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Tuesday, January 22, 2013

Defense Acquisitions: How DOD Acquires Weapon Systems and Recent Efforts to Reform the Process

Moshe Schwartz
Specialist in Defense Acquisition

The Department of Defense (DOD) acquires goods and services from contractors, federal arsenals, and shipyards to support military operations. Acquisition is a broad term that applies to more than just the purchase of an item or service; the acquisition process encompasses the design, engineering, construction, testing, deployment, sustainment, and disposal of weapons or related items purchased from a contractor.

As set forth by statute and regulation, from concept to deployment, a weapon system must go through a three-step process of identifying a required (needed) weapon system, establishing a budget, and acquiring the system. These three steps are organized as

  1. The Joint Capabilities Integration and Development System (JCIDS)—for identifying requirements, 
  2. The Planning, Programming, Budgeting, and Execution System (PPBE)—for allocating resources and budgeting, and 
  3. The Defense Acquisition System (DAS)—for developing and/or buying the item. 

Step three, the Defense Acquisition System, uses “milestones” to oversee and mange acquisition programs. At each milestone, a program must meet specific statutory and regulatory requirements before the program can proceed to the next phase of the acquisition process. There are three milestones:

  • Milestone A—initiates technology development, 
  • Milestone B—initiates engineering and manufacturing development, and 
  • Milestone C—initiates production and deployment. 

Both Congress and DOD have been active in trying to improve defense acquisitions. A comprehensive legislative effort to improve weapon system acquisition occurred in May 2009, when Congress passed and the President signed into law the Weapon Systems Acquisition Reform Act of 2009 (S. 454/P.L. 111-23). Key provisions in the act include appointment of a Director of Cost Assessment and Program Evaluation within DOD to establish guidance on cost estimating; appointment of a Director of Developmental Test and Evaluation to develop polices and guidance for conducting developmental testing and evaluation; appointment of a Director of Systems Engineering to develop policies and guidance for the use of systems engineering; and a requirement that the Director of Defense Research and Engineering periodically assess technological maturity of Major Defense Acquisition Programs.

One of DOD’s main efforts to improve acquisitions is the better buying power initiative. In 2010, DOD issued a memorandum Better Buying Power: Guidance for Obtaining Greater Efficiency and Productivity in Defense Spending. In November 2012, DOD launched the "Better Buying Power 2.0" initiative, an update to the original effort. The update included some modifications of the original memorandum. For example, the original effort called for increased use of fixed-price contracts; the new version emphasizes the use of an appropriate contract type, depending on the circumstances. Perhaps the most significant change is the added emphasis on improving and professionalizing the acquisition workforce.

Date of Report: January 2, 2013
Number of Pages: 20
Order Number: RL34026
Price: $29.95

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