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94–089 2016

[H.A.S.C. No. 114–2] 

A CASE FOR REFORM: IMPROVING 

DOD’S ABILITY TO RESPOND TO THE 

PACE OF TECHNOLOGICAL CHANGE 

COMMITTEE ON ARMED SERVICES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

FIRST SESSION 

HEARING HELD 

JANUARY 28, 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 

STEVEN M. PALAZZO, Mississippi 

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 

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 

JOHN WASON, Professional Staff Member 

DOUG BUSH, Professional Staff Member 

AARON FALK, Clerk 
(III) 

C O N T E N T S 

Page 

STATEMENTS PRESENTED BY MEMBERS OF CONGRESS 

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

Committee on Armed Services ............................................................................ 4 

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

Committee on Armed Services ............................................................................ 3 

WITNESSES 

Kendall, Hon. Frank, Under Secretary of Defense for Acquisition, Technology 

and Logistics, U.S. Department of Defense ....................................................... 4 

Ramsay, Lt Gen Mark F., USAF, Director, Force Structure, Resources and 

Assessment, J8, Joint Staff ................................................................................. 6 

APPENDIX 

PREPARED STATEMENTS: 

Kendall, Hon. Frank ......................................................................................... 45 

Ramsay, Lt Gen Mark F. ................................................................................. 59 

Thornberry, Hon. William M. ‘‘Mac’’ ............................................................... 43 

DOCUMENTS SUBMITTED FOR THE RECORD: 

[There were no Documents submitted.] 

WITNESS RESPONSES TO QUESTIONS ASKED DURING THE HEARING: 

Mr. Peters ......................................................................................................... 69 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING: 

Mr. Cook ............................................................................................................ 78 

Mr. Gibson ......................................................................................................... 77 

Mr. Rogers ......................................................................................................... 74 

Mr. Shuster ....................................................................................................... 75 

Mr. Turner ........................................................................................................ 73 

(1) 

A CASE FOR REFORM: IMPROVING DOD’S ABILITY TO 

RESPOND TO THE PACE OF TECHNOLOGICAL CHANGE 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON ARMED SERVICES, 

Washington, DC, Wednesday, January 28, 2015. 

The committee met, pursuant to call, at 9:33 a.m., in Room 2118, 

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

(chairman of the committee) presiding. 

The CHAIRMAN. The committee will come to order. Let me welcome all the members, witnesses and guests to the first formal 

hearing of this committee in the 114th Congress. 

Before we turn to our witnesses and the topic of the day, Mr. 

Smith and I want to take a brief moment to welcome and to introduce the new members of the committee. The brevity of our introductions is no indication of the talent that the new members bring. 

It is simply a function of our time limitations. We are going to have 

votes here in a little bit, but I do want to take a moment to welcome our new folks. 

On the Republican side, there are six new members, starting 

with Sam Graves, who represents the Missouri’s Sixth District and 

is joining us after completing his term as the chairman of the 

House Small Business Committee. He has worked with us on those 

issues before and will be a huge asset as we continue to work 

through a lot of the issues that we are going to be talking about 

today. 

Next is Ryan Zinke, who represents Montana’s At-Large District, 

a 23-year-old veteran of the Navy and former Navy SEAL [Sea, Air, 

Land] commander with combat tours in Iraq. So he brings lots of 

experience, but I am told his most important role is that of a proud 

Navy dad, which we all understand. 

Elise Stefanik is representing New York’s 21st District and Fort 

Drum, home of the 10th Mountain Division. The youngest woman 

ever elected to the House, she also knows her way around Washington, having served in the Bush White House and at the Foreign 

Policy Institute. 

Martha McSally represents the Second District of Arizona, home 

of Fort Huachuca and Davis Monthan Air Force Base. She is a retired Air Force colonel, a combat aviator, and the first woman to 

command an A–10 squadron, and flew multiple missions in Iraq. 

Steve Knight represents California’s 25th Congressional District. 

Born in Edwards Air Force Base, he has served in the Army, also 

as a Los Angeles police officer and as a State senator. He has a 

wealth of knowledge on the rich aviation tradition of that district, 

which we will take advantage of. 
2 

And finally, Tom MacArthur represents southern New Jersey’s 

Third District, home of Joint Base McGuire-Dix. A former mayor 

of Randolph, New Jersey, Tom has over 30 years of business experience in the insurance industry. And we certainly look forward to 

putting those skills to work here at the Armed Services Committee. 

So let me welcome the six new members on our side and yield 

to the distinguished ranking member, Mr. Smith. 

Mr. SMITH. Thank you, Mr. Chairman. 

We have actually nine new members on our side of the aisle. I 

want to welcome them. We have two who are veterans of the Congress joining the committee and then seven new members. 

Tim Walz is our first member from Minnesota. He is currently 

serving his fourth term representing Minnesota’s First Congressional District. He enlisted in the Army National Guard at the age 

of 17 and retired 24 years later as a command sergeant major and 

has done a ton of work on veterans issues, served on that committee previously. And we have worked closely together. 

Beto O’Rourke is from Texas. He was elected to represent the 

people of the 16th District of Texas in November of 2012. Prior to 

his congressional service, Beto O’Rourke served two terms on the 

El Paso City Council and represents Fort Bliss in El Paso. 

Donald Norcross from New Jersey was sworn in to the 113th 

Congress to represent New Jersey’s First Congressional District. 

He previously served in both the New Jersey General Assembly 

and State Senate, where he developed a reputation as an effective 

bipartisan reformer. Those are, you know, two words—‘‘bipartisan’’ 

and ‘‘reformer’’—that will fit well on this committee. 

So, welcome. 

I think some of our other Members are not here, but I will go 

ahead and introduce them in absentia anyway. 

Ruben Gallego of Arizona is the son of Hispanic immigrants, a 

veteran and a community leader. He was the first in his family to 

attend college and later joined the Marine Corps, serving in Iraq 

with the well-known combat unit Lima 3/25. 

Mark Takai of Hawaii was elected to Hawaii’s First Congressional District, which was vacated when Colleen Hanabusa decided 

to run for the United States Senate. He serves in the Hawaii Army 

National Guard as a lieutenant colonel and took part in Operation 

Iraqi Freedom in 2009. 

Gwen Graham represents Florida’s Second Congressional District. She is the daughter of Bob Graham, former United States 

Senator and Governor. She worked for her local school district and 

is also proud to represent Tyndall Air Force Base in the Second 

Congressional District. 

Brad Ashford of Nebraska represents Nebraska’s Second District, 

and from 1987 to 1995, he was a judge in the Nebraska Court of 

Industrial Relations and then served in the State Senate until he 

was elected to Congress. 

Seth Moulton of Massachusetts represents Massachusetts’ Sixth 

Congressional District; graduated from Harvard in 2001 with a 

bachelor of science in physics. He joined the United States Marine 

Corps; served four tours in the Iraq War; and between those tours, 

earned his master’s degrees in business and public administration 

in a dual program at Harvard University. 
3 

And last is Pete Aguilar, who represents California’s 31st District. And from 2010 to 2015, he served as the mayor of the city 

of Redlands. Prior to that, he was the youngest member ever to 

serve in the Redland City Council’s 140-year history. 

So we have a lot of new members. Welcome to the committee. I 

look forward to working with all of you. 

And, with that, I yield back. 

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

The CHAIRMAN. I thank the gentleman. 

And I want to just say again how much I appreciate the talent, 

the experience and the dedication that all the new members on 

both sides of the aisle bring to this committee. We are going to be— 

I can already tell, you are going to enhance our deliberations and 

decisions, and I am really glad to have you all here. 

It is also true there were many more members who wanted to 

be on this committee than we had room for, but we definitely got 

the cream of the crop. 

Let’s turn now to the subject of our hearing today. The subject 

is technological superiority, how the U.S. is doing and how we can 

ensure that we have the technological edge we need for the years 

to come. 

And I would ask unanimous consent that my full opening statement be made part of the record. 

Without objection, so ordered. 

I would just say the Constitution puts on the Congress the responsibility to provide and maintain, to raise and support military 

forces that can defend the country. And as we try to do that in this 

day and time, we have a number of challenges, one of which is that 

we face more different kind of challenges than maybe we ever have 

before. Another is that technology is moving incredibly quickly. 

And a third is that some potential adversaries or competitors are 

putting a lot of time, effort, and money into creating vulnerabilities 

for us. 

And then another challenge can be our own system. And so that 

is part of the reason I think it is important for us to look, as we 

have been this week, at what is happening in the world and then 

look at what we can do to improve things, and that is part of the 

reason defense reform is going to be a significant part of our agenda. 

So I really appreciate the witnesses we have today: Under Secretary of Defense Frank Kendall, who is leading the Department’s 

efforts in a number of respects in this topic; and also General 

Ramsay, who is the Joint Staff Director for Force Structure, Resources and Assessment. 

It just seems to me the key question before us is: What should 

we in Congress do to ensure that America has the technological superiority we require so that we meet the Nation’s needs and the 

demands of our time? 

I would yield to Mr. Smith. 

[The prepared statement of Mr. Thornberry can be found in the 

Appendix on page 43.] 
4 

STATEMENT OF HON. ADAM SMITH, A REPRESENTATIVE FROM 

WASHINGTON, RANKING MEMBER, COMMITTEE ON ARMED 

SERVICES 

Mr. SMITH. Thank you, Mr. Chairman. 

I appreciate you holding this very important committee. 

I welcome Mr. Kendall and General Ramsay. And this is an incredibly important topic. Acquisition reform has always been a 

challenge at the Department of Defense [DOD]. We are always 

seeking ways to improve it, but I think it is particularly important 

in the environment that we find ourselves in, which combines two 

unfortunate elements. One, an expanding and very confusing 

threat environment: We cannot say that things are getting less 

threatening or we have fewer national security challenges in the 

world. It is going in the opposite direction, and at the same time, 

they are incredibly complex. 

And that is combined, of course, with a shrinking budget and the 

challenges of sequestration and the challenges of the reductions in 

the budget, and also, I might add, the challenges the government 

shutdown, the CR’s [continuing resolutions]. Basically from one 

month to the next, you have frequently, over the course of the last 

4 years, not known how much money you were going to have to 

spend, or where. So, in that type of environment, the better we 

spend that money, the better off we are going to be. 

So I know this is something that has been a huge priority for Mr. 

Kendall since he joined the Department of Defense, figuring out 

ways to buy equipment more quickly, more efficiently, make sure 

we get more out of it, because we have a history over the last decade that is not pretty when it comes to a lot of money being spent 

in ways that did not turn out well, wasted money on a variety of 

different programs. 

I want to particularly thank Mr. Thornberry for his leadership 

on this issue. It is something he has worked on for a long time on 

the committee. I think he understands it better than anybody and 

is perfectly positioned to lead the effort to try to reform our acquisition process. 

And with that, I look forward to the witnesses’ testimony, the 

questions and answers from the panel. 

I yield back. 

The CHAIRMAN. I thank the gentleman. 

Again, Mr. Kendall, thank you for being here. The floor is yours. 

STATEMENT OF HON. FRANK KENDALL, UNDER SECRETARY 

OF DEFENSE FOR ACQUISITION, TECHNOLOGY AND LOGISTICS, U.S. DEPARTMENT OF DEFENSE 

Secretary KENDALL. Thank you, Mr. Chairman. 

Chairman Thornberry, Ranking Member Smith, members of the 

committee, I would like to begin by thanking the committee for its 

willingness to work with the Defense Department on ways to improve the productivity and effectiveness of defense acquisition. 

I request that my written statement and the accompanying materials, which provide details on our acquisition improvement efforts, 

be admitted to the record. 

The CHAIRMAN. Without objection, so ordered. 
5 

Secretary KENDALL. The acquisition improvement initiatives that 

the Department undertook beginning in 2010, when Dr. Carter was 

Under Secretary for Acquisition, Technology and Logistics and I 

was his principal deputy, initiatives that we called Better Buying 

Power, have evolved as we have learned from our experience and 

gathered data on the effectiveness of our policies. 

We are currently close to issuing guidance implementing what 

we call Better Buying Power 3.0, released last year in draft; 3.0 

builds upon core aspects of earlier versions that emphasize strong 

performance incentives, competition, and professionalism in our acquisition workforce, and close and continuous interaction with acquisition and requirements community, which is represented here 

today by General Ramsay, the J8 from the Joint Staff. 

Better Buying Power also emphasizes elimination of unproductive bureaucracy. The rules our program managers must follow are 

still too complicated and burdensome. I know the committee leadership shares this view, and I am happy to say that the administration will soon formally submit several legislative proposals designed to address this problem to both the House and the Senate 

Armed Services Committees. I am providing those proposals informally to the committee today. The Department looks forward to 

working with the committee on these proposals. 

Better Buying Power 3.0 continues the core aspects of earlier 

versions, which shifts our focus towards technical excellence and 

innovation. It is a response to the technological superiority concerns that the chairman mentioned. We have provided the members with a 1-page summary, which you should have in front of 

you. 

As I have testified to before this committee previously, I am very 

concerned about the increasing risk of loss of U.S. military technological superiority. I was also recently asked to provide an input to 

the Senate Homeland Security and Government Affairs Committee 

on areas in which the Congress could help the Department improve 

acquisition outcomes. I would like to summarize my submission for 

this committee. 

Number one, and number one by a very wide margin, end the 

threat of sequestration. As the leadership mentioned, this is a huge 

problem for the Department. The uncertainty associated with our 

ability to plan without knowing what our future budgets would be 

with any confidence and the inadequate resources that sequestration levels would provide are enormous problems for the Department. 

Number two, continue to support the Defense Acquisition Workforce Development Fund. This fund is a valuable tool for improving 

the professionalism of the acquisition workforce. 

Number three, work with the Department to simplify the rules 

we already have. Mr. Chairman, Ranking Member, and I have discussed previously, we can eliminate a great deal of unproductive 

overhead and confusion by simplifying the rules governing acquisition today. The recommendations we are providing to the committee go a long way in that direction, and hopefully, we will be 

able to implement those. 

Number four, avoid highly restrictive rules that limit Department freedom of action. The Department implements an almost in-
6 

finitely varied set of business arrangements with industry, and we 

need the flexibility to tailor our contracts consistent with all the 

various types of situations that we face, which cover a very wide 

set of different options. 

Number five, reduce the counterproductive incentive to obligate 

funds on a fixed schedule. In any negotiation, time is a factor that 

works to one side’s advantage. Rigid time-based obligation requirements automatically work against the Department in our negotiations. 

Number six, allow the Department to hold a management reserve to apply to programs that realize risks. Under current practice, programs that are performing well often have to be the 

sources of funds to repair poorly performing programs. 

Number seven—and I would use this as the other bookmark, if 

you will, to the set of inputs—help the Department improve the 

professionalism of the government workforce. I believe this area 

has the greatest potential over the long term of improving acquisition outcomes. I have worked on and led some well-led and some 

not-so-well-led programs in industry and in government. Leadership and professional skills honed over decades do matter, perhaps 

more than any other factor that we can influence. 

Again, I would like to thank the committee for its cooperation 

and support. Our warfighters and taxpayers deserve the best performance we can possibly achieve from the acquisition system. I 

know you are all equally committed to that goal. Thank you. 

[The prepared statement of Secretary Kendall can be found in 

the Appendix on page 45.] 

The CHAIRMAN. Thank you. 

General Ramsay, do you have an oral statement you would like 

to give or—— 

General RAMSAY. I do, Mr. Chairman. And if I could also request 

that my written statement be submitted for the record. 

The CHAIRMAN. Without objection. 

STATEMENT OF LT GEN MARK F. RAMSAY, USAF, DIRECTOR, 

FORCE STRUCTURE, RESOURCES AND ASSESSMENT, J8, 

JOINT STAFF 

General RAMSAY. Chairman Thornberry, Ranking Member 

Smith, and distinguished members of the committee, I appreciate 

the opportunity to testify before you today. As the Director for 

Force Structure, Resources and Assessments, I provided insights in 

my written statement into the Joint Staff’s role in requirements 

generation and capabilities development process, specifically highlighting the close interaction and linkages between requirements 

and other Department process to include the defense acquisition 

system that Mr. Kendall oversees. 

The Joint Requirements Oversight Council, the JROC, is charged 

to identify, assess, and prioritize military capability needs. And the 

Joint Capabilities Integration and Development System, or JCIDS, 

is the process that enables the JROC to meet our statutory responsibilities. 

I want to thank the work of this committee as well as the Senate 

Armed Services Committee for providing reforms in recent years 

that added emphasis on our analysis of risk, cost, and schedule 
7 

very early in program development; established a deliberate, urgent, and emergent requirements lanes to better respond to our 

warfighter operational user needs; and to enable us to consolidate 

guidance documents, streamline our procedures, and mandate 

shorter document length and staffing timelines. 

These reforms also shaped the JROC into a lean decisionmaking 

body chaired by the Vice Chairman of the Joint Chiefs of Staff, 

with the service Vice Chiefs and Assistant Commandant of the Marine Corps serving as statutory members. The combatant commanders also participate based on interest in each program. 

Statutory advisors include Mr. Kendall as well as the Under Secretaries of Defense for Policy and the Comptroller, the Director of 

Operational Test and Evaluation, and the Director of Cost Assessment and Program Evaluation. 

In the execution of the JROC’s duties, we work very closely with 

all stakeholders to manage an agile and responsive requirements 

process that is intertwined with other key decision processes across 

the Department of Defense. 

Our ultimate goal in the JCIDS process is to ensure that we remain agile and responsive and innovative so the Department can 

develop and deliver operationally and cost-effective capabilities to 

the joint force to help achieve our Nation’s strategic and military 

objectives. 

Thank you, and I look forward to your questions. 

[The prepared statement of General Ramsay can be found in the 

Appendix on page 59.] 

The CHAIRMAN. Thank you. 

And let me just say, I very much appreciate the working relationship that we have had over the past year or so, Mr. Kendall, with 

you and your team. 

But also, Mr. Smith, this is—he has been integral to everything 

we have tried to work on. This has been completely bipartisan, as 

well as working with the Pentagon, as well as working with the 

Senate. And I think all of us recognize that it is going to take all 

of us collaborating, working together to improve this system because it very much is like changing an airplane engine while the 

engine is in flight. We still have to defend the country while we 

look to make improvements. 

And I particularly appreciate, Mr. Kendall, you sending up legislative proposals ahead of the budget. I think that is something that 

is unusual. I think it shows the seriousness with which at least you 

and the folks at the Pentagon take this issue. So, thank you. That 

helps us get a head start. 

The one question I want to pose to you is this: As you know, we 

have had some classified and unclassified sessions for members 

this week about, where are we? Technological superiority: Are we 

ahead? How much? Are we losing it? Just kind of the state of technology, especially versus near-peer-type competitors. 

We obviously can’t talk specifics in an open session, but I am just 

wondering how you would characterize where we are and what concerns you for the American people. Kind of in layman’s language, 

where do you think we are as far as the country’s technological superiority and what concerns you? 

Mr. KENDALL. Thank you, Mr. Chairman. 
8 

We are at risk, and the situation is getting worse. I came back 

to the Pentagon in 2010, after being away for about 15 years. And 

the intelligence estimates when I left in 1994 were that China was 

really not much of a problem for us, but in 10 or 15 years, they 

possibly could be, based on their economic rate of growth at that 

time. 

I came back, and the intelligence estimates were correct. And I 

became, I think it is fair to say, alarmed as soon as I started seeing 

technical intelligence reports on China’s modernization programs. 

And I can say the same of Russian’s modernization programs as 

well. 

We came out of the Cold War with a very dominant military. We 

demonstrated that military conclusively in the First Gulf War, and 

we have used it very effectively against any conventional force in 

the period since. Since 2001, we have been involved in counterinsurgency and counterterrorism campaigns, which are very different 

kinds of threat. 

No one observed more carefully the dominance that we demonstrated in 1991 than the Chinese. And we demonstrated what 

Bob Work calls the ‘‘second offset strategy,’’ which is the capability 

of precision munitions, in particular, but also stealth, networked 

forces, and wide-area surveillance, and technologies, which in an 

integrated fashion, gave a very dominant capability to our forces. 

People have had a long time; that was long time ago. People have 

had quite a bit of time to think about and to do things about how 

to defeat that force. And what I am seeing in foreign modernizations, again, particularly China’s, is a suite of capabilities that are 

intended clearly, to me at least, to defeat the American way of 

doing power projection, American way of warfare, when we fight in 

an expeditionary manner far from the United States. Our systems 

depend upon what I would call a few high-value assets, and I 

would start with space-based assets, satellites, which in relatively 

small numbers provide important functions for intelligence, targeting, and communications; and I would include aircraft carriers, 

which are the basis for our naval power projection, which we have 

a small number; and airfields, which are the basis by which the Air 

Force is able to project power, using mostly fighter aircraft. 

Those targets that those represent to an adversary are finite. 

They are there in limited numbers. And the precision munitions 

revolution that we demonstrated has been emulated by others. So 

if I were to worry about one aspect of the threat, I would start by 

talking about missiles, both ballistic and cruise missiles. They have 

attacked those high-value assets. 

I was an Army air defender years ago. And our best air defense 

systems could get maybe a 70 percent probability of kill; if you 

were good, maybe a 90 percent probability of kill against one incoming airplane or missile. It doesn’t take much to do the math to 

figure out that if you send a large number of missiles against a single asset that you are going to get some through. And once those 

missiles become highly accurate and can kill the thing that you are 

trying to attack if they penetrate, then you have a problem. That 

is the change that has occurred. And we pioneered that change, but 

it has now been emulated by others. 
9 

And, without saying too much about this, the Chinese, in particular—and, again, to a lesser extent, the Russians—are going beyond what we have done. They are making advances beyond what 

we currently have fielded, and it is designed to threaten largely 

those various high-value assets. 

Now, the Department is recognizing this. Dr. Carter, who is here 

and will be next week, I think, and I have talked about this briefly. 

He understands it. Bob Work understands it. Secretary Hagel understands it. So we have been doing some things to try to address 

this problem, but we also have global commitments, we also have 

readiness concerns, and we also have the threat of sequestration in 

front of us. So this is a serious problem for the country. And I gave 

testimony here last year where I talked about the U.S. being challenged in an unprecedented way. It is not just missiles. It is other 

things, such as electronic warfare capabilities; it is antisatellite capabilities, a spectrum of things to defeat our space systems. It is 

a number of things which I think are being developed very consciously to defeat the American way of projecting power, and we 

need to respond to that. 

The CHAIRMAN. Well, thank you. I just think it is important to 

emphasize the need to improve our acquisition process is not just 

about saving money; it is about this problem of change that is 

going faster and faster that we are having trouble keeping up with. 

Mr. Smith. 

Mr. SMITH. Thank you, Mr. Chairman. 

Just one straightforward question on acquisition reform. A lot of 

it is what goes on within the Pentagon, the culture of the decisions 

that are made, you know, all kinds and restructure, but from a legislative standpoint, as we here get ready to try to put together an 

acquisition reform package, what authority don’t you have that you 

would like to have? What changes in the law can we give you that 

would give you the flexibility to do some of the things that you and 

Mr. Thornberry just talked about? 

Secretary KENDALL. Thank you, Ranking Member. Congressman, 

I generally have the authorities that I need. 

I don’t think our problem is authorities. I think our problem has 

more to do with implementation of the things that we have. And 

that is why I emphasize professionalism in our workforce so much. 

We need to give our people the tools and the training, the experience they need to do their jobs well. And then we need to get out 

of their way a lot of things that make it harder for them to do their 

jobs. 

I spoke to Navy Admiral Dave Lewis a couple of years ago, he 

is a PEO, program executive officer, with the Navy. And he told me 

that he was most effective as program manager when he was running the DDG–51 Destroyer Program when he had a multiyear 

contract, because he could focus entirely on managing that contract 

and managing the performance of industry to do a better job of delivering product to the Navy. And what was different, of course, in 

the multiyear contract environment that he was in was he didn’t 

have to come in for repeated staff reviews all the time that took 

up all of his time and distracted him from actually doing his job. 

I took that to heart, and I think we really need to work hard to 

relieve some of the burdens that we are imposing on our program 
10 

managers and our acquisition workforce. They are well-intentioned. 

And a lot of the recommendations that we have prepared and 

brought over to the committee go along those lines. They relieve 

some of the burdens that are on our people. 

Developing the professionalism of the workforce is a task that 

takes time. And I want to compliment our workforce. We have, I 

think, an exceptionally capable and professional workforce, but it 

can be improved. We have a workforce where the demographics are 

a bit troubling. We have a lot of people close to retirement and a 

lot of young people who just came in, and kind of a bathtub in the 

middle. We have to manage our way through that. So we need tools 

to build up that workforce and make it more capable over time. 

And we would like the help of the committee on that in particular. 

Mr. SMITH. Yeah, one of the complaints that we hear all the time 

from industry in terms of, you know, specifically going over budget 

on projects is the amount of overseers, regulators that they have 

to deal with on a day-in-and-day-out basis, that that drives a lot 

of their cost. I have talked to a lot of people about this in the think 

tank world, and they say, you know, true or not, live with it, because it is not changing. But it seems to me like if it is something 

that is that big a problem, we ought to focus on it. And their argument is they spend more time trying to justify every decision they 

are making than actually doing their work. 

Do you see this as a problem? Are there too many bureaucrats, 

you know, overseeing the making of our military equipment in a 

duplicative fashion that is not actually helping? 

Secretary KENDALL. The short answer is, no, but I think we can 

improve in that regard. We have been working for the last few 

years with our Department’s auditors, who don’t report directly to 

me but have worked with me very closely on this. There is a very 

large backlog of audits that needs to be done. That basically is a 

problem for us. 

There is a problem with using statistical audits as opposed to 

complete audits and finding ways to be more effective on how we 

focus the resources that we have. The Defense Contract Management organization—that does report to me—supervises our contractors. And I think we have to strike a balance there. I don’t think 

we are vastly off on that. I don’t think that is a core problem for 

us. We recover quite a bit of money through our auditing process 

each year, much more than the auditing costs us. We do find quality problems, and you will read reports about those occasionally in 

the press. And so we do have to have some level of that. 

I don’t think our balance is all that far off, but I do think we can 

improve. 

Mr. SMITH. Okay. 

Thank you, Mr. Chairman. I yield back. 

The CHAIRMAN. Thank you. 

Mr. Wilson. 

Mr. WILSON. Thank you, Mr. Chairman. 

And thank both of you for being here today. 

General Ramsay, the acquisition workforce is actively managed, 

including providing a number of incentives and career path opportunities. How does that compare with the requirements workforce? 
11 

Do you have any recommendations for improving the career management of the requirements workforce? 

General RAMSAY. Thank you, Congressman Wilson. 

Thanks to the work of this committee about—about, I think it 

was 2007—there was statutory requirement, just as the acquisition 

workforce, for a requirements workforce that was more professional. So we now have a five-level certification program required 

for all the folks who touch requirements, whether they are military 

or civilian, to go through Defense Acquisition University. One of 

those programs is for senior leader requirements. I went through 

that program 21⁄2 years ago when I took that job. So we think we 

have got a very robust program that goes back now. We implemented this starting in the beginning of fiscal year 2008, so the 

workforce we have in place is much—they are a professional workforce. They obviously rotate out probably more than the acquisition 

managers do because many of these folks are wearing uniform like 

I am. But the folks that come into this process have various certification process. So the short answer is I think we are right where 

we need to be, and we are getting better with time. 

Mr. WILSON. That is encouraging. 

And, Mr. Kendall, thank you for raising concerns about threats 

to our country. And, we are not just talking about money; we are 

talking about being technologically ahead to protect the American 

people, and thank you for raising that. 

Additionally, we do see that the Small Business Innovative Research program as an important tool of the Department to tap into 

vital innovative technologies from small businesses. What actions 

can the Department take to improve the utilization of the program, 

especially the use of Phase III’s integrated into a larger acquisition 

program of record? 

Secretary KENDALL. Good question, Congressman. We are looking at that program. It has been a very successful program. We get 

fairly good transition rates, but there are some issues with it. The 

amount of time it takes to get an award, and getting from one 

phase to the other, and then getting into where you are actually 

producing things has been a problem historically. 

We are looking at—if you look at the sheet of paper you have in 

front of you, under ‘‘Better Buying Power 3.0,’’ we are looking at 

all of the different categories of research and development spending 

that we have, and I have teams working those right now, including 

things like Small Business Innovative Research and Rapid Innovation Fund, for example, and our other areas of contract at R&D [research and development] as well as independent R&D that industry does. We need to try to get as much as we can out of each of 

those individual pots of money, if you will. So we are looking at 

that hard now, and we will be coming back with some recommendations in the next few months on that. 

Mr. WILSON. Well, good program, and however we can improve 

it, we appreciate that. 

In meeting with service acquisition executives earlier this week, 

they recommended spending more time at front end of a program, 

such as thorough market research, modeling, and simulation for 

trade space analysis, developmental planning, and technology mat-
12 

uration. They described a process where more time would be spent 

early in the process but which would save time overall. 

Do you support that recommendation? What recommendations do 

you have to make the process to do a better job? 

Secretary KENDALL. I do agree with that. I think it is very important we take the time upfront to make sure we have got it right, 

particularly in a time of scarce resources, as we cannot afford new 

starts that are false starts. When we start a program, we should 

be reasonably confident that we are going to take it through to 

completion and field the capability. And doing the system engineering upfront, doing the requirements tradeoffs upfront, making sure 

the programs are affordable, these are all very, very important. 

Making sure the business strategies and risk mitigation plans are 

appropriate is incredibly important. So I agree with that comment. 

That is one of the things we are trying to do. 

Mr. WILSON. And you have already referenced this, but it is so 

important, on page 3 of your testimony, quote, ‘‘Russia and others, 

such as Iran, are also fielding precision missiles and other capabilities that threaten our power projection capabilities,’’ end of quote. 

And I think, again, if you could restate your concerns, the American people need to know this. 

Secretary KENDALL. The concern is that we are dependent upon 

a very small number of what I call high-value assets to implement 

conventional military power, generally far from the shores of the 

United States. And as you get closer to someone else’s homeland, 

their ability—they have certain advantages at that point. They 

have, obviously, land-basing for their systems. They can have mobile systems that are hard for us to target. We have a small number of assets which are carrying the bulk of our power projection 

capability forward. They are either Air Force bases that are already in the region, or they are carriers and carrier strike groups 

that are coming forward. And if you can target those and attack 

them with precision missiles, then you have a significant advantage. That is the situation we are increasingly facing. 

Mr. WILSON. Thank you very much. 

The CHAIRMAN. Thank you. 

Mr. Courtney. 

Mr. COURTNEY. Thank you, Mr. Chairman. 

And thank you to the witnesses. 

Last Saturday, one of the drumbeat of snowstorms up in New 

England, all of my events were cancelled, and I finally got a chance 

to sit down and watch the PBS special on Hyman Rickover, which, 

again, I would encourage all members to review because it really 

is squarely in the sweet spot of what we are talking about here 

today. And he, obviously, was an innovator and a maverick. That 

is almost an understatement. He, obviously—the movie—the documentary is more about almost his struggles with the bureaucracy 

than it was with the technology of building nuclear-powered aircraft carriers and submarines. 

And two of your initiatives are focused on innovation: One is the 

DARPA [Defense Advanced Research Projects Agency] initiative, 

and then is the acquisition reform. And I was trying to visualize 

reading that how Hyman Rickover, who I think has still provided 

us with undersea dominance based on what he did 60 years ago, 
13 

you know, would function today and how you see that as sort of 

trying to nurture that kind of amazing creativity that will help us 

with this technological gap that we are facing. 

Secretary KENDALL. Rickover established a lasting culture and 

tradition in the Navy, a nuclear power Navy, which I think everyone should admire. It is a terrific organization. He was also very 

much a person who is—a very strong engineering background, very 

strong leadership model. I think we could emulate a lot of that, and 

we should be. When I talk about developing professionals, he is the 

sort of person that I have in mind. 

Everybody can’t be a maverick, obviously, but you do have to— 

I find myself constantly trying to beat back the bureaucracy, which 

has a tendency—if you have looked at any of the literature on bureaucracies and how they grow, there are certain rules where all 

bureaucracies sort of self-perpetuate and increase their size over 

time. And it is just a constant struggle to push back on that and 

to try to make sure that people focus on substance as opposed to 

form in the things that we do. It is one of the reasons we are asking for some of the legislative reforms that we are asking for, to 

try to get rid of some of those bureaucratic tools and replace them 

with things that are more substantive. So I generally agree with 

your point about that. It is consistent with my point about professionalism and the importance of leadership. 

Mr. COURTNEY. So can you talk about the DARPA piece of your 

proposal in terms of where that creates that space? 

Secretary KENDALL. Yeah. I think you are referring to what we 

call the Aerospace Innovation Initiative. Yeah, this will be in our 

budget, and I have been authorized to talk about this a little bit 

even though the budget is not out yet. 

The Aerospace Innovation Initiative is consistent with one of the 

Better Buying Power 3.0 initiatives on prototyping and experimentation. And what it will be is a program that will be initially led 

by DARPA, but it will involve the Navy and the Air Force as well. 

And the intent is to develop prototypes for the next generation of 

air dominance platforms, X-Plane programs, if you will. To be competitive, the Navy and the Air Force will each have a variant that 

is focused on their mission requirements. There will be a technology period leading up to the development of the prototypes, and 

it will be consistent with what we talked about earlier. We will do 

the upfront work to make sure you are doing the right thing but 

then reduce the lead time to having the next-generation capabilities. So this is the—this will lead to the systems that will ultimately come after the F–35, essentially. 

Part of the program is an airframe oriented program with those 

X-Plane prototypes. Part of what we put under the Aerospace Innovation Initiative is a jet engine development program for the next 

generation, also competitive prototypes for the next-generation propulsion. 

Now those are going to be two core parts of getting to the next 

generation of air dominance. There are other elements of the Department’s program that are laid out that get to other aspects, but 

that is what the Aerospace Innovation Initiative is. 

Thank you for asking about it. I think it is an important initiative. It falls under a broader Defense Innovation Initiative that 
14 

Secretary Hagel announced last fall, which covers our business 

processes, operational concepts, the way we train people, and a 

number of other things, but it is consistent with that approach. 

Mr. COURTNEY. Thank you. Again, one sort of fun fact in that 

documentary was that it took 5 years from the moment we had an 

atomic-powered light bulb to the launching of the Nautilus as a nuclear-powered submarine, which is just—you know, it is hard to 

even imagine. The Navy was telling him it was going to take 50 

to 60 years to develop a nuclear-powered submarine, and he did it 

in really less than 5 years. It is—— 

Secretary KENDALL. If I can respond to that. I have been asked 

by—not too long ago—by a reporter if I thought the Department 

was taking too much risk. I think we are not taking enough risk. 

And one of the things that Rickover did in that program was he 

did it in a managed, you know, professional way. 

But we can’t expect our programs to execute perfectly. If we are 

going to be the number one country in the world militarily, we 

have to do things no one has ever done before, and that inherently 

involves risk. We can’t—if we take the time to reduce every risk 

to zero, we will never get there. We have got to be willing to accept 

risk in our programs and then deal with the fact that, because of 

that, some of our development programs are going to have overruns 

and schedule slips. It is a part of the process. It is part of the development process. So expecting perfection is really the wrong way 

for us to be thinking about development. 

The CHAIRMAN. I appreciate that exchange. Risk and leadership, 

two keys to this whole thing. That was very, very interesting. 

Mr. Nugent. 

Mr. NUGENT. Thank you, Mr. Chairman. 

And I want to thank our two panelists today. It is always great 

to hear from you. I think you usually do it in a way that we can 

understand, which is a good thing. 

This is really a two-part question, and it is for both Mr. Kendall 

and General Ramsay. What are the lessons learned from the Department’s rapid acquisition program and what extent can those 

lessons be applied to accelerate other DOD acquisitions? 

And the second part of that question is, from a warfighter’s perspective, are they connected well enough to allow to get the needs 

that they have to get actually an acquisition? And then when it 

gets to acquisition, a lot of times, you know, we are trying to get 

to a hundred percent perfect, I think you touched on it, when 80 

percent or 90 percent at least to get it out to the warfighter’s hands 

would be appropriate. And as one of the things that we have seen 

with DOD acquisition is they do a really good job when you start 

building incrementally onto a program, and when you try to get to 

100 percent, that just stalls programs, I think. 

And so it is really a two-part question. I would love to hear your 

answer. 

Secretary KENDALL. I think, like a lot of other things, the secret 

is to have the right balance. The rapid acquisition programs, I 

think, have been very successful. I look at MRAP’s [mine-resistant 

ambush protected vehicles], for example, as a classic example 

there. And what we have done there is focus on the essentials of 

what we are trying to provide to the warfighter and go for that and 
15 

get that done as quickly as possible. So we have accepted risk in 

those programs. And we haven’t done perfect programs, but we 

have done programs that worked and saved lives and were very effective on the battlefield. 

I chair a group now called the Warfighter Senior Integration 

Group, which is in very close touch with our people doing operations, our response to what we call urgent operational needs. And 

we use rapid acquisition approaches to address those needs. So 

where they are applicable, they work very well. 

I am going to—just to be—on the other hand, okay, there are 

programs where that isn’t the right way to go about it. 

Mr. NUGENT. Sure. 

Secretary KENDALL. And I can think of some programs where we 

have done rapid acquisition type demonstrators, prototypes, and 

then try to take them to production and field them, without having 

done the things we need to do to make sure those are reliable and 

will really work in the environment over a period of time. So that 

is a little different than when you are trying to fight a warfighter 

and do something right now in one specific environment. So, again, 

the secret is balance, but the programs you cite I think have been 

very effective. 

And one of the things we are trying to do is preserve that capability. As our operations in Iraq and Afghanistan have drawn 

down, we have tried to find ways to institutionalize that rapid acquisition approach. 

I published just recently our DOD 5000.02 instruction, which is 

our guidebook for all defense acquisition, basically. It is kind of the 

Bible for defense acquisition. And we included a rapid acquisition 

model in there, and a couple of approaches where urgency is really 

what drives you, and there you cut corners, you take risks, you do 

things you wouldn’t do otherwise, you cut away the nonessential 

requirements, focus on the essential ones to try to get the capability out as quickly as possible. So I appreciate your comment. 

That has been an effective program. And when it is appropriate, we 

want to continue to do it. 

General RAMSAY. Congressman, I will just piggyback on Mr. Kendall’s comments by saying from my 21⁄2 years’ experience, the authority and the guidance that this committee gave us back in 

NDAA [National Defense Authorization Act] 2011 has been absolutely wonderful to support the warfighter. 

I would offer kind of two vignettes to answer both of your questions. We are really good at adapting programs we have, and we 

are really good about delivering those things that truly are deliverable in a very short amount of time. So MRAP, Mr. Kendall used 

that example. 

Let me give you an example of both of those. Obviously, one of 

the biggest areas that we have been addressing for the past decade 

is the area of permissive ISR [intelligence, surveillance, and reconnaissance], so the MQ–1, MQ–9 platform, the Reaper being the 

MQ–9. One of the things we figured out was they are not an inexpensive aircraft. They are a phenomenal capability. And everybody 

wants them; the warfighters want them. 

So sometimes the solution is not more of the same; sometimes it 

is modify what you have. So one of the things we have done 
16 

through the rapid acquisition process is adding extended-range kits 

to the MQ–9s we have. We continue to buy more of those. So eventually the fleet will be MQ–9, more capable platform, made even 

more capable through the joint—this rapid acquisition process. 

The second thing I will offer is when you take something that is 

developable in a short amount of time for the warfighter, we can 

do that very fast. So a great example just in the last few months 

has been with the Ebola crisis in West Africa, one of the things we 

were asked to do by the government was to come up with a way 

to transport our own people to isolate them the way you see a commercial company out of Atlanta. They do that now. We went from, 

‘‘I need something,’’ to funding it, finishing the requirements, developing it, and fielding it in about 3 months. And that is the transportable isolation system. 

So where it is doable and manageable in a very short amount of 

time, we can deliver that very fast through the process. And, as 

Mr. Kendall says, we can cut through a lot of red tape. 

Mr. NUGENT. Well, I thank both of you for your answers. 

And I yield back. 

The CHAIRMAN. Mr. Peters. 

Mr. PETERS. Thank you, Mr. Chairman, and thank you for having this hearing. It comes at an important time. 

As you have outlined, these threats are expanding. They are 

new, and they are essentially technological. And yet one of the biggest problems we have here in procurement is harnessing the powers of our own technology to get that into the—to get the innovation that is happening here in the United States into the military. 

And so this is not just an issue of management or budget, but it 

is an issue of security. And it is my observation that we really just 

can’t have this friction among these moving parts anymore. 

I would offer some comments I have heard from industry, on 

which we rely to build and many cases develop these products, that 

they don’t have a good relationship in terms of interaction and that 

they weren’t involved necessarily in the Better Buying Power programs development as much as they would want. I just encourage 

you to be talking to those folks about what it is that we are missing—we are missing, you are missing—and how that program can 

be improved. 

Obviously, there are issues of culture at any bureaucracy. In the 

DOD, I think you have identified some of those. And with respect 

to Congress, I do agree with the recommendation that we repeal sequester, and if there is a vote on that, you would have my support 

and my vote. 

I wanted to ask a specific question in the context of IT [information technology], where there is a major transformation with the 

ever-growing cloud, mobile, social computing requirements and the 

acquisition of network equipment that has to fundamentally 

change if we are going to keep pace. And you—in August 2014, to 

your credit, your office released a set of competition guidelines; 

called out restrictive specifications as an impediment to competition; acquisition workforce complacency; lack of accountability; and 

the use of sole-source justifications; and cautionary language about 

vendor lock; offered general techniques and approaches to support 
17 

competition; and a discussion on the benefits of employing an open 

systems architecture, all to your credit. 

I wanted to ask you two questions. One is, how would you characterize your implementation of those guidelines to date, specifically with respect to IT acquisition. And then what are some specific timelines and actions for implementing these good recommendations that you would like to propose to promote competition? 

Secretary KENDALL. There are two different forms of IT, I think, 

that we have to talk about. One is IT infrastructure, which is basically all of the hardware and software that provides the networks 

that our applications run on. The other is the business systems 

that run on those networks, the applications, if you will. 

Working closely with the CIO [chief information officer] on the 

infrastructure, which is largely his responsibility, and we have 

some good modernization programs, I think, in effect there, which 

would be much more efficient. 

On the business systems side, we are trying to get a more flexible model. For a long time, the Department was applying a model 

which was somewhat rigid in terms of how we wanted to see programs structured. And we are trying to learn from commercial industry more about how to do that. 

Now, I can tell you from my own commercial experience that implementing new business systems is very, very difficult, even in the 

commercial side of the house. Trying to do business systems at a 

major defense contractor I found to be a very, very challenging 

task, and there are a lot of histories of people having problems 

with that. The Department has its own sordid history, I think, in 

business systems. And I think we have improved there. I think we 

have a long way to go. 

One of the things that I am trying to do is build up our body of 

professionalism in that area. It is a very specialized acquisition 

field. It is not the same as a weapons system. The transition from 

an old business system to a new business system is much more difficult than the transition from an old piece of hardware to a new 

piece of hardware. 

The way you manage industry in that, the way you set up incentives, the way you ensure you have open systems, so that you have 

flexibility and aren’t in a vendor lock situation, they are all important in how we structure that. 

So I think we are making progress. It is hard to put out specific 

goals, because we tend to work on a program-by-program basis. I 

am trying to establish a center of excellence for business systems, 

which I think will be helpful to the Department, essentially an internal consulting organization of people who have had experience 

implementing business systems. And one of the hardest things is 

transitioning them into a field and replacing the things that are already there, getting the workforce trained and so on. 

Mr. PETERS. When we—— 

Secretary KENDALL. Another thing is—— 

Mr. PETERS. When—— 

Secretary KENDALL [continuing]. Our requirements. 

Mr. PETERS. I was just going to say about timelines—I am running out of time here myself—so I want to see if you can give me 
18 

some sense of how quickly you saw some progress in this transition. 

Secretary KENDALL. We are doing—well, one that I think we 

have really turned the corner on and are doing much better on, although I don’t want to jinx it, is electronic healthcare records, 

which we have moved to a more commercial model on. We are in 

source selection for that now. I have got a top management team 

working that. I think we are going to do a pretty good job with this 

one, make it a good model for how to do this. 

Others, I think we have learned from our mistakes. Some of our 

ERP, our enterprise resource programs, I think, are coming along 

and doing better. We had a financial management system in the 

Army which struggled a little bit to be put in the field last year 

that is doing all right now. 

So I think what I would have to do is look at the specific things 

we are doing and where you would see evidence through those of 

progress. 

Mr. PETERS. My time has expired, but maybe if you can get back 

to me specifically—— 

Secretary KENDALL. Sure. 

Mr. PETERS [continuing]. On IT acquisition in writing, that 

would be helpful. 

Secretary KENDALL. Happy to do that. 

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

page 69.] 

The CHAIRMAN. As you all know, they have just called votes—excuse me, two votes. My intention is to go, say, another 10 minutes 

or so and then recess to go vote. 

And then I am going to come back and continue the hearing, 

with the indulgence of our witnesses. You all can have a cup of coffee or something, if you don’t mind, and then we will be back after 

that. 

Mr. Bridenstine. 

Mr. BRIDENSTINE. Thank you, Mr. Chairman. 

And, Mr. Kendall, thank you for being here. 

And General Ramsay, thank you. 

My question was for you, Mr. Kendall. You mentioned three 

high-value assets specifically. You talked about Air Force bases. 

You talked about aircraft carriers. And you talked about space. 

And that these high-value assets represent a relatively limited 

number of targets that enable the enemies of our country ultimately to have an advantage when we are on the other side of the 

world, and certainly that is a concern of mine as well. 

What I would like to talk to you specifically about is space. When 

you think about architectures in space, we currently have in space 

from the commercial sector literally hundreds of satellites for communications. And if we were to leverage those satellites, we would 

in essence very quickly disaggregate the targeting solutions for our 

enemies and at the same time create more resiliency and redundancy in space. 

Additionally, when you look at current acquisitions of, say, WGS 

[Wideband Global SATCOM] satellites and the capabilities of these 

satellites, we are talking about the ability to transmit 7 gigabits 

per second compared to what the private sector is putting into 
19 

space right now, which is, you know, 140 gigabits per second, and 

that is this year. Next year we are going to be multiple hundreds 

of gigabits per second that the private sector is developing and 

launching, and at the same time, we are going to continue launching into the future, owned and operated by the military, satellites 

that only can produce 7 gigabits per second. 

My question for you is when you look at disaggregation and resiliency, when you look at the capabilities of the private sector and 

you compare that to maybe even, you know, as DARPA was involved in generating or producing the Internet, it wasn’t until the 

private sector ultimately got a hold of it and started taking advantage of it for commercial purposes that we actually leveraged it inside the military to where we could actually have an advantage. 

And if you look at satellite communication architecture, the systems exist in space now, and it seems to me that we are not taking 

advantage of it, and if we don’t, our enemies possibly could. 

This, I think, represents a challenge that we have to face as it 

relates to the acquisition of access to a global communication architecture that already exists in space. 

My question for you is as we go forward, will we get proposals 

from the Department of Defense to take advantage and leverage 

these assets that already exist and, of course, the rapid advancements in technology that are happening right now? 

Secretary KENDALL. You make some very good points, and I 

think the short answer is yes. Because of concerns about the survivability of our space assets, we are looking at a wide range of alternatives to the way we currently do business. We have a system 

called EHF [Extremely High Frequency], it sounds like you are familiar with these, which is a very secure communication satellite. 

And we have to have satellite systems that provide communications that are secure against jamming, secure against cyber attack, 

and provide encrypted communications for us, and some of those do 

things like support the strategic deterrent. We also need to have 

fairly high bandwidth in order to support current operations in certain places, and we have leveraged commercial satellites to some 

degree, but we are relooking now at our architectures because of 

the survivability problem that I talked about and you mentioned to 

see if disaggregated architectures of one type or another. 

And I think one of the things we do have to look at is whether 

we can effectively disaggregate by reliance on commercial systems. 

And we have to be sure that they are going to be available to us 

in wartime, that we will have the capacity that we need. So there 

are some questions that we have to answer there. And we have to 

look at their resiliency to various threats, not just to direct attack. 

But the short answer to your question is yes. 

And General Ramsay may want to comment on this, because it 

is largely a requirements question. 

General RAMSAY. I will just piggyback on one word that Mr. Kendall mentioned, and it is a great issue to discuss further, and it is 

disaggregation. This has been a big topic in my 21⁄2 years in this 

job has been how do we—how do we look at space as a domain, and 

disaggregation could be doing things that we currently do in space 

by not doing it in space anymore. 
20 

So we are looking at the whole soup to nuts. And as Mr. Kendall 

touched on, the big issue is there are certain things we have to do 

that are very protected, very secure that may not have the bandwidth commercial satellites do, but we really are very much wedded to the commercial backbone, and I just see that increasing over 

time, but it is finding that right balance in the future. 

Mr. BRIDENSTINE. I have about 20 seconds left. Just something 

to think about. Currently when I talk to folks in the Pentagon, they 

talk about buying megahertz, they are talking about buying spectrum. And with spot beams and all the technologies that are advancing today, we need to start talking about—for the taxpayer as 

well as for the warfighter, we need to start talking about, how do 

we purchase capacity, high throughput capacity, and putting it in 

terms of dollars per gigabits per second, if that makes sense. 

The CHAIRMAN. I thank the gentleman. 

Mr. Walz. 

Mr. WALZ. Thank you, Chairman. 

And thank you for holding this hearing. 

Mr. Kendall and General Ramsay, thank you for your testimony 

both today and this week, very enlightening. 

I would just like to—two questions: One, are we making some 

improvements now, and I want to give the case study from an end 

user perspective on the Crusader project as that came forward, and 

it felt like to me that there was very little input from the end user 

side of things. The Crusader was 1995; the Howitzer piece that was 

approved, you got the prototype in 1998. We went down, and we 

were starting to manufacture, and it was cut off in 2002 by the 

Secretary. 

Can that type of thing still happen today? I mean, does that happen in terms of the acquisition, because from a—both in preparation from the fielding of that and the training from the end user, 

artilleryman, that was out there with that expectation and all the 

changes that went into play when that was cancelled that far down 

the line—does that still happen? 

Secretary KENDALL. It hasn’t happened recently. I am very familiar with the Crusader history. It is one of a number of programs 

that was started, and we spent quite a bit of money on it and then 

cancelled it. Part of the legacy of the Crusader was that it was a 

Cold War-oriented system at the time it was started, and the idea 

was to have a very efficient artillery piece that could be used in 

Europe more than anywhere else against the Soviets at the time. 

As the Cold War ended, the Army stuck with the program for a 

while. There were some technical issues. There were some cost 

issues. It was really a stretch. It was really a high-risk system, if 

you will. And it got into problems in development. Then it got into 

problems in affordability. And the Army came to a point, after operations in Kosovo, where the importance of deploying rapidly to a 

contingency really became a dominant consideration in their requirements. And I think that had a lot to do—— 

Mr. WALZ. So the inability to move it—— 

Secretary KENDALL [continuing]. With the Crusader being cancelled as well. So I think if—things change. And sometimes the 

threat changes so much—or the situations, as you set the pace, 
21 

change so much—that you really do need to revisit prior decisions, 

and in some cases, it is appropriate to stop a program like that. 

Mr. WALZ. I think—— 

Secretary KENDALL [continuing]. But I think we need to be very 

careful—— 

Mr. WALZ. It takes courage, though, to do that, right? 

Secretary KENDALL. It does take courage to do that. 

Mr. WALZ. So they would—because I think it would—history 

shows out, it was probably the right thing. 

And my question is, and just quickly as you see this, at what 

point does the end user come into that? And I say that because I 

think you are absolutely right. That was a transition from Cold 

War to a new one. We have a wealth of knowledge amongst warfighters that have been on the ground. Are we using that—in terms 

of—is that fielding into the decisionmaking? 

Secretary KENDALL. I think it is, but I think you have to be careful, because there is a tendency to think of the current fight or the 

most recent fight as the one you are always going to have to worry 

about, and I think at the current time it is probably the opposite 

of that in some ways. The counterinsurgencies we have been fighting are probably not the model we should be most concerned about 

going forward. It is very hard for people to anticipate the next war. 

We are almost always wrong about that. 

Mr. WALZ. Yeah. 

Secretary KENDALL. And it is important for a country like the 

United States to have general purpose forces that can do a lot of 

different things. And I mentioned earlier that right now, particularly with resources as tight as they are, that we really need to be 

very careful about our new starts and not start programs that 

aren’t going to be the right program for us for some time to come. 

Mr. WALZ. Very good. 

I yield back. 

Thank you both. 

The CHAIRMAN. Thank you. 

Ms. Walorski, there is, I think, 350 people who haven’t voted yet. 

So if you would like to go ahead, I think we have got time. 

Mrs. WALORSKI. I think we have time. 

Thank you, Mr. Chairman. 

Thank you, gentleman, for being here. 

My question is twofold. One is—I co-chair the working group 

here on electronic warfare. And knowing the comments that you 

made on Wednesday and the comments [Admiral] Greenert has 

made before on the next large domain of our vulnerabilities, so my 

one question is: What can Congress do to help DOD streamline and 

bring attention and effectively address that electronic warfare problem? 

My second question quickly is: What about the issue of trust as 

we look at acquisition? You know, I represent the State of Indiana. 

I have a variety of different types of assets there. 

And the question I always get relative to this issue of acquisition 

reform is nobody trusts the Pentagon and the lack of trust—no relationships, lack of trust, nobody believes anything on the side of 

the private industry or newer people trying to get in. 

Could you just address those two issues? 
22 

Secretary KENDALL. It is probably easier to address electronic 

warfare. 

We do have some shortfalls in electronic warfare. And the Defense Science Board did a study on this area recently and made a 

number of recommendations. And some of those we were able to 

take into account as we prepared our budget. Others we need to 

do additional study on. So that is an area that is getting a lot of 

attention right now. 

When I talked about what Russia and China are doing in particular, electronic warfare is a fundamental concern and it is an 

area that, because of the types of threats we have been dealing 

with, we have not focused on nearly as much as we probably should 

have. 

As to trust, the military is still one of the most trusted institutions in the country. I am a little surprised to hear you say that. 

Industry—and I have to tell my government counterparts this often 

because I have worked in industry quite a bit—is we need to appreciate that industry doesn’t necessarily trust us in how we do business and we need to be very transparent and clear in why we are 

doing things and how we are doing them. 

And I don’t want to go into any examples, but I think we have 

to remind ourselves that trust can’t be assumed. It has to be 

earned. And you do that by your behaviors, by being as transparent 

as you can about what you are doing and why you are doing it. 

Unfortunately, all of our source selection processes, which is 

where this often comes up as an issue, have to be protected because 

of the proprietary information involved and so on. So people get 

limited visibility into why someone was selected over someone else. 

I tell the story often that I don’t think there has ever been a proposal manager who came back after he lost and told his boss that 

he lost because he wrote a bad proposal. They always come back 

and they say, ‘‘I lost because they like this other guy’’ or because 

of some—you know, something that is not, you know, self-deprecatory. 

Mrs. WALORSKI. Well, let me ask you this—— 

Secretary KENDALL. So I think you have to be careful about that, 

too. 

Mrs. WALORSKI. Yeah. I understand. 

But do you at least agree that there has to be—if we are really 

going to talk about how are we going to do this with this budget 

environment, with the vulnerabilities environment, like that, I 

mean, do you at least agree that that issue with relationships and 

trust—something has to happen there, I think, in order for—or I 

wouldn’t be hearing it—and I am one of the younger members of 

the team here—so that at least has to be addressed and there has 

to be some kind of effort put forward where there is some kind of 

an atmosphere of trust? 

Secretary KENDALL. Yeah. I agree. 

And we worked on our relationship with industry very hard. I 

was going to respond to the earlier question on that. 

We have reached out to industry. We take inputs from industry 

associations and from individual firms. I am very accessible to industry. My staff is very accessible. My manufacturing and industrial base lead is very open to industry. 
23 

And we have solicited inputs from industry for all of the different 

versions of Better Buying Power. And we have taken them into account, and they have affected what we have done. 

We have listened to industry on issues like lowest price technically acceptable—there are concerns with that—commercial end 

items. So we are trying to respond to industry’s concerns. 

At the end of the day, as somebody mentioned, there has to be 

an effective partnership with industry. We sit down. We try to negotiate the best business deals we can and protect the taxpayers’ 

interest, but we also have to live in an environment where industry 

is motivated to come do work for us, where there is a reason for 

them to want to come work for the Department besides just patriotism. 

And we need to be able to attract non-traditional firms to work 

with us, firms that, you know, there are—for which there are some 

barriers to entry, if you will, into the marketplace for defense. So 

it gets a lot of attention, and we have to, again, strike the right 

balance. 

Mrs. WALORSKI. I appreciate it. 

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

The CHAIRMAN. Thank you. 

It just seems to me that, in addition to transparency, simplicity 

of the process with accountability for decisions go hand in hand 

with that and can help build added trust, and I know that is part 

of our mutual goal here. 

I think we are going to take a break. And, again, we have two 

votes. Again, appreciate very much you all’s indulgence while we 

go do that. And we will recess for the time being to reconvene after 

votes. 

[Recess.] 

The CHAIRMAN. The committee will come to order. 

Again, thank you all for your patience as we finish those votes. 

Ms. McSally, would you like to take time? 

Ms. MCSALLY. Absolutely. 

The CHAIRMAN. The gentlelady is recognized for 5 minutes. 

Ms. MCSALLY. Great. Thank you, Mr. Kendall. 

And thanks, General Ramsay. It is good to see you again. 

We were just reminiscing about, when I first met General 

Ramsay, I was a captain and he was a major. 

So it is great to see you continuing to serve in such a high capacity, and it is wonderful to be working with you. 

So I have got two questions. One is related to the development 

of follow-on aircraft. You know, as you may know, I flew the A–10 

Warthog and there has been a lot of discussion about the future of 

the A–10. 

But under the assumption that the A–10 sticks around for a little while longer and if we could agree—maybe you won’t agree with 

me—that the Joint Strike Fighter does not provide capabilities and 

we decided we wanted to develop an A–X at some point, like today. 

We decided we are going to develop an A–X today, it needs to be 

a light attack aircraft to be able to do the things to protect our men 

and women in harm’s way, what are we talking about timelinewise? 
24 

I mean, just to—I want to just be able to frame the discussion, 

and I know it is hard because you don’t know what the requirements are. But are we talking like 15 years, you know, to develop 

something where we haven’t even identified it? And what could we 

do to speed that process up? 

And then the second question is related to—you mentioned the 

constraints of sequestration. But, also, when we are spending 

money based on the end of the fiscal year, use it or lose it, even 

though we have had deep cuts—and I have seen them, and I have 

seen them in the military—that is also a very inefficient way to do 

business. And even last year—I know friends still in uniform, and 

I know friends who are contractors now—they were still on a 

spending spree of sorts in the last week in September, you know, 

with the money. 

So what can we do to address that? Because, I mean, we are 

under very difficult financial, you know, resource limitations right 

now, but we are still on a spending spree at the end of the fiscal 

year. So what can we do to help fix that culture and that dynamic? 

Secretary KENDALL. I am going to let General Ramsay address 

the next light attack aircraft that we are going to buy, which I 

don’t think we have one of those in the budget at the moment. 

But the issue of use it or lose it is a real issue, and I—and it 

was what I was getting at earlier about not putting our people in 

a position where time is working against them and they have to 

spend money or they feel pressure to spend money. 

We have looked at that. And it tends to happen on the O&M [operations and maintenance] side of the house where money expires 

every year, and it also tends to happen where people are buying 

things like office products and so on where people will stock up at 

the end of the year. 

And I don’t know—I don’t have good data on the magnitude of 

that abuse—or I consider it abuse if we are buying things we don’t 

need just to spend money. 

Ms. MCSALLY. Yeah. Those are full-service contractor things—— 

Secretary KENDALL. And I tell the story about, when I was a 

lieutenant in the Army, we would fire ammo off at the end of the 

year so that we would get the same amount of ammo next year. 

I have had fighter pilots talk to me about going out and burning 

holes in the sky just to use up gas because they wouldn’t get, you 

know, the O&M money for training next year, even though it 

wasn’t a useful use of the resource. And I think that is a problem. 

And the Defense Business Board talked about how the Defense 

Department tends to be a culture of spending as opposed to a culture of cost control. That is one of the fundamental things we have 

been trying to get after in the whole set of Better Buying Power 

initiatives. 

We try to force our managers to address cost control as a fundamental mission and to track their costs, understand their costs, 

and try to beat them down and to free up resources for things we 

really need. So if we do have end-of-year money and we can repurpose it, it needs to go to things we really need and not just be spent 

because it is there to be spent. 

And I will let you address the next-generation. 
25 

General RAMSAY. Congresswoman McSally, boy, that sounds good 

when you go back to a press conference we talked about in 1993. 

But it is great to see you again. And congratulations. 

Obviously, the A–10 subject has been discussed a lot with Congress, but also in the building. And I am not going to repeat all 

the things that my Air Force has said, but I will just say—— 

Ms. MCSALLY. Yeah. I just don’t even want to get into that. 

General RAMSAY. Yeah. 

Ms. MCSALLY. It is just more if we are going—— 

General RAMSAY. If we are going to do it. 

Ms. MCSALLY [continuing]. To develop something else, what does 

it look like? 

General RAMSAY. Let me kind of tie it into the Aerospace Innovation issue that Mr. Kendall hit on earlier. 

We are looking at this—you know, one of the things that JCIDS 

does is—we are not looking at specific mission areas. We are looking at domains and how to—how are we going to fight the future 

fight. So part of the A–10 issue, besides the fact that it is an aging 

aircraft, is what is right for the high-end fight of the future. 

So as you well know, we are looking at this from a multitude of 

angles: the permissive environment, the huge dearth of weapon 

systems that this committee has supported us buying over the last 

10 years that allow us to do some pretty remarkable things, and 

maintaining the technological edge to do that. 

The short answer to your questions is, if we started today—and 

I will really defer to Mr. Kendall on a timeline—we are probably 

talking about 15 years for a full developmental program. There are 

some low-end things out there that other nations are buying we 

could do much faster, but we don’t think that is the right thing for 

us for the high-end fight of the future. 

Ms. MCSALLY. Yeah. Thanks. That is really what I was getting 

at. I didn’t want to get into the politics of it all. 

But start to finish, if we decided—and thanks so much for—15 

years is a good—that is what I figured it would be, but I wanted 

to make sure that that was my understanding. 

So part of the dialogue we have for the future capabilities—— 

Secretary KENDALL. If we built a low-end light attack, we could 

do that very quickly. There are off-the-shelf possibilities—— 

Ms. MCSALLY. Okay. 

Secretary KENDALL [continuing]. For that. I mean, Textron has 

done a system on their own money which could possibly fulfill that 

need. We have done a propeller-driven light attack we have given 

to the Afghanistans. And there are planes around the world we 

could look at modifying and using. 

If that were the only purpose for the aircraft, we could do it pretty quickly, I think. The problem is, if we want something that is 

going to give us air dominance for, you know, another generation—— 

Ms. MCSALLY. Right. 

Secretary KENDALL [continuing]. That is a very, very different 

program. That is a 10-year program. 

Ms. MCSALLY. Right. Thanks. 

And my time is expired. Thank you. 

The CHAIRMAN. Thank you. 
26 

Mr. Scott. 

Mr. SCOTT. Thank you, Mr. Chairman. 

And I share the concerns about the loss of the A–10, especially 

as far out from the basing of the F–35s. That is, I think, my primary concern. I understand it is an aging system. I would sure feel 

better about standing the A–10 down if we were closer to the basing of the F–35. 

And as we talk about acquisition reform, one of the things that 

we haven’t talked about yet is life-cycle costs and sustainment, and 

that ends up being about two-thirds of the cost of the system. And 

it kind of gets overlooked, if you will, in the press and other areas. 

But, I represent Robins Air Force Base, one of the three depots, 

and I would just like you, if you would, to speak to additional reforms in the acquisition process from the standpoint of sustainment 

planning, total life-cycle cost, and how our organic capabilities play 

into those areas as well as the ability to ramp up, if you will, when 

we need to. 

Secretary KENDALL. I think we have probably got about the right 

balance of depot and contractor support, and it is something that 

I think has been stable for many, many years now. We are trying 

to improve the efficiency of both the depots and of contractor support. 

One of the Better Buying Power sets of initiatives that you have 

in front of you is an area of contracting services, including maintenance. And we are also trying to invoke performance-based logistics 

as a way to incentivize industry or depots, for that matter, to do 

a better job. 

It is a little harder in the government structure than it is with 

industry to do that sort of thing. But both have their role, and one 

of the important roles of the depots is their surge capability in case 

it is needed. 

And increasingly, as we have an aging force, the depots are needed for overhaul and upgrades of our system. So I think, again, we 

have got the balance about right. 

We are focused on sustainment. As you mentioned, it is something on the order of—50 to 70 percent of our life-cycle costs of our 

program are in the sustainment phase as opposed to the R&D [research and development] or the production phases, and we really 

have to go after that much more carefully than we have. 

The development phase overruns tend to get all the public attention, but that is not where the money is. We really need to look 

where the money is and try to drive costs out there. 

Mr. SCOTT. General. 

General RAMSAY. Congressman, if I could just add very quickly, 

one of the things that this—that Congress has directed us to do, 

based on our request, is very, very, very early in the requirements 

process, as we begin to have a conversation about a gap with our 

acquisition professionals and look for resources, we do an analysis 

of alternatives that really gets at the life-cycle cost. 

So we are trying to find out the knee in the curve and what the 

life-cycle cost is going to be from the moment we start bending 

metal until something goes to the boneyard, if you will, and look 

at that, you know, from head to toe. 
27 

Mr. SCOTT. Do you foresee Air Force depots competing for business from other branches in the future? Do you foresee us, if you 

will, allowing that work to transfer from Army to Air Force or 

move—— 

Secretary KENDALL. I would like to have the flexibility to do that 

sort of thing. And I am speaking totally off the cuff right now. But 

I would like to have, frankly, more public-private competition than 

we are allowed to have right now. 

Competition is terrific. It drives out costs more effectively than 

anything else. And I think having competition among the services, 

even for service organizations, to do work like that would probably 

be healthy for us. I am not sure that everybody would be happy 

about that, but I think it would be healthy in terms of driving our 

costs. 

Mr. SCOTT. Thank you. 

I yield the remainder of my time, Mr. Chairman. 

The CHAIRMAN. Thank the gentleman. 

Ms. Stefanik. 

Ms. STEFANIK. Thank you so much, Mr. Chairman. 

Thank you, Mr. Kendall and General Ramsay, for your testimony 

today. 

My question relates to clarifying the chain of command in the acquisition decisionmaking process. 

What steps are you currently taking to clarify both authorities 

and improve the accountability of the decisionmakers within and 

throughout the chain of command? 

Secretary KENDALL. The chain of command for acquisitions is 

pretty straightforward. For major programs, it runs from me, 

through the service acquisition executive, to the program executive 

officer, to the program manager. And I try to emphasize that it is 

one of the principles that we have pushed in all the Better Buying 

partnerships. 

We try to set up our—this is relatively new, but we try to set 

up our program managers’ tenure so that they come into a program 

before you start a phase and then their responsibility, once they 

have gotten approval to do the—their plan for that phase, is to execute that plan. So success is about successful execution of a plan 

that you submitted as opposed to getting something approved. 

I try to hold our program managers and program executive officers accountable by recording their names on all of my decision 

documents as the people who brought the plan forward for approval that I am approving so that there is a permanent record of 

that. 

We occasionally have to remove someone who is not performing 

effectively, and we have done that. We don’t usually do it with a 

lot of fanfare. These are often people who have had fairly successful 

careers working in the military. And we are not trying to embarrass them, but we are trying to replace them with somebody who 

is going to be more effective in that particular role. 

So I think we do do some things. I think what we have to work 

against, to some extent, is all of the stakeholders in our acquisitions programs who have a voice and often are senior in rank to 

the people involved in the actual management of the programs, and 

that can sometimes be a problem for us. 
28 

Ms. STEFANIK. Thank you. 

I yield back. 

The CHAIRMAN. Mr. Langevin. 

Mr. LANGEVIN. Thank you, Mr. Chairman. 

And thank you to our witnesses for your testimony here today. 

Mr. Chairman, you and I have had a long history of working together on these important issues. I really appreciate this hearing 

and your continued attention to such an important national security matter. 

General Ramsay, if I could start with you, I would like to learn 

a little more about the interplay that drives the JCIDS process. 

And as you and your staff work through future battlespace scenarios and determine what is needed, how do you determine what 

technologies will be mature enough for inclusion in those discussions? 

And could you elaborate as to how you draw in the subject matter experts to staff the Functional Capabilities Board. 

And how do you ensure that they are able to have full visibility 

across the research and development enterprise with an appropriate appreciation for technological maturity levels? 

And, similarly, how do your discussions feed into the concept of 

operations discussions that are in many ways just as critical? 

I know I am throwing a lot at you there, but if you could help 

me by answering those questions. 

General RAMSAY. Well, thank you, Congressman. 

And I got to spend a year in Rhode Island and loved every 

minute of it in Naval War College. So I will open my comments 

sort of as a naval term, as an Air Force officer—— 

Mr. LANGEVIN. Please come back and visit us again soon. 

General RAMSAY. I will. And I know you are digging out from a 

big snowstorm from the last 2 days. 

It is an all-hands-on-deck, I guess is the best way I can talk 

about the process in a couple of the areas that you mention. 

The JCIDS process that we have statutorily and then, by our 

own volition, evolved to over the last 6 years, I mentioned earlier 

that we now have certified requirements professionals that work 

within it. If you want to be in the requirements business in the Department, you have to be certified by Defense Acquisition University just like our great Acquisition Professional Corps. 

The second piece of this is it is a completely transparent, collaborative, intertwined process. So when you look at the three big pillars of how we do the Department’s business—resourcing, requirements, and acquisition—those bubbles all interact and everybody 

plays in the pool. 

So I am a key figure, for example, in all three areas. So is the 

Vice Chairman. So is Mr. Kendall, who runs the Defense Acquisition Board. And the Vice Chairman runs the Joint Requirements 

Oversight Council; he is the chair of that. 

As I said early on, we work with the acquisition community, with 

the intel community. Intel has the most play in developing the concept of operations, what is the future fight going to look like. 

Then we work with the warfighters, especially the combatant 

commanders, about how they would like us to look at addressing 

that. That leads us into the technological piece that you mention. 
29 

And that is where acquisition professionals come in. That is 

where DARPA comes in. That is where things that Mr. Kendall is 

working to reach out to industry to find out, simply stated, what— 

what is the state of technological maturity across the board in the 

world today to bring that into defense. Some things we know about 

and some things we don’t. 

So if I could use one word to kind of capture all this, it is ‘‘intertwined.’’ We are all linked at the hip from the very beginning of 

‘‘I have a problem’’ to ‘‘I need a solution,’’ and we work this together as teams across resources, requirements, and acquisition. 

Mr. LANGEVIN. So let me ask you this: How do concerns about 

industrial base and niche capabilities where we are relying heavily 

on industry R&D dollars, such as directed energy, fit into your 

decisionmaking? 

And, also, you briefly mentioned electronic warfare in your testimony, Mr. Kendall. How do we compare in that capability with our 

adversaries? And what would you need to be done to improve upon 

it? 

Secretary KENDALL. I think the simple answer on electronic warfare is we have neglected that area for some time because we 

haven’t been able to respond to some of the things the threats are 

doing. 

I think we are behind right now. We are playing catch-up to 

some degree on that. We have some programs underway, next-generation jammer, for example, in the Navy. I would like to see those 

things accelerated where we can. 

Again, we just had a good Defense Science Board study on this. 

It gives a lot of recommendations. Some of those have influenced 

our budget. Others are under further study and will probably influence next year’s budget. 

So I think that is an area where I think we need to focus a lot 

more attention going forward than we have in the past. 

Mr. LANGEVIN. Do you want to add anything, General? 

General RAMSAY. Yes, sir. 

Just very quickly, one of the things that we—and you mentioned 

this, and that is the reason I want to touch upon it. 

One of the things that we are very cognizant of as we work 

through our concept of operations is just what is out there for us 

to be able to do. And the industrial base is certainly something we 

watch. 

But, really, Mr. Kendall and his team are the experts. And, obviously, as the budget has come down the last 5 years, we are very 

mindful of those industries out there that we cannot lose. 

And I would like kind of Mr. Kendall to piggyback on that, if he 

would. 

Secretary KENDALL. We cut R&D spending from a peak of over 

$80 billion to about $65 billion, $63 billion. That is a pretty dramatic drawdown. 

And I think of that, frankly, as letting the engineers that are 

part of our force structure go—a lot of them go. And when those 

people leave defense industry, they are probably not coming back. 

And we consciously look at this every year as we go through the 

budget process. 
30 

We have—the Deputy Secretary chairs a meeting where he looks 

at the health of industry consciously to make sure we are not doing 

anything there that is going to do irreparable harm. 

And we have, I think, over the last few years in each case made 

some adjustments in our budget because of industrial base concerns. 

That said, at the end of the day, the resources are what they are. 

And if you are going to cut your amount of funding in R&D by a 

large amount of money, then you are going to cut a large amount 

of your capacity to do that kind of work, and you have to rebuild 

that. 

I mentioned the Aerospace Innovation Initiative earlier. One of 

the reasons I am doing that—one of the reasons the Department 

is doing that is to preserve the design teams that can give us the 

next generation of capability in that area. Because once those design teams go away, we have lost them and it is very hard to get 

them back. 

In very specialized areas, like you mentioned electronic warfare, 

that is a very special skill set and you can’t develop somebody who 

is an expert at that overnight. It takes time. And you get that expertise by working on programs, by developing new cutting-edge 

things. 

Mr. LANGEVIN. And I know my time is expired. 

But I share that concern. And I have heard directly from industry that, given the significant drawdown in R&D, that they are 

struggling to survive in many fields and they are making business 

decisions right now that—they are—basically, anyways, may be 

forced to close their doors if the R&D funding isn’t there to continue to keep the pipeline alive. 

So, thank you, Mr. Chairman. I yield back. 

I have some other questions for the record that I would like to 

submit. It would be helpful if you could provide some answers. 

Thank you. 

The CHAIRMAN. No, I appreciate the gentleman raising that 

issue. 

I think some of the most difficult challenges we face are to what 

extent we continue to fund, say, a supply line just to keep the industrial base engaged, even if we don’t necessarily need at that moment what they produce. 

And you mentioned the R&D, losing the engineers. I think it is— 

together, those are some of the most difficult challenges we have 

before us. 

I want to get back, actually, to part of what Mr. Langevin was 

asking about at the beginning and then other members have asked 

about as well, General, on the requirements system. I mean, you 

have described, you know, the way it is supposed to work and all 

the interactions and so forth. 

And, yet, as was pointed out earlier, one of the suggestions we 

have heard from some of our conversations with acquisition people 

is we need to take the time up front to really investigate the technology, understand what we are dealing with. 

That helps procurements go quicker. One hears always that part 

of what happens with programs that don’t perform well is requirements creep, that, you know, it changes over time and so forth. 
31 

So my question is: Especially from the military standpoint, how 

do we have the discipline in the system to invest the extra time up 

front, to not have the requirements creep when, you know, there 

is the demands to get it there now? 

You know, I know there is the JROC. Lots of committees, you 

know, discuss this. But, really, when it boils down to how does 

this—where is the discipline in the system to do what has been 

suggested? 

General RAMSAY. Chairman, those are both great questions, both 

great issues. 

The process that we have laid in place, again, thanks to your 

help in the last 4 years, I think really has put us on the path to 

getting at the discipline up front. More and more of our programs 

are really broken up, torn apart, and built back up long before we 

ever—as I said earlier, getting into the business of bending metal. 

In terms of requirement creep, I would offer there are sort of two 

ways—there is two different paths in that. One of them is there is 

requirements creep that is caused sometimes by the assessment of 

what the future war fights are going to be because it takes a while 

to get these weapon systems through the development process and 

into production and the world changes and we have critical intelligence breaches. 

So, in some cases, we have to evolve the requirement because we 

don’t want to field a weapons system to fill a capability gap where 

the gap—the weapon system is not going to serve the needs of the 

future. 

But there is another side of that which, I would offer, we have 

had a lot of success at, again, thanks to your committee, which is 

we are asking program managers and sponsors, namely, the services and the combatant commands, that, when possible, if they find 

out that a weapon system needs to have its performance parameters reduced because we are way beyond the knee in the curve in 

the cost, in other words, we can deliver something that is a little 

bit less capable, but at much less cost, that still meets the warfighters’ needs, we are getting really good at that. 

So, Admiral Winnefeld and Mr. Kendall sent a memo out about 

2 years ago which encouraged, for the first time, sponsors and programs managers to bring requirements back to the process. 

So we have descoped a lot of programs to get at that to find that 

knee in the curve in terms of life-cycle cost. Delivering things that 

actually the warfighters need today, we can get them there quicker 

and we can do it a lot cheaper. So we are kind of watching both 

sides of that. 

The intelligence piece I mentioned a minute ago is something 

rather new, and it gets back to the pace of technological change of 

some of our adversaries, that we have to take a step back and go, 

‘‘We need to rethink this and probably—we can call it requirements 

creep, but it is really about meeting the needs of the future.’’ So 

we are looking at both sides of the coin, if you will. 

The CHAIRMAN. No. And I appreciate you raised that because 

that is a very fair point. If there are leaks, for example, that disclose key technologies, then we have got to deal with that situation. 

We can’t stick our heads in the sand. 
32 

But I will just say, you know, part of what I think this committee 

needs to do is to help provide some of that discipline, too. When 

the budget requests come before us, we need to ask those questions. And maybe we can reinforce some of the efforts that you are 

talking about over the last 3 or 4 years. 

Mr. Kendall, another issue that people talk about quite a bit is— 

and you mentioned it earlier—prototyping and experimentation. 

And one way it has been described is you get into a Catch-22. 

If you don’t have requirements for something, then there is really 

no place to go with it, even if you have got a great idea. And, yet, 

if you can’t at least move a great idea some distance down the process, you can’t ever do anything with it. It just kind of languishes 

there. 

Some people have even suggested maybe we need to look at a 

prototype experimentation fund—expanded fund that you would 

have and let the services compete for dollars or for ideas that they 

could flesh out. 

I guess, kind of in a general way, are there things that we could 

do together to help ideas or to learn from them to have an increased level of prototyping and experimentation? 

Secretary KENDALL. We do do a degree of that now, and we are 

relatively free on the science and technology part of our activities 

to do that without formal requirements, which is a good way to do 

it. 

We have a program that isn’t all that large now in the budget. 

It used to be larger. It is called Joint Capability Technology Demonstration programs, which has done a number of reasonably small 

programs and historically did larger ones, and we are kind of moving slowly back towards more significant demonstrations there. 

The Aerospace Innovation Initiative that I talked about is a fairly large-scale demonstration program. It is a prototyping program 

without a firm requirement. It is going to explore the possible, basically, and it will allow us to have people who set requirements 

make much better informed decisions as we go down the road and 

understand what the art of the possible really is. 

So we do have some things. We also have foreign comparative 

tests, which allow us to look at foreign systems and see how they 

might fit into our things on somewhat of an experimental basis. 

Be willing to have a dialogue with you about whether there is 

an adequate number of resources in that area or not. It is a hard 

area when budgets are tight to peel out resources from other things 

that are being shortchanged already to do things which aren’t definitely going to lead to a fielded product, but it is an important 

thing for us to do at least to some degree. 

The CHAIRMAN. Okay. 

Secretary KENDALL. If I could, Mr. Chairman, I wanted to mention something because I think it is important to call at least to 

your attention. 

I have left with the committee a report that was done by Institute for Defense Analyses, and it has to do with the subject of tight 

budgets and not tight budgets. It is one of the most, I think, profound pieces of work, important pieces of work, trying to analyze 

cause and effect and correlations in our acquisition system over 

decades. 
33 

And what—this analysis, which was done by the former head of 

the CAIG—Cost Analysis Independent Group—and what is now 

CAPE [Cost Assessment and Program Evaluation], looked at major 

programs and the cost growth in those major programs over several 

decades and correlated that with two things. One was acquisition 

policy, and the other was whether budgets are tight or loose. 

There was no correlation to the acquisition policy changes. Nothing we did seemed to make any difference in the performance of 

programs. Tight budgets and loose budgets had a major impact, 

and the numbers are pretty shocking. 

In periods in which budgets are relatively loose and people can 

manage with some degree of cushion, if you will, in their planning, 

our overruns and production costs are on the order of 10 percent. 

When budgets are tight, they are on the order of 30 percent. It 

makes a huge difference. 

And I thought this was one of the more profound things I have 

seen. I wanted to call it to your attention. We are in a tight budget 

era now. And what this is telling me is that behaviors change in 

a way which leads to major cost overruns when we are in tight 

budgets. 

And we can talk about what those might be. One of them is trying to hang on to things we really can’t afford with the budgets 

that we have and cram more into the budget than it will really 

support and pretend for whatever reason that costs are going to be 

lower than they are actually going to be. And, frankly, I have seen 

some evidence of that sort of thing. 

Industry is hungrier in times like this and it will talk itself into 

bidding more aggressively in order to win the business because it 

is all the business there is to compete for. 

So there are a number of things that may come together to cause 

this impact, but I wanted to point it out to the chairman because, 

as we have looked for ways to improve defense acquisition, this is 

not one of the things we have focused on. 

We looked at a lot of other things, but this has an impact that 

is far beyond any of the other things we have done. And I think 

it is important to note that. 

The CHAIRMAN. Well, I appreciate you mentioning that. 

I have not had a chance to read the study yet, although I did see 

a summary of it and, like you, I started thinking about ‘‘Okay. 

What are the reasons for that? What are the behaviors?’’ 

And maybe one of them is just what we were talking about. 

There is—with tight budgets, there—it is harder to put the resources in up front to get the requirements and the prototyping 

done. So, in effect, it takes more money and more time because you 

don’t put that initial investment into it. 

Secretary KENDALL. Another impact is that we tend to stretch 

out programs. We stretch out the development program. And Crusader was mentioned. Comanche is another example of this where 

programs, because of resource constraints, were stretched out in 

development for years and years and years. 

And I am not quite sure exactly how that impacts unit cost. Part 

of it is the technologies are changing. So we have to redesign for 

them and you end up with more costly technologies. 
34 

Another part is whether you can hold your design team together 

throughout or you end up making changes because of that, as people change on the design teams. 

I think there are a number of things here we have to look at 

more deeply, but I think it is a very important result, nevertheless. 

The CHAIRMAN. Okay. Good point. And we will join you in looking and trying to understand that result. 

I guess the last question I have is—I want to get back to the legislative proposals that you submitted. 

I am sure you have run into a lot of the same reactions that I 

have when talking about improving the acquisition system. It is a 

little bit of eye-rolling and ‘‘Oh, I have heard that story before.’’ 

And there is some skepticism, concern, that you all are just going 

to do something that looks like you are doing something, but it 

doesn’t really matter. 

So my bottom-line question to you is—the legislative proposals 

that you have offered us, we are going to have to take time to look 

at them carefully. But if they were enacted, would it matter? 

Would it significantly help the current situation? 

Secretary KENDALL. The answer is yes. And the reason that the 

answer is yes is that it would give our managers back their most 

precious—it would give our managers back their most precious 

asset, which is time. 

If we can remove bureaucratic burdens on our program managers 

so they can focus on the things that really matter, they will get better performance scores. 

And I think, in general—I use the term ‘‘acquisition improvement’’ as opposed to ‘‘acquisition reform’’ because, to me, ‘‘reform’’ 

implies that there is some big thing we could do which is going to 

make a huge difference. I don’t think that is the case. 

I think what we have to do is attack our problems on many 

fronts and make incremental progress on many fronts, learn from 

our experience and then adopt new things as we understand the 

impact of the things we have done. 

And that is why we have emphasized a continuous process improvement approach in the Better Buying Power initiatives over 

the last several years. And I think that is the right approach. 

I think we will make incremental progress on a lot of fronts. In 

the aggregate, I think it is going to make a big difference. But you 

have to be willing to attack the details on a lot of different aspects 

of acquisition. 

At the end of the day, a great deal of it is about not putting rules 

in place that constrain people, but getting people in a position 

where they can make better decisions and do the right thing and 

then have the institutional support to execute the right thing and 

do it successfully. 

The CHAIRMAN. Okay. Well, I completely agree. 

There are no magic bullets here. It does require continuous effort. And so I will try to use the term ‘‘acquisition improvement’’ 

as well and follow your lead. 

Mr. Langevin. 

Mr. LANGEVIN. Thank you, Mr. Chairman. I appreciate the extra 

time. 
35 

So I just have a couple of subject areas I wanted to touch on. And 

in some ways you have touched on them already, but maybe to 

focus them a little more. 

With a technology like directed energy or a family of systems like 

unmanned undersea vehicles, there are so many variables that affect the demand signal for its development and deployment, things 

like amount and level of R&D funding, the CONOPS [concept of operations], platform availability, specific characteristics of the weapon systems and adversary systems, familiarity of the service with 

the capabilities in question, and the creation of a demand signal, 

affordability of various options, and so on. 

So could you walk us through a little further how those feedback 

loops work. And how does your staff make the decision to turn one 

dial versus another? And how does intelligence—and I know you 

have touched on that already, but how does intelligence about potential adversaries feed into that? 

Secretary KENDALL. It is a great question. And I think at the 

heart of it is our ability to do something different when it is the 

right thing to do, or not. 

What we are good at, I think, in the Department is buying the 

next generation of the thing that we already have, the next-generation fighter plane, the next-generation armored vehicle, the nextgeneration surface combatant, whatever. What we are not so good 

at is recognizing when we have to fundamentally change direction. 

Now, if you look at the offset strategies that Secretary Work 

talks about, one is use of tactical nuclear weapons in the 1950s, 

which was made available because of the fact that nuclear weapons 

had been developed. 

We were in a situation where we were looking at very large-scale 

forces on the Soviet side and we needed something to counter that, 

and it was sort of an obvious thing that we could do. 

The precision weapons offset strategy that started in 1970s and 

we really demonstrated in the 1990s was such an obvious improvement in efficiency on the battlefield that it was sort of an easy one 

to do. 

Directed energy is one that we have talked about forever, but we 

have never been able to get the technology quite to where it is kind 

of over that hurdle of being operationally useful enough. 

The Navy is doing a demonstration project right now with a laser 

on a ship, which is getting up closer to an operational capability, 

but is not really where you would quite like to be. 

So those are technologies that moved forward very incrementally 

over time, but haven’t quite gotten to where we are ready. 

I think, in the case of directed energy, if the performance was 

there, the—the utility of that is so obvious, if you can really do it 

effectively, that it is easy to embrace that. 

Another one that is similar is railguns—electromagnetic launch 

railguns—which we have been working on for decades, also. And if 

you could get that technology, which has advanced quite a bit. One 

of the problems that I mentioned earlier was defensive air bases, 

for example, or defensive ships, high-value assets. 

If you can get to a one-shot-one-kill capability there through either of those two means, that is a huge improvement in capability. 

I think it is one that is fairly obvious to see. 
36 

Others—the use of unmanned systems and undersea environment you talked about—I think we have to think more carefully 

about what the ops concept is and how we would use them and 

think about the operation end to end. So it is not as obvious what 

you would do or how we would use that technology if you got there. 

And we have an effort going on now at the Department called the 

‘‘Long Range Research and Development Planning Program,’’ which 

is being led by our chief system engineer. It mirrors a study that 

was done in the 1970s with a similar name that led to the investments that gave us the precision munitions and the other things 

that we use in the so-called second offset strategy. 

And one of the things that that team that is working now is trying to do is identify the things we should be investing in that 

would make a big difference on the battlefield of the future and 

perhaps identify a third offset strategy that we could work our way 

towards. 

It isn’t quite—to me, at least, it isn’t quite as clear a path as 

some of the earlier two—the earlier two that I mentioned were. 

And I would also point out that all offset strategies are not successful. The Germans did some kind of an offset strategy with submarines in World War II, which came close, but it didn’t actually 

prevail at the time. 

Any real innovation in military operational capability tends to be 

some form of an offset strategy, and getting it right, once you embrace that, is important. 

Now, it is easier to do things where you can integrate the new 

capability into the way you already do business. So in the case of 

railguns or electromagnetic launch or directed energy, I already do 

air defense systems. So it is a different kind of an air defense system, if you will. 

Other capabilities, such as some of the disaggregated we talked 

about earlier, require you to completely stop what you are doing 

and do something different. Those are the hard decisions for the 

Department to make. I think they are hard for any military institution to make. And identifying them and having the courage to go 

forward I think is something that we are going to be challenged by. 

General RAMSAY. I completely agree with Mr. Kendall’s comments. 

I would just offer—I think one term that Mr. Kendall didn’t use 

that we talk about a lot is we are looking at the—if you look at 

our budgets in the last 3 or 4 years, as they have gone down, frankly, we are struggling with this balance of the fight tonight and 

what is good enough for now versus investing in the future. 

And part of investing in the future is: Where are the gamechangers? And that is this third technological offset strategy. That 

really has dominated our conversations across the Department, but 

especially in the resourcing and requirements and acquisition 

world, looking for those game-changers. That is part of what 

LRRDP [Long Range Research and Development Plan] does in the 

whole Innovation Initiative, and that is a, again, an all-hands-ondeck process right now. 

Mr. LANGEVIN. Well, you know, I just hope that, when the gamechanging technology does come on the scene and it is mature 
37 

enough, that we don’t have this, you know, institutional resistance 

to then being able to adopt it, wanting to hold on to legacy systems. 

Directed energy is a particular concern of mine, that, you know, 

when it is there, are we going to be able to adopt it quick enough. 

You know, Mr. Secretary, you are a bit, maybe, more optimistic 

than I would be when you talk about the utility of it is so obvious. 

But I also get concerned about the institutional resistance to 

adopting new technologies quickly when we are so used to, you 

know, the missiles or, you know, things like Phalanx that, you 

know, would be used as the kind of kinetic defenses that lasers 

could be much more effective at once we employ them. But I understand that the technology does have a little ways to go still. 

But the last thing I had is: Do you believe that the current procurement process is so long that the technology becomes obsolete 

by the time it reaches the warfighter? 

And how do we avoid these issues in areas such as cyber where 

procurement timelines are so mismatched with budget timelines? 

Secretary KENDALL. We understand that—well, first of all, when 

we do a very complicated weapon system, it is going to take some 

time. It is going to take some time to do the design and then to 

do all the testing of all the features associated with that system. 

And during that time some technologies are going to move forward and the threats are going to move forward. So you have to 

build into your design, through what we call modular designs or 

through open systems architectures, the ability to do upgrades to 

that initial system as you go along and sometimes to make changes 

in progress if the threat dictates that. 

If you look at—I am going to use the F–35 as an example. We 

have gone through a series of technology insertions on the F–35 already in terms of processing capability. There are probably more of 

those in the future. 

We have asked for—and we had some difficulty with the Congress on this, but I think we have worked our way past that— 

funds to start the follow-on development for the electronic protection systems, for example, that we are going to need in the future 

after the initial fielding of the full capability. 

So you have to design in the flexibility and the process and then 

secure the funding in a phased way to improve your products over 

time and to take account for the fact that technologies and threats 

are both going to be changing as you are going through the product 

life cycle. 

Mr. LANGEVIN. Very good. 

Well, thank you both for your testimony and your patience. 

And, Mr. Chairman, thank you for the extra time. And I yield 

back. 

The CHAIRMAN. No. I appreciate the gentleman’s questions and 

the issues he raises. 

Thank you both for being here. 

Mr. Kendall, as we work our way through the proposals that you 

have made, as we discuss with you ideas that we have and from 

others, I hope we can keep this as a continuous process, as you describe, so another package maybe next year and another one the 

year after that and another one the year after that, because it is 

going to take that continued persistence to get at the many com-
38 

plex issues that you raise. That is certainly going to be a priority 

of this committee. 

And I appreciate the time and effort and the cooperation that you 

and your folks have put into it so far. So I look forward to that. 

Secretary KENDALL. Thank you, sir. Same here. 

The CHAIRMAN. Yes. Again, thank you all for being here. 

And, with that, the hearing stands adjourned. 

[Whereupon, at 11:44 a.m., the committee was adjourned.] 
A P P E N D I X 

JANUARY 28, 2015 

PREPARED STATEMENTS SUBMITTED FOR THE RECORD 

JANUARY 28, 2015 

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WITNESS RESPONSES TO QUESTIONS ASKED DURING 

THE HEARING 

JANUARY 28, 2015 

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RESPONSE TO QUESTION SUBMITTED BY MR. PETERS 

Secretary KENDALL. The August 2014 Competition Guidelines and my associated 

memorandum provided a list of actions the Department is taking to promote competition consistent with the Better Buying Power (BBP) 2.0 Initiatives. The Guidelines were intended to complement and work in concert with the overarching principles identified in BBP 2.0, and to provoke thought about strategies useful for creating and maintaining a competitive environment throughout the life cycle of products and services, including IT acquisitions. The guidance and requirements are 

being incorporated in the Defense Federal Acquisition Regulation Supplement Procedures, Guidance, and Information in FY 2015. 

Additional guidance specific to IT acquisitions is in the Department’s DoD Open 

Systems Architecture (OSA) Contract Guidebook for Program Managers. The Guidebook contains recommendations for writing a strong, OSA-based statement of work, 

guidance on special contract requirements, recommended contract line items, and 

guidance on obtaining intellectual property and data rights to support and enhance 

competition throughout the full life cycle. 

Last fall, as the chair of the Business-Senior Integration Group (B–SIG), I began 

focusing senior leader attention on competition measures to increase visibility and 

accountability. The B–SIG is addressing the Department’s competitions results, 

tools, trends and guidance to increase competition. On a quarterly basis, the Acquisition Executives present their competition results and respective efforts to improve 

competition achievements. [See page 18.] 

QUESTIONS SUBMITTED BY MEMBERS POST HEARING 

JANUARY 28, 2015 

(73) 

QUESTIONS SUBMITTED BY MR. TURNER 

Mr. TURNER. In the 2013 Performance of the Defense Acquisition System Report, 

you noted that ‘‘the time required to acquire next-generation capabilities is often 

longer than the strategic threat and technology cycles these capabilities are meant 

to address.’’ Additionally, you further concluded that ‘‘while most cost growth measures are improving, median cost growth across the MDAP portfolio is not zero and 

will likely lead to near-term affordability challenges given flat or declining fiscal resources.’’ Given the historic and continuing inability to deliver capabilities that are 

ahead of the threat, what can Congress and Industry do to help resolve this dilemma in view of declining resources? 

Secretary KENDALL. Besides addressing the declining resources directly by eliminating sequestration, there are a number of additional things that can be done. 

Support for legislative reforms that reduce the statutory overhead and bureaucracy faced by Department of Defense (DOD) program managers and their teams is 

an area in which assistance from Congress and Industry is needed. This will allow 

program managers to be more agile, enabling them to spend their limited time more 

effectively addressing evolving threats, controlling cost, mitigating risk, and meeting 

schedule while expending less time on bureaucratic requirements that do not add 

value and that create unnecessary paperwork. 

Legislative assistance to efficiently deal with the inevitable technical challenges 

that most programs encounter in managing lengthy development efforts and keep 

agile in dealing with evolving threats would be extremely helpful. 

The Department needs industry to focus its Independent Research and Development on timely and cost-effective new capabilities in response to external threats 

and is working to improve Industry’s access and understanding of intelligence on 

evolving threats. In turn, Industry needs to bring forward open systems that allow 

insertion of innovative solutions to address threat evolution. It is also necessary for 

companies that support DOD to help the Department better understand and tap the 

rapid innovation and technology development in the commercial sector. 

Finally, Industry information and bids must be realistic and offer timely, pragmatic solutions. What is often termed ‘‘low-balling a proposal,’’ failing to recognize 

and manage risks, or offering overly complicated weapon systems increases the likelihood for problems down the road and detracts from national security. It is crucial 

that the Department, Congress, and Industry work together to recognize and manage risks, be willing to cancel or fix failing efforts despite sunk costs or equities, 

and be more flexible in response to changing technologies and threats. 

Mr. TURNER. Should broader and more profound use of industry innovations 

through rapid fielding and deployment be part of the solution? 

Secretary KENDALL. I recently revised Department of Defense (DOD) Instruction 

5000.02 to include an enclosure on rapid acquisition, which states ‘‘DOD’s highest 

priority is to provide Warfighters involved in conflict or preparing for imminent contingency operations with the capabilities urgently needed to overcome unforeseen 

threats, achieve mission success, and reduce risk of casualties, as described in DOD 

Directive 5000.71 (Reference (cc)). The objective is to deliver capability quickly, 

within days or months.’’ 

Rapid acquisition allows new and innovative capabilities, often derived from reapplication of technologies originally developed for non-military purposes, to be 

quickly placed in the hands of the warfighter for assessment and adoption. These 

rapid acquisition programs offer opportunity to generate insight and understanding 

that can help drive innovation into more deliberate programs of record. 

Mr. TURNER. Does the Department have the budget and legal authority flexibility 

it needs to further exploit industry innovations through rapid fielding and deployment of leading edge technologies? 

Secretary KENDALL. I believe the Department has sufficient legal authority and 

flexibility to execute rapid acquisition programs when operating under a normal and 

timely budget process. Our efforts over the last few years have been impacted by 

Continuing Resolution Authorities. This may impact and burden our efforts to execute rapid acquisition efforts in a timely manner. 
74 

Mr. TURNER. Does the Department view rapid fielding and deployment of industry 

innovations as either a method of spurring industry investment, by better assuring 

a competitive return, or solely as a method of getting technologies to the war-fighter, or both? 

Secretary KENDALL. The Department recognizes that rapid fielding and deployment of industry innovations offers multiple benefits. I recently revised Department 

of Defense (DOD) Instruction 5000.02 to include an enclosure on rapid acquisition, 

which states ‘‘DOD’s highest priority is to provide Warfighters involved in conflict 

or preparing for imminent contingency operations with the capabilities urgently 

needed to overcome unforeseen threats, achieve mission success, and reduce risk of 

casualties, as described in DOD Directive 5000.71 (Reference (cc)). The objective is 

to deliver capability quickly, within days or months.’’ 

The Department also recognizes that our rapid fielding programs provide a mechanism to provide timely feedback to industry on our utilization of their solutions to 

urgent military needs, which can facilitate aligning industry efforts with Warfighter 

needs. 

In Better Buying Power 3.0, I have a focused initiative on incentivizing innovation 

in industry and government. 

QUESTIONS SUBMITTED BY MR. ROGERS 

Mr. ROGERS. Mr Kendall, last year the Department provided Congress with a Satellite Communications Strategy Report. An important point was made in this report. 

The report stated that: 

‘‘Currently, funding for commercial SATCOM is decentralized and allocated to the 

Combatant Commands, Services, and DOD Agencies, with task orders based on individual component needs, and with limited regard for sharing opportunities between components. This decentralized approach impedes centralized, multi-year acquisition and hinders the DOD’s ability to manage MILSATCOM and commercial 

SATCOM as a holistic capability to best support the warfighter.’’ 

What are your thoughts regarding centrally procuring SATCOM, to include multiyear acquisition of communications satellite communications? Considering we spend 

billions of dollars on satellite communications (both military and commercial), what 

other improvements do you think need to be made regarding better acquisition of 

this important capability? 

Secretary KENDALL. The Department of Defense already centrally funds and procures MILSATCOM. The Defense Information Systems Agency centrally procures 

most (about 70% and increasing) commercial satellite communications 

(COMSATCOM) services. In my opinion, central funding has merit to satisfy predictable, enterprise-level COMSATCOM requirements. For example, in the FY 2012 

President’s Budget, DOD proposed a centrally-funded, multi-year capital lease of a 

commercial satellite to satisfy requirements in the United States Central Command 

area of responsibility. DOD estimated that under operational conditions at the time, 

this investment would have been recouped within 2–3 years by avoiding the cost of 

annual COMSATCOM task orders. Congress redirected funds to procure Wideband 

Global SATCOM #10 so the estimated return on this proposed COMSATCOM investment was never verified. In a series of small-scale ‘‘pathfinder’’ initiatives, we 

have begun to explore other improvements to better acquire and manage 

COMSATCOM. Acquisition pathfinders will examine multi-year service contracts, 

on-orbit and pre-launch purchases of COMSATCOM, and purchases of global portable bandwidth. Operational management pathfinders will examine utilization monitoring and enterprise-level sharing of COMSATCOM resources to increase effectiveness and efficiency. DOD will report its pathfinder plan to Congress in response to 

Section 1605 of the FY 2015 National Defense Authorization Act—Pilot Program for 

Acquisition of Commercial Satellite Communication Services. As evidence warrants, 

pathfinder concepts can be scaled to enterprise-wide solutions. 

Mr. ROGERS. Related to acquisition of military satellites, I’d like to better understand your perspective on how to lower costs yet continue to increase capabilities 

of our space programs. I’m thinking about programs such as missile warning and 

protected communications satellites. Historically, has it been more cost-effective to 

incrementally upgrade existing capabilities or start new space programs? 

Secretary KENDALL. Our past data and analyses demonstrate that it has historically been more cost effective to increase the capabilities of our space assets by incrementally upgrading our existing space programs. However, recent trends in space 

procurement may impact cost effectiveness and alter our strategy to meet requirements. For example, the rise of space commercialization and the emergence of 

standard satellite buses for dual commercial and military use have afforded the De-
75 

partment more flexibility in our space acquisition approaches. Additionally, as identified by last year’s Space Strategic Portfolio Review, the mounting threat to our 

space capabilities may require dramatic change to the configuration of our satellites 

and overall architecture, potentially driving significant transformation rather than 

evolutionary improvement. 

For every program, we need to carefully review alternate acquisition approaches 

to find the most cost effective path for the particular needs of the Warfighter. Therefore, we are currently conducting Analyses of Alternatives (AoAs) for the missile 

warning and protected communications satellite programs to determine the best 

path forward for these two mission areas. The Space Based Infrared System and 

Advanced Extremely High Frequency satellite program have recently awarded new 

contracts for two satellites each to replenish existing on-orbit capabilities. Emerging 

threats coupled with an increasingly austere budget environment compel the Department to perform these AoAs and supporting analyses to inform the next set of 

acquisition decisions. 

Mr. ROGERS. I’m concerned about space governance in the Department. Particularly when I see programs such as the Navy Mobile User Objective System (MUOS), 

with the first satellite launched about 3 years ago and the 3rd satellite recently 

launched, and only 10% of the capability of these three satellites able to be used 

because of delays in ground and user terminals. The Navy leads the space and 

ground components, while the Army leads the user terminals. There are many other 

examples of space programs that are not properly synchronized across the various 

segments. Is this lack of synchronization an acquisition problem, a leadership problem, a money problem? How do we fix this? 

Secretary KENDALL. Better planning and acquisition oversight is needed to improve program synchronization issues in conjunction with improved metrics and 

more specific definitions. 

Based on a recently completed study briefed to the Defense Space Council in December 2014, the Department is implementing a standard assessment of integration/synchronization across the space portfolio more closely integrated with the 

budget formulation and deliberation process. As I indicated in my January 26, 2015, 

letter to the congressional defense committees, the Department will be submitting 

an initial exemplar report covering a single representative program (Space Based 

Infrared System) in June 2015, and a comprehensive initial annual report with submission of the FY 2017 President’s Budget. While this initial report is overdue to 

Congress, the definitional and procedural framework needed to accomplish such an 

assessment in a consistent, repeatable manner was needed. Additionally, this approach can be applied for future programs being approved at Milestone B in order 

to fulfill the statutory requirements contained in the FY 2013 NDAA. 

QUESTIONS SUBMITTED BY MR. SHUSTER 

Mr. SHUSTER. What must be done by both the services and Congress to facilitate 

greater use of open architecture, modularity, and defense-owned technologies/software/programming to reduce overall acquisition costs and timelines? 

Secretary KENDALL. Department of Defense (DOD) acquisition policy holds program managers responsible for applying modular, open systems architectures in 

product designs where it is feasible and cost effective. I expect program managers 

to make maximum use of appropriate modular, open systems approaches to enable 

competition, facilitate reuse, and ease technology insertion. These approaches are 

documented and approved in our program acquisition strategies. 

DOD uses a broad array of approaches to managing and reusing the technology 

and software rights that we own, including use of enterprise-wide licenses, code repositories, and open source software, where appropriate. Under Better Buying 

Power 3.0, our initiatives on removing barriers to commercial technology utilization 

and emphasizing technology insertion and refresh in program planning are targeted 

at improving our ability to manage technologies and better leverage the rights we 

own and license. 

At this time, I do not believe the department requires any additional congressional action in this area. 

Mr. SHUSTER. What are the biggest threats to continued American dominance in 

the area of military technology? 

Secretary KENDALL. We are concerned that other advanced states, in particular 

Russia and China, are pursuing modernization programs that are focused on defeating specific systems that provide the United States with the capabilities that enable 

us to project power globally. The scope and rate of global development in ‘‘anti-access/area-denial’’ systems puts our technological superiority at risk. 
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Details of particular threats to U.S. Military capabilities have been provided in 

recent classified briefings to Members. My staff and I are prepared to provide additional details on these areas if requested. 

One area of particular concern is the proliferation of advanced land attack and 

anti-ship cruise and ballistic missiles, with associated developments in technologies 

that improve accuracy and attempt to counter missile defenses, as these extend the 

ability and effectiveness of threat surface forces, surface ships, bombers, and submarines to hold U.S. forces, installations, and the capabilities of our allies and partners at risk at extended ranges. Another area concerns the proliferation of advanced 

missile and air defenses and the emergence of foreign 5th generation fighters with 

low observability, advanced weapons, and advanced sensors that offer challenges to 

future U.S. air dominance and strike capabilities. In addition, emerging capabilities 

in electronic warfare threaten sustained U.S. dominance of the electromagnetic 

spectrum, with implications across multiple warfighting domains. Areas where the 

United States has long held significant advantage, such as in the space and the undersea environments, are increasingly challenged by the number and sophistication 

of military systems being employed by other states. 

Mr. SHUSTER. Are there any specific military areas where the United States is 

falling critically behind in the area of technological development? How can we better 

streamline the research and development process to foster innovation? 

Secretary KENDALL. The United States remains the predominant military power 

in the world. We are concerned that other advanced states, in particular Russia and 

China, are pursuing modernization programs that are focused on defeating specific 

technological capabilities that provide the United States with critical capabilities 

that enable us to project power globally. The scope and rate of global development 

in ‘‘anti-access/area-denial’’ (A2/AD) technologies puts our technological superiority 

at risk in the near future if we fail to respond to the altered strategic landscape. 

Details of particular threats to U.S. military capabilities have been provided in 

recent classified briefings to Members. My staff and I are prepared to provide additional details on these areas if requested. 

The Department’s Better Buying Power 3.0 initiatives are intended to focus our 

acquisition and development communities on the need to focus on harnessing American innovation to insure continued technical dominance in the national security 

arena. These include initiatives focused on reassessing our internal and external research and development (R&D) efforts to maximize the return on every dollar invested, efforts to coordinate industry and government R&D more effectively, efforts 

to ensure that our development programs are informed by intelligence on emerging 

threats, efforts to ensure that programs plan for continuous technology refresh to 

insure that our capabilities keep up with globalized technologies, and efforts emphasizing the importance of appropriately aligning incentives for government and industry to ensure that we achieve innovative, cost-effective solutions in our acquisition programs. 

Mr. SHUSTER. How serious is requirements creep? Are requirements for new 

weapons programs adequately understood and current? Does our current system of 

assessing future requirements for new programs sufficiently assess the future needs 

of the warfighter and accurately project future technological changes? 

Secretary KENDALL. Changing requirements are sometimes unavoidable and an 

ongoing challenge. Technology vectors, operational concepts, and resulting requirements for new weapon systems are reasonably well understood and current when 

we baseline programs, but the future always involves uncertainty. Technologies 

evolve. New technologies emerge. Threats change. Opportunities arise. Unknowable 

problems are discovered in development. This area is a focus of Better Buying 

Power 3.0, as we do believe our system needs to improve its ability to recognize and 

integrate changes to reflect the changing environment appropriately. 

Mr. SHUSTER. When and how do you best make the call that a program has 

reached the end of its lifespan and incremental upgrades are no longer worth the 

cost vs. the benefits gained? 

Secretary KENDALL. The acquisition community works with the Services to determine the best way to acquire a system that satisfies requirements that have been 

validated by the Joint Requirements Oversight Council. This includes whether an 

upgrade to an existing system or a new design is the best approach and is affordable 

in meeting the capability needs. Analyses of Alternatives consider these trades in 

the early stages of programs; the Department also considers this important trade 

before any new increment of capability for a system is initiated. At some point, the 

cost-benefit of upgrading a system may no longer be affordable relative to starting 

a new program. At that point, the Department will no longer invest in upgrades for 

the existing system and will consider a new program instead. The existing platforms 
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will remain in service for the remainder of the planned service life or until the new 

system is deployed. 

Mr. SHUSTER. Should we defer development of entirely new weapons systems until 

all of the technology exists to create it? Is it better to aim for more distant technology in a large package program with the hope that it will spur development? Or 

does it make more sense to design new programs around technology that is already 

proven? 

Secretary KENDALL. Developing weapon systems requires careful judgment of 

technological, operational, and financial risks. Systems designers must balance the 

likelihood that a technology will mature as predicted, integrate as planned, and deliver capabilities as promised as they identify and refine solutions to Warfighter 

needs. Staying ahead of the threat often requires taking informed risks to make 

timely delivery of the necessary difference-making performance. In these cases, active risk management and identification of technology risk mitigation alternatives 

should form the basis of a program’s development plan. Weapon system programs 

should plan for technology insertion and refresh, not only to reduce risk, but also 

to keep pace with threat and obsolescence. This can be accomplished through wellcrafted acquisition and contract strategies and through system designs and architectures that enable technology insertion or upgrade. 

Mr. SHUSTER. Given the rapid pace of technological advancement, what is the best 

approach to keeping our weapons systems current? Should the focus be on developing and fielding entirely new systems or incremental upgrades of the units we already have? 

Secretary KENDALL. Weapon system programs should plan for technology insertion and refresh, not only to keep pace with technological advancement, but ultimately to keep up with the latest threats. This can be accomplished through acquisition and contract strategies that plan for incremental capability delivery or system 

upgrades, as well as system designs, open architectures, and owning appropriate 

data rights that affordably and effectively enable modification and upgrade. Determining the appropriate acquisition and system design strategy involves careful assessment of opportunities, costs, and risks; and requires continuous dialogue between acquisition, requirements, and intelligence communities. The strategic decision on when to pursue a new system vs. upgrading existing systems must be informed by careful analysis of the cost and performance tradeoffs, the projected 

threats, and our operational and strategic approach to countering them. The impact 

on system life-cycle supportability is also a key consideration. 

QUESTIONS SUBMITTED BY MR. GIBSON 

Mr. GIBSON. In response to battlefield commanders’ demands to field cutting edge 

radios that provide not only voice but data, imagery, and video, the Army—under 

your guidance—has moved to the concept of a radio market place with multiple vendors annually vying for delivery orders. Can you elaborate on why this model works 

for communications technology and how this strategy may be applied to other areas 

in DOD? 

Secretary KENDALL. The model has significant potential because radio technology 

has shifted toward being software defined. The Department of Defense (DOD) has 

encouraged industry to adopt this modern approach through DOD’s advance of the 

Software Communications Architecture (SCA) and open standard interfaces. The 

Department has also created a DOD Information Repository to provide vendors with 

software designed waveforms as government furnished equipment (GFE). These 

GFE waveforms can then be hosted on SCA compliant radios, thereby reducing the 

development time and cost and improving interoperability. The result is a current 

market place of more than 63 types of tactical radios that allow the flexibility to 

insert new features and capabilities as they become available. In order to capitalize 

on this new technological approach, a more agile and flexible testing environment 

must exist, allowing industry to rapidly bring their tested and proven capabilities 

to the user. 

Why more frequent delivery order competes? 

The shift in communications technology has allowed the Department to change its 

tactical radio acquisition strategy toward a non-developmental item (NDI) approach. 

The old acquisition strategy of developing new communications requirements and 

building a program of record to develop, test, field, and then maintain that single 

device over its life cycle does not align with the state of technology and rapid acquisition. Software Defined Radios (SDR) are designed to be modular, reprogrammable, 

and upgradeable. By adopting an NDI approach and spreading out delivery orders, 

the Army can add new industry developed capabilities (i.e. applications) to an exist-
78 

ing radio, as well as capitalize on industry developed technology improvements such 

as faster processors, lower power consumption, longer battery life, and reduced 

weight. 

Could this strategy be applied to other areas in DOD? 

This is something that is being assessed. It works for tactical radios because industry has moved toward SDRs and embraced the SCA as an open systems architecture approach that facilitates the reuse of GFE furnished waveforms. For any DOD 

system that relies on software as its fundamental offering, NDI (software) approaches could mitigate lengthy and costly development. 

In summary, in adopting a NDI approach with GFE waveforms for radios and 

communications systems provides insight as to how other software heavy DOD systems could leverage NDI software approaches to speed delivery, accelerate modernization, and reduce overall costs. 

QUESTIONS SUBMITTED BY MR. COOK 

Mr. COOK. Do you believe it’s necessary that UAVs remain covered by the Missile 

Technology Control Regime if their primary use is for tactical military and intelligence surveillance missions? 

Secretary KENDALL. The MTCR plays an important role in restricting the proliferation of missiles and delivery systems for Weapons of Mass Destruction (WMD), 

including equipment and technology. The MTCR decreases the risk of WMD delivery 

systems falling into the hands of terrorist groups and individuals and rogue states. 

Unmanned Aircraft Systems (UAS) that are capable of delivering a payload of 500 

kg or more to a range of at least 300 km fall under MTCR Category I. Consistent 

with our MTCR commitments, these MTCR Category I UAS are subject to a strong 

presumption of denial, but have been approved for export on rare occasions that are 

well justified in terms of the nonproliferation and export control factors specified in 

the MTCR Guidelines. 

However, many UAS are not capable of delivering a payload of at least 500 kg 

to a range of at least 300 km, do not fall under MTCR Category I, and thus do not 

have a strong presumption of denial. Indeed, the United States has exported such 

UAS to a number of partners. U.S. export policy for military UAS balance the need 

to maintain the long-standing U.S. commitments under the MTCR while also providing a framework to ensure trusted partner nations have access to U.S. unmanned 

systems, thus relieving some of the burden on U.S. forces and enabling interoperability with our partners in coalition operations. 

Mr. COOK. How will this export restriction impact U.S. companies manufacturing 

UAVs from competing on the global market? 

Secretary KENDALL. The United States has the most advanced Unmanned Aerial 

System (UAS) industry in the world, and I believe the recent changes in U.S. military UAS export policy will benefit the U.S. industrial base by advancing U.S. industry participation in the UAS world market. The new UAS export policy recognizes that an increasing number of nations are developing, acquiring, and employing 

UAS. Under the new policy, U.S. export authorities will examine potential UAS 

sales under the U.S. Conventional Arms Transfer Policy on a case-by-case basis and 

require receiving nations to agree to the following as a condition of sale: 1) sales 

and transfers of Missile Technology Control Regime (MTCR) Category I, armed, and 

other advanced UAS must take place through the government-to-government Foreign Military Sales program; 2) end-use assurances; 3) end-use monitoring; and 4) 

agreement to principles for proper use. The United States is committed to working 

with other countries to shape international standards for the sale, transfer, and use 

of military UAS. Fortunately, other current and likely exporters of MTCR Category 

I UAS systems are also members of, or have aligned their export policies with, the 

MTCR. 

Mr. COOK. Do you believe it would benefit interoperability with our allies if our 

nation had a level playing field in order to sell UAVs to our international partners 

and allies? 

Secretary KENDALL. Not only do the international sales of U.S. Unmanned Aerial 

Systems (UAS) benefit the United States through relieving the burden on U.S.- 

owned assets during coalition operations, but sales of U.S. UASs increase the opportunities for interoperability with our allies as well. The NATO Alliance Ground Surveillance (AGS) is a good example of how the sale of Global Hawks under a cooperative program will enable interoperability through the potential sharing of Intelligence, Surveillance, and Reconnaissance (ISR) data in future NATO operations. 

NATO AGS is the backbone of NATO’s Joint ISR initiative that will integrate infor-
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mation and data from NATO AGS and other national manned and unmanned ISR 

assets at the Main Operating Base in Sigonella, Italy. 

Mr. COOK. Does DOD plan to update the export controls on UAVs to control their 

export in a manner that improves interoperability with our allies and levels playing 

field on the competitive global market? 

Secretary KENDALL. Not only do the international sales of U.S. Unmanned Aerial 

Systems (UAS) benefit the United States through relieving the burden on U.S.- 

owned assets during coalition operations, but sales of U.S. UASs increase the opportunities for interoperability with our allies as well. The NATO Alliance Ground Surveillance (AGS) is a good example of how the sale of Global Hawks under a cooperative program will enable interoperability through the potential sharing of Intelligence, Surveillance, and Reconnaissance (ISR) data in future NATO operations. 

NATO AGS is the backbone of NATO’s Joint ISR initiative that will integrate information and data from NATO AGS and other national manned and unmanned ISR 

assets at the Main Operating Base in Sigonella, Italy. 

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