[House Hearing, 111 Congress]
[From the U.S. Government Printing Office]


 
                         [H.A.S.C. No. 111-46] 

    THE ACQUISITION WORKFORCE: MERELY A BUSINESS EXPENSE OR A FORCE 
                     MULTIPLIER FOR THE WARFIGHTER? 

                               __________

                                HEARING

                               BEFORE THE

               OVERSIGHT AND INVESTIGATIONS SUBCOMMITTEE

                                 OF THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD

                             APRIL 28, 2009

                                     
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               OVERSIGHT AND INVESTIGATIONS SUBCOMMITTEE

                     VIC SNYDER, Arkansas, Chairman
JOHN SPRATT, South Carolina          ROB WITTMAN, Virginia
LORETTA SANCHEZ, California          WALTER B. JONES, North Carolina
ELLEN O. TAUSCHER, California        MIKE ROGERS, Alabama
SUSAN A. DAVIS, California           TRENT FRANKS, Arizona
JIM COOPER, Tennessee                CATHY McMORRIS RODGERS, Washington
JOE SESTAK, Pennsylvania             DOUG LAMBORN, Colorado
GLENN NYE, Virginia                  DUNCAN HUNTER, California
CHELLIE PINGREE, Maine
                  Suzanne McKenna, Research Assistant
                Thomas Hawley, Professional Staff Member
                      Trey Howard, Staff Assistant














                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2009

                                                                   Page

Hearing:

Tuesday, April 28, 2009, The Acquisition Workforce: Merely a 
  Business Expense or a Force Multiplier for the Warfighter?.....     1

Appendix:

Tuesday, April 28, 2009..........................................    31
                              ----------                              

                        TUESDAY, APRIL 28, 2009
    THE ACQUISITION WORKFORCE: MERELY A BUSINESS EXPENSE OR A FORCE 
                     MULTIPLIER FOR THE WARFIGHTER?
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Snyder, Hon. Vic, a Representative from Arkansas, Chairman, 
  Oversight and Investigations Subcommittee......................     1
Wittman, Hon. Rob, a Representative from Virginia, Ranking 
  Member, Oversight and Investigations Subcommittee..............     3

                               WITNESSES

Assad, Shay D., Acting Deputy Under Secretary of Defense, 
  Acquisition and Technology, U.S. Department of Defense.........     4
Needham, John K., Director, Acquisition and Sourcing Management, 
  U.S. Government Accountability Office..........................     9
Shackelford, Lt. Gen. Mark, USAF, Military Deputy to the 
  Assistant Secretary of the Air Force, Acquisition, U.S. 
  Department of the Air Force....................................     8
Thompson, Lt. Gen. N. Ross, III, USA, Principal Military Deputy 
  to the Assistant Secretary of the Army for Acquisition, 
  Logistics and Technology and Director, Acquisition Career 
  Management, U.S. Department of the Army........................     6
Thomsen, James, Principal Civilian Deputy for the Assistant 
  Secretary of the Navy, Research Development and Acquisition, 
  U.S. Department of the Navy....................................     7

                                APPENDIX

Prepared Statements:

    Assad, Shay D................................................    42
    Needham, John K..............................................    82
    Shackelford, Lt. Gen. Mark...................................    74
    Thompson, Lt. Gen. N. Ross III...............................    53
    Thomsen, James...............................................    66
    Snyder, Hon. Vic.............................................    35
    Wittman, Hon. Rob............................................    39

Documents Submitted for the Record:

    [There were no Documents submitted.]

Witness Responses to Questions Asked During the Hearing:

    [There were no Questions submitted during the hearing.]

Questions Submitted by Members Post Hearing:

    Mr. Franks...................................................   109
    Ms. Sanchez..................................................   109
    Dr. Snyder...................................................   105
    THE ACQUISITION WORKFORCE: MERELY A BUSINESS EXPENSE OR A FORCE 
                     MULTIPLIER FOR THE WARFIGHTER?

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
                 Oversight and Investigations Subcommittee,
                           Washington, DC, Tuesday, April 28, 2009.
    The subcommittee met, pursuant to call, at 10:00 a.m., in 
room 2118, Rayburn House Office Building, Hon. Vic Snyder 
(chairman of the subcommittee) presiding.

  OPENING STATEMENT OF HON. VIC SNYDER, A REPRESENTATIVE FROM 
 ARKANSAS, CHAIRMAN, OVERSIGHT AND INVESTIGATIONS SUBCOMMITTEE

    Dr. Snyder. The hearing will come to order. Good morning 
and welcome to the third, and the final, in a series of three 
hearings held by the Oversight and Investigations Subcommittee 
following up on several acquisition matters.
    Before we get started I want to recognize and welcome 50 
International Fellows of the Naval War College who are in 
attendance at today's hearing. I say they are in attendance. I 
think they are actually divided up so that some who are in 
another room are going to swap out at some point because the 
hearing room is not big enough. That is why we moved to this 
hearing room, by the way.
    Welcome to all of you from the Naval War College 
International Fellows Program. We appreciate you being here. 
Incidentally, a professional military education is something 
that this subcommittee is very, very interested in, as is 
Chairman Skelton, and we have an ongoing study for the rest of 
this year that we are working on.
    Our first two hearings centered on acquisition and 
management issues in the Afghanistan and Iraq theaters of 
operation. Today's hearing is more broadly focused on the 
Department of Defense acquisition workforce. It is a timely 
topic.
    Acquisition reform is a high priority here in the Congress 
and in the executive branch. Chairman Skelton and Mr. McHugh 
introduced weapons system acquisition reform legislation this 
week. And they have established a special acquisition reform 
panel, led by our colleague Congressman Rob Andrews of Jersey. 
And both the President and Secretary Gates have also spoken 
about the critical need for acquisition reform. Speaker Pelosi 
has been very clear on the importance of saving tax dollars, as 
well as being sure our men and women in uniform and our 
military families get all the services they need.
    I think I was struck--probably the best summary I thought, 
Mr. Assad, was from your opening statement--and I am going to 
quote to you now--in which you say, ``The objective is 
straightforward: to ensure Department of Defense (DOD) has the 
right acquisition capability and capacity to produce best value 
for the American taxpayer and for the soldiers, sailors, airmen 
and marines who depend on the weapons, products, and services 
we buy.''
    And that simple objective is what has led us here today, 
because a lot of us think we have got work to do. The 
acquisition workforce is at the heart of the acquisition 
system. No doubt there are the policies and the organizational 
structures that make up important parts of the defense 
acquisition system, but there are also the people; the 
engineers, cost estimators, systems engineers, contracting 
officers, program managers, contract specialists, quality 
assurance inspectors, logisticians, finance personnel, and 
auditors who carry out the acquisition function from start to 
finish.
    Working as a team, these members of the workforce are key 
players in both supporting the warfighter's needs and 
safeguarding the taxpayers' dollars. We are all familiar with 
the problems many of the major programs are facing in terms of 
substantial cost overruns, schedule delays, and problems with 
performance.
    As part of a larger package of reforms, Secretary Gates 
announced a plan to begin rebuilding the acquisition team to 
help address those problems. We think the Department already 
has many important tools for developing and managing the 
workforce. Congress has at times helped solve these problems, 
and Congress has at times helped create these problems.
    The Armed Services Committee has been very active in 
passing legislation to ensure that the Department attracts and 
maintains a professional high-quality acquisition workforce. 
This subcommittee's immediate predecessor, the House Armed 
Services Subcommittee on Investigations, in 1990 drafted the 
legislation in this area: the Defense Acquisition Workforce 
Improvements Act.
    On the other hand, Congress bears some responsibility for 
the current state of affairs because during the post-Cold War 
drawdown era, Congress mandated a series of reductions in the 
acquisition workforce, only to be followed by an era of 
increasing demands and dramatic growth in the Department's 
procurement budget after September 11th.
    In recent years we began recognizing a critical role played 
by the workforce and established the Acquisition Workforce 
Development Fund providing billions of dollars for the next 
several years for recruiting, retaining, and training the right 
people. We have provided expedited hiring authority to allow 
the Department to bring on qualified candidates quickly. We 
encouraged the Department to ensure that critical acquisition 
positions like program managers, cost estimators, and chief 
engineers are filled by government personnel. And we required 
the establishment of a career path, including general and flag-
officer billets for military personnel in the acquisition 
field.
    We have lifted civilian personnel caps for acquisition 
positions. And we have given the Department the authority to 
in-source new work and bring back work that the Department 
previously outsourced. We look forward to hearing how these 
tools are helping.
    We also would like to hear how the Department and services 
plan to change from an institutional mind-set that in the past, 
due to the acquisition workforce, is merely performing an often 
arcane business function, to one that instead recognizes the 
critical and essential work that the acquisition workforce 
performs.
    When we talk about changing mind-sets, I believe that the 
change of mind-set also needs to occur in the Congress. We also 
need to be part of the changing mentality that recognizes the 
crucial role that is played by this acquisition workforce. The 
taxpayers depend on them, we depend on them, and our national 
security depends on them. Most importantly, our warfighters' 
lives and success literally depend on them, too. And I now 
would like to recognize Mr. Wittman.
    [The prepared statement of Dr. Snyder can be found in the 
Appendix on page 35.]

STATEMENT OF HON. ROB WITTMAN, A REPRESENTATIVE FROM VIRGINIA, 
   RANKING MEMBER, OVERSIGHT AND INVESTIGATIONS SUBCOMMITTEE

    Mr. Wittman. Thank you, Chairman Snyder. I appreciate your 
leadership in bringing this issue to the forefront. I also want 
to welcome our witnesses this morning. Thank you so much for 
joining us and taking your time out of your busy schedules to 
provide what I think is a very critical perspective on this 
issue of acquisition reform.
    All aspects of the defense acquisition system are receiving 
much attention these days. It seems to be the popular topic 
here on the Hill. And the President and the Secretary of 
Defense have made acquisition reform a priority. And the 
leaders of both the Senate Armed Services Committee and our own 
Chairman Skelton and Ranking Member McHugh of the House Armed 
Services Committee have introduced legislation to improve the 
system. And there is absolutely no question that any taxpayer-
funded system expending more than $4 billion annually and 
employing thousands of people deserves continuous scrutiny.
    More importantly, though, the long history of armed 
conflict amply demonstrates that the combat force employing the 
most technologically advanced systems from long bows to 
gunpowder to stealth aircraft to the capability to rapidly 
deploy expert marksmen and their equipment from Virginia to the 
Indian Ocean usually prevails. And our national security 
demands that we have a well-funded, well-managed weapons 
acquisition system for our Armed Forces.
    Our focus today is not the system, but its most important 
element: its people. Any complex system requiring sound 
judgment, creativity, and financial prudence needs talented, 
motivated professionals. And what we are really doing is 
assembling a team of inventors, developing and packaging 
capabilities in ways heretofore unimagined, at taxpayer 
expense. It is extraordinarily difficult to produce any new 
capable weapons system, much less produce it on an exact 
schedule, to exacting performance standards, within an exact 
budget. As much as I would like to see more precision, we do 
need to trust good people to make reasonable decisions on this 
Nation's behalf.
    In that regard this committee has initiated several 
legislative measures in the last few years designed to 
strengthen the Department's acquisition workforce. We believe 
these changes are having a good effect, and are eager to hear 
your perspectives on this matter. Even so, we understand 
defense acquisition needs excellent employees and are happy to 
consider any further legislative changes that may be needed. 
Any systemic changes we have will have little real effect 
without a superb core of acquisition professionals to operate 
it.
    Gentlemen, I look forward to hearing your testimony today 
for you to give us your perspective on the things that we can 
do to make sure that our acquisition workforce has everything 
that it needs to perform this Nation's critical, critical 
duties. Thank you so much.
    Dr. Snyder. Thank you Mr. Wittman.
    [The prepared statement of Mr. Wittman can be found in the 
Appendix on page 39.]
    Dr. Snyder. Let me now introduce our witnesses. Mr. Shay 
Assad is the Director of Defense Acquisition Policy and 
Strategic Sourcing. He is the Acting Deputy Under Secretary of 
Defense for Acquisition and Technology. Lieutenant General Ross 
Thompson, Military Deputy, Assistant Secretary of the Army for 
Acquisition, Logistics and Technology. Mr. James Thomsen, the 
Principal Civilian Deputy, Assistant Secretary of the Navy of 
the Acquisition Workforce. Lieutenant General Mark Shackelford 
from the Air Force, Military Deputy, Office of the Assistant 
Secretary of the Air Force for Acquisition. It seems to me, 
General, that you got off easy on the nickname. Shack was 
pretty close for a fighter pilot. They didn't venture far from 
your given name.
    General Shackelford. Yes, sir. It is an easy one.
    Dr. Snyder. Mr. John Needham, Director of the Acquisition 
and Sourcing Issues, U.S. Government Accountability Office 
(GAO). Thank you all for being here.
    Mr. Assad, we will begin with you. We will put on the 
clock. And when you see the light goes red, it means five 
minutes have gone by. If you need to go longer than that, go 
longer than that, but I know members will have questions.
    Mr. Assad, we will begin with you.

 STATEMENT OF SHAY D. ASSAD, ACTING DEPUTY UNDER SECRETARY OF 
DEFENSE, ACQUISITION AND TECHNOLOGY, U.S. DEPARTMENT OF DEFENSE

    Mr. Assad. Mr. Chairman, with your permission I would like 
to include my written statement for the record.
    Dr. Snyder. Yes, sir. All your written statements will be 
made part of the record.
    Mr. Assad. Thank you. Chairman Snyder and members of the 
subcommittee, I want to thank you for the opportunity to appear 
before you and participate in today's hearing. At your request, 
I will address the overall state of the Defense acquisition 
workforce, both military and civilian.
    In the 1990s there was a significant decrease in the size 
of the acquisition workforce; 9/11 and ensuing events have led 
to a significant increase in acquisition workload. These 
factors have strained our current organic acquisition workforce 
capability.
    In 2001 the Department obligated $138 billion in contracts. 
And in 2008, obligations reached $396 billion. In contrast, the 
acquisition workforce decreased from a level of approximately 
147,000 in 1998 to its present state of around 127,000.
    In 2006 we began the journey of assessing the capability 
and needs of our acquisition workforce. This has been and will 
continue to be an evolving process. However, the decisions that 
we have made regarding the growth of our workforce and the path 
that we are now on have been deliberate, thoughtful, and 
forward looking.
    On April 6, 2009, the Secretary of Defense announced his 
intention to significantly increase the capability and capacity 
of the Defense acquisition workforce by increasing the size of 
the workforce by 20,000 through the year 2015. This will 
restore our organic capability to its 1998 levels of 
approximately 147,000 and address longstanding shortfalls in 
the workforce. It is the first significant growth since the 
military buildup in the 1980s and the downsizing that occurred 
in the 1990s.
    This strategy increases the size of the workforce by 15 
percent. We will add approximately 9,500 employees to our 
contracting, pricing, and contract oversight workforce, and 
10,500 in program managers, engineers, quality control, 
logistics, and business management. This will create a better 
balance between our government workforce and contract or 
support personnel, and ensure that employees critical to 
perform inherently governmental functions do so. This strategy 
will increase and improve the Department's oversight 
capabilities, thereby ensuring that we get a better deal for 
the taxpayers, that we get what we pay for, we ferret out waste 
and assist in combat and contract fraud.
    The Defense Acquisition Workforce Development Fund provided 
by Congress is a key workforce enabler. Since enactment, 
significant resources have been targeted for improving the 
Defense acquisition workforce, and we very much thank this 
committee for supporting the Defense Acquisition Workforce 
Development Fund.
    Improvement initiatives are being deployed and are 
characterized in three major workforce categories:
    First, with regard to recruiting and hiring, hiring has 
started and is the primary focus of our strategy. In our 5-year 
plan, approximately 89 percent of the resources of the Defense 
Acquisition Workforce Development Fund will be used for hiring.
    Secondly, concerning retention and recognition, although 
present economic conditions are contributing to better 
retention it is essential to start now to implement a long-term 
retention strategy and talent management strategy as we go 
forward.
    Thirdly, in the area of training and development, 
certification requirements have exceeded the DAU's present 
capacity, and DAU must expand to meet this demand.
    Equally important is the capacity to meet future 
requirements resulting from increased hiring of interns, 
journeymen and highly qualified experts. There are also new and 
evolving training issues, such as expanded expeditionary 
contracting training, contracting officer representative 
training, and training for those who are not part of the 
acquisition workforce but who develop requirements.
    With regard to our military workforce we must ensure that 
our joint contracting workforce is properly sized and trained 
to meet the needs of contracting in a battlefield environment.
    The Army and Marine Corps have taken significant steps in 
terms of training, size, leadership development, and 
organization of their present and future contracting corps. We 
anticipate that the Navy's contracting capability will continue 
to be provided through its Supply Corps and its Civil 
Engineering Corps.
    In terms of contracting capability, we anticipate that the 
Air Force will continue to provide the largest and most 
significant capability among the uniformed services. The 
challenge for the Air Force is, and will be, to provide 
promotional opportunities for their capable acquisition and 
contracting community.
    The Secretary has established an overarching human capital 
strategy to mitigate the impact of past downsizing, increased 
workload, the aging workforce, and to create a better balanced 
multisector force. This is an unprecedented acquisition 
workforce growth initiative. Essential to improving acquisition 
outcomes is a properly sized, highly skilled, ethical and 
professional workforce. I believe this strategy is on target, 
and I look forward to working with you and keeping you apprised 
of our progress.
    Thank you, Mr. Chairman, and members of the subcommittee 
for your support.
    Dr. Snyder. Thank you Mr. Assad.
    [The prepared statement of Mr. Assad can be found in the 
Appendix on page 42.]
    Dr. Snyder. General Thompson.

  STATEMENT OF LT. GEN. N. ROSS THOMPSON, III, USA, PRINCIPAL 
  MILITARY DEPUTY TO THE ASSISTANT SECRETARY OF THE ARMY FOR 
ACQUISITION, LOGISTICS AND TECHNOLOGY AND DIRECTOR, ACQUISITION 
         CAREER MANAGEMENT, U.S. DEPARTMENT OF THE ARMY

    General Thompson. Chairman Snyder, Congressman Wittman, and 
distinguished members of the Subcommittee on Oversight and 
Investigations, thank you for the opportunity to discuss today 
the state of the Army acquisition workforce and our mutual 
efforts to ensure a strong and robust acquisition system.
    I am pleased to report that the Army is making steady 
progress in sustaining and growing an acquisition workforce 
that is focused on getting world-class products and services to 
our soldiers faster, while ensuring proper fiscal stewardship 
of the taxpayer dollars. Our plans are outlined in my written 
statement.
    Mr. Chairman, the Army acquisition workforce declined 
significantly in the last decade, while the workload and the 
dollars associated with that workload increased. At present, we 
have roughly 40,000 workforce members, 38,500 civilians, and 
about 1,600 military to perform the entire acquisition and 
contracting mission for the Army.
    While our workforce members are stretched, they continue to 
excel in meeting the challenges of their jobs. Their energy and 
enthusiasm result from the knowledge that their work is 
critically important to our soldiers in the field. Size, 
structure, training, and experience are critically important 
factors in developing a workforce that is better prepared to 
deal with the complexities of acquisition and contracting in 
the 21st century.
    Our current workforce initiatives highlight right-sizing 
development and recognition and retention incentives. Increased 
investment in our people, coupled with sufficient predictable 
investment in our programs will continue to give our soldiers 
the equipment, services and support they need for success on 
the battlefield.
    Before I conclude I want to point out that yesterday we 
discovered a factual error in my written statement. We provided 
the correct information to your staffers, and we will provide a 
revised statement for the record.
    This concludes my opening remarks, Mr. Chairman, I look 
forward to your questions.
    Dr. Snyder. Thank you, General.
    [The prepared statement of General Thompson can be found in 
the Appendix on page 53.]
    Dr. Snyder. Mr. Thomsen.

 STATEMENT OF JAMES THOMSEN, PRINCIPAL CIVILIAN DEPUTY FOR THE 
   ASSISTANT SECRETARY OF THE NAVY, RESEARCH DEVELOPMENT AND 
            ACQUISITION, U.S. DEPARTMENT OF THE NAVY

    Mr. Thomsen. Mr. Chairman, distinguished members of the 
subcommittee, I am Jim Thomsen. It is a privilege for me to 
appear before you here today, along with your fellow panel 
members, to discuss a very, very important topic of acquisition 
workforce. About eight months ago I was asked by the Secretary 
of the Navy to leave my post as the program executive officer 
for littoral warfare and move over to serve on the Department 
of Navy's staff for the service acquisition executive, 
Secretary Stackley, as his principal civilian deputy. Together 
with his principal military deputy, Vice Admiral Architzel, we 
serve as Secretary Stackley's military-civilian senior 
leadership team to address acquisition challenges.
    My particular focus, though, since I arrived on the scene 
just a few months ago, has been on resetting and rebalancing 
the Department of Navy's acquisition workforce, along with the 
team that we have in the Defense Acquisition Career Management 
Office in the Navy. That particularly includes technical 
workforce at our Naval Warfare Centers and Naval Research Lab, 
in addition to the business skills and sets that we have in our 
workforce.
    As you know, we didn't arrive at this place with our 
acquisition workforce overnight so it will take some time to 
reset the workforce in an appropriate way. Having said that, 
the people we have in our acquisition workforce today are 
outstanding in what they do every day. They truly do amazing 
work to produce the products that we produce. But they do need 
our help in strengthening the team to provide an even better 
set of outcomes in acquisition.
    We believe in the Department of Navy we have taken a number 
of steps to get out ahead of the problem, including a more 
thorough understanding of our workforce strengths and 
weaknesses, military and civilian, and identifying the critical 
gaps within each of our Materiel Commands. We do have a plan to 
grow the acquisition workforce, and it is consistent with the 
Office of the Secretary of Defense (OSD) workforce plan as 
well. In fact, we are doing so this year to build a workforce.
    So the recent actions taken by the Congress we believe 
will, in fact, reinforce our ability to address these gaps 
appropriately. The details are in the Department of the Navy 
written statement I provided. But, again, thank you for the 
opportunity to appear before you here today, and I look forward 
to addressing your questions. Thank you, Mr. Chairman.
    Dr. Snyder. Thank you.
    [The prepared statement of Mr. Thomsen can be found in the 
Appendix on page 66.]
    Dr. Snyder. General Shackelford.

 STATEMENT OF LT. GEN. MARK SHACKELFORD, USAF, MILITARY DEPUTY 
TO THE ASSISTANT SECRETARY OF THE AIR FORCE, ACQUISITION, U.S. 
                  DEPARTMENT OF THE AIR FORCE

    General Shackelford. Mr. Chairman, distinguished members of 
the subcommittee, thank you for the opportunity to address this 
subcommittee and to discuss Department of the Air Force's work 
to improve the capacity and capabilities of our acquisition 
workforce. I am confident that the Department's ongoing actions 
and those planned through the future years' defense program 
will improve the Department's ability to effectively execute 
the acquisition mission.
    I would like to take a few moments to touch on several of 
these efforts. In October 2008, Air Force leadership identified 
recapturing acquisition excellence as one of the top priorities 
that will shape Air Force-wide actions over the next three to 
five years as we address actions that strengthen people, 
processes, and policy. Developing, recapitalizing, and shaping 
our professional acquisition workforce is integral to 
acquisition excellence.
    To guide our efforts towards this vision, we partnered with 
Air Force acquisition functional leaders in the Acquisition 
Commands to develop an Air Force Human Capital Strategic Plan 
for the acquisition workforce, which was published in February 
of this year. This plan establishes a strategic vision for a 
professional acquisition workforce with the right number and 
mix of people, with the right education, training, skills and 
experience, to effectively and successfully perform the Air 
Force acquisition mission. We believe it is an excellent 
roadmap for guiding workforce development in support of 
acquisition excellence.
    The Department of the Air Force is fully committed to 
acquisition excellence and appreciates the efforts of the 
Congress to considerably improve our ability to develop and 
recapitalize our acquisition workforce. We are aggressively 
using the authorities resources provided in legislation. They 
are key enablers for our Workforce Strategic Plan.
    Again, I appreciate the opportunity to testify in front of 
you today and ask that the remainder of my statement be placed 
in the record. I look forward to your questions.
    Dr. Snyder. Thank you, General.
    [The prepared statement of General Shackelford can be found 
in the Appendix on page 74.]
    Dr. Snyder. And Mr. Needham.

    STATEMENT OF JOHN K. NEEDHAM, DIRECTOR, ACQUISITION AND 
   SOURCING MANAGEMENT, U.S. GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Needham. Thank you, Mr. Chairman, Ranking Member 
Wittman and members of the subcommittee. I appreciate the 
opportunity to discuss GAO's recent work on DOD's acquisition 
workforce. As the largest buying enterprise in the world, DOD 
spent $388 billion for goods and services in fiscal year 2008. 
The acquisition workforce, now numbering approximately 178,000 
people, is DOD's key asset in obtaining value for the taxpayer. 
So building and sustaining it in the years ahead is critical.
    Doing this well requires quality information that will 
provide DOD the insight that it needs. My statement today 
focuses on the information limitations that DOD has on its 
acquisition workforce, as well as recent efforts it has taken 
to improve management and oversight of this workforce.
    I will also highlight some additional actions the 
Department could take to better ensure its workforce could 
fulfill DOD's mission and make the most of taxpayer dollars.
    First, DOD lacks information on contractor personnel. DOD 
recently began to collect such data and has determined that 
these contract workers comprise roughly a third of the 
acquisition workforce, a finding consistent with our own review 
of 66 program offices. While this is a start, we believe that 
DOD needs visibility into the reasons program offices use 
contractor personnel; because without this, the Department 
cannot determine if decisions to use contractors are 
appropriate and beneficial. We found decisions to use 
contractor personnel are often driven by factors such as 
quicker hiring times and civilian staffing limits, not the 
nature or the criticality of the work.
    Second, DOD lacks complete information on the skill sets of 
its in-house personnel and other information such as the size 
and composition of the acquisition workforce that is required 
to meet its many missions. Lacking this information not only 
skews analysis of workforce gaps but limits DOD's ability to 
make informed workforce allocation decisions and determine 
whether the total acquisition workforce that is both in-house 
and contracted personnel is sufficient to accomplish its 
mission.
    Recent and planned actions could begin to address many of 
these challenges that DOD faces in assessing and overseeing its 
workforce, its plans for hiring, recruiting, and retention 
activities. In addition, DOD plans to convert 11,000 contractor 
personnel to government positions and hire an additional 9,000 
government personnel by 2015.
    Ensuring it has the capacity to acquire needed goods and 
services and monitor the work of its contractors rests on DOD's 
willingness to develop comprehensive information about 
contractor personnel, including the skill sets provided, the 
functions they perform, or the length of time for which they 
have been used. Without this information, DOD runs the risk of 
not having the right number and appropriate mix of civilian 
military and contractor personnel to manage its acquisitions. 
Furthermore, there needs to be guidance on the appropriate 
circumstance under which contractor personnel may perform 
acquisition work as well as tracking the implementation of this 
guidance. Without it, DOD runs the risk of not maintaining 
control over and accountability for mission-related policy and 
program decisions.
    What should DOD do? In our March 25, 2008 report we made 
several recommendations to the Secretary of Defense aimed at 
minimizing these risks. DOD generally concurred with the 
recommendations. And in taking steps to determine the number of 
contractor personnel in its acquisition workforce, it has 
already begun to address our first recommendation. However, the 
Department has noted that collecting information on contractor 
skill sets and length of service requires careful 
consideration.
    While we agree that moving forward will entail thoughtful 
deliberation, it is critical that the Department take action to 
obtain additional data on its contractor personnel in order to 
accurately identify and appropriately address its Air Force 
gaps.
    Secondly, DOD needs better insight into why program offices 
elect to use contractor personnel over in-house personnel. As I 
mentioned earlier, providing guidance that clarifies the 
appropriate circumstances under which contractors may perform 
acquisition work and then tracking the implementation of that 
guidance would go a long way toward increasing this insight.
    Finally, DOD must identify and update on an ongoing basis 
the number and skill sets of the total acquisition workforce 
the Department needs to fulfill its mission. As DOD moves 
forward with its plans to increase the size of the workforce 
over the next few years, having comprehensive information about 
the workforce it both has and needs is even more vital if it is 
to make effective decisions that create, and not diminish, the 
capacity to manage the largest and most complex buying activity 
in the world.
    Mr. Chairman, this concludes my statement. I would be happy 
to answer any questions you or any members of the subcommittee 
may have.
    [The prepared statement of Mr. Needham can be found in the 
Appendix on page 82.]
    Dr. Snyder. Thank you all for both your written and oral 
statements. We will now begin our questions.
    Mr. Wittman, we put ourselves on the five-minute clock, and 
so I will begin. And then we will go around to members and we 
will probably go, I suspect, three rounds or more this morning.
    Mr. Needham, I want to begin by asking you one specific 
question. You specifically talk about, I think it is on page 12 
of your statement, about--on the chart--the drop from 2001 to 
2008 in total acquisition personnel. I think most of us are 
familiar with what occurred post-Cold War in the 1990s. But the 
drop continued through 2001 to 2008. How did that come about?
    Mr. Needham. Well, that drop continued because they 
essentially had cut back through ceilings, personnel ceilings, 
and so forth. But they also began to meet that need through use 
of contractors, which is where our focus had been in this 
recent report we did, was on the use and the growth of those 
contractors and getting a sense of how big that contractor 
workforce is. We never had really a good picture of what that 
growth rate is, so we just had a picture of what the civilian 
and military side looked like in terms of its decline.
    Dr. Snyder. So while we saw this continued drop--I mean, it 
is not tremendously dramatic, but a time of, as you pointed 
out, big increases in the amount of contracted services and a 
lot of activity going on with the war on terrorism and the wars 
in Iraq and Afghanistan. This chart just demonstrates that a 
lot of the work was being done by a contracted-out force.
    Mr. Needham. Right. But we didn't have, again, the numbers 
to know that, to be able to identify, which has been an effort 
of Congress over the recent years to get that kind of 
documentation down.
    Dr. Snyder. I still find it surprising that the actual 
numbers have declined of personnel through that 2001 to 2008 
period. I want to ask, I am going to ask this a little bit--I 
will not facetiously, I guess. There is not much humor, it 
doesn't seem to me, in an acquisition hearing, so I have got to 
find it the best I can.
    But it seems to me, knowing you watch these movies about 
prisoner of war (POW) camps, you know, the kind of tongue-in-
cheek kind of stories, the coolest dude in the camp is always 
the acquisition guy, is the guy who can find the radio and the 
phony ID and the two pounds of sausage and whatever it is the 
commander thinks he needs. So you guys are the coolest dudes in 
the camp.
    Now, that is the mind-set I think that this panel has. The 
problem is how do we change the mind-set in such a way that we 
don't forget that you are the coolest dudes in the camp? What 
will happen 5 years from now, 8 years from now, 10 years from 
now when there will be another group of people sitting here who 
will start talking about, well, we have got to look at our 
tooth to tail ratio, and we look in the tail and we see these 
people that they are not really warfighters. We can get rid of 
these folks.
    How do you change the mind-set, and how well do you all 
think you are doing to change the mind-set, that we recognize 
without you all and the work of the people that you supervise, 
our military could literally come to a stop?
    I would like to go down the row. We are talking about the 
mind-set now, the culture, that you all work in. Mr. Assad.
    Mr. Assad. Mr. Chairman, I think it is in two perspectives. 
The first is the overall acquisition workforce. The reality is 
that the Secretary of Defense and Congress have been very 
supportive of now moving forward and doing some very positive 
things with our acquisition workforce.
    We are going to have to demonstrate to our Secretary and to 
the President and to you that the investment that you are going 
to make in that workforce is in fact going to pay off, that we 
are going to get better deals for the taxpayers, that we are 
going to conduct more robust oversight, that in fact when we 
encounter fraudulent activities we root them out and we deal 
with it. So it is going to be in the proof of the pudding over 
time as to whether or not the investment that the Secretary of 
Defense, the President and ultimately the Congress makes in 
this workforce will in fact pay off. We believe it will.
    In terms of the military, there is no doubt that we have 
seen our folks who have their boots on the ground, our 
soldiers, marines, airmen, and sailors, are performing in an 
incredible and outstanding way. But they are taxed in terms of 
their contracting capability, because we just don't have 
sufficient military resources to deal with contracting in a 
combat environment as it is presently envisioned. We will 
continue to have contractors who support our operational 
forces. So the need to have capable, competent professional 
military contracting officers is going to continue on.
    And I think, again, it will be in our demonstration to our 
leader, the Secretary of Defense, the President, as well as to 
Congress, that in fact the investment that you make in both the 
civilian and military workforce will in fact result in a more 
effective--and, frankly, get a better deal for the taxpayers 
than we presently have been.
    Dr. Snyder. General, I think what I will do, because the 
time is up, I think I am going to go to Mr. Wittman, and we are 
going to pick that up the next round. Mr. Wittman.
    Mr. Wittman. Thank you, Mr. Chairman. Gentlemen, thank you 
again.
    I wanted to direct a couple of questions, actually four in 
total, to both Mr. Assad and Mr. Needham. Secretary Gates, as 
you know, announced that he intends to add 9,000 personnel to 
the in-house acquisition workforce and to convert 11,000 
acquisition-related contractor positions to government 
positions. And this will bring the in-house workforce back to 
where it was in 1998.
    Can you comment a little bit on why 1998 is a meaningful 
baseline, and will the workforce be overseeing a workload of 
comparable value or complexity, and do we know what the level 
of contractor support was in 1998? And if you could give us a 
little bit of background maybe on the analysis that you put 
forth to look at this 1998 baseline and the determinations you 
made as to why that is applicable today?
    Mr. Assad. Yes, sir. In terms of the contracting workforce, 
the 9,000, 9,500, professionals that we will be adding in that 
environment, what we did was we actually had some pretty 
detailed bottoms-up estimates in terms of what we needed at 
Defense Contract Management Agency, Defense Contract Audit 
Agency. We looked at each of the services in terms of their 
contracting capabilities, and we knew that in general that part 
of the workforce does not have a contractor segment associated 
with it. There are some organizations that do have contractors 
supporting those environments but they are very small. It is a 
much different picture.
    To give you an example, of that 52,000 contractors that we 
think, approximately 52,000, that support the acquisition 
workforce, somewhere between 500 and 700 support the 
contracting or contract oversight workforce, so it is a very 
small number.
    So in that particular case the way we looked at that 
workforce was really in terms of examining its capabilities. 
And we just completed it. It took us 18 months to complete 
probably the most comprehensive competency assessment of that 
workforce that has ever been done in Federal Government. That 
was created. Over 18,000 folks participated in that. And that 
was completed recently. So we have the information that we need 
to look at that part of the workforce in a very detailed way.
    In terms of the contractor workforce, we knew that we 
needed to change the mix of the workforce. We think that the 
total size of the workforce in general is adequate because we 
are getting the job done with our contractor contracting 
workforce. But what we needed to do was take a more, I think, 
realistic view of what we believe is inherently governmental 
and ensure that those functions are in fact being supported by 
Federal civilians and/or our military workforce. We needed to 
ensure that we have the engineering capability inherent within 
government so that we can provide the proper technical 
assessments to our contracting officers, so at the end of the 
day we get a better deal for the taxpayers and, in fact, we can 
conduct proper oversight.
    Going back to the 1998 levels, we simply use that as a 
measure of that really was the point, it was about a year or 
two before we began a significant increase in the workload of 
our workforce. So in reality, while we are going back to the 
1987 level, we are adding more contracting folks in that 
environment.
    Mr. Wittman. Mr. Needham.
    Mr. Needham. We issued a number of reports at that period 
of time. A lot of the reforms that had started in the 1990s 
started to come to fruition in the 1990s. Mr. Assad's point, 
though, in terms of picking 1998, that was their reason. I know 
at the time when we were looking at this, that was a period 
where there had been a lot of effort at reinventing government, 
rethinking how processes are working and so forth, and a lot of 
changes had come about at that point. But that is the only 
insight that we have into that.
    Mr. Wittman. Thank you, Mr. Chairman.
    Dr. Snyder. Mrs. Davis for five minutes.
    Mrs. Davis. Thank you, Mr. Chairman, and thank you all for 
being here. I wanted to just pick up on that for a second. I 
think that we all know that we do best when we learn from our 
mistakes. And what I am wondering is, as we move forward, why 
there wasn't the pushback to some of those moves and whether or 
not our non-acquisition workforce was not in a position to 
really say, hey, wait a second, you know, we need some more 
help out here and the decisions that are being made are not 
helpful. I don't know if you would like to comment on that sir.
    Mr. Needham. Thank you. Representative Davis, if you will 
think back at that point, I think when a lot of the changes 
came about in the acquisition workforce, there was a feeling 
that the acquisition workforce was cumbersome, it got in the 
way of acquisitions; and that view, whether it was correct or 
incorrect, probably governed a lot of decisions. And I know 
that at the time there was a great deal of emphasis on 
outsourcing and using contractors. And there was a view that 
you were either going to save money or you were going to get it 
done more efficiently or you were going to be able to get the 
kinds of skills.
    What drove those decisions, though, were not key factors in 
terms of what the criticality of the workforce is, and that is 
what should be driving them: concerns about inherently 
governmental, concerns about cost and so forth.
    Mrs. Davis. I think what I am looking for is how we can 
read this in the future, then, if in fact there is an effort, a 
move to say, well, you know, we are okay now, now we can begin 
to cut back again; and whether--is it the governmental 
workforce that would be an indicator if you saw a drop in that 
at some point?
    Mr. Needham. What really needs to occur, and this is 
something that goes back to--GAO started writing about this in 
the 1970s--we need to have accurate descriptions of what the 
needs are. If you have a certain amount of a mission, what does 
that mission require in terms of all kinds of personnel, but 
especially with the acquisition and the kind of skill mix that 
you have. From there you then go back and then try to decide 
what kind of a mix you want. But you really need to focus on 
what the needs are and not let the budget drive it as much as 
what the real needs are. And if the needs exceed the budget, 
then there has to be some tradeoffs made at that point.
    Mrs. Davis. I appreciate that. In your report you seem to 
indicate that you had some problems getting information.
    Mr. Needham. Not that they weren't providing it. They just 
didn't have it. And in fact DOD over the past several years has 
been developing that kind of information that they need to 
have. And we are looking at that as they go forward. They have 
plans together. In fact, they just announced recently the 
52,000 count they have for the acquisition support personnel 
that they have as contractors.
    Mrs. Davis. I wanted to just turn for a second to the non-
acquisition community, and certainly to how in fact we may be 
training and educating people to appreciate the role of the 
contractors in contingency operations. Are we able to do that 
so that those commanders in the field, the field commanders, 
can really appreciate what is happening? Is that something 
important to do, and where are we in that specific role?
    General Thompson. Let me take a stab at answering that 
question. It is critically important that the non-acquisition 
personnel in DOD, both military and civilian, recognize the 
importance of the acquisition functions, not just contracting; 
it is all those acquisition career fields.
    And I will answer Congressman Snyder's question as to how 
do you change the mind-set. You have got to value and trust the 
people, it is that simple. If everything that they read is 
about how screwed up acquisition is, it begins to affect your 
mind-set after awhile. And so GAO and other audit agencies, 
Inspector General (IG) agencies, have got to not just find the 
things that are wrong, they have got to find the things that 
are right, and they have got to write about those and give 
people credit for doing the good things. It is like raising 
kids. If you criticize your kids every time they do something 
and never reinforce them with the positive things it is going 
to have a certain effect. And so you have got to value the 
people.
    We are training the non-acquisition members in the DOD, in 
particular in the Army, the commanders, to recognize their role 
in defining requirements. And when you buy something, whether 
that is a good or a service, the first thing you have got to do 
is what do you want to buy; define what it is, when do you want 
it, how much you are willing to pay? And there is a role to 
play in that. And the acquisition workforce has got to help 
them define those requirements in a clear way so when we go out 
and negotiate for that good or service, we get what they want 
and it meets their expectations.
    Mrs. Davis. Did you want to comment quickly?
    Mr. Thomsen. Just to add to that, ma'am, in the Department 
of Navy--it is a great point--is that we have really got to 
inculcate the culture of importance to acquisition and what we 
buy to the rest of the Department.
    One of the things that we have just initiated over the last 
really just six months is that the Department of Navy has 
executive business courses for all of their flag officers. The 
Marine Corps has the same thing for their general officers. We 
have made a very pointed, deliberate attempt--and we have--to 
meet in those classes and walk them through, soup to nuts, why 
acquisition is important and really why the acquisition 
workforce is important.
    The Department of Navy, the acquisition workforce, 
represents about eight percent of the total force, but in fact 
we really execute about 40 percent of the total obligation 
authority given to us by the Congress. So it is important 
enough that the rest of our Department of the Navy organization 
understand that.
    Now, we have started that process at the very top levels 
down through really the 2005 billets and then press that down 
through the rest of the enlisted rank. So it is a great point.
    And piling onto General Thompson's point, unless we can 
make sure that people recognize this throughout our 
organization, we are going to continue to get just less than 
enthusiastic support for the acquisition work that really is 
done by our great workforce.
    Mrs. Davis. Thank you. Thank you, Mr. Chairman.
    Dr. Snyder. Mr. Jones for five minutes.
    Mr. Jones. Mr. Chairman, thank you very much. And I want to 
thank each one of you at the table for your presentation. And 
some of us have been here, I was elected in 1994 so I have been 
here, sworn in in 1995.
    Mr. Assad, I appreciate your comments, and I will tell you 
why. It seems like every year--I have been on Armed Services 
for eight terms now, and not just talking about acquisition 
workforce, but any--I guess any segment of the services, any 
segment of the Department of Defense. I remember when Donald 
Rumsfeld came here before the Armed Services Committee in 2001, 
I guess, or whenever it was, and basically said that he was 
making a commitment that every dollar of the taxpayer was going 
to be protected. And I realize nothing is perfect in life. It 
is just not. But when I sit here and listen to the commitment 
that Secretary Gates--and I have great respect for Secretary 
Gates and his team, quite frankly, and I think we are very 
fortunate to have him and his team, and I look forward to his 
presentations in the weeks and months to come about his 
suggestions to make the military more efficient, to make the 
Department of Defense work even better.
    But I was sitting here thinking--and, Mr. Needham, this 
might really be--if there is any question in my rambling, it 
might come back to you. But I think David Walker 10, 12 years 
ago, made the statement that if you are really going to do 
anything meaningful at the Department of Defense, because of 
the size, the enormity, of the Department of Defense and the 
different agencies within and all the size of the machine, if I 
can put it that way, that if the Congress was going to ever be 
able to get a handle on how to make it more efficient, then you 
probably needed to appoint an individual who is qualified for 
the full term of a President. Of course, no President knows if 
he is going to be there four years or eight years, but assume 
an eight-year term and put this person in who has the 
qualifications to work within the system--it is not just one 
man, but he would have his people--to try to get a handle.
    I feel like today I have heard that obviously some 
recommendations made by GAO have been followed, some 
recommendations within the Department itself which have made 
things a little bit better. But the size of the whole 
Department--and we are talking about the acquisition workforce 
today--but all in all it seems like what I am hearing I have 
heard before.
    Now, some changes have been made. That is not a criticism. 
But it looks like to me you have got to have a major commitment 
by an administration. And even if that administration thinks 
they are going to be there eight years--I am not talking about 
the current administration--but if they think they are going to 
be there eight years, if they put this type of plan in place 
where this individual had the expertise with the commitment and 
the help of people within the military and outside the military 
that just think that the system needs to be reworked, is there 
any way to make it work better than what it is doing now with 
the current structure that we have, or will it continue to be a 
kind of hit-and-miss improvement?
    I just don't know how you get a handle on this unless you 
make some major decision by the Congress and the administration 
that you are going to have to make a six- or eight-year 
commitment to get the efficiency, or at least get it started in 
the direction of efficiency.
    And again, this is not a criticism. I have the greatest 
respect for the military and the Department of Defense, but are 
we going to continue to hear the same thing if we don't do 
something just really drastic?
    Mr. Needham. What Mr. Walker was talking about at the time 
was the idea of having a chief management officer for the 
Department. And really this came from looking at our analysis 
of the turnover among program managers. And we showed program 
managers where you might have one President and two Secretaries 
of Defense and you would have five program managers for a 
particular function. And it was maintaining continuity and 
focus at a high level that was irrespective of the political 
climate they were working in. They were basically concerned 
with the administration of the Department. That is something 
that still is something that we view not only for the 
Department of Defense but for the other departments as well.
    My own experience has been I have gone into meetings with 
Defense officials, and one program I was looking at was the 
purchase of commercial satellite services, and the program 
people turned over, the political people turned over, the 
military people turned over, but I had the same contractor all 
the way through. And it was something that--it was the only 
source of continuity we had as we dealt with them over a three-
and-a-half-year period as we went back for more and more 
information. And that is probably the key thing, is keeping 
people in place so they can actually get some changes done. And 
I know there has been some thinking about that within DOD about 
kind of limiting the amount of turnover that does occur.
    Dr. Snyder. Mr. Franks for five minutes.
    Mr. Franks. Well, thank you, Mr. Chairman, and thank all of 
you. There is no way to ever express the appropriate gratitude 
for those of you that slog through the challenges to make sure 
that we are prepared in terms of personnel for whatever comes. 
I suppose in many ways that is the most critical job in the 
service. Not only does personnel equal policy, as they say, but 
the people that you choose to be in leadership roles and to 
carry out this Nation's defense is just an incredibly important 
job, and I commend you for it, as always.
    So I guess I probably would go ahead and just ask each of 
the services, the representatives of the services, beginning 
with you, General Thompson, among the ranks, your ranks of 
acquisition professionals, where do they feel and where do you 
feel the most pain? What is your greatest shortage in both 
numbers and expertise, what is your biggest challenge?
    General Thompson. The biggest challenge I think is being 
addressed by the plans to grow the size of the workforce. For 
the scope of the work, the complexity of the work today, the 
acquisition workforce, both military and civilian, needs to be 
larger. And the plans that we are putting in place across the 
DOD to do that I think will address that.
    There are 13 different acquisition career fields. It is not 
just program management and contracting and engineering, but 
there is business and cost estimating and life cycle logistics. 
And we have looked at the gaps in those workforce areas, and we 
have got the plans in place to grow the size of those different 
acquisition categories appropriately to be able to address the 
challenges and to be able to meet the requirements of the Army 
and to be able to meet the requirements of the Department of 
Defense.
    Mr. Franks. Thank you, sir. Mr. Thomsen, do you have any 
perspective?
    Mr. Thomsen. Yes, sir. Just like the Army, we have gone 
through a review of all of the 13 categories, and then some, to 
look at what our gaps and critical needs are. For us it is 
really in two areas, and arguably three.
    The first area is really in system engineering, not just 
engineering but really qualified system engineers. Why is that? 
Because we really believe in the Department of the Navy that we 
need to reclaim, if you will, much of the technical and cost 
trade space in the early parts of these programs, certainly 
pre-Milestone B, before you really award these large 
development contracts or reproduction contracts. So qualified 
system engineering is really number one.
    Number two is really in contracting officers, to make sure 
that we are reasonably healthy there, but we do need some 
growth in that area.
    And then, thirdly, is business and cost estimating. If I 
can go back to the first one, which if I team up my system 
engineers with necessary and requisite additions and cost 
estimating, I am going to be much better prepared to walk into 
both contract negotiations and really a milestone decision on 
behalf of the taxpayer whether we should buy this system or 
not.
    So I mentioned three, but two of them for sure we need in 
the front part of these programs. To understand the cost and 
technical trade space, to own it inside the government, with 
industry, not apart from industry, but with them, to really be 
peers with them before we enter these large contracts.
    Mr. Franks. General Shackelford.
    General Shackelford. Sir, thank you. When I get outside of 
the Washington environment and go see the Air Force's 
professional acquisition workforce, what I find is a great deal 
of enthusiasm for the work that they do and a great deal of 
pride in the products that they get out that help our 
warfighters.
    That said, they are very sensitive to the decline in the 
numbers of people that we have had during this time period that 
we have been discussing during the panel this morning. And they 
see, in terms of hope, the uniformed effort that is coming out 
of Congress, the Secretary of Defense, and Air Force leadership 
to go and do something about that now.
    The specific areas that, as we look at the acquisition 
workforce and would like to see greater numbers and better 
skills, would be contracting, cost estimators, cost analysts, 
as well as systems engineers. And those are the areas that we 
have targeted, both with the new accessions to the Defense 
Acquisition Workforce Develop Fund, as well as the hiring that 
we have going on right now to fill the vacant positions we have 
and to take advantage of the authorities that we already have.
    Mr. Franks. Thank you, General.
    Mr. Assad, I will try to squeeze in one more question here. 
I have a concern about the 73 percent of the Department's 
acquisition workforce who are baby boomers. I just slid in the 
narrow end of that. And you mentioned that your implementing an 
intern program is a key part of the strategy to balance and 
develop that experienced workforce. But 73 percent is a big 
number. And what other initiatives do you think may assist you 
in dealing with that dearth of experience that will certainly 
be coming?
    Mr. Assad. Mr. Congressman, we are looking at it in several 
different ways. The authority that Congress gave us in terms of 
our ability to hire under the Defense Acquisition Workforce 
Development Fund enables us not just to hire interns but to 
hire those at the intermediate level and highly qualified 
experts. And so each of the services is targeting a number of 
hires at both not just the intern level, but at the 
intermediate and senior level.
    The fact is that between levels of experience of about 7 
and, let's say, 19 years, that is our biggest area where we 
have a shortfall. We are doing a great job of bringing interns 
in and, frankly, hiring people on the front end. So we are 
looking at it through how do we get some of the experienced 
workforce that, frankly, left our organizations and went into 
industry.
    Secondly, how do we look to retain some of those baby 
boomers that might have considered retirement but now are 
either reconsidering, how do we look at retired annuitants who 
can be a tremendous source of mentoring and assistance to our 
workforce as we grow it? There is no doubt that the bulk of our 
hiring is going to be in the intern side of the street. But on 
the other hand we are very comfortable, given what is happening 
in today's workforce environment, that there are a number of 
talented people out there who we can attract to the Federal 
acquisition workforce and then train them with the basic skill 
sets they have to be very effective in our world.
    Mr. Franks. Thank you, Mr. Chairman.
    I thank all of you very much.
    Dr. Snyder. Thank you, Mr. Franks.
    General Shackelford, I think the others have commented, I 
don't think you have commented specifically on the issue about 
the mindset. Do you want to add anything to the discussion?
    Mr. Shackelford. Yes, sir. As I mentioned, once we get 
outside of the Washington area, where the execution of 
acquisition goes on in the Air Force, I find just an incredible 
amount of enthusiasm amongst our people there. They are very 
proud of what they are doing. They see the effects of the 
products that they deliver to the Air Force in the war every 
day.
    That said, they would be the most sensitive people to this 
decline in the numbers of people and some of the atrophying of 
skills that have taken place over about the last 10 years or 
so. So they are the ones that are working under that burden. 
And they see the press, as was mentioned here, often couched in 
terms of what is broken and not what is really working well. 
The fact of the matter is that the far majority of the Air 
Force acquisition goes out and executes every day and does it 
extremely well, and that just doesn't get the press because it 
is successful.
    Their sensitivity to the numbers and the workload, though, 
is being tempered, I think, at this point, really with the 
interest that the Congress is showing in acquisition. The 
Secretary of Defense is taking it very seriously. The Air 
Force's secretary and chief of staff are taking this very 
seriously, to the point that they are making this one of the 
five top priorities of the Air Force. That is a source of great 
encouragement to them, because they see now that the leadership 
actually recognizes the problem and is wanting to do something 
about it.
    So, as we ride that wave out into the future through the 
hiring that is coming through the workforce development fund, 
as we look at the other things we are doing in the Air Force to 
recapture acquisition excellence, I think we are going to see a 
boost in terms of their enthusiasm as well as their 
performance.
    Dr. Snyder. And the issue, though, is it is not just their 
enthusiasm; it is the enthusiasm of everybody else, so that 
they will be valued and, you know, 18 years from now, if we 
have budget problems, they won't be the first people we look to 
cut and say, ``Oh, we can contract this out'' or something. But 
we just need the President and the Secretary of Defense just to 
say they are the coolest dudes in camp. That is all.
    I wanted to ask and maybe hear from the three service 
representatives, if you would talk briefly about the issue of 
career paths and where we are at with regard to general and 
flag officer billets and if the people coming into those fields 
that you all were mentioning sense that this is something that 
they can have a successful career in.
    I will start with you, General Thompson, and just go down 
the row.
    General Thompson. Sir, that is a great question.
    First, I would like to say thank you to the Congress for 
specifically authorizing the Army in the last authorization act 
an additional five general officer billets in the acquisition, 
specifically for contracting.
    You know, we have conducted two promotion boards this past 
fiscal year. The results have not yet been released. And I 
think when those results are released and the selections are 
approved by the Congress, you will see that we have done the 
right thing in selecting, you know, very qualified officers 
with contracting background to begin to put them in those 
critical billets.
    As the senior military acquisition official, I have 
responsibilities for managing that acquisition workforce in the 
Army. There are about 65 general officers and members of the 
Senior Executive Service that I specifically manage. And we 
have been able to, in the last year, in each of our Program 
Executive Offices (PEOs), we had--the PEO, who is the two-star 
general officer or the two-star equivalent Senior Executive 
Service (SES) that manages that portfolio of programs, we have 
been able to establish a flag-officer-level position, either 
SES or general officer (GO), in every one of those PEOs, so 
that there are two senior officials in every one of those 12 
portfolios of programs in the Army.
    So I think that the young military and civilian acquisition 
professionals that come in see that this is a viable career 
path and that there is a way to get to the top of the pyramid, 
provided they do a good job in all of their assignments. And we 
have been able to increase the senior-level ranks 
appropriately, both for the general officers and for the 
members of the Senior Executive Service.
    Dr. Snyder. Mr. Thomsen.
    Mr. Thomsen. Yes, sir. Today we have about 25 percent of 
all of our flag billets in the Navy are actually AP billets--in 
other words, acquisition professional. We have about 180 Senior 
Executive Service members, like myself, that are in acquisition 
professional billets. So that is about half of all of our 
Senior Executive Service billets.
    So the line of sight to flag officer billets--and, in the 
Marine Corps case, there are also some general officer billets 
in acquisition now--but also in the civilian corps, we have 
about half those billets, of all of our billets, are 
acquisition. So the line of sight to that is pretty healthy, we 
think, and we think we have that about right.
    But the thing that really, I think--and we just looked at 
this this year in even more detail--is, what are the promotion 
rates, getting into these flag billets, apart from just 
acquisition? How does acquisition flag promotion rates really 
compare to non-acquisition?
    Actually, this past year, it was better than non-
acquisition. So I think that is a pretty good indicator--we 
think we are in the right ballpark for that. I don't think we 
need to make any significant changes to it. So I think it is a 
pretty good sign we have it about right.
    Dr. Snyder. Mr. Shackelford, if you could briefly respond, 
and then we will go to Mr. Wittman.
    General Shackelford. Yes, sir. The Air Force has 27 general 
officer positions in acquisition, as well as--actually, 27 
qualified acquisition general officers, as well as 87 SES 
acquisition qualified people. So we have a healthy pyramid that 
gets to those positions, with the exception, perhaps, of 
contracting, which we need to work on, and we recognize that.
    As part of this recapturing acquisition excellence, our 
chief and secretary have sent us off to go look at the 
acquisition corps within the Air Force and make an assessment 
of how we are doing in that pyramid in terms of promotion 
opportunities and bringing the right people with the right 
skills up through that process up into those senior positions.
    And so, they are looking at that right now in terms of the 
mix. They are the ones that make the choices for us as to where 
we put our general officer positions, for instance. But part of 
this review will determine how we do in terms of either 
plussing up the number of acquisition general officers or 
having SESs perform those duties based on what the senior 
leadership recognize as their needs.
    Dr. Snyder. Thank you.
    I misspoke. We will go to Mr. Sestak for five minutes.
    Mr. Sestak. Thank you, Mr. Chairman.
    General, first, thanks for coming to the district and 
helping us out up there. I appreciate it very much.
    General Shackelford. Yes, sir. My pleasure.
    Mr. Sestak. I am sorry I wasn't here earlier, but if I 
could ask, do you think one of the--the GAO report appeared to 
say that--for me, the key word was ``oversight.''
    If I could ask more from a parochial experience, in the 
Navy, you have at Naval Sea Systems Command (NAVSEA) technical 
authorities responsibility. Is it really more that we don't 
have enough expertise within the contracting, towards the 
acquisition, the procurement? Or is it really more in the 
failure to have the proper oversight of this, for whomever 
executes it?
    Maybe an example might be how we had to put the LPD-17 out 
of a shipyard down there in the south and move it to somewhere 
else.
    Is the real word not ``how many'' or ``contracting'' or 
``procurement,'' but ``oversight''?
    Mr. Thomsen. In a word, yes, sir. But it is a combination 
of things.
    I had mentioned earlier that, prior to these large 
contracts being awarded, we also believe in the Department we 
have to do a better job of really understanding the technical 
and cost trade space before we get to that point.
    But once the contract is awarded, post-award, whether it is 
a ship or a missile or anything else, oversight becomes 
critical. And so we have added--and I know you are familiar 
with this, Admiral--Supervisors of Shipbuilding, Conversion and 
Repair (SUPSHIPs), we have added some additional billets in 
cost-estimating, as well as EVM, or earned value management, of 
surveillance and oversight at those organizations.
    So it is critical for us that we do the upfront part well, 
better, and also as we get into the post-award phase that we 
really do this surveillance and the oversight part of this just 
as well.
    Mr. Sestak. Could I ask a second question? If it is 
oversight and even if it is procurement--I wasn't here for the 
previous questions, but to some degree we talk about our 
military acquisition force. Is it time to really look at 
whether the heft, the increase in this acquisition force should 
not come from the military?
    I mean, after all, we are trigger-pullers. And you take a 
commander or a lieutenant colonel and transfer him to the 
acquisition force, that is a different level of experience than 
if you took a civilian and transferred him or her to run a ship 
as a lieutenant commander or commander.
    Do you think we might be going about this the wrong way, of 
saying we need more military acquisition workforce? Because, by 
and large, they come over after not doing it very well--at all. 
Then, all of a sudden, they are an admiral and they are trying 
to run these programs.
    Maybe, could a possible better way of going about it be 
that the requirements side of the military reasserts, which 
since Goldwater-Nichols has not permitted it to do, its 
rightful oversight of the acquisition community in producing an 
effective, cost-efficient requirement? And that is where the 
military should reside as officers, not in the acquisition, if 
we change Goldwater-Nichols to merit that to happen, sir?
    Mr. Thomsen. Just a couple of comments on that.
    One of the things that we have put into place through the 
Secretary of the Navy this past year to really get at, I think, 
the heart of the question you had----
    Mr. Sestak. And that would be open to anyone to answer.
    Mr. Thomsen [continuing]. Is a governance process that 
really circles back on the issue that you asked about. And that 
really is the integration of requirements and those officers 
that are coming from the field and landing in, for example, 
Office of the Chief of Naval Operations (OpNav) and operations 
billets there in OpNav and then what we do on the acquisition 
side.
    In other words, we have worked very hard in putting 
together a governance process that brings those together at the 
beginning to make decisions that are transparent and together 
between the acquisition and requirements phase.
    With regard to growing the acquisition workforce through 
the military vice--or maybe not vice, but in addition to what 
we are doing in the civilian side----
    Mr. Sestak. But it is vice, to some degree. Every military 
guy is----
    Mr. Thomsen. It is always a tradeoff, yes, sir.
    Really, our emphasis right now is not so much that, but 
making sure that we are bringing qualified officers, 
particularly in the unrestricted line officer corps (URL), 
bringing them out earlier and getting them into the acquisition 
business earlier so that we can have the best-qualified folks 
we can get. So, in a sense, we are adding to it on the URL side 
of the House.
    As you know, the supply corps officers, Civil Engineering 
Corps (CEC) and restricted line, are pretty much growing up 
through the acquisition workforce from the beginning. A lot of 
our focus has been on how do we improve and tweak and turn the 
knobs a little bit better on bringing forward some of our 
unrestricted line officers in the acquisition corps early to 
get that experience and not wait until they are here 25, you 
know, to come into the acquisition business.
    Dr. Snyder. Mr. Wittman for five minutes.
    Mr. Wittman. Thank you, Mr. Chairman.
    I want to direct these questions to Lieutenant General 
Thompson, Mr. Thomsen, and Lieutenant General Shackelford.
    In looking at the personnel that are going to be assigned 
to the services, it appears that about half of those new 
personnel will go to the service branches. I wanted to get some 
feel about what positions will be filled within that framework, 
where you see your critical gaps as they exist today, and a 
little bit about how you determine where your greatest needs 
exist.
    And I want to try to tie all those aspects together, so if 
I could get you to give us some perspective on that.
    General Thompson. Sir, yeah, similar to the answer that I 
gave before, we did do a gap analysis, if you will, across all 
the acquisition areas. The growth area that is the most 
significant is contracting, followed by systems engineering, 
program management, and then cost-estimating. And I think we 
have the numbers about right. We did a holistic assessment, 
looking at the programs that we have to run and the types of 
service contracts that we have to let, and determined high-
grade, middle-grade, you know, interns, and new members of the 
workforce, what the right balance is.
    I think we have it about right. We will have to adjust it 
as we go, over time. I mean, the numbers for the Army are 5,435 
conversions and new members of the acquisition workforce. If we 
don't need 5,435, we won't go up to that number. It is really 
looking at what the need is and having the right mix of 
military, civilian, and some contractors that are working in 
support of the acquisition function and swinging the pendulum 
back the other way.
    Mr. Assad. Sir, if I could just make a comment for a minute 
to give you a little bit more context in terms of what we are 
doing with the workforce.
    About 70 percent of the growth in the acquisition workforce 
will be in the engineering, oversight functions. It will not be 
in the contracting or pricing. About 30 percent of our growth 
is in contracting and pricing, about 70 percent program 
management, oversight, Defense Contract Management Agency 
(DCMA), Defense Contract Audit Agency (DCAA), and engineering 
capability. Less than 10 percent, in fact probably even less 
than that, is in the military side of the street. So this is 
primarily a civilian workforce growth initiative, and so there 
will not be a significant increase in the numbers of military 
officers in the acquisition community.
    Having said that, there is no doubt that we need to have 
battlefield commanders and acquisition professionals with their 
boots on the ground who understand--for example, in Iraq and 
Afghanistan, we have well over 200,000 contractors supporting 
our force. They need to know how to manage that force. They 
need to understand how it was contracted for and how it will be 
overseen. And so, there is an inherent capability that we need 
to have within the military services, especially as it relates 
to contracting in a combat environment.
    Mr. Thomsen. Congressman, yes, sir, a few things.
    Not unlike the Army or the Air Force, we have really gone 
through, first, really, our program offices, where most of our 
management pieces of our business is done. And it revealed a 
couple of things. One, without a doubt, was really----
    Dr. Snyder. Would you pull your microphone a little closer?
    Mr. Thomsen. Yes, sir.
    It brought forward a couple of things. Really, some 
imbalances in our governmental workforce as opposed to what we 
have in contracting support services. For example, in some of 
our program offices, we had contractors serving in some of 
these billets upwards of around 60 percent. So I am pretty sure 
60 percent isn't the right number. We are trying to figure out 
what the right number is, but we have gone through that 
process.
    Secondly, and one that I know you are familiar with, for 
example, at Dahlgren, which is one of our field activities, 
they have a very mature process that they go through that is 
based entirely on the demand signal, primarily from Department 
of Navy, Navy and Marine Corps, but also some of the other 
agencies, as well--they have some work there--very mature 
process to identify what their gaps are. We feel very 
comfortable--and, by the way, they represent about two-thirds 
of our acquisition workforce, if you take Dahlgren and some of 
the other field activities.
    So, in other words, we feel pretty good about that. We are 
also applying this model to the program offices. We do think we 
have some imbalances.
    All that said, again, it is really the three areas that I 
mentioned before: system engineering to really reclaim our 
knowledge space up front; and then business and cost-estimating 
the team up in the cost trade space; and then thirdly really is 
our contracting numbers, make sure that we have the right 
number for oversight and surveillance.
    General Shackelford. Yes, sir, if I could add briefly, last 
fall, as part of our internal assessment of where we stood in 
acquisition in the Air Force, we went out to the field and 
asked them how many folks they needed to get up to what they 
considered to be a healthy level. That has resulted in 2,062 
positions, just over 1,800 of which are civilian, 291 officer 
and 11 enlisted, that we are going to flow in to our workforce 
over the next 3 years.
    There are others that are coming as part of the initiatives 
coming out of the Defense Department. They will be going, 
targeted to those product centers for execution of programs. 
And, as I mentioned, contracting, cost-estimating, and systems 
engineering are the heavy hitters.
    Mr. Wittman. Thank you, Mr. Chairman.
    Dr. Snyder. Mrs. Davis for five minutes.
    Mrs. Davis. Thank you.
    You mentioned the acquisition experience in the field and 
how important that is. I wonder if you could focus on 
Afghanistan for a second and how confident you are that we have 
the contracting and logistics expertise in Afghanistan as we 
flow in troops and personnel and, obviously, equipment.
    General Thompson. Ma'am, the general officer that is over 
there now as the head of the Joint Contracting Command for Iraq 
and Afghanistan is Brigadier General Bill Phelps; just got over 
there in February and took command. He recognizes the very 
significant challenge of trying to execute a deliberate, 
planned drawdown in Iraq consistent with the administration 
policies and a deliberate increase in our footprint in 
Afghanistan.
    He has come back to the Department, and we are working 
across the Department right now to increase the size of the 
Joint Contracting Command with both military and civilian 
members to be able to handle that balancing act over the next 
year or so. And so, we are working, based on his assessment, to 
source an increase of about 53, I think is the exact number, 
military and civilian contracting professionals to be able to 
deal with that surge into Afghanistan, also at the same time 
balancing the drawdown in Iraq.
    And so the commander on the ground that has that 
responsibility, working both for General Odierno and General 
McKiernan, the two commanders on the ground, is pretty 
confident that, if he gets that increased help, he will be able 
to balance that. And we are watching that very, very closely.
    Mrs. Davis. Is there an area particularly in addition to a 
number of the issues that you have raised in terms of the gaps 
that we--you know, three months from now when we are sitting 
here in committee, what do you think is the most likely thing 
that we might hear that is needing assistance?
    General Thompson. I don't have an answer on one area that I 
think is going to come up. I think if we do this right, we 
shouldn't have any major issues or, you know, things that hit 
the press that are not going right.
    And so, we have learned some lessons, and we have taken 
those lessons to heart on, you know, the surge into Kuwait and 
Iraq over the last seven years. And we are using all those 
lessons learned.
    You know, the things we talked about earlier today, ma'am, 
about training the non-acquisition workforce, the operational 
commanders, to understand their critical role in defining 
requirements and their critical role in helping us manage the 
delivery of those, primarily, services in the theater with not 
just the acquisition workforce and the contracting officers but 
also the contracting officer representatives, who ensure that 
the delivery of that service happens as it is contracted for.
    Mrs. Davis. Does anybody else want to comment on that?
    General Shackelford. Ma'am, if I could, the Air Force 
supports approximately 70 percent of the military contracting 
manpower positions in that joint command in Afghanistan and 
Iraq. The good news is they are doing a marvelous job, and they 
are in high demand. The bad news is, it has driven that 
community into what we call a one-to-one dwell ratio, where 
their time at home equals their time deployed, which is leading 
us towards pursuing a retention bonus for those officers. Our 
enlisted people already have a bonus to help them with the 
retention.
    But the other point there is, those are the same people 
that, at home, would be doing the work of contracting. So that 
is part of this. In terms of numbers of contracting people, we 
have a low-density, high-demand workforce, one that has skills 
that are useable on the outside. We would like to keep as many 
as we could; we would like to get more so that we can just 
robust that entire community.
    Mrs. Davis. One of the things I was pleased--and I think, 
Mr. Assad, you mentioned this--the need to bring in mentors, 
people who have had great experience in contracting 
acquisition, who have left, perhaps with the economy have an 
interest in coming back, but that they may not be available in 
the war theater in the same way that they would be in other 
communities.
    And I am just wondering, to the extent that--it seems to me 
that we get so much more work, in many ways, developing 
expertise from interns when they have support personnel around 
them who are really playing a very active role. I don't know 
what those numbers are, if they are even near what they could 
be, given the situation that we are in.
    But would you like to comment on that and whether or not we 
are actually able to get them out in the field at all?
    Mr. Assad. Well, I think, for the most part, what we are 
looking at right now as part of a lesson learned are those 
activities that presently are being done by our uniformed 
forces on the ground that could, in fact, be done in the rear 
to support the contracting that is taking place on the ground.
    And so, one of the things we are looking at is, how do we 
get more civilian participation, even if it is in the rear, to 
support the contracting that is being done on the ground? And I 
think that we are moving towards a more effective mix of--and 
the Army has especially been looking at that, in terms of its 
experience in Kuwait, of doing more contracting in the rear.
    So we are looking at that now as we go forward to ensure 
that General Shackelford is correct, which is why the Army is 
increasing its contracting capability in its uniform services, 
to, frankly, give a little relief to the Air Force as we look 
forward.
    Mrs. Davis. Thank you.
    Thank you, Mr. Chairman.
    Dr. Snyder. We are letting Mr. Sestak play catch-up here, 
so Mr. Sestak for five minutes.
    Mr. Sestak. Thank you. I have been playing catch-up my 
whole life.
    Could I follow up on that? I have to agree with you, the 
importance of the contractors out there. I think it might have 
been a GAO study, but I can't remember, that I read about a 
year ago that made a recommendation that our war colleges--and 
I can't remember if we still have junior and senior ones--that 
we might, on the longer-term sustainability of this need, much 
like we train our warriors when they go forward how to shoot a 
gun if they are going to be--or manage a company, they should 
manage contractors, should there be a course, not just at the 
Industrial War College but all of them, that helps imbue our 
officers with that kind of knowledge? Should we legislate 
something like that?
    Mr. Assad. Well, I am not sure we need to legislate it. We 
are moving in that direction. And I think, you know, in terms 
of making sure that our senior, middle, and our field-grade 
officers get more exposure to understanding what they are going 
to have to deal with in the battle space as it relates to 
contractors, how to manage that workforce.
    Mr. Sestak. So, for example, Capstone, where every new flag 
officer might have a junior----
    Mr. Assad. Yes, sir.
    Mr. Sestak. Can I ask--were you going to comment, sir?
    General Thompson. Yes, sir. The only thing I would say is 
we have looked at all of the course content in the Army, and I 
agree with Mr. Assad, I am not sure it is something we need to 
legislate. But we have put, in 18 non-acquisition courses, we 
have put course content in there to talk about the important 
role of contracting and setting requirements.
    And similar to the Navy and the Air Force, I mean, all 
three of the services have senior executive courses where the 
importance of business principles and, you know, learning how 
to operate the very large enterprises that we have----
    Mr. Sestak. Right. But the Navy does not have--and there 
are 12,000 naval personnel on the ground in Iraq on the ground, 
some of them managing contracts, oversight, has any course at 
the war college, where it is mandatory you have to have some 
experience at a junior officer level--lieutenant commander, 
commander--on this. So maybe leveling to make sure everybody is 
the same might not be a bad idea why.
    GAO, if I could ask this one question again. I am taken 
with what I think is the proper effort to give heft or to the 
ability for oversight in the acquisition community. But I am 
still taken with the process that somehow it seems as though 
you might put more people out there on the acquisition side, 
but how well they are overseen or driven by the requirements 
side has always seemed, to me, a disconnect.
    I will always remember the Chief of Naval Operations going 
to the Assistant Secretary of Acquisition of the Navy in years 
past and almost asking what they thought of some requirement.
    Does that need to change, or am I wrong on this? Have you 
looked at it? Is this your area?
    Mr. Needham. No, I have not looked at that particular 
issue, in terms of the personnel in terms of the oversight and 
the role they play.
    The one issue that we were focusing on here in this effort 
was trying to get--what is DOD measuring and looking at and 
counting? And one of the things they could not get or did not 
have was the contracting officers representative, who is often 
a technical program person, who is overseeing the contractor. 
We have no real clear picture of how many of those are, what 
their training and skills are, and so forth. That is one area 
we saw as a need.
    Mr. Sestak. All right. I can remember studies being done 
within the service, and no one ever knew how many contracts. 
And we couldn't--two years of trying to grab it in the Navy, 
and we could never get that final number of how many 
contractors we had.
    Well, thanks. I am just also taken--I think this hearing is 
great, and I think the need for more technical authorities in 
all oversight is tremendous. I just hope that eventually we 
look at the process of how the emphasis upon the civilian 
acquisition oversight in years past, Goldwater-Nichols, led to 
some of the requirements being, ``Give as it is, we got it from 
here, don't bother us again.''
    Thank you.
    Dr. Snyder. General Thompson, in your written statement, on 
your first page, you refer to the period from 2003 to 2005. You 
say, ``From 2003 to 2005, as a result of downsizing of the 
acquisition workforce in the 1990s, there were not enough 
acquisition professionals to handle all the Army's acquisition 
programs and contract missions.''
    Why did you take 2003 to 2005? Was that just because of the 
tremendous activity that was going on, due to the overseas 
operations? What was the magical about looking at that picture?
    General Thompson. Yes, sir, we picked that particular 
period because that was when the large surge of activity into 
Iraq, in particular. And, as a result of that, we ended up with 
some seams in the system, where we had a number of people that 
were investigated, in some cases prosecuted. And so we had some 
negative things happen then, you know, that primarily the 
reason was there was just not enough people to deal with the 
large surge in workload.
    Dr. Snyder. Got you.
    On page two, I need to ask a basic question here, you talk 
about, ``We must reform how and what we buy, meaning a 
fundamental overhaul of our approach to procurement, 
acquisition, and contracting.'' I think you are using those 
three terms there as terms of art. I think probably on this 
side of the table we interchange a lot of terms and probably in 
our public discussions interchange all of these terms.
    Do each of those terms have a precise meaning for you, 
``procurement,'' ``acquisition,'' and ``contracting''?
    General Thompson. I look at ``acquisition'' as the 
overarching term. And we all operate within an acquisition 
system. Contracting is a subset of the acquisition system, and 
the procurement is a subset of that. So the overarching term is 
``acquisition.''
    Dr. Snyder. Is ``acquisition.'' Good. Thank you.
    Mr. Thomsen, you had talked about this earlier, about the 
science and engineering. You say, ``We must increase our 
business skills and rebuild our science and engineering depth 
that has been significantly reduced over the last 10 to 15 
years.''
    I want you to amplify more, if you would, on the science, 
what you see as a lack of science depth within the Navy. In 
specific, what are you talking about?
    Mr. Thomsen. Yes, sir, as I mentioned before, about two-
thirds of our acquisition workforce is actually in, I will call 
it, the field. In other words, they are not here in Washington, 
D.C. They are outside the Beltway in places like Crane, 
Indiana; San Diego, California; Newport, Rhode Island; Panama 
City, Florida; et cetera--Dahlgren. Right up the road, 
actually, in Carderock, Maryland, there is a naval research 
lab--or, excuse me, David Taylor Naval Ship Research Center 
there. Naval Research Lab is right across the river; it is 
inside the Beltway.
    That is where most of our science and engineering talent 
resides. If you go back to 1990, depending on which one of 
those you pick, but in general we have reduced those 
organizations by about 40 to 45 percent. That is a lot of 
scientists and engineers that we have allowed to go out the 
door in Department of Navy. And that is very much connected to 
what I said before about our desire to want to reclaim that 
technical and cost trade space up front.
    Those are the individuals that turn in, eventually, to 
system engineers. In fact, it doesn't take them that long 
because they are actually getting their hands on some of the 
systems that we buy and that we build.
    We think it is critical that we rebuild appropriately--not 
necessarily a hiring bonanza, but a deliberate rebuilding of 
that part of our workforce in a way that is going to support 
our strategy, which, again, is focused on the system 
engineering aspects.
    In Department of Navy, we rely on those organizations to 
support not just the program offices but to also work very, 
very closely with industry. So, for example, we have a 
requirement, all of us do, to really move to ensure that we 
don't have a Lead Systems Integrator (LSI) situation in the 
future. We are not lead systems integrators. We need to be our 
own lead systems integrators prior to these large contract 
orders. Well, in order to do that, we have to have the right 
scientists and the right engineers working with industry, to be 
a peer of industry, so that when we get to the negotiating and 
contract table we are speaking the same language and we 
understand each other.
    Dr. Snyder. Mr. Needham, in your statement, on the third 
page, you cite one case study where you say, ``In our case 
study, we found that one Army component was paying between 17 
and 27 percent more, on average, for contractor personnel 
working as contract specialists than for its government 
employees, who were doing equivalent work.''
    Of course, that is contrary to probably what has been 
discussed a lot in the last decade and a half or so. That is 
one case study. Do you think that generalizes the fact that 
outsourcing a lot of that actually ends up costing us more?
    Mr. Needham. Again, there is no data on this, Mr. Chairman. 
We did that particular case study to begin to try to get a 
handle on this. We have done some work at NASA looking at the 
same question. And we have been trying to, kind of, identify 
what is the cost-beneficial ratio here. And there really is 
no--there is no information. And, in fact, it is not often 
evaluated.
    One of the issues--we surveyed 66 program offices. And I 
think, of the ones that responded, there were 13 that said they 
looked at cost. Only one considered cost as an issue when 
deciding whether or not--in terms of their contractor 
workforce, in terms of deciding the mix that you would have, 
was looking at the cost.
    And that is not often done. And it is hard to do. And the 
only place that it is ever really done is on the A-76 process, 
and that has such a tiny proportion of the procurement dollars 
that go to that, where they do an actual cost comparison 
between the civilian workforce and the contractor workforce.
    But there is very little data. I put that in the statement 
because it was work we did a year ago when we started to look 
at this whole issue. And it is an important one that you raise.
    Dr. Snyder. Mr. Wittman, anything else?
    General Thompson. Mr. Congressman, can I give you a little 
data but sort of a little philosophy there, as well?
    Dr. Snyder. Sure.
    General Thompson. If the size of the workforce is such that 
you need X number of people and it is an enduring mission, it 
is cheaper over the long run to do it with a government 
workforce member.
    We have started down the path of insourcing some of the 
things that we had contracted out, when we look at, ``It is an 
enduring mission; I need that many people to do that job.'' 
And, on average, we have saved about $50,000 per every 
conversion that we have made from a contractor doing that job 
to a member of the government workforce doing that job, you 
know, trying to look at apples-to-apples comparison on burden 
costs, you know, retirement benefits, et cetera.
    But if you are going to do it for the long haul and it is 
not just a temporary situation where I need to contract to get 
something done and then I no longer need those people, it is 
cheaper to do with the government workforce.
    Dr. Snyder. Mr. Assad, you mentioned both in your 
discussion here and your written statement about--I think it 
was in response to Mr. Wittman, about baby boomers retiring, 
about annuitants.
    Are there any specific legislative changes that are 
hampering your ability to get the annuitants that you want? Or 
do you have everything you need, as far as ability to recruit?
    Mr. Assad. Mr. Chairman, I believe, in general, we have 
what we need. Congress has given us a great deal of 
flexibility, especially recently, in terms of dealing with 
hiring our acquisition workforce. So I think we have the tools 
that we need to execute this smartly.
    Dr. Snyder. One of you mentioned conflict-of-interest 
provisions with regard to stockholdings. Was that you, Mr. 
Assad? I don't remember who it was. Oh, it was in an article, 
that is right. It was in John Young's newspaper article today, 
about the issue of, at certain levels of hiring, that 
acquisition personnel have to divest themselves of certain 
investments.
    Is that a factor in your hiring? Is that an insurmountable 
problem for some people or not?
    Mr. Assad. It depends. In general, no. But, as you get to 
more senior folks who may have been with companies for a 
significant period of time, they usually have--and, frankly, 
are older, they usually have investments. And, frankly, if they 
are going to come into the workforce, they need to divest of 
those things so that there isn't a conflict of interest.
    Dr. Snyder. Mr. Assad, are you--or any of you--are you 
aware of any specific legislative changes that you are wanting 
now? Are you more apprehensive about any legislative changes 
that may come?
    Mr. Assad. No, sir, I think we are in pretty good shape. We 
are presently working with our personnel in the human resources 
community to see if there is anything else that we might be 
able to suggest to the committee that we need. But I think, in 
general, we think we have the tools we need.
    Dr. Snyder. Mr. Wittman, anything further?
    We appreciate you being with us today. We appreciate the 
work you are doing. Please pass on to all the folks that do 
your work that I think they are the coolest dudes in the 
Western Hemisphere.
    Thank you all. We are adjourned.
    [Whereupon, at 11:40 a.m., the subcommittee was adjourned.]
      
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                            A P P E N D I X

                             April 28, 2009

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              PREPARED STATEMENTS SUBMITTED FOR THE RECORD

                             April 28, 2009

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    [GRAPHIC(S) NOT AVAILBLE IN TIFF FORMAT]
 
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              QUESTIONS SUBMITTED BY MEMBERS POST HEARING

                             April 28, 2009

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                   QUESTIONS SUBMITTED BY DR. SNYDER

    Dr. Snyder. Congress directed the Department to set a goal of 
having certain critical acquisition functions for major acquisition 
programs and major automated information systems, like program and 
deputy program managers, chief engineers, systems engineers, and cost 
estimators be government personnel. Where do we stand with respect to 
that congressional direction? What challenges are you facing? Will 
Secretary Gates' proposal to grow and restore the acquisition workforce 
address this issue? If so, in what respect? If not, how is the 
Department going to reach this goal?
    Mr. Assad. The Secretary of Defense announced plans to revitalize 
the Defense acquisition workforce by significantly increasing its 
organic size by approximately 20,000 federal employees. As part of the 
Secretary's growth strategy, a high priority is to ensure that all 
inherently governmental functions are performed by government employees 
and that a sufficient organic acquisition workforce capability is 
available to fill critical acquisition positions. The Secretary's 
growth strategy includes in-sourcing acquisition support functions. To 
further ensure a successful outcome, the Department incorporated the 
positions identified by Congress in our DOD acquisition Key Leadership 
Position construct, and added the lead contracting officer to the list. 
These Key Leadership Positions will receive increased monitoring to 
establish a pool of qualified candidates to fill these Key Leadership 
Positions. The above efforts support meeting congressional direction 
that critical acquisition functions be performed by qualified 
government personnel. DOD's progress will be reported in the Defense 
Acquisition Workforce Human Capital Report. This report will combine 
various reporting requirements as part of a consolidated report to be 
delivered in July 2009.
    Dr. Snyder. It appears that most of the FY 2008 Defense Acquisition 
Workforce Development Fund initiatives are aimed at hiring new 
personnel. Training appears to account for a much smaller amount. 
Aren't there areas of training in need of funding? One of the things 
the subcommittee has heard is that there's very little, if any, 
training or professional-level coursework for services contracting. Are 
there any efforts underway to address that?
    Mr. Assad. Top DOD acquisition training priorities include ensuring 
training capacity for the planned growth of the defense acquisition 
workforce, improving workforce certification levels, reinvigorating 
certification standards, and continuing improvements to training 
resources that support workforce performance. Training initiatives are 
being deployed by DOD Components to address leadership and other 
Component-specific skill/competency requirements. Examples of 
Component-specific initiatives include the Army Contracting Lab and 
Army Acquisition Basic Course; and the Navy Acquisition Boot Camp, Navy 
Acquisition Hot Topics Course, and various executive leadership 
training. Air Force initiatives include expansion of attendance at its 
Air Force Institute of Technology Mission Ready Contracting Officer 
Course, the Intermediate Project Management Course, Acquisition 
Leadership Challenge Program Course, and the Air Force Fundamentals of 
Acquisition Management Course.
    We agree that services contracting training needs continued 
emphasis and improvement. The Defense Acquisition University (DAU) has 
created the Learning Center of Excellence for Service Acquisition. The 
center provides a dedicated, integrating focus on developing an in-
depth body of training and learning assets to improve DOD's execution 
of service requirements. DAU has developed a classroom course, ACQ 265 
Mission Focused Services. This is an interactive, case based course 
that targets a broad range of the acquisition workforce. It focuses on 
developing performance based requirements and business strategies and 
has been available since 2007. DAU has also developed Service 
Acquisition Workshops (SAWs). The workshops provide just-in-time, 
hands-on, training early in the requirements process. The team training 
includes major stakeholders--the customer, program manager, contracting 
officer, Contracting Officers Representative (COR), and other 
personnel. The DOD Service Acquisition Mall (SAM) is another initiative 
that provides on-line access to best-in-class practices for acquiring 
services. SAM will be organized by standard Federal Product Service 
Codes and contain training material and tools for developing 
performance based service requirements. Initial operational capability 
for SAM is planned for the end of September 2009.
    Other examples of new acquisition-related training include expanded 
expeditionary training, Contracting Officer Representative training, 
and requirements training for the ``Big A'' workforce. This also 
includes improved and expanded training for contract specialists and 
pricing personnel; international cooperation training; expanded program 
management training; source selection and risk management training 
improvements; new curricula development for high impact, emerging 
acquisition needs; and other job enhancing learning assets. DOD will 
also complete an enterprise-wide competency assessment of the 
acquisition workforce to identify gaps and improve both training and 
human capital planning.
    The above initiatives reflect DOD's commitment and action to ensure 
increased training capacity and to create a comprehensive learning 
environment that has the right learning assets available at the 
employee's learning point-of-need. The Defense Acquisition Workforce 
Development Fund, made possible by the Congress, is enabling DOD to 
significantly improve acquisition training capability, to include in 
the area of services contracting.
    Dr. Snyder. Last year's authorization legislation required the 
establishment of a career path for military personnel that assures that 
we attract highly talented individuals who will have opportunity for 
promotion and advancement. We also required that general and flag 
officer billets be reserved for the acquisition career path and that 
there are adequate numbers of military personnel active in acquisition 
to ensure proper functioning and to make sure we have the military 
personnel we need to conduct contingency contracting. Can you comment 
on how your Service will meet these requirements? How many of the 
general/flag officer acquisition billets are for contracting positions?
    General Thompson. The Army has a robust process that attracts and 
accesses highly talented military personnel into the Army Acquisition 
Corps. This past year we established an earlier accession point for 
military acquisition officers and NCOs to enable them to begin their 
acquisition careers up to two to three years earlier. This provides for 
increased availability of Army acquisition personnel and more time to 
develop and apply their expertise. We have also issued career guidance 
to restrict military contracting professionals from serving in theater 
until they have a minimum of one year of contracting experience within 
the United States.
    In addition, the established career paths for military acquisition 
professionals in the Army Acquisition Corps ensure that the highest 
caliber officers and NCOs enter, develop, and remain in the right 
positions in the acquisition workforce. The career path includes a 
robust command opportunity for acquisition and contracting officers (to 
include GO opportunities) and the development of qualified contingency 
contracting personnel. Army officers and NCOs currently receive 
training, experience, and acquisition certification in five Acquisition 
Career Fields (ACFs): Program Management; Contracting; Systems, 
Planning, Research, Development and Engineering-Systems Engineering; 
Information Technology; and Test & Evaluation. As mission and career 
development needs dictate, officers are assigned to the five career 
fields at the Field Grade ranks, and NCOs belong to the 51C 
(Contracting) ACF.
    Army Section 852 funding initiatives also assist us in attracting 
and recruiting new acquisition personnel. This includes offering 
Student Loan Repayment opportunities and Special Duty Assignment Pay 
for NCOs.
    Section 503(a) of the National Defense Authorization Act (NDAA) for 
Fiscal Year 2009 (FY09) authorized five additional General Officer 
billets in the Active Component with the requirement that they have 
significant contracting experience. As of April 2009, the Army selected 
one additional acquisition General Officer (GO) and will select more 
this year until the five billets are filled. The GO selected is a 
Brigadier General who is the Commander of the recently established 
Expeditionary Contracting Command. The Army had already established the 
two-star U.S. Army Contracting Command as part of AMC and the one-star 
Mission & Installation Contracting Command--both billets are presently 
filled by experienced members of the Senior Executive Service until new 
GOs are selected. The two remaining billets are the Military Deputy for 
Contracting in the U.S. Army Corps of Engineers (USACE) and an 
acquisition (contracting) GO in the Office of the Assistant Secretary 
of the Army for Acquisition, Logistics and Technology (ASAALT) in the 
Office of the Deputy Assistant Secretary for Procurement (DASA(P)).
    Dr. Snyder. Last year's authorization legislation required the 
establishment of a career path for military personnel that assures that 
we attract highly talented individuals who will have opportunity for 
promotion and advancement. We also required that general and flag 
officer billets be reserved for the acquisition career path and that 
there are adequate numbers of military personnel active in acquisition 
to ensure proper functioning and to make sure we have the military 
personnel we need to conduct contingency contracting. Can you comment 
on how your Service will meet these requirements? How many of the 
general/flag officer acquisition billets are for contracting positions?
    Mr. Thomsen. The Department of the Navy actively manages our 
military workforce career path requirements. Over the past two years, 
we have revised some military community career paths to meet 
anticipated shortfalls in the pipeline for experienced acquisition 
professionals in order to fill our most critical acquisition positions, 
including Program Managers, Program Executive Officers, and contracting 
officers. The Department's military acquisition leadership is most 
effective when staffed with a carefully calibrated mix of warfare 
communities including Marine Corps operational and Navy Unrestricted 
Line Officers (Aviation, Surface and Submarine communities), Restricted 
Line Officers (Engineering Duty Officers, Aerospace Engineering Duty 
Officers, Aerospace Maintenance Duty officers) , and Staff Corps 
(Supply Corps and Civil Engineering Corps). Due to the demands on 
operational forces, we have faced challenges providing our officers 
with needed acquisition experience early in their career pipelines. As 
a result, the Naval Aviation community has proposed a refinement to 
their acquisition professional career path which will provide Aviators 
with hands-on acquisition experience years earlier in their careers. 
The Surface Warfare Officer community initiated similar changes to 
their career path structure to ensure earlier acquisition experience.
    The Department's Restricted Line and Supply Corps communities have 
been effective in ensuring a robust acquisition career path that yields 
highly experienced and qualified Acquisition Professionals. The Marine 
Corps established a Military Occupational Specialty for Acquisition 
Management Professionals. Officers in this specialty are typically 
assigned to critical acquisition positions that provide senior 
leadership for ground equipment and/or weapons systems programs. This 
prepares them for future program management and executive officer 
assignments.
    At the end of Fiscal Year 2008, Department of the Navy had a total 
of 72 Flag Officer/General Officer acquisition billets, with 40 Flag or 
General Officers filling those billets. Of those 40 Flag and General 
Officers, five were in contracting. The number of Flag Officer/General 
Officer billets allows for flexibility in assigning of Flag Officers 
and General Officers in areas of greatest need.
    At the end of Fiscal Year 2008, the Department of the Navy had 
approximately 1,200 military officer contracting billets. Navy 
construction contracting capability resides in the Civil Engineer 
Corps. Navy logistics material and major weapons systems acquisition 
contingency contracting capability resides in the Supply Corps.
    Within the Marine Corps, contracting is a separate specialty that 
contains 30 officers and 120 enlisted billets aligned to the 
operational forces to support the Marine Corps' contingency operations. 
Marine Corps Officers earn the contracting specialty as secondary 
specialty with a primary specialty in a related field, such as 
logistics, supply or financial management, and become contracting 
officers after completing acquisition training. The majority of the 
contracting officers within the Marine Corps are highly experienced 
civilians throughout the supporting establishment and at Marine Corps 
Systems Command.
    Dr. Snyder. Can you please describe how your Service is conducting 
its inventory of services contacts? The Army seems to be the farthest 
along in this effort. Are you using the Army's work as a model? If not, 
why wouldn't that make sense?
    Mr. Thomsen. In accordance with the phased implementation schedule 
detailed in the May 16, 2008 Deputy Under Secretary of Defense for 
Acquisition and Technology memo regarding NDAA FY08 Section 807, the 
Department of the Navy (DON) is developing, and will deliver, a 
prototype inventory list for review and approval in FY09.
    In response to Section 807, the DON has developed a methodology to 
compile the FY 08 inventory of services contracts. The DON methodology 
uses existing data repositories and databases (the Standard Procurement 
System and the Federal Procurement Data System--Next Generation) to 
electronically capture discretely identified contracts and related data 
elements, specifically those required under Section 807. This captured 
data is used to electronically generate the required Section 807 data 
reports.
    One of the contract data categories required under Section 807, the 
number of full-time contractor employees or equivalents (FTE) on each 
service contract, is not directly captured by the DON data systems. DON 
has developed, and received Defense Procurement and Acquisition 
Policy's approval for, a statistical sampling approach to report the 
number of FTEs in the inventory. From a statistically-significant 
sample, DON calculates an average FTE figure from weighted average 
labor rates and using a defined algorithm then calculates the number of 
FTEs on each services contract.
    DON's review of the Army's Contractor Manpower Reporting System 
revealed that the systems used by DON (referenced above) would be 
incompatible with the Army-designed system due to different internal 
data base structures required by DON to meet the scheduled reporting 
requirements of Section 807.
    Dr. Snyder. Last year's authorization legislation required the 
establishment of a career path for military personnel that assures that 
we attract highly talented individuals who will have opportunity for 
promotion and advancement. We also required that general and flag 
officer billets be reserved for the acquisition career path and that 
there are adequate numbers of military personnel active in acquisition 
to ensure proper functioning and to make sure we have the military 
personnel we need to conduct contingency contracting. Can you comment 
on how your Service will meet these requirements? How many of the 
general/flag officer acquisition billets are for contracting positions?
    General Shackelford. The Air Force deliberately develops 
acquisition professionals according to well defined career path models 
which serve as a guide for developing both military officers and 
civilians through assignments, education, and training. These career 
models define career paths to greater rank and responsibility within 
the acquisition workforce. The development of acquisition workforce 
members is enhanced by the use of Career Field Development Teams 
consisting of senior leadership from within each Career Field. Using 
the published acquisition career path models as a guide, the 
Acquisition Development Teams provide individuals developmental 
guidance ``vectoring'' them on paths of progression and opportunity in 
the acquisition workforce. The Development Teams also nominate officers 
and civilians for service schools (developmental education), and 
identify military candidates for command leadership positions within 
the acquisition workforce. The Air Force has also established career 
field management and force development functional responsibility at the 
Headquarters Air Staff level to provide strategic direction to the 
career fields, and oversight of the Developmental Team process.
    The Air Force relies on a large pool of military contracting 
officers in order to meet Air Force and a fair share of joint, 
contingency contracting deployments. Today the Air Force maintains the 
Department of Defense's largest deployable contracting force and is 
filling the bulk of the contingency contracting and contract 
administration deployment requirements in Iraq and Afghanistan. The 
current operations tempo generated by the wars in Iraq and Afghanistan 
has made the contracting career field one of the most deployed career 
fields in the Air Force. Air Force leadership recognizes the threat the 
current ops tempo poses to the retention of the contracting force and 
has initiated numerous efforts to ensure the workforce remains the 
backbone of the contingency contracting mission. One of the recent 
efforts is to evaluate the need for a Critical Skills Retention Bonus 
for contracting officers in targeted year groups and grades. This 
effort has been underway for some time and, pending OSD and corporate 
Air Force approval, is targeted to formally roll out in the 2009 fiscal 
year.
    The Air Force acquisition workforce also has a contingent of 
enlisted personnel within the contracting career field. These Airmen 
serve in key positions throughout the Air Force in the operational and 
contingency contracting communities and are also developed in concert 
with the needs of the Air Force. The development of this invaluable 
resource is addressed both within the enlisted force and within the 
contracting community to ensure the right quality and numbers of 
contracting NCOs are retained for the Air Force contracting mission.
    The Air Force codes and tracks all General Officer billets in the 
acquisition workforce for use in development and succession planning, 
and to ensure the best qualified leaders are identified to fill these 
key leadership positions. The Air Force currently has 22 General 
Officer acquisition billets, and 27 acquisition-qualified General 
Officers including 1 contracting-qualified General Officer. The Air 
Force currently has no General Officer contracting positions. The 6 
senior Contracting positions in the Air Force are Senior Executive 
Service (SES) positions. The Air Force's most senior leadership 
continually reviews General Officer requirements against General 
Officer authorizations to ensure the number of General Officer billets 
in acquisition continue to be properly balanced with total Air Force 
requirements.
    Dr. Snyder. Can you please describe how your Service is conducting 
its inventory of services contracts? The Army seems to be the farthest 
along in this effort. Are you using the Army's work as a model? If not, 
why wouldn't that make sense?
    General Shackelford. To fulfill the Section 807 reporting 
requirements for June 09, the Air Force has pulled contract-specific 
data from the Contracting Business Intelligence Service (CBIS) system 
supplemented by a manual data call and mathematical calculation for 
other required elements. The Army's Section 807 submittal was based on 
data from their Contractor Management Reporting System, a data system 
which the Army began implementing several years ago. The Air Force has 
had no equivalent system capturing the number of full-time contractor 
equivalents because of our use of performance-based service contracting 
as required by the Office of Federal Procurement Policy, whereby the 
focus is on outcomes not on the number of contractor personnel required 
to achieve the outcome. It is our understanding that Defense 
Procurement and Acquisition Policy (DPAP) is looking at a possible 
department-wide solution for the future, leveraging the lessons learned 
from the contractor reporting requirements of the 2009 American 
Reinvestment & Recovery Act.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. FRANKS
    Mr. Franks. Mr. Assad, in your best estimation, with the increase 
of 20,000 personnel through the year 2015, taking into consideration 
training, experience, and the graduated departure of our existing 
workforce, what would you project as a ``get well'' date where we start 
to see the benefits of this plus-up initiative?
    Mr. Assad. As has been stated by the Secretary of Defense, there is 
no silver bullet. However, we are already seeing the benefits as a 
result of improved and expanded training investments made in Defense 
Acquisition University. Hiring has started, morale is up, and we are 
getting great feedback from the defense acquisition community. We have 
added resources to the Defense Contract Audit Agency (DCAA) and they 
have hired over 100 people. DCAA is already seeing benefits of added 
audit capacity which is providing additional data for our senior 
acquisition leaders. As for a specific get well date relative to 
improved acquisition outcomes, the results will not change overnight. 
However, we believe the strategy is right and the successful employment 
of these workforce initiatives is a leading indicator for improving 
acquisition outcomes.
    Mr. Franks. Mr. Assad, with the plan to significantly increase the 
size of the acquisition workforce, it has been said that with a large 
shortfall that already exists within the DOD coupled with stiff 
competition from the private sector that the Defense Department might 
find it difficult to attract the best and brightest to their ranks. Do 
you agree with this statement? What plans does the department have to 
recruit and retain quality acquisition professionals?
    Mr. Assad. No. I do not agree. I believe the Department of Defense 
is well positioned to attract high quality candidates to become members 
of the defense acquisition workforce. The Administration's leadership, 
the top-down driven strategy of the Secretary of Defense, and the 
strong support of Congress are enabling the most significant increase 
in growth of the defense acquisition workforce ever undertaken. The 
challenges we have are internal and related to administrative processes 
associated with establishing positions and the length of time to hire 
and to get onboard new personnel. We are actively working through 
initiatives to resolve these issues. The support we have received from 
Congress (e.g., Expedited Hiring Authority) have been very beneficial. 
We are encouraged and believe we will solve these issues.
    The Department is implementing a robust employee retention and 
talent management strategy to retain acquisition workforce employees 
with expert knowledge in critical and shortage skill areas. These 
employees include individuals filling Key Leadership Positions (KLPs) 
such as program managers, engineers, senior contracting officers, life 
cycle logisticians, cost estimators, etc. (especially those in ACAT I 
and ACAT II programs) and other personnel possessing special expertise 
that is hard to find or retain. We are confident that we will be 
successful.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MS. SANCHEZ
    Ms. Sanchez. I have received a number of reports stating that 
contracts are awarded to contractors and subcontractors whose products 
do not meet the original performance specification. How could a 
production contract award be made based on a product that did not meet 
the original performance specification? Is there a set process, and if 
so, what is the process contractors/subcontractors have to go through 
in order to ensure that their products are meeting the performance 
specifications indicated by the Department? How is the Department 
ensuring that performance specification testing is rigorous enough so 
that our service members are not exposed to defective products?
    General Thompson. Contracts should not be awarded to contractors 
and subcontractors whose products do not meet the original performance 
specification. If the contractor has not met the original performance 
specification then the contract should be terminated.
    Delineated in the Federal Acquisition Regulation (FAR) Subpart 9.2, 
is a set process that ensures contractor/subcontractor products meet 
Department of the Army performance specifications. The formal and 
structured process includes the testing and examination of products for 
compliance with contract requirements. Upon completion of the 
Government's evaluation and subsequent determination that the products 
meet the qualification requirements, the agency places that product on 
an approved list. Only contractors with products on the approval list 
may compete for contract award. Since this process is more restrictive, 
in the interest of promoting full and open competition, it is used only 
when necessary and only after the head of the agency, or his designee, 
prepares a written justification. For those products whose 
qualification requirements do not fall under this Subpart, the 
contracting officer relies upon the requiring activity technical expert 
to ensure that the performance specifications meet the government's 
needs.
    The Department, through its contracting function, specifies 
contract quality requirements based on product complexity and 
criticality. We vigorously audit conformance to contract quality 
requirements. Contract quality requirements include product attributes 
at the component and end-item levels, as well as those (contractor) 
management controls necessary to assure quality. These controls apply 
to all work affecting quality such as ordering of materials, 
fabrication, assembly, inspection and testing (in-process and final), 
and delivery. Additionally, all acquisition programs require a Test and 
Evaluation Master Plan, which describes what testing is required, who 
will perform the testing, what resources will be needed, and what the 
requirements are for evaluation. The Commanding General, U.S. Army Test 
and Evaluation Command is responsible for assessing program 
effectiveness, suitability, and survivability (or progress towards 
achieving these) during each phase in the life-cycle. Assessments or 
evaluations, conducted by the system evaluator (including the safety 
confirmation), will support materiel release actions for new 
procurement, reprocurements, and system changes.
    Ms. Sanchez. Currently, the Lead System Integrators (LSIs) and 
Prime Contractor oversight is limited because of the downsizing of the 
DOD acquisition workforce. What progress has DOD made in rebuilding its 
acquisition workforce, and how will this impact LSIs? What are the 
impediments for DOD in this regard?
    General Thompson. The Army is making significant progress in 
identifying acquisition workforce requirements that will be increased 
through many avenues. We are actively recruiting new employees, in-
sourcing contractor positions to civilians, and are working with the 
personnel community to identify new opportunities to pilot to 
streamline the hiring process. In-sourcing is being identified as a 
result of an Army-wide review of contractor support positions. This 
review will provide the analytical underpinnings to ensure the Army has 
a proactive, executable strategy for in-sourcing. Due to restrictions 
on the use of LSIs, the Program Manager, Future Combat Systems will 
continue to transition the System of Systems engineering and 
integration tasks to the government with the assistance of a prime 
contractor in FY10. Given the time required to acquire the skills and 
conduct additional formal and experiential training to make these 
personnel effective, the transition is not expected to be complete 
until 2013.
    There are challenges in moving forward. The process to grow the 
acquisition workforce will require formulation of concept plans, with 
subsequent review and approval of the spaces and the funding. There are 
also limitations in available skilled personnel, since a fair amount of 
program experience is required to prepare a systems engineer, for 
example. On the job practical experience is required to truly be 
qualified. Given the limited number of true developmental programs 
currently in the Army, the number of individuals getting opportunities 
for this experiential piece is limited. The Army will expand the 
developmental opportunities as we grow the acquisition workforce.
    Ms. Sanchez. I have received a number of reports stating that 
contracts are awarded to contractors and subcontractors whose products 
do not meet the original performance specification. How could a 
production contract award be made based on a product that did not meet 
the original performance specification? Is there a set process, and if 
so, what is the process contractors/subcontractors have to go through 
in order to ensure that their products are meeting the performance 
specifications indicated by the Department? How is the Department 
ensuring that performance specification testing is rigorous enough so 
that our service members are not exposed to defective products?
    Mr. Thomsen. Contract awards made upon a competitive source 
selection will meet the RFP performance specification. Proposals that 
are assessed as not meeting the requirements of the RFP are considered 
deficient and are deemed unawardable. However, during the performance 
of the awarded contract, particularly development contracts, changes to 
the specification may result due to technical, schedule, cost and or 
budgetary issues. These issues are not unusual for major weapons 
systems contracts. Even within this environment, contractors are not 
allowed to deviate from any Critical Performance Parameters called out 
in the specification. Contractors may only propose to deviate from 
lesser parameters which do not affect usability or safety. These 
deviations must be identified and justified. Consequently, due to the 
trade-off analysis employed during development, the follow-on 
production contract's performance specification may be somewhat 
different from what was originally envisioned when the development 
contract was awarded.
    Production contracts normally include a requirement for the 
contractor to submit a production test plan and test procedures for 
Government approval. This serves as the basis for the contractor to 
demonstrate compliance with the contract's specification requirements, 
which is required before Government acceptance and/or payment.
    The Department ensures performance testing is sufficiently rigorous 
by first requiring a program manager to have an over-arching Test & 
Evaluation Master Plan (TEMP) approved by the Milestone Decision 
Authority (MDA) prior to obtaining approval to start production. 
Secondly, requirements specified in the Capability Production Document 
(CPD) set the acceptable thresholds and desired objectives used in the 
TEMP for performance measures to be demonstrated during developmental 
and operational testing. Programs must complete a series of 
development-level testing; achieve Government-required Technology 
Readiness Levels; conduct technical specifications demonstrations; and 
perform operational assessment for programs on the OSD OT&E oversight 
list. The foregoing results and satisfactory program health at 
Milestone C inform the MDA's decision to proceed with Low-Rate Initial 
Production (LRIP) articles to support Initial Operational Test and 
Evaluation (IOT&E). The MDA's subsequent Full-Rate Production Decision 
Review (FRPDR) requires the Government Independent Operational Test 
Agency to report on Operational Effectiveness and Suitability. Finally, 
each production contract requires every item offered for delivery to be 
subjected to various tests, witnessed by the Government, to ensure 
contract performance specification compliance, prior to Government 
acceptance.