 Well, thank you everyone for coming this morning and to a discussion about acquisition reform, defense acquisition reform, the most perennial and popular topic in Washington, D.C., at least in defense circles, at least in my way of thinking. And the idea today is to really get after what are the fundamental ideas that undergird the acquisition system and the way that it's managed, the foundational text for which, if you will, is sort of the Packard Commission report from the 1980s, more formally known as the President's Blue Ribbon Panel on Defense Management, and some of the proposals that have been made to actually alter that way of managing the system in recent legislation and try and get after what the roles and responsibilities in the system really are and what ought they to be, and maybe that'll lead to some thoughts about where some of the legislation could go or should end up. So let me just briefly talk a little bit about what happened with the Packard Commission. I'm at some risk here because we have an actual expert at the table who was there in the discussions and negotiations and actually testified to Congress about the Packard Commission findings. I brought a copy of the Bible too. A signed copy, signed by David Packard himself, so in an original version. And then a little bit about what I think are the main issues that Packard spoke to that are under debate today and a little bit about what some of the proposals are to change it. And then we'll turn it over to our illustrious panel to talk about their direct experience actually working these issues in the process. And I should begin by saying that this panel was put together not out of any desire to come to a specific conclusion or outcome of this conversation, but because all three of these gentlemen have direct experience actually making the system work and understanding how it should work, does work, maybe doesn't work as the case may be in various instances. And so that's really the goal for today is not to come to necessarily a specific conclusion but to just hear from people who understand how the system does, can, and should work. So let me begin by talking a little bit about the Packard Commission and it's really an amazing document if you haven't read it, it's worth going back or if you haven't read it for a while it's worth going back and reading again. And has been as is noted and almost obligatory to note in almost every discussion of acquisition reform of course there were studies before and after the Packard Commission, many of which have had findings that are the same as similar to or identical to the Packard Commission finding. So it's not necessarily a revolutionary document in that sense, but it does to my mind capture the essence of the basic thinking of what defense acquisition should be in a very clear, understandable, and pure form. And for the purposes of today's discussion there were really two big focuses or I should say foci but of the Packard Commission recommendations. Many more recommendations than the Commission report that are incredibly important and worthwhile. But the focus for today, two things that the Packard Commission recommended that were subsequently enacted its statute that are currently being re-looked at. The first was establishing that the person in charge of the acquisition system was the undersecretary, well was the secretary of defense, and the action arm for the secretary being under secretary of defense for at the time acquisition, now acquisition technology and logistics. And that was not clear in either practice or in statute prior to the Packard Commission report. To put the secretary of defense directly in charge of the department's acquisition. Of course the department of defense is in historical terms a relatively recent add on to what was previously the military departments, the department of war and the department of the Navy. And so really a lot of the foundational statutes and all of the foundational policies that the department resided at the service level. And it was really the Packard Commission recommendation subsequently enacted that said this is the secretary's job, secretary defense's job. The second major thing for purposes of today's discussion was spelling out a acquisition chain of command that began with the defense acquisition executive, the undersecretary, and then there was a service acquisition executive position which was not at the time of the Packard Commission report nearly as clear or as strong a role as Packard recommended. And then to a program executive officer to a program manager with the idea of being that the program manager be empowered to actually manage the program. A question of the success of program managers being given that authority, of course, itself a matter of debate. But this clear acquisition chain of command did not explicitly include the service chiefs, which previously potentially that was the service, seen as a service chief's role to be the commander or to be the chain of command for the program manager. And Packard recommended obviously the chain that we have today statutorily, which makes it, I would say, at a minimum unclear how the program manager relates to the service chief in the system. And there is obviously part of the efforts in the two major defense bills that are currently being conferenced to look at that issue. And in practice, service chiefs control the requirements process very explicitly and they control the budget process on an annual basis in cooperation with or in combination with the civilian establishment and the services and with OSD. But that acquisition piece, because the explicit chain of command didn't involve the service chiefs, it was much less clear how their authority would play in that scenario. So turning then to today's legislation that's under debate, again, much like the Packard Commission report, there is over 100 acquisition related provisions in the two defense authorization bills, many of which have tremendous impact. But for purposes of today's discussion, I'm going to focus on those that deal in this question of milestone decision authority and the roles and responsibilities of OSD versus the services versus the service chiefs in their roles. And in particular, there are some big changes that have been proposed. To my mind, possibly the most impactful over the long term, it would be to reassign milestone decision authority, which today resides with at the discretion of the secretary to assign. And in most cases for major defense acquisition programs is with the Under Secretary of Defense for acquisition, but which is not infrequently delegated to service acquisition executives, but retaining that chain of command, if you will, from the defense acquisition executive and changing it to be explicitly from for the biggest programs for major defense acquisition programs to be the service acquisition executive as the milestone decision authority. And with with additional language that says that anyone outside the service essentially can only look at the program's data and documentation. If the service voluntarily provides it, then no one else is allowed to require the service to provide that data other than where it's specifically statutorily mandated for things like operational test and potentially things like the selected acquisition reports. And so it also the Senate legislation in particular would enhance the role of the service chiefs to make to assign them a specific role to coordinate requirements, budgets and acquisition together and to play in the milestone process in that coordination role. And a third change that I think is maybe a little harder to understand exactly what it would do, but I think could be quite important is it statutorily assigns the services as the customer of the acquisition process. And that seems to me to be a bit of a departure from the past where in many cases those of us in the policy community have kind of looked at the warfighter as a customer of the acquisition process. And that's that's potentially an important change, although it's less clear exactly what that would would do, practically speaking. And then just as a last kind of introductory or frame setting topic, let me talk a little bit about what this milestone decision authority is actually about. Because it seems to me and I've written about this that from a congressional perspective, when you look at acquisition, the role of the milestone decision authority, the role of the PEO, the role of the program manager, don't necessarily jump out as being wildly different from one another, because from a congressional perspective, they're responsible for oversight of all of these efforts. But the role is not the same. The role of the milestone decision authority is to make critical decisions on committing to major investments. In the case of milestone defense acquisition programs, we're talking many billions of dollars over decades of time. So they're major commitments of resources that that the services and as it stands today, the Secretary of Defense are jointly making these investment decisions and these commitments. And it's about laying out the acquisition strategy for the program, which again is not a one year plan. It is a multi year many case multi decade plan for how a system is going to proceed. And that is a that is a distinct activity related to but a distinct activity from the day to day management of a program that a program manager undertakes. And in many cases, the decisions that the milestone decision authority is making can be thought of and I have heard it spoken of by many program managers as a contract between the milestone decision authority, the executive and the program manager who's undertaking the program. What what it is that the program manager is being tasked to do and to achieve over the life of the program and for the term of their service on it. So with with a few remarks there to try and set the debate about when we talk about rethinking the Packard Commission approach, at least in Andrew Hunter's opinion, what do we what are we really talking about today that that's I think the grist for the mill for today's discussion. There's there's so tremendous amount of important things that Packard recommended and that the various defense bills are proposing, but I'm hoping that when we leave here today we will have wrestled with with those issues about the roles and responsibilities in this system for those major investment decisions. And with that, let me talk a little bit about our panel. Actually, I'm pleased to say I think no one on this table other than myself really requires introduction, but I will introduce them anyway. To my right and and and who's going to be the next speaker is Alan Estavez, who is a principal deputy under Secretary of Defense for acquisition technology and logistics is a now obviously a senior presidentially appointed leader in the acquisition system, but was also a career civil servant of the highest distinction and highest order in I think originally in the army. Is that correct? Many years ago and then for quite a bit of time and also in the office of Secretary of Defense and the logistics sphere and now with the broader 18 L mandate to his right is General John Jumper, former chief of staff of the Air Force and a former industry executive of great distinction, who I would say during his time as chief was was extremely active and a very to my personal opinion, very productive way in the acquisition process and I think notably so among service chiefs who have have served in the last 20 years and kind of the Packard Commission era, if you will, and can speak, I think will speak quite knowledgably about what those roles and responsibilities need to look like. And then to his right Dr. Jack Gansler, who's had many roles and currently important leader at the University of Maryland and the School of Public Policy former Under Secretary of Defense for acquisition technology and logistics and a former staff member to the Packard Commission itself. So we will after after our panelists have had a chance to say give some remarks and after we've had a little bit of discussion, we'll open up to audience questions because I know looking out in the audience, we have quite a few experts in the audience as well. So we wanted to expand the dialogue to you. With that, let me turn it over to Alan. Alan, if you could give us some of your thoughts. Thank you, Andrew. Just for starters, let me note that I rushed over here from my warfighter SIG, where the just in case you missed your previous life, where the system is, and I see you out there, another veteran CR of warfighter SIG, where the system is ably, rapidly fielding capabilities to both our warfighters and to our coalition warfighters for both the ISIL fight and against the Taliban in Afghanistan. So let me give a couple of thoughts. Talking about the Packard Commission with Jack Gansler sitting on the panel is a risky proposition for me, but I did have Dave Briteau school me up a little bit before I came over here, who was also a veteran of that commission. So if you look at the Packard Commission, you say what was its fundamental, what was it fundamentally trying to drive in the acquisition area? First it said that requirements, you need to establish definitive requirements and then you need to ensure that there's adequate resources to fulfill whatever you're buying against that. Second you needed to ensure that there was competent professionals doing that and then third you need to align responsibility. So I'd say that Packard got it right. It was right then and it's right now. The trick is implementing those concepts and of course that varies over time. So sometimes we do it well and sometimes we do it not so well, but we're always striving to do it well. Next, you know, so I'd be a strict construction if you wanted to talk, you know, the way Packard laid that out. Next I'm going to frame this discussion in a little bit the way that you framed it in an article that you put out Andrew. So is the acquisition system totally broken or does it do some things well? And if your metric is do we field the best equipment in the world? Do our war fighters want our stuff? The answer is yes. Could we do it better? Could we do it faster? Could we do it cheaper? The answer is probably yes there too, but but we are pushing technological edge here for military capability. So it's not just a slam dunk out there that you can legislate that I can do something in five years. Sometimes you can't. You know industry doesn't do it either, frankly, in the commercial sector for big, complex, major systems. You know I'll use a seven, eight, seven taro. You know, it's hard to field big complex systems to go out and go against enemies or potential adversaries who are also fielding big complex systems and for us trying to stay at least one step at least one step ahead of them. So from that perspective the system does produce but I'd also submit that it can do better. So we are for acquisition reform. In fact if you look at the bills that are produced by the House and Senate today, we agree with most of the provisions. We have some concerns with a few of the provisions and we provided those feedback both to the House and Senate. Obviously Section 843, the provision that changes milestone decision authority, we have major concerns with, but let's not wrap get wrapped just on that one provision. If you look at the whole structure of those bills there's a lot of goodness there, including a legislative proposal that we sent over that included six or seven provisions, seven provisions, frankly Andrew helped write in his time in the building and most of those are adapted in the Senator House bill, sometimes both or in one or the other. Only one provision was not incorporated at all. So from that perspective we are all for acquisition reform, we're all for looking at the process and trying to make the process better. Inside the department we've been doing that under better buying power, through all its iterations now when it's third iteration and we think that we're making progress there, frankly. The problem if you look at things in the acquisition system, there's a long flow out of what you did today, you don't see the result of that for years, sometimes many years, sometimes sooner than that. But if you look at the things that we're doing with affordability caps, should cost savings which are been embraced by the services, trying to drive realistic requirements and going back to Packard, trying to ensure competition even in sole source situations, ensuring that we're putting out the right contract guidance and using the right contract type and training our program managers to make that selection, putting out the performance reports that my boss Frank Kendall is we're about to release our third iteration in a couple of weeks and then looking at the bureaucracy, all those things are goodness and all those things we believe are leading to better results. In fact some preliminary data that we have that should come out in the performance report that's about to come out. If you look at programs that are showing negative cost growth, in RDT&E right now since 2009 57 percent of our programs are showing negative cost growth in the RDT&E line. That's as opposed to 17 percent in the 2008 to 2000 to 2008 timeframe and 9 percent in the 1982 to 2008 timeframe. For procurement costs, for unit cost, again we're showing 79 percent of our programs are showing negative cost growth as opposed to 44 percent in the 2000 to 2008 and 33 percent of the period before that. Those are significant numbers. Again you try to track back the correlation, always difficult programs started different times, but the trend is positive there and so we're going to continue pressing the things that we're doing under better buying power. Again looking at the big acquisition reform picture we agree service chiefs involvement is critical. They need to drive the requirement, they certainly drive the budget, they certainly need to pick the right people inside their service that are driving the programs, so that's an important part. We agree we need to be looking out to non-traditional defense providers, which isn't to say that traditional defense providers are not providing us some great pieces of equipment, but we need to look big obviously we're standing up some capability out in Silicon Valley, it's not just about Silicon Valley, it's about tech across the the United States and the globe for that matter because it is a global environment, but if you look at things like big data or cyber or autonomy or robotics, those are areas that the non-traditional environment is producing some great results, visualization, man-machine interface, those are things we need to embrace and we need to work with our traditional industry as well as with our own labs and our own R&D environment to figure out where the best reach is there, and the bills provide us some encouragement and some capabilities to do that, so we're all for that. On the need to streamline bureaucracy, we are all for that too. We've made some proposals that we're going to implement that we can implement without the Hill related to industry, we've been working with industry on those things, and some of the other areas that the Hill has produced that we put forward that, you know, burden that we're putting on our program managers that we believe is non-value add, they've embraced most of that, we like it, that's good. On the workforce, you know, DOTF has been a boom, we need to continue that, we need to continue to grow and train our workforce, that's the future. Implementing strong programs comes from the people who do it, so A43, the problem with A43 for us gets to, one, we believe it impedes the secretary's ability to manage the department. The reality is the secretary manages the department through the OSD staff, not through the service staff. When you say that you cannot provide data to the acquisition executive inside the, you know, to the undersecretary 18L, they're impeding these secretary's ability to manage programs. These are big multi-trillion dollar decisions in some cases. I'm not sure what you're going to say, General Jumper, but when you were running LIDOS, I bet you wanted to be involved in major decisions that impacted your bottom line. Well, so do we. So there's ways to do that, we're working, we've provided our feedback to both the Senate and House on the bill. Second, we believe that there's goodness in a corporate view and that comes from the USD18L. And then again, you know, we'll work through, we've been working through with the committees on how best to do that. The reality is, in times of tight money, the services try to cram more into their program. It's just a natural tendency that may be feasible. I've never been in a meeting where the service said, oh, I will fund to the ICE instead of the service cost position. Again, it's just a natural tendency not to want to do that. And in times of tight money, like we are in, you're trying to buy more than the program may allow. And getting a corporate view helps do that. So that's our concerns with that one section. But again, I'd go back and say that overall we're for most of the provisions in both those bills and we've been working very tightly with both the House and Senate to ensure that we get the right bill that comes out. And we're looking forward to that. With that, I look forward to our dialogue. Well, thank you, Alan. Let me turn now to General Jumper, who can give us both an industry service chief and just a very informed and intelligent perspective. Thank you, Andrew. And thank you, Alan. And I'll take drama out of this right now. I agree with you. Okay, so from a service chief's perspective, what you want to see is the uniform services involved in the process. And I just basically disagree with anything that says you're going to automatically exclude people in a process when inclusion is absolutely necessary to the success of these large programs, as Alan described. So I'm going to take my time today. And by the way, nobody gets it any better than Frank Kendall, as far as I'm concerned. His better buying power one, two, and three, I think, and his efforts to bring senior people together in industry, as well as in uniform, I think has been exemplary for a guy as busy as he is. He takes personal interest in this. And it harkens back to the day when I was a major in the basement of the Pentagon, and I would wander up to the fourth floor from time to time. And it was not unusual to see Norm Augustine walking the halls of the Pentagon. It was not unusual to see Jack Welsh walking the halls of the Pentagon. And what were they doing? They were walking into the Secretary of Defense's office, or the Chief of Staff of the Air Force, or the Chief of Naval Operations, and they were working the real-time problems of the moment. And it gets to one of the points you made, Alan, about communication. Both as a service chief and as a CEO, when I walked in to try to have that frank conversation that I knew used to take place, where you didn't necessarily remain polite, when you have big problems that really deserve a little bit of juice in the conversation. You were there in those days, you remember? We don't have those anymore. We have people with asking the lawyers, is it okay for me to talk to the CEO or the service chief about this? So we've got to get ourselves back on the solid ground of honest conversation, of oversight that includes panels that actually do something. Right now, when we don't get the answer we like, we create another panel. The old panel doesn't go away. You know what I mean. So I'm going to spend just a couple of minutes talking about things that I think need to be super-emphasized and things that I think are missing. I'm going to start with what I think is missing. We go through a requirements process by which we, as Alan properly pointed out, we have come to the point where we know we're only going to have a couple of new starts, a couple of big acquisitions, and the objective is to stuff as much as you possibly can into that list of requirements and let somebody else worry about having to pare it down. The reason this happens, in my opinion, and people do not agree with me on this, in my opinion is we do not begin with the concept of operations that described how we're going to fight before we decide what we're going to buy to fight with. It is my opinion that the JROCS main concern should be with developing joint concepts of operations that describe how things should come together and ways that you will never get when you're looking at a program by program basis. Let me give you an example. If we, for example, had a global mobility condoms 15 years ago, perhaps we would have decided to stop upgrading certain airplanes and shift money to fast sea lift. Fast sea lift being the way that you get the bulk of the stuff over there and there were experiments going on at the time with 50-knot ships that were able to do that, and you were able then to focus your aircraft fleet on the things that absolutely positively had to be there tomorrow, but the whole closure of the whole global mobility problem in various scenarios would have been improved dramatically. That's an example. You can say the same thing for a global strike condom. You can develop a concept of operations that gives the president a better alternative for conventional deterrence. There are many ways you can go with this, but I believe that the JROC ought to take on not specific requirements for each of the services, but the joint concept of operations to which the services must comply, and instead of writing concepts of operations for the individual programs that we go after, we make sure that the programs we go after fit into the concept of operations that's already been articulated. And as things become more complex, as we can no longer break things down into the interdiction phase, into the C superiority phase, into the amphibious phase, into the things that we were able to sort of coordinate, as things become more complex, things must be integrated. Does anybody know how many lines in any services budgets are defined as integration? Now it happens, but it happens because of the intentions of good people, but one of the things that the next thing I want to emphasize here today is that we can get just as much out of integrating, properly integrating the things that we already have as we can, worried about modernization or new starts. And there's lots of examples, we don't have time to go into those here this morning, but integration of capabilities is not considered what's on the leading as of technology. It's not considered that thing you really want to, it's hard to get your arms around it, but when you look at what we're doing in special operations, and some of the quick reaction capabilities that were fielded, because of the demands of the commander in real time, and fielded in real time, they had to do with integrating capabilities in ways that we do not do in programs of record. So my comments to you today are about capabilities and pieces of this legislation that could be modified, I think, without really much change, that changes roles and integrates the personalities involved in different ways, rather than saying we're going to exclude them from certain things, that we get nowhere from that. It will not go anywhere. And I'm one that believes that transparency is the key to success. You leave the door open, you talk things out thoroughly, and that you align accountability and responsibility. And this is where I think the service chiefs come in. They should be a part of both the con ops, turning con ops into requirements. That's what they should be doing with the assistance of the JROC, and taking those requirements, and being a customer the way a Amtrak is to train cars. They order the train cars, they might write the requirements for the train cars, but it's a whole bunch of other people that actually use it when it's put into service. Con ops would be developed with the combatant commanders, of course, and who fights for the combatant commanders is the components, air, land, sea, cyberspace. So those are my two cents worth here, Andrew, in this very complex subject. Each of these things could be a four-day seminar, but so I'll stop right there. Thank you. Well thank you very much. Let me now turn to Dr. Gantzler, and he actually has some slides, which he can walk us through a little bit of, again, the history, and then how does it affect the system as we know it today? Andrew told me I had to do this in five minutes, so I thought this was an audience that cared about facts, and I thought that, therefore, not the 535 people necessarily in Capitol Hill, but I will try and quickly go through all this, and I started with this, as I said, this is the Packard Commission final report to the President, and I've stolen some, my first three slides come directly out of that, and so then what I thought I would do is try and relate that to today's acquisition issues, and so I've got two parts to this, and I'll go through them quickly, and then Andrew can make copies if anyone wants them. Okay, so the Packard Commission itself, which I have to admit I'm biased a little bit about, since Dave Packard and Bill Perry and I were the witnesses before the Congress of trying to convince people about the value of this program, and there are three pieces of it. The planning and budgeting is totally what I think General Jumper just wrote, although I don't know if you can read this, but what this basically says is that there's no question that the service chiefs should establish the planning and budgeting overall, how we use the dollars and how many dollars we'll need, and what they're going to be used for, and how they work together, and so it's not, to me it's not an either-or, the service chiefs or the Under Secretary for Acquisition, but it's both, and that's really what I think right now is the system, and that's what it should be, and the first of bullets of this is the better long-range planning, based on military advice, that's explicitly what's stated in the Packard Commission, the military advice is where none of the people like me should be writing what the military system should be, and then congressional approval of the longer term budget, and of course it should be based on what the military think they need, not whose district it's being built in, which is unfortunately the system that we have today, and then longer term budgeting, the biennial budgeting issue, and the second issue that was clearly addressed was this acquisition issue, establishing the Under Secretary of Defense to, as General Jombo just said, put all this together into an integrated package in order to meet the military requirements, and within the dollars available, which I'll cover in a minute, but then Congress started worrying about, of course, the ways fraud and abuse issues, and all that kind of stuff, so then they started writing a bunch of laws, and I'll cover that in a minute, we now have 186,000 pages of regulations, the code of federal regulations, but there's no question about where the commission came down in establishing the Under Secretary of Defense, and then, as was indicated, the service acquisition executives, and then the Joint Requirements and Management Board chaired jointly by the military and the acquisition executive, that's what specifically was recommended by the Packard Commission, and by the way, in terms of the question that Andrew Allen raised, I mean, that specifically says, how are we doing? The Packard Commission actually has a chart in there showing overruns of the defense programs versus things like the Rayburn office building, which was a lot larger overrun than the typical average defense programs, and so we're doing okay, but not great, and we can be improved, and that's the point, and so we've got to work on that. This is a study by Rand, comparing them, and again, the congressional buildings are more overrun than the defense program, and this is a study by my old company, TASC, and the same thing, you can see where defense programs are with that black arrow, and the congressional office buildings are farther to the right, I should point that out. Okay, so now let's try and touch briefly on the current situation. Well, I put that big question mark there on the right, nobody knows what the future is, and how do you do good planning without knowing how many dollars you're going to have, or what concerns you're going to have, but look at that dark line, the black line through the middle, that just simply says we need base closures, that's the manpower of being constantly cut back as the way to save money that Congress has been pressing, and then this is the state of global security in the world, it's not good, and of course a lot of this is the asymmetric concerns like cybersecurity, a lot more I could make a list of those, but these are what the military have said about the problems. The greatest concern about security is the deficit, and in terms of do we know what's next? No, more challenges than we've had in the last 50 years, and so therefore how do you do good planning with the uncertainty that we have? This is a set of graphs that I'm not sure everybody's familiar with, but this is, if we want to maintain technological superiority which has been our strategy, the top graph there shows industry investments in research versus government investments in research, industry investments have been twice, and that's why the better buying power 3.0 explicitly says remove the barriers to buying commercial type stuff, and I'll give you an example of that in a minute, and then the lower curve is the comparison between worldwide investments in research with US total investments, so some of the two top curves is the bottom curve here, and so what you'd expect to see is lots of global advances, and in fact that's exactly what's happening, there are many areas where we're no longer ahead where a lot of other parts of the world are way ahead of us, and in terms of the barriers to trying to move ahead, this is a curve that shows the number of pages in the Code of Federal Regulations, notice we're up to 186,000 pages, I'm sure you've all memorized them carefully, and know them well, but they are the barriers, and that's why 3.0 happens to have that specific statement, these are the things we should be removing, look at the cost estimates by OMB and the Small Business Administration, saying that these regulations are costing us about 1.7 trillion dollars so far, and it's also why an awful lot of high quality, high tech smaller firms, or even the larger ones, say no thank you to the Department of Defense, they're just not interested in trying to do work if you have to put up with all that stuff, and this is a chart I took directly out of the Packard Commission, this says at the time of the Packard Commission, comparison of semiconductors using mill specs and using commercial requirements, look at the difference between the two, the mill spec is more than order of magnitude more expensive, and more than order of magnitude less reliable, and you can get it much faster, why wouldn't you use them, well it seems obvious you should, and here's an example of a success story where the Air Force did choose to do it, and you can see the Chief of Staff of the Air Force then, I don't remember that whether you wrote those, but I think they're the right requirements, you want this, this is to take dumb bombs and make them smart bombs, and so what you want to do is you want to hit the target, that's the accuracy requirement, you want it to work when you push the button, that's the reliability requirement, and you want at the cost under $40,000 each, because we have a large number of them, tens of thousands of them, and we're going to convert all the dumb bombs into smart bombs so they meet these other two requirements, therefore we're going to have a strategy shown down below, use continuous competition, which is what the real world does, and which a lot of people in the DOD think, why do we want a second one, you know, what do you gain from competition, well it's pretty obvious what you gain from competition, lower costs and higher performance, and then the second thing is we allowed them to use maximum commercial equipment in the electronics, for example, the chart I just showed you, and the sensors, the GPS sensors, for example, and then to do the selection of the basis of best value, not cheapest, so it works, and then the experienced program managers, which both of these people have highlighted, as well as part of the strategy, now most important, look at the results, the independent cost analysis said that using mill spec stuff was going to cost $68,000 each, the actual bids by the two opposing bidders said that they can do it for under $18,000 each, so the difference between those two for over 10,000 of these things is quite significant, we're talking about billions of dollars, so why not do it, it makes sense, and that's what we did. Okay, then Bill Perry, who had, as I said, worked on the Packard Commission, and Bill put out a memo that said the Department of Defense should use major change, a new way of doing business, using commercial specs and standards, and allow the system to work that way, and that was not actually done. Okay, so instead we have these regulations and specifications, the 186,000 pages of them, and this is just a list of them, but there are lots of examples that I could give you of where this has killed us, for example the specialized cost accounting system is not something that most commercial firms have, the mill standard kind of accounting system, so Boeing used to build commercial and military transports on the same line, and that way they got economies of scale, and they got the benefits of technology transfer each way, but then the government, with these rules, said you've got to split them, so they put the commercial stuff in California, left the military stuff in Wichita, the price of both went up, who gained? Nobody gained, that's one of the problems that we ran, that's an example. By the way, I'll try to use examples wherever I can, Sam Nunn once told me, Jack stop giving me the theory stuff, just tell me an example so I can remember it, which I'll try and do here, and this is the rest of the barriers that I should, obviously they've got to be removed, and as Alan indicated, better buying power at 3.0 tries to do that, and I think that's a major step forward, and then logistics is a simple example, we spend a lot of money, it's the number one cause of cost, and clearly it's not world-class, if you compare it to FedEx and UPS, they give you total asset visibility continuously, the DOD system doesn't, compare it to Walmart, you take its item off the shelf, and it instantly notifies the industry, that there probably be another order for that part, the DOD system doesn't link the industry and the government, this is not what I have in mind, that's how to move one village to another, but look at the difference in performance, where we had, we moved to performance-based logistics with contractors support and incentivized to, based on performance-based logistics, you can see the response time dramatically different, and the availability of material dramatically different. Okay, so now what do we need? The other side of what I haven't talked about so far is the supply side, we want to take advantage of the demand side to things that I just already listed, but we certainly want to transform the industrial base to be able to deal more, and that's what the better buying power 3.0 talks about, to be able to deal more with commercial stuff, to be able to have these integrated military and commercial systems, and the reality is that's how you get economies of scale, that's by the way what the Chinese president is now, the president she is pushing for integrated civil military industrial base, and that's what the Packard commission was pushing, what Bill Perry's memo was pushing, and yet we don't have that because of this 186,000 pages. Okay, so we should emphasize lower cost, faster response, and commercial benefits, and maintain still our technological superiority, and one of the key points to this is worry about incentives, reward for performance. Okay, now global, why can't we take advantage of the global technology? I got a briefing the other day from the Army night vision lab saying the French are way ahead of us in night vision. Does night vision matter if we're going to go to fight ISIS in the middle of Africa at night? I think night vision matters, and clearly the number one killer of American soldiers and marines has been roadside bombs in Iraq and Afghanistan, so we should armor our vehicles, so we look around the world, and who has the most unfriendly neighbors? Obviously Israel, so therefore they probably care about armor, and they do have really outstanding armor, and so all we said to them was you should build your plant in America so we can buy America, and then they have moved their facility, they're moving their facility to the United States, and therefore we'll have world-class armor on our vehicles protect our people. Now this is a really interesting one, this is an MIT study that just came out of the treatment of basic research is very low priority in all of our budgeting exercises today in the military and Congress, both. The Congress views that I want to give money to the facility in my district, I don't want to worry about the next generation, but so why do we keep buying 20th century stuff instead of maintaining our technological superiority, which has been our strategy? This picture is the number one supercomputer in the world, where do you think that is, and whose is it? It's in China, right, and it's actually at the National University of Defense Technology, which is a PLA school in Changsha, China. All the parts in that, by the way, came from the United States, and yet what they're using it for is to design nuclear weapons for simulation and things like that. So it's not as though they're not well advanced in technology, and obviously cybersecurity is related to this supercomputer capability. Now this graph down below, which came from that MIT report, shows how we've been cutting the research budgets, and the same thing is true with the little box I put on the right there, is for university research, and again many good ideas come from there, although more recently a lot of the great ideas come from encouraging competition, and the Great Engine War is an example of that. You know, for the F-15, F-16 engines, we insisted upon a competition for those engines, Pratt and Whitney and GE, and both of them got higher performance, lower cost, and higher reliability. What more would you want? So the next program that came along was the F-35, the largest program in history. The Air Force chose not to have competition for the engines, and that, again, I would quite, I don't mean to pick on the Air Force, you know. It's true. But it does seem to me that that's an acquisition decision that was in the wrong direction based upon a demonstrated history. This, a Navy Admiral sent me this picture, actually from a harbor here in Maryland, and the dinghy is labeled original contract, the yacht is labeled changes clause. Now if you have fun as we do on the F-35, a single supplier, they're going to quote all those changes on a sole source basis. So we know what will happen in the absence of competition. The prices will just continue to rise as changes come along. The changes that come along may be because the Congress changed the budget allocation, maybe because the military changed the quantity allocation, maybe because of performance. There's a lot of different reasons that keep changing, or technology changes every day, as you all know. And so take advantage of the new technology. Sure, that'll cost you a lot. I'm sorry, we're the only ones doing this airplane. You know, I like, actually I shouldn't probably say this, but I like teasing Lockheed about the names they give to programs. The F-35, if some of you may remember when it was the Joint Strike Fighter at DARPA, had a design-to-cost target of 35 million. Now I think they should call the F-180, you know, something like that. And then the other program name that I like is the F-22. That's because it took 22 and a half years to develop it. Think of the electronics on that, at that stage. Okay, so public-private competitions, Congress has outlawed those because of the pressure from the government union. We've had over 3,000 of them, and the average savings was over 30%. This is the rest, more recent data, 38%. It's been outlawed, these public private competitions. Insourcing has been a big push by the government for 33,000 jobs. Separate studies by CBO and GAO, both said that's 90% more expensive. There's no incentives in that case, that's one of the reasons. And so why would you want to do that? Not have continuous competition. And innovation, where our technological leadership comes from, which the red curve there is the major firms. Somebody wrote this report by saying where are the major innovations that have come along in the last few years and where did they come from? Well, it used to be that they came from the big firms, the red curves there. And many of them also came from universities, which are the green curve there. And more recently, they've been coming from small firms, at the SBIR program, this is Small Business Innovative Research. And a lot of those actually are linkages between universities and small firms. We actually did a separate study of that and showed the quantity of the small firms that have heavy involvement of universities. But also there's a lot of linkages between those and the big firms, people spinning off forming their own firms. But I think it's important and some big firms are now complaining that it's a tax on their research. Clearly, that's what we're looking for is innovation. Okay, as I just pointed out, critical need is the workforce, education, training of the workforce. I've been shocked when I asked people like at the Defense Act of the University, are you teaching best practices, commercial best practices? They weren't teaching that. They were teaching follow the rules. The rules are the 186,000 pages of the rules. And that's not necessarily best practices. And this is Congress interfering with the workforce. The red curve here is after 9-11 how the procurement budget skyrocketed. And then Congress passed a law about the same time, cut the workforce by 25%. So it worked twice as hard, I guess. So let me end up by saying that the left-hand column here are what I think are the needs for acquisition change. And the right-hand column is unfortunately the current trends. We need to maintain technological superiority. So if you go to the right-hand side, it says we're cutting research funding. We need to take advantage of commercial and global technologies, but we have barriers to doing that. We need to remove these barriers, but we keep adding more barriers to it. Congress has about 2,000 pages every year. We clearly need to attack the logistics costs and improve our performance. We clearly need to keep up with global technologies and not fall behind in them. We require lower cost, higher performance systems, and that's not the trend that we've been getting. By the way, all of our rules are based on buying things, goods, if you will. You know, ship planes and tanks and things like that. But we spend over 60% of our dollars on services. Now would you think you could use the same rules? Is there any difference between buying a tank and buying an engineer? You know, you don't really have to put the engineer through live-fire testing like you do with the tank. In fact, you don't want to. Okay, there's more need to emphasize innovation rather than current factory loads. And that's why I said the SBIR program is so important. And I think the workforce is a critical resource and we've got to recognize that as well. And then smart competition. I've been getting briefings by the people in the services and service industry, saying that too often the current selection of, you know, during the competition is based upon low price. LPTA, low price, technically acceptable. Now how many of you would buy your heart certain on the basis of the lowest hourly rate? That's what the government is now doing. That strikes me as not the right choice. And cycle time, clearly as I said the F-22, technically electronics 22 years ago, you know, that they're obsolete. Why aren't we more rapidly transferring our technology? Okay, so my last slide. I think we've got a clearly declining budget. That's our debt structure. It's not much we're going to do about that. And so with fewer dollars and more concern, national security concerns, how do we maintain our leadership with technology changing rapidly unless we invest in the new technologies? And be responsive to do it more rapidly. And then as General Jumper said, think of it collectively, not each separate service, but joint activities. I mean, I'll give you an example of that one too. When I, one point years ago, I was responsible for electronics R&D and OSD, and the Navy and the Air Force separately came to me and said that each one is satellite navigation system. And I remember saying to them, are you using the same earth? Why do you each want your own system? And I said, I'll only approve it if you have an army as a major deputy in the program, because that's where all the vehicles are. That's where every soldier is going to want to know where they are relative to everybody else and relative to the enemy. They're going to have a GPS on their shoulder. And so we went along with that. And then I even asked the Air Force, how much is your user equipment going to be? And the answer I got back was $150,000 each for an airplane. Now, on my cell phone, I have a GPS now. I didn't pay $150,000 each for it. You know, obviously what I told them they had to do is to go to a commercial electronics house and have them design and receiver equipment, which they did. And that worked out fine. And so now we have the whole world using commercial GPS. And we're taking full advantage of it. It seems to me that's the kind of thing that General Jomper was talking about in terms of working together. Now, I still run into a problem at the Air Force when I was under secretary would come to me and say, this is a national asset. Why do we have to pay for it? And I said, I thought you were responsible for air and space. The space is the, you know, the satellites. But it turns out, of course, that it is a national asset. And we do need to have cooperation, as General Jomper pointed out, among the services in order to make the best selection of everything that we need. That'll work fine. And so we've got five areas we can focus on. The first one is clearly a military requirement. What do we buy? And how much money do we put aside for each of these areas? That's not a question to me. How we buy is the acquisition process and the regulation thereof. That's an acquisition issue. That's one where we need cooperation, working together with industry as well as with the military. And from whom we buy, that's the industrial base restructuring that I think is required. And then who does the buying? That's the acquisition workforce. We've got to really focus on professionalism in the acquisition workforce. And then the support function, the logistics, you know, figuring out how to do world-class logistics ourselves. And I think that's what the effort currently under way with the House and Senate bills are. It's a try to see how we can address these five issues. And clearly they can be improved. All right, thank you, Jack. And one of the things that I think came out of the presentations, there's important areas of difference probably amongst some at the table and those not at the table on a lot of these things. But what's interesting to me also, and I think not unprecedented, is there's actually also a lot of consensus. There's a lot of consensus on the fact that the service chiefs need to be intimately involved in the acquisition process. There's consensus that the secretary of defense needs to be intimately involved in the acquisition process. And I took note that Senator McCain shares that view mentioned in remarks that he made the other day that he thinks the secretary absolutely needs to be involved. He also feels that it's adequate for this, for him to be involved through the service chiefs and the service secretaries. And that may be a difference. But the underlying point that acquisition process is a sec def responsibility is a point that seems to me of consensus. There's a lot of, I think even at this table, consensus that access, more access to commercial technology, to global technologies, to innovation is critical and non-traditional suppliers. And there's consensus on the importance of the workforce, which kind of leads you to wonder of why is there always such a big debate? You know, there's a lot of consensus out there at the same time that clearly, you know, there's there are areas of difference. But the question that seems to be to be the overriding question that the Senate has raised, which is a very important one, is this issue of accountability? And how do you ensure accountability in a system that is as complex as the acquisition system is? And that's obviously a very important objective, something that I certainly think is important. So let me just kind of throw that out to the panel. You know, it's been suggested that maybe changing the way Milestone Decision Authority works and changing the roles of the service chief is the way to get more accountability into the acquisition system. And I do think that's a worthwhile goal, may not be the only goal on our acquisition process, but definitely worthwhile one. And so let me throw that out to the panel and get some views from folks who've actually done it. I'll jump right in there, Andrew. We also believe in accountability. In fact, if you look at Acquisition Decision Memorandum that's signed out today by Frank Kendall, it'll name himself, the PEO, the program manager and the SAE all in that, so you can track back. The problem that you run into, frankly, in the acquisition process when you start looking at, okay, who, let me jump back one other point. I'd also point out that we have, in some cases publicly, in other cases not so publicly, removed PEOs and PMs who are not up to the task. And that's a systemic failure for not training the right people for that. But we have certainly done that in cases of failing programs. The problem that you face, regardless of whether Senator McCain's provision goes through as is or not, you know, whether we put it back in, is that when you realize the system, the program is failing. The SAE is probably gone. The DAE is probably gone. Even if we put in some longer tenures for the PEO and the PM, by the time that the program is truly failing, they're going to be gone. So who are we going to hold accountable? And then you can ask yourself, am I going to fire a service chief? Am I going to fire John Jumper as a service chief because a program is having a cost overrun? Or is his portfolio a little bigger than that? Same thing with the service secretary. So yes, you do need to hold people accountable, but you also have to rationalize that people have larger portfolios and we do certainly remove PMs, PEOs that are not performing, but there's a time lag in the system before you find that path. I would just say in my experience, there have been very few times a program has failed where we were fully knowledgeable of those elements of failure that we're building up over time that led to the decision that it was finally failed. And we just, we didn't recognize those or have the mechanism in place in our program review process to be able to do something about it soon enough. We let things go too long. With the assurance of program managers and others in industry on the industry side and the government program manager side that this was all fixable or doable, in other words, not being active soon enough. I think that the decision authorities and the accountability and the responsibility, the secretary of defense or Frank Kendall should say for this program, it's going to be here. For this program, it's going to be here. It depends on the size of the program, the responsibilities involved. If you're going to build a new aircraft carrier or a new bomber, it may be one solution. If you're going to build a new joint program of some kind, it may be another solution, but you shouldn't have a fixed formula. I know one size fits all when you are buying programs over such a wide scope, but accountability and responsibility has got to be in the same place. Those who are accountable have to be able to pull the levers that allow them to see the data, understand the problems while they're building, and again the transparency and the fear of failure, the cost of failure here today is, we penalize the slightest hiccup in ways that we I think are really sort of unprecedented, and I think that the path to any great achievement that we've seen in technology has had its bumps along the way, and so the system has to allow for that too. Yeah, I guess I'd agree with both statements. It's not the same for every program, A and B, I would certainly put into the list of who's responsible, the industry side, not just the question of within the DOD who's responsible, but then you also need to have the decision-making capability someplace, and I think that clearly, obviously I'm biased, but I think clearly belongs to the Secretary of Defense's office. I mean an example of that that I like using for comparison is Global Hawk. Two years in a row when I was under Secretary, the Air Force zeroed Global Hawk, and that was simply because it didn't have a pilot. I mean this is a cultural question, you know, it's counter-cultural, and so it seemed to me that that was a responsibility, and I pointed out to the Air Force at the time that it's a lot cheaper Global Hawk than the manned system, and because you don't need life support systems, and secondly it saves lives. So wouldn't it be a good thing to have something that's cheaper and saves lives? Well there's a lot more to that story, Jim, you can go ahead. I realize that John, but I wanted to make it clear. Do you have any other examples from the other side? Yes. We were the biggest defenders, I guess. No, no, I just like picking on you. It's easier. You're right here. Look, a record show that Dr. Gansel didn't shy away from picking on the Air Force or the logistic system just because he was on a panel. But clearly the fact that we have differences of opinion has to have an airing, and that's why it's not either or choice. It's not a military or civilian choice. It's both. They have to be able to have the dialogue, and that's what Jim Jumper was pointing out, where we get together and try and decide what makes the most sense for the nation within the dollars available and within the threats that we know we have to be able to address. And right now we're going through a big battle of who's going to pay for cybersecurity, and, you know, that's clearly a growing concern. And whose responsibility is it? Everybody's industry, government, each service, and other agencies within the government. So we've got to figure out a way to address that kind of question as well. Let me ask one more question, and we'll turn to our very patient audience here who've been waiting to get their turn. But the one thing that strikes me about accountability is, as critical as it is, it's to my mind not the entirety of the story, because accountability, it's something you want to think about upfront. You want to establish, as was mentioned by General Jumper, you want to align responsibility and authority. But it's also, generally speaking, we worry about accountability when something's gone wrong. And so it seems to me that you don't want to think solely about what do we do when something's gone wrong. You want to think about how do we set ourselves up for success, so that hopefully we don't get to that big accountability moment. Have to be ready for it when it comes. But ultimately, you want to think at least as hard about how to be successful as what you do when you fail. And so let me ask a little bit about that. Now, since everyone's sharing their biases, I'll share my bias. I think one of our successes, and Alan referenced it in recent years, has been in the rapid acquisition process. Actually, General Jumper referenced it too, that we have been successful. And it's not unparalleled success. There have been some turkeys that happened in the rapid acquisition system as well. But I would think a pretty reasonable measure over the last 10 years would be to say that we did pretty well in fielding things quickly, that we needed, that were actually very important and helpful, and did change the fight. And so the question is, what are the critical aspects of setting things up for success in addition to the concern about what do we do when things go wrong? And what's worked that we need to reinforce? Yeah, there's a couple of things there. I'll go back to to what General Jumper said early in his statement about, you know, the requirement is the warfighting connobs, not the capability, not this platform, it's the warfighting connobs. And as you know, when we started looking at things in the rapid acquisition process, one, we took a lot of things that were off the shelf and we integrated them so that they provided the capability to meet the connobs that we had a fight with. So it wasn't ground-up development. In some cases it was. None of those ground-up developments were way over the top state of the art or past the state of the art capability. So, you know, an MRAP tends to be a kind of poster child, as I am fond of saying and I've said in congressional testimony, an MRAP's a truck. It's a big heavy truck with a lot of good armor, Israeli armor, around it with the design that protected it and with an electronic warfare suite that was designed to protect the truck. All good. And we did that all rapidly. And then we took a lot of UAV capability and made them big, small, but again, things that were kind of already on the shelf and then just packaged them with newer and better sensors that we evolved over time. So it's the willingness to do that. And then, as you know, we set up a process to cut through the bureaucracy to do that so that programs knew that this is their number one priority because we had folks on point to engage in combat. And there's nothing more important than giving them the protection or the capability to win that they needed. So that can work in a lot of situations. It is not going to design you the next long-range missile. So you have to fit those things into their pieces. We could take some instruction, Allen, though, on which of those need to be turned into programs of record. Maybe not as they exist today. Maybe it's not the king air that carries the thing, but it's the thing integrated into something else that gives you that capability that the commander at the time thought was important enough to talk all of us into building and responding quickly. I would say there are basically two things that to do this rapid acquisition that we should look at. One of them is success stories. Lessons learned. How did we do it? And what the second thing would be how do we remove the barriers that we now know causes to have these long delay cycles? Within the services and within OSD and even within Congress, we have to address each of these barriers and remove them so that we can do things in the five-year cycle we'd like to have it, which is also what's done in the commercial world. If you compare it to the commercial world, how do they do it in five years instead? Why does it take us 22 years? If I could, I just need to jump on since you raised the opportunity to point out stable budgets and the ability to move money around in the budgets is key to doing that too. All right, well, let's open up for audience questions. We have folks with microphones so as you're selected, please tell us who you are and ask your question. And I always try to start with someone on the front row so we've got one hand here. Good morning, Tony Burtuka inside defense. Thank you for being with us today. Getting back to what Mr. Hunter said about John McCain's central argument that he made the other day with section 843. He says, the service chief's work for the secretary of defense, not the other way around, and he finds it to be, you know, there's a weird interpretation, I think, where his words that somehow sect f is being cut out. Who he's cutting out is AT&L. Can you tell us why his rationale for doing this is wrong? Maybe in planar terms, why is it not enough to say the service chief's work for the secretary of defense? He's not really cut out of the process. First section 843 doesn't talk about the service chiefs at all. Talks about the service acquisition executive service secretary. So there's another section on service chiefs, we're all for that. It also puts a whole bunch of restrictions inside 843 on data flowing up through the secretary's staff. So yes, the secretary on, if he wants to look through the soda straw on a program, can bring in the service chief on that program and talk about that program. That's not how the department gets managed. So it does two things, it restricts data flow, bad thing in any kind of organization. And it takes away his staff, his direct staff's ability to provide him information so he could even have an intelligent discussion, frankly, with the service chief or the service secretary in reality on that soda straw of a program. You'd have to know that something's going on to begin with, right? And I'm not saying that the secretary has an idea of what programs are in his portfolio, and he certainly knows when we go through a budget time on what we're funding and what we're not funding. But if you look at the things that the secretary of defense needs to be managing in today's world. So there's the forces engaged starting there. There's budget crises going on. How do you set the direction of the department of defense? The secretary of defense is not managing programs. He manages big decisions around those programs and he manages the portfolio around those. If something goes off the rails, yeah, he'll get involved. But that's not the way the department of defense gets managed on a day-to-day basis. And you should think about the dollars are fungible. I mean, they're not marked that you can't move them from one place to another. And as General Jumper pointed out, a lot of these programs are going to be joint or need interoperability or can be cooperative. And so the combination of the budget flexibility and I mean it's whose dollar is it? You know, it's what's best for the nation. And that's somebody has to resolve that. If I just pile in on this myself, one point as an example, the Ohio replacement program which is a very important one that's actually been through some of the milestones that are important, but as an example, the Senate language does say that joint programs will go to OSD and that's the secretary's discretion. But is the Ohio replacement program a joint program or is it a Navy program? Submarines have historically been Navy programs. It's not historically something that would wind up on the joint list, but on the other hand as was pointed out about GPS, it's a national asset. And the Navy has argued about the fact that it's a national asset that this is something that supports the nuclear triad and not solely a Navy responsibility. And so where then would it fall out? As the secretary then hold the bill, but the Navy does the program management. Of course they're going to do the program management, but do they define all the milestones in that system? And so I think actually the Senate language gives flexibility. The secretary could make a decision there. But to me, the question is, is the presumption that the statute establishes that in almost all cases the responsibility should go to the service, is that the right presumption? I think that's the... Here again, there's middle ground here. You don't have... You can have joint participation in a program without calling it a joint program. In my mind, there's no doubt about where a submarine program should go. Any more than where an airplane program should go. But the fact is that if you have another example would be an aircraft carrier. What would be the matter with the next aircraft carrier having as a deputy program manager the person who is concerned with command and control of the air power that's going to come off that carrier so that we are assured that the integration piece is properly considered in the full joint connoisseur that should be developed and articulated. So why wouldn't... Couldn't an Air Force guy be the deputy program manager on an aircraft carrier or a Navy guy be the deputy program manager on a long-range truck? For instance, it's not a joint program but you get those joint considerations in there in a different way than all the baggage that tend in the emotion that tends to come with these joint programs that again bear a cost themselves to the program. Thank you to agree with that, Allen. Over the long term, yeah. Okay, why don't we... Hi, Tom Davis, senior fellow at NDIA. Great discussion. Appreciate the time of all the people on the panel. I did have one comment about all these concerns about authority and accountability when I was with General Dynamics we had a program in trouble and I went down to see the manager and told him I was going to get him some help and he says, does that mean I get more horses or more jockeys? And a lot of cases I think we get more jockeys and that dilutes the authority. One thing I wanted to ask a question on, Dr. Gansler, you had a chart up there, I think number 30 which had a list about innovation going down and you referenced the Fortune 100 and the Fortune 500 and I just want to get your view because you have noted authority on it and General Jumper because you also ran a major defense company for quite a while. The latest Fortune 500 came out last month. And if you look at it very closely there's some interesting things in there. In 1961 when President Eisenhower talked about the military industrial complex there were 16 companies in the Fortune 100 that were either completely or significantly involved in the defense industrial base. Today in the Fortune 500 there are 11. In the 100 there are four of whom the top two are only partially in defense at being Boeing and UTC and of course the second is basically trying to exit the market with Sikorsky. It seems to me that a major focus of acquisition reform is really being missed by all the discussions about authorities and responsibilities and whether or not the chiefs are involved. You know I agree with General Jumper's comment a hundred percent on that. Isn't a major responsibility or a major vector here doesn't it need to be to take out as quickly as we can all these barriers that Dr. Gander you mentioned quite accurately in my view exist that discourage people from entering the defense business which is where you get cost competition and innovation and it encourages those in to get out which is what we're seeing right now. Absolutely. I think we have to try to figure out how to incorporate this commercial advanced technology and even global advanced technology into our industrial base. I mean the reality is that many of these barriers ignore reality ignore the globalization of the industrial base today and the fact that that there's a big advantage to being able to have civil military industrial integration. So we have to address it not just in terms of the decision maker which is what we've been talking about here more but also the supply side. Which is what your question is addressing. I mean why can't we take full advantage of what's happening in the world the reality of the world in terms of civil military industrial integration and globalization. And we're going to be fighting with allies. No question about that in the future. And so it seems to me that the point that John Jumper made about multi-service is going to be multinational. And to the extent we recognize that and want interoperability with our allies and take advantage of where they have state-of-the-art stuff that's advanced from us. Why can't we take advantage of that too. I mean that's the industrial base kind of question. Most of these companies that you referred to are global. And we should take advantage of that. My example is that I became CEO of a company that was had subjected itself over time to a construct that was beginning to show organizational conflicts of interest in order to deal with that. No matter because of the wide definition of organizational conflict of interest we had to separate the services business from the solution business. This was an extremely complex maneuver that astonished me in the number of barriers that were thrown in our way in order to do what was best for the customer, best for the government, best for us, best for all involved with the bureaucracy that we had to deal with. And I, you know, I couldn't agree more with you about the need to simplify to rely more on the 99 percent examples of good behavior rather than the one percent examples of bad behavior deal with those bad behaviors extremely harshly. I have no problem with that. But there's got to be elements of trust that are reestablished that have eroded over time between the relate in the relationships between the between the government and industry especially I think in the in the contract management agency, the defense audit agency are two good examples. And I would agree I think with both my colleagues up here on what they said but I'm going to lay out some other issues because it's not a flack in white right there's a spectrum here you need to be able to deal with non-defense non-traditional defense and there's capabilities to do that. So I need to train people on how to do that when it's appropriate. I do that well in the DARPA arena and I do that well through SBIR grant but I need to do more of that I need to look global there's biases there there's biases inside the department there's biases up on the hill related to that but we do need it's global technology we should be getting the best technology for our kids period. But I also have to say I'm buying for the taxpayer I'm using the taxpayers money to buy profit margins in the private sector put me up on the hill explaining how come I gave this profit margin especially when I end up in a non-competitive environment which we end up doing for a long-term program. The defense industry the traditional defense industry has you know where we end up paying R&D costs a chunk of the R&D costs that is not done in the commercial sector I don't figure I don't give Apple money to develop the next phone I fly the satellite that's the GPS and you know to some degree and I have sustained production over a long period of time and their return on investment shows that so there's a spectrum that we need to deal with it is not a black and white cookie cutter approach we just need to ensure that our people know how to utilize the full spectrum of the approach. One of the most obvious areas that applies to your question is is the information technology arena where clearly the commercial world is way ahead of us and we should learn how to take advantage of that better and that's again an industrial base question how do we deal with that and some of these barriers that we've created prohibit us from doing that that that seems to me an obvious case we're here every system that we have nowadays is dependent on cyber and therefore more and more of the direction that we have to look at is how do we gain the benefits of the industrial based commercial sector there's a couple of themes that have come out of this this most recent discussion that I just kind of wanted to highlight one is that I think everyone is reiterated about how you can't have a single solution or a cookie cutter approach to problems and defense acquisition the second theme that that I'm at least taking away maybe I'm bringing something to the table here is about how the bear you know we're all concerned about bureaucracy and I know I can't imagine anyone sitting at this table or out there doesn't feel like there's excessive bureaucracy and the defense system that could be dealt with but I think to my mind it's it ties to this issue about the barriers if the bureaucracy is defending the barriers it's not so much that having to come to OSD to have a discussion yes that will involve a certain bureaucracy that bureaucracy may or may not go away if you change the question of whether people have to come to OSD to talk to the secretary but but the barriers if you could eliminate some of the barriers there's definitely bureaucracy associated with each of those we can of course debate what's the right way to adjust them and which ones are worth keeping which one aren't I think we have time for one last question over here we'll wrap up here on the blue blue shirt thanks very much Dave Lincoln I'm long term itinerant on the industry side and I have two things about the fear of failure that I'd like to ask you to comment on because I believe that programs fail or go over price one requirement at a time and it's in the interaction down there at the p.m. level that's important one is on an a cat one that failed I found that the service absolutely considered a failure to set aside requirements in order to go by then what then was called cost as an independent variable could not get them to think about it and I think it was because that would have they would have gotten pummeled back in the office to propose such a thing another on a a cat three transition from OCO in a UAS program to a program of record now the working level civil servants could not imagine accepting best commercial practices as evidence of satisfactory testing or something like that so both those cases I think are I mean I think fear of failure is a huge factor in making things work better yeah there's the default punishment is cut off their heads and the first question you're going to be asked is who's going to get fired for this and actually in many cases without even judging the you're trying to gauge the how egregious the failure was but you got good you those are good points I can I've got a whole list of them you know of of requirements that are not guided by a concept of operation that if you guide them by a concept of operation it answers a lot of these these kinds of questions that keep people from just adding the requirements or if you've got the service chief involved or the combatant commanders component commanders in the field involved they can do those instant tradeoffs of requirements versus cost that come to the table that says okay yeah okay we can we can give on this or and you can also take advantage of advancing technologies the point about the about the f22 could we have put a more modern processor in there well if we'd have thought about it early enough the answer is yes but we didn't build that kind of thought into it in the initial design so you've got it I'm with you I think you have to define what the failure is too is it performance is it the military need or is it the schedule or even even worse is that it just violate one of the rules you know that that the 186,000 pages you know is that a failure or if it satisfies the military need and within cost and within schedule it meets the the requirements as far as I would think but not the illegal requirements because of that some congressmen put in a rule at some point so it's it's how you define this failure you know I think you had two good examples too and you know a couple of thoughts one all cost overruns are not costing is an exact art not a science one so we're going to and especially on something I might not have ever done before or anyone has ever done before so I'm going to kind of take a swag at something like this in the past put a number out there and then be shocked that it didn't come in at exactly that number or below that number when I'm pushing the envelope so then you have to say what's your tolerance and what's the need and what's the risk that you're willing to take well we don't do well as fail fast that's a lesson we need to learn from industry in which case when you fail fast then you don't have to shoot the person who failed because you took a shot you rolled the dice it didn't pan out you move on you take the lessons learn and you try to take that to the next level we can't put ourselves in a situation which we find ourselves in many times of the requirement has changed because the thread has changed and I'm designing this thing that I've put the bed on 10 years ago you know so you need to have that kind of iteration and plug and play and you know and we it's a process to do that on your other point on you know this ACAP3 we have a whole process that is not working that way where induct a commercial thing and then we have a whole process that says radios is another example where hey I'm buying this commercial radio oh but it has to we're go through this full testing but we know it works so and then I'll get an IG report that will come in and say well you didn't follow your process you know so that's where our own bureaucracy from the hill to us is needs work and that's where getting back to why is acquisition reform good why is continuous process improvement good the continuous is continuous it always needs work well thank you everyone and I think there's there's real news that's come out of this forum it's that you can get over a hundred people into a room for a teed deal discussion about acquisition policy and they'll stay for an hour and a half and they'll stay awake so I'm impressed thank you please thank our panel it's a great discussion and we will make Dr. Gansler's slides available on our website with his permission but it sounds like he's interested in that so thank you