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Department of Defense INSTRUCTION

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DoDI 5000.02, January 7,

DoDI 5000.02, January 7, 2015 authority, and is defined as a funding or quantity decrease that impacts the viability of the program and/or significantly increases the costs to the other participants in the program. 6. PROGRAM MANAGEMENT RESPONSIBILITIES. Program managers direct the development, production, and deployment of new defense systems. Management activities will be designed to achieve the cost, schedule, and performance parameters specified in the MDAapproved Acquisition Program Baseline (APB). The following tools will be used to facilitate effective program planning and execution. a. Acquisition Strategies (1) Overview. The Program Manager will develop and execute an approved Acquisition Strategy. This document is the Program Manager’s plan for program execution across the entire program life cycle. It is a comprehensive, integrated plan that identifies the acquisition approach and key framing assumptions, and describes the business, technical, and support strategies that the Program Manager plans to employ to manage program risks and meet program objectives. The strategy evolves over time and should continuously reflect the current status and desired goals of the program. The Acquisition Strategy defines the relationship between the acquisition phases and work efforts, and key program events such as decision points and reviews. The strategy must reflect the Program Manager’s understanding of the business environment; technical alternatives; small business strategy; costs, risks and risk mitigation approach; contract awards; the incentive structure; test activities; production lot or delivery quantities; operational deployment objectives; opportunities in the domestic and international markets; foreign disclosure, exportability, technology transfer, and security requirements; and the plan to support successful delivery of the capability at an affordable life-cycle price, on a realistic schedule. Acquisition Strategies are baseline plans for the execution of the program and should be prepared and submitted in time to obtain approval to support more detailed planning and the preparation of Requests for Proposal. The Acquisition Strategy is an approved plan; it is not a contract. Minor changes to the plan reflected in the Acquisition Strategy due to changed circumstances or increased knowledge are to be expected and do not require MDA pre-approval. Major changes, such as contract type or basic program structure, do require MDA approval prior to implementation. All changes should be noted and reflected in an update at the next program decision point or milestone. (2) Business Approach and Risk Management. The business approach detailed in the Acquisition Strategy should be designed to manage the risks associated with the product being acquired. It should fairly allocate risk between industry and the government. The approach will be based on a thorough understanding of the risks associated with the product being acquired and the steps that should be taken to reduce and manage that risk. The business approach should be based on market analysis that considers market capabilities and limitations. The contract type and incentive structure should be tailored to the program and designed to motivate industry to perform in a manner that rewards achievement of the government’s goals. The incentives in any contract strategy should be significant enough to clearly promote desired contractor behavior and outcomes the government values, while also being realistically attainable. When risk is Change 2, 02/02/2017 88 ENCLOSURE 2

DoDI 5000.02, January 7, 2015 sufficiently reduced, Program Managers will consider the use of fixed-price contracts when the use of such contracts is cost-effective. (3) Competition. The Acquisition Strategy will address how program management will create and sustain a competitive environment, from program inception through sustainment. Program management should use both direct competition at various levels and indirect means to create competitive environments that encourage improved performance and cost control. Decisions made in the early phases of the acquisition process can either improve or reduce program management’s ability to maintain a competitive environment throughout the life cycle of a program. Strategies to be considered include: competitive prototyping, dual sourcing, and a modular open systems architectures approach (MOSA) that enable competition for upgrades, acquisition of complete technical data packages, and competition at the subsystem level. This also includes providing opportunities for small business and organizations employing the disabled. (4) Intellectual Property (IP) Strategy and Open Systems Architectures. Program management must establish and maintain an IP Strategy to identify and manage the full spectrum of IP and related issues (e.g., technical data and computer software deliverables, patented technologies, and appropriate license rights) from the inception of a program and throughout the life cycle. The IP Strategy will describe, at a minimum, how program management will assess program needs for, and acquire competitively whenever possible, the IP deliverables and associated license rights necessary for competitive and affordable acquisition and sustainment over the entire product life cycle, including by integrating, for all systems, the IP planning elements required by subpart 207.106 (S-70) of the Defense Federal Acquisition Regulation Supplement (Reference (al)) for major weapon systems and subsystems thereof. The IP Strategy will be updated throughout the entire product life cycle, initially as part of the Acquisition Strategy, and during the Operations and Support Phase as part of the Life-Cycle Sustainment Plan. Program management is also responsible for evaluating and implementing open systems architectures, where cost effective, and implementing a consistent IP Strategy. This approach integrates technical requirements with contracting mechanisms and legal considerations to support continuous availability of multiple competitive alternatives throughout the product life cycle. (5) MOSA. Program management is responsible for evaluating and implementing a MOSA to the maximum extent feasible and cost effective. This approach integrates technical requirements with contracting mechanisms and legal considerations to support a more rapid evolution of capabilities and technologies throughout the product life cycle through the use of architecture modularity, open systems standards, and appropriate business practices. The Acquisition Strategy for the system should identify where, why, and how a MOSA will or will not be used in the program. b. Program Baseline Development and Management. The Program Manager is responsible for developing the APB. The APB (see section 4 in Enclosure 1 of this instruction) is a summary of the program cost, schedule, and performance baselines, and is the fundamental binding agreement between the MDA, the CAE (if applicable), the PEO, and the Program Manager. The Change 2, 02/02/2017 89 ENCLOSURE 2

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