AT&L Hot Topics in Acquisition

1. AT&L Hot Topics in Acquisition Presentation for DAU 9 August, 2006

2. Acquisition and Technology Providing Value-Added Oversight and Coherent Strategic Direction for Reduced Cycle Time, Increased Competition and Predictable Performance Examples of Initiatives Concept Decision/Time Defined Acquisition Capital Budgeting Risk-Based Source Selection Defense Acquisition Executive Summary (DAES) IIPT/OIPT/DAB/Portfolio Management Processes Systems of Systems/Centers of Excellence Award/Incentive Fee Policy/FAR/DFAR Δ’s Acquisition of Services Policy Human Capital Strategic Planning Lead Systems Integrator/Spiral Acquisition Industry and Congressional Outreach “THE WILL TO CHANGE…”

3. Concept Decision Toolkit MS C Stronger Emphasis Technology Development—TRL/IRL MRL Science and Technology Base • RISK-BASED SOURCE SELECTION • Reducing Risk and Improving Source Selection • CAPITAL ACCOUNTS • Program Funding Stability • TRI-CHAIR CONCEPT DECISION • Improved Process Alignment • Focused on Department Investment Decision Options • Time Defined determinations MS A MS B CD B’ FRP DR JCD EOA Rpt CDD CPD EOA Strategic Planning Guidance TechDev Joint Concepts O&S SDD FAA FNA PD CDR COCOM FCB OSD/JCS • TIME DEFINED ACQUISITION STRATEGY • Multiple Customer-Focused Paths to Speed Fielding of Capability • Post-Initiation Stability Initiatives CD Methodology—Broad Acquisition Initiatives

4. Why do Concept Decision? Challenge: Maximize Process Change…Minimize Bureaucracy • Accelerate delivery of Joint warfighting capabilities • Current process slow to respond to warfighter needs • Address resource/funding constraints early • Necessary to control cost growth/requirements creep • Adequately fund and stabilize funding stream • Tailor analysis to support decision at hand • Not all programs require extensive, time consuming and costly additional analytical efforts • Leverage Service/organizational competencies • Delegate execution • Minimize oversight

5. “As Is” Process MS A MS B MS C Production & Deployment Incremental Development • As Is: • Serialized • Program-Centric • Closed Aperture • Significant Early Service • Commitment of Resources Existing Focus Here Concept Decision Full Rate Prod DR JCD ICD CDD CPD System Development & Demonstration Strategic Planning Guidance AoA Joint Concepts Concept Refinement Technology Development FSA FAA FNA O&S FCB COCOM OSD/JCS Technology Development—TRL/IRL MRL Science and Technology Base

6. MS B MS C Concept Decision MS A Production & Deployment Incremental Development Stronger Emphasis Technology Development—TRL/IRL MRL Science and Technology Base New “To Be” Process • To Be: • Aligned • Capability Orientation • Open Aperture • Joint • Broad Range of Options Future Focus Here Full Rate Prod DR JCD EoA Report CDD CPD System Development & Demonstration Strategic Planning Guidance EoA Joint Concepts Technology Development FAA FNA O&S FCB COCOM OSD/JCS

7. Concept Decision:Notional Next Layer JCD sponsor drafts, PA&E approves, Tri-Chair directs CORPORATE TRI-CHAIR INVESTMENT DECISION CCJO, JOCs, JFCs and JICs A B C FCB, COCOM, Service–led Requirements FULL Technology Maturity CONOPS EoA Guidance Affordability CPD Concept Decision Tailored JCD 2 1 3 FNA Time-Defined Acquisition FAA CDD Initial Operational Capability EOA COCOM Service ICD PORTFOLIO Based: Investment Strategy Competitive Solutions Balance Risks Establish Baselines Rapid COCOM/Service/Agency FCB assesses, prioritizes gaps, shortfalls, and redundancies/offsets 0 < Years < 8 BOUNDED SOLUTIONS (I.E. 40 TO 80%)

8. Concept DecisionFrom / To Savings

9. Time-Defined Acquisition • A Customer-Focused Concept that: • Enhances system agility • Capitalizes on Rapid Acquisition Authority and the Concept Decision • Employs a time-sensitive acquisition approach emphasizing Customer Response and designed to provide capability when it is needed • Uses three risk-based criteria to determine the Acquisition Strategy: • Time to delivery • Requirement certainty • Technology maturity • Rapid requirements Triage via Gatekeeper function inherent in Concept Decision methodology • Enhanced by Enabling Actions: • Requirements Stability • B “Prime” CUSTOMER NEED Rapid Limited Full 6 mo – 2 yrs 2 – 4 yrs 4 – 8 yrs TIME-DEFINED ACQUISITION STRATEGY MILITARILY USEFUL CAPABILITY Our First Priority is to Produce Useful Capability for the Warfighter When Needed

10. Requirements Stability—A Time-Defined Enabler IMPLIED AND DERIVED REQUIREMENTS UNDERSTOOD BASE KNOWLEDGEOF REQUIREMENT - Key System Attributes DEVELOPMENT CONTRACT AWARD MS A MS B MS C CD FRP DR B’ JCD EOARpt CDD CPD Joint Concepts TechDev O&S SDD FAA FNA EOA PD SPG CDR RqmtsStabilized OSD/JCS COCOM FCB Proposed Requirements Stability Potential B “Prime” • No changes that may result in additions or extensions to baselined cost or schedule after CDR unless approved by the MDA and Requirements Approving Official • If such a change is approved by specified authority, it shall be self-financed and shall NOT impact schedule • Default policy should be to defer proposed changes to follow-on increment • A logical point, subsequent to Contract Award, where “Implied” and “Derived” requirements are known • At System CDR, or “B Prime,” that knowledge is available. There should be a required APB review at this point so we can assess the cost and schedule impact and identify non-value added cost drivers

11. Funding Stability MS A MS B MS C CD FRP DR JCD EOARpt CDD CPD Joint Concepts TechDev O&S SDD FAA FNA EOA PD SPG Funding Stability OSD/JCS COCOM FCB • Capital Accounts • A financial initiative designed to provide stability in the budgeting system and to establish accountability for acquisition programs throughout the hierarchy of program responsibility • Implements a risk-informed investment strategy reflecting joint warfighter priorities • Consistent with the QDR and section 1004(a) of the FY 06 Authorization Act, the Department is exploring capital accounts to stabilize funding for selected major programs • Process will be part of the larger risk-informed investment strategy used to inform future investment decisions.