DOD's outdated acquisition system hinders mission success, panel says

The Defense Department’s antiquated acquisition system and policies present major problems for DOD in fulfilling today’s mission needs and contribute to government cost overruns, a congressional acquisition reform panel has concluded in a recent report.

“The panel found that while the nature of defense acquisition has substantially changed, the defense acquisition process has not kept pace,” the report stated. “As a result, the Department’s formal acquisition policy has limited application to the majority of [its] acquisitions.”

To successfully reform DOD’s approach to acquiring weapons, services and other goods, the panel recommended “significant improvements” in managing the acquisition process, developing and incentivizing the highest quality workforce, improving financial management, and maximizing the industrial base.

A performance management structure that allows DOD's senior leaders to identify and correct problems and offer reinforcement would improve performance metrics, for which there is currently only “anecdotal information,” the report stated. To implement such a structure, the panel recommended the expansion of the Office of Performance Management and Root Cause Analysis to track organizations based on predetermined performance benchmarks, which would promote real consequences, according to the report.

DOD "leaders should be focused on identifying and addressing the acquisition systems strengths and weaknesses, not on second-guessing the programmatic decisions made by those in the field,” the report said.

Better performance management for the requirements process, on which acquisition depends heavily, also is necessary, the panel found. It expressed alarm over DOD’s ad hoc approach to developing requirements for the acquisition of services, as well as the “overly cumbersome” and inadequate approach to weapons requirements.

The panel also is pushing for more accountability across all aspects of the acquisition process, particularly for DOD financial management. “The inability to provide accurate and timely financial information prevents DOD from adequately managing its acquisition programs and from implementing true reform,” the report stated. It added that with 86 percent of government assets – with an estimated value of $4.6 trillion – DOD must maintain strong financial and business management.

Accountability in the use of contractors is also important for acquisition reform, the panel found, calling for better use of the broader industrial base and trustworthy contractors. DOD "is best served when it deals with responsible contractors. Contracting officers need access to accurate information on contractors that are known to be in violation of the law” in order to determine if a contractor is responsible, the report said.

The House Armed Services Committee commissioned the Defense Acquisition Reform Panel in March 2009.