Purpose Inform you of recent changes in OSD policies regarding - - PDF document

Recent changes in DOD Acquisition Rules Professor Woody Spring DAU woody.spring@dau.mil 619 524 5098

Purpose

• Inform you of recent changes in OSD policies

regarding Acquisition

• DAU Charter is to help improve acquisition
• utcomes

– Helping industry understand the rules programs are supposed to be follow can help you prepare better proposals and better give the Program Managers what they need

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DoDI 5000.02 Interim: November 25, 2013 Final: 7 January 2015 Overview – Some of the Interim DoDI 5000.02 Changes Affecting T&E

• DoDI 5000.02 to be revised within 180 days. (7 Jan

2015)

– Interim DoDI 5000.02 was effective 11/25/2013 – Interim DoDI 5000.02 incorporates BBP initiatives, & several directive type memos (DTMs)

• New Generic Acq Program Structure & Decision Points

– Four Defense Acq Program Models, and two hybrids

• New Encl 4 (DT&E), and Encl 5 (OT&E, LFT&E)

– Milestone A TEMP (vice TES) – Lots of changes / additions to the TEMP content – Expect DAG Chapter 9 TEMP format to reflect these changes (the next time they update DAG Chapter 9 – probably soon)

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Interim DoDI 5000.02 TEMP Changes

• Some of the TEMP changes are as follows.

– For a complete list, see Encl. 4, Para 5; & Encl. 5, Paragraphs 5 through 9

• Milestone A TEMP (vice TES)
• Identify each major DT phase or event as contractor or Govt. DT
• More Cybersecurity testing required
• A TEMP annex, with the component’s rationale for requirements
• More software maturity metrics and software testing
• An OT evaluation overview, including synopsis of the intended

analysis for each major OT test phase or event

• Table of variables (factors & conditions) that may have a

significant effect on operational performance

– Starting at MS B, the “levels”, and methods of controlling variables during test events must be stated

• Incorporates elements from BBP 1.0, 2.0, and some of 3.0

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Overarching Objectives

• Decrease emphasis on “rules” and increase emphasis on

process intent and thoughtful program planning

• Provide program structures and procedures tailored to the

dominant characteristics of the product being acquired and to unique program circumstances, e.g., risk and urgency

• Enhance the discussion of program management

responsibility and key supporting disciplines

• Institutionalize changes to statute and policy since the last

issuance of DoD Instruction 5000.02

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Statute & Policy Driving the Update

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Revised Document Structure

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Document Comparison

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What Has Really Changed

• The overall tone of the document—from compliance to thoughtful planning
• Example Program Models—tailored for the product being acquired and designed

to serve as benchmarks for structuring programs

• Re-written and Re-focused acquisition process procedures
• New/Expanded Policy:

−Program Management

−Program Protection, including Information Assurance −Intellectual Property −Operational Test and Evaluation (significantly expanded) −Life-Cycle Sustainment −Affordability −Defense Business Systems −Rapid Acquisition of Urgent Needs

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Tailored Applicability

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Product-Tailored Acquisition Models

• Model 1: Hardware Intensive Program
• Model 2: Defense Unique Software Intensive

Program

• Model 3: Incrementally Fielded Software Intensive

Program

• Hybrid Program A (Hardware Dominant)
• Hybrid Program B (Software Dominant)
• Model 4: Accelerated Acquisition Program

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13 14

Example 1 of 4

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Example 2 of 4

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Example 3 of 4

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Example 4 of 4

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Example Hybrid 1 of 2

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Example Hybrid 2 of 2

DAG revised 9 Oct 2012

DAG Changes

BBP

Better Buying Power

Better Buying Power (BBP) is based on the principle that continuous improvement is the best approach to improving the performance of the defense acquisition enterprise. The evolution from BBP 1.0 to BBP 2.0 was based on the premise that emphasis would shift as initiatives were put in place, experience was accumulated, data was collected and analyzed, and conditions changed. BBP 3.0 continues that approach with a shift in emphasis toward achieving dominant capabilities through innovation and technical excellence.

Better Buying Power 2.0 to 3.0 Overview

Overarching Principles

1. Think: The first responsibility of the Acquisition Workforce 2. People: Qualified people are essential to successful outcomes 3. Start with the basics: a) Effective incentives to industry b) Understand and actively manage technical risk c) Insist on demonstrated performance before major commitments d) Get the big, early decisions right e) Use the right contract type for the job 4. Streamline decisions: Streamline processes and oversight

The 5 7 8 Major Areas

BBP 1.0, 2.0, and 3.0

• 1. Achieve Affordable Programs
• 2. Achieve Dominant Capabilities While Controlling

Lifecycle Costs

• 3. Incentivize Productivity in Industry and

Government

• 4. Incentivize innovation in Industry and Government
• 5. Eliminate Unproductive Processes and

Bureaucracy:

• 6. Promote Effective Competition
• 7. Improve Tradecraft Acquisition of Services
• 8. Improve the Professionalism of the Total

Acquisition Workforce

Achieve Affordable Programs 1-1. Continue to set and enforce affordability caps

Achieve Dominant Capabilities While Controlling Lifecycle Costs

2-1. Strengthen and expand “should cost” base cost management 2-2. Build stronger partnerships between the acquisition, requirements and intelligence communities 2-3. Anticipate and plan for responsive and emerging threats 2-4. Institutionalize stronger DoD level Long Range R&D planning

Incentivize Productivity in industry and Government

3-1. Align profitability more tightly with Department goals 3-2. Employ appropriate contract types, but increase the use of incentive type contracts 3-3. Expand the superior supplier incentive program across DoD 3-4. Increase effective use of Performance-Based Logistics 3-5. Remove barriers to commercial technology utilization 3-6. Improve the return on investment in DoD laboratories Increase the productivity of IR&D and CR&D

Incentivize Innovation in Industry and Government

4-1. Increase the use of prototyping and experimentation 4-2. Emphasize technology insertion and refresh in program planning 4-3. Use Modular Open Systems Architecture to stimulate innovation 4-4. Increase the return on Small Business Innovation Research (SBIR) 4-5. Provide draft technical requirements to industry early and involve industry in funded concept definition to support requirements definition 4-6. Provide clear “best value” definitions so industry can propose and DoD can choose wisely

Eliminate Unproductive Processes and Bureaucracy

5-1. Emphasize Acquisition Executive, Program

Executive Officer, and Program Manager

responsibility, authority, and accountability 5-2. Reduce cycle times while ensuring sound investments 5-3. Streamline documentation requirements and staff reviews

Promote Effective Competition

6-1. Create and maintain competitive environments 6-2. Improve technology search and

• utreach in global markets

Improve Tradecraft in Acquisition of Services

7-1. Increase small business participation including through more effective use of market research 7-2. Strengthen contract management outside the normal acquisition chain 7-3. Improve requirements definition 7-4. Improve the effectiveness and productivity

• f contracted engineering and technical

services

Improve the Professionalism of the Total Acquisition Workforce

8-1.Establish higher standards for key leadership positions 8-2. Establish stronger professional qualification requirements for all acquisition specialties 8-3. Strengthen organic engineering capabilities 8-4. Ensure the DoD leadership for development programs is technically qualified to manage R&D activities 8-5. Improve our leader’s ability to understand and mitigate technical risk 8-6 Increase DoD support for Science, Technology, Engineering, and Mathematics (STEM) education

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Better Buying Power 3.0 DRAFT

Achieve Affordable Programs

• Continue to set and enforce affordability caps

Achieve Dominant Capabilities While Controlling Lifecycle Costs

• Strengthen and expand “should cost” based cost management
• Build stronger partnerships between the acquisition, requirements,

and intelligence communities

• Anticipate and plan for responsive and emerging threats
• Institutionalize stronger DoD level Long Range R&D Planning

Incentivize Productivity in Industry and Government

• Align profitability more tightly with Department goals
• Employ appropriate contract types, but increase the use of

incentive type contracts

• Expand the superior supplier incentive program across DoD
• Increase effective use of Performance-Based Logistics
• Remove barriers to commercial technology utilization
• Improve the return on investment in DoD laboratories
• Increase the productivity of IR&D and CR&D

Incentivize Innovation in Industry and Government

• Increase the use of prototyping and experimentation
• Emphasize technology insertion and refresh in program planning
• Use Modular Open Systems Architecture to stimulate innovation
• Increase the return on Small Business Innovation Research (SBIR)
• Provide draft technical requirements to industry early and involve

industry in funded concept definition to support requirements definition

• Provide clear “best value” definitions so industry can propose and

DoD can choose wisely Eliminate Unproductive Processes and Bureaucracy

• Emphasize Acquisition Executive, Program Executive

Officer, and Program Manager responsibility, authority, and accountability

• Reduce cycle times while ensuring sound investments
• Streamline documentation requirements and staff reviews

Promote Effective Competition

• Create and maintain competitive environments
• Improve technology search and outreach in global markets

Improve Tradecraft in Acquisition of Services

• Increase small business participation, including through

more effective use of market research

• Strengthen contract management outside the normal

acquisition chain

• Improve requirements definition
• Improve the effectiveness and productivity of contracted

engineering and technical services Improve the Professionalism of the Total Acquisition Workforce

• Establish higher standards for key leadership positions
• Establish stronger professional qualification requirements

for all acquisition specialties

• Strengthen organic engineering capabilities
• Ensure the DoD leadership for development programs is

technically qualified to manage R&D activities

• Improve our leaders’ ability to understand and mitigate

technical risk

• Increase DoD support for Science, Technology,

Engineering, and Mathematics (STEM) education

Achieving Dominant Capabilities through Technical Excellence and Innovation

Ideas retained from BBP 2.0 New in BBP 3.0

Continue Strengthening Our Culture of: Cost Consciousness, Professionalism, and Technical Excellence

19 Sep 14

Pre-Life Cycle

MSA TD EMD P&D O&S

Mission/Capability Portfolio

• Establish Economic

Production Rate Range MS A MS B MS C MDD CBA

• Affordability Target

Unit Acquisition Cost Annual Unit O&S Cost

AoA FRPD

SE trade-off analyses to define cost-effective design point. Focus on affordability of Design (unit acquisition cost & sustainment cost) Apply should-cost to control program overhead and unproductive expenses w/o sacrificing sound investment in product affordability Will-Cost—based on ICE/SCP/POE of affordable design—drives resource planning and budgeting. Apply Should-Cost to drive down all elements of program cost, including acquisition and sustainment costs of the product design. Actionable Cost Reduction Initiatives (CRIs) Should-Cost baseline drives program execution.

Affordability & Should-Cost

• Present SE Trade-offs
• Establish Affordability Requirement
• Will-Cost captured in APB/ADM
• MDA approved Should-Cost Baseline
• Program schedule justification/approval
• BCA to support tech data rights strategy

Affordability

• Affordability will continue to be a

design constraint

• Anticipated future budget will be the

basis for the constraint.

• Affordability analysis submitted at

milestone reviews

• “If caps are breached, costs must be

reduced or else program cancelation can be expected.”

Open Systems Architecture (OSA)

The modular open system approach (MOSA) is an integrated business and technical strategy to:

• Choose commercially supported specifications and standards

for selected system interfaces (external, internal, functional and physical), products, practices and tools, and,

• Build systems based on modular hardware and software

design.

• Open System Architecture allows components modified and

supported by different vendors throughout the life-cycle and drives opportunities for enhanced competition and innovation.

• Open System Approach is key component of a sound Technical

Data Strategy.

DOT&E Responsibilities

• Prescribe DoD OT&E and LFT&E policy.
• Provide guidance on all OT&E and LFT&E matters
• Monitor & review all OT&E and LFT&E in DoD.
• Report annually to Congress on OT&E and LFT&E.
• Member of Defense Acquisition Board and Info Tech

Acquisition Board.

• Approve test plans for OT & LF oversight programs.
• Report on programs, before full-rate production

decision:

– Adequacy of OT&E & LFT&E. – Operational effectiveness & operational suitability. – Survivability and lethality. – To Secretary, OSD, Services, & four congressional committees.

http://www.dote.osd.mil/about/respon.html

Amplifying Enclosures

Back Up

FY12 National Defense Authorization Act (NDAA) Section 835 Management of DT&E for MDAPs Statutory Changes FY12 NDAA, Sec. 835 – DT&E

Each Major Defense Acquisition Program (MDAP) and MAIS must have: 1. A chief developmental tester, responsible for:

– Oversight of all DT&E activities – Maintaining insight into contractor activities – Helping PMs make good judgments concerning contractor DT&E results

2. A governmental test agency serving as lead DT&E

• rganization for the program, responsible for:

– Providing technical expertise to the chief developmental tester – Conducting DT&E activities as directed by the chief developmental tester – Assisting in providing contractor oversight, and making good judgments concerning contractor DT&E results

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DOT&E/USD (AT&L) Memo Test and Evaluation of Defense Programs 3 June 2011

Jun, 2011 DOT&E/USD(AT&L) Memo - Test and Evaluation of Defense Programs

• What was found

– DAE assessment team "found no significant evidence that the testing community typically drives unplanned requirements, cost or schedule into programs.“ – The DOT&E review examined 40 programs that experienced significant delays during the past few years and found that 7

• f those programs experienced some delays due to testing

itself. – In 37 programs, there were delays caused by problems discovered during testing. – Problems found by testing were shown to cause much longer delays than any delay caused by testing itself

Jun, 2011 DOT&E/USD(AT&L) Memo - Test and Evaluation of Defense Programs

• What is needed

– Rapid adaptation to emerging facts by the requirements, acquisition, and test communities and less resistance to change – Well-defined, and therefore testable, requirements – Properly aligned acquisition strategies with T&E strategies and test plans that are both rigorous and efficient and that account for realworld constraints and expectations – Better communications between communities

USD(AT&L) Memo 21 Mar 2011

• PMs shall formulate a comprehensive reliability and

maintainability (R&M) program using an appropriate reliability growth strategy to improve R&M performance until R&M requirements are satisfied.

• Program shall include:

– R&M Allocations – Reliability Block Diagrams and predictions – Failure Definition and Scoring Criteria (FDSC) – Failure Mode Effects and Criticality Analysis (FMECA) – Maintainability and Built-in Test Demo – Reliability Growth Testing at system and subsystem levels – Failure Reporting And Corrective Action System (FRACAS)

https://acc.dau.mil/adl/en-US/457641/file/58840/USD-ATLMemo-DTM-11-003- Reliability-21Mar11.pdf

USD(AT&L) Memo 21 Mar 2011

• Lead service or PM prepares RAM cost rationale report in

support of MS A

• TDS @ MS A and ACQ Strategy @ MS B/C shall explain how

warfighter R&M requirements have been translated into R&M design requirements and contract specifications.

• Reliability Growth curves included in SEP at MS A and updated

in TEMP at MS B/C

• Reliability Growth assessed at IOT&E
• PMs shall address Reliability Growth at Tech reviews, program

support reviews and in support of the Defense Acquisition Executive System (DAES) reviews.