According to recent guidance from Frank Kendall, undersecretary of defense for acquisition, technology and logistics, the initial round of Better Buying Power did not go well due to acquisition workforce personnel “creating” mandates from guidance on improving performance.
One of the biggest areas of “confusion” from the original guidance was the preference for more fixed-price contracts. However, that guidance turned into a mandate to create fixed-price contracts period, regardless of requirements or risk. The outcomes are obvious in waste and mismanagement, and will continue for years to come.
Combined with the “mandate” for low-cost, even with “best value” awards where awardees are seemingly stripped of winning bids to create a low-cost solution, there is a culture currently at the Pentagon where contract awards, and contract management itself, is in a state of disrepair.
This latest round of guidance includes a long list of items to tackle, but according to Kendall, “thinking” is the most critical item.
…”There’s a flavor that runs through it that says, ‘Here are the tools you need, and here’s the way you should be thinking about the problems you have to solve. But you have to solve them,’” he said. “You have to be professional and really understand what needs to be done.”…
Kendall further went on to say in a roundtable session with reporters discussing the memo:
…”People have to know the right thing to do, and they have to have a system that supports them in doing it”…
…”The [fixed price incentive fee item] was good guidance, but there’s a tendency in our system to say, ‘OK, that’s what they want us to do, so that’s all we’ll do now because that’s going to get whatever we want to do approved.’ So we’ve modified that. Now it tells people to use the right contract type for the job. That means there’s a burden on our professionals to figure out what that is, but we’ll give them guidance.”…
Incentivizing productivity in the defense sector? We can’t even select the correct contract type. Further, the frustration with the defense contracting process and the workforce has been an increasingly sore spot that is leaving firms behind, especially small businesses, which is decimating the defense industrial base.
Not surprisingly, the focus on Mr. Kendall’s remarks came down to improving the skills of the defense acquisition workforce, in a time where budget cuts continue to eat into opportunities for training and skill-building for those responsible for awarding billions of taxpayer funds.
“We’ve brought a lot of junior people in, and they need to be developed. We’ve got a bathtub in terms of demographics. We have a lot of older people who are going to be retiring, and we need to make sure those people’s knowledge is retained as much as possible as they go out the door. All of the services and components are working on this together.”
Somewhat curious in the memo includes several steps seemingly designed to reduce bureaucracy, although his comments seemingly seem to support the bureaucracy through affirmation of the “Chain of Command”?
People are encouraged to “think,” but nonetheless have to report to a leadership structure that is top-heavy with overhead, processes that are overly cumbersome, especially with IT buys, and Defense Acquisition University programs that need to be rethought to allow the competence and skill-set to match the level of training needed as opposed to the current system of checking of boxes for certification.
Also of note is the desire to make saving money acceptable in the use-it it lose-it mentality, and the desire to open dialogues with industry in a “closed-door” mentality of market research also seems a difficult barrier to overcome.
I fully support Mr. Kendall’s effort to simply defense contracting processes, as there is no question that the maze that is the Defense (DoD) 5000 process is challenging enough, without adding budget cuts, sequestration, and difficulties with the workforce.
An uphill struggle for Mr. Kendall, to say the least.
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