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Happy Friday!
The big news this week is the final report of the PPBE Reform Commission, dropped on Wednesday with an in-person event featuring 10 of the 14 commissioners.
- They discussed their 28 recommendations, grouped into 5 buckets, and footstomped that the driving goal is to better align budgets to strategy.
- The biggest recommendation is a reconfiguration of the PPBE process into the Defense Resourcing System (DRS). It combines the programming and budgeting phases, and is composed of three processes: strategy, resource allocation, and execution.
- Some other recommendations address reprogramming, making new starts under continuing resolutions, working with Congress, and defense business systems.
- Here's a helpful two-pager of the recommendations.
Deputy Secretary of Defense Hicks released on the same day the Department's implementation plan based on the committee's interim report.
- It identifies five key recommendations (of the 13 near-term possibilities) and describes how DoD is aiming to -- or has already begun to -- move out on these. Among these are providing a midyear update briefing to Congress and consolidating budget line items.
If you're looking to hear some live discussion about the report, CSIS is hosting a virtual event today at 1000 EST, and GMU's Baroni Center for Government Contracting offer a hybrid event on March 14.
And of course, our symposium will be diving deep into this conversation, with a panel featuring commissioners Bob Hale and Arun Seraphin, plus Executive Director Lara Sayer, talking about where recommendations and implementation plans stand in another two months. You have some time to digest the report and bring your questions to Monterey!
- We also have several panels on related topics, including a panel on RAND's research on budget processes in other countries and organizations as well as another on financing defense innovation.
Our final point on PPBE reform is to recognize that research from NPS faculty and students informed a substantial part of the final report--as well as research written for and presented at last year's symposium.
In other acquisition news, House members have introduced a bill that would require agencies to notify individuals when government decisions are meaningfully influenced by artificial intelligence.
- This legislation may be relevant to the acquisition community as there is increasing talk of using AI to enhance contract writing, market research, evaluation, and other processes.
We have a number of international stories this week.
- China announced its defense budget for 2025, which has a 7.2% increase over the previous year for a total of $236.1 billion.
- The European Union announced its European Defense Industry Program, which means to encourage increased defense production by member countries and collaborative purchases that create efficiencies. The commission is inviting member states to spend at least 50% of their defense procurement budgets in the EU by 2030, and 60% by 2035. Current numbers show that EU states acquired more than 60% of their defense capabilities from the U.S.
- And Sweden officially joined NATO. The Swedish prime minister was recognized at the beginning of last night's State of the Union address, which also called for continued support to Ukraine.
Gen. Eric Smith, Commandant of the Marine Corps, returned to work this week, four months after his heart attack that has been attributed to, in part, a congenital heart defect that is now remedied.
And in NPS news, the latest issue of Contract Management magazine features two articles from NPS contributors.
- "What If? A Diverse Exploration of AI's Impact in Contract Use Cases" showcases research from three student teams advised by former NPS professor Dan Finkenstadt.
- And your humble editor is featured along with co-author Moshe Schwartz in "How Not to Alienate Business Partners," which considers reasons companies may not work with DoD, as well as potential solutions.
Finally, we celebrate award-winning thesis research on Replenishment at Sea from NPS student Navy Lt. Cmdr. Marianna Luporini--a topic that has clear relevance for current and near-future operations.
21st Annual Acquisition Research Symposium
Program is posted online!
Register now to join us for this action-packed two-day event.
This Week's Top Story
To keep pace, the Pentagon needs a new way to plan its budget
Robert Hale and Ellen Lord, Defense News
Will America be able to defend itself and support its allies in the next decade? Only if the Pentagon changes the processes it uses to allocate its funding.
The war in Ukraine, the threat of war with China in the Taiwan Strait, and continuing attacks on the American presence in the Middle East all raise questions about whether the United States can meet its defense obligations in one of the most complex geopolitical environments our nation has ever faced. ...
After two years of research and after hearing from more than 1,100 expert witnesses ranging from congressional members and staff to senior defense officials and industry experts, our final report is now available to the public.
The report lays out five major areas for reform designed to improve the alignment of budgets to strategy, foster innovation and adaptability, strengthen relationships between the DOD and Congress, modernize business systems and data analytics, and strengthen the capability of the resourcing workforce — with 28 actionable recommendations that will better enable our military to achieve its missions today and in the future. A few examples illustrate the scope and nature of our recommended changes:
Replace the PPBE process with a new Defense Resourcing System
Established in the 1960s, the PBBE process is no longer able to keep up with the pace of innovation and the complexity of growing national defense threats. Therefore, our commissioners reached consensus on a recommendation to create a new and streamlined approach called the Defense Resourcing System, dubbed DRS.
DRS consolidates the existing four-stage process into three interlocking stages: strategy, resource allocation and execution — to better align allocation of the DOD’s resources with strategic goals and to bring about more efficient resource allocation.
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