FRCSW/COMFRC Top News Clips ? December 5, 2016

Below are the FRCSW/COMFRC clips for the week of Dec. 5:   LOCAL COVERAGE

1. Leaders Discuss Logistics Challenges, Solutions during 2016 DOD Maintenance Symposium
2. Government Leaders Talk Depots at DoD Maintenance Symposium

WORLD/NATIONAL NEWS

3. Marine One Maintenance Jobs Not Coming to Jacksonville
4. The Moment Pilots First Realized the F-35 Was Something Extraordinary
5. Misleading F-35 Answers Drafted by Pentagon, Testing Chief Says
6. Air Force Seeks Virtual Elements in Flight Exercises to Heighten Realism, Complexity
7. U.S. Navy Aims to Buy More Boeing F/A-18E/F Super Hornets: Source
8. Innovation Drive Essential to DoD's Future
9. Defense Market Facing Major Transformation
10. Pentagon Hid Study Revealing $125 Billion In Waste
11. Post Expose on Pentagon Waste Draws Mixed Reviews
12. $125 Billion Savings Not So Fast, Say Experts, DoD, Rep. Smith

+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ WE'RE SOCIAL! Follow us on Twitter @COMFRC_Sustains, Facebook at http://facebook.com/COMFRC and YouTube at www.youtube.com/channel/UCKGMKvAQuJ_L6qnM0DZravQ   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ LOCAL COVERAGE +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Leaders Discuss Logistics Challenges, Solutions during 2016 DOD Maintenance Symposium   Albuquerque, N.M.-Readiness is the number one priority in Naval Aviation today, but aging aircraft, lack of resources and other challenges are inhibiting effective air operations across the U.S. Navy and Marine Corps. Supply, maintenance and logistics leaders outlined some of the problems and discussed the mitigating actions and potential solutions Dec. 7 at the 2016 DoD Maintenance Symposium.   As part of a panel of service component leadership entitled Senior Logisticians Roundtable, Rear Adm. Mike Zarkowski, Commander, Fleet Readiness Centers (COMFRC), pulled no punches in outlining the severity of the issues facing naval aviators and the support personnel striving to keep them airborne.   "We have a readiness gap across the TMSs [type/model/series]," Zarkowski said. "Every TMS has its own challenges and its own story. I will tell you, the challenges that we deal with every day at COMFRC are to try to close those gaps, to get those ready basic aircraft out of the depot and get them on the flightline."   Depot personnel are looking for ways to reduce the time aircraft spend undergoing in-service repairs (ISRs), trying to find quicker and more agile solutions. In keeping with total enterprise deployment, COMFRC leadership wants to ensure inclusion of the appropriate Level II Shore Maintenance Facilities.   On the journey toward those goals, several issues must be addressed. Zarkowski laid them out: chronic underfunding of enabler accounts; integrated resource management and training for artisans at the depot level and for Sailors and Marines on the flightline; increasing ISRs on aging aircraft; lack of technical data and structural repair manuals to effect repair at different levels; facilities degradation and lack of resourcing; inaccurate bills for material that cause delay to turnaround times at the depot; degraded material condition of aircraft; and supply issues.   COMFRC also has identified several concerning trends. One is the demand to push the aging F/A-18 A-D series aircraft to 6,000, 8,000 and even 10,000 flying hours. It takes extensive engineering analysis and workload planning to extend that life. In the meantime, because of the current gap in availability of those platforms as they transit through the depot pipeline, a more growing concern is the increase in utilization of F/A-18 E-F aircraft, resulting in logisticians and engineers looking at service life extension plans for that platform much earlier in its lifecycle then previously planned.   The same challenges exist on the Marine Corps side of Naval Aviation with the H-53. Because not enough inventory is available for missions, the B-22 is pushed into additional service. "The hours and material condition of those aircraft as they come into the depot are causing us concern, and we're experiencing increased turnaround time in our depot events because of usage and condition," Zarkowski said.   To get after the issues, COMFRC has introduced two methodologies. One, a Jonah methodology, takes teams from COMFRC and Naval Air Systems Command (NAVAIR) 6.0 and deploys them to Navy and Marine Corps flightlines to better understand undesirable effects. That approach has allowed for increased agility and a decrease in turn-around time while addressing immediate issues and improving readiness.   On the depot side, COMFRC personnel are returning to Critical Change Program Management. In the two years since roll out of this production management system, they have seen signs of success with increasing throughput and ready for training aircraft.   While the two methodologies address the tactical-level needs, COMFRC has strategic vision. Big-picture-wise, the sustainment system in Naval Aviation maintenance is behind the best business practices of today. The 30- to 40-year-old system has seen only marginal improvements. Zarkowski explained that while much has been done with Lean Six Sigma (LSS) and Theory of Constraints to improve efficiency, the field needs an overhaul.   "We need visibility," he said, adding that some initiatives underway involve supply optimization in which requirements come from a pull not a push. Other needs involve condition-based maintenance and big data. "We have 19 data sets right now, just at NAVAIR, that don't talk to each other . Lastly, we see this working very successfully at TRANSCOM [U.S. Transportation Command], [we need] an operations center where the right folks are empowered to make decisions with the right information" Zarkowski said.   Naval Aviation overall has already made strides in applying the use of some innovative tools and processes, such as additive manufacturing, to advance and sustain readiness and maintain its technological edge. Naval Aviation marked its first successful flight with a 3-D printed, safety-critical part in July 2016, when an MV-22B Osprey completed a test flight with a 3-D printed link and fitting assembly.   Now and in the future, the success of Naval Aviation demands an enterprise-wide participation from around the Navy, Marine Corps, wider government and the private sector.   Rear Adm. Vincent Griffith, director of the Defense Logistic Agency's (DLA's) operations (J3), also spoke on the panel, explaining how his organization is seeking improvements in support to the military services. One of the major efforts is the improvement of cost recovery. Every dollar DLA doesn't spend on overhead, service branches can spend on buying what they need from the agency such as tools, services and fuel.   Griffith said the way to get better is through collaboration, so DLA has a number of programs in place with its service partners as they look to become more efficient. To speed up processes, DLA is pushing the Time to Award initiative that uses LSS to reduce the time it takes to get a requirement onto contract.   All the efforts planned by other service components and Naval Aviation to improve readiness rely on finding the right people to fill the right jobs. Naval Aviation has made it a priority to attract, retain and develop members of its workforce (civilian and military) as well as to partner with industry. The private sector has a big role to play in continued 3-D efforts, as aviation leader's work toward putting greater 3-D printing capability into the hands of warfighters-giving them the ability to print required parts where they need them, when they need them.   Regardless of methodology or metric, the measure of success for all efforts across Naval Aviation will be readiness on the deckplates and on the flightlines.   The Naval Aviation Enterprise (NAE) is a cooperative partnership of Naval Aviation stakeholders focused on sustaining required current readiness and advancing future warfighting capabilities at best possible cost. It is comprised of Sailors, Marines, civilians and contractors from across service branches and organizations, working together to identify and resolve readiness barriers and warfighting degraders.   For more information about the Naval Aviation Enterprise, please visit www.nae.navy.mil   For more news from Naval Aviation Enterprise, visit www.navy.mil/local/NAE.   For more information, visit www.navy.mil, www.facebook.com/usnavy or www.twitter.com/usnavy.   http://www.navair.navy.mil/index.cfmfuseaction=home.NAVAIRNewsStory&id=6438   (return to top) +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Government Leaders Talk Depots at DoD Maintenance Symposium   Albuquerque, N.M.-The health of depots is crucial to our nation's sustainment and readiness, but lack of funding, confused requirements and ineffective communication among stakeholders is threatening them, according to a panel on Title X funding held Dec. 5 at the DoD Maintenance Symposium.   Rear Adm. Mike Zarkowski, Commander, Fleet Readiness Centers (COMFRC), stressed early on during the event that partnerships are going to be key to keeping depots on track.   "Whether you're uniformed, whether you're civil service or whether you're a contractor (or OEM [original equipment manufacturer]), these are the three legs of our milking stool that have been providing readiness in defense of this country most especially since 2001 and beyond," he said.   COMFRC's mission is to produce quality airframes, engines, components and support equipment, and provide services that meet the Naval Aviation Enterprise's aircraft ready-for-tasking goals with improved effectiveness and efficiency.   Successful partnerships among Navy organizations, the wider government and the private sector are helping to ensure the various FRCs are able to meet their mission requirements. Private partnership is especially important at the depot level, with up to half of all work done by contractors. Naval Aviation is partnering closely with industry to solve readiness challenges, using readiness on the deckplates and flight lines as its driving measure of success.   To stay on track, COMFRC has set two strategic initiatives: Be ready to fight tonight; and keep our mind on the future. The Navy has many readiness challenges and gaps across its enterprise. Addressing the gaps requires adequate sustainment planning as well as the use of innovative tools and processes to advance readiness and sustain readiness, ensuring Naval Aviation maintains a technological edge. To complicate matters, personnel are dealing with aging facilities and aircraft while simultaneously having to keep the most technically advanced aircraft in history up and running.   "If the balloon goes up tonight, do we have enough aircraft with enough hours to answer the call" Zarkowski posed to the attendees.   Fellow panelist Mark Van Gilst, director of logistics, Office of the Deputy Assistant Secretary of the Air Force for Logistics and Product Support, had some words of wisdom to impart to his Navy and other colleagues. The U.S. Air Force is the only service branch to violate Section 2466 (also known as the50/50 rule, a U.S. Code that mandates not more than 50 percent of each military department's annual depot maintenance funding can be used for work done by private sector) twice. To avoid ever going through that pain again, they've made what Van Gilst called a "sea change."   To start, the Air Force consolidated two departments and placed them under the Secretary of the Air Force for Acquisition. "If we're not in compliance, the Secretary of Acquisition has to go talk to Congress," Van Gilst said.   Program managers are now at the center of compliance, and planning is done upfront, a major change for the Air Force. Sustainment conversations have moved from the back third of all briefs to the front third, underscoring how it has grown in importance. The Air Force also worked to become more efficient. For example, resource expenditure is sometimes measured in dollars, sometimes in hours, depending on the policy driving certain measures. But the same number of hours in different aircraft can have very different costs. At the same time, through their earlier mistakes, "one lesson we also learned is when you get close to a violation, it's very hard to turn the Titanic," Van Gilst explained. "So you end up doing things that aren't smart." To compensate, The Air Force is making more decisions from a total business perspective.   However, being efficient is challenged by cumbersome regulation. Panelist Vickie Plunkett, a House Armed Services Committee professional staff member told the audience that the new National Defense Authorization Act (NDAA) has more than 3,000 pages and 100 new acquisition provisions, not including several for small businesses.   "For every reporting requirement that we repealed, we probably added two more," Plunkett said. The NDAA does leave depot statutes in place, which she explained means Congress is willing to bear the cost of sustaining and supporting these facilities, but the challenge lies in determining the sufficient level of funding.   Legislators, and the military, also grapple with ensuring policy keeps up with technology and the ability to sustain adequate depot capabilities so that they remain a ready and controlled source of repair. The 50/50 is meaningless without funding. "Fifty percent of nothing is nothing," Plunkett said. Later adding that, "Setting and validating requirements for depot-level maintenance and other sustainment needs has always been a weak link in the process."   Congress has started to pay more attention, but there is still work to be done to convince some members that planning for sustainment should be done earlier in the process. The Defense Department hurts its own cause in some cases by not providing clear objectives, milestones and resources for items such as the product support manager career path. Even the delineation of program manager responsibilities versus those of product support managers is murky.   What is clear is that a skilled, competent workforce is critical to depot success, so the Fiscal Year 17 NDAA provides several new direct-hire authorities. Not everyone is convinced this will help the manpower shortage, but Plunkett believes there are areas of untapped recruitment among unemployed or underemployed skilled workers in various trades. Through all the methods available to it, Naval Aviation is committed to attracting, retaining and developing members of its maintenance workforce.   She also believes the military must better communicate policy needs to other stakeholders in the sustainment community, with access to technical data rates playing a key role in the sustainment life cycle. Explaining that all the changes in the new NDAA are very complicated, Plunkett closed by sharing that some options for sustainment are no longer available, and having everyone on the same page is important because history has shown how "foregone conclusions" have been extremely costly.   The Naval Aviation Enterprise (NAE) is a cooperative partnership of Naval Aviation stakeholders focused on sustaining required current readiness and advancing future warfighting capabilities at best possible cost. It is comprised of Sailors, Marines, civilians and contractors from across service branches and organizations, working together to identify and resolve readiness barriers and warfighting degraders.   For more information about the Naval Aviation Enterprise, please visit www.nae.navy.mil.   For more news from Naval Aviation Enterprise, visit www.navy.mil/local/NAE.   For more information, visit www.navy.mil, www.facebook.com/usnavy or www.twitter.com/usnavy.   http://www.navair.navy.mil/index.cfmfuseaction=home.NAVAIRNewsStory&id=6435 (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ WORLD/NATIONAL NEWS +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Marine One Maintenance Jobs Not Coming to Jacksonville   Jacksonville, FL - The Navy will not be moving Marine One helicopter maintenance duties to Jacksonville. For months, it's been reported that maintenance for Marine One would be moving from Sikorsky in Connecticut to the Fleet Readiness Center at NAS Jax.   However, First Coast News has learned that move will not happen.   "Lockheed Martin and the Navy came to an agreement to keep the SPAR (Special Progressive Aircraft Rework) work with Sikorsky in Stratford, Conn.," said Paul Jackson, a spokesman for Sikorsky.   According to Jackson, talk about moving the maintenance contract to Jacksonville happened after Sikorsky failed to reach an agreement with the Navy in July.   Negotiations to keep the work in Connecticut continued between the Navy and Lockheed Martin.   "While those discussions were ongoing, NAVAIR still needed to ensure that regularly scheduled SPAR maintenance would continue without interruption, so they pursued a parallel plan to conduct SPAR work at the Fleet Readiness Center Southeast," Jackson said.   Sikorsky, a division of Lockheed Martin, has worked on the presidential chopper for the past 4 decades according to congressional leaders who fought to keep the maintenance contract in the northeast.   Some of Connecticut's congressional delegation, including Sen. Rich Blumenthal (D-Conn) who service on the Senate Armed Services Committee, wrote a letter to the Secretary of the Navy on August 22.   "We strongly urge you to suspend any relocation until a thorough review of all direct and indirect costs of any relocation are made," the letter said.   The letter says there were 85 workers who performed maintenance on the fleet described as "difficult and costly to maintain."   Days later though, the Fleet Readiness Center told our news partner The Florida Times Union on September 5th they were getting ready for Marine One.   "We are definitely in preparations to take on the work load, so that's the intention and if we are chosen then we will be performing that maintenance," said Terresa White.   On November 7th, more than two months later, Sikorsky and the Navy agreed to a new maintenance agreement for the Presidential helicopter fleet.   http://www.firstcoastnews.com/news/marine-one-maintenance-jobs-not-coming-to-jacksonville/365001610   (return to top) +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   The Moment Pilots First Realized the F-35 Was Something Extraordinary   2016-12-06 By Todd Miller   Statistics, Milestones, Capabilities, Flight characteristics, Test protocols, Cost, Software blocks. It is easy to get lost in the complexity of the F-35 program.   The combined F-35 fleet now has over 75,000 flight hours, yet for many there remains a lack of understanding. Much of this can be expected given many of the F-35s capabilities are classified.   This is compounded by the reality that many do not grasp the war the F-35 was designed to deter - or fight.   Aerial warfare of the 21st century is not anticipated to consist of within visual range (WVR) dogfights, but rather the prevailing aircraft will dispatch its adversary without even being detected. 21st Century Warfare is defined by new terms; "Information Dominance," "Full Spectrum Dominance," "Distributed Lethality," "The Kill Cloud/Kill Web."   This warfare has about as much in common with wars of the past as your 1970's land line has to your smartphone.   It is in this battlespace that the F-35 is designed to fight and to do so with a distinctly unfair advantage. To understand the significance and value of the F-35, and whether "it works" or not, cut through the complexity and noise. Simplify. Put aside the politicians, the ideologues, the self-proclaimed experts and listen to the voice of the pilots.   The pilots will take the aircraft into combat, their own lives in the balance as they penetrate contested space and are likely to be outnumbered by adversary aircraft.   Second Line of Defense and a handful of journalists recently had the opportunity to visit with four such pilots during a "Proof of Concept" demonstration on the USS America, November 19, 2016.   The four pilots are some of the most experienced F-35B pilots in the United States Marine Corps (USMC); George "Sack" Rowell, Commanding Officer (CO) of VMX-1 (Marine Operational Test & Evaluation Squadron).   Prior to the F-35, Rowell spent appx. 3000 hours over 18 years of flying the F/A-18 Hornet. Previously the CO of VMFA(AW)-533 Col. Chad "Mo" Vaughn, CO of VMFA-211. Prior to the F-35, Vaughn spent a couple 1000 hrs over 13 years in the F/A-18A-D Hornet, as well as time in the F-16A-B Fighting Falcon/Viper and F/A-18 Super Hornet at NAS Fallon.   Col. Rich "BC" Rusnok, slated to become the CO of VMFA-121 in March 2017. Prior to the F-35, Price spent appx. 7 years flying the AV-8B Harrier II with additional time in the F/A-18 Hornet.   Col. John "Guts" Price, slated CO for VFMA-122 (2018). Prior to the F-35, Price spent appx. 1200 hrs and 10 years flying the AV-8B Harrier II, and has about 400 hrs in the F-35 over the past 3 years.   The comments have been edited for readability with best efforts made to maintain context and integrity of intent.   As you look at the F-35s combat capabilities, what two things really mark it as either a superior or inferior weapon compared to what you have previously flown   Mo: The closer you get to the airplane, the more positive you are about it.   The airplane provides awareness of what is going on around you. All around you. It is second to none. I tell people this all the time.   I cannot tell you how awesome the sensor suite is, combined with the survivability of the airplane.   It's not just that it is a stealth airplane, it is everything rolled into one.   It makes it unlike any other plane anywhere in the world right now.   BC: Stealth works. Low observability is not a fallacy.   You see it in the airplane and realize what a powerful capability it is.   None of the airplanes we flew prior had that capability.   To echo what Mo said, the situational awareness (SA), the fusion piece of it stands out.   In Gen 4 aircraft the pilot is the fusion engine, what's in between your ears is what's making that fusion happen. To some degree that's still true, the human is a major part of this weapons system.   However, the aid that the fusion system gives a pilot to make high level decisions, coupled with situational awareness well beyond what was had before - that's what makes it a game changer.   Guts: Situational awareness and the freedom of maneuver that stealth brings. The workload required to have that unprecedented SA is greatly reduced over previous platforms.   I'm getting all this information, I have freedom to maneuver, and I work significantly less than I did in a previous platform to have that level of information.   That frees up my processor to be able to fight the battle vs. each individual part that I used to have to put together.   The workload is reduced in all aspects of flight, and that enables me to focus on the fight at hand.   Mo: The aircraft allows me to be a tactician, rather than worry about physically manipulating sensors to get information I need.   I have a good picture that I can execute tactically.   It is almost like a chess game.   I can make sure the moves I make in the cockpit are the best moves not just for me, but for everybody out there. Can you talk a little about the AEGIS Integration   BC: The synergistic effects of other platforms, especially powerful platforms like the AEGIS combat system not only makes us that much more effective, they have phenomenal SA, phenomenal power and a phenomenal weapons suite.   Sometimes we may not be in the right position, or be the best shooter - but now we can work synergistically with AEGIS and figure out that big picture.   Then we can share all that onboard information to other platforms that may or may not have the same capabilities. The integration makes us that much more effective.   We came in with Naval Sea Systems Command (NAVSEA), Industry, Big Navy to perform a demonstration in September out of White Sands, NM. The F-35 performed an engagement with that combat system through a gateway that allowed us to talk via Multifunction Advanced Data Link (MADL) to the AEGIS combat system and engage the target.   We talked electronically to the AEGIS combat system, like a remote sensor, and AEGIS engaged the airborne target successfully.   And when I say engaged successfully, it was a metal on metal engagement from a significant range. I'd say more than a tactically significant range. It was a very, very impressive shot.   That was not something we did here at sea, [it was done in September] that was a developmental test, a proof of concept, but it gives us an idea of what we can do to plug the F-35 into the bigger picture.   Can you talk about the interface for that kind of targeting   BC: It is super simple.   It is targeting the way we target any of our own weapons and it is passed off.   There is really no difference, it is just a battle management issue as to who is going to engage.   Can you describe what the F-35 allows you to do from a tactical perspective that the 4th Gen platforms could not do   Mo; The sensors on the airplane are our center of gravity. Our ability to know what's going on around us in the battlespace and then push that to everybody we are working with.   Not just air to air (A2A), but air to ground (A2G) as well. Add our ability to operate in areas that we have never been able to before such as contested environments.   Physically flying the airplane is extremely easy, that's the beauty of it, so you just focus on the tactical employment.   It makes you much more lethal.   Is it fair to say that your missions can become more dynamic than with Gen 4 platforms, such as loiter, gather information, be more flexible as a pilot with your mission   Mo: The F-16 and F/A-18 are extremely capable platforms and they do the swing role /multi role mission very well.   However, they are going to struggle vs Anti-Access/Area Denial (A2/AD) or IADS, and in those cases they will be on a dedicated mission. We do have a lot more flexibility to flip flop missions, and we do it a lot in training. We will escort a package on a strike mission and then we will break off do some A2G, or suppression of enemy air defenses (SEAD), perhaps some Combat Air Patrol (CAP) or dynamic targeting in the target area - then we'll rejoin the package and come out with everybody.   Especially along with the F-22, we'll open the door, wait while everyone else comes in and completes their mission, then come out with the package and close the door behind us.   We do some different things.   As Marines we are on call for a number of different missions, close air support (CAS) etc. that we could not have done in one airplane.   The Marines are writing the CAS Manual for the F-35. How are you finding the F-35 in that role compared to what you have now   Price: In the CAS role it is performing well. Being a new aircraft there are some capabilities we'd like to continue working on, but the basic execution of CAS is "On Time, On Target."   The jet is more than capable to execute that.   The unique capability it brings is executing CAS in the presence of a wide range of threats (something I could not do with previous platform).   Can you give me an example   Traditionally (Gen 4) if we are executing CAS and a medium range surface to air missile (SAM) pops up on the battlefield, we are done with CAS.   We immediately transition into a SEAD, destruction of enemy air defense (DEAD), or reactive SEAD mindset. With the F-35, we may continue to execute CAS because of freedom of maneuver (stealth) and the SA I have about the threat, its location and its nature.   I may advise the forward air controller (FAC) that a threat has appeared, but it won't impact mission execution. If the situation gets more threatening, I have the organic capability to go deal with the threat and then roll right back into CAS. Previously I would have to call in another platform, potentially call in our Prowlers or call in other combined arms to take care of the threat.   The F-35 enables a wide array of CAS execution in a wide array of environments, so from the low-end threat spectrum to the high-end threat spectrum I am capable of executing any of those missions. Mo: We have greater all weather capability.   The synthetic aperture radar (SAR) maps give the capability to see through weather and deploy ordinance through the weather from a significant stand-off distance (or in proximity).   The ability to employ ordinance through the weather with high quality targeting is impressive.   I know every guy up here and myself included, we take a lot of pride in the fact of our CAS.   There's been much said about the airplane in the CAS role, some good, some bad, but to us it's important that a lot of that goes back to the man/woman in the cockpit and the fact that it says Marines on the back of the airplane.   It means the guys in need of CAS are going to get a level of support consistent with what they've had out of the Hornets, Harriers and all the airplanes we've flown before.   We all take pride in that.   We're going to give you a lot more capabilities, but it is the fact that we are Marines, and Marines is written on the aircraft - that makes it very important to us up there.   Thinking about the electronic warfare (EW) suite and its ability to detect waveforms and come up with countermeasures.   How do you interface with that as a pilot, is it something you make decisions about, or is automatic Mo: Without getting into the technical details it is very, very simple for us.   The way the jet is set up, we make a move to execute electronic attack and the jet will take care of it.   On a personal level as pilots, coming from other platforms and stepping into the F-35, do you have an "aha" moment that you can share   Guts: My first "aha" moment was a seemingly simple thing.   I was executing a familiarization flight near MCAS Yuma. I was coming back to the airfield and I basically just turned the jet and pointed its nose at Yuma.   Immediately the jet is providing me the information of all the traffic that is out there in the airspace. When I talk to approach for the first time they are telling me about the traffic that is out there that I already know about and I see it.   I can tell who everybody is that he is talking about and the jet also saw traffic that ATC hadn't seen yet and I asked about it. And I thought, "holy cow," here I am coming back to the field from a simple familiarity mission and my jet is telling me everything about the operational environment I am about to go into.   In this case, something very simple, the traffic pattern coming back there, but I didn't have to do anything to have that level of SA.   I can start making decisions about what altitude I wanted to go to, if I wanted to turn left or right, speed up or slow down.   There's somebody coming up next to me, I want to get in front of them - or whatever.   It is a very simple example, but I thought WOW this is amazing that I see everything and can do that.   The other was the first time I vertically recovered the airplane. The flight control law that the airplane has is unbelievable and I always tell the anecdote. Flying AV-8B Harrier IIs, I only had one specific aircraft I felt like I could kind of go easy on the controls and it would sit there and hover.   I love the Harrier, love flying that aircraft, but there was work involved to bring it back for a vertical landing. The very first time I hovered an F-35B I thought, I am the problem here, and I am just going to let the jet do what it wants to do.   The F-35 was hovering better than I could ever hover a Harrier without doing a thing. That's back to that workload comment I said earlier. I am performing a vertical landing, and I have the time to look around and see what is taking place on the pad and around me. It is a testament to the jet.   BC: I was conducting a strike mission and Red Air was coming at me. In a 4th Gen fighter you must do a whole lot of interpretation. You see things in azimuth, and you see things in elevation. In the F-35 you just see the Gods eye view of the whole world. It's very much like you are watching the briefing in real time.   I am coming in to perform the simulated weapons release, and Red Air is coming the other direction.   I have enough situational awareness to assess whether Red Air is going to be a factor to me by the time I release the weapon. I can make the decision, I'm going to go to the target, I'm going to release this weapon.   At the same time I pre-target the threat, and as soon as I release the A2G weapon, I can flip a switch with my thumb and shoot the Red Air.   This is difficult to do in a 4th Gen fighter, because there is so much manipulation of systems in the cockpit. All while paying attention to the basic mechanics of flying the airplane and interpreting threat warnings that are often very vague, or only directional.   In the F-35 I know where the threats are, what they are and I can thread the needle. I can tell that the adversary is out in front of me and I can make a very, very smart decision about whether to continue or get out of there. All that, and I can very easily switch between mission sets.   Mo: I was leading a four ship of F-35s on a strike against 4th Gen adversaries, F-16s and F/A-18s. We fought our way in, we mapped the target, found the target, dropped JDAMs on the target and turned around and fought our way out.   All the targets got hit, nobody got detected, and all the adversaries died. I thought, yes, this works, very, very, very well.   Never detected, nobody had any idea we were out there.   A second moment was just this past Thursday. I spent a fair amount of my life as a tail hook guy - [landing F/A-18s on US Navy Supercarriers] on long carrier deployments.   The last 18 seconds of a Carrier landing are intense. The last 18 seconds of making a vertical landing on this much smaller USMC Assault Carrier - is a lot more relaxed.   The F-35C is doing some great stuff. Making a vertical landing [my first this week] on the moving ship, that is much smaller than anything I've landed on at sea - with less stress, was pretty awesome.   Sack: It was my first flight at Edwards AFB Jan '16. I got in the airplane and started it up. I was still on the deck and there were apparently other F-35s airborne - I believe USAF, I was not aware. I was a single ship, just supposed to go out and get familiar flying the aircraft.   As the displays came alive there were track files and the SA as to what everyone else was doing in the airspace, and I was still on the ground. I mean, I hadn't even gotten my take-off clearance yet.   I didn't even know where it was coming from. It was coming from another F-35. The jet had started all the systems for me and the SA was there. That was a very eye opening moment for me.   The second one, took place when I came back from that flight. In a Hornet you would pull into the line and had a very methodical way in which you have to shut off the airplane and the systems otherwise you could damage something.   So you have to follow a sequence, it is very methodical about which electronic system you shut off. In the F-35 you come back, you do a couple things then you just shut the engine off, and it does everything else for you. Sounds simple, even silly - but it is a quantum shift.   The voice of the pilots is clear.   The F-35 is a platform with the ultimate level of sophistication, made simple.   And therein lay the beauty of the F-35, and just why it will be so deadly: it's simple.   http://www.sldinfo.com/the-moment-pilots-first-realized-the-f-35-was-something-extraordinary   (return to top) +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Bloomberg   Misleading F-35 Answers Drafted by Pentagon, Testing Chief Says   by Anthony Capaccio   Pentagon officials have been preparing a misleading assessment of progress on Lockheed Martin Corp.'s F-35, the costliest U.S. weapons program, the Defense Department's chief tester warned.   "If not changed, the existing responses would at best be considered misleading and at worst, prevarications," Michael Gilmore, director of operational test and evaluation, wrote in an internal memo criticizing the draft response to questions about F-35 testing from Senate Armed Services Committee Chairman John McCain.   Gilmore's memo is the latest example of his vocal doubts about the F-35's performance in key tests. His critiques are at odds with the Pentagon's narrative that the program is on course after earlier problems. President-elect Donald Trump and his defense secretary -- he's nominating retired General James Mattis -- will have to decide next year whether to increase F-35 production to 70 in fiscal 2018 from 63 this year, as requested by the Defense Department.   Trump, who on Tuesday complained that the cost of thenew Air Force One being built by Boeing Co. "is totally out of control," has also raised some questions in the past about the F-35. In an October 2015 interview with radio host Hugh Hewitt, Trump criticized the fighter's cost and said he heard "that it's not very good" and that "existing planes are better."   McCain's Disappointment   In a Nov. 3 letter to departing Defense Secretary Ash Carter, McCain, an Arizona Republican, said he was "extremely disappointed to learn of another delay" in the $57 billion development and demonstration phase of the F-35 "with an associated cost overrun that may be upwards of $1 billion."   Several of the answers in the draft response to McCain "ignore acknowledged facts, are ambiguous and misleading and if signed and sent as-is" could "generate substantial issues with the Congress," Gilmore wrote to Frank Kendall, undersecretary of defense for acquisition, in the Nov. 28 memo obtained by Bloomberg News.   The draft answers should "be revised to provide clear, accurate and complete answers," said Gilmore, who also raised concerns about the F-35 in a Nov. 18 letter to Deputy Defense Secretary Robert Work.   Gilmore "has shared his concerns" with Kendall who "has them for advisement in his response to Senator McCain," spokesman Mark Wright said in an e-mail. Navy Lieutenant Commander Courtney Hillson, a spokeswoman for Work, said in an e-mail that Gilmore's information "was and continues to be used to help senior leaders make informed decisions."   Assertions Challenged   Gilmore challenged passages in the Defense Department's draft response to McCain that assert:   .The F-35's development phase is due to end in "early 2018." Gilmore said the department should "state clearly that development flight testing will not complete -- at the earliest" -- until mid-2018.   .Operational combat testing that all weapons systems must pass will start in mid-2018 and be completed a year later. Gilmore labeled that "false." Instead, he said the tests will commence "no sooner than late 2018, or, more likely, in early 2019 but could be as late as 2020."   .An Air Force certification to lawmakers that F-35s delivered in fiscal 2018 will have full combat capability remains "valid." Gilmore said that is "highly unlikely" because of delays in testing the critical final version of the plane's software and correcting 276 pending deficiencies.   Live-fire testing of the jet's gun system for attacking ground targets and in dogfights against enemy jets faces new delays, Gilmore said. In flights last month, symbols on the helmet display used by pilots to aim air-to-ground attacks were "unusable and unsafe to complete the planned testing."   F-35 Office's Comment   Joe DellaVedova, spokesman for the Pentagon's F-35 program office, said in an e-mail that "there have only been a couple of flights" where the stability issue "was apparent, and the flight test data is still under review to determine root cause." Additional improvements were incorporated in a software update released in November, and pilot evaluations are planned.   Concerning the development phase's status, DellaVedova said the program office and Lockheed continue "to drive toward the completion of the test program, including solutions" for the issues cited by Gilmore. The program intends to complete all the flight-testing of the most capable software by late 2017, with delivery of the capability to deployed aircraft from late 2017 to spring 2018, he said, although the schedule could slip about three months.   Wingtips, Helmets   The Navy's version of the plane, the F-35C, also has inadequate wing strength, Gilmore said. Its wingtips aren't strong enough to carry the AIM-9X short-range air-to-air missile, a primary weapon, at some altitudes and airspeeds. Testing on a fix is under way.   "This is a serious deficiency that would have restricted" F-35C flight with the missile, Army Major Roger Cabiness, Gilmore's spokesman, said in an e-mail. The initial defect reports on the structural weaknesses surfaced in 2013 "so the Navy is not just learning about it, but the proposed fixes are just now being implemented," Cabiness said.   In addition, "excessive F-35 vertical oscillations," or shaking, in catapult launches from aircraft carriers must be resolved, Gilmore said.   The Navy has identified the shaking as a "must-fix deficiency'' but "the program waited so long to take action that it is unlikely a solution can be implemented within" the development phase "unless a quick fix is developed soon," Cabiness said.   Rear Admiral Roy Kelley, director of the Navy's F-35C integration office, said in an e-mail that "we are confident that the program will address discrepancies found and aggressively pursue the fixes." Kelley said the development phase "has identified a few F-35C specific discrepancies, to include the load limitations for carriage of AIM-9X, as well as the vertical oscillations during catapult launch."   A potential fix for the wingtip limitations "has already been implemented with the modification of the outer wing panel on F-35C," Kelley said.   https://www.bloomberg.com/news/articles/2016-12-07/misleading-f-35-answers-drafted-by-pentagon-testing-chief-says-iwerk3w8   (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Defense News   Air Force Seeks Virtual Elements in Flight Exercises to Heighten Realism, Complexity   By: Valerie Insinna   ORLANDO, Fla. - With live training alone unable to provide the complex scenarios meant to push the F-35 to its limits, the US Air Force is banking on a suite of cutting-edge technologies that will fuse virtual and constructive elements into live exercises.   The Air Force Research Laboratory (AFRL) is about halfway through the technology demonstration phase of the Secure Live, Virtual and Constructive Advanced Training Environment (SLATE) program, which will secure the technologies needed to give pilots as close of an experience as they can get to an actual battle.   The program is set to begin demonstrating the system aboard F-15E Eagles and Navy F/A-18s in 2018, but the technology probably won't be ready for the F-35 and other fifth-generation aircraft until the mid 2020s, said Maj. Gen. Robert McMurry, AFRL commander.   "We've learned over the past that our training systems are not up to the task that we have," he said during a Nov. 29 keynote speech at the Interservice/Industry Training, Simulation and Education (I/ITSEC) conference in Orlando. "The cost of bringing live training environments and exercise environments to the level of fidelity that we really need to simulate what we would expect to be a conflict environment is probably cost prohibitive."   Live, virtual and constructive (LVC) training has become a buzzword in the simulation industry over the past couple years, but SLATE is not about merely developing the capability for LVC assets to train together, said Dave "Moses" Noah, SLATE program manager at AFRL. A true LVC environment uses virtual and constructive elements to make live training as realistic as possible, enabling highly complex and advanced scenarios.   When the Air Force conducts live training today, there are elements of make believe that keep the pilot from having a truly immersive experience. For instance, an F-15E flying against an F-16 functioning as an aggressor aircraft will still see an F-16 on its radar shooting American weapons, he told Defense News.   But once SLATE is integrated into the fleet, that F-15E will be able to see the F-16 as a MiG-29, or any other adversary aircraft, on all of its sensors and displays. The idea is to more accurately replicate the conditions of battle, including simulating various environments, adversary weapons and other systems not in the US inventory.   "When we take off, go around the area and point at each other, I have the radar cross section signature of a MiG-29, I have all of the radar emissions of a MiG-29, so when I lock him up, he doesn't see on his radar warning receiver a symbol for an F-16. He sees a MiG-29," Noah said.   "The first time that he knows that I'm not a MIG-29 is finally, at let's say 2.1 miles, gets a visual on me," he said. "Up until then, he doesn't know."   AFRL is overseeing the development of three key technologies for the program: a radio waveform that can manage the unprecedented throughput of data between the different LVC assets, high-level data encryption that keeps sensitive information like radar signatures from proliferating, and a multi-level security system that allows different data to be passed to US and international assets depending on the level of classification.   The waveform, called the Fifth Generation Advanced Training Waveform (5GATW) has been fully developed by Massachusetts Institute of Technology's Lincoln Laboratory and performed final flight tests in September, Noah said. During the tests, Lincoln Labs stressed the waveform by passing as much data as possible between ground stations and two aircraft, an L-29 and Dassault Falcon 20 owned by the labs.   Cubic is responsible for the rest of the system, including creating the encryption and security architecture as well as manufacturing a software-defined radio about the size of a smartphone capable of managing and processing the 5GATW, said Mike Knowles, vice president of air ranges. It's also making the ground support system that will provide connectivity between the LVC elements.   Over the upcoming months, the company will integrate those technologies - along with an antenna, power amplifier and a processor - together into a pod that will be attached to fourth-generation aircraft.   "Inside our labs as systems integrator in San Diego, we're already putting together the software-defined radio, the waveform we integrated, the multi-level secure architecture and the ground station," he said. "So in our lab now, we're at the point where we can do simulated connectivity of the system, so we can test out and verify the communications. The encryption system is already under the NSA [National Security Administration] process for certification."   During I/ITSEC, the company showcased some of the systems that will be encapsulated into the pod, which will be about the size of an AIM-9 Sidewinder missile. For fifth-gen jets like the F-35 and F-22, more engineering will be required to internally install the capability, preserving its low observability. That's not a part of SLATE's technology demonstration phase and will be done later on when the service starts an acquisition program, but Cubic has proposed some ideas to AFRL on how the core systems could be integrated into the joint strike fighter (JSF).   "For JSF, it's not going to be that hard. [For] a lot of the SLATE components, the hardware is designed to be able to be able to port into JSF in the future," said Tim Cockerham, a senior principal systems engineer for Cubic. For instance, some of the technologies used for SLATE could replace older processors or other subsystems that are larger in size.   The Air Force has committed $49 million for the technology development phase, and the Navy plans to add about $20 million of its own funds.   AFRL and Cubic are going to continue testing and developing SLATE over the next year. Three two-week demonstrations at Nellis Air Force Base, Nevada, which will include Navy participation, are planned in 2018, Noah said.   The first demo, planned for March, involves a couple F-15Es and F/A-18s interfacing with some virtual and constructive players.   "We're just making sure we have connectivity out on the range at Nellis," he said.   Another demonstration in May increases the number of actors and the influx of data being exchanged. The capstone event in October will take it up yet another notch: up to 16 live aircraft acting as blue forces, additional live aggressor forces, and then "a classified number" of virtual and constructive forces.   "But it's going to be a lot because we want to show how much the system can handle," he said.   Future Acquisition   Once technology development ends, it will be up to the service to spin SLATE into a competitive program of record. That's not exactly an easy thing to do in this fiscal environment for a capability that will cost billions, and possibly tens of billions, Noah said. However, the service's Life Cycle Management Center, the acquisition arm of Air Force Materiel Command, has designated employees to help ensure a smooth transition.   "They come to work in our building just to be joined at the hip with what AFRL is doing with SLATE," he said.   AFRL is already engaged in regular meetings with Air Combat Command - which has been designated the lead command for LVC platforms - and with Lynda Rutledge, the program executive officer for the agile combat support directorate, who is in charge of acquiring simulators.   The acquisition strategy has not been finalized, but "this is going to be multiple programs of record because LVC is so huge," he said.   http://www.defensenews.com/articles/air-force-seeks-virtual-elements-in-flight-exercises-to-heighten-realism-complexity   (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   U.S. Navy Aims to Buy More Boeing F/A-18E/F Super Hornets: Source   (REUTERS 4 DEC 16) ... By Andrea Shalal | SIMI VALLEY, Calif.   The U.S. Navy plans to divest its older model Boeing Co (BA.N) F/A-18 Hornet fighter jets in coming years and hopes to buy dozens of F/A-18E/F Super Hornets to deal with a shortfall of strike fighters aboard its carriers, a Navy official said.   The plan, which is still being finalized, could be implemented as early as part of the fiscal 2018 budget, said the official, who was not authorized to speak publicly.   "To decrease the strike fighter shortfall and to best prepare future air wings for likely threats we will soon divest from legacy Hornets, look to buy several squadrons worth of Super Hornets and continue with efforts to bring on the F-35 carrier variant," said the official.   The Navy also plans to field and deploy a new unmanned carrier-based refueling plane, the official said. Sources familiar with Navy plans say delays in the fielding of the carrier variant of the Lockheed Martin Corp (LMT.N) F-35 fighter jet, longer-than-expected maintenance times for older model Hornets, and higher usage rates have left the Navy facing a shortfall of about 70 fighter jets in coming years.   If implemented, the plan would provide dozens of new orders for Boeing and keep its St. Louis production line running for several more years.   "We would welcome an opportunity to develop a plan, with the Navy, that would allow us to continue providing the robust capabilities of the Super Hornet well into the future," said Boeing spokesman Todd Blecher.   The company had suffered a setback last month when Congress failed to include 12 Super Hornets in the fiscal 2017 defense authorization bill, opening a potential gap in the Boeing production line until several foreign orders for Kuwait and Canada are finalized. The $618.7 billion bill was passed Friday by the U.S. House of Representatives, and the Senate is expected to vote on the measure next week.   Navy officials say the jets could still be added to the fiscal 2017 budget as part of a supplemental budget that lawmakers are urging Republican President-elect Donald Trump to submit after he takes office.   Republicans, who will control both houses of Congress and the White House after Trump is sworn in on Jan. 20, see good prospects for raising military spending levels and scrapping a 2010 law that imposed mandatory cost caps on defense spending.   The older model Hornets could be transferred to the Marine Corps, which has faced its own maintenance issues, including a lack of spare parts.   http://www.reuters.com/article/us-boeing-fighters-idUSKBN13T05S (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Innovation Drive Essential to DoD's Future   (DEFENSE NEWS 05 DEC 16) ... Secretary Ash Carter   At my swearing-in ceremony as secretary of defense, I said the Pentagon had to "think outside this five-sided box," and since taking office, opening the Defense Department to new ideas and stoking its innovative culture has been one of my top priorities. I have made it my mission to innovate because if we are to remain the finest fighting force in the world, treading water won't get it done. We've made important progress on multiple fronts, implementing changes I believe will serve my successors for years to come.   Innovation is all the more necessary in today's dynamic security environment. We are currently addressing five major, unique, and rapidly evolving challenges: countering Russian aggression and coercion, especially in Europe; managing historic change in the Asia-Pacific, the most consequential region for America's future; strengthening deterrence and defensive capabilities against North Korea; checking Iranian aggression and malign influence in the Gulf; and accelerating the certain and lasting defeat of ISIL. At the same time, the Pentagon also must prepare for challenges we can't anticipate.   To take on these challenges and stay ahead of our competitors in an increasingly complex international landscape, DoD is changing and adapting how we invest in technology, how we fight, how we operate as an organization, and how we attract and nourish talent.   To ensure that our military continues leading change technologically, we are pushing the envelope on research and development. The last budget we proposed called for $72 billion in research and development in the next year alone -- more than double what Apple, Intel, and Google spent last year on R&D combined. Beyond that, we've made progress in building, and in some cases rebuilding, the bridges between the Pentagon and America's technology community. I created our Defense Innovation Unit-Experimental, or DIUx, to connect with startups and other commercial technology firms innovating in Silicon Valley; Boston; Austin, Texas; and everywhere in between.   Those DIUx outposts are already producing new ideas that will help our warfighters. We're pursuing these new initiatives while still looking to the innovative companies in our traditional defense industrial base to help us accomplish our mission as only they can. America's defense contractors will need to keep us on the cutting edge in the years ahead.   Of course, technological innovation and operational innovation go hand-in-glove. As a result, the Defense Department is reinvigorating training across the military branches to return to full-spectrum readiness, and re-thinking how we operate to find new advantages against potential adversaries. We have fundamentally revised our core contingency plans to account for changes in potential adversaries' capabilities, to apply innovation to our operational approaches, and to better counter emerging threats such as cyberattacks. These updated plans will ensure we have the agility and ability to win the fights we are in, the wars that could happen today, and the wars that could happen in the future.   Innovation in technology and operations are necessary, but insufficient, because at the pace today's world demands, the Defense Department can only succeed as a flexible institution that nurtures innovation in all its forms. We cannot afford to be bureaucratic, too slow to act or risk-averse, nor to discourage thinking differently. One effort to encourage innovative thinking is the Defense Innovation Board, which I established this year. The board, led by Alphabet and Google Executive Chairman Eric Schmidt, has already provided its first set of recommendations on how to apply America's wider innovative culture to military problems. One recommendation I've already accepted is the establishment of a chief innovation officer position to act as a senior adviser to the defense secretary on innovation.   Of course, people are the bedrock of our military superiority - that's always been the case and always will be. While we can acquire the best technology, and employ the soundest operational and organizational concepts, we are nothing without our people. So as our country and young citizens change from generation to generation, so must our methods for attracting and retaining the smartest, hardest working, and most talented among them. That's why I launched the Force of the Future initiatives, to ensure that our people will always remain cutting-edge. In total, these initiatives span the career of a uniformed service member and DoD civilian, from recruiting men and women to join, to caring for, retaining, and developing them, and then to helping successfully transition those who want to move on.   From outreach to the tech community and innovative ecosystems across the country, to operational and organizational innovation, to building the Force of the Future, the thread that connects all these efforts is that their real payoff will come down the line. Just as I've benefitted from actions by my predecessors, I am confident the Defense Department and its future leaders will benefit from these initiatives for years to come as each ensures our military remains the strongest, most capable, most innovative force on Earth.   Ash Carter is the U.S. secretary of defense   http://www.defensenews.com/   (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   National Defense   Defense Market Facing Major Transformation   By Jon Harper   Multiple factors are set to compel a major transformation in the makeup of the defense market in the coming years, according to an industry executive who previously held the number two position at the Pentagon.   Since the outset of World War II, the U.S. defense industry has undergone two major pivots, said William Lynn, a former deputy secretary of defense, who is now CEO of Leonardo North America and DRS Technologies Inc. The first occurred when the United States moved from a government-run arsenal system to one where the defense industry comprised large conglomerate manufacturing companies that had defense-focused divisions such as General Motors, IBM and GE, he said.   The second one followed the famous "Last Supper" at the end of the Cold War when then-Secretary of Defense William Perry gathered defense industry leaders and told them that the Pentagon no longer had the capacity to support the breadth of industry that existed at the time, Lynn noted.   "We ended up with the structure we have today which moved really from conglomerates to specialists," Lynn said Dec. 1 during a panel discussion at the Center for Strategic and International Studies.   For most of the major defense industry players today, 60 to 80 percent of their revenue comes from defense, he added. "We've gone from 40 or 50 major players of size in the defense market to a half a dozen."   Another major sea change is on the horizon, he argued. "We're at the cusp of a third pivot in terms of the structure of that market," he said. Several trends will drive the transformation, according to Lynn. One is consolidation.   "At the platform level, the numbers of major platforms that the department is buying is getting narrower and narrower," he said. "As a consequence, the number of competitors in that space is narrowing down to two and in some cases one" company.   There is only one prime contractor that builds aircraft carriers, and only two that build the Navy's submarines, he noted.   "Tactical aircraft is moving in that direction," he said. "You still have Boeing and Lockheed but at some point we will stop making . [Boeings] F-18s and F-15s and we'll center on the [Lockheed-built] F-35. How do you keep a competitive structure in that"   A second driver of change is the internationalization of the industrial base.   "You see it very definitely now in terms of the supply base of all of the major defense companies," Lynn said. "It's a global supply base, whereas if you look even 20 years ago it was heavily an American supply base. And now it's very global [and] they go for the best technology, the best prices. I would argue that that's going to start to shift to the prime level as well, and it has already started."   The third and perhaps the most important force leading toward another structural change is the source of technology, he said. In previous decades, research-and-development spending by the Defense Department was a key driver of innovation that later spilled over into the commercial sector, he noted, citing the development of GPS and the internet as examples.   But today, much of the cutting-edge innovation is happening outside of the Pentagon and the federal government including areas such as 3D printing, autonomy, material science and nanotechnology, Lynn said.   "The weight of the R&D is more on the commercial side. And so one of the big challenges for defense is how do you pull that technology now into the defense industrial base and operationalize it for military uses" he said. "It's a different model."   "All of those forces are pushing us toward a different type of defense structure. I think the most important thing for the new [Donald Trump] administration is to think about how they want to shape it," he added.   The new Pentagon leadership needs to focus on improving the agility of the acquisition system and incentivizing R&D spending, Lynn argued. The uncertainty surrounding the defense budget in recent years is making it difficult to do the latter, he said.   "It's very hard to ask companies to make significant investment in R&D if they don't know what the department is going to buy even 18 months from now," he said.   Embracing the commercial sector will also be critical, he noted.   "Probably the most important [question is] . how do you have a structure that allows defense companies to import commercial technologies or allows commercial companies to compete directly" Lynn said. "The department I think has a strong interest in making sure that the defense market is permeable to those commercial structures."   http://www.nationaldefensemagazine.org/blog/Lists/Posts/Post.aspxID=2364   (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Pentagon Hid Study Revealing $125 Billion in Waste   (WASHINGTON POST 06 DEC 16) ... Craig Whitlock and Bob Woodward   The Pentagon has buried an internal study that exposed $125 billion in administrative waste in its business operations amid fears Congress would use the findings as an excuse to slash the defense budget, according to interviews and confidential memos obtained by The Washington Post.   Pentagon leaders had requested the study to help make their enormous back-office bureaucracy more efficient and reinvest any savings in combat power. But after the project documented far more wasteful spending than expected, senior defense officials moved swiftly to kill it by discrediting and suppressing the results.   The report, issued in January 2015, identified "a clear path" for the Defense Department to save $125 billion over five years. The plan would not have required layoffs of civil servants or reductions in military personnel. Instead, it would have streamlined the bureaucracy through attrition and early retirements, curtailed high-priced contractors and made better use of information technology.   The study was produced last year by the Defense Business Board, a federal advisory panel of corporate executives, and consultants from McKinsey and Company. Based on reams of personnel and cost data, their report revealed for the first time that the Pentagon was spending almost a quarter of its $580 billion budget on overhead and core business operations such as accounting, human resources, logistics and property management.   The data showed that the Defense Department was paying a staggering number of people - 1,014,000 contractors, civilians and uniformed personnel - to fill back-office jobs far from the front lines. That workforce supports 1.3 million troops on active duty, the fewest since 1940.   The cost-cutting study could find a receptive audience with President-elect Donald Trump. He has promised a major military buildup and said he would pay for it by "eliminating government waste and budget gimmicks." For the military, the major allure of the study was that it called for reallocating the $125 billion for troops and weapons. Among other options, the savings could have paid a large portion of the bill to rebuild the nation's aging nuclear arsenal, or the operating expenses for 50 Army brigades.   But some Pentagon leaders said they fretted that by spotlighting so much waste, the study would undermine their repeated public assertions that years of budget austerity had left the armed forces starved of funds. Instead of providing more money, they said, they worried Congress and the White House might decide to cut deeper.   So the plan was killed. The Pentagon imposed secrecy restrictions on the data making up the study, which ensured no one could replicate the findings. A 77-page summary report that had been made public was removed from a Pentagon website.   "They're all complaining that they don't have any money. We proposed a way to save a ton of money," said Robert "Bobby" L. Stein, a private-equity investor from Jacksonville, Fla., who served as chairman of the Defense Business Board.   Stein, a campaign bundler for President Obama, said the study's data were "indisputable" and that it was "a travesty" for the Pentagon to suppress the results.   "We're going to be in peril because we're spending dollars like it doesn't matter," he added.   The missed opportunity to streamline the military bureaucracy could soon have large ramifications. Under the 2011 Budget Control Act, the Pentagon will be forced to stomach $113 billion in automatic cuts over four years unless Congress and Trump can agree on a long-term spending deal by October. Playing a key role in negotiations will probably be Trump's choice for defense secretary, retired Marine Gen. James Mattis.   The Defense Business Board was ordered to conduct the study by Deputy Defense Secretary Robert O. Work, the Pentagon's second-highest-ranking official. At first, Work publicly touted the efficiency drive as a top priority and boasted about his idea to recruit corporate experts to lead the way.   After the board finished its analysis, however, Work changed his position. In an interview with The Post, he did not dispute the board's findings about the size or scope of the bureaucracy. But he dismissed the $125 billion savings proposal as "unrealistic" and said the business executives had failed to grasp basic obstacles to restructuring the public sector.   "There is this meme that we're some bloated, giant organization," he said. "Although there is a little bit of truth in that ... I think it vastly overstates what's really going on."   Work said the board fundamentally misunderstood how difficult it is to eliminate federal civil service jobs - members of Congress, he added, love having them in their districts - or to renegotiate defense contracts.   He said the Pentagon is adopting some of the study's recommendations on a smaller scale and estimated it will save $30 billion by 2020. Many of the programs he cited, however, have been on the drawing board for years or were unrelated to the Defense Business Board's research.   Work acknowledged that the push to improve business operations lost steam after then-Defense Secretary Chuck Hagel was replaced by Ashton B. Carter in February 2015. Carter has emphasized other goals, such as strengthening the Pentagon's partnerships with high-tech firms.   "We will never be as efficient as a commercial organization," Work said. "We're the largest bureaucracy in the world. There's going to be some inherent inefficiencies in that."   'Dark Matter'   Work, a retired Marine officer, became deputy defense secretary in May 2014. With the military budget under the most pressure since the end of the Cold War, he sought help from the Defense Business Board, an advisory panel known for producing management studies that usually gathered dust.   Work told the board that the outcome of this assignment would be different. In a memo, he directed the board to collect sensitive cost data from the military services and defense agencies that would reveal how much they spent on business operations.   Pentagon officials knew their back-office bureaucracy was overstaffed and overfunded. But nobody had ever gathered and analyzed such a comprehensive set of data before.   Some Defense Business Board members warned that exposing the extent of the problem could have unforeseen consequences.   "You are about to turn on the light in a very dark room," Kenneth Klepper, the former chief executive of Medco Health Solutions, told Work in the summer of 2014, according to two people familiar with the exchange. "All the crap is going to float to the surface and stink the place up."   "Do it," Work replied.   To turn on the light, the Pentagon needed more outside expertise. A team of consultants from McKinsey was hired.   In a confidential August 2014 memo, McKinsey noted that while the Defense Department was "the world's largest corporate enterprise," it had never "rigorously measured" the "cost-effectiveness, speed, agility or quality" of its business operations.   Nor did the Pentagon have even a remotely accurate idea of what it was paying for those operations, which McKinsey divided into five categories: human resources; health-care management; supply chain and logistics; acquisition and procurement; and financial-flow management.   McKinsey hazarded a guess: anywhere between $75 billion and $100 billion a year, or between 15 and 20 percent of the Pentagon's annual expenses. "No one REALLY knows," the memo added.   The mission would be to analyze, for the first time, dozens of databases that tracked civilian and military personnel, and labor costs for defense contractors. The problem was that the databases were in the grip of the armed forces and a multitude of defense agencies. Many had fought to hide the data from outsiders and bureaucratic rivals, according to documents and interviews.   Information on contractor labor, in particular, was so cloaked in mystery that McKinsey described it as "dark matter."   Prying it loose would require direct orders from Work. Even then, McKinsey consultants predicted the bureaucracy would resist.   "This is a sensitive exercise conducted with audiences both 'weary' and 'wary' of efficiency, cost, sequestration and budget drills," the confidential memo stated. "Elements of the culture are masterful at 'waiting out studies and sponsors,' with a 'this too shall pass' mindset."   Overstaffed Chow Hall   From the outset, access to the data was limited to a handful of people. A $2.9 million consulting contract signed by the Pentagon stipulated that none of the data or analysis could be released to the news media or the public.   Moreover, the contract required McKinsey to report to David Tillotson III, the Pentagon's acting deputy chief management officer. Anytime the Defense Business Board wanted the consultants to carry out a task, Tillotson would have to approve. His office - not the board - would maintain custody of the data.   "Good news!" Work emailed Tillotson once the contract was signed. "Time to cook."   In an Oct. 15, 2014, memo, Work ordered the board to move quickly, giving it three months to produce "specific and actionable recommendations."   In a speech the next month, Work lauded the board for its private-sector expertise. He said he had turned it into "an operational arm" of the Pentagon leadership and predicted the study would deliver transformational results.   In an aside, he revealed that early findings had determined the average administrative job at the Pentagon was costing taxpayers more than $200,000, including salary and benefits.   "And you say, hmmm, we could probably do better than that," he said.   The initial results did not come as a surprise.   Former defense secretaries William S. Cohen, Robert M. Gates and Chuck Hagel had launched similar efficiency drives in 1997, 2010 and 2013, respectively. But each of the leaders left the Pentagon before their revisions could take root.   "Because we turn over our secretaries and deputy secretaries so often, the bureaucracy just waits things out," said Dov Zakheim, who served as Pentagon comptroller under President George W. Bush. "You can't do it at the tail end of an administration. It's not going to work. Either you leave the starting block with a very clear program, or you're not going to get it done."   Arnold Punaro, a retired Marine general and former staff director for the Senate Armed Services Committee, said lawmakers block even modest attempts to downsize the Pentagon's workforce because they do not want to lose jobs in their districts.   Without backing from Congress, "you can't even get rid of the guy serving butter in the chow hall in a local district, much less tens of thousands of jobs," he said.   'Time To Hunt!'   The Defense Business Board assigned five members to conduct the study alongside consultants from McKinsey. Scott Rutherford, senior partner at McKinsey's Washington office, declined to comment.   The team ran into resistance as several Pentagon offices delayed requests for data, according to emails and memos. Work and Tillotson had to intervene to get the data flowing. At one point, more than 100 people were feeding data from different sectors of the bureaucracy.   Laboring under its tight deadline, the team hashed out an agreement with Pentagon officials over which job classifications to count in their survey. The board added a sixth category of business operations - real property management. That alone covered 192,000 jobs and annual expenses of $22.6 billion.   On Christmas Eve, Klepper emailed Work and Tillotson to thank them for putting their muscle behind the project. Without it, he said, "this would all have been DOA and the naysayers would all have been right." He hinted the board would make some eye-catching recommendations and expressed relief its work had not been torpedoed.   "I have to admit, with all the caution, negative reaction and pushback," Klepper said, "I had a bit of concern at the end of the analysis some form of censorship would stop us from showing the true opportunity." Work replied that he could not be happier.   "Time to hunt!" he said in an email, adding that he was "very excited about 2015" and ready to make "some bold moves."   The year kicked off with promise. On Jan. 21, 2015, the Pentagon announced Stein, the private-equity investor, had been reappointed as the board's chairman and praised him for his "outstanding service."   The next day, the full board held its quarterly public meeting to review the results of the study. The report had a dry title, "Transforming DoD's Core Business Processes for Revolutionary Change," and was packed with charts and jargon. But it began plainly enough.   "We are spending a lot more money than we thought," the report stated. It then broke down how the Defense Department was spending $134 billion a year on business operations - about 50 percent more than McKinsey had guessed at the outset.   Almost half of the Pentagon's back-office personnel - 457,000 full-time employees - were assigned to logistics or supply-chain jobs. That alone exceeded the size of United Parcel Service's global workforce.   The Pentagon's purchasing bureaucracy counted 207,000 full-time workers. By itself, that would rank among the top 30 private employers in the United States.   More than 192,000 people worked in property management. About 84,000 people held human-resources jobs. The study laid out a range of options. At the low end, just by renegotiating service contracts and hiring less-expensive workers, the Pentagon could save $75 billion over five years. At the high end, by adopting more aggressive productivity targets, it could save twice as much.   After a discussion, the full board voted to recommend a middle option: to save $125 billion over five years.   Hordes Of Contractors   Afterward, board members briefed Work. They were expecting an enthusiastic response, but the deputy defense secretary looked uneasy, according to two people who were present.   He singled out a page in the report. Titled "Warfighter Currency," it showed how saving $125 billion could be redirected to boost combat power. The money could cover the operational costs for 50 Army brigades, or 3,000 F-35 Joint Strike Fighters for the Air Force, or 10 aircraft-carrier strike groups for the Navy.   "This is what scares me," he said, according to the two people present. Work explained he was worried Congress might see it as an invitation to strip $125 billion from the defense budget and spend it somewhere else.   A few weeks later, Carter replaced Hagel as defense secretary. Carter sounded as though he would welcome the kind of revolutionary change the board was urging.   "To win support from our fellow citizens for the resources we need, we must show that we can make better use of every taxpayer dollar," Carter said in an inaugural message in February 2015. "That means a leaner organization, less overhead, and reforming our business and acquisition practices."   In briefings that month, uniformed military leaders were receptive at first. They had long groused that the Pentagon wasted money on a layer of defense bureaucracies - known as the Fourth Estate - that were outside the control of the Army, Air Force and Navy. Military officials often felt those agencies performed duplicative services and oversight.   But the McKinsey consultants had also collected data that exposed how the military services themselves were spending princely sums to hire hordes of defense contractors.   For example, the Army employed 199,661 full-time contractors, according to a confidential McKinsey report obtained by The Post. That alone exceeded the combined civil workforce for the Departments of State, Agriculture, Commerce, Education, Energy, and Housing and Urban Development.   The average cost to the Army for each contractor that year: $189,188, including salary, benefits and other expenses.   The Navy was not much better. It had 197,093 contractors on its payroll. On average, each cost $170,865. In comparison, the Air Force had 122,470 contractors. Each cost, on average, $186,142.   Taking Fire   Meantime, the backlash to the $125 billion savings plan intensified.   On Feb. 6, 2015, board members briefed Frank Kendall III, the Pentagon's chief weapons-buyer. Kendall's operations were a major target of the study; he oversaw an empire of purchasing agents and contractors that were constantly under attack from Congress for cost overruns and delays.   Kendall put up a stiff fight. He challenged the board's data and strenuously objected to the conclusion that his offices were overstaffed.   "Are you trying to tell me we don't know how to do our job" he said, according to two participants in the meeting. He said he needed to hire 1,000 more people to work directly under him, not fewer.   "If you don't believe me, call in an auditor," replied Klepper, the board's restructuring expert. "They'll tell you it's even worse than this."   In an interview, Kendall acknowledged he was "very disappointed" by the board's work, which he criticized as "shallow" and "very low on content." He said the study had ignored efforts by his agencies to become more efficient, and he accused the board of plucking the $125 billion figure out of thin air.   "It was essentially a ballpark, made-up number," he said.   Still, Kendall knew that lawmakers might view the study as credible. Alarmed, he said, he went to Work and warned that the findings could "be used as a weapon" against the Pentagon.   "If the impression that's created is that we've got a bunch of money lying around and we're being lazy and we're not doing anything to save money, then it's harder to justify getting budgets that we need," Kendall said. More ominously, board members said they started to get the silent treatment from the Pentagon's highest ranks.   Briefings that had been scheduled for military leaders in the Tank - the secure conference room for the Joint Chiefs of Staff - were canceled. Worse, the board was unable to secure an audience with Carter, the new defense secretary.   Stein, the board chairman, accused Carter of deliberately derailing the plan through inaction. "Unfortunately, Ash - for reasons of his own - stopped this," he said in an interview.   Peter Cook, a spokesman for Carter, said the Pentagon chief was busy dealing with "a long list of national security challenges." He added that Work and other senior officials had already "concluded that the report, while well-intentioned, had limited value."   The fatal blow was struck in April. Just three months after Stein had been reappointed as board chairman, Carter replaced him with Michael Bayer, a business consultant who had previously served on the panel and clashed with Stein. Bayer declined to comment.   A few weeks later, Klepper resigned from the board. The $125 billion savings plan was dead.   In an interview, Tillotson, the Pentagon's acting deputy chief management officer, called the board's recommendations too ambitious and aggressive. "They, perhaps, underestimated the degree of difficulty we have in doing something that in the commercial sector would seem to be very easy to do."   Yet he acknowledged that its overall strategy for scaling back the bureaucracy was sound and that, given more time, it would be possible to realize huge savings.   "If we had a longer timeline, yes, it would be a reasonable approach," he said. "You might get there eventually."   Ending The Debate   Frustration, however, persisted in some corners over the Pentagon's unwillingness to tackle the inefficiency and waste documented by the study.   On June 2, 2015, Navy Secretary Ray Mabus delivered a speech at the American Enterprise Institute, a conservative think tank. He complained that 20 percent of the defense budget went to the Fourth Estate - the defense agencies that provide support to the armed forces - and called it "pure overhead."   He singled out the Defense Finance and Accounting Service and the Defense Logistics Agency, which together employ about 40,000 people, as egregious examples.   When a reporter in the audience asked whether he thought the agencies should be abolished, Mabus resisted the temptation to say yes.   "Nice try on getting me into deep trouble," he replied.   But trouble arrived in Mabus's email the next day.   "Ray, before you publicly trash one of the agencies that reports through me I'd really appreciate a chance to discuss it with you," wrote Kendall, the Pentagon's chief weapons-buyer, whose management portfolio included the Defense Logistics Agency.   He said that if Mabus had a complaint, he should raise it directly with their mutual bosses, Carter and Work, and copied the email to both.   In his interview with The Post, Kendall said he was "completely blindsided" by the Navy secretary's criticism, "so I sent him what I thought under the circumstances was a pretty polite note."   Mabus did not back down. In an emailed retort to Kendall, he referred to the ill-fated Defense Business Board study.   "I did not say anything yesterday that I have not said both publicly ... and privately inside this building," he said. "There have been numerous studies, which I am sure you are aware of, pointing out excessive overhead." That prompted a stern intervention from Work.   "Ray, please refrain from taking any more public pot shots," Work said in an email. "I do not want this spilling over into further public discourse."   Evelyn Duffy contributed to this report.   https://www.washingtonpost.com/investigations/pentagon-buries-evidence-of-125-billion-in-bureaucratic-waste/2016/12/05/e0668c76-9af6-11e6-a0ed-ab0774c1eaa5_story.html   (return to top) +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Post Expose on Pentagon Waste Draws Mixed Reviews   (GOVERNMENT EXECUTIVE 06 DEC 16) ... Charles S. Clark   With the words "exclusive" and "Bob Woodward" on top of its story, The Washington Post's Tuesday expose on a "buried" Pentagon study that identified an $125 billion in waste over five years drew considerable attention.   Several lawmakers, the Defense Department's chief union and at least one anti-waste advocacy group greeted the story as vindication of their past critiques of military contacting bloat. But the department itself and former officials told Government Executive that the alleged value of wasted money was overstated.   Woodward and veteran investigative reporter Craig Whitlock's story, headlined "Pentagon buries evidence of $125 billion in bureaucratic waste," described a McKinsey & Co. study commissioned by the Defense Business Board at the behest of Deputy Defense Secretary Robert Work.   A version was released in January 2015, but only after officials attempted to hide the data from the public - efforts the Post documented. The study, which was covered at the time by Defense News and other major defense publications, "revealed for the first time that the Pentagon was spending almost a quarter of its $580 billion budget on overhead and core business operations such as accounting, human resources, logistics and property management," the Post wrote.   The data showed that Defense is "paying a staggering number of people - 1,014,000 contractors, civilians and uniformed personnel - to fill back-office jobs far from the front lines. That workforce supports 1.3 million troops on active duty, the fewest since 1940," the reporters wrote, supplying new numbers such as 457,000 in supply chain and logistics and 207,000 people in acquisition and procurement.   The response on Capitol Hill on Tuesday was quick. Armed Services Committee chiefs Sen. John McCain, R-Ariz., and Rep. Mac Thornberry, R-Texas, joined in a statement calling the findings "not a surprise ... We have known for many years that the department's business practices are archaic and wasteful, and its inability to pass a clean audit is a longstanding travesty. The reason these problems persist is simple: a failure of leadership and a lack of accountability."   Which is why, they continued, the committees over the past two years have mandated a 25 percent cut in the Pentagon's administrative support and headquarters staff, along with a 12 percent reduction in flag officers and civilian Senior Executive Service employees.   Sen. Claire McCaskill, D-Mo., who in January will become the top-ranking Democrat on the Senate Homeland Security and Governmental Affairs Committee, reacted more strongly. "If this is true, the Pentagon played Congress and the American public for fools," she said. "It would mean that while some in Congress were busy debating cuts to vital services, furloughing employees, and threatening working people's' pensions, the Department of Defense literally knew it could save the American people billions and billions of dollars in bureaucratic waste, and instead, they buried it. I vow to get to the bottom of this."   American Federation of Government Employees President J. David Cox Sr. said in a statement to Government Executive that the report "confirms what we have known for decades: that the Pentagon is flagrantly wasting taxpayer money by hiring costly and less accountable contractors to do support work that civilians can do for far less. By insourcing much of this work, the Pentagon could free up tens of billions of dollars a year to invest in our troops."   Cox added, "We are glad that this long-suppressed report has seen the light of day and hope it spurs action in Congress to curb the Pentagon's wasteful spending on service contracts," but AFGE actually commented on the report back in January 2015, expressing surprise that the Defense Business Board had changed its past leanings and called for cutting the civilian workforce.   In the Post story, Work highlighted savings reforms already underway at the Pentagon, adding that the Defense board's reforms for saving $125 billion were "unrealistic on the intended timeline given the defense program, budgeting procedures and the unique impediments facing the department that do not apply in the private sector."   Pentagon press secretary Peter Cook on Tuesday told the Associated Press that senior managers at the Pentagon concluded that the study, "while well-intentioned, had limited value" because it didn't take into account existing programs to improve efficiency and because it lacked "specific, actionable recommendations appropriate to the department."   Also skeptical was Robert Hale, the former Pentagon comptroller who left in June 2014 (before the Defense Board study) and is now a fellow at Booz Allen Hamilton. "There is no question that there is waste and inefficiency at DoD," he told Government Executive. "And a number of items the board mentioned - such as getting rid of low-priority contracts and optimizing labor contracts - are things the department has tried and has achieved some progress."   But the projected savings of $125 billion in five years "appears based on some assumed productivity gains, 9 percent savings in the first year, 3 percent to 5 percent per year after that, but in my experience you don't get those kinds of savings."   The study's own private-sector comparisons, he noted, showed that only 17 percent of optimization efforts achieve their full potential. Also, "the department is busy fighting wars, which does take away the time they have to spend" on efficiency reforms, said Hale, who recently laid out his own 10 efficiency recommendations in a paper published by Center for New American Security.   Plus, Defense employees' "incentives are not the same as in the private sector, where if you save money and keep customers, you're happy to get a big bonus," Hale said. "In DoD, some comptroller like me is likely to grab savings for some other purpose."   Mark Cancian, an alumnus of the Pentagon and the Office of Management and Budget who is now senior adviser at the Center for Strategic and International Studies, noted that the Post's phrasing of the story as "bureaucratic incompetence" will have impact because the paper has influence in Washington. But the study "doesn't actually specify any actions for savings," instead calling for "a committed leadership to stand up cross-functional teams that will look at contracts and the workforce and apply the best commercial practices."   Cancian said he can see why Deputy Secretary Work would be frustrated that the study "threw $125 billion around as if it were on the table," he said. "You have to talk about specifics, not just paint with a broad brush."   As a veteran himself, he added, "applying commercial practices that identify specific areas of savings often cause people to recoil and push back." The example he gave is the often-offered proposal to shut down commissaries.   "No company has its own grocery store, but to many in the military community, they are a symbol of a commitment made to them," Cancian said. "It's part of what makes the military culture so distinctive."   Danielle Brian, executive director of the nonprofit Project on Government Oversight, called the Post story "a perfect illustration of the three biggest problems affecting the Defense Department: a contractor workforce that costs too much; a culture of secrecy; and a fear that exposing waste will lead to cuts in defense spending. It and other reports also show there are plenty of opportunities to cut Pentagon spending and the next administration should be skeptical of anyone who tells them otherwise."   http://www.govexec.com/defense/2016/12/post-expose-pentagon-waste-draws-mixed-reviews/133685/   (return to top)   +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++   Breaking Defense   $125 Billion Savings Not So Fast, Say Experts, DoD, Rep. Smith   By Sydney J. Freedberg Jr.   WASHINGTON: Want to save $125 billion by slashing Pentagon "waste" Not so fast. If you take a closer look at the much-touted Defense Business Board study proposing those cuts- which was published in 2015 but went viral after Monday's Washington Post story saying the Pentagon had "burie[d]" it - and talk to experts, officials, and the top House Democrat on defense policy, the savings turn out to be less of a slam-dunk than advertised.   "I don't necessarily think the report is overstating the ease with which that savings can be achieved," said Rep. Adam Smith, the cerebral and snarky ranking member of the House Armed Services Committee. "But I certainly think the reporting on the report is overstating the ease with which we can save that $125 billion."   First, divide by five: A crucial detail the headlines always omitted is that the DBB forecast $125 billion in savings over five years. That makes the annual savings from their proposed efficiencies a still respectable but hardly game-changing $25 billion a year. "That's [about] 4% of total DoD outlays," calculates Capital Alpha analyst Byron Callan, "which is well within the types of savings corporations would strive to achieve."   Why does that figure happen to be well within the norm for private sector cost-cutting practices It's because the whole premise of the study, in essence, is to ask how much DoD could save if it followed - all together now - private sector cost-cutting practices.   In fact, the analytical underpinnings of the study seem to have been done by McKinsey & Company, a world-famous private-sector management consultancy. McKinsey has a reputation for hiring bright young things with zero experience, a former director convicted of insider trading, and a client roster that includes Enron, AOL before its disastrous merger with Times-Warner, and many more imploded companies. But, whether following McKinsey & Co.'s advice is wise or otherwise, the study's 77 pages of publicly released briefing slides don't say how to apply these private-sector practices to the Pentagon - which rather begs the point.   For example, it says that a "4-8% annual productivity gain for DoD is a realistic goal," but its only argument for why that's realistic seems to be that corporations routinely achieve it (slide 9), without saying how well that would translate into the public sector. The study projects "15-40% gains in IT productivity and effectiveness" (slide 19), but it doesn't say how to realize them, or how hard it might be. To the contrary, the IT goal glosses over the disastrous record of past government information technology mega-projects, even though some of them are cited as case studies in backup slides (49-54). "Even in the private sector, only 17% of fundamental change projects deliver their full potential," the report admits at one point (slide 26).   Another major area of savings is large-scale early retirements (17-18, 41). While it makes some provision for retention bonuses to keep the most skilled employees (3), the study ignores the looming demographic crisis of too many retirement-age employees leaving the civil service at once, with too few experienced mid-career personnel to replace their institutional knowledge.   "The report lacked specific, actionable recommendations," Pentagon spokesman Gordon Trowbridge told me. "Where the study did offer concrete recommendations, the department has taken action. For example, we have implemented service contract review boards that are projected to achieve billions of dollars in savings." Overall, the department is aiming to save $30 billion over four years from efficiencies, an average of $7.5 billion a year.   That's hardy $25 billion a year, though. "I think it is probably not a reasonable goal, and the work the DBB did doesn't provide any basis to set it as a goal," said Andrew Hunter. As the former head of the Pentagon's celebrated Joint Rapid Acquisition Cell, and now director of defense industrial initiatives at the Center for Strategic & International Studies, Hunter knows a thing or two about making defense procurement faster and more efficient.   Where the DBB does provide specific courses of action, they're not necessarily feasible, either. "Their proposal to renegotiate contracts across the board is impractical," Hunter told me, "and they don't appear to have been aware of the significant efforts (already) underway across the services to reduce service contract costs."   That said, Hunter emphasizes, "they did a nice job of collecting business operations costs across the Department. The value in what the DBB did is if you collect this information consistently over time, you can detect and act on positive and negative trends in business operations."   Data is vital to accurate analysis, and the Washington Post's most damning accusation the Pentagon "imposed secrecy restrictions on the data making up the study, which ensured no one could replicate the findings." When I asked Pentagon sources about this, though, they weren't quite sure what the Post meant.   The substantive section of the report - the 77 slides of recommendations and analysis - "has been available continuously online since January 2015," said Trowbridge. "We understand some members of Congress might be interested in seeing the underlying data, and, as always, we'll respond to those requests."   "Data wasn't classified, but some was marked proprietary," said another defense official. "If someone wants the info, they just need to ask and DBB will give it out, minus proprietary stuff." Proprietary in Pentagon parlance specifically refers to the intellectual property of contractors, and one of the major thrusts of the report was negotiating lower contract costs.   "The report was valuable and continues to shape the way the Department is pursuing efficiencies in cross-enterprise business functions," the official emphasized. But it's not an executable plan of action on its own, the official continued, and the Pentagon now "has DBB looking at ways to actually achieve the $125B in savings."   The Washington Post story has certainly turned up the pressure to save. The chairman of the House and Senate Armed Services Committees, acquisition reform crusaders Rep. Mac Thornberry and Sen. John McCain, called for all the underlying data to be made public. Their scathing joint statement read (in part), "We have known for many years that the Department's business practices are archaic and wasteful, and its inability to pass a clean audit is a longstanding travesty. The reason these problems persist is simple: a failure of leadership and a lack of accountability."   But maybe the reason is not so simple. Maybe it's a complex interaction of a $496 billion-a-year organization - that's more than Wal-Mart, the world's largest company - building cutting-edge hardware and operating it in life-or-death circumstances, all under unrelenting scrutiny from 535 members of Congress.   "It's an enormously important report, and I think it's something we should look at closely," said Rep. Smith, speaking to the US Naval Institute's annual defense conference at the Newseum. "(But) I wouldn't get overexcited about it - like, 'wow, $125 million just laid on the table that we can go spend!'" "I have not yet encountered the human endeavor that does not contain waste, fraud, and abuse," Smith said.   "There's waste fraud and abuse at IBM, at Microsoft, at Amazon." (We just don't know as much about it because Congress can't routinely see their books or haul their executives up to testimony). "I think it's our job in Congress and the job of whoever ends up running DoD to do their level best to get as much of that savings as possible, and I'd be interested in looking at the details of where they think they're going to get that $125 billion."   "But," Smith concluded, "understand it's not as easy as it might appear."   http://breakingdefense.com/2016/12/125-billion-savings-not-so-fast-say-experts-rep-smith/