Reversing course, Pentagon says it fully supports restructuring of its acquisition bureaucracy

Last week, the Pentagon met the letter of the law by turning in a report to Congress on how it plans to implement one of its largest organizational changes in decades: the bifurcation of the current office of the undersecretary of Defense for acquisition, technology  and logistics (AT&L) and the creation of a new chief management officer.

But the report — a two-page memo from Deputy Defense Secretary Robert Work — offers scant detail about where the department is headed with the reorganization. That’s perhaps understandable, since Congress handed DoD the task of restructuring itself during a presidential transition and when virtually all of its Senate-confirmed leadership posts are empty.

Still, there are a few interesting tidbits in the interim report, a final version of which is due to the Hill by Aug. 1. For instance, DoD says it may ask Congress to elevate the new chief management officer role to a higher-ranking position: an undersecretary for management. Congress actually did that in the 2016 Defense authorization bill, but then repealed the change with the 2017 bill, when House-Senate negotiators settled on the position of CMO instead.

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“The department is looking carefully at the organizational responsibilities and structures associated with this senior management official position,” Work wrote in the March 1 memo. “Our goal is to create a position that will attract the best qualified candidate who possesses the requisite business acumen to optimize the business operations of the department and to give that person the requisite authority to improve the performance of the business operations of the department. The focus would address responsibilities for both department-wide business processes and more focused responsibilities for processes within office of the secretary of Defense and defense/field agencies.”

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With regard to the other major change in the 2017 bill, the splitting of AT&L into two separate undersecretaries — one for research and engineering and one for acquisition and sustainment — Work, an Obama administration holdover, said DoD fully supports the change.

That’s interesting in and of itself, considering that the Obama White House strongly objected to a similar proposal to divide AT&L. In a veto threat last June, the administration said the new structure would create “dysfunctional partitions across DoD’s research, engineering, procurement, and sustainment systems that will make it harder to sustain the department’s improved performance.”

Now that the partition has been enacted into law, DoD says it intends to take full advantage of the flexibilities Congress gave DoD to design the roles and responsibilities of the two new undersecretaries. Indeed, lawmakers gave the department very little direction on the bureaucratic details of the reorganization, other than to say they wanted a new undersecretary to focus on sharpening the military’s technological edge.

Work said the department plans to “conduct a broader rationalization of the offices, organizations, and processes within the USD (AT&L) portfolio and their alignment, and potential overlap, with other functional areas and processes across OSD and the services.”

The current AT&L office has duties that extend well beyond R&D and acquisition oversight. It oversees thousands of employees working for nine defense agencies, including the including the Missile Defense Agency, the Defense Logistics Agency, the Defense Contract Management Agency and the Defense Threat Reduction Agency. Because of that, Congress had a difficult time figuring out which of the two new undersecretaries should be responsible for several elements of the current DoD organizational structure, and deferred decisions for later legislation.

But Work said it’s entirely possible that the department might prefer to move several of those functions to entirely different parts of DoD, or perhaps devolve some of them to the military services.

“The department is examining the realignment of legacy AT&L functions to other [office of the secretary of Defense] and service officials if it is prudent and can provide greater integration of efforts. In so doing, these actions, in turn, can facilitate greater focus of these two undersecretaries on the imperatives for technology innovation and continuing acquisition reform; both of which directly support the needs of our warfighters, now and in the future.”

Many of the gritty details of how DoD plans to pull off the restructuring are still awaiting decisions by Defense Secretary James Mattis, Work said. Although the department’s final report isn’t due until August, he said he hopes to complete it by late spring or early summer, when congressional committees are working on the early language for the 2018 Defense authorization bill.

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