Wednesday, April 23, 2014

The INSIDER - April 17, 2014

Posted on InsideDefense.com: April 17, 2014 -- UPDATED 5:00 p.m.
Selected Acquisition Reports.

Just posted:

DOD's December 2013 Selected Acquisition Report Summary

On April 17, 2014, the Defense Department released "details on major defense acquisition program cost, schedule, and performance changes since the December 2012 reporting period. This information is based on the Selected Acquisition Reports (SARs) submitted to the Congress for the December 2013 reporting period."

The Business Of Defense.

Inside the Pentagon's top story this morning is on DOD's business enterprise architecture:

DOD Seeks To Simplify Business Enterprise Architecture, Mature Framework

The Pentagon is poised to begin to simplify its business enterprise architecture and weigh the possibility of shifting its management to the office of the chief information officer, a senior official states in a new report to Congress.

In his March report, acting Deputy Chief Management Officer Kevin Scheid told lawmakers the department intends to evolve its business enterprise architecture, which provides a plan for the department's business transformation with an eye on its priorities and the capabilities needed to support them. The Defense Department is also working to mature its integrated business framework, a management model and process intended to improve business services for the warfighters as well as align strategy and spending, according to the report.

The integrated business framework was developed in response to the fiscal year 2012 Defense Authorization Act.

"In order to enable DOD stakeholders to understand, review and analyze the business strategy and plans, the [integrated business framework] will provide the foundation to link authoritative data with business processes, initiatives, goals and outcomes," Scheid wrote. This will help the department better determine defense business system investments, he added.

Document: DOD Report To Congress On Defense Business Operations

Looking at Logistics.

Lots of news on logistics:

Air Force Looking To Navy For Performance-Based Logistics Management Tips

The Air Force still has some room to improve its understanding and management of performance-based logistics contracts, according to one of its senior contracting officials, which is why the service is looking to the Navy for lessons on how it might develop better cost insights and efficiencies in PBL deals.

As part of a larger push to improve efficiency in the acquisition world, known as Better Buying Power 2.0, the Defense Department has been advocating for the greater use of performance-based logistics contracts. Under this type of sustainment contract, the government provides a company with a long-term, fixed-price deal and a set of very specific performance goals. Maj. Gen. Wendy Masiello, the Air Force's deputy assistant secretary for contracting, said on April 16 that the service has held back on its use of PBL arrangements largely because it is still learning how to best use them.

"There is still not a good understanding of how the PBL operates and whether we're really getting a good deal," Masiello said during an Air Force Association event. "It might be less than what we expected to pay but we don't have the confidence yet. I think that's one of the reasons we are hesitant to just go full into it -- they are kind of a fixed-price deal with no cost insight."

While a PBL deal does not lend itself to deep cost insights, there are ways to approach the contracting vehicle that could help the service make better use of the tool, Masiello said. She pointed to the Navy's PBL agreements for programs like the V-22 as good examples of how to leverage fixed-price contracts in ways that benefits both the customer and the government.

Kendall: DOD Expects Uptick In Performance-Based Logistics Contracts

The Pentagon expects to see an uptick in the usage of performance-based logistics contracts, which the department has been emphasizing as a way to reduce equipment upkeep costs, Defense Department acquisition chief Frank Kendall said this week.

Speaking Tuesday at a logistics forum hosted by the National Defense Industrial Association, Kendall said DOD intends to continue to emphasize PBL contracts as it looks to reduce cost and improve support performance.

PBL contracts specify a level of performance at which a weapon system must be maintained at a fixed cost to the government. A contractor, ideally equipped with a long-term deal, then figures out how to achieve that performance, all the while trying to streamline its own business processes to maximize profits.

The department released guidance in November 2013 to help officials adopt and expand the use of these contracts for military programs. The guidance, signed by Paul Peters, acting assistant secretary of defense for logistics and materiel readiness, states effective PBL arrangements have "incentives to achieve required outcomes and cost reduction initiatives" and "a manageable number of metrics linked to contract requirements that reflect desired warfighter outcomes and cost-reduction goals."

AFRICOM Refines Logistics Plan With Industry, Multinational Input

The head of U.S. Africa Command's logistics directorate is reaching out to industry and foreign partners to "optimize and synchronize" the Defense Department's logistics network in continental Africa.

On Tuesday, Brig. Gen. James Johnson, AFRICOM's director for logistics, told industry representatives at a National Defense Industrial Association-sponsored forum in Washington that the command is working to complete a theater distribution plan that leverages existing partner and industry assets to improve the flow of supplies to meet the needs of Defense Department operators in Africa.

The J4 logistics directorate held an AFRICOM "theater distribution synchronization forum" in October, Johnson said, which involved logistics officials from allied nations including the United Kingdom and France, as well as representatives from the European Union, the African Union, the Joint Staff and the Office of the Secretary of Defense.

He said the meeting provided a chance to lay out a map of AFRICOM lines of operation and to determine what other cooperative assets, including transport equipment and storage facilities, could be leveraged to improve the flow of supplies.

DLA Looks At Ways To Save Money, Deal With A Smaller Budget

Defense Logistics Agency Director Vice Adm. Mark Harnitchek this week outlined changing plans for the agency, citing a need to dramatically reduce contract award times and supply inventories.

DLA hopes to cut the time taken to award contracts by 70 percent. "The input we got from industry is it takes us too long to award contracts, and when it takes too long to do things, you have a lot of inventory, you have a lot of cost and the forecast you have to give to industry is usually stale," Harnitchek said at an April 15 event held by the National Defense Industrial Association in Washington, D.C.

The director added that he does not want any contract to take more than a year to be awarded. "I told my folks it's OK to take about a year on a $10 billion contract, but for everything else I want it flying out of there," he said. Harnitchek also said contractors must make products faster.

VIP Flight.

The Air Force has a draft RFP out for maintaining its VIP aircraft:

Document: Air Force's VIP Aircraft Sustainment Draft RFP Package

Our coverage:

Air Force Issues New Draft Solicitation For Delayed VIP Airlift Competition

The Air Force has released a new set of draft bidding documents for a competition to sustain two fleets of VIP airlift aircraft -- an acquisition program the service has already pushed back by at least a year to give it time to prepare a better request for proposals.

The aircraft in question are the C-32 and C-40, both of which are derivatives of Boeing commercial airframes; they are used to transport senior military and civilian government officials. Boeing is the prime sustainment contractor today, and the Air Force is looking for logistics support for 15 total aircraft.

As Inside the Pentagon reported in January, the service decided to delay an acquisition effort by 12 to 18 months so it could rewrite a solicitation to industry based on a better understanding of the market for contractor logistics support (CLS) of large, commercial-derivative aircraft. On April 9, the Air Force posted a new draft RFP on the Federal Business Opportunities website, and it is accepting industry comments until April 23.

The revised solicitation includes some of the most critical documents in an RFP: the performance work statement, a pricing matrix and a document spelling out how bidders will be evaluated. The Air Force hopes to be able to compete sustainment work for the C-32 and C-40 rather than sole-sourcing those activities to Boeing because even if Boeing ends up winning a competition, it is likely to do so on more favorable terms to the military if it is forced to compete for the work.

Missile Defense.

A new GAO report on missile defense is out:

Document: GAO Report On European BMD

Our story:

GAO: Lack Of Planning Could Cause Problems For European Missile Defense

A lack of planning for the deployment of initial missile defense systems through the European Phased Adaptive Approach has led to implementation issues and could compromise future capabilities, the Government Accountability Office states in a new report.

"Without identifying and planning to resolve implementation issues before deployment, the Defense Department risks continuing to encounter implementation issues after it employs additional [ballistic missile defense] capabilities in Europe, which may lead to significant delays and inefficiencies," the April 11 report states.

The EPAA is a phased missile defense program created to intercept hostile or rogue missiles targeted at Europe, with Iran a prime concern. An administration deadline for Phase One capabilities was met in December 2011. However, DOD's planning lapses led to incomplete infrastructure for soldiers arriving at the forward-based radar site in Turkey, GAO stated. According to the report, housing and dining facilities were incomplete for soldiers' arrival.

"As a result, Army officials state that soldiers arrived at the remote mountain-top radar site in windy conditions and their tent-based expeditionary facilities were unable to withstand the conditions," the report stated.

Odds & Ends.

Some new documents:

CRS Report On DOD's 'Section 1206' Security Assistance Program

The April 4, 2014, Congressional Research Service report -- originally obtained by Secrecy News -- discusses background and issues for lawmakers regarding the Defense Department's "Section 1206" security assistance program.

GAO Report On The Army's Modular Force Structure

The April 16, 2014, Government Accountability Office report finds that the Army still faces "challenges in estimating costs and assessing capability" regarding the service's annual modular force structure analysis.

GAO Report On DOD Contracting

The April 16, 2014, Government Accountability Office report looks at the Defense Department's "use of class justifications for sole-source contracts."

Army Regulation On Program Protection

The April 7, 2014, Army regulation "assigns responsibilities and prescribes policies for developing plans to protect critical program information (CPI), conducting supply-chain risk management (SCRM), and performing damaging assessment activities resulting from a compromise of unclassified program information."

DOD Instruction On International Transfer Of Technology, Articles, And Services

The March 27, 2014, Defense Department instruction "establishes DOD policy, assigns responsibilities, and prescribes procedures for the international transfer of dual-use and defense-related technology, articles, and services, and directs the use of a DOD automated export license system."

DOD Directive On Electronic Warfare Policy

The March 26, 2014, Defense Department directive updates "EW policy, definitions, and responsibilities within the DOD for providing operational forces with EW capabilities to control the electromagnetic operational environment (EMOE) across the range of military operations."

-- John Liang

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