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97–494 2016

[H.A.S.C. No. 114–60] 

SHORTENING THE DEFENSE 

ACQUISITION CYCLE 

COMMITTEE ON ARMED SERVICES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD 

OCTOBER 27, 2015 
(II) 

COMMITTEE ON ARMED SERVICES 

ONE HUNDRED FOURTEENTH CONGRESS

WILLIAM M. ‘‘MAC’’ THORNBERRY, Texas, Chairman 

WALTER B. JONES, North Carolina 

J. RANDY FORBES, Virginia 

JEFF MILLER, Florida 

JOE WILSON, South Carolina 

FRANK A. LOBIONDO, New Jersey 

ROB BISHOP, Utah 

MICHAEL R. TURNER, Ohio 

JOHN KLINE, Minnesota 

MIKE ROGERS, Alabama 

TRENT FRANKS, Arizona 

BILL SHUSTER, Pennsylvania 

K. MICHAEL CONAWAY, Texas 

DOUG LAMBORN, Colorado 

ROBERT J. WITTMAN, Virginia 

DUNCAN HUNTER, California 

JOHN FLEMING, Louisiana 

MIKE COFFMAN, Colorado 

CHRISTOPHER P. GIBSON, New York 

VICKY HARTZLER, Missouri 

JOSEPH J. HECK, Nevada 

AUSTIN SCOTT, Georgia 

MO BROOKS, Alabama 

RICHARD B. NUGENT, Florida 

PAUL COOK, California 

JIM BRIDENSTINE, Oklahoma 

BRAD R. WENSTRUP, Ohio 

JACKIE WALORSKI, Indiana 

BRADLEY BYRNE, Alabama 

SAM GRAVES, Missouri 

RYAN K. ZINKE, Montana 

ELISE M. STEFANIK, New York 

MARTHA MCSALLY, Arizona 

STEPHEN KNIGHT, California 

THOMAS MACARTHUR, New Jersey 

STEVE RUSSELL, Oklahoma 

ADAM SMITH, Washington 

LORETTA SANCHEZ, California 

ROBERT A. BRADY, Pennsylvania 

SUSAN A. DAVIS, California 

JAMES R. LANGEVIN, Rhode Island 

RICK LARSEN, Washington 

JIM COOPER, Tennessee 

MADELEINE Z. BORDALLO, Guam 

JOE COURTNEY, Connecticut 

NIKI TSONGAS, Massachusetts 

JOHN GARAMENDI, California 

HENRY C. ‘‘HANK’’ JOHNSON, JR., Georgia 

JACKIE SPEIER, California 

JOAQUIN CASTRO, Texas 

TAMMY DUCKWORTH, Illinois 

SCOTT H. PETERS, California 

MARC A. VEASEY, Texas 

TULSI GABBARD, Hawaii 

TIMOTHY J. WALZ, Minnesota 

BETO O’ROURKE, Texas 

DONALD NORCROSS, New Jersey 

RUBEN GALLEGO, Arizona 

MARK TAKAI, Hawaii 

GWEN GRAHAM, Florida 

BRAD ASHFORD, Nebraska 

SETH MOULTON, Massachusetts 

PETE AGUILAR, California 

ROBERT L. SIMMONS II, Staff Director 

LYNN WILLIAMS, Professional Staff Member 

SPENCER JOHNSON, Counsel 

ABIGAIL GAGE, Clerk 
(III) 

C O N T E N T S 

Page 

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS 

Davis, Hon. Susan A., a Representative from California, Committee on Armed 

Services ................................................................................................................. 2 

Thornberry, Hon. William M. ‘‘Mac,’’ a Representative from Texas, Chairman, 

Committee on Armed Services ............................................................................ 1 

WITNESSES 

Chu, David S.C., President, Institute for Defense Analyses ................................ 4 

Francis, Paul L., Managing Director, Acquisition and Sourcing Management, 

U.S. Government Accountability Office .............................................................. 7 

Hunter, Andrew, Director, Defense-Industrial Initiatives Group, Center for 

Strategic and International Studies ................................................................... 2 

Pasqua, Joe, Member, Business Executives for National Security ..................... 6 

APPENDIX 

PREPARED STATEMENTS: 

Chu, David S.C. ................................................................................................ 60 

Francis, Paul L. ................................................................................................ 79 

Hunter, Andrew ................................................................................................ 47 

Pasqua, Joe ....................................................................................................... 71 

Smith, Hon. Adam, a Representative from Washington, Ranking Member, 

Committee on Armed Services ..................................................................... 45 

DOCUMENTS SUBMITTED FOR THE RECORD: 

‘‘Running the Pentagon Right: How to Get the Troops What They Need,’’ 

by Ashton B. Carter, Foreign Affairs, December 6, 2013 .......................... 95 

Enclosure 13, Rapid Fielding of Capabilities, from DODI 5000.02, January 7, 2015 ..................................................................................................... 104 

WITNESS RESPONSES TO QUESTIONS ASKED DURING THE HEARING: 

Ms. Speier ......................................................................................................... 117 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING: 

Mr. Thornberry ................................................................................................. 121 

(1) 

SHORTENING THE DEFENSE ACQUISITION CYCLE 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON ARMED SERVICES, 

Washington, DC, Tuesday, October 27, 2015. 

The committee met, pursuant to call, at 10:00 a.m., in room 

2118, Rayburn House Office Building, Hon. William M. ‘‘Mac’’ 

Thornberry (chairman of the committee) presiding. 

OPENING STATEMENT OF HON. WILLIAM M. ‘‘MAC’’ THORNBERRY, A REPRESENTATIVE FROM TEXAS, CHAIRMAN, COMMITTEE ON ARMED SERVICES 

The CHAIRMAN. Committee will come to order. Appreciate our 

members, witnesses, and guests for joining us today on this hearing related to acquisition reform. As you can tell, there are party 

conferences still going on, and so members will be coming in as 

those conclude. 

Let me just say that a major priority for this committee has 

been, and will continue to be, improving our acquisition system. 

Partly, it is to help get more value for the taxpayer dollars. In my 

mind even more important, is to have a more agile system that can 

better respond to the myriad of complex national security challenges facing our country. 

And it is at least my belief that unless we improve our acquisition system, we cannot keep up with the many challenges that we 

face. At the same time, while we are trying to improve our acquisition system, the acquisition process has to work every day. You 

have got to get that rifle into the hands of that soldier in Afghanistan and do all the other things that are required of the system. 

And so, I believe we can’t have a 2,000-page bill that fixes acquisition. We have to take it a step at a time. I think we made some 

good progress, good first steps in the fiscal year 2016 National Defense Authorization Act, working on some of the basics when it becomes law. 

But there are more steps to go, and that is the reason for today’s 

hearing, to benefit from the experience and wisdom of our distinguished witnesses on next steps, and direction for the acquisition 

reform efforts undertaken by this committee and the Senate committee, working with the Pentagon. One thing everybody agrees on 

is that we have got to do better, and so largely this has been a cooperative effort. 

Let me yield to the distinguished gentlelady from California for 

any comments she would like to make on behalf of the ranking 

member. 
2 

STATEMENT OF HON. SUSAN A. DAVIS, A REPRESENTATIVE 

FROM CALIFORNIA, COMMITTEE ON ARMED SERVICES 

Mrs. DAVIS. Thank you, Mr. Chairman. I am delighted that you 

are all here today. We appreciate it very much. 

On behalf of the ranking chair, Mr. Smith, I wanted to submit 

his statement for the record and also acknowledge how difficult it 

is to find that appropriate balance between the acquisition cycle 

time, and risk. We know that needs to be done. And also, how do 

we nurture innovation and developmental testing within the acquisition cycle. That is also a big concern and something that he notes 

in this particular statement. 

Again, thank you very much for being here. We look forward to 

your testimony. 

The CHAIRMAN. Thank the gentlelady. 

[The prepared statement of Mr. Smith can be found in the Appendix on page 45.] 

The CHAIRMAN. We will now turn to our witnesses, Mr. Andrew 

Hunter, director of Defense-Industrial Initiatives Group at Center 

for Strategic and International Studies [CSIS]; Dr. David Chu, 

President of the Institute for Defense Analyses [IDA]; Mr. Joe 

Pasqua, member of the Business Executives for National Security 

[BENS]; and Mr. Paul Francis, managing director for acquisition 

and source management from the Government Accountability Office [GAO]. 

Without objection, your full written statements will be made part 

of the record, and I would ask each of you to summarize them at 

this point before we go to questions. 

Mr. Hunter, I guess we are starting with you. 

STATEMENT OF ANDREW HUNTER, DIRECTOR, DEFENSE–INDUSTRIAL INITIATIVES GROUP, CENTER FOR STRATEGIC 

AND INTERNATIONAL STUDIES 

Mr. HUNTER. Well, thank you, Mr. Chairman. And it is really a 

pleasure to be back here at the committee where I spent so much 

time learning from members like yourself, some of whom are still 

here and some of whom have departed the Congress. But it is a 

pleasure to be back. 

And I commend the committee for its focus on acquisition reform, 

which is, I know, a focus of longstanding, but remains a very important focus, and obviously one that brings you into alignment, as 

you mentioned, with the leadership of the Senate Armed Services 

Committee and with the leadership of the Department of Defense. 

And I do believe there is a golden opportunity here with this 

meeting of the minds or alignment of focus to make some real 

progress. And certainly at CSIS this has been a focus for us as 

well, so it is something that we share. 

The focus today is on ‘‘faster.’’ I want to briefly mention the fact 

that acquisition is about balancing priorities. And so the old saw, 

‘‘Faster, better, cheaper: Pick any two,’’ is something that I just 

want to start and mention that in picking ‘‘faster’’ you have to be 

willing to sacrifice at least one of the other two. And when I say 

‘‘sacrifice,’’ I mean deemphasize or make a lower priority. And so 

if you are going ‘‘faster,’’ then either ‘‘better’’ or ‘‘cheaper’’ has to 
3 

sort of be willing to give a bit in order to achieve a significantly 

faster outcome. 

Now, of course, when I say ‘‘sacrifice,’’ when I mean ‘‘better,’’ better meaning not necessarily the highest end of capabilities. If you 

have a really old system, the new system you are buying is almost 

certainly going to be better than the one you are replacing, but it 

may not be the state of the art of the most latest technology. And 

these priorities shift over time. 

And in the Cold War, in most cases, ‘‘better’’ was often the priority. I use in my written testimony the example of the B–2, which 

was innovative in almost every way as it was built and conceived 

and constructed, and that meant that it was expensive. And there 

was a major schedule delay in that program particularly because 

they changed the requirements in the middle of the development. 

And that was a choice that was made because ‘‘better’’ was what 

mattered then. 

In the most recent time period, with the wars in Iraq and Afghanistan, ‘‘faster’’ has certainly been a priority. In my time at the 

Department of Defense, part of which was as director of the Joint 

Rapid Acquisition Cell, was really all about moving faster. And the 

Department achieved quite a bit of success in that, and I will get 

into that, because I think that is something that there are lessons 

learned that we need to take away from that. 

But I do want to mention that in the time that we are in today, 

‘‘faster’’ is not the only priority. We have an erosion of U.S. technical superiority that has been taking place over a number of years 

for a number of reasons, and we explored what some of those reasons are, in a CSIS report released over the summer. 

And that is a case where we do need to be fielding at least some 

systems that are in the ‘‘better’’ category, where ‘‘better’’ is a priority so that we can maintain a technological advantage, which is 

part of our strategy. And also with the budget crisis that is currently being dealt with in the Congress, and maybe there is hopefully some progress being made there, ‘‘cheaper’’ has to be a priority for some systems. So your system has to be able to focus on 

different priorities for different systems at the same time. 

Within my time as director of the Joint Rapid Acquisition Cell, 

we tried to capture the lessons learned from rapid acquisition. This 

was something that really spun up at the Department of Defense 

in the 2005 timeframe. And I came in, in 2013 as director of the 

Joint Rapid Acquisition Cell when we were trying to capture the 

lessons learned and trying to institutionalize those lessons. And 

Secretary Gates in his testimony last week made reference to the 

desire to institutionalize those lessons. 

And I would draw your attention to the article in Foreign Affairs 

Magazine that Dr. Carter published in 2013 which goes into the 

lessons that he took away and how he tried to institutionalize 

those. And I would ask, if you are willing, that that might be made 

part of the record for this hearing, that article. 

[The information referred to can be found in the Appendix on 

page 95.] 

Mr. HUNTER. The keys that we identified at that time, the first 

is flexible funding. By and large, when you are working through 

the Department’s regular budget process, it takes 2 years to get 
4 

money to start. So that is an immediate 2-year delay in the system. 

Now, there are certain ways around that, but they are cumbersome 

and they are difficult, and they make it hard to move fast. 

And the Congress was very generous during the war period of establishing flexible funds like the MRAP [Mine-Resistant Ambush 

Protected] Transfer Funds and the Joint IED [Improvised Explosive Device] Defeat Fund, but those funds are really going away. 

And so exploring how to extend flexible financial support for programs that need to move fast is definitely an area of focus. 

Second big area was getting the senior leadership of the Department involved and shortening the lines of authority, and that was 

really what was called the Warfighter Senior Integration Group 

that the Department did during the war years, and I think that is 

an excellent model for programs that matter to move fast. And that 

model is being somewhat echoed in the Long Range Strike Bomber 

program the Air Force is about to initiate with the way that they 

manage their Rapid Capabilities Office. 

And then the third priority is basically continuous communication between the acquisition community and the operational community about requirements, about testing, about what is acceptable, and about what the art of the possible is with technology, and 

whether that is acceptable to the warfighter. Those three lessons 

are very much applicable to rapid acquisition, but they are applicable more broadly. 

And the last thing I want to leave you with is the idea of adaptable systems. If we are always trying to figure everything out for 

the next 30 years today and plan that all in, that is a real challenge. That is slow. That is just an inherently slow process. 

And so focusing on adaptable systems that can evolve over time 

where you don’t have to have the full answer right when you start 

is a good way. And I would use the Predator system as an example 

of how that has actually happened in practice. And that system has 

evolved in a revolutionary way over time, and that is, I think, an 

example to say. 

Thank you very much, Mr. Chairman. 

[The prepared statement of Mr. Hunter can be found in the Appendix on page 47.] 

The CHAIRMAN. Thank you. 

Dr. Chu, welcome back to the committee. 

STATEMENT OF DAVID S.C. CHU, PRESIDENT, INSTITUTE FOR 

DEFENSE ANALYSES 

Dr. CHU. Thank you, Mr. Chairman. I appreciate the opportunity 

to be part of the panel this morning. 

Let me try to summarize my written statement under three 

headings: First, what do we know about cycle time defined as the 

time from the start of a program until initial operational capability 

is achieved; second, to the extent there are issues with cycle time, 

what are they; and third, what can we do about those issues. 

Looking at the Selected Acquisition Report data of the last 25, 

30 years, I do not see any trend in the cycle time. Cycle time has 

been relatively stable, 8 to 9 years over that period. Our impression 

is very different, perhaps because some very large programs have 
5 

taken a long time: F–22, V–22, and F–35, which, of course, is not 

completely finished with its development program. 

To the extent that there is dissatisfaction with cycle time, I think 

a good deal of the source lies in the definition of the program at 

the start, what people like to call the requirements process, a term 

I actually would urge we drop. Because, in fact, we are always 

picking a point in the space of trades among the various features 

of the system concerned. 

And our real interest ought to be how well the system performs 

against the mission needs for those in the field who are going to 

get it. Too often, from a technical perspective, looking back at history, we pick a point in the trade space that is too tough to achieve 

from a technological perspective within the timeframe that we 

might desire. 

And that tendency is exacerbated, I would argue, by the incentives facing those responsible for the system, starting with the program manager. We reward program managers for getting programs 

to production, not for helping the system make a good decision, 

which in some cases, is to admit we have made a mistake and the 

program ought to end. 

The services, likewise eager to have as much content within the 

fiscal guidance as they can possibly achieve, tend to plan for more 

than can actually be financed. And the companies look to production for the source of their return on capital have every incentive 

to be optimistic about development time and development needs. 

If those are the sources of our dissatisfaction, what can we do 

about them? First and foremost, I think at the start we ought to 

take what some of my colleagues have called a physics-based approach to setting the technical parameters. What does the trade 

space look like? What point within that trade space do we want to 

select? 

Second, as Mr. Hunter suggested, as one of my colleagues has 

phrased a bit edgily, we should prepare to be wrong. We should 

build systems knowing—especially the major platforms—knowing 

that we are likely to want to change them to aim at block upgrades 

across their lifetime, that means allowing for extra space, weight, 

power, et cetera, in the original design. 

To be sure that we have picked the parameters thoughtfully, I 

think greater emphasis on development testing is essential. The 

Department System Acquisition Reform Act of 2009 called for that, 

and the fiscal year 2016 National Defense Authorization Act 

strengthens those provisions. 

And finally, I think we ought to rethink the incentives that face 

the program managers and the services as well as the companies 

that produce the articles to emphasize, much as Intel does, as I understand it, that really the rewards are to go to those who give 

good advice, and sometimes that advice is the program is not meritorious, that not every program started ought to go to a finish. 

Let me offer three observations very briefly in conclusion. First, 

I think the emphasis I would urge is less on whether or not we 

shorten the cycle time and more on understanding how do we pick 

the best cycle time for the need that we face. In some cases, we 

want an article urgently, we are willing to give up certain elements 

of performance in order to get that, or certain elements of long life 
6 

that we would otherwise seek. MRAP is an excellent case in point. 

MRAP was achieved fairly rapidly, but was an article we decided 

not to retain, and we discarded approximately $40 billion worth of 

equipment. Some additional bias for flexibility will be helpful in 

shortening cycle times for those articles we want quickly. 

Second, I think it is essential to keep our focus on mission performance as the ultimate standard, not on the technical parameters 

per se. It is the mission needs that are crucial. That includes, of 

course, deployment deadlines when those are significant. 

And finally, as Secretary Gates’ testimony, I would argue, last 

week at the Senate Armed Services Committee contended, perhaps 

the most important ingredient in success is the human capital, the 

quality of the people managing the system and the technical staff 

that support them, an issue, I think, that the National Defense Authorization Act for this fiscal year recognizes. 

Thank you, Mr. Chairman. 

[The prepared statement of Dr. Chu can be found in the Appendix on page 60.] 

The CHAIRMAN. Thank you. 

Mr. Pasqua. 

STATEMENT OF JOE PASQUA, MEMBER, BUSINESS 

EXECUTIVES FOR NATIONAL SECURITY 

Mr. PASQUA. Chairman Thornberry, members of the committee, 

my name is Joe Pasqua, and I am honored to be here today as a 

private citizen to address you. 

Having been asked for ways to address shortening of the defense 

acquisition cycle, my statement today will focus on how the private 

sector has addressed similar challenges and increased their ability 

to adopt innovation quickly. 

My testimony is based on over three decades in the information 

technology, the IT industry, and also as a member of BENS, Business Executives for National Security, which is a nonprofit, nonpartisan organization that for over 30 years has been a conduit 

through which private sector leaders can help build a more secure 

America. Although the opinions I am going to express today are 

largely reflective of BENS’s perspectives, the views I express are 

my own. 

I would first like to commend the committee’s efforts at acquisition reform. I agree with Chairman Thornberry’s approach to make 

incremental and achievable changes as a path to comprehensive reform. Because of the central role of IT in virtually all modern systems, the ability to efficiently specify, acquire, and adopt IT innovation has become a key success factor. Smaller, more agile companies are often the best sources of innovation; however, they can 

often be the most difficult to identify and engage with for large organizations. 

In the past, barriers for both the Department and these small 

companies have impeded building effective relationships. Traditionally smaller companies haven’t viewed DOD [Department of Defense] as a viable customer because they lack the specialized 

knowledge and the time that is required for operating in this space. 

It is not that they don’t want to engage with DOD; it is just that 

it is too high a risk for these still small businesses. 
7 

So the question becomes, how are private sector companies addressing similar challenges? Over the last 5 to 7 years, there has 

been a fundamental change in the way that they specify and acquire IT. The rapid pace of innovation has made long, expensive requirements processes untenable. As a result, we are seeing less of 

what I referred to as ‘‘big bang’’ acquisitions; instead, companies 

are starting small, conducting iterative evaluations in real time, 

and adjusting as needed. Advances in cloud computing, scale-out 

architectures, and other technologies have enabled companies to 

test concepts quickly and purchase IT hardware as they need it 

rather than buying everything upfront. 

This has been a challenge, quite frankly, for large organizations 

with high inertia and low risk thresholds. But even with these 

larger organizations, we are seeing that they are becoming more 

agile as a way to keep pace in a competitive marketplace. This shift 

has lessened the bias towards large, incumbent vendors and has 

given innovative new players a better opportunity to compete. 

This new approach also helps to remove risk by keeping the initial investments small. Traditional requirements processes attempt 

to mitigate risk by conducting long-term, expensive studies to ensure all options, every conceivable outcome can be reviewed in advance of a decision. In contrast, an agile approach allows companies to start small and scale up as appropriate, thereby reducing 

the need for protracted requirements processes. 

In fact, a traditional process has a different sort of risk, the risk 

that by the time a long acquisition process is complete, the solution 

that is chosen will no longer be appropriate. Nowhere is this more 

true in cyberspace where the threat landscape is changing on a 

continuous basis. In such a dynamic space, the requirements process needs to account for an organization’s current needs and be 

able to adapt to the inevitable changes that will come. This is one 

reason why open architecture is so important. It provides increased 

interoperability, modularity, and the ability to incorporate new 

technologies without overhauling an entire system. 

In summary, I believe that these practices and understanding 

and implementing these approaches would help the Department to 

become more agile and responsive to innovation, allow a slightly 

different, yet still very good risk mitigation strategy, and encourage 

participation from a wider segment of industry. 

Thank you for the opportunity to speak today, and I am prepared 

to answer any questions you may have. 

[The prepared statement of Mr. Pasqua can be found in the Appendix on page 71.] 

The CHAIRMAN. Thank you. 

Mr. Francis. 

STATEMENT OF PAUL L. FRANCIS, MANAGING DIRECTOR, ACQUISITION AND SOURCING MANAGEMENT, U.S. GOVERNMENT ACCOUNTABILITY OFFICE 

Mr. FRANCIS. Good morning, Mr. Chairman, Mrs. Davis, members of the committee. I appreciate the opportunity to talk about 

weapons system acquisition this morning. 

I think we know the overall problems being, weapons systems 

cost more and they take longer than expected. They perform well 
8 

but generally not quite as well as we thought. I believe some of the 

top-level consequences are understood, that is the warfighter is 

somewhat underserved by systems that come late and buying 

power is reduced. 

There are other consequences maybe that are less well understood; that is, when we pay more for a weapons system than we 

thought that we would in the beginning, we are making tradeoffs. 

We are deciding not to do other things because we are putting 

more money into this one system. And those opportunity costs I 

don’t think are explicit or the tradeoffs are looked at, so we are not 

quite sure what we are giving up to put more money into system 

A. 

The other thing is, weapons systems typically take more to operate and support than we think. They are a little less reliable. 

Again, those costs are kind of hidden once the acquisition is done. 

So, some consequences not so clear. 

Our position is that the key to getting better acquisition outcomes, whether they are shorter cycle times, or as Dr. Chu mentioned, the right cycle times, is a better business case at milestone 

B. And I will talk about a business case in two parts: One is, what 

happens before milestone B. And that is when you are sending requirements and you really need your requirements to be—they 

need to be clear, flexible, but well informed by a couple of things: 

One is technology knowledge. How much technology is available to 

meet the requirement; and your engineering expertise. Do you understand the implications of the requirement for the design? 

So if you come to a milestone B and you are asking for technologies that aren’t mature yet, or you don’t quite understand the 

implications for the design, you are in trouble. If you do come to 

milestone B with a pretty well-informed, reasonable set of requirements then you are kind of ready for the second half. And the second half of that is, what is your game plan going forward. 

And we would say the second part of that business case then is 

a knowledge-based acquisition strategy that lays out a logical path 

for getting the design stable, building prototypes, testing, maturing 

the design, maturing production processes, and laying that out 

with the schedule and resources that allow that to be done nonconcurrently. 

So, you ask yourself, well, why aren’t we getting these kind of 

business cases routinely? Which is the David Packard question. We 

all know what needs to be done; the question is, why don’t we do 

it? And I would say what I just described is a sound business case, 

but a sound business case isn’t the same as a successful business 

case. And a successful business case is one that wins money. 

And I still think predominantly in the Department, a successful 

business case is one that overstates or overpromises performance 

and understates cost and understates schedule. That is what still 

wins money today. And I would say the reason for that is there is 

still strong incentives, which we refer to as the acquisition culture 

in the Department, that put pressure on these kind of business 

cases. 

And I will give you a couple examples of what is kind of under 

the hood. First is the competition for funds in the Pentagon is pretty intense to start a new program, so that does create incentives 
9 

to overpromise performance and understate the investment cost. 

Also, weapons systems are highly symbolic. They are more than 

just a piece of equipment at the right price. They involve policies, 

roles and missions, careers, jobs, budget shares, so they carry a lot 

of weight. 

If you look at the private sector, when the private sector does a 

product development, it is an expense. They are spending their own 

money to finance the development and they don’t make any money 

until they get into production. So that creates real incentives to get 

the business case right, because if they are late, the customer 

walks. If you are Ford and you build a Ford Taurus that is 5 years 

late, it has a $50,000 sticker price and it gets bad gas mileage, 

your customer walks, and the investment is lost. 

And the Department of Defense, when you get a program started, 

it is a revenue stream. It is not an expense. So you get a bigger 

budget share. And those incentives then are quite different. And at 

the end, the customer isn’t going to walk. So if it costs too much, 

it takes longer, it underperforms, the customer is still going to buy. 

So in the private sector, the point of sale is after development 

when you are in production. In the Department of Defense, the 

point of sale is at milestone B. In fact, I would say it is before milestone B when you first approve funding. So it is a completely different psychology. 

That is why things like—practices like cost estimating, everyone 

wants—or you would say policy says we should have good cost estimates. We all know how to do a good cost estimate. But they don’t 

really help your business case. They are pretty inconvenient if they 

are high. Same is true for a fly-before-buy in testing. You would 

want early test results to see how good the system is, but they 

could be inconvenient as well. 

So I think the real kicker is, to the extent business cases like 

this win funding approval they are sanctioned, and those principles 

then become what policy is, not what is in best practices or DOD 

policy. 

So what to do, I would just say let’s start thinking about the acquisition process as not something that is broken but something 

that is held in equilibrium by a set of incentives that are stronger 

than best practices. You know, moving forward there is a number 

of things we can do, we will probably talk about that more this 

morning, but it is going to take joint action on the part of the DOD 

and Congress. 

And I will just list a few things. One is we need to separate technology development from product development; we need to take 

risks in the right places, which I would say is early in programs; 

and if we have to take a risk on a program after milestone B, let’s 

declare them and pay for them. Let’s take the risk together and be 

honest about them. 

We have to do something about better aligning funding decisions 

with program decisions, because today you are having to make a 

funding decision 18 months in advance of a program decision. So 

once you put money on the table you can’t take it off. We really 

need, as Dr. Chu mentioned, a really good investment in program 

managers and systems engineering staff. 
10 

And then finally, I would say my hope, my appeal is to Congress 

to be the game changer in acquisition reform and that will be 

manifested by what you do in funding programs. So I would say for 

programs that don’t measure up to good business cases, say no. I 

think a couple of good no’s in the process from the Congress is 

going to send the right example as to what you expect. 

So that is my hope. I am looking for you to be the game changers. Thank you, Mr. Chairman. 

[The prepared statement of Mr. Francis can be found in the Appendix on page 79.] 

The CHAIRMAN. Thank you. 

I just want to ask each of you to comment, because each of you 

have touched on this in the comments that you have made so far. 

And one of the concerns that I have heard over and over is, especially for complex systems, we invent as we are in production. Dr. 

Chu said we reward programs for getting into production. Mr. 

Francis was just talking about this. So the incentive of the current 

system is to get that program past the milestone B, that is where 

you get the dedicated line of funding, and the incentive is to do 

that even if the technology has not been developed that you are 

going to rely upon. 

And so, part of what happens is you are inventing as you are 

producing, and that results in delays, cost overruns, and so forth. 

So the suggestion has been made to me that if you separate technology development from production and you don’t take anything 

to production until the technology is established and proven, that 

maybe you could improve that situation with the adaptability that 

you all talked about so that as improvements in technology are developed, then you can plug it in. 

So Mr. Hunter, what is your reaction to that? I mean, part of 

what we are trying to do is get below the symptoms, the surface 

here, and dig down into deeper root causes that have caused people 

concern. Is this a root cause, and is that something that together 

we should explore with the Pentagon? 

Mr. HUNTER. Well, I would say it can be a root cause and that 

does happen. And the example that jumped into my mind as you 

were laying that out is the example of the F–35 helmet, which I 

would say was not mature technology in the early 2000s when the 

program went through milestone B and the investment decision 

was made and the decision to take that approach was made, but 

which is now actually working. 

And so some 15 years later it is there but it probably wasn’t 

there when we made the decision. So it does happen. It is a cause. 

It is not the only root cause but it is a cause. One note I would 

make about that and something they did there that actually was 

a good idea, although I think it was belated, is they had an off 

ramp and they had a second helmet that they could have gone with 

if the original helmet didn’t work. And that, I think, is a good practice. 

There are times when you want to reach a little bit, as I mentioned when ‘‘better’’ is the priority. It is not clear that on F–35 

that was really the intent, but where it is a priority you may want 

to reach. But what you can do is have off ramps, so that if you are 

not able to invent the thing you were trying to invent, you still 
11 

have a workable system and it still meets your threshold requirements. 

And I also think, you know, as I mentioned this idea of adaptable 

systems to where you may be trying to invent something, but 

again, you don’t put it in the baseline design. It is in a later block. 

It can be a way when you are trying to reach for new and innovative technology. 

The CHAIRMAN. Dr. Chu. 

Dr. CHU. I would add two thoughts to the general idea that you 

advanced. One, reinforcing, which is there in various congressional 

direction the last several years, and that is a greater emphasis on 

development testing. We don’t do enough testing early on of the 

technology ideas to be sure that they are going to pay off in the 

way we think. 

Second, I think, again, back to deemphasizing the word ‘‘requirements,’’ too often we pick a technological point and we follow these 

attributes forgetting that in the end what counts is does it add to 

mission success or not. And there are a number of systems where 

we have picked points that actually don’t have a lot to do with mission success but we keep pursuing them in the systems development even though they are not going to have a high payoff, and 

that often is the cause of serious difficulty. 

The CHAIRMAN. Okay. Mr. Pasqua, I want to come back to you 

in a second with the private sector. 

Mr. Francis, what do you think? 

Mr. FRANCIS. I think it is definitely one of the big root causes. 

I think part of the solution lies in the fact that we have to enable 

those technologies, so we do have to take those risks to make those 

gains. So we are not arguing against that, but the burden needs 

to be borne more heavily in the science and technology community. 

And we typically aren’t funding it to carry technologies that far. 

And the mechanisms we have to transition technologies to programs aren’t very good. So programs are a better place, if you will, 

to fund the programs, which is not what we want. I also think 

when programs are doing their analysis of alternatives, there is incentives to advertise very high performance, which means you are 

counting on technologies that haven’t been invented yet. 

So I think we can go forward, bring technologies to higher level 

before milestone B. If we still have to take risks, let’s take the risks 

and pay for them upfront. Or, as I think Mr. Hunter was suggesting, go forward with the design that is flexible enough that you 

can bring in improvements in technologies during the course of development. 

The CHAIRMAN. Okay. Now, Mr. Pasqua, how does all this comport with your experience in the private sector? And is this, kind 

of what we have just been talking about, a path towards a more 

agile system, in your opinion? 

Mr. PASQUA. I think it translates very well to the private sector, 

particularly with technology. It is sort of well understood that the 

further on you get into a technology development cycle, the costs 

of changes and finding and fixing problems increases close to exponentially. 

So you want to make sure that you are doing as much cycle work 

as you can upfront to get your technology in place and in a mode 
12 

where it is operable, it can be adapted and modularized, but you 

don’t want to be making changes during the production cycle, you 

don’t want to be redoing the architecture during the production 

cycle. That is the absolutely most expensive time to deal with those 

types of issues. 

So the idea of being more agile upfront, being able to test systems before they are in production, before you get into the most expensive phase for changes, is, I would say, an industry best practice. 

The CHAIRMAN. Thank you. Thank you, all. 

Mrs. Davis. 

Mrs. DAVIS. Thank you. Thank you, Mr. Chairman. 

And I appreciate all of your input here. 

I think one of my questions, and perhaps both in business and 

in the Department, the extent to which we rely on people who have 

done those things before, and with the idea that they will be able 

to move forward, you know, do you see in business particularly putting folks on the project who maybe haven’t been there before? I 

mean, is there something to be said for we really do need in management to bring in—talk about different eyes on the issue. Do you 

see that happening in the business, that you are able to do that 

more than perhaps in the public sector? 

Mr. PASQUA. Well, I can’t compare to the public sector because 

I can’t speak with authority on how often that happens, but it is 

definitely the case that having a fresh perspective is always a good 

thing. But having people who have—are experienced with the process and know how the process works and can operate efficiently in 

it, I think, is very important. 

I think what we are seeing in industry is sort of a bridge being 

built between the people and the way processes had operated for 

many, many years, and a transition to the way they are operating 

now. And I think part of the way that is happening, particularly 

in large organizations, is they are looking at smaller organizations 

and wondering how these smaller organizations are so much more 

effective than they are, and trying to understand which sorts of 

processes can be adapted from those sort of more agile companies 

into a larger organization. 

It is not easy, frankly. The things that work in a smaller organization often don’t translate directly to a larger organization. But as 

Dr. Chu was saying, I think that one of the critical things is always 

keeping in mind what the end goal is. 

So as organizations are focusing on not what’s written in a document somewhere about, you know, specific sets of requirements but 

actually what they are trying to achieve in the marketplace or for 

their customers or for their patients or clients and being able to adjust based on that north star of what the actual goals of the 

projects are rather than specifically the detailed requirements is 

one thing that I think is changing industry in a positive way. 

Mrs. DAVIS. Uh-huh, yeah. I don’t know, Dr. Chu or even Mr. 

Francis, does sometimes just the culture get in the way of that? 

Dr. CHU. I think there is an issue there with the human capital, 

and that is that as the number of new systems has declined over 

the last several decades in at least several platform areas, private 

aircraft being a principal example, it is less the case as was earlier 
13 

true that the design engineers have prior experience with that design problem. 

And so we move from a situation where United States and let’s 

say the 1950s, 1960s science engineers have frequent opportunities 

to try out new design ideas and experience with the ups and downs 

of that process to—they may do one or two designs in an entire career. 

And so that base of hard-won lessons from things that didn’t go 

so well is not as frequently there, and I think that is one of the 

issues out there. I think that does lead to a different kind of technology separation production, which is perhaps more emphasis on 

prototypes and prototypes for their own sake, to try out technologies and to give the design teams more experience with the 

tough issue of how you actually make these trades work. 

Mrs. DAVIS. Thank you. 

Mr. Francis, is the reason that we tend to build on immature 

technologies that there hasn’t been this sort of change in terms of 

looking at something, I guess, different from what they have done 

in the past? How would you solve that, I guess? 

Mr. FRANCIS. Well, I think that is part of the problem. I think 

the issue with program managers is a real one. I think we are putting really outstanding people in those positions, but we are often 

handing them an impossible situation. So we hand them a business 

case that no one could execute. 

We are not really giving them the training and glide path to put 

them in a position and really have the business acumen to do business with their private sector counterparts. And then we are not 

giving them a really good career path. So we don’t put program 

managers in a good position to succeed, so that is a remedy that 

we need. 

The other part, touching on your technology, is we are still short 

on systems engineers in the Department, and we particularly need 

that expertise before a milestone B decision so that you can work 

with those requirements and understand the preliminary design. 

So I think the work doesn’t get done early, it falls on the shoulders 

of the PM [program manager], and the PM is not well equipped to 

handle it. 

Mrs. DAVIS. Thank you. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Mr. Forbes. 

Mr. FORBES. Mr. Chairman, first of all, I want to thank you for 

your work in this area. You have done a lot to move this forward 

and this hearing is one of those things. 

And our committee is always—we spend some time in the weeds 

looking at the specificity of what we need to do and then we move 

up and get kind of an aerial view. There are times we need to do 

the aerial because it shows us the trajectory and the curve lines 

that we have. 

When Eisenhower left office in 1961, he warned of the influence 

of a permanent armaments industry of vast proportions. But in the 

years of the Cold War, we have seen the size of our industrial base 

shrink along with defense spending. 1961 defense contractors comprised 15 of the top 100 companies in America and made 30 percent of those top 100 companies’ total revenue. Today, there are 
14 

only 4 defense contractors in the top 100 and they make 4 percent 

of the total revenue. 

Now, I know that is in part due to mergers and acquisitions and 

also tremendous growth in the commercial sector. But unfortunately for our national defense many of the commercial companies 

are hesitant to work with the DOD due to low profit margins, huge 

regulatory burdens, and demands that they turn over intellectual 

property. 

Could you guys give us your opinion of the curve lines that you 

see that worry you about the industrial base and the acquisition 

process in terms of the health of our industrial base and its ability 

to meet the needs of our military, and also the flexibility that we 

might have. You know, we all talk about often in World War II how 

we could shift our manufacturing and produce other things. What 

worries you today about those curve lines, and is there anything 

we can do as a Congress to impact the curve lines? 

Mr. Hunter, do you mind giving us your thoughts. 

Mr. HUNTER. Yes. I would say if you step back and take the total 

aerial view, on the whole I would say the industrial base is actually 

still pretty healthy today. Where I get concerned is where that defense industrial base becomes very much divorced from the commercial side. And an example I would give is shipbuilding, right. 

The commercial shipbuilding industry in this country is gone essentially. There is a little sliver of it left out in California, but by 

and large it is gone. 

And so all of the shipbuilding, all of the expense, all of the overhead of what is an expensive industry is carried by the Department 

of Defense. And that is why the Navy works so assiduously to try 

and take care of that industrial base which is certainly an excellent 

thing that the Navy does. On the aviation side, it has been much 

more tightly integrated both in terms of airframes and engines. 

Now, that may also be starting to separate a bit, and so I do 

have some concerns that if the aviation side of the industrial base 

goes in the direction that shipbuilding has gone and we get this 

separation between the commercial aviation industrial base and 

the defense aviation industrial base, that could have real consequences. The decision by the United Technologies to sell Sikorsky 

does raise some concerns in that area. And that was not because 

the business was going away; it was more a decision about profitability. But that is a concern. 

Mr. FORBES. Anybody else have a thought? 

Dr. CHU. Sir, what I would worry about most is the lack of competition, the consolidation that you mentioned. You look at history 

of fighter aircraft since World War II in the early decades, I think 

the historians would argue the interesting innovations came from 

the firms that lost the last competition because they realized if 

they didn’t come up with a new idea they would not be around 

much longer. That is no longer a threat to the major suppliers. 

Coupled with, as you hinted, and as Mr. Pasqua’s testimony 

underscored, a set of Federal procurement rules make it very difficult for a truly commercial firm to do business with a fellow company. So what you have is basically a firm that specialized in defense procurement or subsets of firms, such as the Boeing division 

between military and civil aviation that specialize in defense pro-
15 

curement. And again that limits the degree of competition, most 

importantly competition about new ideas. 

Mr. FORBES. Okay. Any other thoughts? 

Mr. FRANCIS. Mr. Forbes, I think obviously competition is a big 

issue. And so as there has been contraction, there has been less 

competition, and I think we have come through an era of really big 

platforms which made winners and losers out of industry. So if you 

didn’t get on the next new platform, you were out of business. I 

think we are a little past that right now and so there is not as 

much big, new platforms coming. So I have some hope. 

I think the other thing is, there are barriers, I think, that can 

be reduced for the government to attract more innovative commercial firms to do business. That may be kind of limited. I think the 

government also has to instead adapt to the fact that the private 

sector is funding so much more research and development. So the 

government has got to learn to adapt to that. 

Mr. FORBES. And my time is up, but thank you, gentlemen. 

I would yield back, Mr. Chairman. 

The CHAIRMAN. Thank you. 

Mr. Walz. 

Mr. WALZ. Thank you, Mr. Chairman. And I too want to echo my 

thanks for you grabbing onto this issue we all know is critically important in working in. Thank you all for being here. 

Just a couple questions, and I am interested amongst the different services and the performance amongst them because there 

appears to be a difference, if there is some lessons learned or if it 

is the nature of the service. This idea of breaches going through the 

cost ceiling’s scheduled performance or whatever. I started looking 

at this. 

While this pains me to say as a former soldier, the Army leads 

in this area with a 38 percent breach. I am kind of curious, from 

your perspectives, is this cultural? Is it the nature of it? Or what 

is at work there that would set them apart from the Air Force and 

the Navy? 

Mr. FRANCIS. That is a tough question. I think the Army, you 

know, after the Big Five programs of the late 1970s and the early 

1980s, has had a difficult time finding traction with aviation and 

its ground combat vehicles and came through a very difficult phase 

with the Future Combat Systems, where it was coming up with a 

completely different concept for fighting. And I think that was 

doomed by relying on technologies that simply weren’t there and 

they just couldn’t execute that. 

I don’t know that the Army is quite recovered from that. After 

the Future Combat Systems, which is predicated on fielding an 

array of 19-ton vehicles that could be airlifted, the next vehicle that 

the Army developed was the ground combat vehicle which was a 

70-ton vehicle. So I think the Army has had some difficulty trying 

to identify just what it needs and how it wants to fight. 

And when it decides on something it has been moving out a little 

bit too aggressively, trying to get it fast and discovers during the 

process that it is not a good concept. So I have seen that more with 

the Army than the other services. 

Mr. WALZ. Yes, sir. 
16 

Mr. HUNTER. I would agree with that largely. I think that—and 

the essential point that—with the Army not having recovered from 

Future Combat System [FCS], I think the issue is that they don’t 

have a consensus vision within the Army of what the next Army 

should look like. You know, the 1980s, they had the Big Five and 

that was a pretty consensus vision. And because there were five of 

them and within that there were a number of subsystems, it essentially—every part of the Army was winning or was getting something out of that approach. And since the collapse of FCS, there 

has been no similar vision for how to move forward. 

Mr. WALZ. That lack of vision, is that what led to like Crusader? 

I always look at that, is that the problem with the acquisition process, or did we actually see a glimmer of hope that it was actually 

killed after a while? I am kind of curious on that. Is that just part 

of this culture, they are searching for the weapon system that 

didn’t fit the battle that was coming? 

Mr. HUNTER. I would say Crusader is an example of a case where 

there was a vision but it was not an affordable vision. And so that 

is another obviously possible failure mode is you can have a great 

vision but it tends, you know—— 

Mr. WALZ. So this is a leadership issue then, is the way you see 

it amongst the Army or at least vision-wise. It leads me into my 

next question about we included the service chiefs having a say in 

this in the NDAA. And again, this might be the chip on my shoulder or whatever, is it important to add those senior-enlisted people? 

I would say they are closer to the end user type of thing. Does that 

start to straighten this mission out, or is that a whole different discussion? 

Mr. HUNTER. Well, where I see the strength of having the service 

chiefs more involved is their ability to bring all the elements of the 

game together, budgets, requirements, and acquisition. And I think 

there is a lot of power in that. And they are at the top of those 

pyramids. And so I think that is the real strength that they have 

to offer. They by and large don’t bring to the table a lot of technical 

expertise to address some of these technical issues because that is 

not their training. It is not expected that they should have that. 

So I think on terms of the enlisted side, to the extent that the senior leadership there can, again, help to bring the aspects of the system together, that is a good thing. 

Dr. CHU. If I may add, sir, I think on the end user front, the end 

users you may most want to encourage to say more are the combatant commanders. They are after all the one responsible forces—at 

whatever level, enlisted—officer. And they don’t have too large a 

voice in the present system. 

Mr. WALZ. Great. I appreciate that. And again thank you for 

helping us understand this. I think all of us here do recognize this 

is a critical issue. And at some point in time we are going to have 

to—and I think the chairman is right again on this: We would like 

to fix it all. That is not going to happen realistically, but these 

steps forward do make a difference. So thank you and I yield back. 

The CHAIRMAN. Mr. Rogers. 

Mr. ROGERS. Thank you, Mr. Chairman. 

I will throw this out for whoever wants to swing at it. Do you 

believe there is a bias in DOD goods and services procurement 
17 

against public/private partnerships? For example, does it make 

sense for OMB [Office of Management and Budget] and CBO [Congressional Budget Office] to require 1-year scoring of the entire liability of a public/private partnership but not the same treatment 

for traditional goods and services government to contractor procurement? Dr. Chu. 

Dr. CHU. This question of scoring multiyear buys, particularly if 

they have a lease-type structure, which is what you are describing, 

I think is one that has bedeviled the Department. Congress, to 

point to a positive example, offered a way out for privatized housing and special provisions. 

And so on the one hand, I understand the source of the constraint, which is to avoid signing long-term leases and dodging the 

fiscal limits; on the other hand, I think it has proven injurious to 

some arrangements that might indeed be interesting, and I would 

look to some provision, perhaps modeled on the privatized housing 

authority that allows meritorious multiyear deals to go through. 

Mr. ROGERS. Mr. Hunter. 

Mr. HUNTER. I would just say, my point about financial flexibility 

is exactly aimed at what you are talking about, which is the tendency within the system to shut down innovative financial approach 

because of scoring issues or legal issues or other impediments that 

have been brought in over the years, usually because of a bad case 

that happened somewhere in time and then we foreclosed an entire 

range of options. And multiyear funding is certainly an aspect of 

that, acquiring material through services is something that can be 

very powerful but is very hard to do in the current system. 

Mr. ROGERS. Yeah, and housing was the example I was going to 

go to. It has been a stellar success. And you know, we are going 

to own it at the end of this 50-year lease/purchase agreement. It 

has been a win-win. But we run into these same problems with our 

satellite access. We would like to have multiyear deals where we 

could get a lower rate, and we are locked into the 1-year scoring, 

which is just a killer for us. 

And another area where I would like to see this done is I would 

like to take the same model that we use for housing to re-engine 

the B–52 bombers. We could pay for that, in my view, with the fuel 

savings, but we would get into the scoring issue again. So I am real 

interested in your thoughts about how to get around that. 

Let me ask this: There are going to be some areas where it 

doesn’t make sense to treat goods and services as a commercial 

item where DOD can afford to rely on the market to influence positive private sector decisions. Is the space launch one of these? 

And as you know, we historically have a situation where Lockheed and Boeing were in the space launch business and couldn’t 

make a profit, and decided to get out and we went, no, don’t do 

that. You all get together and put together a partnership called 

ULA [United Launch Alliance], and we will feed you enough business to keep you alive. And now we are being attacked—or that 

model is being attacked, as you know. 

And I am just wondering, can we rely on commercial enterprises 

for essential national security access to space? Anybody want to 

take a swing at that? 
18 

Mr. FRANCIS. So Mr. Rogers, I know when ULA was formed it 

was formed on the basis of they thought there was going to be a 

big commercial market. So what they were going to do for the Department they thought they were going to be able to adapt to the 

commercial market and that market did not materialize. So they 

became more dependent on DOD. 

Now we have opened that up to commercial competition so we 

have commercial firms that are competing. We still have ULA, as 

one of the competitors now. 

Mr. ROGERS. Well, we have got ULA for the moment. 

Mr. FRANCIS. For the moment, right. 

Mr. ROGERS. That may not be there by December 1. That is the 

whole point. 

Mr. FRANCIS. Right. So I think it depends on how good these 

commercial offerings are. Can their rockets—right now at this 

point we are trying to see whether they can handle those payloads 

and be reliable. And will there be a commercial market. So if the 

government is the only customer, it is hard to imagine you can 

have all of these suppliers. So it is going to depend on, I think, 

largely on the commercial market, and the government is going to 

have to protect its interest going forward. 

Mr. ROGERS. The last statement you made is the key: ‘‘The government has to protect its interest.’’ We have to, from a national 

security standpoint, have assured access to space, which by DOD 

definition means two sources. We are going to be doing good to 

keep one at the rate things are going. 

But let me ask you this: Mr. Francis, you have recommended 

that, quote, ‘‘stronger and more uniform incentives are needed to 

encourage the development of technologies in the right environment to reduce the cost of later changes, and encourage the technology and acquisition in communities to work more closely together to deliver the right technologies at the right time,’’ closed 

quote. 

You point out that there are organizational, budgetary, and process impediments which make it difficult to bring technologies from 

DOD science and technology enterprise into acquisition programs. 

What are the impediments and how can we change this? 

Mr. FRANCIS. So one thing is the science and technology [S&T] 

budget is relatively fixed. I think if you look over the past 20 years, 

it is about 20 percent of the R&D [research and development] 

budget. I don’t know if that is the right number, but again, it is 

a fixed level of funding. Seems to me, if we are going to get ready 

for a next generation of something that maybe that S&T budget 

needs to be built up. 

It is not big enough now to carry technologies far enough into 

maturity, so you end up having to hand them over to weapons system programs too early because they are the big bank for money. 

And there aren’t really good mechanisms, at least consistent mechanisms right now, for science and technology managers to go into 

a transitional phase where they can work with program offices and 

successfully hand off technologies to those programs. 

So I think there is some structural issues. There is funding, organizational, and then the fact that really it is the acquisition pro-
19 

grams that are more in control of transition than science and technology organizations, which is different from the private sector. 

Mr. ROGERS. Thank you. I yield back. 

The CHAIRMAN. Mr. O’Rourke. 

Mr. O’ROURKE. Mr. Francis, I was very interested by your comments about opportunity costs and that when we have cost and 

time overruns, it is not just money and time in an absolute sense; 

it is the loss of something else that we could have been focusing 

on, spending dollars on, spending time on. I know it is hard to 

quantify a negative, but do you have any examples of what some 

of those opportunity costs were, specific programs? 

Mr. FRANCIS. There are some cases where the tradeoffs were explicit, so I remember, kind of using a reverse example, when the 

Comanche helicopter was cancelled, it freed up money which this 

committee, I think, took the lead on making sure that that money 

went into other Army aviation investments. So that is kind of using 

the negative to illustrate what should happen. 

I don’t really have good examples for when a program overruns 

and you need more money to do it and where did that money come 

from? So programs like the F–22, the Joint Strike Fighter, the 

Ford-class aircraft carrier that have overrun, we have made decisions to put more money into those to buy what we thought we 

were already buying, but I am not aware of where we have listed 

the tradeoffs. What did we give up to provide that extra money? 

Now, I have to believe that exists in the Pentagon, but I don’t know 

if that is a debate that the Congress is afforded. 

Mr. O’ROURKE. You also talked about the fact that we unintentionally incentivized, overpromising on the outcomes and underestimating on the costs, and you suggested that this committee or Congress should send a signal by rejecting some of these programs or 

projects or systems. Do you have any specific examples? 

Mr. FRANCIS. You know, I was thinking about that before I came 

in. I really can’t think of examples where Congress said no. What 

Congress tends to do—— 

Mr. O’ROURKE. Could you think of some examples where Congress should have said no? 

Mr. FRANCIS. Oh, yes. So Future Combat Systems. I give this 

committee a lot of credit for having all the early hearings on Future Combat Systems. It was simply not possible. It didn’t measure 

up to any reasonable test of an executable program. It relied on 50 

uninvented technologies, and it was a $200 billion program, and we 

were going to do it, I think it was 19 separate programs, and were 

going to run all 19 in 5 years, in less time than it takes to run one 

program. It just was not executable. 

What Congress tends to do and what it did in this case was it 

puts strings on the money. It will put a cap. It will put a condition 

that you can’t go forward unless you report back. But it never said 

no to the program, so it took Robert Gates to say no to it. So Congress is reluctant to give a no. It will give an angry yes, but that 

is a yes nonetheless. 

Mr. O’ROURKE. Let me ask you about another topic that you 

brought up, which is the need to take risks earlier in the cycle or 

in the process. Can you expand on that a little bit and talk about 

our role in doing that or in creating the incentives for that? 
20 

Mr. FRANCIS. Sure. And Dr. Chu, his statement covers that as 

well. We need to take risks. So we don’t want a situation where 

we don’t take any risks and we never have any failures. You have 

to take risks. We are not going to have perfection here. Perfection 

I think would be a bad thing, but we can do better. We need to 

take those risks in science and technology. That provides the environment where failure is okay. 

So the purpose of S&T is to discover. But once you get into product development, the purpose of product development is to deliver, 

and you can’t invent on a schedule. So I would say we have to take 

those risks in science and technology and carry those risks further 

and resolve them. And if we can’t, then we make an eyes-open decision that we are not going to take the risks in product development, and so we are going to take those out of the requirements; 

or we are going to take the risks but we are going to have to put 

the money up to take them. 

So too often we say we are going to take these risks, but we have 

a risk mitigation plan in place that is going to make it okay. But 

that risk mitigation plan generally lacks two things, time and 

money, which are the consequences most likely to attend risk. 

Mr. O’ROURKE. Thank you. Mr. Chairman, I yield back. 

Mr. HUNTER. Can I just add one thing to that? And I agree with 

what Paul has said, but there still needs to be path for that S&T 

to get into the arsenal. And that is where I would again mention 

this idea of adaptable systems, so when you do prove something out 

in the S&T or early stage R&D, you need a way to host it on a platform that the warfighter actually uses, so you have to make that 

connection. 

Mr. O’ROURKE. Thanks. 

The CHAIRMAN. Mr. Wittman. 

Mr. WITTMAN. Thank you, Mr. Chairman. Gentlemen, thank you 

for joining us today. I want to talk about how things happen within 

the decisionmaking process on acquisition, and you pointed out 

some success models at the smaller scale where you can take a concept that comes from unit commanders. You develop that process 

of developing that idea with systems engineers, and you have program managers involved and contracting officers, and you end up 

with something that works and resembles what was needed at the 

very beginning. So that small-scale process you have shown works. 

Let me ask this. How do we take that and graduate it to the 

large scale? How do we take emerging technology, compress the 

time process, be able to make sure that we have great communications from the unit commanders, to the systems engineers, to the 

program managers, to the contracting professionals, and getting 

that done? 

It seems like to me today what we have is we have the unit commanders that are here, and then in a whole separate element there 

is the systems engineers that take that concept and develop it, and 

then in a separate place, in another area, are the folks that write 

the requirements, and then another group of folks that come up 

with the proposals and another group of folks that come up with 

the contracting process, so all of this is fragmented, and no wonder 

decision making goes awry, especially when it seems to be processdriven. People seem to be I got to check the box. And if I check the 
21 

box, then I have done my job. Instead of saying, you know, let’s 

focus on what the warfighter needs. Let’s focus on getting that 

technology to them as quickly as we can. How do we do that? 

How do we put authority into the hands of those people at every 

point in the process? How do we bring the decision making together? And how do we make sure that we also have accountability 

there so we don’t go awry, or if we do go awry, we can either get 

things back on track or stop things immediately? Give me your perspective on how we make those things happen. 

Mr. HUNTER. I try to address this in my testimony. I talked 

about the importance of senior leadership and shortening the lines 

of authority for acquisition. And the model that I would offer is 

what we used for rapid acquisition was the Warfighter Senior Integration Group. And if you could picture it, a giant room, tons of 

people around a table. You have got the acquisition folks there. You 

have got the logistics and sustainment folks there. You have got 

the operators in theatre coming in through VTC [video teleconferencing] who are actually setting the requirements, are going to use 

the equipment. 

Everyone around the table, with the Deputy Secretary of Defense 

there, and the question is not a debate about should we or 

shouldn’t we. We are going to do it. That is the bottom line. And 

everyone who has a role in the system is there, and a decision is 

made. The Deputy Secretary says, here is how we are going to do 

it. Everyone go out. These are the marching orders. 

Mr. WITTMAN. Mr. Hunter, I agree. That is a great concept, but 

that happens occasionally. How do we make that the rule? How do 

we make sure that that is how the acquisition process takes place, 

rather than saying here is a great example about how it works? To 

me it has to become a culture within the organization to make that 

happen. What needs to take place to make sure that that is the 

rule? 

Mr. HUNTER. I would say for programs where faster is your priority, you can make that similar construct work. I believe that will 

be the case for the LRSB [Long Range Strike Bomber] program because you have this Rapid Capabilities Office in the Air Force that 

already works this way. It has a board of directors, very similar to 

what we had at the Warfighter Senior Integration Group. 

Where you have instead of 50 layers between the person in 

charge, Deputy Secretary of Defense or in this case Secretary of the 

Air Force and the Under Secretary for Acquisition, it is three or 

four layers or less. To me that is where the real power of that approach comes. And it can be done. Now can we do it for every acquisition program in the Department? Probably not. 

Mr. WITTMAN. Is this a directive that needs to come from the 

House Armed Services Committee? Is it something that needs to 

come through OSD [Office of the Secretary of Defense]? How do we 

operationalize this? Because we have got a lot of great ideas floating around about how to fix the acquisition process, but the ideas 

never seem to make their way to reality. Tell me where you believe 

the push needs to come from and the determination and concrete 

direction needs to come from to make this happen? 

Mr. HUNTER. Well I would say Congress has done one thing in 

this most recent NDAA—the one that is still pending, I should say, 
22 

after the veto—is to streamline the process. So, you know, there 

are a number of documentation, check-the-box kind of exercises 

that have been imposed over the years, a number of them by the 

Department but a number also by statute and kind of cleaning the 

books of a lot of these things can really help. 

And then, as I mentioned in my testimony, now that many of 

those statutes have been changed, making sure that the Department follows through to actually change the regulations because a 

lot of these things were required by statute. Now they are in the 

regs, and so you have to clean that stuff off the books. And following through to make sure that now that the statute has been 

streamlined, that the regulations are also streamlined is critical. 

Mr. WITTMAN. Thank you, Mr. Chairman. I yield back. 

The CHAIRMAN. Thank you. Mr. Moulton. 

Mr. MOULTON. Thank you, Mr. Chairman. Gentlemen, thank you 

for being here. I just want to echo the chairman’s comments that 

he began with, which were that I think that this is partly about 

conserving taxpayer dollars, which we know is incredibly important, especially in this budgetary environment, but even more importantly it is about responding to the next threats. 

And you know, companies used to succeed in the light bulb industry by trying to be most efficient at making the light bulb for 

the least cost, and now companies succeed in that industry by 

being the quickest to develop the newest type of light bulb, to be 

the quickest into LED [light-emitting diode] technology. I think in 

my long tenure of almost 11 months on the committee, I have been 

a strong advocate of cutting programs that we don’t need and old 

systems and legacy systems so that we can invest that money in 

the new ones, which I think is incredibly important. 

One of the things that we need to do more of, as you have said, 

is be willing to accept the fact that technology development does 

not just occur in the Department of Defense anymore. It occurs outside. And there seems to be a conflict between the desire to get 

more commercial-off-the-shelf technology, and the MIL [military] 

standard requirements that this technology then has to meet. 

And I think about how much more effective I would have been 

as an infantry officer on the battlefield if I could have used an 

iPhone. Now, if I were to get killed because my iPhone didn’t meet 

that 100 percent requirement and failed at some point, there would 

be a lot of grief. But on the other hand, if we don’t allow the iPhone 

on the battlefield for years because it can’t meet that 100 percent 

requirement, a lot of people are going to die. And you might not 

see the news stories about it, but it will be a loss as well. So how 

do you think about better managing that conflict? 

Mr. PASQUA. I think that is incredibly important, and to the earlier point about sort of what worries us in the larger curves, it worries me that some of the best minds of a generation in the tech 

world are focused on how to get you to click on more ads rather 

than technology that can be helping our Armed Forces. And I think 

one of the big reasons for that, as I mentioned in my opening statement, is it is just too hard. Companies don’t know the terminology 

that is being used in this room. They don’t know how to engage in 

government processes or DOD processes. They look at what it 
23 

would take to learn, and unless they are making a technology that 

is specifically suited for that area, they are just not going to do it. 

Mr. MOULTON. So what can we do to try to fix that? I visited a 

company in my district that is developing an iPhone-based application or mobile-phone based application. And just out of curiosity I 

asked them why they had switched from the iPhone to the Android 

phone. And they said, well, the problem is it is harder to access the 

software on an iPhone. And I said ironically that sounds like a 

really good thing if you are in the Department of Defense, but obviously DOD does not have a good relationship with Apple; so in this 

case it might be harder to hack into an iPhone, but we are going 

with Android, and it is nothing against Android, but if that is true 

based on what they implied, it seems like a better partnership with 

Silicon Valley would help. What can we do to facilitate that? 

Mr. PASQUA. I think there is a couple of things. I think one of 

the things that would be really helpful, and it has been happening. 

We are getting many more visits from different governmental organizations to the Valley to make companies more aware of what the 

opportunities are and how they might get more involved. But there 

needs to be, you know, short of changing all the acquisition processes, there needs to be some methodology, some help for these organizations to be able to sell into the Department without having 

to learn all of the processes that are involved because they are just 

not going to do it. 

So whether it is working with larger integrators who already 

know the ropes so to speak, or creating conduits by which some of 

these technologies can get embedded into other modular platforms, 

as we have been discussing, more easily, I think either of those approaches would do it. 

Mr. MOULTON. I just have 30 seconds. Dr. Chu, did you have a 

comment? 

Dr. CHU. I think in terms of getting other firms to be willing to 

offer to the Department, what does need to be thought about is do 

we need to burden the contractors with as many special provisions, 

largely social goals, as current acquisition statutes require? It 

makes it very difficult for the commercial firm to want to offer to 

DOD. This is a high wall of expertise and requirements we are 

going to have to meet. 

Mr. MOULTON. Thank you. 

Mr. HUNTER. I just had one thought there. Other transaction authority, something that the pending NDAA would make permanent, 

is a way to do this to create a special, much stripped-down agreement with commercial companies. It is definitely a great tool, and 

it is something the Department needs to use more. 

Mr. MOULTON. Thank you. Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you. Mr. Scott. 

Mr. SCOTT. Thank you, Mr. Chairman. And I think the question 

of is perfection the enemy, is good enough to get the job done, is 

something that we all wrestle with. And I also wrestle with, for example, cancelling the F–22 line before another plane is ready to go. 

I don’t think that General Electric or any manufacturer in the 

world would stop one line of refrigerators before they had another 

line that had proven that it was capable of doing so. 
24 

I want to talk with you a little bit about the rapid acquisition 

process and the JSTARS [Joint Surveillance Target Attack Radar 

System], that E–8 platform flies out of Robbins Air Force Base. We 

have discussed for a long time the rapid acquisition process. And 

this is effectively a platform where the technology is ready to go. 

It is just a matter of getting the go-ahead if you will and the decision from the Department of Defense with regard to which platform 

they want to go with, and we are going to end up with an operational capability gap because of the depot maintenance that is 

going to be required on that platform, and there is not a battle 

management platform that can take its place going forward. 

So, just if you could speak to why is there the delay when the 

Air Force knows what it wants, when they know the rapid acquisition process would save money, they know they have to field a new 

fleet, and the delay is actually going to result in an operational capability gap of a couple of years before full operational capability 

comes back, what factors contribute to programs being lengthened, 

even when they have those high levels of technological readiness 

for the major systems and subsystems? 

Mr. HUNTER. My perspective on the JSTAR’s recap program is, 

it gets back to this question of vision. I think the Air Force’s vision 

for that program as a battle management control asset is something that the broader Department is still waiting to embrace, 

maybe would be the way to put it. Other services have thought traditionally—I think the Army has thought traditionally—of JSTARs 

as more of an ISR-type [intelligence, surveillance and reconnaissance] asset, so these are slightly different missions that the services see coming from this platform. 

And if you think of it as an ISR asset, you say, well, we have 

got lots of ISR assets, and we have got unmanned ISR assets, and 

so why is a manned platform the right way to go? The Air Force 

sees JSTARs fundamentally as something bigger than or more than 

an ISR asset. And I think that is kind of the dialogue that has 

been going on. And they are making kind of that first step, and I 

mentioned in my testimony that Paul mentioned about the milestone B decision, which is a threshold decision of do we want to invest in this or not? 

And you want to be cautious making that decision, but once you 

have made it, and you have made a good decision hopefully, then 

I think the priority is to proceed with all speed into program execution. And that is where I think JSTAR’s recap would be a good example of something that ought to be one of these adaptable programs that I mentioned, particularly given the pace of evolution of 

electronics technology, that you want to have a design for that system that you can upgrade continuously throughout its life cycle because you know the technology is going to be light years away in 

30 years in ways that we could never imagine today. 

Mr. SCOTT. Well, we already have some of that. We have the 

ability to plug and play, if you will, with certain camera systems 

and other things, and with respect as far as the Army, you said 

waiting to embrace, that is not my understanding from the Army. 

That platform flies continuously and has for approximately 20 

years. We have got a problem with corrosion now. I mean, these 

planes are old. These are 707s, I think, from the 1970s that we 
25 

have updated and updated and updated; and to send these units 

through another major round of depot maintenance, it would make 

much more sense to spend the money on totally new systems. 

Mr. HUNTER. And I agree with that, sir. I am not in any way 

suggesting we shouldn’t move forward on the program. I think this 

dialogue that has been going on as they have gone to this investment decision has been more about the vision than it has been 

about the specifics of the program. 

Mr. SCOTT. What about just the example of shutting down, for 

example, the C–17 line without another lift capability ready to go? 

I am out of time. I apologize. I yield. 

The CHAIRMAN. Interesting questions. Mr. Castro. 

Mr. CASTRO. Thanks, Chairman. I know that we talked about the 

competitiveness of the process in contracting and how it has become dominated over the years by a smaller group of companies. 

Some of that is due to consolidation. We also talked about how 

hard it is for commercial enterprises to break into defense work. 

So I guess let me ask you, we also have in front of us information 

on the cost overruns and breaches for each of the divisions. Is there 

any penalty for a contractor who experiences a cost overrun on a 

contract? Or I should ask what is the penalty? 

Dr. CHU. Depends on the contract. If you have a cost-showing 

provision or if it is a fixed-price situation of some kind, the contractor will obviously earn a lower rate of return. I think the ultimate penalty for the contractor is something Mr. Francis touched 

on, which is, if the system proves more expensive, the Department 

may decide to buy fewer of those systems. And so the length of the 

production run or the volume of business the contractor enjoys is 

thereby diminished. 

In the worst case, the Department will decide, has occasionally 

done so, this is too much. We are going to stop and thereby lose 

the opportunity to further production. So any contractors have an 

incentive to try to keep, not necessarily to meet the guidelines that 

were pledged in the acquisition process—that is a whole different 

issue—but to keep the production price of the article still competitive with the mission need. 

The real issue in all these cases is, is this worth investing in to 

perform the mission we have in mind, or has it become too expensive relative to the return that it will yield? 

Mr. CASTRO. And is it fair to say that over the years particular 

contractors have again and again gone over on cost? 

Dr. CHU. Since we now have a small number, I don’t think any 

of them has been exempt from that problem. I think it is important 

to keep the cost overrun issue in perspective. The large cost overruns are largely percentagewise on development contracts, not production contracts. Once we get to production beyond the first few 

lots, we generally have a fairly good idea what it is going to cost, 

and people stay within those parameters. 

The typical program doesn’t actually overrun. That is not always 

true. That is the legend out there that they all overrun. That is not 

fair—— 

Mr. CASTRO. Let me ask you this. We have been speaking about 

each contract individually. Is a contractor who consistently overruns penalized when they bid for a new contract? In other words, 
26 

with consumers, for example, many of us are subject to credit 

scores; right? So if we demonstrate bad credit over a period of time, 

there is a penalty when you try to get credit next time. Does the 

same principle apply with contracting here? 

Mr. HUNTER. Well, I would say it does to an extent. There is two 

ways in which it can apply. One is past performance. Rarely are 

major contractors ruled out because of past performance, so there 

I would say no. On the other hand—— 

Mr. CASTRO. Are they not ruled out because there are simply not 

enough options that we have? In other words, is there such a limited number of these contractors that you just can’t go anywhere 

else? 

Mr. HUNTER. It could preclude competition if we ruled out a 

major competitor, but what they do often in the evaluation process 

is they will evaluate the contractor’s price, not necessarily exactly 

at what they bid it, but at what the estimators inside the government think that that would really translate to. In other words, for 

example, with the tanker contract, the last version of that was 

fixed price, so it was evaluated at what was bid. 

But a previous version, they evaluated the price of the bidders 

higher because they thought, we don’t really believe the costs that 

you are putting forward. And so depending again on the nature of 

the contract, they can evaluate a contractor at a higher price if 

there is a history that they have delivered at a higher price. 

Mr. FRANCIS. If I may, it can get pretty complicated, so an overrun, you get into a debate as to whose fault it is. Did the contractor 

deliberately underbid and then overrun, or did the government underestimate and—— 

Mr. CASTRO. Well, but is it safe to say, that the Department of 

Defense has the most overruns, and the cost is the highest of any 

of the agencies of the Federal Government? You are part of the 

GAO, so I assume—— 

Mr. FRANCIS. Right. Actually as much as we talk about the Department of Defense, they are probably the best in acquisition. If 

you go to the civilian agencies, they are much worse generally. 

Mr. CASTRO. So there are more overruns and more breaches? 

Mr. FRANCIS. A much higher percent, yes. This is probably the 

subject of another hearing, but the government and the contractors 

don’t share the same interests. I mean, they are working together 

on a program, but where the government may be thinking it has 

got a contract to get a product for a certain price, where the contractor maximizes its profit. The contractor is also interested in a 

longer business line, keeping its facilities amortized and so forth, 

so they may sacrifice profit to get a larger volume of business, so 

two different incentives here. 

Mr. CASTRO. Thanks. My time is up. I yield back, Mr. Chairman. 

The CHAIRMAN. Thank you. Ms. Stefanik. 

Ms. STEFANIK. Thank you, Mr. Chairman. Over the course of the 

war in Afghanistan, we saw ground combat vehicles undergo a 

number of upgrades and additions because of new and increasing 

threats. But specifically in the Army, protecting the safety of our 

soldiers also added additional weight of combat vehicles, and, 

therefore, we had subsequent challenges to maneuverability and 

rapid deployability. 
27 

I represent the Army’s 10th Mountain Division, and lightweight 

weapons systems, body armor, and operational mobility are essential capabilities for the 10th Mountain. So the struggle as I see it 

is how do you balance the weight against the protection, against 

the budget? So for example, obviously a vehicle built out of titanium would address the weight challenges, but the cost would be 

much greater. 

So how can we as Congress help the DOD make those needed upgrades or obtain new and affordable materials which are able to 

stop emerging threats? 

Dr. CHU. I think your question goes exactly to the thought I offered, that a more physics-based approach at the early stage of the 

program, looking at these tradeoffs explicitly, would be very helpful. And if Congress were to ask for what the parameter space 

looks like, which it doesn’t tend to do, in other words if we want 

more protection, what are we going to sacrifice either in carrying 

capacity of the vehicle, or cost in order to use a more advanced 

technology for protection, that would lead to a more informed debate about why did the Department pick the particular combination of ingredients it is recommending in the program that is going 

forward? That conversation at the legislative level typically does 

not happen now. 

Mr. HUNTER. I would say, you bring up a point that I think 

starts to highlight some of the challenges that the Army has in 

moving forward with its acquisition programs and its vision. Because I know that the Army has looked at what can we do with 

combat vehicles. 

And one of the reasons why I would suggest and that I have 

heard from some in the Army acquisitions system is that they 

aren’t moving forward on a new ground combat vehicle is because 

they don’t think they can get one that is significantly lighter than 

the systems they have today. And there is some logic or some mode 

of thought that says why would I invest billions of dollars in a system that ultimately isn’t going to meet the objective I want, which 

is a lighter, more maneuverable vehicle? 

This also relates to the point Dr. Chu made about the MRAPs 

and why the government didn’t retain most of those. We did retain 

some, and actually many of the ones that were retained are the M– 

ATVs [MRAP All-Terrain Vehicles] that were maintained in Afghanistan which were more mobile and able to move around in 

more challenging terrain. But the heavier versions that we used in 

Iraq have largely been let go because they don’t meet that priority. 

Mr. PASQUA. Just a quick comment. I agree with Dr. Chu’s comment about understanding and explicitly choosing the point in the 

trade space early on in the process and understanding what the entire space looks like. I would just add that it is important also to 

get a feel for what it will take to make a move in that space. So 

we can understand where we can be at a given point in time, the 

tradeoffs that we are making to choose that point, and understand 

what it will take if we want to move in other directions, or at least 

have a feel of the scope of it. 

So that is to say that, you know, we talked about modular and 

adaptable systems, but they are not free. They are actually hard. 

It is hard to design a system that is adaptable in every conceivable 
28 

way; and, in fact, you typically don’t want to do that because it will 

introduce new limitations or costs. But it is important to understand, even when making the initial choice, what the costs will be 

to make moves to different areas in the trade space like lighter 

weight, what the costs would be associated with that, and in the 

upfront design decide whether it is appropriate to enable those 

moves in the trade space later. Because as I say, it will take costs 

to enable that modularity or flexibility. 

Dr. CHU. If I may add one thought, as one looks at the technical 

trades, I think it is always important to keep in mind what mission 

need are you trying to fulfill? And that may lead to you conclude 

that you don’t need quite as technologically ambitious an article as 

you thought you did. 

An example comes to mind on position navigation precision, one 

of the technical programs I have had a chance to look at. When we 

were aiming at a very high degree of precision, when we showed 

operators, back a bit to what Mr. Hunter was emphasizing, what 

we could achieve, which was far south of that objective, they said, 

no, no, that is good enough. Don’t keep going. We will take what 

you have already been able to achieve. 

Ms. STEFANIK. Thank you. Mr. Francis, do you have anything to 

add? 

Mr. FRANCIS. Yes. I think a good example of what you are describing is what Secretary Gates brought up, so when the Army 

was really putting all of its emphasis on the Future Combat Systems for the next war, Secretary Gates made the point that we are 

not really focusing on the war that we are engaged right now. 

And I think the issue becomes in some cases we are not anticipating well. So the science and technology community was not necessarily working on those up-armoring solutions. So, when the need 

arises, we have to react, and we have to react maybe suboptimally, 

so anticipation is important. 

Ms. STEFANIK. Thank you, my time is expired. I yield back. 

The CHAIRMAN. Ms. Speier. 

Ms. SPEIER. Thank you, Mr. Chairman. Thank you to our experts 

who are here today. You know it has been said that we have the 

best weapons in the world, but our acquisition pipeline often gets 

us those weapons late and over budget. 

Mr. Francis, you have said that to describe our acquisition process as broken is an oversimplification because it implies that it can 

merely be fixed. Time and time again we have tried to overhaul 

this process. We come up with the same challenges, an ingrained 

culture, an inadequately trained workforce, an inexperienced set of 

program managers, and a dangerous revolving door to industry. 

In March of 2015, the GAO issued a report that 19 of the 38 assessed programs reported they planned to begin production prior to 

completing software development needed for baseline capabilities. 

A perfect example is the F–35, where software for even basic capabilities necessary for testing and evaluation are running months 

behind. As weapons systems grow in complexity, this is a problem 

that will come up more often than before. 

How can we adjust our acquisitions process to better develop and 

test the software components of the hardware? And that question 

is open to any of you. 
29 

Mr. FRANCIS. So, Ms. Speier, I think one of the issues there is 

not fully understanding what the requirements require from the 

design. And that is something we have had conversations with the 

chiefs about. They think they understand the general requirements, but they don’t understand the thousands of specifications 

that are necessary to meet those requirements. And a lot of that 

translates into software code. 

And I am trying to remember on the JSF [Joint Strike Fighter], 

and maybe one of of my colleagues here can help me, but I think 

it is like 80 percent of JSF’s functionality comes from software. I 

don’t know that that is known in the beginning. And that is what, 

when I talked earlier about we need to know what the design requires and what risks we are taking upfront and we can make decisions on that. 

Rather what tends to happen is we don’t know enough when we 

start. These risks get played out later on, and we end up with what 

I call latent concurrencies, doing things at the same time that we 

didn’t plan on doing at the same time. So if we are going to be concurrent, let’s agree to it upfront and say we are taking that risk. 

If we don’t want to be concurrent, then we have to understand the 

design better sooner. 

Ms. SPEIER. Mr. Francis, you were here almost exactly 2 years 

ago on October 29, and I am sure you feel like a broken record, but 

on the theme of repeating yourself today, you mentioned the Fordclass aircraft carrier in your testimony. Saying that the GAO identified this program as lacking a good business case back in 2007. 

That makes the program’s current struggles unfortunate but not at 

all unsurprising. 

What programs are currently in the pipeline that we should be 

looking at with greater scrutiny? What aren’t we looking at today 

that you will be talking about in 2 years? 

Mr. FRANCIS. So I will come back for the record with a list, but 

I think the Joint Light Tactical Vehicle, the Army program, is 

something that needs to be looked at. Long Range Strike, when 

that program comes up, that needs to be looked at. Ohio-class replacement is another big one coming. DDG–51 Flight III right off 

the top of my head are big ones that I would think about. 

And I think for Congress, where you really have to weigh in is, 

when money is being requested for these, so their milestone B decisions might be 2017 or so, but you have to ask those hard questions now when you are putting money on the table. So I will come 

back with another list, but perhaps some of my panel members 

here know about other new programs coming, or maybe not. 

[The information referred to can be found in the Appendix on 

page 117.] 

Mr. HUNTER. There is a few others. We mentioned JSTAR’s capitalization program which is right on the cusp of entering the process, and another one that has been a big focus has been U-class 

program. 

And I assume when Paul says take a look at them, that doesn’t 

mean cancel all those programs. I am not, certainly, going to put 

myself in that position. But I do think the role of the Congress in 

examining that investment decision that the Department has 
30 

made, to say ‘‘Why is the cost of this worth it from a warfighting 

perspective?’’ is absolutely the right question to ask. 

And asking it right around the time of milestone B, I would say 

ask it around the time of milestone B. Paul is saying ask it a little 

earlier than that even. You want to be on the front end. Once you 

get deep into the program, there are constituencies associated with 

it, and frankly, you are committed in a way that is just hard to get 

out of. And that is why those early milestones are so critical. 

Ms. SPEIER. Thank you. I yield back. 

The CHAIRMAN. Ranking member. 

Mr. SMITH. Just following up on that, you talked about all those 

programs that have been to be, quote, ‘‘looked at.’’ Obviously, they 

have to be looked at. They are going to cost us billions of dollars. 

You are planning on building them. Looked at, A, from the standpoint of do we even need it? Is that is what you are saying? I mean, 

if you could be specific because, I mean, you rattled off basically 

all of the major programs that we are planning on building over 

the course of the next decade or so. 

And you know, Ohio class, Long Range Strike, JLTV [Joint Light 

Tactical Vehicle], are there any of those that you would say from 

a warfighting standpoint, why are we building this? We don’t really 

need it. That is one. And then two, are we making some of the 

same mistakes with those programs that we made with the F–35, 

basically constructing the plane as it is working its way down the 

runway? And those are my two questions. 

Mr. FRANCIS. So, what I was suggesting was more on, are these 

programs executable? Whether they are needed, and what are the 

right solutions? You know, I have to think the Department really 

does consider that pretty heavily. You do have to ask those questions, and I would ask, I think it is hard to say these programs 

aren’t needed. 

The real hard question is, do we need this program at the expense of this other one? What tradeoff are we making? Those are 

fair questions to ask. I don’t have evidence to say these programs 

aren’t needed. But I do think where you can really weigh in is, we 

have talked about things like technology maturity. Is the design 

understood? Do the requirements reflect reality, or are they too 

lost. 

Mr. SMITH. And as you look at where we are at on those programs, can you point to a specific red flag? Because, I sort of get 

all that. That basically, you know, on these big-ticket programs 

now, you know, concurrency is—well, I can’t say that word in a 

public hearing—but not a good idea. 

Basically figure it out, then build it. Not at the same time. Do 

you see us making that same—are we counting on that level of, 

okay, we will build it and then we will figure it out as we go? The 

Ohio-class is an enormously expensive program. I think it is probably the most expensive one of the bunch. Are we making that mistake in these early stages in your view? 

Mr. FRANCIS. So we haven’t yet looked at Ohio class, or JLTV, 

or Long Range Strike. We are looking at Long Range Strike, but 

that is classified so we can maybe give you some information on 

that. So I don’t have anything specific to offer there. On DDG–51 
31 

Flight III that is moving very fast. That is really rapid acquisition. 

We do have—— 

Mr. SMITH. Is that a good thing? 

Mr. FRANCIS. Pardon me? 

Mr. SMITH. Is that a good thing? 

Mr. FRANCIS. I think in this case it is going a little faster than 

it should. It has been bundled into the multiyear for the DDG–51 

Flight IIA. 

Mr. SMITH. But isn’t the real issue here just the rapid pace of 

technology? You know, I mean, we can all just sort of logically say, 

as I facetiously said, don’t build the airplane as it is working its 

way down the runway. You know, figure out what you are going 

to do, and then do it. 

But the problem is, while you are building these things, technology is just boom, boom, boom, boom, boom, moving. I mean, it 

is Moore’s law. You know, how do you get around the problem that 

if you take the opposite approach and you say, look, we are going 

understand it, and then we are going to build it. And we are not 

going to change it. 

Because really what drives a lot of these costs, well, on the Ford, 

is change orders; is as we start building it we go, you know what, 

now we could do this. Let’s do that. Let’s add that to it. I mean, 

Huntington Ingalls will tell you that if they were building the same 

aircraft carrier that they were told to build when the contract was 

given to them, it would be on budget. But there has been so many 

changes. 

But I guess what I am asking is, part of those changes are driven 

by just the way the world works these days. Technology is updated. 

You can build a better thing. Would you say that we are better off 

to say, look, we know the technology is improved, but we are better 

off building good enough, than trying to adjust to that technological 

improvement that could make it better? Because isn’t that what 

really traps us on these things, is the technology, you know, leaps 

ahead while we are in the process of building it? 

Mr. FRANCIS. Well, two things, Mr. Smith. I think when you talk 

about enabling technologies, technologies that make that platform 

possible, so on the carriers it is the Electromagnetic Launch System; it is the Dual Band Radar, and it is the Advanced Arresting 

Gear. 

If these are enabling technologies, you have to have them matured before you go forward with the concept because they make 

the concept possible. Going forward from that, you want to have 

open systems architecture so you can then bring in modular improvements of that baseline. 

Mr. SMITH. Upgrade. 

Mr. FRANCIS. That is right. So what is going on with the Ford 

class is not so much technology refresh as we go, it is technology 

discovery as we go. 

Mr. SMITH. Right. 

Mr. FRANCIS. So you have to have a two-pronged approach, I believe. 

Mr. SMITH. Yeah. I mean, to a certain extent aren’t we—I’m 

sorry, go ahead, Mr. Hunter. 
32 

Mr. HUNTER. Well, I was going to add to that, we have been having a discussion about adaptable systems. And I think to your 

point, an example that I used in my testimony is the Predator system, you know, which has really evolved. It is almost unrecognizable now as a system from where it was when it started. And in 

incremental changes along the way, it has adapted to warfighter 

needs. 

And I think it is a classic example of how that can be done. You 

start with a relatively simple thing. It is an air truck. It happens 

to be an unmanned air truck, but other than that, it is basically 

an air truck. But it is a flexible enough design that as new sensors 

have come along, new weapons have come along, many, many 

changes, I probably shouldn’t get into all of them that have been 

made—— 

Mr. SMITH. Right. In that case we were able to add it to the existing Predator. We weren’t required to scrap the ones we had and 

build a whole bunch of new ones, is that correct? And I am sure, 

but—— 

Mr. HUNTER. Well, it is true in part, and untrue in part. 

Mr. SMITH. Right. 

Mr. HUNTER. So the design that we have today is significantly 

bigger than the original assets that were done. But it looks roughly 

the same. So the general design concept has been fairly constant, 

but it is a bigger airplane today than it was before. 

Mr. SMITH. Yeah, but like on the Ohio class, I suspect that as 

we build that thing, there is going to be technological improvements that we are going to want to add to it. And I actually would 

suggest that we are better off not. 

We are better off saying, look, we cannot afford to drive these 

costs through the ceiling, and yes, maybe it won’t be absolutely perfect or as good as it could be, but particularly from a competitive 

standpoint. I think the Ohio class would be able to serve its function without adding all the new stuff that is going to be discovered 

in the next decade. 

And I think that is a choice we need to make because it seems 

to me, we always make the other choice, which is, you know, this 

is my Austin Powers joke: All I want is sharks with frickin’ laser 

beams attached to them. I use that joke frequently in acquisition, 

because, you know, it’s like, we can do this. Let’s try it. And we 

could, but the costs are prohibitive compared to the gain. 

And I think we need to start accepting good enough instead of, 

we could put the laser beams on the sharks, so let’s go ahead and 

give it a shot. But, you know, those are individual decisions that 

have to be made program by program by the program managers 

and by the Pentagon. I just hope they will start making the more 

cautious decision to save us some money. 

Mr. HUNTER. Ohio class is an interesting example, because actually, you probably need less than the existing system we have 

today. I am not suggesting we scrap them, but—— 

Mr. SMITH. I am sorry, which system? 

Mr. HUNTER. To the existing system we have today—— 

Mr. SMITH. Right. 

Mr. HUNTER [continuing]. In the sense that we are going to fire 

the same missile—— 
33 

Mr. SMITH. Right. 

Mr. HUNTER [continuing]. And we don’t necessarily need as many 

tubes as we have today. Our requirement is not as robust as it was 

when the Ohio class was designed. So, of course, we are 30, 40 

years on, and so there is going to be new technology. There has to 

be new technology in the system because you can’t go backwards—— 

Mr. SMITH. Right. 

Mr. HUNTER [continuing]. On many of these things. The one last 

thing I would say in terms of submarines, is the Navy really pioneered this adaptable systems approach with the combat system on 

attack submarines, their Acoustic-Rapid COTS [commercial-off-theshelf] Insertion Program. And I think that is exactly what you are 

describing, is, you know, go into production with a design that you 

know works, and then have a system that allows you to update and 

upgrade that combat system as technology proves out. 

Mr. SMITH. Okay, thank you very much. Thank you, Mr. Chair. 

The CHAIRMAN. Thank you. Ms. McSally. 

Ms. MCSALLY. Thank you, Mr. Chairman. And thank the gentlemen. I spent 26 years in the Air Force, and I was lucky that I 

didn’t get any assignments to the Pentagon. So my perspective 

comes from the warfighter end of that perspective. 

We had a hearing earlier this year and my first question is about 

development of aircraft, not Joint Strike Fighter-type aircraft, but 

say, follow-on to the EC130, or follow-on to the A–10 for a lightattack aircraft. 

In a hearing earlier this year, I asked the Pentagon official if we 

decided today that we wanted to develop a light-attack aircraft— 

again, this is not complicated technology. It is just all of the things 

that we have learned about what does permissive CAS [close air 

support] and does it well to follow on to the A–10, and we decided, 

today if we wanted to do it, how long would it take? And he said 

about 15 years, I think was his answer. 

I look at the EC130. We know the guts of the EC130 is working. 

It has got a great mission set. We know it needs a new platform, 

but, you know, we struggle to take forever in order to figure out 

how to adapt what we have and put it in a new platform. 

You know, what is it we can do specifically in like these types 

of things? We are not developing new stealth technology, fifth-generation fighter, but we are just learning from everything we have 

had, and we have just got to refresh and put it into maybe a different package. Like, why can’t we do this faster? And what can 

we do to help especially in those two examples, you know, to be 

adaptive, to put these smart brains together, and develop something in 3 to 5 years that could be follow-ons to these type of platforms. Anybody want to jump in? 

Mr. HUNTER. Well, I can’t resist, having spent time doing rapid 

acquisition. We do do it faster. We have done it faster. This is 

something that I guess amazes me after my time in the Department that, you know, go to Iraq, go to Afghanistan—— 

Ms. MCSALLY. For an aircraft. Specifically for an aircraft. 

Mr. HUNTER. Yeah. There are systems that are flying. Hosts that 

just simply didn’t exist even 3 years ago. 
34 

Ms. MCSALLY. So why do they still say 15 years then? What are 

we missing? 

Mr. HUNTER. So what that is an answer to is a fleet of aircraft 

that we are going to sustain for 50 years. It takes 15 years, essentially to—if you are lucky, to have a program that is going to be 

a 50-year, large aircraft fleet type of a system. 

And there may be opportunities to accelerate that, but on the 

other hand if you think you are going to sustain something for 50 

years, it probably makes sense to take a little extra time to get it 

exactly right. But we don’t need to do that in all cases, and I think 

that is kind of the key. 

Ms. MCSALLY. Yeah. 

Dr. CHU. I am not sure I want to defend the 15-year estimate 

as being meritorious. 

Ms. MCSALLY. Yeah. 

Dr. CHU. Certainly, if you insist on starting every element of the 

new design over, you are going to add to the time scale. I think 

part of the genius, and it is hinted in the way you phrased the 

question, is can we take some existing designs—which might be 

foreign, by the way, not necessarily in the United States—and 

adapt those to whatever purpose we have mind. And I think a 

more—the approach that builds more on what we already know 

would allow you to field capabilities faster. 

Mr. FRANCIS. So a couple thoughts. I have been around long 

enough to remember when the A–10 was being developed and the 

Air Force wasn’t particularly in love with it either. 

Ms. MCSALLY. Still isn’t. 

Mr. FRANCIS. So you have to want to do it. I think what Mr. 

Smith was saying is important. The 80 percent solution has to be 

okay. 

Ms. MCSALLY. Right. 

Mr. FRANCIS. And that is hard to sell because you have to show 

you can crush all the alternatives. So you need a 200 percent solution. Eighty percent has to be okay. The other thing we haven’t 

talked about is there are cases where you want to put a time constraint on the development. So if you put time in there as a constraining factor and say, I want to get through the development 

phase in 4 years, what can I do then? That has a way of affecting 

the requirements of the design. 

Ms. MCSALLY. Yeah. Great. Thanks. You know, my other experience with this is, I have spent a lot of time in air operation centers, 

and joint operation centers, and spiral development is something 

that we worked on in JEFX [Joint Expeditionary Force Experiment] programs and time-sensitive targeting. 

And, boy, that seemed to work great, but as was mentioned earlier, that is not the norm. That is kind of a one-off where you have 

got the warfighter and the people who are developing the technology for command and control. Which is basically about collaboration, real-time decision quality information. This is not rocket 

science. I mean, this is just allowing the information to be collaborated for the exact type of mission that you are looking for and 

adapted, and that worked really well. But that is really not the 

norm. 
35 

You know, just basic geospatial information we were trying to develop in the Joint Operations Center at AFRICOM [U.S. Africa 

Command] and had that vision, but it just seemed like we were 

dealing at the speed of bureaucracy instead of broadband. And 

when it comes to some of these other issues with command and 

control, collaboration, information sharing, there is some great 

stuff that is, obviously, way out in front of us in the civilian world, 

in the private sector. 

What do we need to do in order to very quickly bring that in to 

make sure that, you know, we are allowing our command and control system to not be bogged down? Because it was a quite painful 

experience that I went through in both the Air Operations Center, 

and the Joint Operations Center, just not being able to adapt 

quickly enough. And anybody want to jump in? 

Mr. HUNTER. Well, I would say one thing is that there are real 

impediments in the system that make it very hard to do that. And 

we have talked a bit here about the agile approach to acquisition. 

And there is a real challenge to utilizing that approach, and I mentioned, I have talked about it as adaptable systems, which is the 

system is designed to say, give me a clear baseline, everything you 

are going to do, and then I will grade you as to whether you have 

met that baseline or not, or whether you have gone over. And if you 

have gone over, I am calling you for cost growth or schedule 

growth. 

And there is, now, and I have said a lot of things that I like that 

are in the pending NDAA [National Defense Authorization Act]. 

There is one that I don’t like, which is the provision that says, we 

are going to penalize the services year after year after year, if they 

experience any growth above baseline. Well, if you have got a fragile system, or adaptable system, of course, you are going to grow 

the baseline. That is the whole idea. That is the point. 

But effectively, you know, this provision is going to make it so 

that the services, in order to do that, it is going to be like going 

over the salary cap for an NFL [National Football League] team or 

an NBA [National Basketball Association] team. They are going to 

have to pay a penalty every year because they are trying to do 

something to make the system better. And I think that there are 

many other barriers because it becomes very hard to baseline these 

programs where you know you are going to evolve them, but you 

don’t know exactly how yet. So that is a real issue that we need 

to work through, and I talk in my testimony about we need to come 

up with a new paradigm, not for everything, but for some of these 

systems that we think we need to be highly adaptable. 

Ms. MCSALLY. Yeah. 

Mr. PASQUA. There is an approach in industry called MVP, for 

minimum viable product, and the whole idea there is, don’t build 

the be-all, end-all. Don’t boil the ocean. Build what is actually 

needed to accomplish whatever it is you are trying to accomplish. 

And build the minimum thing that is needed. Because, in fact, you 

are not going to know all the details of how it is going to grow and 

how you are going to want to adapt to use it. 

So instead of trying to build the be-all, end-all, the goal is much 

more to build the smallest thing that meets the requirements with 
36 

the adaptability to go in different directions that you don’t necessarily know today. And that has two sort of beneficial outcomes. 

One is, it happens fast. It is small. It tends to focus you on what 

is really important rather than on contingencies that may be important some day. And it gets you to focus on the adaptability of 

the architecture that you are building, so that as you actually use 

it and find what is important, or your needs change, it is easier to 

actually take the system in the direction you want to go in a much 

more cost-effective way. 

Ms. MCSALLY. Great. Thank you. Thank you, Mr. Chairman, I 

yield back. 

The CHAIRMAN. Thank you. Mr. Langevin. 

Mr. LANGEVIN. Thank you, Mr. Chairman. I want to thank our 

witnesses for your testimony and appearance here today. It has 

been a very interesting discussion, obviously. 

So I serve as the ranking member on the Subcommittee on 

Emerging Threats and we oversee all of our R&D efforts, DARPA 

[Defense Advanced Research Projects Agency], and ONR [Office of 

Naval Research], and others. And just in S&T directly, you know, 

the basic nature of S&T development means that several failures 

often proceed as successful technology. DOD culture, and acquisition processes, and congressional oversight are often risk-averse at 

best, and punish failures at worst. How can this culture be changed 

or mitigated, or should it? 

Mr. FRANCIS. Well, Mr. Langevin, I would say definitely making 

the investments in the science and technology community, and giving them the budgets to take things further, so I think you have 

to have a wide funnel in the front. I think you want to have a lot 

of failures early, and then as you are paying for more mature technologies and higher levels of demonstration, obviously, you have to 

be more discriminating there. 

But the S&T community, I think, should have the organization 

and the resources to take those technologies further up and be 

okay with having those failures early. Right now, I think it is not 

so much that we are afraid of failures, but we put things that 

haven’t reached the point of failure yet, and we put them in an acquisition program, and then we discover what the failures are. 

So I don’t have really a problem. We were talking earlier about 

the carrier. I don’t have a problem with what those key technologies are going through. The problem I would have is, where 

they are going through them. It is right during construction of the 

ship. So those are the risks that we have to take earlier. 

Dr. CHU. Indeed. I would agree that it is not clear to me it is 

a risk-averse culture. In fact, we take the wrong set of risks, I 

think is what Mr. Francis is arguing. And we underinvest in technology development, without—or let me put it the other way 

around—that too often we see technology development as always 

needing to lead to a new system, and that is not always going to 

be true. 

I think more willingness to sort through the technological choices 

in an organized way and to reward people for giving good advice 

about which are the promising paths versus the ones that should 

be shut off. In the current incentive system, managers talk about 
37 

the value. Everybody thinks he has to get his or her technology 

into production. That is the sign of success. 

Now, I would argue differently. Success is having a broad portfolio of choices to start with and narrowing down to the most promising ones. That does include, as Mr. Francis I think has emphasized to you, much more emphasis on developmental testing than 

has been true in the recent past. 

Mr. HUNTER. One thing I would add in terms of risk is that we 

can do better at managing risk. So I would agree. I don’t know that 

our system is unwilling to take risk, but it does struggle to manage 

risk. And in many cases, you know, you will see these risk charts, 

you know, and there is always one item that is either high yellow 

or red, and everything else is kind of green or in the mid-yellows, 

and they all look roughly the same. Because there, really, again, 

it is in some cases, unfortunately, more about selling the system 

than it is about managing the risk. 

And that requires real discipline, and this is where the quality 

of the workforce comes in. So that the government workforce really 

understands what the risk is, and what is the plan to manage it, 

to burn it down over time. And I think the biggest key there is 

leadership and then the human capital issues that Dr. Chu has referred to. 

Mr. LANGEVIN. A follow-up question. What changes are needed to 

allow for a rapidly changing investment area such as cybersecurity, 

which I spend a lot of time on, where generations of technologies 

can pass within a single budget cycle, and to what extent do current budgeting processes impede the deployment or development of 

technologies? 

Mr. PASQUA. This was a particular frustration area for me. I ran 

the global research organization at Symantec, which is the largest 

cybersecurity firm in the industry. And one of the challenges that 

we had, given the rapid pace of change of the landscape, was that 

we develop new technologies in our research organization and want 

to get those out and into the hands of our government counterparts, but oftentimes the cycle of doing that, just being able to discuss it and go through the process, was so long that the window 

of opportunity for dealing with a threat had passed by the time 

that we were through it. 

And I always wished that there was a way for us to build a relationship that didn’t start and stop; that provided a way for us on 

an opportunistic basis to say, hey, we have got an interesting technology for you that we think is of interest for you to get into service 

today or very soon. How can we make that happen quickly and not 

have to start, you know, a whole cycle of discussions to make that 

process happen that then made the technology irrelevant 9 months 

later. 

Mr. LANGEVIN. I know my time is expired, but that was an interesting question and response. I appreciate your thoughts. I yield 

back, Mr. Chairman. 

The CHAIRMAN. I thank the gentleman. Mr. Cook. 

Mr. COOK. Thank you, Mr. Chairman. I apologize. I had to meet 

some constituents, so I probably missed some of the responses to 

maybe some of the questions that I am going to ask right now. And 

one of the problems I have is just the, and I am speaking as some-
38 

body that has been on the receiving end of some of these systems 

where they don’t work, or they break down, or they just don’t fit 

into the mission that you are supposed to have. 

And I don’t have the complex rocket ships and everything like 

that. I am talking about the M–16 when it first came out in Vietnam where a lot of Marines died because you had a lot of things 

wrong with it. And I actually had an opportunity to change it by 

talking to a guy by the name of Omar Bradley who had to be about 

86 at the time where they dragged certain people from the field. 

That, the Gama Goat, the M–203, which was 5 years that I knew 

it was on deadline, never even saw it fired. I can go on, and on, 

and on. 

And I don’t know if we—and then I was just at a CODEL [congressional delegation] where somebody was asked a question about 

cybersecurity, and they said, we are just starting now. And in 

about 5 years, we are going to show it. We don’t have 5 years. No 

one knows how long we are going to have with what is going on 

in this world right now. 

So I think from somebody that is on the frontline, the troops, 

they want something right away, and something that fits their mission. And you can have a lot of different—but basically, it is to 

close with and destroy the enemy. And I am wondering if we 

launched that philosophy in World War II where we had certain 

systems that came out that didn’t work, where almost within 

weeks, we had changed it. Unbelievable that we could do that. 

And you look at what happens with the Sherman tanks in Normandy, where it was a field expedient by a sergeant that changed 

the whole thing, turned it into a Rhinoceros tank, changed the 

whole battlefield almost overnight. What did it cost, $15? And then 

they did it to all the tanks. 

I can go on and on and on. But I think Congressman Walz had 

a good point. Sometimes I think the individual troops or what have 

you, the customer, the end recipient, the ones who have to live and 

die with this system—Iraq, when we had to upgrade our Humvees 

and the MRAP came down, great success, but in the interim X 

amount of people died or were wounded. 

And I am just saying, to me, I think we have got to expedite 

that, and make it cost efficient and we have to put certain deadlines. And if it doesn’t work, there has to be consequences. That is 

the bottom line. And some of these systems we can do it. 

When we changed from the old bazooka to the 3.5 rocket launcher, sounds simple, but the bazooka was not able to penetrate the 

Russian tanks that were made; the 3.5 was. Now, 3.5 is long gone. 

They replaced it with the LAW [Light Anti-Tank Weapon], which 

was another piece of crap because it didn’t function in humid conditions, so we had all these things come out to the system and what 

happens. All that stuff then went on and on and on. 

So I think we almost need to incorporate that philosophy, what 

has happened in the past. And the best example I can give or hope 

that you would look at are the Israelis. The Israelis don’t have 

time. You look at what they have done with their missile programs. 

You look at what they did in the Yom Kippur War that they almost 

lost and they changed certain things. 
39 

You look at the battleground, 2006 against Hezbollah along the 

Lebanese border, where they changed their MPCs [military personnel carriers] and tanks because the threat was there. And they 

didn’t have 5, 10, 15, 20 years. They had to do it or they were going 

to not exist as a country. 

And if you could comment very briefly, and I yak too much. 

Dr. CHU. You have named some of the notable failures over time. 

I do think part of the—— 

Mr. COOK. I am old, so I named all the old systems. 

Dr. CHU. We did get better, actually, over time, I would argue. 

I think part of the solution is what others have advocated, which 

is often from the field perspective the 80 percent solution is good 

enough. And so one of the reasons for longer times to solve the 

problem than is meritorious is we aim too high. We ought to aim 

at, as I think your comments emphasize, what is most essential for 

accomplishing that mission. What does the troop really need in 

order to do a good job. If we get that done, we could then add to 

that success in a more evolutionary approach. 

Mr. COOK. Thank you. 

I yield back. Thank you. 

The CHAIRMAN. Well, actually, I think that is a good way to end, 

because DOD may be better than government agencies, but we 

have also got more at stake. And so that is part of the reason that 

I very much appreciate you all’s input today. 

I know we will continue to engage with CSIS and IDA and BENS 

and GAO, but I want to encourage you all to continue to offer us 

your input. Don’t wait for us to ask. This, as you know, is a complex subject with a lot riding on it, as we are going to be in an 

iterative process to try to improve it. And we need the assistance 

of people with valuable expertise and insights to help us do that. 

So I appreciate today, and I appreciate your contributions in the 

future. 

With that, the hearing stands adjourned. 

[Whereupon, at 12:03 p.m., the committee was adjourned.] 

A P P E N D I X 

OCTOBER 27, 2015 

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WITNESS RESPONSES TO QUESTIONS ASKED DURING 

THE HEARING 

OCTOBER 27, 2015 

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RESPONSE TO QUESTION SUBMITTED BY MS. SPEIER 

Mr. FRANCIS. The decision to start a new program is the most highly leveraged 

point in the product development process. Establishing a sound business case for individual programs depends on disciplined requirements and funding processes. Key 

enablers of a good business case include: firm, feasible requirements, mature technology, incremental, knowledge-based acquisition Strategy, and realistic cost estimates. 

Every year, there is what one could consider a ‘‘freshman’’ class of new acquisitions. This is where DOD and Congress must focus to ensure that programs embody 

the right principles and practices and make funding decisions accordingly. Congress 

will need to focus on oversight of programs in the President’s Budget projected to 

begin Engineering and Manufacturing Development phase by holding a Milestone 

B decision. What that means, is, for example, for a program with a projected June 

2017 Milestone B, the funding for that program will be in the President’s Budget 

presented in Feb 2016. Congress will need to have started its oversight of this investment before that budget comes in and must conclude before markup. This criterion would provide a list of programs that Congress can most influence. Based on 

that approach, as a starting point, congressional oversight could focus on ensuring 

sound acquisition strategies using knowledge-based acquisition principles are established for the following three programs projecting Milestone B’s in fiscal year 2017: 

(1) Presidential Aircraft Recapitalization; (2) Unmanned Carrier-Launched Airborne 

Surveillance and Strike System; and (3) Joint Surveillance Target Attack Radar 

System Recapitalization. 

In addition, our March 2015 assessed ongoing programs against acquisition best 

practice criteria to identify specific acquisition risks. The risks we reported provide 

an opportunity for targeted congressional oversight of programs already underway. 

We will be publishing our next annual assessment of selected weapons programs 

later this spring which will include updated assessments. [See page 29.] 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING 

OCTOBER 27, 2015 

(121) 

QUESTIONS SUBMITTED BY MR. THORNBERRY 

Mr. THORNBERRY. What can be done to encourage more incremental development 

and deployment of weapon systems? 

Mr. HUNTER. Some of the concepts required for incremental development, such as 

planning and developing ‘‘Blocks’’ of capability that are separately or sequentially 

developed over time and programs to prototype new systems and subsystems, already exist. An example is in the F–35 program, in which the Department has been 

planning and developing Block 4 capabilities for F–35 even as it works to develop 

and deliver Block 2B capabilities that are being used by the United States Marine 

Corps and Block 3F capabilities that are being used by the United States Air Force 

in their initial operation of the F–35. Another example is the separate development 

of mission modules for the Littoral Combat Ship (LCS). However, the approach to 

blocks of capability that prevail in today’s programs remains focused on developing 

and delivering full system sets of capability that are tightly integrated, and that as 

a result, take many years to plan, program and deliver. While this approach is faster and probably cheaper than having entirely separate acquisition programs, it still 

does not match up well with the pace of technology innovation. It is necessary to 

supplement the Block approach by decomposing system level requirements into 

smaller sub-increments or ‘‘packages’’ of capability that correspond to the subsystem 

design level. This would allow the incremental development of these packages of capability that can be designed, prototyped, tested, and relatively rapidly deployed, in 

months rather than years, allowing for the incremental development and deployment of technology at the subsystem level. A potential barrier to this approach is 

in the challenge it presents to ‘‘baselining’’ systems for purposes of budgeting, scheduling, testing, and tracking program execution. Congress should work with the Department to establish a more dynamic approach to baselining acquisition programs 

where incremental development and rapid deployment are identified as priorities. 

Mr. THORNBERRY. What must change in the DOD acquisition process and culture 

to better transition technology from the ‘‘lab’’ to a program of record? 

Mr. HUNTER. The key gap in the current system for transitioning technology from 

the lab to programs of record and fielded system is the fact that while experts within the DOD enterprise have tremendous awareness and knowledge of technology developments (developments in the ‘‘lab’’) across the full spectrum of the in-house and 

industry-led technology sectors, this knowledge is not spread broadly across the enterprise, and in particular, it is frequently not the case that decision makers in the 

requirements and resourcing communities have knowledge of the latest technology 

developments. So there is a gap in turning expert knowledge into enterprise knowledge that can be acted on by DOD leadership. Similarly, the number of opportunities for technology insertion in programs of record and fielded systems are too far 

apart. In the worst case scenario, a program could go from Milestone B all the way 

to full rate production and Full Operational Capability (FOC), usually a period of 

roughly ten years, without significant consideration of technology insertion beyond 

the minimum needed to address issues of obsolescence. Many programs work to create some additional technology insertion points in between these major program 

phases, but they are essentially working against the system in doing so. In contrast, 

the pace of technology change suggests that technology insertion points need to 

occur no less frequently than every six months. The Department traditionally addresses this need to create additional opportunities for technology insertion by creating ‘‘Blocks’’ of capability that deliver incrementally over time. However, in most 

cases these blocks are themselves separated by several years of time. Creating additional opportunities for technology insertion requires allowing the requirements, 

budgeting, and acquisition processes to decompose system-level requirements into 

sub-increments, ‘‘packages,’’ such that these sub-increments could be swapped out 

or updated independently on a timeline of months rather than years. 

Mr. THORNBERRY. What is needed to achieve integration of the requirements and 

acquisition processes in the DOD to facilitate requirements tradeoffs prior to acquisition programs being initiated? 

Mr. HUNTER. The requirements and acquisition communities need to be in continuous dialogue on trade-offs relating to acquisition programs before program initiation and during program execution. While this dialogue exists in many ways today, 

it can be hampered by the fact that both sides are not always speaking the same 

language (in a figurative sense). That is, the requirements community is talking in 
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terms of capability gaps and key performance parameters (KPPs), concepts that are 

fairly absolute and unqualified, while the acquisition community is talking in terms 

of costs, risks, and timelines for development, things that before program initiation 

are estimates that are inherently uncertain and imprecise. For the dialogue to be 

productive, a bridge between these languages is need. In the world of rapid acquisition, this dialogue was bridged by the concreteness of short fielding timelines. Both 

sides could work backwards from an expected fielding date as a basis for understanding how to characterize bottom-line needs, in the case of the warfighter, and 

the art of the possible, in the case of the acquisition community. An interesting example of how this was done on a major defense acquisition program was with the 

Combat Rescue Helicopter program, where Under Secretary of Defense for Acquisition, Technology, and Logistics, Frank Kendall, asked the requirements community 

to put a dollar value on how much more they would be willing to pay to get a capability that met their objective requirement, rather than just the threshold requirement. The acquisition community was surprised that the requirements community 

indicated that they would willing to pay only about 10% more to obtain the increased capability of the objective requirement. When this value criterion was incorporated into the Request for Proposals for the program, it had a decisive effect on 

industry’s evaluation of how to compare cost with capability. In the CRH example, 

the bridge in the conversation came from developing a concrete measure of value 

in the difference between the threshold and objective requirement. 

Mr. THORNBERRY. To what extent is government systems engineering expertise 

available and applied in the requirements-setting process? To what extent should 

it be available and applied? 

Mr. HUNTER. Systems engineering is fundamental to the process of flowing down 

requirements in systems design. In this sense, it informs the ‘‘requirements’’ that 

flow down in the design process from the system level to the subsystem level and 

on down through the design process. However, systems engineering does not play 

a large role in the setting of KPPs in the systems-level requirements process as far 

as I am aware. I can think of one example in my direct experience, on an Army 

truck program, where the maintainability requirements were modified after initial 

review in the Defense Acquisition Board (DAB) when it was brought forward by the 

test and systems engineering communities that the maintainability requirements 

set for the program exceeded any previously demonstrated standard for similar 

Army equipment by an order of magnitude. In this way, the systems engineering 

work that is done in support of the DAB process can, and has on occasion, been used 

as an impetus to revisit the requirement, and in the case of the Army truck program, the Army requirements community revisited that requirement and established KPPs more in line with previous Army experience. If the requirements process is modified as suggested in my answers above to decompose requirements that 

allow for more incremental development at the subsystem level, systems engineering would have to play an increased role in the requirements process to ensure that 

system integrity is not compromised. 

Mr. THORNBERRY. What capabilities or efforts may be needed to streamline the 

DOD’s requirements and acquisition review and approval processes to increase 

‘‘speed to market’’ or getting the right weapon systems from concept to fielding? 

Mr. HUNTER. In addition to turning expert knowledge about technology developments into enterprise knowledge that can drive action, and decomposing systemlevel requirements and adding additional technology insertion points to enable incremental development, review and approval processes should move from processes 

that focus on examining documents in sequential fashion for procedural compliance 

to processes with greater direct interaction and involvement of the various stakeholders focused on developing a common understanding of the strategy being pursued, the risks being taken, the plans for risk mitigation, and the benchmarks of 

success. The goal should be for the acquisition community to leave these sessions 

prepared to support the program manager in pursuing the program, rather than a 

situation where the larger acquisition community observes from the sidelines looking for stumbles. 

Mr. THORNBERRY. Are there lessons learned from the Department’s rapid acquisition programs that can be applied to accelerate other DOD acquisition programs? 

Mr. HUNTER. Absolutely. Chief among these is the need for continuous dialogue 

between the acquisition and requirements communities that updates and informs 

those setting requirements on the likely costs, timelines, and results of development 

efforts and that allows the requirements community to rapidly inform the acquisition community about emerging threats and to refine requirements as additional information about technology developments emerges. This ability for the two sides to 

meet regularly and exchange information regarding urgent operational needs was 

a powerful mechanism for accelerating action and it is applicable in many ways to 
123 

1Patel, Prashant R. and Michael P. Fischerkeller, ‘‘Prepare to Be Wrong: Assessing and Designing for Adaptability, Flexibility, and Responsiveness’’, ISA P–5005, April 2013. 2See Report of the Defense Science Board 2010 Summer Study on Enhancing Adaptability of 

U.S. Military Forces: Part A: Main Report. Washington, DC: Under Secretary of Defense, Acquisition, Technology, and Logistics (USD[AT&L]), January 2011, p. viii–x. 3See William P. Rogerson, ‘‘Profit Regulation of Defense Contractors and Prizes for Innovation’’, Journal of Political Economy, Vol. 97, No. 6, December 1989, pp. 1284–1305. 

other kinds of acquisition programs. Another key for rapid acquisition was the support of senior leadership to overcome obstacles by identifying and transferring funding ahead of the normal funding cycle, approving waivers or taking extraordinary 

action to acquire long-lead items when necessary, and alerting other offices throughout the Department to move rapid acquisition programs to the front of the queue 

whenever approvals were required. Because it is difficult for senior leadership to 

play this sort of role in a large number of cases, it was critical that the rapid acquisition process was associated with a discrete, definable universe of urgent operational needs with a proven and credible requirements approval process. Lastly, the 

availability of flexible funding was essentially to avoiding the long delays associated 

with obtaining funding for new start programs, a process that generally delays even 

the initiation of action on new efforts by at least two years. 

Mr. THORNBERRY. What can be done to encourage more incremental development 

and deployment of weapon systems? 

Dr. CHU. Incremental development and deployment, as the Committee appreciates, is a design and acquisition strategy. The decision to employ it must weigh 

its benefits, and their likely realization, against the costs, and the realism of those 

cost calculations. One benefit may be more rapid fielding, depending on the circumstances involved; another may be the ability to adjust the article’s features in 

response to early field experience or evolving threats; yet another could be capitalizing promptly on research progress. One downside may be the additional complexity (and cost, e.g., for training) that deploying a variety of models could entail. 

Accepting the premise that benefits will at least sometimes outweigh costs (certainly true of several major system upgrades over the last two decades, which constitute one version of incremental development), it may be sufficient to ensure that 

this alternative strategy is one of the options considered by the Analysis of Alternatives that should precede any major investment decision. The evidence on benefits 

and costs should be sufficiently persuasive to make the case for selecting the strategy. 

Acknowledging that systems will change in response to early field experience will 

reinforce that case. Indeed, anticipating the need for changing configurations will 

reinforce the case for an incremental approach. But it does require that the design 

effort facilitate such changes (for example, by providing larger margins for weight 

growth, or space and power for additional features). Two of my colleagues make the 

case for just such an approach in their aptly titled paper, ‘‘Prepare to Be Wrong’’.1

As Patel and Fischerkeller argue, this approach advantages the adaptability of 

equipment as circumstances change. In its 2010 Summer Study, the Defense Science 

Board recommended that we tie program objectives to planned deployment dates, 

to buttress just such adaptability. Doing so also places a premium on constraining 

development objectives, in order to enhance the likelihood that the needed schedule 

will be honored.2

In short, three managerial tools may produce a greater use of incremental development: explicit consideration in AoAs, generous margins for changes, and using deployment dates as a disciplinary instrument. 

Mr. THORNBERRY. What must change in the DOD acquisition process and culture 

to better transition technology from the ‘‘lab’’ to a program of record? 

Dr. CHU. In my judgment, the fundamental problem lies in the current incentives 

facing the potential acquisition partners—government labs, the Military Services, 

the Defense Advanced Research Projects Agency, and private industry. While all 

generalizations are risky, the current incentives for government labs focus their efforts on improving existing equipment, supporting existing Service concepts of operation, not on generating new ideas per se. The Services, which control the ‘‘requirements’’ process, tend to focus on their views of operational needs, sometimes only 

vaguely informed by what might be technologically feasible. To the extent the Services consult the technical community, beyond their immediate staffs and those of 

their OSD overseers, the exchange centers on the dialogue with private industry via 

development contracts. It’s well established that industry sees the development contract as an economic ‘‘prize’’, leading to the source of most profit in the American 

system—the production of finished articles.3 Provided the proposed development 
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4See, for example, Patel, Prashant, et al, ‘‘Defining Acquisition Trade Space Through ‘DERIVE’ ’’, IDA Research Notes, Acquisition, Part 1: Starting Viable Programs, Fall 2013. 5The Army’s critical self-examination of its acquisition system’s performance noted the ‘‘weak’’ 

use of AoAs. See Army Strong: Equipped, Trained and Ready: Final Report of the 2010 Army 

Acquisition Review, January 2011, p. x (sometimes known as the Decker-Wagner study, after 

its two co-chairmen, Gilbert F. Decker and Louis C. Wagner). 

contract responds reasonably to ‘‘requirements’’, there is no particular incentive for 

private industry to work with the labs. 

Accepting these generalizations as broadly applicable, if there is a desire for government labs to play a larger role in the development process, incentives must be 

adjusted. A mechanism to reward the labs for generating successful ideas is required, as a necessary condition. In the private sector for civilian products, that 

mechanism is the return that accrues from intellectual property. A simplistic analogue for the government lab would be some financial return for ‘‘successful’’ ideas. 

But that alone would be insufficient, without a mechanism that encourages a dialogue between the government labs and the Military Services, and among the labs, 

the Military Services, and the producing contractors. Could some early development 

work be awarded the labs, presumably based on the potential excellence of their 

early ideas (which by itself might provide a needed financial incentive)? Would it 

be feasible to create partnerships between government labs and production firms 

that did not generate undesirable conflicts of interest? Might one form of partnership be development of operational prototypes embodying new technological approaches? Could that enhance a culture of experimentation, using experiments with 

prototypes to sharpen the appreciation of both real-world limits and the tradeoffs 

that must be confronted? Would that also help DARPA test its best ideas? 

If successful, such changes in incentives would change the routine behavior of the 

acquisition process participants. But it is also possible to over-ride current routine 

behavior using the Secretary’s (or Congress’) authority, nurturing promising technologies that the labs might develop until they take root. It might be argued that 

is how cruise missile technology became such an important part of the defense portfolio. In the best of all possible worlds such nurturing might bridge the transition 

to a better set of incentives, worked out through trials of the sorts of ideas sketched 

above, both to explore their feasibility and yield insights into the unintended consequences against which the Department must protect itself and the public interest. 

Mr. THORNBERRY. What is needed to achieve integration of the requirements and 

acquisition processes in the DOD to facilitate requirements tradeoffs prior to acquisition programs being initiated? 

Dr. CHU. ‘‘Requirements’’ cannot be separated from the ‘‘physics’’ of the problem— 

that is, the trade space among potential attributes for a system that technology provides. The technology constraint (the ‘‘frontier’’) may not be a bright line, but rather 

more likely a fuzzy zone. As you approach it, and perhaps try to move toward its 

outer boundary (or beyond), costs and risks increase, arguably substantially—even 

in a nonlinear fashion. 

With a healthy respect for where that fuzzy zone begins, it’s typically feasible to 

depict the tradeoff space among attributes of a potential system quantitatively. Approaches to do so are available.4 They are not extensively utilized, but should be. 

Effective utilization will require appropriate ‘‘human capital’’ (perhaps capitalizing 

on what some of the Federally Funded Research and Development Centers can provide)—and a bureaucratic process sympathetic to their intent. The last will require 

significant leadership from the Department’s seniors. 

A complementary approach is to re-invigorate the use of Analyses of Alternatives 

(which will also require leadership from the Department’s seniors). The alternatives 

considered could include alternative bundles of the desired system attributes, thus 

illustrating the benefits, costs and risks of the tradeoffs involved. AoAs should respect the uncertainties of future operational environments, and of the fiscal limits 

under which the proposed system solution must be pursued, constraining the tradeoff choice to one that is realistic in the context of likely future budgets.5

A final promising ingredient is to encourage a series of ‘‘feedback’’ exchanges with 

those who will use the proposed system, requesting their vision(s) of how the system 

might be employed, recognizing the limitations of their abilities to foresee how that 

might actually develop. (The challenge is reflected in the allegation that had we 

asked cargo users what they wanted at the dawn of the automotive age, they might 

have replied ‘‘a faster, stronger mule’’!) 

Mr. THORNBERRY. To what extent is government systems engineering expertise 

available and applied in the requirements-setting process? To what extent should 

it be available and applied? 
125 

6See Coy, Peter, ‘‘The Little Engine that Could Reshape the Jet Engine,’’ Bloomberg Businessweek, October 19–25 edition. 

Dr. CHU. The Weapons System Acquisition Reform Act of 2009 appropriately mandated a resurrection of DOD developmental testing capacity, and improvements in 

systems engineering capacity, but the full realization of WSARA’s vision will require 

yet more effort. These two capacities should be foundational elements in the early 

DOD Milestone deliberations—they should have proverbial ‘‘seats at the table’’, perhaps more elevated seats than they currently enjoy. 

How much capacity is needed will differ by warfare area. Some of the needed capacity may be provided by the Federally Funded Research and Development Centers. There is unlikely to be an easy generalization about overall needs. 

Applying these capacities energetically will require the commitment of the acquisition community leadership, accepting the tensions that competing perspectives can 

generate. All concerned must be willing to accept some of the ‘‘hard truths’’ that 

these communities so often provide—especially about competing or incompatible ‘‘requirements’’. 

Mr. THORNBERRY. What capabilities or efforts may be needed to streamline the 

DOD’s requirements and acquisition review and approval processes to increase 

‘‘speed to market’’ or getting the right weapon systems from concept to fielding? 

Dr. CHU. As I testified, cycle time (presumably the motivation for streamlining) 

may not be quite the issue we imagine. But as I also testified, many of the oversight 

and reporting burdens are symptoms of the problem we face, not the cause. Government decisions, especially the high-profile decisions associated with major weapon 

systems, are inherently political. Given the decided lack of sympathy for error, we 

should not be surprised that managers at every level demand significant, careful review before each step is taken. In my judgment, a greater political tolerance for 

‘‘mistakes’’—an ‘‘error budget’’, so to speak—would eventually allow us to streamline 

the process. 

But we can also speed delivery by more frequently considering alternatives that 

update existing systems instead starting afresh. Modifying what we already have 

to aim at the desired performance (or cost) improvement should be a consistent option in Analyses of Alternatives. The relative success of the F/A–18 E/F program 

provides an example worth considering. It may also illustrate the limits of this approach. 

We can likewise start with articles developed outside the United States. The rapidity with which we could deploy the Mine Resistant Ambush Protected Vehicles 

illustrates the potential of this alternative—as well as its limitations. 

And perhaps most important, if we honor the limits of what’s technically realistic 

in the design tradeoff selected, as I argue in response to Question 3, and if we are 

faithful to what’s really needed in systems engineering and developmental testing 

(Question 4), we are much more likely to field articles expeditiously—articles that 

shine in their operational tests, and that live within the cost limits we need to impose. Indeed, as I speculate in response to Question 1, if we start with the desired 

fielding date as a key parameter driving program design, allowing adequate margin 

for incremental improvements, we may reach the result to which so many aspire— 

acknowledging that there are some technical developments that may require long 

periods of investment, notwithstanding the preference for quick results, as the history of the pure power geared turbofan aircraft engine demonstrates.6

Mr. THORNBERRY. What can be done to encourage more incremental development 

and deployment of weapon systems? 

Mr. PASQUA. Massive improvements in incremental development and deployment 

practices have been a major contributor to rapid growth in the Tech Industry over 

the past decade. There are several contributors to these improvements. First, there 

has been a move to the notion of ‘‘minimum viable product’’ or MVP. A MVP contains only those features which are required to meet key requirements while providing a basis on which new features may be added over time without re-engineering the entire platform. This allows products to get to market sooner, provide tangible customer value, garner feedback, and be enhanced to provide enhanced 

functionality that may not have been anticipated or prioritized before real usage. 

To make the MVP approach work, one must embrace a continuous deployment process. That is, it must be possible to enhance the deployed product rapidly without 

requiring major infrastructure changes or end-user retraining. Because this can be 

more difficult to do with hardware systems, more and more systems are ‘‘software 

defined’’. This allows the hardware to provide a flexible substrate that can be molded to meet new requirements with software. Incremental development can’t work if 

the specs/requirements are overblown to begin with or if there is no way to practically deploy incremental improvements. 
126 

Mr. THORNBERRY. What must change in the DOD acquisition process and culture 

to better transition technology from the ‘‘lab’’ to a program of record? 

Mr. PASQUA. Navigating a large bureaucracy can be difficult, but it can be 

achieved by finding a customer that demands a product. This takes the acquisition 

process out of the realm of the theoretical, and is achieved by strengthening the 

bond between the customer and the ‘‘lab’’ or the developer. There are two primary 

ways to achieve this. First, an organization can allow the lab to have greater access 

and contact to the end-users in the field. This may not be feasible, however, for a 

variety of reasons, including the risk of fielding unproven technology. Therefore, the 

second way is to bring the end-users into the lab. Often an end-user doesn’t actually 

know what he requires until a prototype is developed. Building a stronger connection to the lab allows the customer to provide rapid feedback on prototypes as they 

are developed. One of the benefits is not only the real time test and evaluation, but 

also the dialogue on what is possible. The operational work force may not have the 

technical knowledge to articulate challenges to consider for technical solutions because they are not informed on what are the current outer limits of technical capability. Bringing the lab to the field reduces that knowledge gap by bringing the 

science and technology closer to the problem, educating the operational work force 

on the realistic bounds of current capabilities, and illuminating operational challenges for the science and technology work force to provide vectors for innovation. 

Thus, better transitioning technology from the lab to the customer can be achieved 

by strengthening the bond between the two; in essence: bringing the lab to the field, 

or vice versa. 

Mr. THORNBERRY. What is needed to achieve integration of the requirements and 

acquisition processes in the DOD to facilitate requirements tradeoffs prior to acquisition programs being initiated? 

Mr. PASQUA. In larger organizations, often requirements are set and given to the 

developers without the latter being included in the requirements process. A stronger 

and more responsive feedback loop between the requirement setter and the developer is necessary to identify and reconcile any tradeoffs before a product is engineered and acquired. Often, organizations conduct market research to inform their 

requirements for a product. However, while all of those requirements may be true, 

they may not all be essential. Yet, because the developers are left out of the requirements process, they will engineer according to the requirements they are given, regardless of need (i.e. perhaps a 70% solution is sufficient) or cost (i.e. perhaps a 

100% solution would double the cost of the program). Absent a strong link between 

need and cost, there is a risk of over-engineering a solution or spending too much. 

To avoid this challenge, there should be a responsive feedback loop between the requirements setter and the developer. It should be part of the developer’s (or Research & Development team’s) responsibility to meet with the customer and agree 

on the need and cost before embarking on the acquisition process. Often, the larger 

the organization is the more specialization there is. This specialization only creates 

more layers between the developer and the customer, and risks weakening the link 

between need and cost. 

Mr. THORNBERRY. To what extent is government systems engineering expertise 

available and applied in the requirements-setting process? To what extent should 

it be available and applied? 

Mr. PASQUA. Although I am not in a position to comment on the availability of 

systems engineering expertise available within the Department, I can say that in 

the private sector the importance of having the expertise available is growing. The 

rapid deployment and iterative development of products and systems requires this 

expertise. In industry, we struggle with the question of how to build more modular 

and adaptable platforms that allow us to incorporate innovation over time. This is 

a systems engineering issue. For example, open architecture is now part of the lingua franca of software development and implementation. The same can and should 

be said for major Acquisition Category (ACAT) I programs. My sense is that should 

systems engineering expertise been available and applied during the acquisition 

cycle for the now cancelled USMC Advanced Amphibious Assault Vehicle (AAAV) 

program, outcomes may have been very different. As requirements grew in the development phase to ultimately unsustainable levels, a system engineering perspective could have identified the technological and fiscal impracticality of proposed adjustments before they were articulated to the contracted developer. 

Mr. THORNBERRY. What capabilities or efforts may be needed to streamline the 

DOD’s requirements and acquisition review and approval processes to increase 

‘‘speed to market’’ or getting the right weapon systems from concept to fielding? 

Mr. PASQUA. Industry looks like it is moving quickly because we are seeing the 

aggregate progress made by an entire ecosystem of organizations. Individually, 

many projects within these organizations fail, but the overall effect is fast forward 
127 

progress spurred on by competitive pressure. The DOD may benefit from an approach that allows more small scale experiments to occur quickly to ensure the feasibility of new approaches and their suitability to the requirements. There will be 

more small scale failures, but the ultimate result will be faster time to fielding of 

capabilities that are best suited to the needs. In some cases a ‘‘minimum viable 

product’’ approach should be employed that allows a capability to be fielded sooner 

and improved later. 

Mr. THORNBERRY. What additional steps are needed to ensure industry understands what the Department’s capability needs are for the future? 

Mr. PASQUA. Beyond Defense Contractors and specialized commercial organizations, there is very little understanding of the Department’s capability needs, how 

to learn them, and how to navigate the procurement process. Unless the last item 

is addressed, industry won’t feel a strong need to overcome the first two items. Having said that, outreach events including both academia and industry can be quite 

helpful. Establishing a network of individuals and organizations from industry who 

are co-sponsors of these events can help to attract the right attendees. For example, 

the Venture Capital community can be leveraged to bring new innovative companies 

from their portfolios to sessions to learn more about the Department’s needs. Organizations like BENS also have members with broad networks who could also help 

attract key participants. In addition to understanding the Department’s capability 

needs, I believe it would be valuable for industry to understand more about the missions to which these capabilities are in service. I find that once people understand 

the importance of the mission, they are more motivated to find a way that their organizations can contribute. 

Mr. THORNBERRY. What can be done to encourage more incremental development 

and deployment of weapon systems? 

Mr. FRANCIS. Greater discipline by DOD when setting requirements and when establishing business cases, as well as reinforcement through congressional oversight 

will be needed to encourage more incremental development and deployment of weapon systems. 

DOD will need to better integrate the requirements development and acquisition 

processes so that trade-offs informed by systems engineering take place before programs start. This will require a recognition by DOD officials that requirements cannot be truly set and a sound, incremental business case established until the requirements technical feasibility and affordability can be fully determined. Our recent work shows that DOD officials appear to recognize the need to take additional 

steps. We reported in June 2015 that ‘‘Several service chiefs noted that more integration, collaboration, and communication during the requirements and acquisition 

processes needs to take place to ensure that trade-offs between desired capabilities 

and expected costs are made and that requirements are essential, technically feasible, and affordable before programs get underway’’. 

In addition, every year, there is what one could consider a ‘‘freshman’’ class of 

new acquisitions. DOD and Congress must ensure that these programs embody the 

right principles and practices, such as incremental acquisition strategies, and make 

funding decisions accordingly. Through our reports and testimonies we have determined that a key enabler to getting better acquisition outcomes is establishing an 

incremental, knowledge-based acquisition strategy. However, there are strong incentives within the acquisition culture to overpromise a prospective weapon’s performance while understating its likely cost and schedule demands. Encouraging more incremental development and deployment of weapon systems will take the joint efforts 

of Congress and DOD. As I recently testified, the principles and practices programs 

embrace are determined not by policy, but by decisions. These decisions involve 

more than the program at hand: they send signals on what is acceptable. Programs 

that present well-informed acquisition strategies with reasonable and incremental 

requirements and reasonable assumptions about available funds should be given 

credit for a good business case and funded. Similarly, a few healthy ‘‘No’s’’ by DOD 

decision makers and Congress to programs that request to begin without a sound 

foundation, including incremental approaches, would go a long way toward shaping 

the expectations of programs and contractors as to what is acceptable. 

Mr. THORNBERRY. What must change in the DOD acquisition process and culture 

to better transition technology from the ‘‘lab’’ to a program of record? 

Mr. FRANCIS. DOD has long noted the existence of a chasm between its science 

and technology community and its acquisition community that impedes technology 

transition from consistently occurring. This chasm, often referred to by department 

insiders as ‘‘the valley of death,’’ exists because the acquisition community often requires a higher level of technology maturity than the science and technology community is willing to fund and develop. We have reported extensively on shortfalls 

across DOD’s technology management enterprise in transitioning technologies from 
128 

development to acquisition and fielding. In June 2005, we found that DOD technology transition programs faced challenges selecting, managing, and overseeing 

projects, and assessing outcomes. In September 2006, we found that DOD lacked the 

key planning, processes, and metrics used by leading commercial companies to successfully develop and transition technologies. In March 2013, we found that the vast 

majority of DOD technology transition programs provide technologies to military 

users, but tracking of project outcomes and other benefits derived after transition 

remained limited. More recently in November 2015, we found that programs 

progress through Defense Advanced Research Projects Agency (DARPA) without the 

agency head fully assessing whether transition strategies make sense. Such assessments, if measured against key transition factors, could improve a program’s potential for transition success. Transition responsibilities then fall almost exclusively on 

individual program managers, who are often not sufficiently trained to achieve the 

favorable transition outcomes they seek. Further, when the program manager’s tenure expires, the primary advocate for transitioning the program’s technology is also 

lost. This turnover increases the need for technical gains to be appropriately documented and disseminated so that user communities have visibility into potential solutions available to meet their emerging needs. An important part of this process 

is the tracking of transition outcomes, as we recommended DOD undertake for its 

technology transition programs in March 2013, and which we have also found lacking at DARPA. Our recent November 2015 review of technology transitions at 

DARPA offers a place to start. While there are a number of factors that determine 

whether a technology effort successfully transitions to a program of record, we found 

that science and technology development organizations should regularly assess technology transition strategies, improve transition training for Science and Technology 

program managers, and increase sharing of technical data on completed programs. 

Among the most significant factors that contribute to transition success are whether 

there is military or commercial demand for the planned technology, linkage to a research area of sustained interest by DARPA, active collaboration with potential 

transition partners and achievement of clearly defined technical goals. Finally, there 

is the issue of money. Technologies and concepts that are taken to a higher level 

of demonstration are more likely to transition to programs successfully. This is key 

to success in the private sector. But taking technologies to higher levels of demonstration is expensive. It is often difficult for DOD labs to afford such demonstrations. Conversely, programs of record have much higher levels of funding available, 

which creates incentives to transition technologies sooner than in the commercial 

world. This can have negative consequences for transition. For example, a program 

may be less willing to accept a technology that a lab has not been able to fund to 

higher levels of demonstration. Also, technologies that do transition early may cause 

problems for programs of record because they will still be going through the discovery process associated with higher levels of demonstration, with attendant discovery of problems and complications. While normal for technology demonstration, 

this is disruptive for a program of record that is operating within a formal cost and 

schedule baseline. 

Mr. THORNBERRY. What is needed to achieve integration of the requirements and 

acquisition processes in the DOD to facilitate requirements tradeoffs prior to acquisition programs being initiated? 

Mr. FRANCIS. This year’s NDAA took several steps to increase the role and formal 

authority of the service chiefs and ensure they are consistently involved in program 

decisions. In addition, as I testified to in 2013, DOD’s better buying power initiatives are also having a positive effect including making early trade-offs among cost, 

schedule and technical performance requirements. However, more can be done. Most 

current and former military service chiefs and vice chiefs GAO interviewed from the 

Army, Air Force, Navy, and Marine Corps in our June 2015 report collectively expressed dissatisfaction with acquisition program outcomes and believed that the Department of Defense’s (DOD) requirements development and acquisition processes 

need to be better integrated. Several service chiefs noted that trade-offs informed 

by systems engineering must take place before programs start so that requirements 

are better defined and more realistic cost, schedule, and performance commitments 

can be made. GAO recommended that DOD ensure sufficient systems engineering 

is conducted to better define requirements and assess resource trade-offs before a 

program starts. DOD concurred with the recommendations, citing recent policy 

changes. To the extent that service chiefs will be taking an increased role in program decisions, additional consideration should be given to whether they have received sufficient training and experience in acquisition as well as whether they have 

appropriate staff support to successfully execute these additional duties. Finally, 

DOD will need to ensure that it has sufficient workforce expertise to provide support during the requirements setting phase. In 2015 we reported that ‘‘. . . in areas 
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such as cost estimating and systems engineering, our work found that DOD may 

not have adequate resources to fully implement recent weapon system reform initiatives.’’ 

Mr. THORNBERRY. To what extent is government systems engineering expertise 

available and applied in the requirements-setting process? To what extent should 

it be available and applied? 

Mr. FRANCIS. DOD often does not perform sufficient up-front requirements analysis via systems engineering on programs to determine whether the requirements 

are feasible and whether there is a sound business case to move forward. Programs 

continue to be proposed with unachievable requirements and overly optimistic cost 

and schedule estimates and, usually, participants on both the requirements side and 

the acquisition side are loathe to trade away performance. Almost all of the service 

chiefs we interviewed in June 2015 stated that there is a need to further enhance 

expertise within the government, and several specified expertise in systems engineering. Several service chiefs indicated that systems engineering capabilities are 

generally lacking in the requirements development process, and do not become 

available until after requirements are validated and an expensive and risky system 

development program is underway. Some service chiefs advocated that having systems engineering capabilities available to the military services during requirements 

development could help to ensure earlier assessment of requirements feasibility. The 

service chiefs’ views on the importance of systems engineering is consistent with our 

prior acquisition work. We recommended that DOD ensure sufficient systems engineering is conducted to better define requirements and assess resource trade-offs before a program starts. DOD concurred with the recommendations. 

Mr. THORNBERRY. What capabilities or efforts may be needed to streamline the 

DOD’s requirements and acquisition review and approval processes to increase 

‘‘speed to market’’ or getting the right weapon systems from concept to fielding? 

Mr. FRANCIS. The process used to manage the acquisition of weapon systems is 

inefficient, cumbersome, and bureaucratic. A contributing factor to this inefficient 

process is the significant time and effort required to complete information requirements before an acquisition program can proceed through a milestone to the next 

phase in the weapon system acquisition process. DOD leadership has acknowledged 

that too much time is invested in preparing for key milestones, including the documentation and oversight of information required by statutes and policy, which takes 

time away from conducting day-to-day core program management tasks such as contractor oversight, engineering, and risk management. 

We surveyed 24 programs in February 2015 and found that it took DOD over 2 

years on average to complete the entire set of documents required for review and 

approval at key decision points. In the end, program officials felt almost half of 

these information requirements were not of high value. The challenge is to find the 

right balance between having an effective oversight process and the competing demands such a process places on program management. If information requirements 

and reviews are not clearly linked with the elements of a sound business case and/ 

or the key issues facing acquisitions today, then they can be streamlined or even 

eliminated. If they are linked, but are not working well, then they warrant re-thinking. These requirements, as well as ones that take a year or more to complete, could 

serve as a starting point for discussions on what documentation is really needed for 

weapon acquisition programs and how to streamline the review process. If DOD 

does not eliminate levels of review, but only makes the existing process more automated, inefficiencies are likely to continue. 

We recommended that, in the near term, DOD identify and potentially eliminate 

(1) reviews associated with information requirements, with a specific focus on reducing review levels that do not add value, and (2) information requirements that do 

not add value and are no longer needed. We also recommended that, as a longerterm effort, select several current or new major defense acquisition programs to 

pilot, on a broader scale, different approaches for streamlining the entire milestone 

decision process, with the results evaluated and reported for potential wider use. 

DOD concurred with both recommendations. A place for the committee to start 

would be to monitor DOD’s progress implementing these recommendations. 

Users may well be willing to live with a less ambitious set of technical outcomes 

than those at which the technical community is aiming. Or they may want something more, reflecting changes in the operating environment since designs were 

originally considered, sending us back to the trade space drawing board. 

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