their commercial divisions with increasing costs, industry

spun-off separate defense divisions. Having a

separate manufacturing and technology base

increased the cost of buying military equipment.

An early 1990s study indicated that the defense

industry legitimately charged a 20–25 percent

premium because of these arcane rules and regulations mandated by the government.5

Traditionally, the United States has relied on a

privately-owned, profit-oriented industrial base

to provide most of the goods and services used

by the military departments. This defense manufacturing and technology base industry can be

characterized as providing high performance,

high quality military equipment at high cost but

with a low volume of production. Defense is

currently over a $100 billion a year business.

This includes over $80 billion a year for research

and development and procurement of systems

and equipment. Four firms — Lockheed Martin,

Boeing, Northrup-Grumman and Raytheon—

are the dominant businesses in defense. Three

of the four firms, with Boeing being the exception, rely on defense contracts for over 80

percent of their business revenue. Historically,

over the last forty years most of the U.S. defense

firms have very little non-defense business.

Over the last 50 years, the Department of

Defense has “primed the pump” of R&D with

its investment in many new technologies. The

U.S. Government supported and directed programs that produced the basic technologies that

spawned numerous military and commercial

innovations. These innovations, both military

and commercial applications, include mainframe

computers, personal computers, stealth technology, avionics for commercial aircraft, and many

other technologies. As an example, in the

microelectronics industry, DoD was once the

dominant buyer, with almost 70 percent of the

microelectronics industry sales in 1965, and it

contributed significantly to that industry’s investment in R&D. Today, defense accounts for

less than 1 percent of microelectronic sales. In

general, the defense investment over the last

twenty years in R&D has been overshadowed

by private sector investment in R&D. In 1997,

defense R&D spending provided 30 percent of

the U.S. investment in R&D. This was down

from the peak years of the defense buildup in

the mid-1980s when it was 46 percent of the

national investment.

While DoD policy has been to rely on private

sector facilities for the fulfillment of government

contracts, remnants of the government’s earlier

“arsenal system” still remain. These public

facilities are used to manufacture and repair aircraft, ships, ground combat systems, and other

military equipment. They generally fit into two

categories. The first category is government

arsenals and depots where government personnel

perform all the work. Examples of these in the

Air Force include depots such as WarnerRobbins Air Logistics Center, Warner-Robbins

Air Force Base, Georgia and the Ogden Air

Logistics Center, Ogden, Utah. The other category is referred to as Government-Owned-
The Falcon and the Mirage: Managing for Combat Effectiveness

3-4

Contractor-Operated (GOCO) facilities. While

it has been a slow process, the military departments have attempted to divest itself of GOCO

plants.

Recent Trends

In recent years, several trends have emerged as

a result of declining defense budgets. Businesses

have left the defense market, companies have

merged, and the Department has recognized that

its defense budget could not support its modernization program as well as a separate defense

industrial base. While no hard data exists, significant numbers of companies at the 3rd or 4th

tier vendor level have apparently left the defense

business over the last decade. Large companies,

such as Intel, Motorola and Hewlett-Packard

have refused to do business with DoD unless it

buys on commercial terms, without the imposition of expensive and burdensome federal laws

and regulations. Many companies lost interest

in the defense market, thus companies such as

GE, Westinghouse, and IBM got out of the

defense business, selling off their defense units.

Defense industry went from five or six manufacturers for a military product to one or two.

This was a simple matter of economics —

smaller budgets, the concomitant drop in work

orders, and the “stretching out” of programs

made the defense business less attractive to

commercial vendors.

But in the “unforeseen consequences” category,

the merger mania of the 1990s left U.S. policy

makers concerned with the number of companies remaining to provide a competitive base for

buying its new equipment. “Merger mania” may

be over for at least the major contractors. The

first sign of the change in policy was the Justice

Department (with OSD concurrence) blocking

the Northrop Grumman and Lockheed merger

in 1998, because it had the potential to create a

monopoly. One of the foundations of U.S.

government procurement is competition. As

companies drop out of the defense business or

merge, competition disappears and costs rise.

This is particularly worrisome with the large

system integration companies like Lockheed

Martin and Boeing. As the defense business base

continues to decline, smaller companies will

probably continue to merge. At the large prime

level, the market has probably seen the end of

U.S. company mergers, although mergers or

partnerships between international companies

are still probable. Teaming arrangements, partnerships, joint ventures, and other similar ventures will probably continue, particularly in the

international arena.

While DoD has attempted through its “acquisition reform” and “revolution in business affairs”

initiatives to change the way DoD does business, it has not resulted in the “hoped for” merger

of the defense and commercial industrial bases.

Even with Congress passing several laws, at

DoD’s urging, to remove some of the barriers,

the evolution to a merged defense industrial base

has not happened. There are some exceptions,

such as the Atlas II, which uses the same production line for both commercial and domestic

launch vehicles. These laws made modest

changes with major issues still left to be resolved, such as eliminating specialized accounting and auditing systems. But defense firms are

still primarily defense firms. With the upturn in

defense spending for modernization and most

of the same rules and regulations still in place,

they will most likely remain separate from the

commercial industrial base.

THE FRENCH DEFENSE

INDUSTRIAL BASE

France has the largest defense industry in Western Europe, employing more than 175,0006

people, and represent 4.5 percent of the total

French industrial employment. It generates

roughly 15 billion euros in sales annually.7

 It
Chapter 3 Industry-Government Relationships

3-5

also occupies an important position in the French

economy with more than 5,000 companies (including government owned facilities) involved

in defense. Approximately 6 billion Euros goes

into the export markets in 2000.8 It offers its

defense customers a wide range of products —

ships, aircraft, and tanks are just some of the

examples. In terms of skills, it has developed

the expertise to design develop and produce its

own systems. It provides nearly (90 percent) all

its own defense equipment. And most of the large

companies involved in defense have a significant commercial market presence to help offset

periods of slow defense spending.

Background

The real force behind the creation of a robust

defense industry for France was President

Charles De Gaulle. For the most part, the United

States provided defense equipment to France

after the end of World War II and in the early

years of the Cold War. With De Gaulle’s return

to power in 1958 and his decision to create a

military force that was both independent and had

nuclear capabilities (la Force de Frappe), it was

also necessary for France to produce its own

equipment. It was essential to develop and maintain a strong, self-reliant defense technology and

manufacturing industry able to produce a full

range of products.

Thus, in addition to the creation of the DGA in

1961 to manage defense programs, France promoted its “national champions” within the defense sector of the French economy. Its national

champions included Dassault for fighter aircraft,

Aerospatiale for helicopters and ballistic missiles, GIAT for tanks and artillery, Matra for airto-air missiles, and SNECMA for engines.

This approach follows a long tradition and

practice for the French government to be extensively involved in the economy and with business. Unlike the United States, there is no precise

distinction between the public and private sectors in France. An Office of Technology Assessment report on the French defense industry written in the mid 1990s stated that, “Nearly fourfifths of the French defense industry is owned

directly or indirectly by the state, either in the

form of government-owned and -operated arsenals, nationalized companies (e.g., Aerospatiale,

GIAT Industries, and SNEMA), or firms in

which the government owns a large share of the

stock (e.g., Dassault Aviation, Matra and

Thomson Brandt Armaments).”9

Politics and political philosophy have played a

role in the government’s “see-saw” policy toward the defense industry during the last forty

years. De Gaulle and his successor, George

Pompidou, saw the need for a “guiding hand”

— government pressure on industry to merge

where appropriate, along with the creation of

state ownership of various companies, such as

Aerospatiale in 1970. The election of the socialist Mitterand in 1981 saw a wave of nationalization of industry — banks, steel and defense

(such as the seizure of Matra). With the socialist losing the 1986 election, although retaining

the Presidency, the conservative government of

Prime Minister Jacques Chirac came to power.

A period known in France of “cohabitation”

came into being, with the President from one

party, the Prime Minister from another. As politicians are wont to do, the socialist Mitterand,

who had been responsible for the nationalization of industry, issued his famous “ni-ni” remarks — neither further nationalization nor

privatization. In other words, maintain the status quo. Notwithstanding those remarks, the

French governments began a period of the

privatization of industry. Even the current

socialist government of Prime Minister Jospin

has continued, and in fact, put in force the

privatization efforts initiated “by the right.”

The French government has exercised its control through the bureaucracy and, in the case of
The Falcon and the Mirage: Managing for Combat Effectiveness

3-6

defense industry, the DGA’s Cooperation and

Industrial Affairs Directorate (DCI) has facilitated the development and nurturing of the

defense industry. In practice how has the DGA

approached its role in managing or guiding defense industry? First, it is a customer for defense

equipment. Second, it has been responsible for

looking ahead at the defense industrial needs and

then to sustain, create, and nurture as appropriate. Third, it is an operator of industrial facilities such as SMA and formerly DCN. Next it

has oversight of the State’s majority shares in

defense firms such as SNECMA (97 percent),

GIAT (100 percent), and SNPE (100 percent).

Fifth, with the European Union laws and regulations are binding on its members, and it has

been the enforcer and monitor of compliance. It

is also involved in reviewing investments, mergers, and exports of defense goods, although the

primary responsibility for export control has

moved from DGA to the central ministry. When

potential cooperative projects between countries

or between industries are involved, DCI is the

point of contact with its new Director, Laurent

Giovachini, serving as the National Armament

Director (NAD).

Restructuring and the Europeanization/

Globalization of the French Industry

Thirty years ago, there were still many doubters on the ability of Europe to throw off centuries of divisiveness to create a European Union.

While it has been a step-by-step process, it has

moved forward and dealt with the tough issues.

Institutions have been created — a parliament

and operating agencies — borders have come

down, and next January 2002, a common currency, the Euro, will be the script of France,

Germany, and many other European nations. A

common EU defense policy and force are not

far behind. While this area has traditionally been

sacrosanct from EU rules, changes have begun.

The Helsinki agreement in 1999 and the decision to create a European rapid reaction force

indicate the resolve of the various governments

to move in the direction of a common European

Union defense policy. The June 1999 EU summit in Cologne also recognized the key role

played by industry and called for a restructuring of defense industry. A framework agreement

was signed in July 2000 designed to aid European consolidation. It covered areas such as

security of supply, exports, security of information, research and technology, and intellectual

property rights.

As background, Europe entered the 1990s with

several defense industries — primarily France,

Britain, Germany, Sweden, Spain and Italy. The

European defense industry was highly fragmented and had significant over-capacity even

before the Cold War ended. A spur to the reorganization of Europe’s defense industry was the

creation of huge U.S. firms and fear of American dominance. The European nations, and in

particular France, felt it necessary to have a

European approach to counter the huge American industrial giants. Governments provided

encouragement to their contractors to diversify,

create strategic alliances, buy foreign firms, and

evaluate cross-border mergers.

French defense companies, with government

pressure, have made major efforts to adapt.

Thomson CSF (now Thales) in 1998 and Aerospatiale in 1999 were restructured and transferred from the public to the private sector. Previously a majority shareholder of these companies, the French State concluded shareholder

agreements with the private industrial groups

Alcatel and Lagardere, which acquired significant interests in the new and enlarged

Thomson CSF. Aerospatiale then merged with

Matra and then further merged into EADS10 (the

French government owns 15 percent of EADS).

Dassault Aviation, the producer of the Mirage

2000, was transferred from the government (at

least the State’s shares — 46 percent) to

Aerospatiale Matra (now EADS). Most change
Chapter 3 Industry-Government Relationships

3-7

has occurred in the aerospace portion of defense

industry with the land and naval industries not

taking any action, although the government has

continued its privatization efforts with its decision to transform DCN, a major builder of ships,

into a state-owned company.11

As a side note, one of the concerns of the United

States has been the perception of the creation of

a “fortress Europe.” While the answer to that

question is still out with the jury, the recently

announced formation of a transatlantic venture

between Thales and Raytheon ground-based air

operations command and control and battlefield

systems may indicate that that concern may be

misplaced.

The demand side of the equation is also being

addressed. As was mentioned in Chapter One,

the creation of the European procurement

agency OCCAR paves the way for improved

management of cooperative programs with the

hope that this would lead to more cooperative

programs. There have also been recent French

government efforts to increase the role that small

and medium enterprises (SME) play in the

defense business. The DGA wants to develop a

structure of dynamic, successful, and innovative SMEs that support and complement the

major prime contractors and equipment manufacturers. The goal is lowering cost while creating SMEs that bring technological innovation

yet competitively compete in the export market.

Consolidation and merger have not occurred

without problems. Cultural differences create

problems in management. And of course there

are still the political issues. “Old habits die hard.”

An example last year was the “fighter bid in

Greece...French government support for its

national champion, Dassault Aviation, has

caused friction with and within, the FrancoGerman-Spanish, European Aeronautic, Defense and Space (EADS) Co.”12 While it is still

too early to see the final outlines of the future

defense industry, the major thrusts seems to be

a European focus, with a recognition that it

cannot be only Europe, but that some form of

transatlantic effort is necessary.
The Falcon and the Mirage: Managing for Combat Effectiveness

3-8

ENDNOTES

1. Worldwide it is number three.

2. The U.S. defense industrial base is somewhat difficult to define, since it relies upon

private companies that continuously enter

and leave the business.

3. Weidenbaum, page 15-40. Companies in

whole or in part, were consolidated into

three — Lockheed Martin, Boeing and

Raytheon.

4. King, Anthony, “Ideas, Institutions and the

Policies of Governments: A Comparative

Analysis: Parts I and II,” The British Journal of Political Science, Cambridge University Press, 1973, pg. 296.

5. Coopers and Lybrand /TASC Project Team

Study of the Defense Industry from March

to October, 1994, at the request of thenDeputy Secretary of Defense Dr. William

J. Perry. The study was conducted under

the auspices of the Office of the Under

Secretary of Defense for Acquisition and

Technology (OUSD(A&T)).

6. This figure includes personnel from the

public sector — DCN, SMA and program

office personnel.

7. Boulesteix, Cara, “The Defense Industry in

France,” an U.S. and Foreign Commercial

Service and U.S. Department of State document, 4/7/2001, pg. 1. For comparison purpose, the Euro is trading in early September 2001 at roughly a 1 to 1 ration with the

U.S. dollar.

8. Aviation Week and Space Technology,

February 26, 2001.

9. From U.S. Congress, Office of Technology

Assessment, Lessons in Restructuring the

Defense Industry: The French Experience

— Background Paper, Report No. OTA-BPISC-96, pg. 8.

10. EADS is a consolidation in 2000 of

Daimler-Chrysler Aerospace AG, Munich,

Aerospatiale Matra, Paris and Construcciones Aeronautics S. A., Madrid.

11. Remembering that there is no specific distinction between public and private in

France, there are thus several levels of public/private ownership. Thus privatization in

France refers, as an example, to a process

of moving from an arsenal to a state-owned

company (nearly 100 percent ownership by

State) to an “enterprise publique” (>50 percent ownership), to transfer to private sector

(<50 percent ownership of capital).

12. From Defense News, October 23, 2000,

pg. 66.
Chapter 4 French Mirage 2000 Program

4-1

Chapter 4

 FRENCH MIRAGE 2000

PROGRAM

“Aircraft are like the soul,

 they have wings and they defy death.

 My aircraft will still be flying

 when I am no longer here.”

Marcel Dassault1

be no

funds left

to develop a

single-engine aircraft, we may lose

our foreign clients who

currently account for more

than 1500 Mirages and who keep

the whole French aeronautical industry going.”3

 He decided to set in motion a project with

the company’s own capital — without government financial assistance. His goal was twofold:

first, provide a backup should the ACF fail to

secure the government’s blessing; and second,

maintain and increase “market share for singleengine aircraft.”4

Finally in late 1975, then President Giscard

d’Estaing authorized a new, single-engine fighter

program to be ordered from Dassault. “It chose

...an aircraft that could fulfill French military

ambitions, and that also corresponded to budgetary provisions and was easier to export...

since exports play a vital role in maintaining the

capability of the French aeronautical industry.”5

This new delta-wing aircraft also needed a name.

After several attempts, the Air Force settled on

the designation “Mirage 2000” — the plane to

take the French Air Force into the 21st Century.

History

The fighter aircraft developer and manufacturer

for the Armee de l’Air, the French Air Force

(FAF), is the Dassault Aviation Corporation,

founded by Marcel Dassault at the end of the

Second World War. In the early 1970s Dassault

Aircraft Company, along with a small team from

the DGA and FAF, developed a “Super Mirage”

to meet Air Force requirements for an “Avion

de Combat Futur” (ACF).2

 The ACF was to be a

twin-engine fighter similar to but larger than the

U.S. Air Force F-15. The Armee de l’Air had

two missions to perform — deep attack and interception — so it needed an aircraft that could

reach speeds of mach 2.5 and with long range.

While several swing-wing prototype aircraft

(Mirage G and G8) had been successfully flown,

it was finally decided that a fixed-wing aircraft

was the best solution. Unfortunately, it cost more

than twice the prior version of the Mirage, the

F-1. The ACF was just too expensive for the

Ministry’s budget. In mid-1975 the Air Force

and the DGA appealed to the Defense Council,

chaired by the President.

At the same time, Dassault also had under development a less costly, lightweight fighter.

According to Marcel Dassault, “Since there will
The Falcon and the Mirage: Managing for Combat Effectiveness

4-2

With the government’s go-ahead, a prototype of

the Mirage was assembled in only 27 months. It

began its first flight test in March 10, 1978. The

small program office, about six or seven persons, was responsible for managing the Mirage

contract, as well as several other contracts. The

prevailing strategy during that period was to buy

separately the major subsystems such as engines,

an electro/optical system, and radars. These

would be provided, as Government-Furnished

Equipment (GFE), to the primary contractor —

Dassault — to integrate into the basic aircraft.

In 1979 the first production aircraft were authorized, although tight budgetary issues resulted

in the requested 20 aircraft being cut to only

four. Continual tight budgetary pressures and a

change in government did nothing to improve

the luck of the Air Force during the next three

years. Defense budget woes continued and a

much smaller number of aircraft was ordered in

the 1980-82 time frame (22, 22, and 25 versus

23, 43 and 44) than originally requested and

needed by the Air Force. The first production

unit rolled off the line 20 November 1982. “On

2 July 1984 — exactly 50 years to the day that

the French Air Force was officially established

as an independent armed service — the initial

Mirage 2000 squadron was formed.”6

 All told,

more than 300 have been ordered and delivered

to the Air Force.

While originally designed for the French Air

Force, DGA and Dassault have sold another 286

aircraft in various configurations to seven other

countries7

 — Egypt, Greece, India, Peru, Qatar,

the United Arab Emirates, and Taiwan.

Mirage — The Aircraft

The Mirage 2000 Program consists of four versions (see Figure 4-1) of its aircraft — Air

Defense (single and two-seater), air-to-ground,

penetration, and ground attack. Four versions

of the Mirage include the M 2000 C, both a

single- and two-seater, primarily for Air Defense, although it does have air-to-ground capability. In 1982 Dassault rolled off the assembly

line the next Mirage version, the Mirage 2000N,

Figure 4-1. Aircraft Models

Features:

• Fly-by-wire

• Mach 1.3

• SNECMA M-53 Engine

• RDM radar

• Matra Super 530 Msl

Features:

• Long range

• Low altitude

• Antelope 5 radar

• M-53 Engine

• ASMP Msl

Features:

• All weather

• Low altitude

• Antelope radar

• Laser guidance

system

Features:

• RDY multi-target

radar

• MICA Msl

• 5 screen visual

system

• New countermeasure

system

• Increase range

Features:

• GPS receiver

• Update RDY

• New air-to-ground

armaments

• More powerful antenna

2000

Mirage 2000-5

1990

Mirage 2000-5

1988

1982 Mirage 2000D

Mirage 2000N

1978/81

Mirage 2000C
Chapter 4 French Mirage 2000 Program

4-3

a two-seater. It is dedicated to launching the AirSol Moyenne Portée or ASMP (air-to-ground

nuclear missile) with a high-speed low-altitude

penetration using automatic terrain-following

radar. It also has a conventional, secondary, airto-ground mission — the same as 2000 D. The

French Air Force’s Mirage 2000 D, two-seater

is designed for penetration and air-to-ground attack, and carries a variety of advanced conventional weapons such as Guided Bombs and

stand-off weapons such as the Apache, SCALP,

Air-to-Air and Surface Missile (AASM). The

M2000D has an advanced navigation and attack

system that allows it to fly under any weather

conditions and at very low altitude. It is also

“nuclear weapon” capable. The M2000-5 is

multi-role aircraft single- and two-seater, and

has more advanced avionics including the ability to select multiple targets both air-to-ground

and air-to-air with an advanced visualization and

control system. For Air Defense, it is capable of

carrying the latest weapons and has several new

systems for radar and the Missile d’Interception

et de Combat Aerien (MICA).8

 It carries laserguided missiles rockets and bombs. The primary

contractor for all versions of the Mirage, including the Mirage 2000, and the latest generation

of aircraft for the French Air Force, the Rafale,

is Dassault Aviation. Assembly of aircraft takes

place at the Mérignac Aircraft plant near Bordeaux. For the Mirage 2000 Thales9

 provides

different types of radars (pulse doppler, radar

doppler multi-mode (RDM), radar doppler

impulse (RDI), Antilope, and terrain following

radar) and other avionics. The single turbofan

engine, M53-P2, is provided by SNECMA.10

The aircraft has a range of 1151 miles and can

attain speeds in excess of Mach 2.2 at high

altitude.

MANAGEMENT STRUCTURE

AND APPROACH

Headquarters DGA is located at the Cite de l’Air

in the 15th Arrondisement of Paris. It is organized in a traditional hierarchical model and has

three principal Directorates involved directly

Figure 4-2. DGA Organization

Directorate for

Human

Resources

DRH

Directorate for

Management

and

Organisation

Services for DGO

Aeronautical

Maintenance

SMA

Directorate for

Evaluation and

Test Centres

DCE

Directorate for

International

Relations

DRI

Directorate for

Cooperation

and

Industrial

Affairs

DCI

Directorate for

Forces Systems

and

Trend Analysis

DSP

Directorate for

Programs,

Procurement

Methods and

Quality

DPM

Directorate for

Weapon

Systems

DSA

Inspection

CHEAr

Assistant

Director

Armement

Programs

Délégué Général

pour l’Armement
The Falcon and the Mirage: Managing for Combat Effectiveness

4-4

with the management or support of armament

programs (see Figure 4-2). They are the Directorate of Weapons Systems (DSA)11 — the home

office for all programs managed within DGA),

the Directorate for Force Systems and Trend

Analysis (support to the PM and the home of

the ASFs) and the Directorate of Programs, Procurement Methods and Quality (support to the

PM).

Within the DSA, as shown in Figure 4-3, are six

main divisions. The six divisions cover the traditional military areas such a Land, Naval and

Aeronautics, as well as tactical missiles, command, communication and information (C2I),

and finally nuclear. The Aeronautical Programs

Division (DSA/SPAe) is home to the Mirage2000 program, as well as a variety of other aeronautical-related programs. A two-star armament

engineer, IGA Patrick Bellouard, leads SPAe.

Within the SPAe division (see Figure 4-4) there

are two general categories of support branches

— SPAe/GP and ST — and the Program Management branches. SPAe has assigned a total of

650 persons, with the program management

division having about 37 personnel directly

assigned.12 They are about one third military

(about 200 military) and two-thirds civilians.

Nine program management branches are responsible for aeronautical programs. An armament engineer, ICA Bruno Berthet, currently

leads the program office with which we are most

concerned — the Air Force Combat Aircraft

(AFCA)13 Division. Within that division is the

Mirage 2000. Other program offices include

programs teams for the newest French Dassaultbuilt fighter Rafale, air mobility (such as the new

A400M), the Tigre Helicopter, air and airport

operations, combat avionics, and naval systems.

Finally, they also have program management

responsibility for civil aviation equipment, much

like the Federal Aviation Authority in the United

States.

The two support divisions — SPAe/GP and

SPAe/ST — provide matrix manpower needed

by the program management divisions. The ST14

Figure 4-3. DSA Organization

Nuclear Programs

Division

DSA/SPNUC

C2I

Division

DSA/SPOTI

Director of Weapon Systems

(DGA/DSA)

IGA L. Collet-Billon

Land Programs

Division

DSA/SPART

Tactical Missile Programs

Division

DSA/SPMT

Naval Programs

Division

DSA/SPN

Aeronautical Programs

Division

DSA/SPNUC

Adjoint au Director Chef de Cabinet
Chapter 4 French Mirage 2000 Program

4-5

organization provides technical support to the

program offices in three basic functions — systems architects for aircraft integration; technical support personnel for various major functions such as fire control systems, navigation,

guidance, and electronic counter-measures; and

technical specialists for items such as radar,

engines, sensors, and logistics. They prepare

technical specifications for contracts both for

research and development (R&D) within SPAe

and for the program offices. They participate in

negotiations for the technical issues, much as

the PM would participate for management

issues, although the actual team leader of the

negotiation is the buyer. The Science and Technology Department/Division (ST) is responsibility for R&D studies and contracting for the

R&D. Additionally they have technical responsibility for the qualification and approval of the

aircraft.15 They have within the division to provide a user perspective about 10 to 20 military

officers and enlisted in addition to the integrated

work teams from the French Air Force staff. This

division is also be a potential starting point for

armament engineers to acquire, very early in

their careers, the technical training necessary to

prepare for more senior positions.

In GP16 (the other support organization), personnel provide assistance in functional areas

such as finance, buying, management and quality assurance. As the contracting authority for

SPAe, about 20 buyers assigned at various levels

of effort support the AFCF program office. The

Chief of GP has contracting authority up to

FF60M to sign contracts. They also have on the

staff about 20 specialists in law17 who help

ensure contracts written within their Division

comply with the laws. Management specialists

are available to help on organizational issues and

in the preparation of documents, such as the

launching files. And finally, they provide quality

assurance, configuration management, industrial, budget, and financial specialists to support

program needs.

Air Force Combat

Aircraft (AFCA) Division

The program office is located at DGA headquarters but support personnel are located at test centers and contractor’s plants throughout the country. In the last year they have restructured their

program management framework to reflect a

truly matrixed organization. Renamed the Air

Figure 4-4. Aeronautical Programs Division (DSA/SPAe)

Mobilite armee de l’air

Air Force Combat Aircraft

(Avions de combatarmee de l’air

ICA Bruno Berthet

Mobilite armee de l’air

Systemes aeroportes

Program Management

Division (SPAe/GP)

Systems and Technical

Division (SPAe/ST)

Air Operations Conduct Systems

Combat Avionic & Naval Systems

Tigre Helicopter

Mobilite Terre, marine et divers

Civial Aviation

Aeronautical Programs Division

DSA/SPAe

IGA Patrick Bellouard
The Falcon and the Mirage: Managing for Combat Effectiveness

4-6

Force Combat Aircraft Division (Avions de combat-armee de l ’air), it consists of the Program

Manager plus three project managers and a manager responsible for handling export issues. The

PM and the project managers are armament engineers, while the person responsible for exports

is an Ingénieurs des Etudes et Techniques

d’Armement (IETA). They have responsibility

for all versions of the Mirage 2000, plus older

versions of the Mirage F-1, Jaguar, Mirage-IV

and the Alphajet trainer. Part of the rationale for

the reorganization is the need to set up a “program-like” management structure for aging aircraft. Currently the total support by the matrixed

organizations — SPae/GP and SPae/ST —

ranges from 30 to 50 staff for Mirage 2000 support. In the past the program office consisted of

the program manager with a core group of 10

personnel assigned to the program office, while

another 20 personnel from various functional organizations provided technical support on an “as

needed” basis.

The Mirage Program Manager has life-cycle

responsibility for the aircraft including major

upgrades and integration of new weapons as they

enter the inventory. More specifically, he develops the acquisition strategy (shared with the

buyer) and manages the program within the cost,

schedule, and technical guidelines of the approved program. He is responsible for working

obsolescence, a source of continual problems

for older aircraft. When a modification or update is needed to the aircraft, he will work scheduling issues with the FAF, SMA, and contractors to incorporate the modifications into the

aircraft. When the aircraft is delivered, the PM

has the obligation to ensure that the support systems — support equipment initial spares, training and other initial items-are also delivered.

While he is responsible for updates to the

Mirage, he is no longer responsible for the

operational and logistics support of the system.

The Air Force plans, budgets, and orders operational repairs to the aircraft with SMA or the

contractor, as appropriate.

The Program Office also operates as part of an

Integrated Program Team (IPT) with the French

Air Force (discussed later). The DGA, the AFCA

and the Headquarters Staff of the Air Force are

all located on the same base, which makes teaming and working together a simpler business.

Another primary interface for the PM is the

Architect of Systems Forces (ASF) from the

Directorate for Force Systems and Trend Analysis (DSP), specifically, the ASFs for penetration,

air superiority and nuclear deterrence on issues

relating to Mirage.

Other organizations support the program office.

They include personnel at the test center at Istres

in the south of France near Marseilles and at the

Dassault Aircraft plant18 near Bordeaux (for

acceptance of the aircraft).

A recent organizational change moved responsibility for logistics or sustainment to a new

central defense department called Institute for

Service for the Maintenance of Aeronautical

Material or by the French acronym — SIMMAD

(Structure integree du maintien en condition

operationnelle des material aeronautiques).

Tactical Missiles Program

Division (DSA/SPMT)

The SPAe is the largest of the six DSA divisions. A sister division, SPMT, providing tactical missiles to the military services, is an interesting contrast. A two-star armament engineer

leads it. It employs about 150 persons to support the program offices. They have 50 personnel working directly in their program branches.

Examples of the types of programs managed in

SPMT include Unmanned Air Vehicles (UAVs)

and air-to-air, surface-to-air and air-to-surface

missiles for all three services. They have 650
Chapter 4 French Mirage 2000 Program

4-7

active contracts and they perform about 450

contractual acts per year. Forty to fifty percent

of their work is involved in cooperative programs

with other nations.

Integrated Program Teams (IPT)

During the tenure of Yves Helmer (the former

DGA), the concept of Integrated cross-disciplinary Program Teams (IPTs), became the core

management approach for armament programs,

although integrated teamwork was already a

general practice on major aircraft programs. The

IPTs for the Air Force Combat Aircraft Division (Avions de combat-armee de l ’air) and the

individual programs, such as the Mirage 2000,

each are responsible for achieving program

goals. The teams are formed, depending upon

the circumstances, with appropriate personnel.

The IPT for some efforts, but particularly for

the relationship between the Air Force Headquarters staff and the DGA, is critical to ensure

all parties are aware of program progress and

each organization’s needs. This is a permanent

IPT, headed by the PM with the Program Officer, which meets on a regular basis for programmatic issues. Often industry members may

be a part of the program team. Another example

of an IPT, created for a specific event, is the

request for proposal. For a new buy, an IPT

would develop a request for proposal. It is

headed by a project manager and the responsible technical personnel — buyers, the Air

Force Program Officer, cost analysts, and others

as appropriate.

Typically a team is composed of 10 to15 core

team members with the specialist included as

necessary (see Figure 4-5.) DPM, DSP and the

other directorates supplement the SPAe/GP and

ST with technical or management specialists

when needed. One of the basic principles of the

IPT is to get away from the old sequential model

of working an issue or problem — DGA reviews,

Figure 4-5. A Matrix-like Organization to Manage Programs

ILS and Through Life Support

Common Technologies and Equipment

Technical Domain Y

Technical Architecture X

Strategic and Economic Intelligence

Operational and Technical Studies

Technical Regulation Standards

Industrial and International Affairs

Human Resources

Management Control

Program Service Director

Plans, Program, Budget, Finance

Methods, Plannings, Costs

Quality

Purchasing

Cost Expertise

Management Division

Technical Division

DPM

DSP

DRI DCI

DSP

DPM

DRI DCI

DRH

DGO

DPM

Project Director
The Falcon and the Mirage: Managing for Combat Effectiveness

4-8

then the general staff reviews and so on. Rather,

working as a team accelerates the process,

contributes to better decision making, and creates a “team atmosphere” as common program

objectives are identified.

THE PROGRAM MANAGERS

The selection, education, training, and career

paths of military acquisition personnel (referred

to as Armament Engineers in France) differ significantly when contrasted to the U.S. approach.

The typical Armament Engineer, a member of a

fourth branch of the military, receives his education with a heavy emphasis on mathematics

and sciences, and graduates from one of the most

distinguished schools in France, the Ecole Polytechnic. His selection is part of a national process to select the very best achievers for service

to the country. From the beginning of his career,

he is a full-time acquisition professional (although after graduation he will do a tour of duty

for one year with one of the military services).

This section takes a look at the nine people who

have managed the Mirage program over the last

28 years (see Figure 4-6). The first Program

Manager was l’ingénieur en chef de l’armament

(ICA) Pierre Tamagini. ICA Tamagini and a

small office staff managed the Avion de Combat Futur (ACF), (as the plane was known then)

through its development until it was determined

in 1975 that the Ministry would develop and buy

a less costly aircraft — the Mirage 2000. He

then became program manager for the Mirage

until 1980, when ICA Yves Michot replaced

him. The program has always been managed by

an ICA, in the upper half, with the equivalent

rank of colonel.

Figure 4-6. Mirage 2000 Program Managers

Name Time Period Career

ICA PIerre Tamagnini 1873 to 1980 Programme manager for Avion de Combat

Futur) finished Career IGA (***) as CEV

Director

ICA Yves Michot 1980 to 1984 CEO forAerospatiale Aircraft Division

before the merger with Matra

ICA Herve Groualle 1984 to 1987 Finished his career IGA (***) as CEV

Director

ICA Jean-Luc Monlibert 1988 to 1990 Currently IGA (***) Director of DGA/DGO

ICA Francois Flori 1990 to 1991 Currently IGA (***) DGA/DPM/SQ

ICA Pierre Bascary 1991 to 1996 Currently IGA (***) Director of Ecole

Nationale Superieure de l’Aeronautique et

de l’Espace

ICA Bruno Delor 1996 to 1997 Currently IGA (***) Sous-directeur achats in

DGA/DPM

ICA Patrick Dufour 1997 to 2000 Currently ICA in CHEM and IHEDN

ICA Bruno Berthet 2000 to Present Current Programme Manager
Chapter 4 French Mirage 2000 Program

4-9

What are some of the attributes of the job and

the characteristics of the personnel that have

managed the Mirage? First of all, it has been a

good position for future promotion. Six of the

first seven have gone onto the rank of Ingeniuer

General de l’armament (IGA) with four rising

to the rank of three-star general. ICA Yves

Michot moved to industry becoming the CEO

of Aerospatiale prior to the merger with Matra

and has since retired. One of the requirements

for selection as a Program Manager is a technical background in aeronautics. Thus all PMs

have attended Ecole Nationale Supérieure de

l’aéronatique et de l’espace (Sup’Aero) for their

initial education in aeronautics. From there they

were assigned to an aeronautics test center to

increase their technical knowledge. The DGA

approaches program management with the belief

that a solid technical background is necessary

to success in the PM job. All PMs were a part of

the “air” branch of the armament engineer corps.

The current PM, Bruno Berthet, brings the usual

technical credentials, but also brings a background as a fighter pilot in the French Air Force

in Salon and Tours (as did three prior PMs).

Patrick Dufour, his predecessor, while not a

fighter pilot, did possess a general aviation

license. Several others possessed pilot credentials. Typical was Pierre Tamagnini, the first PM,

who according to a former colleague, “as a

young officer he attended the fighter pilot course

of the Air Force, then spent almost 15 years in

the flight test center (CEV) in Istres where he

attended EPNER (Ecole de Personnel Navigant

d’Essais et de Réception) and graduated as a

flight test engineer and was at one time chief of

the aircraft department of the flight test center.

As I recall, he flew almost every type of aircraft

— short of prototypes — as a pilot, and on

prototypes as a flight test engineer.”19

From an educational perspective all Program

Managers were graduates of the same two

“Grand Ecoles,” — the Ecole Polytechnique

(Masters Degree) and Sup’Aero (aeronautics).

The average amount of acquisition experience

brought to the job by each person has been 16.8

years of acquisition experience in test centers

and in program departments. What types of experience have these military personnel brought

to the job? As indicated above, most bring a technical experience, having worked in DGA test

centers. Of nine program managers, five had

long experience in flight testing at the Centre

d’essais des Vol (CEV) in Istre in the south of

France near Marseilles, two in structural testing

in Centre d’essais Aeronautiques de Toulouse

(CEAT) and one in engine testing in Centre

d’essais des Propulseurs (CEP). The length of

time spent as the Mirage PM averaged 3.75 three

years per person, with Tamagnini staying the

longest at seven years and Bruno Delor the shortest at one and a half years. The general DGA

policy for many years was to assign a PM to

program for approximately five years. This

changed under the administration of Jean-Yves

Helmer when the goal was changed to three

years.

PROGRAM PERSONNEL20

What types of people work in a DGA program

office? I will examine a variety of variables in

this section to provide insight into the characteristics of the personnel and certain aspects of

acquisition personnel management in France.

These variables include the number of personnel assigned, the types of personnel by function

and whether they are military or civilians, their

educational backgrounds, and their acquisition

experience. The nucleus of the Aircraft Combat

Program office is small with only five personnel assigned. Four personnel are armament engineers with the fifth an IETA. Approximately

30 to 50 matrixed personnel support them. The

types of personnel assigned that provide matrix
The Falcon and the Mirage: Managing for Combat Effectiveness

4-10

support to the program office on a regular basis

(although not full time) are shown by functions

in Figure 4-7.21

The distribution of military and civilians is

shown in Figure 4-8. The program office has 14

military officers assigned to support the program. They consist of 9 armament engineers and

5 Ingénieurs des Etudes et Techniques d’Armement. The balance of the program office support

consists of 26 “fonctionnaires” (civil servants),

along with four ICTs (contract employees).

Note that armament sales do not play a significant role in the work of the program office, since

France does not normally have government-togovernment sales. Rather, industry is responsible

for armament sales. Normally, the PM will be

called to respond to questions regarding a sale

and provide his advice.

Education and Experience

Data is gathered from respondents using the survey in Appendix D. The 40 responses received

Figure 4-7. Program Office Personnel by Function

Functions Numbers

Achats (Purchasing) 9

Qualite 2

Plans, programs, budget, finance 3

Management de programme 3

Logistics 4

Engineering 18

Test and Evaluation 1

TOTAL 40

Figure 4-8. Program Office Personnel Distribution

Military Civilian

Rank Rank

Ingenieur de l’armement Fonctionnaire

IA 2 Niveau 1 5

IPA 3 Niveau 2 15

ICA 4 Niveau 3 2

ICT 4

Ingenieurs de Etudes et

Techniques d’armement

I1ETA 2

IPETA 3

Subtotal 14 Subtotal 26

TOTAL 40
Chapter 4 French Mirage 2000 Program

4-11

represent personnel who spend at least a portion

of each day performing work for the program

office. Of these 40 personnel, nine are graduates of the Ecole Polytechnique — all armament

engineers who graduated from Sup’ero and are

in the “air” arm of the Armament Engineer

corps. One had overseas training with an MBA

from Stanford University in California. Of the

five IETAs, all had graduated from the Ecole

Nationale Supérieure d’Ingéniuer de Constructions Aéronautiques (ENSICA) (a Grand Ecole).

Sixteen had received technical degrees, including two of the buyers (ICTs) who attended

advanced training at Ecole Nationale Supérieure

d’Ingénieurs (ENSI). The average amount of

acquisition experience is approximately 10.5

years, with 2 having less than two years, and

with 45 percent having over 10 years of acquisition experience. Several respondents indicated

they had received a variety of acquisition training

to include the program management course at

CHEAr, as well as other DGA internal training,

procurement training, and fighter-pilot training.

Training and Turnover: One of the areas of

emphasis within the DGA is training. Every one

of the functional areas identified above has a

senior manager responsible for ensuring each

of his personnel receives training. It is done on

an informal basis, mostly through short courses

of one or two weeks. Current DGA planning

includes having PMs stay three years on the job

and then move on. This was signed into policy

by the former DGA, Yves Helmer.

MANAGEMENT PRACTICES

This section looks at the way the AFCA manages its work. What are the types of work performed? How much management authority is

delegated? What are the pressures from outside

sources (customers and bosses)? And how is

work controlled? The problems faced by the

Mirage PM are typical of those found in many

offices — getting things started, getting the right

people, as well as making sure objectives are

set and then met. Major day-to-day work issues

include staffing, relationships with the contractor(s) and their customer (Headquarters Air

Force), and the budgeting and financing necessary to manage the program. In a matrixsupported organization, a significant amount of

program office time is spent ensuring availability of personnel to support work efforts. With

the contractor, negotiating new contract work

efforts and oversight (review of program status)

of current contract requirements absorbs considerable program office resources. Currently

the program office has two program reviews per

year, mostly with Dassault since they now have

system responsibility. In the past, when the

program office used a different acquisition

strategy and contracted with several contractors,

program reviews were much more extensive.

One of the important areas of coordination mentioned was to ensure they agree with their customer (the Air Force), and in particular the

Program Officer, so they meet Air Force needs

and address funding issues. And finally there is

always the need to provide their input to the

annual budget submissions. Other taskings

important to the program office operations

include preparation of an “acquisition plan,”

which includes program risks, key issues, major

operations, and of course, monitoring the plan.

The work performed within the AFCA is first

and foremost acquisition work. This means the

development of systems or subsystems, integration into aircraft and production of new aircraft,

plus the development of the initial support structure. The Mirage 2000 has reached the end of

its production life with 12 Mirage 2000Ds

delivered in 2000 and the final production aircraft delivered in the spring of this year. The

remaining work for the program office will be

primarily aircraft updates and modernizations

with a current life expectancy through the year

2020. At present nothing indicates any future
The Falcon and the Mirage: Managing for Combat Effectiveness

4-12

production buys, internal to France, although the

United Arab Emirates and Greece have indicated

a desire to buy additional Mirage 2000s.

Eight general categories of work or functions

are performed in ACF Program Office: Program

Management; Achats (Purchasing); Qualite;

Engineering; Plans, Programs, Budget, and

Finance; Logistics; Test; and finally, Armament

Sales Support. The preceding chart provides a

breakout of some of the activities that take place

within each function. Within each function are

processes and procedures for managing work

and for contributing to the acquisition of a

product. These all come together through an IPT

effort. This is where the members bring their

functional expertise to make decisions for the

program.

Decision Making

What types of decisions are made in a program

office? Who makes them? What type of decisions does the PM delegate to his staff? What

are the senior levels a Program Office must go

to for approval? How often do they need to go

to senior levels? These are some of the questions

this section will answer.

Once a decision has been made to acquire a new

weapon system,23 administrative personnel and

political appointees agree to meet certain cost,

schedule, and technical goals. These become the

mandatory requirements for the Program Manager. The PM during the acquisition cycle prepares a series of documents — Feasibility, Orientation, Realization Launching and Production

Figure 4-9. Program Office Tasks Performed

Program Management – Integration of program activities, Program Strategies, Program

Reviews, Workforce and organization shaping, Contractor Oversight.

Achats (Purchasing) – Acquisition Strategy, Negotiation, Evaluation of Proposals,

Contract Preparation, Award and Administration, Modificatin of Contracts.

Quality – Specification preparation, Oversight of contractor, contractor’s procedures,

Configuration Management, and review of contractor preparation for production,

acceptance and qualification of aircraft.

Engineering – Specification preparation/approval, design reviews, contractor oversight.

Plans, Programs, Budget, and Finance – Preparation of the Program budgets,

management of internal financial resources, schedules, financial forecasts, review

of the Contractor program financial status.

Acquisition Logistics/Logistics Support – Supply support preparation, initial

provisioning, development of test equipment, reliability/maintainability

assessments, authorize technical orders.

Testing – Test and Evaluation Planning, preparation and review of test plan.

Armament Sales Support –
Chapter 4 French Mirage 2000 Program

4-13

Launching — which capture cost, schedule and

performance requirements and changes as a

result of research or development efforts.

Management reviews and oversight are rather

straightforward in the DGA. The PM has one

major yearly review with the DGA and the Air

Force staff where he lays out his plan to accomplish the cost, schedule, and performance mandates. Once approved, he manages the program

within those guidelines until the following year

— providing that he stays on the approved path.

With the emphasis on reducing cost, all the DGA

PMs are required to establish cost-cutting

objectives and then report yearly success in

meeting those objectives. Note that the PM has

immediate and direct access to the Head of SPAé

who in turn has immediate and direct access to

all DGA directors and to the Delegate.

When new acquisition is planned, the PM will

prepare with the buyer an Acquisition Strategy

Document that provides a description of the

system and the planned contracting approach,

including the sources. The Director for Programs, Procurement, Methods, and Quality

(DSA/DPM) will approve this or recommend

higher-level approval, if appropriate.

Several events can trigger the necessity of the

program office to go back to senior leadership

for approval. Obviously, when the program cost,

schedule, or technical performance requirements

are not met, senior management must be briefed

and new goals established. Approval of a contract action more than FF30 million (USD$2.1

million) requires review and approval from the

Commission Spécialisée des Marchés, a part of

the Ministry of Economics, Finance and Industry in Bercy. Nevertheless, French regulation

states that Bercy can only check on the compliance of the contract with regulations, not on the

relevance of the need.

Reform Initiatives

Over the last five to six years, the Ministry and

the DGA have embarked upon major reforms.

Sanctioned by the “Loi de programmation”

mentioned earlier, they have started a process

of moving to an all-volunteer military force and

Europeanizing their focus. In the DGA they have

shifted from a technical performance, i.e.,

achieving technical performance at the expense

of cost and schedule, to acquiring a more businesslike viewpoint in managing a program. They

have also begun the privatization of their industrial enterprises, changed the relationship to

industry, and tried to find ways to reduce the

cost of weapons. For program offices, the cost

reduction initiative has had an immediate effect.

They have to set goals and must report their success in meeting the goals. (A personal letter from

the Delegate to the PM sets cost reduction

objectives.) The second impact to a program

office will change the business relationships

internal to the DGA. All program offices in the

future will have to fund and pay for services that

had hitherto been free. As an example, the Istres

test center, which used to provide services without a charge to the PM, now must provide a

cost estimate for the work they perform. They

will sign an agreement with the PM on the tasking and the cost. In the future it is planned that

these efforts will require the PM to pay for their

services.

Outside Influence

Located in Paris, the center of government in

France, the Mirage program would be expected

to have significant political involvement. In my

interviews with the program managers and other

program personnel, past and present, the general level of political involvement is low. With

the aircraft in mid-life, it does not generate a lot

of interest from either the press or the politicians. When the aircraft was first developed, it

experienced significant involvement from all
The Falcon and the Mirage: Managing for Combat Effectiveness

4-14

levels within the executive branch of government. The ministry in particular was heavily

involved of the program. After it started production, the government generally supported it;

although when Francois Mitterend was elected

President in 1982, it was a time of concern for

the program. During this time with low interest

in the program by the government, quantities

did initially drop below plans, although they

shortly returned to their programmed levels. In

the last couple of years they have experienced a

lot of cost reduction pressures from the ministry. Generally, in looking at the various organizations that could influence the program office

— parliament, cabinet, Ministers office, DGA

headquarters—most were rated as having very

little, if any, impact on program office work by

key personnel. The Headquarters for the French

Air Force is rated medium because of the normal day-to-day workings with the Program

Officer and other FAF units. Contractors additionally provide outside pressure with the desire

to sell new equipment to the program office

or simply to minimize their commitments in

existing contracts.

Configuration Control

Configuration control responsibility for the

Mirage rests with the contractor(s). Internally

in the DGA the configuration control function

is the responsibility of the Program Manager.

He chairs the Configuration Control Commission and has membership from the technical

functions (DPMSQ — Quality Division), and

the users. DPMSQ performs the technical and

administrative functions of evaluating the ECP,

verifying its technical capability, and the administrative function of logging it into the system.

And configuration control can be complicated

with many different versions — one configuration for the French Air Force, another for export with perhaps three versions of the engines

and five different versions of the radar. While

the PM does not approve the configuration

changes for export, he is often called upon to

provide his opinion on the proposed change.

In discussing the configuration control process,

two example were used — the Rafale and the

Mirage. The Rafale is France’s newest fighter,

with the first production units delivered to the

FAF in 1998. For a new aircraft like the Rafale

fighter, more frequent configuration change

meetings are necessary. Thus the Rafale program

office conducts two yearly meetings of the Configuration Control Commission (CCC) to determine which change will be incorporated into the

aircraft. The Mirage program office, on the other

hand, holds one yearly meeting. On average it

would be typical to approve about 100 changes

a year, mostly very minor with a few significant

changes.

One of the key questions facing the commission is: Is the change significant enough to require a new standard (this equates to a new block

within the F-16)? An example of the need for a

new standard would be a change to incorporate

the air-to-air, MICA (missile d’interception et

de combat aerien) missile. Configuration stability of the aircraft may be one of the hallmarks

of their management approach. During the sixyear contract for the Mirage 2000-5, they only

had about five to six contract changes, and one

of these was preplanned.

In planning the initial contract, they were up

against a deadline, and the technical specification for a new electronics system could not be

finalized. Thus they initially incorporated an old

system into the contract to start the effort. But

shortly thereafter, they were able to complete

the new technical specification, negotiate a price,

and add the new electronics system to the contract. Additional changes were required after the

Air Force found problems testing the firing system and the radar. Maintenance problems also

required additional changes to improve maintainability. The contractor had some development
Chapter 4 French Mirage 2000 Program

4-15

problems that also required changes to the contract. The contract was awarded in 1993 and all

the changes were incorporated prior to actual

approval of the aircraft for production in 1995.

Budget and Budget Process

They have three budget preparation plans — one

long-term for 2003-20015, one mid-term for

2003-2008, and the next year’s budget. Since

the Air Force actually owns the money the DGA

budget personnel expend a significant amount

of effort working with their Service counterparts.

With efforts to reduce cost and differences in

the planned (programming law) versus the actual

budget, the DGA program offices perform a lot

of “What If” exercises regarding changes to outyears. Parliament is not an issue on specific

budgetary problems. Rather the Minister of

Economy and Finance, in Bercy, performs the

role of determining what the cuts to the budget

will be, “often without apparent regard to programmatic issues.”24 Within the staff, the budget division (SPAe/GP/ GPPP25) supports the PM

both in budget preparation and in tracking and

accounting for program authorizations. It is interesting that money for production, R&D, and

O&M can be rolled over and used in the next

fiscal year, although they too track it separately.26

BUSINESS ARRANGEMENTS

Four major contractors are involved in the program. They include the primary contractor for

new production aircraft Dassault Aviation Company, Thales for radars and for electronics items;

Matra for missiles; and SNECMA for engines.

There are 15 contracts directly supporting the

Mirage 2000 and another 50 contracts supporting contract work for the Mirage 2000. As an

example, an umbrella-type contract covers engines for the Mirage 2000, the Rafale and others with SNECMA. Of 50 contracts, 5 to 10

contractors provide software support and other

technical assistance. The traditional acquisition

strategy was discussed earlier; the program office contracts directly with subsystem contractors and provides items as Government-Furnished Equipment to the primary contractor for

incorporation. Mirage 2000 contracting is done

primarily sole source with fixed price contracts.

Figure 4-10 shows the SPAe contract activity

(new contracts and modifications to existing

contracts), as well as the ACFA contract amounts

spent over the last three years (SPAe in Euros

and ACFA in U.S. dollars).27

SPAe has about 100 buyers assigned; of these,

about 20 buyers support the Mirage 2000

program on an “as needed” basis. Typically they

would manage their contracts by assigning one

Figure 4-10. SPAe Contracts Activity

Fiscal Year

1998 1999 2000

New Contracts 468 417 321

Modifications 1843 1181 1585

Value (in Euro) 772m 335m 365m

ACFA Value (in FF) 2.4b 1.9b 1.4b

Value (in Dollars) 334m 264m 195m
The Falcon and the Mirage: Managing for Combat Effectiveness

4-16

buyer for a development contract, one for a production contract, and one for each of the major

subsystems (such as a radar). Their requirements

tend to be very stable, and they delay the changes

until the appropriate time to incorporate them.

Who can sign a contract? The SPAe Director

has unlimited authority to sign and has delegated

authority for contracts under 60 million French

francs (15 million for development/studies) to

his deputies and deputy directors.28

A contract IPT has the responsibility to generate the contract. In the normal process, the buyer

meets with the PM, his deputies, and also a specialist in law to review the contract for compliance with the rules and regulations. Once all are

satisfied, and if the contract is over 30 million

French Francs, then they go to the Commission

Spécialisé de Marché in the Ministry of Economics, Finance and Industry for approval. A

constant problem has been to comply with the

competition requirements of the government. It

is typically an item of concern on the part of the

Commission.

Contract Administration is performed both in

the program office and at the contractor’s plant.

As mentioned earlier, 23 people work at Dassault

on final acceptance of the aircraft. Contractor

payment is made up-front with an initial payment of 5 percent of the first year’s payments.

They make quarterly payments, tied in with a

milestone accomplishment. Contractors are

required to have an adequate accounting system

to track cost. This is generally only a problem

for some of the smaller contractors. Once the

contractor submits an invoice to DGA, the ST

technical person responsible for the aircraft

reviews the invoice and signs off. (They do this

for several reasons: (1) the technical person has

the knowledge of the work being done, and (2)

he has specific responsibility by law for the airworthiness of the aircraft (naval and terrain

vehicles do not have the same restriction). Next

it goes to the buyer who reviews it for compliance with the contract. Next it goes to the

accounting specialist for review of the financial

information. Finally it is sent to the Treasury

Department, which makes the payments.

SUMMARY

Several points to note on the organizational

structure include the decision making process,

personnel selection, and the politics of defense

acquisition in the DGA. With the completion of

the last of the planned Mirage 2000 production

buys for the FAF, the DGA restructured the

Mirage 2000 Program into a new office — the

ACFA, which now includes several older aircraft programs. Small, with only five full-time

personnel assigned, it operates on a matrixed

basis calling upon its parent organization, SPAe,

for most of its support resources. The DGA and

its major headquarters units are all located centrally in Paris; the Mirage 2000 Program Office

(ACFA) is located within walking distance of

its customer — the French Air Force. The decision-making process tends to be somewhat

informal, although there are yearly briefings to

senior military and political leaders. The PM is

given significant leeway in managing his program as long as he stays within cost and schedule goals. Probably reflecting this informality,

the regulatory procedures governing management of programs and contracting are more

broad-based and less prescriptive. The selection

of key individuals to become future DGA leaders reflects a national selection process with an

intense concentration on mathematics and science. Future PMs continue this technical track

with their advanced training and their initial job

assignment. In several interviews, personnel

often described the work atmosphere as a

“family framework” — personnel come from

the same schools, know each other, and the

organization is small.
Chapter 4 French Mirage 2000 Program

4-17

Finally, programmatic issues are generally not

political within France. This is probably true for

several reasons — the role of the cabinet within

the government, the industrial champion notion,

and the lack of legislative involvement in the

details of programs. The PM is thus able

concentrate more on business and technical

problems and less on political issues. This is not

to be confused with lack of oversight, since audit

organizations, such as the Compte de Cour,29

exist to perform audits of programs. The technical and managerial problems of the aircraft

carrier, Le Charles De Gaulle made front-page

news on Paris newspapers.
The Falcon and the Mirage: Managing for Combat Effectiveness

4-18

ENDNOTES

15. It only refers to the development approval.

The Air Force does the final acceptance for

operational use, with the help of the concerned DGA department, when technical

help through contracts are needed.

16. Division Gestion des Programmes.

17. Although they are not lawyers.

18. About 21government, DGA personnel are

located at the Dassault plant.

19. From IGA Bernard Besson, a friend and coworker with Mr. Tamagnini for almost 15

years.

20. While the subject of this project is the Mirage 2000, the program office has now incorporated several other aircraft. Thus the

responses reflect total ACFA work, rather

than just the Mirage 2000, although the

Mirage still is the primary aircraft in the

office.

21. Forty responses were received to the questions in Appendix D.

22. ENSICA is located in Toulouse France.

23. Their Ministerial Document # 7576 provides a list of programs that are considered

to be a major program.

24. Uncited source within the government.

25. They have about 50-55 people in accounting, finance and plans, with about 20 personnel in payments and authorizations.

1. Quoted from Carlier (cover).

2. Future Combat Aircraft.

3. Carlier, Claude and Luc Berger, Dassault:

The Corporation, 1945 – 1955, 50 Years of

Aeronuatical Adventure, Vol. 2, Editions by

Du Chene-Hachette Livre, 1996, pg. 274.

4. Carlier, pg. 274.

5. Carlier, pg. 276.

6. Mirage, pg. 105.

7. Dassault has produced 315 aircraft, plus

seven prototypes of the French Air Force

and has on order 286 aircraft, with 60 yet

to be delivered, plus four prototypes for

foreign customers.

8. Combat and Air Intercept missile.

9. The result of the merge of former ThomsonCSF, Dassault Electronics and UK Racal.

10. SNECMA government-owned company

best known in the US for its (50/50) partnership between General Electric in CFM

International, headquartered in Bordeaux,

France.

11. Directeur des systèmes d’armes.

12. Only three of them are civilian.

13. In French Avions de Combat de l’Armees

de l’Air.

14. Division des Systèmes et Techniques.
Chapter 4 French Mirage 2000 Program

4-19

26. There are some one-year type funds that

can only be used in the year authorized.

27. It is estimated that about 1/8th to 1/9th of

new contracts and 1/10th of the modifications are dedicated to Mirage 2000 program.

28. He has three deputies. In the GP division

they have 4 persons authorized to sign at

the same franc level.

29. Similar to the U.S. Government Accounting Office (GAO).
The Falcon and the Mirage: Managing for Combat Effectiveness

4-20
Chapter 5 United States F-16 Program

5-1

Chapter 5

 UNITED STATES

F-16 PROGRAM

the Air Force looked to complement the F-15

with a lightweight, low cost, air-to-ground

aircraft.

The F-16 was the answer. But the answer did

not come easily. Once the Air Force had committed to the F-15, senior leaders within the Air

Force were reluctant to sponsor any conflicting

program that might imperil funding for the F15. Operating in obscurity “from 1972 until early

1974, the prototype programs (under two colonels and with a small system program office at

ASD, in Dayton, Ohio) were spared interference

from the Air Force in Washington.2

” Colonels

Lyle Cameron and Bill Thurman were in charge

of developing a prototype aircraft not only

matching those needs, but also demonstrating

new technology, such as fly-by-wire. In what

one writer refers to as the Schlesinger Compromise,3

 named for former Secretary of Defense

James Schlesinger, the Air Force agreed in 1974

that a less expensive alternate to the F-15 was

needed. A competition was held, and based upon

the flight tests of the General Dynamic’s (GD)

YF-16 versus the Northrop YF-17, the Commander of the Aeronautical Systems Division,

Lieutenant General James T. Stewart selected

the GD aircraft. It entered Full Scale Development4

 in January 1975 with GD receiving an initial order for 15 F-16s at a total price of $417.9

History

It was not the war the planners in the Pentagon

envisioned. F-86s had ruled the skies over Korea, shooting down ten enemy planes for every

American plane lost.1 Only a decade and a half

later, on the good months in Vietnam, it was “one

for one.” Other months, they won! The United

States needed a plane that could provide air

superiority over Vietnam. And once Vietnam

ended, air superiority was necessary to meet the

tremendous tactical advantage the Russians enjoyed with their more numerical air forces. The

United States possessed a clear advantage in airto-air combat in Korea. Yet in Vietnam American pilots faired poorly in the early air-to-air

combat exchanges with the MIGs flown by

the Vietnamese. Complicating the war planner’s

job was the introduction of the Soviet Mach 3,

high-altitude Foxbat, and the technical and cost

difficulties with the F-111.

The United States needed a new air-superiority

fighter. The solution was the F-15 Eagle. In 1972

the prototype F-15 fighter rolled out on the runway to take off on its initial flight test. Four years

later the first production units were delivered to

operational forces. But despite its operational

abilities, the F-15 had one drawback — it cost

about $11 million per copy. Also the Vietnam

War had ended and the threat was now seen as

the large number of aircraft fielded by the Warsaw Pact nations. With the high cost of the F15, the Air Force could not field the quantities

of aircraft necessary to meet the Soviet threat.

In what is referred to as the “High-Low Mix,”
The Falcon and the Mirage: Managing for Combat Effectiveness

5-2

million. The plan was to acquire a total of 650

aircraft at an average cost of $4.6 million per

plane.5

 In 1978 the first production F-16 Fighter

rolled off the manufacturing line at the former

General Dynamics, now Lockheed Martin Aeronautics Company (LM Aero)6

 plant, in Fort

Worth, Texas.

The F-16 was also the first multinational production plane for the United States when the

countries of Denmark, Norway, Belgium and

The Netherlands selected it over competition

from Northrop’s Cobra and YF-17, Dassault’s

Mirage F and Saab’s Viggen. These countries

committed to buying 348 air combat fighters.

Forming a multi-national program office in Dayton, the so-called European Participating Governments (EPG) along with the United States

coordinated the development and production of

the F-16. The work with the EPG allowed the

United States to share the development and production cost of the aircraft. Assembly lines were

opened in Belgium and The Netherlands where

European components were attached to F-16s.

Subsequently other countries started expressing

interest in the F-16 originally Canada, Iran,

Israel, Pakistan, Australia, Korea, Greece, Egypt

and Turkey. Currently the total number of F-16s

delivered and on firm orders stands at 4,285.

The F-16 has been in continuous production

around the world since 1978, including by

SABCA in Belgium, Fokker in The Netherlands,

KAI in South Korea, Turkish Aerospace Industries (TAI) in Turkey and by Mitsubishi Heavy

Industries in Japan (a derivative of the F-16).

Of the five multinational co-production assembly lines, only the LM Aero, Fort Worth, Texas

line is still open. Korea recently completed it

production run. More than 4000 have been

manufactured over the last 24 years. The United

States bought a total of 2240 F-16s, and as of

March 2001 was still flying 125 of the A/B models and 1269 of the C/D versions. The United

States Air Force (USAF) continues to buy F-16s

for force sustainment. Congress is primarily

responsible for continuing U.S. buys in the last

several years. They have directed through

Appropriations Acts, from FY96 through 99 and

FY01, for the USAF to purchase additional

Block 50 configuration aircraft. The FY00 procurement was introduced to Congress via the

President’s Budget. To comply with congressional direction, the F-16 System Program

Office (SPO) awarded a contract in December

2000 to LM Aero-Ft. Worth. Thus Calendar Year

2000 was a good year for LM Aero with 234 F16s bought for both foreign military sales (FMS)

and the USAF. Current production is expected

to continue through 2010.

The nineteen countries that currently fly the F16 are:

• USAF – Air Combat Command (ACC),

Pacific Air Forces (PACAF), United States

Air Force Europe (USAFE), the Air National Guard (ANG), Air Force Reserve

Command (AFRC) and the Air Education

and Training Command (AETC), United

States Navy (USN)

• European Participating Air Forces (EPAF)

– Denmark, Belgium, Norway and The

Netherlands, Portugal

• Foreign Military Sales (FMS) customers

– Bahrain, Egypt, Greece, Israel, South

Korea, Singapore, Taiwan, Turkey, Thailand, Venezuela, Jordan, Indonesia and Pakistan.

The United Arab Emirates (UAE) contracted

with LM Aero to buy F-16s and will be country

“number twenty.” Italy signed a Letter of Offer

and Acceptance (LOA) for refurbished aircraft

and will be country “number twenty-one,” while

Chile will be number “twenty-two.” Several other

countries are interested in either buying or
Chapter 5 United States F-16 Program

5-3

leasing existing F-16s from USAF inventories, or

buying new ones from LM Aero.

The F-16 is in its midlife. It has been one of the

USAF’s premier combat fighters. And it will

continue to be so in the future. Major upgrades

for all F-16 versions are being incorporated to

keep the fleet modern and fully supportable over

the aircraft’s long service life. While its genesis

began in the early 1970s, it will be around long

enough for the grandchildren of the first pilots,

and perhaps their great grandchildren, to fly it

in the 2024 timeframe, its current scheduled date

for removal from the inventory. With half of the

USAF combat fighters being F-16s, it deserves

its name — “The Fighter of Choice.”

F-16 – The Aircraft

While the F-16 was initially to be an air-to-air

day fighter, it was later converted to an allweather night fighter. It was also designed with

maintainability as a priority to make it simpler

to maintain with easily removable access panels, locations of avionics boxes, and built-in-test

(bit) systems, installed to pinpoint technical failures. Originally ordnance was limited to a gun

and Sidewinder Air-to-Air Missiles. It has since

added more fire capability with the inclusion of

additional missiles, such as the Maverick and

AMRAAM (Advanced Medium Range Air-toAir Missiles) missiles. It is powered by either a

single General Electric F110 engine or by a Pratt

and Whitney F100 engine. With a range of 2,634

(nominal combat radius is 550 nautical miles),

it can attain a speed of Mach 2.0 plus above

40,000 feet. Figure 5-1 shows the many variants

of the F-16, upgraded in what is referred to as

“blocks.” The F-16A/B versions include Block

10/15, while the USAF F-16 C/D versions start

with Block 25 and continue through Block 50.

Block 60 is currently under development and

supports the UAE. It was recognized at the outset that changes would be a part of the life of the

aircraft. A formal change process was adopted

and given a name in 1979 — the Multinational

Figure 5-1. Aircraft Diversity

Features:

• APG 66 radar

• ALR 69

• ALE 50

• Fly-by-wire

• Digital/Int Avionics

• PW F100-200

Features:

• APG 68

• C/D HUD

• Have quick

• AMRAAM

• ALR 69

• PW F100-220

• GE 110-100

• MLU

Features:

• APSP

• War

• Lantirn

• GPS

• APG 68

• GAC

• ALE 47E

• AFR 56M

• Digital Flt Cntl Sys

• AIFF

• PW F100-220

• GE 110-100

Features:

• Digital Eng Monitor

• RLG

• HSD

• GAC/MMC

• APSP

• GPS

• UPDG

• APG 68

• Harm Avionics

• Expanded memory

• PW F100-229

• GE 110-129

Features:

• APG-78

• RLG INS W/GPS

• IFTS

• ALQ-2005

• Upgraded DFC

• 3 large color displays

• Color moving map

• EIPE

• Two-place equipment

dorsal

• Conformal fuel tanks

• 600-gal tanks

• 50,000 lb Max TOGW

2000

BLOCK 50+/60

• UAE Commercial Sale

• Norway 50N FMS

Competition 1990

BLOCK 50

1988

1982 BLOCK 40

BLOCK 20/25/30

1978/81

BLOCK 10/15
The Falcon and the Mirage: Managing for Combat Effectiveness

5-4

Staged Improvement Program (MSIP). MSIP

was a logical systematic upgrade of weaponry,

communications, navigation, and sensors. This

approach fostered the development, integration

and production of all the EPG members.7 While

the formal aspect of MSIP was discontinued in

1987, the general approach has continued, even

today. The F-16 satisfies multiple requirements:

Air-to-Surface (Interdiction and Suppression of

Enemy Air Defenses), Air-to-Air, Air Defense

Fighters, Close Air Support, and Reconnaissance.

MANAGEMENT STRUCTURE

AND APPROACH

The hub of activity in keeping the F-16 current,

making new buys, and ensuring its is ready when

needed, is the F-16 System Program Office

(SPO). The management environment the SPO

operates in is complex. The traditional approach

to organizing would be hierarchical — design

an organization chart that shows the headquarters,

major divisions, and then perhaps branches. This

organization structure does exist in the Air Force,

but over the last twenty years for a variety of

management and political reasons, several other

overlapping structures have been created. To

appreciate the Air Force management structure

and approach to managing programs, it is necessary to understand three organizational arrangements — the Program Executive Officer (PEO),

Command, and Integrated Weapon System

Management (IWSM).

It is also appropriate at this time to define two

terms used to distinguish the division of responsibility and management — acquisition and

sustainment. Acquisition refers to buying or

developing new equipment and modifying and

updating current equipment. It also important

to note it refers to the line of authority for acquisition programs, since they fall within the PEO

structure. Sustainment refers to maintaining and

supplying support for existing systems. Sustainment efforts are the command responsibilities

of the Air Force Materiel Command (AFMC).

(See Appendix C for the AFMC organizational

chart.)

As was indicated in Chapter Two, the PEO structure is used to manage programs. Figure 5-2

Figure 5-2. PEO Structure

Assistant Secretary of the Air Force

(Acquisition)

Service Acquisition Executive

Mrs. Darleen Druyun (Acting)

Air Force Program Executive Officer (AFPEO)

Major General Michael Mushala

AFPEO/FB for Fighter Bombers

F-16 Program Manager

Colonel Mark Shackelford
Chapter 5 United States F-16 Program

5-5

depicts the program management chain for the

F-16 SPO. This approach provides the short

“lines of authority” envisioned by the Packard

Commission. The second organizational arrangement is the normal line, or command relationship, flowing from Headquarters Air Force

down through AFMC to the Aeronautical Systems Center (ASC) and the Ogden Air Logistics Center (OO-ALC) (see Figure 5-3). In this

management arrangement AFMC, and in particular, the ASC Commander and the OO-ALC

Commander, have the responsibility to provide

the manpower, facilities, processes and procedures within which the F-16 SPO can operate.

However, they have no acquisition program

authority nor responsibility for a program managed within the PEO structure. Finally, as part

of its normal chain of command responsibilities, AFMC is tasked to logistically support, or

sustain fielded systems, such as the F-16. To support its sustainment tasks, AFMC created in the

early 1990s, a management construct, called

Figure 5-3. Command Structure

Headquarter United States Air Force (USAF)

Air Force Materiel Command

F-16 SPO

Colonel Mark Shackelford

F-16 System Support Manager

Colonel Ken Lewandowski

Product Center

Aeronautical Systems Center (ASC)

Logistics Center

Ogden Air Logistics Center (OOALC)

Figure 5-4. Acquisition and Sustainment Management Structure

HQ AF

SAE

PEOs Product Centers

Log Centers

HQ AFMC

Acquisition Staff Technical/Logistics/

Contract Support

F-16 Program Manager

F-16 Single Manager

PEO-Acquisition

Management

Sustainment

Management
The Falcon and the Mirage: Managing for Combat Effectiveness

5-6

IWSM. The basic purpose of IWSM was to have

one person, “the Single Manager,” with responsibility for a weapon system from “cradle-tograve.” To make this an effective approach it was

necessary to establish relationships between the

Single Manager and various organizations

within the command. This link was vital since

resources (manpower, facilities, equipment, etc.)

are allocated through the AFMC chain of command. This relationship also provides users who

fly F-16s with a “single belly button” to push

when they have a problem. This “Single Manager” for the F-16, located at Wright-Patterson

AFB, is also the same program manager (PM)

who reports up the PEO chain of command (see

Figure 5-4). Needless to say this command

framework makes the life of a PM challenging

as he tries to meet the demands of several bosses.

With this introduction as a framework, let’s look

more closely at the complexity of managing a

large organization, such as the F-16, within these

constructs. First of all, AFMC8 employs more

than 100,000 personnel geographically dispersed throughout the country (see Figure 5-5).

They have two main types of organizations to

manage acquisition and sustainment work —

Product Centers and Logistics Centers, respectively. ASC, commanded by a Lieutenant General, is a Product Center and located at WrightPatterson AFB. While OO-ALC at Hill AFB, is

a Logistics Center and its commander is a Major

General. The F-16 System Program Office is

split between these two locations.9

Aeronautical Systems Center (ASC) and

Ogden Air Logistics Center (OO-ALC)

ASC is the home of many aeronautical system

development, production and modernization

programs, such as the F-22 fighter aircraft, the

C-17 cargo aircraft, as well as the F-16 Fighting

Figure 5-5. Air Force Materiel Command
Chapter 5 United States F-16 Program

5-7

Falcon. OO- ALC, as a logistics or sustainment

center, provides engineering and logistics management for a variety of aircraft including the

C-130 Hercules, the A-10 Warthog, F-117

Nighthawk, and the F-16 Fighting Falcon. Also

located at Ogden, but not part of the F-16 SPO,

are other organizations that support the F-16

aircraft for the overhaul and repair of landing

gear, wheels and brakes, avionics, hydraulics,

software, and other aerospace related items.

The F-16 System Program Office (SPO)

A brownstone, 1920s Art Deco building on Area

B at Wright-Patterson Air Force Base houses the

F-16 System Program Office (SPO). More than

a generation of development, production, and

sustainment of the Fighting Falcon has been

managed. Currently Colonel Mark Shackelford,10 is both the Program Manager and the

Single Manager. As indicated, the SPO operates

in two geographically separate regions of the

country — “SPO East,” for the acquisition11

organization and “SPO West,” for the sustainment12 office. Colonel Ken Lewandowski, the

System Support Manager (SSM),13 has responsibility for the sustainment of the F-16 at “SPO

West.”

The SPO’s mission is to develop new capability, acquire new aircraft, modify existing aircraft

and logistically sustain the large operational

F-16 fleet for both the United States and foreign customers. To do this they are organized

into four main organizational groups (see Figure 5-6) with corresponding contingents at both

Dayton and Ogden:

1. Programs Group

Figure 5-5. Air Force Materiel Command

F-16 System Program Office (SPO)

ASC/YP (Dayton)

System Program Director: Colonel Mark Shackelford

Deputy Program Director: Mr. Chuck Jackson

Technical Director: Mr. Don Edwards

System Support Management Office (SSMO)

OO-ALC/YP (Ogden)

System Support Mgr: Col Ken Lewandowski

Dep System Support Mgr: Mr. Darryl Williams

Senior Engineer: Mr. Gary Strack

Programs Group

Dayton Ogden

Col Mike Costigan Ms. Linda Fields

Products Group

Dayton Ogden

Col Fred Gilbert Mr. Brent Berret

Logistics Support Group

Dayton Ogden

Mr. Mark Hollobaugh Maj Mark Mo

Business Group (Dayton)

Finance Contracting Administration

Mr. Tom Frye Ms. Dominique Myers Capt Peggy Bloom
The Falcon and the Mirage: Managing for Combat Effectiveness

5-8

2. Products Group

3. Business Group

4. Logistics Support Group

 The division of work is “generally” distributed

to “SPO East” for new development and production work, and to Ogden for supply support,

maintenance, repair and transportation and

minor modification work. The concept behind

the structure was to create two major divisions

that mirrored each other. Each center has a Programs Division (provides program management

of various projects) and a Products Division

(manages subsystems common to all versions

of the aircraft and provides systems engineering support). There is also a Business Group,

not duplicated at SPO West, and a Logistics

Support Group.

To support the large FMS work and cooperative

efforts with other countries, International Liaison Officers are assigned to Hill AFB and to

“SPO East.” There are representatives from Belgium, Denmark, The Netherlands, Norway,

Greece, Korea, Israel, Egypt, Japan, Portugal,

Singapore, Taiwan, Thailand, and Venezuela.

The rest of the discussion in this part will center

on the types of work performed by each Group.14

Programs Group

(ASC/YPX and OO-ALC/YPX15)

The Programs Group manages a range of development, test, production, or modification programs for its three customer groups — the

USAF, the European Participating Air Forces

(EPAF), and Foreign Military Sales (FMS) customers. The breakout for work responsibilities

between the two Program Groups is indicated in

Figure 5-7. Normally, SPO East (five branches)

takes the lead on all F-16 new FMS programs.

In the Flight Test Branch, they manage all flight

test processes and resources for USAF, EPAF,

and FMS programs to verify the combat capability of the F-16 weapon system. They also have

management responsibility to work with the

Japanese on the development of the F-2, an F16 derivative. The two “SPO East” International

Branches manage by country teams (each with

five to six personnel per team) as shown in Figure 5-7. At “SPO West” they have responsibility for the logistics planning and sustainment

aspects of USAF and international programs,

although the bulk of their work is in support of

FMS customers. The Logistics Integration

Branch regenerates F-16s from the “boneyard”

at Davis-Monthan Air Force Base near Tucson,

Arizona for refurbishment and sale to international customers. With international interest high

Figure 5-7. SPO East and SPO West Work Responsibilities

SPO East

Acquisition

New Production - Contract Mgt C/D Eng Auth C/D

Software Financial Mgt Test & Eval

SAF/IA & Other CMDS Interfaces Capability MODs

SPO West

Sustainment

A/B Eng Auth A/B/C/D Common Eng Auth

A/B Software R&M MODs Depot Spt

Spares SE Item Mgmt

Program Lead

Egypt Turkey

Taiwan Bahrain

MNFP Greece

Korea Singapore

Program Lead

Jordan Venezuela

Israel Portugal

Thailand Egypt Depot

Turkey Depot Greece Depot
Chapter 5 United States F-16 Program

5-9

in obtaining F-16s, the USAF began in the 1994

timeframe to look at early version F-16 A/Bs

for possible FMS sale. The cost of a regenerated aircraft is about two-thirds of a current production aircraft, and while not as capable as

current designs, it can be refurbished, and it

provides more capability than when originally

built. Since this program started, they have

regenerated 70 aircraft.

Product Group

(ASC/YPV and OO-ALC/YPV)

The Product Group (YPV) is the process and

common systems staff within the SPO. The staff

provides technical definitions of new requirements, systems engineering, manufacturing, and

safety for the aircraft and its subsystems. If an

IPT or Country Team needs systems engineering

expertise, then YPV’s Flight Systems, Sensor

and Systems Engineering branch will provide

personnel to support the effort. They also have

engineering responsibility for the common systems, e.g. engines, ejector seats, and electronic

warfare (EW). This organization, as part of its

technical responsibilities, has oversight of configuration and manufacturing management. It

also manages, along with Ogden, the many minor modification programs, such as the Night

Vision installation in the F-16s. At “SPO East”

is an Acquisition Initiatives Branch that tracks

implementation of acquisition initiatives such

as Reduced Total Ownership Cost (RTOC),

Single Process Initiatives (SPI), Activity Based

Costing (ABC) and Product Support Business

Area (PSBA). The F-16 has been selected as a

“pilot program”16 for several of these. “SPO West”

provides field and depot engineering and technical support for aircraft structures including

mechanical items, and manages embedded software and computers updates to the F-16 for

USAF and FMS customer for all pre-block 40

aircraft. They also review, approve, and distribute

Technical Orders.

Business Group (ASC/YPF, YPK, YPO)

The Business Group as is indicated in Figure

5-6 does not have a counterpart at SPO West, at

least not as a separate function. The Business

Group provides financial and contracting support to the SPO. The Financial Management

Division is the “money manager” for the SPO.

It prepares, with inputs from contractors; the cost

estimates used for FMS sales. It allocates financial resources and maintains funds control for

the SPO. Yearly it spends about $500 million on

the USAF side, but it has overall responsibility

for about $1.5 billion in total money managed.

The FMS side receives and spends yearly about

$500 million to $1 billion in new business. They

also have the responsibility to monitor the

contractor’s program cost and schedule performance, including adherence to the Cost/Schedule Control System Criteria (C/SCSC). One routine financial activity that takes place during the

budget preparation cycle is the “What if?” exercises. Typically a headquarters office will ask

questions like, “If we reduce your program by

$10 million, or if we reduce quantity by 10 percent, what impact does that have on your program?” The Contracting Division awards and

administers F-16 contracts for both FMS and

USAF. At “SPO West” contracting is organized

differently. They provide matrixed support to the

F-16 SPO, as well as to other organizations, such

as the Mature and Aging Aircraft Directorate.

While they do not work directly for the PM, they

do provide about 11.5 man-years of effort to the

SPO West.

Logistics Support Group

(ASC/YPL and OO-ALC/YPL)

The Logistics Support Group is made up of

two sister divisions — one responsible for Acquisition Logistics (SPO East) and the other for

Systems Support activities (SPO West). The Acquisition Logistics Division is responsible for the

management of all Integrated Logistics Support
The Falcon and the Mirage: Managing for Combat Effectiveness

5-10

acquisition functions, including development of

all F-16 support equipment and technical orders.

They are also responsible for warranty management and post-production support planning. The

System Support Division provides daily liaison

with the F-16’s suppliers who collectively provide sustainment for the fleet. They also serve

as the primary support interface between the

HQs Air Force and other commands on issues

impacting readiness of the weapon system. The

Customer Support Branch provides a 24-hour

a day “help desk” or Hotline for technical assistance.17 Their Non-Commissioned Officers

(NCOs) work customer issues and can form a

Crisis Management Team (CMT) to quickly

resolve a customer’s critical technical issue and

send the CMT to a customer’s site.

Other Organizations within AFMC

that Support the F-16

Keeping an aircraft flying and at its peak requires

the work of many people and organizations. No

program office contains all the expertise to keep

an aircraft flying. The logistics and the repair

support for the F-16, as for other aircraft, is a

product of the effort of many different organizations. The F-16 is no different. If one thinks

of one’s car, many specialty companies have

sprung up over the years to provide low cost,

quality maintenance — Jiffy Lube for oil

changes and Midas for muffler replacement are

just two of the examples.

As an example, at Ogden the Logistics Management Directorate (OO-ALC/LG) provides

supply management, through an individual

called the “Supply Chain Manager (SCM).” A

Division within LG has the SCM duties for the

F-16 for buying and transporting spare parts for

maintenance and repairs activities. When the

aircraft is modified, they become a part of the

modification effort to ensure that old parts are

no longer bought and new parts are on the shelf

ready when needed.

 Another Ogden example is the Aircraft Directorate (OO-ALC/LA), which is the depot facility, or industrial facility, where aircraft are flown

in from an operational base to be modified with

the latest changes (such as Night Vision), or for

structural enhancements, or for service life improvements. The examples just mentioned represent only two of several organizations at

Ogden that support the F-16 for landing gear,

wheels, brakes and tires, engine starter systems,

gas turbine engines (GTE), auxiliary power units

(APU), and secondary power units (SPU). Other

air logistics centers (Oklahoma ALC and Warner

Robbins ALC) provide support for items such

as propulsion and automatic test equipment.

Integrated Product Team (IPT)

In the early 1990s a new management concept

was inaugurated within DoD and Air Force

acquisition — the Integrated Product Team. The

IPT was an attempt to replace the traditional

serial approach to staffing actions in order to

decrease decision-making time and to make more

informed decisions. “IPTs are cross-functional

teams (e.g., program management, engineering,

manufacturing, test, logistics, financial management, procurement, and contract administration,

including customers and suppliers) that are

formed for the specific purpose of delivering a

product for an external or internal customer

...and...making the right decision at the right

time....IPT members should have complementary skills and be committed to a common

purpose, performance objectives, and approach

for which they hold themselves mutually

accountable.”18

IPTs play a key role in managing work effort

within the SPO. The IPT is also indicative of

the delegation of authority, a key tenet of the IPT

philosophy, to personnel operating within the

program office. While the composition of an IPT

will vary, the typical FMS IPT (often referred

to as Country Team) consists of membership
Chapter 5 United States F-16 Program

5-11

from the product center, logistics center, contractors, and the buying country. A Security

Assistance Program Manager (SAPM) leads it,

with a typical “core” membership that includes

a systems engineer, logisticians, a financial manager, a contracting officer, and buyer. IPTs are

the focal and often decision point for resolution

of all F-16 issues and problems related to their

specific projects. One final point on IPTs: often

members are matrixed to an IPT, rather than a

permanent part of an IPT team. A “matrixed”

employee is one who joins the team, works with

the team often, but not always to the extent of

sitting in their office space.

There are a variety of other IPTs that mostly

focus on functional or process topics. Some

examples of these IPTs are:

• Environmental IPT – Provides environmental consulting expertise and support to

ensure institutionalization of Pollution

Prevention, and minimizes adverse environmental, safety, and health impact regarding

cost, schedule, and performance.

• Safety IPT – Makes safety integral to all

aspects of design and modification

programs.

• Acquisition Initiatives IPT – Reviews impact and implements various initiatives

such as RTOC, CASMIS19, ABC , SPI, etc.

• Manufacturing IPT – Reduces program

risks by balancing product design process

with contractors manufacturing capabilities. Specific areas include Lean Manufacturing, Product Assurance, and transition

to commercial practices.

• Sensors IPT – Evaluates impact of radar,

electronic warfare, communication, navigation, identification issues and changes.

• Process IPTs – Integrates technical review

of ECPs and modifications and develops

system engineering and software acquisition process.

IPTs generally have a “core” group of personnel that form it. Using the Manufacturing IPT

as an example, it has a core team of eight consisting of a team leader, several industrial engineers, a manufacturing engineer, a quality assurance, and industrial specialist. The team

brings in other experts as necessary to reinforce

the team. The team forms when a specific manufacturing issue arises, such as a Lean Aircraft

Initiative. The initial effort may require the team

to work the problem on a full-time basis. As the

project is completed, the team dissolves, or in

some cases it will continue to work residual

issues on an ad hoc basis. The use of the formal

title IPT is much more a part of the culture of

the F-16 SPO East, than it is at the SPO West.

SPO East uses many IPTs and country teams to

manage projects within the SPO. Ogden tends

to refer to their teams as country teams, funded

by the FMS country rather than by an IPT.

THE PROGRAM MANAGERS20

This section takes a look at the twelve people

who have managed the F-16 SPO over the last

29 years. The first Program Manager was Colonel Lyle W. Cameron, a former prisoner of war

in Korea. He was the first of many who wore

“wings” to become an F-16 Program Manager.

Then, operating with a small program office at

ASD, Colonel Cameron and his successor Colonel Bill Thurman managed the contractor

development of a prototype technology demonstration aircraft and the initial Full Scale Engineering Development of the F-16. As the F-16

moved through its development and up the Air

Force’s priority list, the rank of the Program

Manager also changed. The next Program Manager selected was at the general officer level —
The Falcon and the Mirage: Managing for Combat Effectiveness

5-12

Brigadier General, later Major General, James

A. Abrahamson. As the aircraft entered “midlife”

the general officer position returned to the

Colonel level it was in the early 1990s.

What are some of the attributes of the job and

the characteristics of the personnel that have

managed the F-16? First of all, it has been a good

position for future promotion. All but one Program Manager made general officer, several

moved on to three stars, and one to four stars —

General Ron Yates. The incumbent, Colonel

Mark Shackelford, was recently selected for

promotion to Brigadier General. One of the criteria or traits that seems to go into the selection

process for an F-16 program manager is the need

to have a user perspective — normally a former

pilot. Over the last thirty years, of 12 program

managers, ten have been pilots (nine fighter

pilots and one a C-130 pilot). Only two have

not been pilots — former Colonel, now Lieutenant General Leslie Kenne (maintenance

officer) and Colonel Larry Cooper (navigator).

From an educational perspective all the Program

Managers have had at least a masters degree with

the exception of one, Major General Bob Eaglet,

who has a doctoral degree in Electrical Engineering. Six have been academy graduates, with

two of the earlier PMs being Naval Academy

(Bill Thurman), and West Point (George Monahan) graduates. Others have attended a variety

of schools throughout the nation from large state

schools (University of Nebraska and Auburn)

to private schools such as the Massachusetts

Institute of Technology (MIT), University of

Southern California (USC) and St. Joseph’s

University. All but two have earned either an

undergraduate degree or graduate degree in

“hard science,” such as engineering or physics.

Acquisition experience brought to the F-16 job

by each person has been an average of 10.3

years; Bob Eaglet had over twenty years and Bill

Thurman had the least amount at 5 years.

What types of experience have these military

personnel brought to the job? As indicated above

Figure 5-8. Program Managers

Program Managers Years

Colonel Lyle W. Cameron 1871–1972

Colonel William E. Thurman 1972–1976

Major General James A. Abrahamson 1976–1980

Major General George L. Monahan, Jr. 1980–1983

Major General Ronald W. Yates 1983–1986

Major General Robert D. Eaglet 1986–1989

Brigadier General Ralph H. Graham 1989–1992

Brigadier General Ronald T. Kadish 1992–1993

Colonel Leslie F. Kenne 1993–1994

Colonel Larry H. Cooper 1994–1998

Colonel Jeffrey R. Riemer 1998–2000

Colonel Mark D. Shackelford 2000– Present
Chapter 5 United States F-16 Program

5-13

most have been pilots and bring the perspective

of the operational user to the Program Office.

The Air Force traditional goal to include the user

perspective is well represented, and of course

how could it be better represented than as the

program manager. Acquisition experience included tours as headquarters staff officers, chiefs

of integrated product teams, program directors

of other programs, project managers at test and

evaluation centers, and deputy program managers. The average rank to enter acquisition was

as Major, with six entering acquisition as Lieutenant Colonels. In all cases, coming in at a more

senior level, they moved into management level

jobs. The length of time spent as the F-16 Program Manager has varied from only one year

for Kenne to over four years for Abrahamson,

with the average stay on the job about 2.5 years.

PERSONNEL21

This next section takes a statistical look at the

workforce of the SPO. I have chosen a number

of variables to examine in this section to provide

insight into the characteristics of the personnel

and certain aspects of acquisition personnel

management. First, the number of personnel in

the F-16 program office is 565 personnel — 474

government personnel, consisting of 80 military

and 394 civilians. Also operating as part of the

SPO workforce are 91 support contractors, often

referred to as Advisory & Assistance Support

(A&AS) contractors and 21 foreign national customer representatives. The largest component of

the SPO is at “SPO East” with a total of 330 personnel — composed of 60 military, 197 civilians,

and 73 A&AS contractors. “SPO West” has a

total of 235 personnel, with 20 military, 197 civilians and 18 A&AS contractors. The average

grade is GS-12/Captain.

There are a couple of characteristics worth

noting between SPO East and West. The most

obvious is the use of support contractors, only 7

percent, at SPO West, while in Dayton support

contractors make up almost 22 percent of the

workforce. Second, is the difference in a military presence with significantly more military

personnel working on the acquisition side. Military personnel in Dayton make up 23 percent of

the government acquisition workforce, while at

Ogden they are only 9 percent. The ratio however is still 10 percent less than the military to

civilian ratio for the Air Force acquisition and

technology workforce.

Acquisition Positions

As mentioned in Chapter Two, the DoD created

an Acquisition Workforce and Corps in the early

1990s. Certain government positions were identified either as Acquisition Workforce positions

or as Critical Acquisition Positions (CAP). CAP

positions at the Lieutenant Colonel or GS-14

level are filled with personnel from the acquisition workforce. In the case of the F-16, out of

474 government positions, 273 are acquisition

workforce positions, 27 are CAP positions, and

the balance are non-acquisition positions.

As indicated above most SPO East government

positions are part of the acquisition workforce.

While at SPO West many non-acquisition

Figure 5-9. Acquisition Positions

Total Positions Acquisition Positions CAPs

East 257 240 24

West 217 33 3

Total 474 273 27
The Falcon and the Mirage: Managing for Combat Effectiveness

5-14

positions still perform acquisition functions.

They are considered part of the sustainment

workforce.

Functional Discipline

The personnel working in the program office

represent a range of work disciplines or professions as shown below:

FMS Support

One of the major drivers of SPO activity is FMS

support. Sixty percent of the SPO positions support the FMS Process. Foreign governments,

through FMS accounts, fund these positions.

That equates to approximately 339 of 565 personnel working on FMS slots. At SPO East that

totals 179 positions, while at SPO West 160

positions are funded by FMS.

In FY 2000 the program office went through a

major resizing of the SPO. They reduced the

number of positions from 950 to 494. When

looking at the workload the USAF support has

declined from 470 to 227 personnel. The new

FMS workload has increased the size of the

workforce by an additional 71 positions, to bring

the total workforce to 565 personnel.

Education and Experience

This data is gathered from the respondents to

the survey shown in Appendix D. The total population for the survey was 413 personnel, 70 military, and 343 civilians (Received back 147 responses for a percentage return of 36 percent).

It should be pointed out that all the military

officers will have at least a bachelor’s degree,

with most having a master’s degree.

SPO East

Of the 95 personnel (42 percent of the acquisition population — A&AS contractors not included) who responded to our survey at SPO

East, 4 had high school as their highest degree,

34 had a Bachelors degree, while 55 had a Masters degree. The average amount of acquisition

experience is approximately 15.5 years, with six

having less than two years, and over 50 percent

having over 10 years of acquisition experience.

Figure 5-10. Functional Discipline

Function East West Total

Contracting 39 11.5 50.5

Financial Management 28 12.5 40.5

Program Management 47 3.5 50.5

Logistics 19 78.5 97.5

Science and Engineering 90 22.5 112.5

Test and Evaluation 3 0.5 3.5

Non-Acquisition Corporation

Production/Modification Management 20 20.5

Equipment Management Specialist 31 31.5

Item Management Specialist 23 23.5
Chapter 5 United States F-16 Program

5-15

For acquisition training, 86 had received some

acquisition training with 53 having achieved

Level III. Acquisition level III training is required

for critical acquisition positions (SPO East has

24 CAPs). Thirty-two of the respondents indicated

they were multi-functional qualified with the

achievement of at least Level II certifications

(several had Level III) in other fields.

SPO West

Of the 52 personnel (28 percent of the acquisition population) who responded to our survey

at SPO West, 15 had high school as their highest degree, one had an Associate’s degree at a

junior college, 22 had a Bachelor’s degree, while

14 had Master’s degrees. The average amount

of acquisition experience is approximately 12.3

years, with five having less than two years, and

slightly less than 50 percent having over 10 years

of acquisition experience. Only 47 had received

some acquisition training, and only 12 had

achieved Level III certification. Eleven indicated

they had more than one career field certification.

SPO West has 3 critical acquisition positions.

Training

One of the areas of emphasis for DoD is career

training for the acquisition workforce. Over

$100 million is budgeted annually for their training by the Defense Acquisition University located at Ft. Belvoir, Virginia. Acquisition training refers to career training, distinct from level

of education — such as Bachelor’s or Master’s

degrees. As indicated in Chapter Two, the career training path envisions entry-level training

(for which one receives a Level I certification),

mid career training (Level II certification) and

journeyman training (Level III certification).

This researcher had two questions related strictly

to acquisition training. How well trained is your

workforce? And does it receive yearly adequate

training?

SPO East

Responses from SPO East supervisors indicate

they could get training for their workforce when

they needed it and that the workforce was well

trained. This is borne out by responses to the

survey in which 53 personnel were identified as

Level III certified, in at least one career field,

26 certified at Level II, and 7 certified at the

entry Level I. Additionally, as indicated above,

32 had received certifications in more than one

career field. Besides official career training, the

SPO as part of an ASC effort embarked upon

cross-training efforts, particularly between the

financial management organization (FM) and

the contracting organization (PK). This encouragement of cross-functional training was perceived to be beneficial for broadening personnel. Two areas of concern were identified: (1) a

need for F-16 SPO specific job training and (2)

additional training in several logistics areas —

provisioning, support equipment and technical

orders.

SPO West

At SPO West training needs were seen differently. Those in acquisition-coded positions felt

they were well-trained and that training was

available when needed. However, two problems

were identified. For those not in an acquisitioncoded position, but performing acquisition functions or wishing for career broadening training,

training was hard to obtain. By DoD policy they

receive a low priority for training at DAU

courses. A second problem identified by several respondents related to the level of interest

in training. “Adequacy of training is sufficient,

but proficiency- or broadening-training was not

of much interest to personnel.” The problem was

perceived to be one of an aging workforce with

many personnel not far from retirement and generally not interested, particularly in any careerbroadening training. As was indicated in the

survey, 12 had received Level III certification,
The Falcon and the Mirage: Managing for Combat Effectiveness

5-16

23 had achieved Level II, and 12 had achieved

Level I. Eleven had additional career field

certifications.

Personnel Turnover

How often do personnel move, or said differently, what is the turnover rate of the Program

Office? A typical complaint of managers and

personnel relates to the movement of personnel

since it often negatively affects the management

of a program. Every time a new “boss” comes

in with a new agenda, it is typical for change to

occur in an organization — reorganizing, retraining, establishing new initiatives, and instituting

new program direction. Also as personnel

change, most often experience level decreases.

In discussions with senior personnel from the

SPO, turnover is no more different from what

one would expect at any other program office.

In the case of the military, it is typical to stay on

the job approximately 2–3 years. In an early

study by the IDA23 of the F-16 and other programs significant upper-level management

movement was found in the 1980s. More recently PMs have rotated more rapidly than in

the past, with the last five program managers

staying on the job slightly longer than 2 years.

A review of other senior personnel in YP —

directors, division and branch chiefs — indicates

significant stability at SPO West, with most of

the civilian senior leaders having worked in the

SPO for five or more years. At SPO East, at the

Group level, all senior managers have been in

the program office less than three years. While

at the branch level more stability is seen, with

six of the managers having tenure over five

years. Over 50 percent of the SPO managers

came to their jobs since 1999.

SPO East

The SPO East turnover rate was from low to

moderate with two exceptions. The main driver

appeared to be career-broadening opportunities

for personnel in contracting and financial management. While this in the long term will provide more capable personnel from a program

perspective, it impacts F-16 knowledge and

experience. Thus both FM and PK indicated significant change within the last five years (perhaps as high as 20 percent turnover yearly in

the contracting division) that indicated only five

of 35 professional contracting personnel remain.

SPO West

The SPO West turnover rate was identified as

low. The main reason for turnover was identified as career management changes to provide

personnel growth. Looking over a five-year

period, the turnover rate is slightly higher —

low to moderate, averaging about 10-15 percent.

Data obtained on the length of time personnel

have spent in the program office seem to bear

out this finding with the exception of calendar

year 2000 when 25 percent personnel turnover

was witnessed. The only area mentioned as a

problem was at another organization — the

Technology and Industry Support Directorate,

OO-ALC/TI organization—which had trouble

retaining software writers. With many of our systems still using older languages — Jovial — it

was difficult to attract and retain software writers

to support SPO updates.

MANAGEMENT PRACTICES

This section attempts to look at the way the F16 manages its work. What do I mean by management practices? Generally I mean the way

we organize, process, delegate, lead, control,

activate, and respond to outside sources (customers, bosses). We have already discussed the

organizational structure, which gives us clues

for other areas we want to consider. As indicated

above, work performed in the SPO is of two

general types — acquisition and sustainment.

For the United States, the development and main
Chapter 5 United States F-16 Program

5-17

production runs of the F-16 all occurred in the

1970s and 80s. The production line has been kept

open for new aircraft — primarily for FMS buys.

However, the United States still buys small quantities of F-16s, usually by Congressional Direction. As an example, the Fiscal Year 2001

Defense Appropriations Acts required the Air

Force to buy four additional F-16s. So while

acquisition continues and new developed items

are added to the F-16, much of the work falls

under the sustainment umbrella.

Eight functions are represented by work performed in the F-16, plus FMS support. The categories are:24 Financial Management, Logistics

(Acquisition Logistics), Manufacturing, Quality Assurance, Contracting, Program Management, Engineering, and Test & Evaluation. These

functions also relate to the way the acquisition

workforce is organized, as shown in Chapter

Two. Thus it makes sense to analyze the types

of work performed by function, since people

tend to see themselves as part of a functional

group and their career-path training is aligned

by functions. These activities take place regardless of whether the work is performed for the

USAF or for an FMS customer. The following

chart provides a general breakout of some of

the activities that take place within each function

(for a more detailed list see Appendix C).

Within each function are processes and procedures for managing work and for contributing

to the acquisition or sustainment of a product.

The way these all come together in the SPO, at

least for a specific project, is through an IPT, or

country team.

Program Management – Integration of Program Activities, Program Strategies, Program

Reviews, Workforce and Organization Shaping, Contractor Oversight.

Contracting – Acquisition Strategy, Market Research, Negotiation, Evaluation of

Proposals, Contract Preparation, Award and Administration, Modification of

Contracts/Award Fee administration, yearly options.

Engineering/Quality/Manufacturing – Specification preparation/approval, design

reviews, contractor oversight, Statement of Work reviews, configuration

management, audits, Quality Oversight of contractor, contractor’s procedures,

review of contractor preparation for production.

Financial Management – Preparation of the program budgets, management of internal

financial resources, schedules, financial forecasts, review of the Contractor

program financial status.

Acquisition Logistics/Logistics Support – Supply support preparation, initial

provisioning, development of test equipment, reliability/maintainability

assessments, authorize technical orders, equipment management, item

management.

Testing – Test and Evaluation Planning, preparation and review of test plan.

Foreign Military Sales Support –

Figure 5-11. SPO Tasks Performed
The Falcon and the Mirage: Managing for Combat Effectiveness

5-18

Decision Making

What types of decisions are made in a program

office? Who makes them? What type of decisions does the PM delegate to his staff? What

are the senior levels a Program Office must go

to for approval? How often do they need to go

to senior levels? These are some of the questions this section will attempt to answer. As a

general management philosophy, as indicated in

Chapter Two, DoD generally sees its higher

headquarters offices as policy setters, with

authority delegated to the lowest appropriate

level to carry out the work. We indicated earlier

that there are several chains of command —

acquisition, sustainment (IWSM), and command. Program approvals for the F-16 run

through the acquisition chain.

The Program Director receives his formal

direction through a document prepared within

the Air Force at the SAF/AQ level called a Program Management Directive (PMD). This document lays out the development, production,

deployment schedule, systems support, and

modification for the USAF work effort. The

current PMD is 6075 (80)/0207133F and was

issued in August 1997, but is updated as necessary. For Foreign Military Sales, direction comes

from a document called a Letter of Offer and

Acceptance (LOA), signed between the United

States Government and a foreign nation.

Senior leaders conduct a variety of official

reviews to check the status of projects within

the SPO (see Figure 5-11). Since it is designated

an ACAT II Major Program, the DoD Directive

does not require any specific reporting activities. The Program Manager does generate a variety of reports, one of which — the Monthly

Acquisition Report (MAR) — is sent to both

SAF/AQ and PEO/FB. This is the most frequently generated report. A two-page status

report, it highlights top-level issues on the program to the leadership. Annually, the PEO/FB

Combined Portfolio Review (CPR) is held with

SAF/AQ and AFMC/CC in which the F16 is one

of several programs briefed. The Chief of Staff

of the Air Force (CSAF) is briefed annually on

the readiness status of the F-16.

Several business events can trigger the SPO to

go to higher headquarters for approval prior to

taking an action. Not withstanding the receipt

of the PMD, prior approval is required for an

acquisition strategy for a buy above $50 million. The approval level is either the PEO or the

SAE (see Figure 5-12). Two other actions require

approval outside of the program office — award

of a sole source contract and approval of the

Figure 5-12. F-16 Reporting Requirements and Related Activities

• Annual

– SAF/AQ & AFMC/CC Combined Portfolio Review (CPR)

– CSAF Quarterly Acquisition Program Review

• Monthly

– Monthly Acquisition Report to SAF/AQ and AFPEO/FB

– Division Level Program Management Reviews with Contractors

• Bi-Weekly

– SPO Telecon with Lockheed Martin Aero
Chapter 5 United States F-16 Program

5-19

Request for Proposal (RFP). See the contracting

section for specific approval requirements.

Within the F-16 SPO

The current Program Manager generally has a

“hands-off” approach to management. He will

review key documents such as the Single

Acquisition Management Plan (SAMP) and the

Test and Evaluation Master Plan (TEMP)

primarily for macro level, politically sensitive

issues. This general approach flows throughout

both SPOs — East and West. At the Division

level, weekly and monthly reviews are conducted with program management personnel to

ensure that schedules and obligation rates are

being executed as planned. Customer satisfaction is used as a major guideline of how successful the organization is performing its mission. Note that the SPO is required to go to

higher headquarters for approval. While this

does not happen frequently, the issue of using

expired funds requires approval of the Air Force

Comptroller. One other politically sensitive area

requiring higher-level approval is the selection

of the Source of Repair Decision (SORAP) for

a new inventory item. Because of Congressional

requirements to maintain at least 50 percent of

the repair work in-house at one of the Depots,

the SORAP decision must go to Headquarters

AFMC for approval.

The F-16 program management approach relies

upon openness and shared communication and

data as key tenets of management. The IPTs or

Country teams have been delegated specific

responsibility for a program, or project, and as

long as they stay within cost, schedule, and performance guidelines, they have significant

authority to perform their work. Each IPT tracks

its contractor’s progress.

Keeping on schedule and within cost goals and

achieving the performance of new improvements

is important. But the SPO also has the responsibility as the “single manager” for the health and

well being of the F-16 fleet. What measurement

criteria do they use to determine that? And more

importantly, how well do they perform the job?

This is a key question for any organization. The

F-16 SPO and the Air Force uses a variety of

measures to determine the well-being of their

fleet of aircraft. The key aircraft measurements

look at the ability of an aircraft to perform at

least one of its missions (Mission Capable (MC).

For the F-16 the operational air force wants to

achieve a minimum fleet rate of 77.2 percent.

Other measurements focus on the source of the

problem — supply problems or awaiting maintenance action. One other key area to consider

is the cannibalization rate (i.e., how many spare

parts are “raided” from one aircraft to get

another one airborne?). A high cannibalization

rate often indicates supply problems, but also

increases the cost of maintenance, for example,

by having to remove an engine from one aircraft for use by another. In recent years the F-16

has had problems achieving its mission-capable

rates often due to the lack of spare parts.

Figure 5-13. Program Approvals

Approval Authority $ Threshold

PM (ASC/YP) < $50M

AFPEO/FB > $50M to < $50 M

PDASA (A&M) > $500M
The Falcon and the Mirage: Managing for Combat Effectiveness

5-20

I have one final comment on the decisionmaking process within the program office. For

development, integration and production

projects that involve the European Participating

Governments — Belgium, Denmark, The Netherlands, Norway and recently-included Portugal — they are treated as part of the program

office and become a part of the decision-making

process.

F-16 Reform Initiatives

Over the last decade, the United States was

embarked upon a period of acquisition reform.

Out of this effort emerged changes in laws,

changes in policies and regulations, and a variety of initiatives aimed at improving the process and lowering the costs of buying and maintaining equipment. Of all these initiatives, several have had a distinct impact on the F-16. They

are Reduced Total Ownership Cost (RTOC),

Single Process Initiatives (SPI), Activity Based

Costing (ABC), Product Support Business Area

(PSBA), and the Air Force’s Lightning Bolts.

For these initiatives, specifically RTOC, SPI and

ABC, the F-16 program office was selected to

participate as a “Pilot Program” to test the

effectiveness of implementing the initiative.

Another series of initiatives the Air Force unleashed in 1995 were called “Lightning Bolts.”

Of the seven Lightning Bolt initiatives,25 one

focused on creating a new, leaner program office.

This resulted in a significant restructuring of the

Program office to comply with the requirement

to significantly cut back the overhead of managing programs. They resized the SPO from 950

personnel to 494 personnel in 1999. When this

is evaluated by the breakout of work between

the USAF and FMS work, the following changes

occurred — the USAF reduced from 470 to 227,

while FMS was reduced from 480 to 316. The

size of the SPO is now 565 personnel.26 The basic

thrust of all the changes was to become more

“commercial like.” Thus the department went

from significant reliance on military specifications to use of commercial specifications. This

included a Statement of Objectives — stating

our needs, not detailed requirements, and asking industry for their best ideas. The SPO also

recognized on its own the need to cut down the

amount of time to get “on contract.” An initiative called Span Time to Acquisition Reduction,

or STAR, was implemented to speed up the

process of awarding contracts. To track these

initiatives the SPO created a separate division

called YPVB with seven personnel.

Foreign Military Sales (FMS)

The F-16 is the Air Force’s largest Foreign Military Sales procurement program with over 4000

aircraft produced through calendar year 2000.

FMS is a part of the security assistance program

of the United States in which foreign nations

buy military equipment, supplies, training, and

services from DoD. The F-16, which began as a

multinational cooperative development and production program between the United States and

the EPG, has evolved over time to be a major

player in the FMS process with significant international interest in buying F-16s. Figure 5-

13 shows the nations that fly the F-16. It is of

Figure 5-14. Aircraft Performance Measures

Mission Capability (MC)

Total Not Mission Capable for Supply Rate (TNMCS)

Total Not Mission Capable for Maintenance (TNMCM)

Cannibalization Rates (Cann Rates)
Chapter 5 United States F-16 Program

5-21

interest to note that the newest buy of the most

modern F-16 by the United Arab Emirates

(UAE) is a Direct Commercial Sale, which

means normally the SPO would not be involved

in the management and contracting for the program. However, because of the technology

involved in the Block 60 program, a Memorandum of Understanding was signed with the UAE

for SPO involvement.

While FMS work is performed throughout the

SPOs East and West, these Program Groups provide the program management for FMS. Other

groups such as the Product and Business group

provide support to the country teams on a

matrixed basis, as needed. FMS is a non-appropriated funds program; personnel are paid out

of a separate FMS account. Currently, that

equates to 360 of 585 personnel.

Configuration Updates

In 1978, I bought a Ford Thunderbird, sleek, sort

of sporty. It had the latest everything — four

whitewall tires, 8-track stereo, analog clock, and

lots of “get-up-and-go.” After six years, it limped

onto a car dealer lot, where using my best negotiation tactics, I convinced the dealer to sell me

a new car and please take my old one in trade.

The first F-16s were delivered in 1978 and while

many of the early version A/B models are in

mothballs at Davis Monthan, many are still flying. The C/D models will probably be around

for another twenty years. Old airplanes, like old

cars, suffer aging problems, but the difference

is that Air Force maintains them. Also, as technology in cars has changed, so has the technology used in aircraft. New cars have more aerodynamic designs, new technology such as Global

Figure 5-15. Countries Flying the F-16

Denmark

Greece

Japan

Egypt

Bahrain

Jordan

South Korea

Taiwan

Turkey

Israel Thailand

Belgium

The Netherlands

USA

Norway

F-16

Fighting Falcon

Singapore Venezuela

Portugal
The Falcon and the Mirage: Managing for Combat Effectiveness

5-22

Positioning Systems (GPS), and many digital

devices — such as clocks that actually work.27

A military aircraft in this era of tight budgets is

flown for many years beyond its normal life

cycle. Besides normal maintenance, as the aircraft ages, structural problems caused by cracks

in metal, rust, and other aging issues require

additional corrective action. As technology and

threats change, it is necessary to provide updates

to aircraft to maintain or enhance their capability.

This is an ever-changing environment. While the

F-16 program office may develop the new capability they will be tasked with incorporating

updates into the aircraft.

As we indicated earlier the F-16 uses a “block”

process to identify and manage aircraft. Figure

5-1628 indicates the capability currently being

added to each block of aircraft. The SPO approaches the updates to the aircraft in a planned

methodology. How does the process work? As

an example a country, such as Singapore, will

ask for a new capability. The SPO will ask the

contractor for a Rough Order of Magnitude

(ROM) estimate. Then the SPO task the contractor, LM Aero with an Advanced Change

Study Notice (ACSN) that includes the Statement of Objectives and a requirements checklist. The SPO’s country IPT, including the contractor and the Senior National Representative

will have jointly prepared the ACSN. This is

signed out by the Contracting Officer to LM

Aero. In the next step, the contractor, jointly with

the program office, prepares the technical

portion of the Engineering Change Proposal

(ECP).

The ECP is submitted to the SPO 72 days later

and then is coordinated inside and outside of

the SPO.29 Fifteen days after receipt of the ECP,

it is submitted to the Board, which usually

approves it. After approval, again jointly, they

prepare the cost proposal. Once submitted, it

goes to the Contracting Division (YPK) for its

business clearance requirements and then to

negotiations to resolve the final price and incorporation on contract. Once that is done, the IPT

monitors the contractor’s efforts until the task

is completed.

With all the configurations of the F-16 and the

complexity of the aircraft itself, the SPO uses

two boards to manage configuration changes to

Figure 5-16. F-16 Models and FY 2000 Upgrade Plans

Mission Description FY00 Program Content

• Block 10/15 Service Life Extension Program (SLEP)

– 147 A/C

– Air Defense Fighter

• Block 25/30/32 Add GPS, Night Vision, CMS, PATS, OFPs,

– 619 A/C Falcon Up/SLIP and other modifications

Close Air Support (CAS)/Interdiction

• Block 40/42 CCIP (LINK 16, MMC, CCMFD, JHMCS), IDM,

– 415 A/C DTS, NVIS, Smart Weapons, Counter

– Interdiction/CAS Measures, OFPs, CCIP (LINK 16, MMC,

JHMCS, AAI), DTS, NVIS, Smart Weapons,

• Block 50/52 Counter Measures, OFPs

– 236 A/C

– SEAD/Interdiction
Chapter 5 United States F-16 Program

5-23

the aircraft. They are the Joint Multi-national

Configuration Control Team (JMCCT) for the

majority of changes and the Joint Multi-National

Configuration Control Board (JMCCB) for

flight safety and for proposals that cannot be

resolved by the JMCCT. The government and

the contractor, LM Aero, jointly chair both

boards. LM Aero performs the actual work of

maintaining configuration control of the aircraft

(drawings, specifications, etc.) and its subsystems. The main functions of this board are

to evaluate recommended changes and ECPs,

and then authorize the change.

The SPO makes several efforts — one of which

is shown above as the Common Configuration

Implementation Program (CCIP) — to group

similar ECPs to take advantage of the opportunity to incorporate them at the same time for

efficiency and cost savings. Below is a breakout

of the number of ECPs and Contract Change

proposals over a five-year period approved by

the Board and incorporated on contract. They

are ranked by their complexity with a low complexity rating, for a simple change such as a part

number change, to high complexity for a totally

new capability.30

Outside Influence

In interviews with program office personnel, one

of the striking features was the “lack of highlevel attention” and the impact on work activity

in the SPO from senior levels of the government.

Since the F-16 was operational and has been

operational for 20 years, it does not generate

the same level of interest from Congress,

OSD, and the Service headquarters that a new

developmental aircraft such as the F-22 receives.

The reason for this question is the common complaint of personnel in the acquisition community of the impact of extra work generated by

headquarters and congressional tasking. In my

Figure 5-17. ECPs and Contract Change Proposals (1996–2000)

1996 1997 1998 1999 2000

Engineering Change Proposals

Completxity

High 96537

Slightly above 11 9 5 18 3

Average 5 8 18 2 4

Slightly below 9 20 15 15 10

Low 58 41 44 8 3

Total Approved 92 84 87 46 27

Contract Change Proposals

Complexity

High 76821

Slightly above 15 11 9 4 6

Average 10 13 7 5 3

Slightly below 14 12 6 1 2

Low 10 10 6 1 1

Total Approved 56 52 36 13 13
The Falcon and the Mirage: Managing for Combat Effectiveness

5-24

interviews with senior managers at both SPO

East and West, the workload impact from Congress, OSD, and AFMC was generally adjudged

to be minimal. Headquarters Air Force, on three

primary issues, was seen as contributing moderately to the workload of the SPO; the three

areas were from SAF/IA, because of technology transfer issues, SAF/FM for “what if” exercises and budgetary issues, and SAF/AQ for

acquisition initiatives. From the local Acquisition organization, ASC and OO-ALC, impact

on their work was judged low to moderate. One

of the interviewees perhaps captured the local

impact issues when asked about the impact of

the local headquarters responding, “very little

(currently), but sometime that varies depending

upon the personality of the individual holding

these jobs. Some are micro-managers who get

heavily involved into what goes on, while others

are top managers who provide a lot of leeway.”

Management responsibility is retained within the

Air Force and within the PEO chain. Thus most

of the high level impact is probably indirect

through policy and regulatory changes. Individual organizations do drive some additional

work for reviews of initiatives within AFMC for

aging aircraft, common systems, and others such

as Operational Safety, Suitability, and Effectiveness (OSS&E). Local organizations, such as

ASC and OO-ALC, have a greater level of involvement since they actually provide people

and processes and often “tap” them for reviews

of local initiatives. Congressional notifications

for contract awards and new F-16 buys were the

primary political items identified as impacting

the SPO. For example, in the FY01 appropriations act, Congress directed the Air Force to buy

4 new aircraft and to plan for modernization of

Air National Guard (ANG31) units that have F16A aircraft assigned. In some cases during the

interviews, some organizations were identified

as the “guilty parties” for new work, when in

reality it was other organizations.

Business Arrangements

Two different contracting organizations support

the program office. At SPO East they currently

have about 40 active contracts, with 4 prime

contractors. The four primes are LM Aero (aircraft), Northrup-Grumman (radar), Sargent

Fletcher Company (auxiliary mission equipment), and Luminescent System Inc (Night

Vision Goggles). Since 1975 the primary F-16

contracting work has been done “all sole source”

to LM Aero, using both firm fixed-price and cost

reimbursement contracts.32 They have 14 warranted contracting officers who are authorized

to award or modify contracts and direct the contractor.33 Last year in FY 2000, they issued eight

new contracts and processed 268 changes to

existing contracts. The SPO’s contract activity

— new contracts, modifications to existing

contracts, and the dollar value of all contract

actions — over the last three years can be seen

in Figure 5-16 for both FMS and USAF efforts.

The large increase in money spent in FY 2000

reflects two major FMS buys of $1.3 billion

each. The normal business strategy employed

Figure 5-18. F-16 SPO East Contracts Activity

Fiscal Year

1998 1999 2000

New Contracts Actions 9 10 8

Modifications 441 343 262

Dollar Value $ 629M $ 852M $ 3.3B
Chapter 5 United States F-16 Program

5-25

by the SPO is to issue a new contract for each

new FMS buy. For a U.S. buy, the existing LM

Aero contract is modified to incorporate the new

acquisition. They also regularly make use of

Government Furnished Equipment provided

typically by a logistics center to help reduce the

cost of the system.

At SPO West, contracting is provided as

matrixed support not only for the F-16 SPO, but

for other organizations that support the F-16 aircraft, such as the Logistics Management Directorate, which provide the spare parts for repair

and modification of the F-16 aircraft. They have

51 separate contracts, for a total face value of

slightly more than $1 billion, and spend approximately $275 million yearly. Fifteen of these contracts are with LM Aero, all sole source. The

LM Aero share of yearly spending average about

$96 million. Only five contracts are competitive and the largest one of those is for $5 million.34 In FY 2000 they issued a total of 214

modifications, plus 504 delivery orders.35

One final area that needs to be mentioned is

the role played by the Defense Contract Administration Agency. This organization, located at

the contractor’s plant in Fort Worth, Texas, has

the responsibility for administering the contracts

for the program office. Typical duties include

reviewing contractor proposals, administrative

systems, advising the program office on schedule and technical difficulties, and making

payments.

SUMMARY

The locus of management activity for the acquisition (new buys and changes) and sustainment

(logistics support) of the F-16 is the SPO. The

program office exists in a very complex management environment. It is part of a very large

organization, geographically dispersed, operating within a set of overlapping management

structures (PEO, AFMC, IWSM, and IPT). Even

internally it is large; and perhaps reflecting the

competing interest of various players, it is

geographically separate, reporting up several

chains of commands. The Program Manager

(and Single Manager) is also responsible for the

readiness of the aircraft fleet for peacetime and

combat. This adds a large group of customers

with concerns about their ability to perform their

missions, and it provides a management environment where it is necessary to respond to the

conflicting demands of all parties. As part of a

large, dispersed organization the senior levels

of management (Congress, OSD, and Service

Headquarters) provide a more formal set of rules

and regulations to govern the activity of its

personnel.

Decision making is relatively formalized, with

several yearly briefings to high-level commanders, plus a variety of monthly meetings with

senior-level managers and contractors, primarily LM Aero. For acquisition strategies and contracts for major efforts, the SPO is required to

go to higher-level authorities for approval,

mostly at the SAF/AQ level in Washington, D.C.

The program office operates more informally

with internal reviews at the division level, but

expects project leaders to bring to senior managers significant problems or breaches of approved baselines. The IPT (including country

teams) management technique plays a key role

in the work structure within the SPO. It is used

for product (F-16 C/Ds), or country purposes,

but also provides the means to address technical and management issues. The IPT also provides the customer a focal point for issues and

concerns.

The selection of the key individual to manage

this effort reflects the Air Force desire for a PM

with primarily an operational and management

background, but inculcated with a certain measure of acquisition experience. In this case the

F-16 PMs bring, on average, over a decade of
The Falcon and the Mirage: Managing for Combat Effectiveness

5-26

acquisition experience. An array of military,

civilian, and support contractor (acquisition and

non-acquisition) personnel provides the technical and business skills necessary to run the program office. Educating and training of government personnel is very structured and a training

and experience career path is laid out in a series

of DoD and Service regulations. And finally, as

USAF work has diminished over the years, FMS

has become the backbone of SPO work, with

FMS making up almost 60 percent of the work

performed by the program office.
Chapter 5 United States F-16 Program

5-27

ENDNOTES

8. Air Force Materiel Command was formed

in July 1992 with the merger of Air Force

System Command (AFSC) and the Air

Force Logistics Command (AFLC).

9. Recently the ASC Commander was titularly

identified as responsible for sustainment of

all aircraft, although since he does not actually control any of the resources for sustainment, it is uncertain as to how this policy

will be implemented.

10. Recently nominated to Congress for the

rank of Brigadier General.

11. Acquisition is a broadly-used term that refers in its narrowest sense to the research,

development, and production of systems.

In its broadest sense it also includes the testing, the modification, the logistics support,

and disposal of weapons and other equipment. Many other countries use the term

procurement, or armaments development in

lieu of acquisition.

12. Sustainment refers to the classic logistics

disciplines of Supply, Maintenance, and

Transportation, more commonly termed

logistics support to the systems — supplies,

spare parts, and maintenance.

13. SSM is an IWSM term—The SSM is the

lead individual at a Logistics Center who

is delegated sustainment responsibility for

a system or product. The SSM reports directly to the SM.

14. For a complete description of the work of

each division, see Appendix C.

1. In Korea, for a variety of reasons, the U.S.

shot down ten of their aircraft for every one

lost by the U.S. In Vietnam the early exchange rates was 1 for 1. The introduction

of more F-4s later in the war helped

improve the exchange rate.

2. Dorfer, Ingemar, Arms Deal: The Selling

of the F-16, Praeger, New York, 1983, pg. 9.

3. Dorfer, pg. 14.

4. Over the years the term for the development phase has changed — Full Scale Engineering Development, Full Scale Development, Engineering and Manufacturing

Development and its current term, the Systems Acquisition and Production and Deployment Phase, which includes the Systems Integration, System Demonstration,

Low Rate Initial Production and Full Rate

Production and Deployment work efforts.

5. Current price for an F-16C/D model is $20

million plus per aircraft.

6. At that time the company producing the F16 was General Dynamics. The Fort Worth

aircraft division was sold to Lockheed in

the 1990s. This facility was then known as

Lockheed-Martin Tactical Aircraft Systems, LMTAS. Following a recent Lockheed Martin reorganization, this facility is

now part of the Lockheed Martin Aeronautics Company, specifically Lockheed Martin Aeronautics Company-Fort Worth (LM

Aero-Ft. Worth).

7. For a detailed explanation of the MSIP

effort see Frank Camm’s study on risk

management.
The Falcon and the Mirage: Managing for Combat Effectiveness

5-28

15. It is traditional in the U.S. military to refer

to offices by their program office symbol,

such as YP, YPX, etc.

16. An organization is often selected to test (or

pilot) new policies or procedures prior to

Air Force-wide implementation.

17. Note: The SPO focal point for customer

support is at SPO west under YPL. The SPO

East Customer Support Group functionally

works for the SPO West focal points.

18. See Navy website http://www.acq-ref.navy.

mil/ipt/html/map.htm on IPTs.

19. CASMIS is an ASC contracting system

Contract Administration Support Management Information Systems.

20. In the Air Force Program Manager of major air force programs are referred to as Program Directors. For this publication the

term PM will be used to avoid confusion.

21. All personnel numbers are as of 22 March

2001 and provided by ASC/YPO, Ms Lisa

Shannon.

22. A non-acquisition position would include

secretaries, administrative personnel,

equipment specialist, inventory managers

and others. In some cases they may actually perform acquisition work for a portion

of their jobs, but not enough to justify being

included in the Corps.

23. Camm, Frank, “The F-16 Multinational

Staged Improvement Program: A Case

Study of Risk Assessment and Risk Management,” A Rand Study, 1993.

24. Auditing, Industrial/Property Management,

Intelligence Support, Security.

25. The seven Lightning Bolts made the following changes: created a centralized

Request For Proposal support team, created

a standing Acquisition Strategy Panel,

developed a new SPO Manpower Model,

eliminated center level acquisition policies,

reinvented the Air Force System Acquisition Review Council, enhanced the role of

past performance in source selections, and

replaced the many required plans and documents with the Single Acquisition Management Plan.

26. As of May 2001.

27. For those too young to remember, it was a

popular complaint that the old analog

clocks rarely worked much past the drive

from the dealership to the home.

28. The acronyms are: CCIP (Common Configuration Implementation Program), CMS

(Combat Management System), MMC

(Modular Mission Computer), PATS (Precision Attack Targeting System), DTS

(Digital Test Station), NVIS (Night Vision

Imaging System) JHMCS (Joint Helmet -

Mounted Cueing System), OFP (Operational Flight Program), GPS (Global Positioning System), AAI (Air-to-Air Interrogator) and SLIP (Service Life Improvement

Program.

29. Same process for either USAF or FMS

customers.

30. Data provided by Ms Teresa Watson, ASC/

YPVE.
Chapter 5 United States F-16 Program

5-29

31. The motto of the National Guard is “Civilian in Peace, Soldier in War, I Am the

Guard” captures the role of the Air National

Guard. They work for the individual states

during peacetime, and for the national government in war. They are citizen soldiers.

32. The last source selection was in 1997.

33. These individuals are selected because of

technical competence. In the U.S. system,

the contracting officer is the only person

that can direct, through the contract, the

activities of the contractor. Prior to awarding a contract, contracting officers are

required to receive approval to begin

negotiation and to award a contract.

34. They conduct on average about two source

selections
The Falcon and the Mirage: Managing for Combat Effectiveness

5-30
Chapter 6 A Contrast of Program Management

6-1

Chapter 6

A CONTRAST OF

PROGRAM MANAGEMENT

— all dedicated to spreading the IPT concept.

An organizational structure was created with a

hierarchy of IPTs. The lowest level IPT was the

program office IPT (where the original concept

started). Then DoD created Integrating IPTs,

Working IPTs, and Overarching IPTs, all to help

the normal management structure manage. It

was humorously observed around the Pentagon

that the answer to ALL problems was an IPT.

One individual remarked, as a source of pride,

that he was a member of 54 separate IPTs.

France in contrast, under the leaderships of

DGA’s Yves Helmer, also adopted the IPT technique on a much smaller scale. IPTs were created

at the program office level to improve communication with its customers (the military services) and for program office activities, such as

preparation of a Request for Proposal. Shortterm training courses were initiated to help teams

get started, and once started, to operate effectively. It served as a tool rather than as an end

itself.

This chapter provides a comparison of the management environment and the business practices

of the F-16 and the Mirage 2000 program

offices. The prior chapters have provided a separate understanding of how each program office

operates and the milieu within which they operate. This chapter also provides a comparison to

foster mutual understanding of how each, in different ways, addresses its complex task. While

there is a general standard used for program

management in both countries — achievement

of cost, schedule and technical goals — each

country goes about it in different ways.

Two contrasting images emerge between France

and the United States.

Size! The Grand Canyon in Arizona, the rolling

plains across the heartland of America, and the

Great Lakes on the northern border! Paris with

its centuries-old buildings and grand boulevards!

The Eiffel Tower! The Arc d’Triomphe!

Cultural differences! The wild, wild West, surfing in California, or singing “Jimmy Buffet

songs” on a beach in the Keys! Small Parisian

cafes, listening to the expressive voice of the

“Parisian Sparrow Edith Piaf, long vacations,

and wine and cheese!

In the early 1990s, the F-22 aircraft program

office staff (under the leadership of then Colonel Jim Fain) adopted and became the disciples

of a new concept borrowed from American industry — the Integrated Product Team. The

implementation of this concept by DoD and the

DGA captures the difference in management

styles between the two organizations. The IPT

philosophy was to have the right people with

the right authority formed into a team to work

an issue or manage a program. The result would

be enhanced communication, reduced cost,

improved customer satisfaction, and so on. From

within the Air Force, this concept spread to other

organizations. Embarked upon an effort of

“Acquisition Reform,” DoD adopted the IPT as

a centerpiece of it efforts to reform the acquisition system. It was formalized into regulations,

articles appeared in DoD publications, DoD

websites (including the IPT College) were created
The Falcon and the Mirage: Managing for Combat Effectiveness

6-2

Politics and Armament Acquisition

“Were we directed from Washington when to

sow and when to reap, we should soon want

bread,”1 said Thomas Jefferson as a warning

about the centralization of government. His

warning captures the American historical tradition — a tradition and a deep-seated value still

held dearly by many Americans today.

Congress’s active participation in the acquisition process is part of the design of the creators

of the constitution. They not only provide the

money, as the French Parliament does, but they

stipulate conditions conduct additional aircraft

tests, or change equipment needs — adding or

deleting aircraft. This contrasts sharply with the

lack of parliamentary involvement in France.

Under the 5th Republic’s Constitution, Parliament is unable to even initiate legislation on

defense matters. France also has a tradition of a

strong central government. All schools, from

elementary to university, are part of the national

system of education in France. In contrast, in

the United States, it is the right and a responsibility of local governments — State, County, and

City — to determine what is taught and to fund

the education of its students. While strong executive control on defense matters may reduce the

turmoil between the legislative and executive

branches in France, it does not mean that

Defense gets what it wants. Competing interests within the Administration — social versus

defense — under both conservative and socialist

governments — have often left Defense short.

Besides the money spent on defense, Defense

often creates advanced technology that translates

into future jobs. In other words, it also satisfies

an economic purpose. Both countries see the

economic impact of defense. The U.S. Congress

is famous for its support of programs with a view

to what is manufactured within “my district.” It

customarily views the production of military

equipment as something that should be produced

on American soil. France considers its defense

industry as an important component of its worldwide leadership and an important part of its technological and business interests. Thus issues of

offsets on cooperative programs and future sales

play a serious role in their decision processes.

The relationship between government and industry provides a striking difference between the

two countries. This long-standing tradition,

dating from the times of Louis IV and his Minister Colbert,2

 ensures the State is heavily involved in the affairs of its people. The precise

distinction between public and private sectors

in the United States does not exist in France.

Thus the French State has owned companies and

identified “national champions” such as Dassault

for Aircraft. Paraphrasing a famous quote on

war, “Production is too serious a business to be

left to industry,”3

 captures French thought on the

government’s relationship to industry. Despite

the theoretical difference, no one would doubt

that the U.S. Department of Defense plays a significant role in regulating defense industry, and

mandating its accounting rules and regulations

and manufacturing methods (although this is

changing somewhat).

The French armaments approach can no longer

be looked at as strictly internal to the country.

The “Europeanization formula” now addresses

the previously sacrosanct issue of defense and

the defense industry. This has two effects on the

French nation and its defense industry. Management of cooperative programs, and these will

often be major programs, will take place in

OCCAR (an EU entity). With the July 2000 signing of a framework agreement, nations have

given a green light to European industrial consolidation across national lines. While still many

issues remain to be worked, such as the French

government’s ownership and potential involvement in company actions, the political equation

has changed.
Chapter 6 A Contrast of Program Management

6-3

Breadth of Defense Activities

A variety of factors need to be examined when

comparing these two countries in the defense

arena — the scale and breadth of defense

activities, defense industry (breadth of product

areas, size of programs), and armament sales.

The United States, in pure money and manpower

terms, puts the most into defense. The United

States still spends the largest amount for its military and has the second largest standing military force in the world at 1.4 million active duty

military personnel. At $293.2 billion for fiscal

year 2001, of which $98.2 billion is for the

research, development and production of

weapon systems, the U.S. budget is more than

eight times larger than the French budget. However comparing the percentage of the nation’s

wealth — the Gross Domestic Product — the

United States at 2.9 percent spends approximately the same percent as France. Yet France

has the fourth largest defense budget in the world

and spends on average slightly less than FF 86

billion on its modernization efforts.

The first look at these two countries reveals a

rather striking difference in the size of their defense industries. The United States has by far

the largest defense industry. Three of the top four

defense firms in the world are in the United

States (Lockheed Martin, Boeing and Raytheon)

with the fourth being BAE a British firm. EADS

with significant French involvement is 6th, while

Thales is 8th. This should be expected considering the significant difference in the defense

budgets of both countries. However, France has

the largest defense industry in Western Europe

employing more than 175,000 people, representing 4.5 percent of the total French industrial

employment. It also occupies an important

position in the French economy with more than

5,000 companies involved in defense.

As far as what the United States manufactures,

it has the largest range of products in the world.

France however produces 90 percent of its own

equipment and does offer a wide range of products — ships, aircraft, and tanks. In terms of

skills, it has developed the expertise to design,

develop, and produce its own systems. A main

difference is that the large American defense

firms, Boeing excepted, are defense firms, while

the large French companies have and need a significant commercial market presence to help

offset periods of slow defense spending.

The United States was again the largest supplier

of arms to the world in Fiscal Year 2000. This is

a position it has held for almost a decade. Its

sales in 2000 through its Foreign Military Sales

program to allies and friendly nations were estimated at $18.6 billion dollars. France in the last

decade actually surpassed Russia in the sale of

military equipment. From 1991 to 1999 France

exported FF 334 billion ($46.3 billion), while

the United States sold $83 billion, and Russia

sold about $35 billion. Approximately 6 billion

Euro goes into the export markets in 2000.4

There is a difference in the impact on France

for armament sales. These sales are critical to

its ability to keep a defense industry and its

Figure 6-1. Comparison of FY 2001 Defense Activities

U.S. France

$ 293.2B Budget $ 26.3B (188.9 FF) Budget

$ 98.2B Modernization $ 11.6B (85.0 FF) Modernization

1.4M Active Duty Military Personnel 440,000 Military and Civilian Personnel
The Falcon and the Mirage: Managing for Combat Effectiveness

6-4

worldwide influence. While for the United States

it is important to lower the cost of weapon systems yet protect the health of its defense industry. Both programs in this study are major contributors to the success of armament sales. The

F-16 is the largest Foreign Military Sales procurement program of the USAF, with over 4000

aircraft produced. The Mirage 2000 with armament sales to seven countries of 286 aircraft has

been a significant contributor to the health of

the Dassault and the French defense industry.

The Way of Doing Business

A recent study of French management captures

the French perspective.5

 “As French executives

see it, management is a state of mind, not a set

of techniques. For them, it is the ability to think

logically and analyze systematically that sets

them apart from the rest of the personnel. So to

be named cadre is akin to passing an intelligence

test — it is a hallmark of intellectual caliber. It

follows that the title bestows social as well as

professional consideration on its incumbent. A

cadre “superieur” enjoys the same kind of social

prestige as a lawyer, architect or doctor.” This

statement on the French management outlook

in general also captures at least one aspect of

the cultural differences in approaching organization, policies, procedures and selection of

personnel to run the organization. Management

in the United States tends to revolve around

techniques rather than the state of mind of the

manager.

While both countries have identifiable formalized structures for dealing with the development

and production of weapon systems, the United

States has a more formalized process with its

series of regulations — the Federal Acquisition

Regulation and the DoD 5000 series regulations.

The system is also characterized as being much

more legalistic with it protest procedures, Board

of Federal Contract Appeals, and courts. In France,

on the other hand, you find fewer regulations

and they operate much more informally. Protest

procedures are mostly unused. Even in the structure of its career development, the DoD has a

created a formalized structuring for training,

experience, and education of its workforce.

Training is done in the DGA on a more informal

basis (supervisor to employee).

Size does have an impact. Any organization

operates within an environment. And this environment — the size of organization (number

of people), geography, history, culture, political

climate, bureaucracy, military-civilian relationships and strategic direction — all play a role in

how it organizes and how it operates. The U.S.

system is like any big business with divisions

around the country and the world. This results

in more hierarchy, certainly more rules and regulations. Unquestionably, any reader of Scott

Adam’s cartoon strip Dilbert would recognize

ironic, yet similar management activities found

in Dilbert’s world. Comparing the organizational

structure between the United States and French

acquisition organizations, we also find striking

difference. The United States is highly decentralized both organizationally and geographically. The military Services, operating under the

general policy guidelines of the OSD, are responsible for buying military equipment. Geographically the military departments are decentralized, with buying offices located throughout

the country. Even the F-16 SPO is split between

two offices in separate parts of the country with

its headquarters 450 miles away in Washington.

This certainly contributes to creating a more

complicated management structure to the F-16

PM to operate within. This when added to the

bureaucratic interlocking organizational structure — PEO, SAEs, IWSMs and many more

customers — gives it many bosses.

The DGA is a centralized acquisition organization, separate from the military, with most of

the key players located in Paris. It is certainly

smaller than the comparable U.S. organization
Chapter 6 A Contrast of Program Management

6-5

(149,000 to 6,639 acquisition personnel). From

the aircraft program perspective, it is also fortunate to be located on the same base as Headquarters, French Air Force. Organizationally it

is much more streamlined than the U.S. equivalent. It has a single individual responsible for

acquisition — the Delegate General for Armament — while DoD has not only a central figure at OSD but also three Service Acquisition

Executives.

At the program office level, the obvious difference between the two program offices is the size

of the organization, with the F-16 program office

more than ten times (565 versus 50 personnel)

larger than the Mirage. The yearly budgets for

both countries have been roughly the same over

the last five years, although the FMS portion of

the F-16 has been particularly active with about

$2.6 billion spent in Fiscal Year 2000. Size alone

dictates different management styles. The U.S.

PM focuses more on the management of a large

organization and the relationships with his PEO,

user, and outside organizations. The actual running of the SPO is left to the deputies and division chiefs. With the small staff, the French PM

finds himself much more of a hands-on player.

The mission is also slightly different, with the

Mirage PM no longer having responsibility for

the logistics support of the system, and of course,

no responsibility for armament sales external to

the country.

The difference in selection of the individual to

lead these two program offices also reflects the

difference in the importance given to technical

versus managerial skills. Again the contrast is

apparent. The United States selects military officers as managers with a background in operations and with managerial experience. Most have

been pilots and all have spent time in operational

commands, including combat time in Vietnam

and Korea. The DGA grooms and selects armament engineers, who, while they are military,

are in reality a fourth branch of the military and

not combat personnel. The DGA emphasis is on

a PM with a strong technical background at a

test center and program office. France does recognize the need for operational flying experience and does offer its young armament engineers the opportunity to attend flight test school

either as pilots or flight test engineers.

The selection process for PMs provides a relative similarity of paths for senior leadership —

same schools, same training. This applies to industry and has worried at least some companies.

“French Companies run a risk in focusing on

too like-minded a population. Uniformity of

perspective can facilitate coordination, but it can

also result in impoverished information search

and reality testing, incomplete attention to

alternatives, failure to consider risks, and premature agreement — collectively know as

“group think.”6

 The American pipeline, also

reflects the American cultural differences; PMs

have attended a wide variety of schools from

large (University of Nebraska) to small (St.

Joseph’s College); and while most have at least

one degree in a technical field, one-third completed advanced study in management or

business.

Looking at the difference in acquisition experience, the DGA PM brings, on average, about

six more years of experience to the job (10.3

versus 16.8). And as for the types of acquisition

experience, F-16 PMs have mostly held staff and

management positions while Mirage PMs add

technical focus in test centers and program departments. And finally, regarding tenure, Mirage

PMs have stayed, on average, about 3.75 years

on the job (a goal of 5 years), while F-16 PMs

have averaged about 2.5 years.

Staffs that support the program office in the

DGA contain a mixture of military (armament

engineers (IA), study and techniques engineers

(IETA), and civil servants. Again one sees the

focus on the technical side of the business in the
The Falcon and the Mirage: Managing for Combat Effectiveness

6-6

DGA with even purchasing personnel having a

technical background. The F-16 has a slightly

more experienced workforce with a higher

average acquisition experience level at 15.5

years (10.5 for the Mirage).

Both program offices perform essentially the

same types of work. The general categories of

work were identified in Chapters Four and Five.

Several exceptions, most notably the Foreign

Military Sales responsibility, make up 60 percent of the SPO work and the sustainment responsibility primarily performed at “SPO West.”

One other area worth mentioning is the absence

of initiatives in the Mirage program office, while

F-16 SPO plays a very active role as a Pilot Program for several key Air Force initiatives, such

as RTOC (Reduced Total Ownership Costs).7

Two other areas of interest are contracting and

configuration control. Both program offices are

in a sole source situation, and the dollar values

spent on contracts yearly are roughly the same,

with the exception of the FMS portion of the

SPO’s contracting work.8 Both countries have

to worry about changes to the aircraft. In each

case it is a contractor responsibility, with the program offices reviewing and keeping track of the

changes. The number of ECPs and other changes

in the F-16 SPO has been slowly declining from

150 in 1996 to 40 last year. While I do not have

the same level of detail on the Mirage, it continues to average about 100 changes per year, but

mostly minor changes.

Decision Making

Decision making can be viewed from two levels

— the political and the bureaucratic (executive

and managerial). The political is generally at the

highest level — Congress, Parliament, and political military and civilian leaders. This can affect even what is bought. While the military may

define the need, the political and bureaucratic

leaders make the final decision. Budgets, priorities, and what is referred to in the United

States as “pork” often dictate what is to be

bought. In France, Parliament may not make

changes, but at the political level the “government” often decides what is to be purchased, as

was the case for the Mirage 2000. At the

bureaucratic level, decision making again differs in the two organizations. The F-16 PM has

several chains of command. The PM reports up

through the PEO chain for program management, the AFMC chain of command for sustainment issues. And of course he has a significant

number of users to whom he must respond,

including Air Combat Command and the theater Commanders located around the world. The

Mirage in contrast has a much simpler chain of

command within the DGA — SPAe, DSA and

DGA. It has only one customer — the Headquarters French Air Force. Once a decision has

been made to acquire a new capability, it must

be approved within the DGA then by the Ministry. Once that happens, the PM has his cost,

schedule, and technical goals and delegations

of powers. He and his direct deputies make big

decisions quickly with little need for a lengthy

approval system and without have to justify

themselves in lengthy written detail. Only for

contracting actions does he require outside

approval. In the United States, approval is also

required for contracting actions as well as higher

dollar value acquisition strategies. Finally the

USAF is much more formal in its direction with

the issuance of the PMD.

The U.S. Program Manager generates a variety

of reports — the Monthly Acquisition Report

(for acquisition issues), an annual Combined

Portfolio Review (with the acquisition and military leaders), plus an annual briefing to the Chief

of Staff on F-16 readiness issues. The Mirage

PM briefs once a year to the DGA and the Air

Force staff, where he lays out his plan to accomplish the cost, schedule, and performance

mandates.
Chapter 6 A Contrast of Program Management

6-7

The next management level — the SPO management level — differs significantly. Since the

Mirage PM manages primarily a matrixed organization, he has lesser personnel issues to deal

with such as appraisals and the like. While he

does spend a significant amount of time negotiating for personnel, he is a hands-on manager

where his technical knowledge and skills allow

him to be more deeply involved in issues.9

 In

the case of the F-16, the PM is a manager of a

large organization. The current PM generally

adopts a “hands-off” approach to management.

He reviews key documents primarily for macrolevel, politically sensitive issues. This general

approach flows throughout both SPO — East

and West. At the Division level, weekly and

monthly reviews are conducted with program

management personnel to ensure schedules and

obligation rates are executed as planned. Customer satisfaction is used as a major guideline

to how successful the organization is performing its mission. The IPTs or Country teams have

been delegated specific responsibility for a program or project. As long as they stay within their

cost, schedule, and performance guidelines they

have significant authority to perform their work.

Each IPT tracks its contractor’s progress. One

final comment on the decision-making process

within the SPO — for development, integration,

and production projects with the European Participating Air Forces (Belgium, Denmark, The

Netherlands, Norway and Portugal), they are

treated as part of the program office and become

a part of the decision-making process.

Why the Difference

in Management Styles?

Certainly size and cultural differences (but also

the differences in tasks required of each organization) play a role in how each program offices

responds to meet its mission. Historically, the

DGA has relied upon a small group of elite personnel with highly technical backgrounds. Companies such as Dassault and its founder Marcel

Dassault, the “Godfather” of the French aerospace industry, have focused on technical excellence. They could do this, comfortable in the

knowledge that they were the French “champion” for aircraft. They have been helped by the

national political consensus on defense and the

political structural stability created by the Constitution of the Fifth Republic. What politics has

existed has mostly been represented at the Ministerial and Cabinet level and the “check and

balances” have been internal to the administration and less sensitive to short-term policy

implications.

Organizationally, they have a professional organization, and have adopted a “skunk works” type

approach to management, similar to what the

United States used in programs such as the F117 and that Lockheed has used in its famous

“skunk works.” In comparison, the F-117 development and production was a team of 20-30

on the contractor side and about the same on

the government side. According to a former

Lockheed executive, “The skunk works approach also demands the use of a small number

of high-quality individuals staffing each function. Individuals are given broad responsibility

and have substantial workload. Our experience

has shown that under these circumstances individual achievement is most often much higher

than management’s expectations.”10 This is

exactly the approach used by the DGA. It is

organized around a program manager who is

given total control of all program aspects. Functional organizations support him. They keep the

program offices small, they have fewer rules and

regulations, and they operate more informally.

So what does this all mean? What are some of

the lessons that can be taken from this study?

Certainly cultural differences drive the way

we do business — the difference in the grooming individuals for program management jobs

is just one example. This is an important point

for those individuals working with our allies.
The Falcon and the Mirage: Managing for Combat Effectiveness

6-8

Understanding the cultural background and differences of the people you work with needs to

be a part of the training of those individuals

working in armament sales and in cooperative

programs. But, efficiencies can also be learned

for managing in the acquisition environment.

Several features of the French system are worth

evaluating for application to the Air Force. The

development of senior managers with a technical background destined for Program Management positions may provide the skills necessary

to manage in a smaller office environment. This

extends to the selection of purchasing personnel with a technical background.11 Adopting a

program management philosophy or “mind set”

similar to the F-117 and the Lockheed “Skunk

Works” may be the most important adjustment

since it provides not only the opportunity for

lower operating costs with fewer personnel, but

probably more efficient management — “expect

more of the people and they will not disappoint!”

Fourthly, in addition to the current training

Figure 6-2. Differences Between France and the United States

Category France United States

Political:

Legislative • Limited Legislation by Constitution • Pervasive Congressional legislation

and oversight

Executive • Split – President and PM

• PM largest party or coalitoin in

Parliament

Organization • Small • Strong service staffs

• Separate from Service • Service acquisition organization

• Single agency for all

Resources • Limited • Roughly 10 times the money

• Program stability, but and 20 times the personnel

modernization underfunded • Budget instability – changes yearly

by Congress

Program Offices • Small Program Office • Large Program Office

• PMs are Armement Engineers • Military PMs

• Support team military/civilian • Support team military/civilian

• Mandatory training, education, and

experience for PMs

Industry

Export Sales • Small, diversified, strong govern- • Large, diversified, separate from

ment industry tie-in, including government

ownership • Exports are important to defense

• Critical exports to defense industry industry

Purchasing • Competition but defense is sole • Competition but open market

source limited by U.S. industry lobby

• Market champions and industrial base concerns

• Fixed Price Contracts • Contract type selected based on

situation and risk

Rules and • Limited • Pervasive at all levels

Regulations
Chapter 6 A Contrast of Program Management

6-9

which focuses on techniques, acquisition training efforts using cases studies designed to enhance “critical thinking,” skillsis an important

facet of improving management of programs.12

Coupled with these efforts is the continual need

to reduce the regulatory burden on the U.S.

acquisition community, which was a goal of the

acquisition reform efforts of the 1990s. And

finally, the concept of the Architect of Systems

Forces (ASF) has provided the DGA with a

mechanism to effectively look across mission

areas, target research and development efforts

and to select the most optimum paths for new

weapon system. While each country goes about

its armament work differently, they both have

developed effective acquisition systems that

allows their professionals to deal with the politics, the bureaucracy, the complexities of a tough

job and yet provide the weapons needed by the

warfighter.
The Falcon and the Mirage: Managing for Combat Effectiveness

6-10

ENDNOTES

8. Mirage – FY 98 $334, FY 99 $264, FY 00

$195; F-16 (USAF Work Only) – FY 98

$386, FY 99 $299, FY 00 $180.

9. An interesting perspective came from industry when they referred to the PM as the

Chief Engineer.

10. Leland, Nicolai, “Skunk Works Lessons

Learned,” paper presented at the AGARD

Flight Vehicle Integration Panel symposium

on “Strategic Management of the Cost

Problem of Future Weapon Systems,” held

in Drammen, Norway, 22-25 September,

1997, in Advisory Group for Aerospace

Research and Development (AGARD)

Conference Proceedings, published September 1998, pp. 1-5.

11. This is also true of U.S. commercial industry (hiring buyers with a technical background) as was indicated in several studies

in the 1980s and 1990s on commercial practices.

12. This is currently an initiative of the Defense

Acquisition University particularly for its

more senior courses.

1. Thomas Jefferson, Autobiography, 1821

from http://etest.lib.virgninia.edu/Jefferson/

quotations.

2. Jean Baptist Colbert, 1619-83, French

Comptroller General of Finances under

Louis IV.

3. Thanks to Jean Tisnes for rephrasing an old

French proverb — “War is much too serious a matter to be entrusted to the military.”

4. Aviation Week and Space Technology, February 26, 2001.

5. Barsoux, Jean-Louis and Peter Lawrence,

French Management: Elitism in Action,

Cassell Publishing, Wellington House, 125

Strand, London, 1997, pg. 32.

6. Janus, 1971, cited in Barsoux, Jean-Louis

and Peter Lawrence, French Management:

Elitism in Action, Cassell, Wellington

House, 125 Strand, Longodn, 1997, pg. 31.

7. As the reader may remember from Chapter Five, they are the Pilot Program for a

variety of initiative such as Reduced Total

Ownership Cost (RTOC), Single Process

Initiatives (SPI), Activity Based Costing

(ABC), Product Support Business Area

(PSBA).
Appendix

A-1

APPENDIX
The Falcon and the Mirage: Managing for Combat Effectiveness

A-2
Appendix

A-3

Appendix A

F-16/MIRAGE INFORMATION

F-16 PROGRAM DIRECTORS/PROGRAM MANAGERS

Colonel Lyle W. Cameron 1971-1972

Colonel William E. Thurman 1972-1976

Major General James A. Abrahamson 1976-1980

Major General George L. Monahan, Jr. 1980-1983

Major General Ronald W. Yates 1983-1986

Major General Robert D. Eaglet 1986-1989

Brigadier General Ralph H. Graham 1989-1992

Brigadier General Ronald T. Kadish 1992-1993

Colonel Leslie F. Kenne 1993-1994

Colonel Larry H. Cooper 1994-1998

Colonel Jeffrey R. Reimer 1998-2000

Colonel Mark Shackelford 2000-Present

MIRAGE 2000 PROGRAM MANAGERS

ICA Pierre Tamagnini 1973-1980

ICA Yves Michot 1980-1984

ICA Herve Groualle 1984-1987

ICA Jean-Luc Monlibert 1988-1990

ICA Francois Flori 1990-1991

ICA Pierre Bascary 1990-1996

ICA Bruno Delors 1996-1997

ICA Patrick Dufour 1997-2000

ICA Bruno Berthet 2000-Present
The Falcon and the Mirage: Managing for Combat Effectiveness

A-4

MIRAGE 2000 (DASSAULT)1

2000B: Two seat trainer version of the 2000C

2000C: Standard interceptor with various sub variants (eg S3, S4)

2000RDM: 2000C and 2000B also referred to 2000DA

2000RDI: 2000C with upgraded radar and M53-P2 power plants

2000D(S): Two seat conventional attack variant of 2000N (Export)

2000E(ED): Multi-role fighter for export (Two-seat trainer)

2000N: Low-altitude penetration, with nuclear weapon capability

2000R: Single-seat day/night reconnaissance export of 2000E but fitted with normal

radar nose.

2000-5: Multi-role upgrade incorporating new avionics and weapon carrying

enhancements.

F-16 FIGHTING FALCON (LOCKHEED MARTIN)

F-16A/B: Initial production model and two-seat trainer.

Block 10/15: APG 66 Radar, ALR 69 (radar warning receiver), ALE 40 (countermeasure dispenser system), Fly-By-Wire, Digital Avionics

F-16C/D: Multinational Staged Improvement Program model.

Block 20/5/30: APG 68 Radar, C/D Heads-up-Display (HUD), HAVE QUICK,

AMRAAM (advanced medium range air-to-air missile), ALR 69, MLU,

Pratt-Whitney and General Electric Engines

Block 40: APSP (Advanced Programmable Signal Processor), WAR, LANTIRN

(day/night stand off target identification system), Global Positioning

System (GPS), APG 68 Radar, GAC (General Avionics (or Aircraft)

Computer), ALE 47E, AFR-56M, Digital Flight Control System, AIFF

(Advanced Identification Friend or Foe), PW and GE Engines.

Block 50: Digital Engine Monitor, RLG (Ring Laser Gyro), HSD (High Speed Data

Base/BUS), GAC/MMC (General Avionic Computer/Multi-mission

Computer), APSP, GPS, UPDG (Upgraded Programmable Display Generator), APG 68 Radar, HARM (High-Speed Anti Radiation Missile)

AVIONICS, EXPANDED MEMORY, PW and GE Engines

Block 50+/60: UAE Commercial Sale (F-16U)/- NORWAY 50N FMS Competition—

Advanced avionics for JDAM compatibility plus increased drop tank

capability. APG-78 radar, RLG INS (inertial navigation system/inertial

navigation system) W/GPS, IFTS (Internal FLIR (Forward-Looking

Infrared) targeting System), ALQ-2005 (electronic countermeasures

systems), Upgraded DFC (Digital fire control), 3 Large Color Displays,

Color Moving Map, Two-Place Equipment Dorsal, Conformal Fuel Tanks,

600-Gallon Tanks, 50,000 lb Max TOGW (Take-Off Gross Weight).

F-2: Japanese Self-Defense Forces—Mitsubishi aircraft evolved from F-16.

1

 Source: Jane’s Pocket Guide, ADVANCED TACTICAL FIGHTERS; Harper Collins Publishers 1998 and the F-16 Program Office.
Appendix

A-5

Appendix B

FRANCE AND UNITED STATES

DEFENSE BUDGETS

1996 TO 2002

FRANCE1

Years

Category 1996 1997 1998 1999 2000 2001 2002

Budget FF2 189.6 190.9 184.7 190.0 188.0 188.9 191.3

Budget Euro3 28.9 29.1 28.2 29.0 28.7 29.8 29.2

Modernization 80.7 86.0 82.9 85.0 83.5

% of GDP 3.0 3.0 2.8 2.8 2.5 2.9

Mirage Budget4bF 4.0 3.3 2.4 1.9 1.4 1.1

$ 556m 459m 334m 264m 195m 153m

UNITED STATES5

Years

Category 1996 1997 1998 1999 2000 2001 20026

Budget $ 255.1 254.2 259.1 272.7 284.2 292.3 295.8

% of GDP 3.5 3.3 3.1 3.0 3.0 2.9

AF Budget $ 74.2 73.1 76.5 80.1 82.1 85.6 88.5

AF Modernization 29.1 28.5 29.6 31.9 33.2 34.6 36.9

F-16 Budget7 $ 511m 426m 386m 299m 180m

1

 Various sources to include latest programming law proposals and budgetary announcements from the DGA and Ministry.

2

 Excludes pensions

3

 The current exchange rate with the FF is 6.56 and is roughly equivalent to the dollar.

4

 Sourcce DGA/DSA/SPAe/GP

5

 Source is the DOD Comptroller’s March 2001 Report.

6

 Proposed President’s Budget

7

 Source F-16 Program Office
The Falcon and the Mirage: Managing for Combat Effectiveness

A-6

Appendix C

F-16 ORGANIZATIONS

PROGRAMS GROUP (ASC/YPX AND OO-ALC/YPX)

The Program Group (YPX) manages a range of development, test, production or modification

programs for its three customer groups — the USAF, the European Participating Air Forces (EPAF),

and the Foreign Military Sales (FMS) customers. There are 103 personnel working in Dayton and

129 at SPO West for a total of 2321 personnel. The breakout for work responsibilities between the

two Groups is indicated in Figure 5-5. Normally, SPO East takes the lead on all F-16 new FMS

programs, while SPO West has responsibility for the logistics planning and sustainment aspects of

USAF and international programs, although the primary work of their support is FMS customers.

SPO East

The Combat Capabilities Upgrade Branch (YPXA) manages new development, integration, and

major avionics modernization programs for the EPAF (Blocks 10/15) fleet and USAF (Blocks 40/

42 and 50/52) fleet. Currently they are currently managing seven major upgrades to the F-16. The

advantage of managing both the USAF and EPAF fleets in the same branch is to keep development

costs at a minimum by using common hardware processors and configurations that allow the USAF

and EPAF to share costs. (Functions2 : Program Management, Engineering)

The Production Branch (YPXB) manages the FMS program for twelve countries. For each country they have created a “country teams” organized under the principles of an Integrated Product

Team (IPT) led by a Security Assistance Program Manager (SAPM) with membership from the

program office, contractor(s) and foreign representatives from the countries involved. Typically a

team consists 4-5 core members with participation from others as required. The teams can vary

from a small team of 1 or two personnel, to a large team, such as for Israel and Greece, which can

be as large as 10-15. It is also characteristic of the prime contractor to mimic the team with roughly

the same types of personnel. The F-16 SPO provides a management service to the FMS customer

that includes all aspects of acquisition — development, production, test, deployment, site activation,

facilities construction, training, training equipment, spares and logistics support of the aircraft and

associated systems. This branch also has the responsibility for managing the acquisition of new

USAF production aircraft when Congress authorizes new buys, as happened in the FY 2001

Appropriations Act. (Function: Program Management, Engineering)

1 All personnel numbers are as of 22 March 2001 and provided by ASC/YPO Ms Lisa Shannon.

2

 Functions as used in this section refers to the career fields of personnel in the branches and also the functions performed in that branch. As an

example the individual could be a Logistic Management Specialist by career field, but performing a program management job as a Security

Assistance Program Manager.
Appendix

A-7

The Flight Test Branch (YPXT) manages flight test processes and resources for USAF, EPAF,

and FMS programs to verify the combat capability of the F-16 weapon system. They also have

management responsibility to work with the Japanese on the development of the F-2, an F-16

derivative. (Function: Test & Evaluation)

SPO WEST (OO-ALC/YPX)

Two FMS International Branches

The two International Branches (YPXV and YPXB) manage FMS programs. Each Country

Team has 5-6 people on it depending upon the needs of the program. The current country teams are:

Portugal, Taiwan, Denmark/Norway, Korea, The Netherlands, Israel, Thailand, Singapore, Turkey,

Greece, Egypt, Bahrain, Jordan, and Venezuela. They manage approximately 20 modifications per

year for the FMS customers. (Function: Logistics, Program Management, Inventory Management,

and Financial Management)

The Sustainment Branch (YPXG) operate a “help desk,” for customers on a “pay as you go

basis,” by providing technical assistance in maintaining, modifying and operating the aircraft. This

provides the user — foreign or domestic — with a single focal point for questions on the F-16

sustainment. This branch has its counterpart at SPO East — the Customer Support Branch in the

Products Branch. (Function: Logistics)

The Logistics Integration Branch (YPXX) has two primary activities. They regenerate F-16s from

the “boneyard” at Davis-Monthan Air Force Base near Tucson, Arizona for the refurbishment and

sale to international customers. The USAF has about 350 early version F-16A/B aircraft currently

in storage at the Aerospace Maintenance and Regeneration Center (AMARC)3 . With international

interest high in obtaining F-16s the USAF began in the 1994 timeframe to look at early version

F-16 A/Bs for possible FMS sale. The cost of a regenerated aircraft is about two-thirds of a current

production aircraft, and while not as capable as current designs, it can be refurbished and provide

more capability than when they were originally built. They recently signed a contract with Italy for

36 regenerated aircraft. Since they started this program they have regenerated 70 aircraft. This

branch also manages the development of new depot repair capability for interested FMS customers. They have three teams developing depot capability for high failure and expensive repair items

for Turkey, Greece, and Egypt. (Function: Program Management, Logistics)

PRODUCT GROUP (ASC/YPV AND OO-ALC/YPV)

The Product Group (YPV) is the process and common systems staff within the SPO. They will

provide technical definition of new requirements, systems engineering, manufacturing and safety

for the aircraft and its subsystems. If an IPT or Country Team has need of systems engineering

expertise YPV’s Flight Systems, Sensor and Systems Engineering branch will provide the personnel

3

 The web site for AMARC is: http://www.dm.af.mil/amarc/default.htm.
The Falcon and the Mirage: Managing for Combat Effectiveness

A-8

to support the effort. They also have engineering responsibility for the common systems, e.g. engines,

ejector seats, and EW. This organization as part of its technical responsibilities has oversight of

configuration and manufacturing management. They also manage, along with Ogden, the many

minor modification programs, such as the Night Vision installation in the F-16s. The other two

branches are the Acquisition Initiatives Branch and the Requirement Program Development Branch.

There are 80 personnel working in Dayton and 72 in Ogden for a total of 152.

SPO East

Two Common Systems Branches

The Flight Systems Branch (YPVF) has engineering responsibility for common products between

all versions of the F-16, covering the cockpit, air vehicle, and external carriage, which includes

items such as OBOGS, wheels and brakes, and hydraulic system. (Function: Engineering (Specialty)

The Sensors Branch (YPVI) has engineering responsibility for common products covering mission

planning, sensors, avionics and electronic warfare, which includes items such as radios, radar, and

counter measure systems. (Function: Engineering – Specialty)

The Systems Engineering Branch (YPVE) provides a range of engineering skills for integration

management and technical direction for manufacturing, configuration, data, environmental, quality,

safety, airworthiness, health and systems management. This branch administers the Configuration

Control Boards — the Joint Multi-national Configuration Control Team (JMCCT) and the Joint

Multi-National Configuration Control Board (JMCCB) — both discussed later. The appropriate

contractor, usually Lockheed, does the actual configuration updates of drawing and specification,

but the SPO is responsible for approving changes to the technical baseline, through Engineering

Change Proposals (ECPs). (Function: Engineering – Systems, Specialty, Data Management,

Configuration, and Manufacturing)

The Acquisition Initiatives Branch (YPVB) tracks the implementation of acquisition initiatives

such as Reduced Total Ownership Cost (RTOC), Single Process Initiatives (SPI), Activity Based

Costing (ABC) and Product Support Business Area (PSBA), several for which the F-16 has been

selected as a pilot program. (Function: Financial Management, Program Management)

The Requirements and Program Development Branch (YPVR) is the outside interface branch.

When a new FMS or USAF effort is planned they are the first stop. Their efforts will begin with

working level discussions with staff officers in the Pentagon. They are the focal point for Congressional, OSD, or AF Headquarters questions. They also work closely with YPF on budgetary issues

whether providing oversight, or analysis and alternatives on the USAF budget. They administer the

Integrated Requirements Review Board and the Executive Review Board, which look at the validity

of requirements and then the funding availability. (Function: Engineering – Specialty)
Appendix

A-9

SPO West (YPV)

The Structures Branch (YPVS) provides field and depot engineering and technical support for

the aircraft structures including mechanical items. This is accomplished through field dispositions,

system technical orders, and time compliance technical orders (TCTO) management, depot line

support and mishap investigation assistance. They also manage the Aircraft Structural Integrity

Program (ASIP), Reliability Centered Maintenance (RCM), Analytical Condition Inspection (ACI),

and Non-Destructive Inspection programs. Finally they plan, implement and manage major structural and mechanical upgrade programs, such as the Falcon UP, The Service Life Improvement

Program (SLIP), the Service Life Extension Program (SLEP) and Falcon STAR. Additional subsystems they have responsibility for are the Landing/Gear/Anti-skid Brake System, Oxygen OnBoard Generation System, Engines/Jet Fuels Starters/Auxiliary Drive systems, Hydraulic System,

Pneumatic System, Flight control System, Egress System and Environment Health and Safety.

(Function: Engineering, Equipment Specialist and Logistics Management)

The Operational Flight Program Software Branch (YPVO) primarily manages embedded

software and computers updates to the F-16 for USAF and FMS customer for all pre-block 40

aircraft. They have three functional disciplines in the office — Program Managers, Engineers, and

Logisticians — to oversee the software work of contractors. Much of their contracting efforts are

with another Ogden ALC organization — the Technology and Industry Support Directorate (OOALC/TI). (Function: Program Management, Engineering, and Logistics Management)

The Product Integration/New Business Branch (YPVT) reviews and approves contractor prepared

Technical Orders and then is responsible for their distribution (they manage 15,000 Time Compliance

Technical Orders (TCTOs). They also provide organic support for the flight manual program, weight

and balance, munitions loading and special inspection and maintenance requirements. They work

closely with SPO East processing Engineering Change Proposals/Contract Change Proposals (ECPs/

CCPs) and Advanced Change Study Notices (ACSNs). (Function: Equipment Specialist, Logistics

Management)

The Product Management Branch (YPVP) is the single POC between the Depot and the F-16

SPO for modifications and repairs. They keep the “modification roadmaps” and coordinate project

requirements to maximize the schedule and minimize the cost. They work with the depot facilities

to gather cost and pricing data for cost estimates for customers. As the SPO liaison for sustainment

they participate in aircraft damage repair assessments and evaluation of aircraft destined for AMARC.

(Function: Logistics Management)

BUSINESS GROUP (ASC/YPF, YPK, YPO)

The Business Group as is indicated in Figure 5-4 does not have a counterpart at SPO West, at least

as a separate function. The Business Group has three branches with the following functions:
The Falcon and the Mirage: Managing for Combat Effectiveness

A-10

The Financial Management Division (YPF) is the “money manager” for the SPO. They have

three areas of responsibility — cost estimating, financial management and budgeting. They prepare,

with inputs from contractors; the cost estimates used for FMS sales. They allocate financial resources

and maintain funds control for the SPO. Yearly they spend about $500 M on the USAF side, but

have overall responsibility for about 1.5 billion in total money managed. On the FMS side they

receive and spend about $500 M to $1 billion in new work business yearly. They also have the

responsibility to monitor the contractor’s program cost and schedule performance, including

adherence to the Cost/Schedule Control System Criteria (C/SCSC). One of the routine financial

activities that takes place during the budget preparation cycle is the “What if?” exercises. Typically

a headquarters office will ask questions like — What if we reduce your program by $10 million or

if we reduce quantity by 10 percent, what impact does that have on your program. YPF has 49

personnel in its three branches, or teams — one for USAF Financial Management (YPFF) and two

for International Financial Management (YPFA/B). (Function: Financial Management)

The Contracting Division (YPK) awards and administers the F-16 contracts. This includes, but is

not limited to, Acquisition Planning, Contract File Preparation and Contract Award. Contracting

encompasses preparation and approval of, Requests for Proposals (RFPs), source selections, factfindings, negotiations, reviews, and awards of contractual actions. YPK has 42 personnel in its four

branches. Three of these branches — Production (YPKA), Major Upgrades (YPKB), Product

Support (YPKD) — manage contracts for FMS and USAF. The final branch — Contracts Systems

Management Branch (YPKP) handles a variety of administrative activities from contract closeout

to the Procurement Management Information System (MIS), to leases, small business and

competition plans. (Function: Contracting)

SPO West Contracting

SPO West contracting is organized differently. They provide matrixed support to the F-16 SPO, as

well as to other organizations, such as the Mature and Aging Aircraft Directorate and the supply

chain management organizations. They do not work directly for the PM, but provide about 11.5

man-years of effort to the SPO West. No military in the organization and they are not members of

any of the SPO IPTs. (Function: Contracting)

The Management Operations Division (YPO) provides support for personnel matters, training,

information management, security, supplies, equipment, communication and facility management.

(Function: various — primarily personnel and administration)

LOGISTICS SUPPORT GROUP (ASC/YPL AND OO-ALC/YPL)

The Logistics Support Group is made up of two sister divisions — one responsible for Acquisition

Logistics (SPO East) and the other Systems Support activities (SPO West). The Acquisition Logistics

Division is responsible for the management of all Integrated Logistics Support acquisition functions,

including development of all F-16 support equipment and technical orders. They are also responsible
Appendix

A-11

for warranty management, post-production support planning and they are the SPO focal point for

technical customer support.4 The System Support Division provides daily liaison with the F-16’s

suppliers who collectively provide sustainment for the fleet. They also serve as the primary support

interface between the Air Force Headquarters and other commands on issues impacting the readiness

of the weapon system and they are the SPO focal point for technical customer support. There are 41

personnel working in SPO East and 29 in SPO West for a total of 70 personnel.

SPO East

Customer Support (YPLD), with the Sustainment Branch at SPO West, provides the user a

single focal point via the F-16 “Falcon Hotline” for all technical and logistics issues. If a problem

is significant enough and requires on site assistance they will dispatch a Crisis Management Team

to aid the user. To spot problems earlier they also track trend failures, incidents and corrective

actions on flight critical and high visibility aircraft systems. (Function: Logistics Management)

Product and Product Support (YPLV) has the basic responsibility for support equipment

recommendations, preparing Price and Availability (P&As) for FMS buys, managing the SPO

technical library, and financial administration responsibility for SPO logistics funds. (Function:

Logistics Management)

Program Support Branch (YPLX) is responsible for Integrated Logistics Support (ILS)

management. They participate and support SPO IPTs to ensure maintenance and logistics issues

are addressed. This includes development of all F-16 Organizational, Intermediate, and Depot level

support equipment and Technical Orders. (Function: Logistics Management)

Combined LifeTime Support Branch (YPLC) has responsibility for a special initiative called

Total System Performance Responsibility (TSPR) which places configuration control with the

contractor. (Function: Logistics Management)

SPO West

The Analysis and Requirements Branch (YPLA) is responsible for support for three distinct

functions — supply support, maintenance analysis and sustainment forums. Supply support functions

is responsible for parts resolution, development of RSP requirements, and war planning. Analysis

includes identification and analysis of critical maintenance indicators, reliability and maintainability

analysis and aircraft inventory file maintenance. They also administer several forums for determining

the quality of SPO support to the users and to identify and resolve customer issues. They are the

System Supportability Review (SSR), Senior Executive Management Review (SMR) and any OOALC/CC Management Reviews. (Function: Logistics Management)

4 Note: The SPO focal point for customer support is at SPO west under YPL. The SPO East Customer Support Group functionally works for the

SPO West focal points.
The Falcon and the Mirage: Managing for Combat Effectiveness

A-12

The Customer Support Branch (OO-ALC/YPLB) provides a 24-hour a day “help desk” or Hotline

for technical assistance. Their Non Commissioned Officers (NCOs) work customer issues and can

form a Crisis Management Team (CMT) to quickly resolve a customer’s critical technical issue and

send the CMT to a customer’s site. They also have the responsibility for issuing Time Compliance

Technical Orders (TCTOs) for exigent changes to the aircraft. (Function: Logistics Management)

The Management Operations Branch (OO-ALC/YPLO) manages the manpower, personnel,

financial and management operations for “SPO West.” They have seven matrixed financial

management personnel from the Logistics Center to support management of funds and for preparation

for budgetary input to the Budgeting portion of the Planning, Programming and Budgeting System

(PPBS). They also have an analysis branch, which tracks the health of the fleet through several data

bases for mission capability trends. (Function: Personnel, Financial Management, and Logistics)

Others: ASC/YP (EN) Engineering. The senior collocate from engineering is assigned to the YP

FOG as the Technical Director. The Programs and Product divisions are assigned a Chief Technical

Integrator while the rest of the engineering workforce is assigned to various IPTs. The mission of

engineering is to ensure that the F-16 PM is provided engineering visibility, technical alternatives,

risk assessment, and technical recommendation in making required decision. Engineering also

establishes weapon system performance, design, test and engineering support requirements. Technical

Integration, manufacturing, environmental, system safety and configuration function specialties

are accomplished by engineering. The Technical Director also leads the effort to provide technical

oversight and develops and maintains processes for Operational Safety, Suitability and Effectiveness

(OSS&E) certification.
Appendix

A-13

F-16 SPO TASKS PERFORMED

Program Management

• Integration of Program Activities

• Approval of Program Plans

• Program Management Reviews (with

Users, Headquarters, etc.)

• Program Status Reporting

• Program Direction

• Strategic Planning

• Workforce and Organization Shaping

• Contractor Oversight

Contracting

• Acquisition Strategy Development

• Market Research

• Negotiation

• Request For Proposal development

• Contract Preparation

• Contract Award

• Contract Administration

• Award Fee Administration

• Modification of Contracts

• Exercise of Yearly Options

• Contract Closeout

Systems Engineering

• Specification Preparation/Approval

• Conducting Preliminary and Final

• Design Reviews

• Review Contractor Engineering Status

• Statement of Work Review

• Contractor Oversight

Configuration Management

• Review of Engineering Change

• Proposals

• Configuration Audits

Manufacturing Management

• Review of Contractor Preparation for

Production

• Contractor Oversight

Testing

• Test and Evaluation Planning

• Preparation and Review of Test and

Evaluation Master Plans

Financial Management

• Preparation of the Program Budgets

• Program Objective Memorandum

(POM)

• President’s Budget (PB)

• Management of SPO Financial

Resources

• Management of Schedules

• Financial Forecasts

• Review of the Contractor Program

Financial Status

Acquisition Logistics/Logistics

• Support

• Supply Support Preparation

• Spares

• Provisioning

• Maintainability Assessments

• Authorize Technical Orders (TOs)

Production/Modification Management

Equipment Management

Item Management

Foreign Military Sales Support
The Falcon and the Mirage: Managing for Combat Effectiveness

A-14

AFCA (MIRAGE 2000) PROGRAM OFFICE TASKS PERFORMED

Program Management

• Integration of Program Activities

• Approval and Development of Program

Strategies

• Program Management Reviews (yearly

with Headquarters)

• Program Status Reporting

• Program Direction

• Strategic Planning

• Workforce and Organization Shaping

• Production/Modification Management

• Contractor Oversight

Achats (Purchasing)

• Acquisition Strategy Development

(DPM Actual Approval)

• Market Research

• Negotiation (Evaluation of Proposals)

• Request For Proposal Development

• Contract Preparation

• Contract Award

• Contract Administration

• Modification of Contracts

• Exercise of Yearly Options

• Contract Closeouts

Quality

• Specification Preparation

• Oversight of Contractor

• Review of Contractor’s Procedures

• Configuration Management

• Review of Engineering Change

Proposals

• Configuration Audits

• Review of Contractor Preparation for

Production

• Contractor Oversight

• Acceptance and Qualification of

Aircraft

• Engineering Specification Preparation/

Approval

• Conducting Preliminary and Final

Design Reviews

• Review of Contractor Engineering

Status

• Statement of Work Review (occasionally used)

• Contractor Oversight

Plans, Programs, Budget, and Finance

• Preparation of the Program Budgets

• Management of Internal Financial

Resources

• Management of Schedules

• Financial Forecasts

• Review of the Contractor Program

Financial Status

Acquisition Logistics/Logistics

• Support

• Supply Support Preparation

• Initial Provisioning

• Development of Test Equipment

• Reliability/Maintainability Assessments

• Authorize Technical Orders (TOs)

(shared with Air Force)

Testing

• Test and Evaluation Planning

• Preparation and Review of Test Plans

Armament Sales Support
Appendix

A-15

Appendix D

QUESTIONNAIRES

QUESTIONNAIRE – UNITED STATES

Career Field:

Contracting

Financial Management

Program Management

Logistics

Science and Engineering

Speciality ___________________________________

Testing & Evaluation

Other ___________________________________________

Military/Civilian Rank: Capt./GS-12 Major/GS-13

Lt. Col./GS-14 Col./GS-15

Gen./SES

Education:

High School

Bachelors

Masters

PhD

Name of Undergraduate School ____________________________________________

Name of Graduate School _________________________________________________
The Falcon and the Mirage: Managing for Combat Effectiveness

A-16

Training:

Certified Level: I II III

Additional Career Field Certification:

Years of Acquisition Experience:

0-2

3-5

5-10

10-20

over 20

Current Title (e.g., Director, Analyst): ____________________________________________

Government

Contractor
Appendix

A-17

QUESTIONNAIRE – FRANCE

Career Field:

Achats (Purchasing)

Qualite (Quality)

Expertise de couts

Plans, programmes, budget, finance

Management de programme

Logistique

Engineering

Speciality ___________________________________

Testing & Evalution

Autre ___________________________________________

Military Rank: 1. Igenieur de l’armement

IA IPA ICA

2. Ingenieurs des Etudes et Techniques d’arament

I1ETA IPETA

IC2ETA IC1ET

Civilian Rank: 1. Fonctionaire

Niveau 1 Niveau 2 Niveau 3

2. ICT
The Falcon and the Mirage: Managing for Combat Effectiveness

A-18

Education (mark all that apply):

Baccalaureat

Technicien

Ecole d’ingenieur (preciser) ___________________________________

ENA

Autre (preciser) _____________________________________________

Training:

Experience acquise dans le domaine des acquisition (en annees):

0-2

3-5

5-10

10-20

over 20

Current Position (e.g., Director, Analyst): ________________________________________
Appendix

A-19

— SAMPLE QUESTIONNAIRE —

TYPE OF WORK/DELEGATION OF AUTHORITY/DECISION MAKING

What is your title and job?

Who is your immediate supervisor?

How is the (program) office organized?

• What type of decisions do you delegate?

• What senior levels do you need to go to for approval?

• How often do you hae to go to senior authority?

• What kind of decisions does the PM have to formally sign off?

What is your interaction with the contractor(s)?

• How often do you meet with them?

What types of work does your organization perform?

• What are workload drivers?

• How do you measure workload?

• How do you determine whether or not you are successful (what measures)?

• What role does FMS-type work play in your organization?

• How many dollars do you control or have responsibility for?

How much top-level involvement in your program (Congress, Headquarters, etc.)?

• How much do the following organizatins impact your work (H, M, L)?

– Congress

– OSD Headquarters

– AF Headquarters

– AFMC Headquarters

– ASC Headquarters
The Falcon and the Mirage: Managing for Combat Effectiveness

A-20

How well-trained is your workforce? Do they receive yearly adequate training? How do career

paths impact training?

How much does the contracting process impact your workload (H, M, L)?

• Market Evaluation

• RFP Preparation

• ASP

• Sources Selection

• Contract Administration (management of program)

• Protest Procedures

• Award Fees (how many)
Appendix

A-21

APPENDIX E

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Appendix

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The Falcon and the Mirage: Managing for Combat Effectiveness

A-24

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Appendix

A-25

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2001.

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