Americas Defense Meltdown - IT Acquisition Advisory Council

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198 • Long in Coming, the Acquisition Train Wreck is Hereincluded in its approved modernization budget into the out-years to repair, overhauland replace equipment damaged, destroyed or worn-out in combat operations inIraq and Afghanistan. On top of these immediate funding requirements, the Army isfaced with the steady growth in operations and maintenance (O&M) costs that haveplagued all the services over the past decades. In its annual report to Congress in early2008, the Congressional Budget Office (CBO) reported 3 those costs grew steadily byan annual average of $2,000 per active-duty service member from 1980 to 2001 beforehitting the spike resulting from the aforementioned combat operations that havebeen funded to a great extent by supplemental budget requests. Excluding potentialunbudgeted costs for the continuing GWOT, the CBO projects a similar rate of O&Mcost growth in the future. Furthermore, the Army and Marine Corps will requireyet additional billions in funding in the coming years to accommodate the plannedincrease of 92,000 in their combined active duty end strength.For its future modernization, the Army has built the bulk of its plan around itsFuture Combat Systems (FCS). Planned as a revolutionary, “leap ahead” system, itwould form the centerpiece of its ground combat forces to be fielded between FY 2015and FY 2020. Army plans describe FCS as a mobile, deployable, lethal and survivableplatform, incorporating advanced technology components to enable a significantincrease in combat effectiveness. The program consists of an integrated family ofadvanced, networked combat and sustainment systems; unmanned ground and airvehicles; and unattended sensors and munitions intended to equip the Army’s newtransformational modular combat brigades. Within a system-of-systems architecture,FCS now features 14 major systems (already down from its 2003 plan that called for18 new systems) plus other enabling systems along with an overarching networkintended to provide information superiority and survivability.The FCS program was approved in May 2003 to begin its System Design andDevelopment (SDD) phase of development. FCS plans then called for the ambitiousdevelopment of the 18 individual systems that included armored ground vehicles,unmanned ground vehicles (UGVs), as well as several classes of unmanned aerialvehicles (UAVs). At that time, the Army planned to stand up an experimental FCSbrigade in 2008 equipped with all the new systems.Since that time the program has undergone numerous far-reaching restructurings. ByJuly 2004, the Army announced that it planned early delivery or “spin out” of selectedFCS systems vice the earlier plan to deliver all the systems simultaneously. This new plancalled for a phased approach to “spin out” mature FCS equipment to existing forces,provided the equipment demonstrated military utility during testing, slated to begin inFY 2008. The Army, however, planned to test spinout hardware using surrogate radiosbecause technical issues had delayed development of its family of new radios. As of theexisting schedule, production-representative radios would not be available for testinguntil at least 2009, after the production decision for spinout items.
Thomas Christie • 199FCS Milestone C, with approval of initial production, was slated for 2012, leadingto an Initial Operational Capability in 2014. Finally, a Full Operational CapabilityFCS-equipped Brigade Combat Team was planned to be available in 2016.In August 2006, the program documented the desired functional characteristicsof FCS systems and the criteria for achieving those characteristics. Although a notableaccomplishment, this event should have occurred before the start of development in2003. As a result, the program began life with more cost, schedule and performancerisk than was necessary. Army officials downplayed this risk by telling the GovernmentAccountability Office (GAO) that they could trade-off FCS capabilities to maintainschedule and cost projections.It turned out to be a false hope. The GAO, in its March 2008 report 4 , entitled DefenseAcquisitions, Assessments of Selected Weapon Programs, shows FCS RDT&E costs,in constant FY 2008 dollars, rising from the $20.5 billion projected at program approvalin May 2003 to $28.5 billion, and total acquisition (RDT&E + procurement)costs increasing from $88.3 billion to $128.5 billion.The cost of the FCS program and its impact on the Army budget over the nextdecade or so is a critical issue. The following discussion is extracted directly froman excellent summary report on FCS issues by the Center for Defense Information(CDI) 5 , dated May 30, 2008. This report draws data and information from variousgovernment sources, to include the GAO, the CBO and the Congressional ResearchService (CRS), as well as pertinent DOD documents. The report paints a fairly bleakpicture of future cost growth and raises questions about the affordability of the FCSas presently planned. Extracts from the CDI discussion of these issues follows:“Not only has the projected cost of FCS development and acquisition increasedsignificantly, FCS has not yet reached the critical design review(scheduled for 2011); it is after this point that most development cost growthoccurs. The Congressional Budget Office (CBO) estimates that costs couldgrow 60 percent. Therefore, it is hard to have confidence in the cost estimateput forward by the Army. By the time of initial production, the Armywill have spent 80 percent of its development funds, before crucial networkdevelopment and demonstration. Even if all technology is developed andperforms as expected, there is the danger that FCS is simply too expensive.”“Additionally, two separate entities, the Institute for Defense Analyses (IDA) andDOD’s Cost Analysis Improvement Group (CAIG), have performed independentcost estimates, and their cost projections are substantially higher than theArmy’s. IDA examined only RDT&E (Research, Development, Test and Evaluation)costs, which it estimates to reach $38.1 billion, compared to the Army’s$25.1 billion. The CAIG estimated total program costs to be between $203.3
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AMERICA’SDEFENSE MELTDOWN★ ★
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America’sDefenseMeltdownpentagon
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Bruce I. Gudmundsson served in the
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James P. Stevenson is the former ed
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table of contentsPrefaceExecutive S
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PrefaceThe mere notion of a “melt
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Preface• xieffective national sec
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executive summaryChapter Summaries
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Executive Summary • xvThe militar
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Executive Summary• xviiRecommenda
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Executive Summary• xixobjectives
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Executive Summary • xxiThe chapte
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Executive Summary• xxiii• Analy
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2 • Introduction & Historic Overv
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10 • Introduction & Historic Over
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CHAPTER 2SHATTERING ILLUSIONSA Nati
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28 • Shattering Illusions: A Nati
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CHAPTER 4MANEUVER FORCESThe Army an
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82 • Maneuver Forces: The Army an
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98 • A Traveler’s Perspective o
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100 • A Traveler’s Perspective
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CHAPTER 6the navyWilliam S. LindTo
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120 • The Navy- signaling - would
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122 • The NavyAt the same time, t
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124 • The Navyforce: first, to de
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126 • The Navywarfare usually wor
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128 • The NavyEndnotes1 Andrew Go
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130 • Reversing the Decay of Amer
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Americas Defense Meltdown - IT Acquisition Advisory Council

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