Monitoring the military-industrial complex

In his 1961 farewell address, President Dwight D. Eisenhower warned the nation about the military-industrial complex. The man who spent most of his adult life in uniform, and eight years as commander in chief, said there must be a balance between military might and diplomacy.

It’s a balance many are still working at today in a government that, in some operations, has a contractor to civil servant ratio of 6-to-1.

As I take off for a brief vacation, I’ve asked several readers and experts to write guest columns. Leading them off is Wayne Abba, a long-time Pentagon employee who knows a lot about Defense Department contracting practices. He calls his piece “A government-industry regulatory balancing act”:

Ensuring compliance with law, agency policies, rules, regulations, and contracts is a primary responsibility of public servants. During my Defense Department career, I reviewed and analyzed contractor cost and schedule management systems and data at all levels. I did so from the procuring organization, to military department headquarters and the Office of the Secretary of Defense.

By the time I reached the top of the regulatory pyramid, I was trained and grounded in contract law, negotiation, cost analysis and other skills that prepared me for my ultimate position as the department’s senior contractor performance analyst.

Each step up the career ladder brings more responsibility and more opportunity to use discretion. As an entry level intern, one learns process: understanding governing law and regulation, ensuring all the mandatory clauses are in the solicitation, conducting and documenting the negotiation, awarding the contract. Dialogue with counterparts in industry necessarily is constrained both ethically and legally.

At senior levels, one has more latitude, for example, by working with industry associations.
In my experience, industry associations devote much of their interaction with government to understanding compliance requirements in order to implement those minimal processes and actions that are needed to pass a contract management review.

On the other hand, government organizations would prefer to see self-governance by industry in order to reduce the need for reviews. The optimal balance between these objectives is elusive, with the pendulum swinging between “insight” and “oversight.”

Insight implies a hands-off approach to contract governance, with industry following accepted management guidelines and providing reliable performance information to government customers. Hands-on oversight by customers requires more regulations and specialized government resources, people who must be trained in industrial management. This is a particular challenge given the rapid advances in industrial management processes, especially in information technology.

Oversight leads inexorably to tighter regulation. When reviewers find a contractor is not complying with their interpretation of a given guideline, implementation instructions often are rewritten more narrowly in an attempt to preclude recurrence, a ratchet-like process that erodes discretionary judgment. The less experience a reviewer has, the more he or she tends to rely on a fixed checklist and to interpret guidelines in ways that inhibit a contractor’s ability to introduce innovative management practices.

This cycle occasionally is reversed by reform initiatives, driven by influences such as contract cost overrun scandals or policies introduced by new presidential administrations. Excessive regulations are reduced, management attention increases and things improve for a while, but in time will revert. Reforms in the 1990s led to more responsible industry leadership, followed a decade later by reversion to more oversight in response to contract management failures. And so the cycle continued.

At this writing, the balance in my opinion is good. The National Defense Industrial Association’s Integrated Program Management Division enjoys a renewed productive, open working relationship with its government counterparts. But with the DoD beginning yet another acquisition reorganization and evaluating reform recommendations, can it last? My internal optimist says it can, provided best practices from the past are not discarded.

My professional colleague Anthony Corridore recently wrote in this space about the “best practice” guides published by the Government Accountability Office, compiled with the help of experts from government, industry and academia. Other invaluable resources are the professional associations that offer training and interactive forums to advance the state of the art. Removed from the strictures of contractual settings, people — novice and experienced, young and mature, government and industry — grow professionally while building mutual understanding and earning certifications that can enhance or even replace organizational training.

Our goal is to help move beyond “insight vs. oversight” by creating a shared vision of professional contract and program management.

Wayne Abba retired from the Office of the Secretary of Defense in 1999 and is president of the College of Performance Management, a non-profit professional organization dedicated to the disciplines of project management and performance measurement.

Nearly Useless Factoid

By Amelia Brust

Sources: Wikipedia

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