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We are pleased to be here today to discuss issues facing the Department of Defense (DOD) in its acquisition of weapon systems, related spare parts, and other goods and services. In response to the many changes that have been witnessed in the defense acquisition environment over the last few years, DOD has begun broad-based changes to its acquisition and contracting processes. However, weapon programs continue to have questionable requirements; unrealistic cost, schedule, and performance estimates; and strategies that begin production before adequate testing has been completed. This discussion of acquisition issues is well-timed, as DOD implements plans to increase its procurement budget to $60 billion in fiscal year 2001-a 40-percent increase over last fiscal year's budget. My testimony focuses on a different approach to improving weapon acquisition outcomes based on best commercial practices and an understanding of the acquisition culture. My testimony also includes some observations on (1) DOD'S management of its acquisition workforce and organization, (2) DOD'S experience with commercial pricing of spare parts, (3) the effectiveness of DOD'S mentor-protege pilot program, and (4) federal agencies' use of multiple award task- and delivery-order contracts.
Since 1990, the DoD mgmt. of major weapon system acquisitions has been designated a high-risk area. DoD has taken some action to improve acquisition outcomes, but its weapons programs continue to take longer, cost more, and deliver fewer capabilities than originally planned. Over the next 5 years, DoD plans to invest about $900 billion to develop and procure weapons systems -- the highest level of investment in two decades. This testimony describes DoD¿s current weapons system investment portfolio, the problems that contribute to cost and schedule increases, and the potential impacts of recent legislative initiatives and DoD actions aimed at improving outcomes. Charts and tables.
This report examines how well DoD is planning and executing its weapon acquisition programs. The report includes: (1) an analysis of the overall performance of DoD's 2008 portfolio of 96 major defense acquisition programs and a comparison to the portfolio performance at two other points in time -- 5 years ago and 1 year ago; (2) an analysis of current cost and schedule outcomes and knowledge attained by key junctures in the acquisition process for a subset of 47 weapon programs -- primarily in development -- from the 2008 portfolio; (3) data on other factors that could impact program stability; and (4) an update on changes in DoD's acquisition policies. Includes a one- or two-page assessment of 67 weapon programs. Illustrations.
DoD plans to increase its procurement investment to about $60 bill. by FY 2001. DoD has high expectations from this invest.: that new weapons will be better and less expensive than their predecessors and will be developed in half the time. Essential to these outcomes will be the adaptation of best practices (BP) that have enabled leading commercial firms to develop new products faster, cheaper, and better. This report addresses (1) the contribution DoD training makes to program offices' ability to apply BP , (2) the different methods used by DoD and commercial firms in training on BP, and (3) the strategic approaches that underlie DoD's training methods for BP.