Attached is the first annual report on the Performance of the Defense Acquisition System. I have been talking about producing this report for well over a year now and I am happy to finally be able to release the inaugural edition. The report will be expanded upon and updated each year. It represents the beginning of an effort to assess how well we are doing at delivering products to our warfighters, how our performance is changing over time, and, most importantly, to begin to better understand how we can improve that performance.
This report focuses on a subset of the work done in the broad acquisition system— the major programs—and it focuses on our ability to execute programs within cost and schedule baselines during development and early production. Admittedly, this is just a fraction of the work we do, and future reports will expand on this data—but this is the most visible and frequently criticized area of our performance, so it is a good place to start. There also is a fairly wide array of data available on these programs.
Among other things, the report covers performance differences among the Military Departments, buying commands, and major primes. The first thing I expect most readers to do will be to look up their own institutions to see how well they are doing in comparison to others. Good. Go right ahead. Whatever your institution’s relative performance, I can assure you there is room for improvement. We have attempted to make a number of correlations in the report. Some of the results are likely to surprise you. Many of the items we have focused on over the years do not correlate strongly to the outcomes measured here; our conventional wisdom about defense acquisition isn’t always correct.
The purpose of this report, in part, is to use the data “as is” to help us critically think about and better understand our performance and the actions we can take to improve our organizations’ performance. For that reason, the approach taken is to present the data without a great deal of discussion. The report does raise a number of questions about why we are seeing the results portrayed here and provides some insight on what we can do to affect those results. In a few years, I hope to see some of the trends shown here improving as we focus on emulating the best practices that this data can help us identify.
We shouldn’t lose sight of the fact that we provide our warfighters with the best equipment in the world, but we also can’t avoid the fact that we should be able to achieve this goal faster and cheaper. Let me call your attention to one piece of data in the report—the summary of the Program Assessment and Root Cause Analysis Office’s reviews of Nunn McCurdy cost breaches over the last few years found on Page 34. Far and away the most significant factor in these large overruns is poor management performance. We can do better, and this report is a tool to help us achieve that end as all of us involved in defense acquisition, in government and in industry, work to continuously improve the outcomes we achieve.
Frank Kendall
Under Secretary of Defense
Acquisition, Technology & Logistics
