Defense Acquisition
DOD Should Clarify Requirements for Assessing and Documenting Technical-Data Needs Gao ID: GAO-11-469 May 11, 2011Some of the Department of Defense's (DOD) weapon systems remain in the inventory for decades. Therefore, decisions that program officials make during the acquisition process to acquire or not acquire rights to technical data, which may cost $1 billion, can have far-reaching implications for DOD's ability to sustain and competitively procure parts and services for those systems. DOD needs access to technical data to control costs, maintain flexibility in acquisition and sustainment, and maintain and operate systems. In response to a congressional request, GAO reviewed the extent to which: (1) DOD has updated its acquisition and procurement policies to reflect a 2007 law and 2006 GAO recommendations; (2) selected acquisition programs adhered to requirements to document technical-data needs; and (3) DOD took actions to improve technical-data decisions by program managers. GAO interviewed DOD officials, reviewed acquisition strategies and acquisition plans from 12 programs, and compared those documents to relevant DOD policies.
DOD updated its acquisition and procurement policies to require that acquisition program managers document their long-term technical-data needs in a manner that reflects a 2007 law and GAO's 2006 recommendations. Together these policies require documentation of: (1) an assessment of technical-data requirements, (2) the merits of a "priced-contract option" that enables DOD to obtain additional technical data that it did not acquire in its initial contract, (3) the contractor's responsibility to verify its assertions of limits to DOD's ability to use the technical data, and (4) the potential for changes in the system's sustainment plan. According to DOD officials, these policy updates do not require changes to the way program managers assess technical-data needs. Sampled acquisition programs partially addressed the four updated technical-data-documentation requirements. Ten of the 12 programs GAO reviewed addressed at least 1 of the 4 requirements in their acquisition strategies and acquisition plans; however, none of the programs addressed all 4 of the requirements. Specifically, 9 of the 12 strategies documented an assessment of their technical-data requirements. For example, the strategy for a Navy communications system stated that the program planned to obtain technical data and associated rights to sustain the system over its life cycle and allow for competitive procurement of future systems. In contrast, 3 of the 12 strategies documented the contractor's responsibility to verify its assertions of limits to DOD's ability to use the technical data. Each of the three strategies noted that the program planned to include a clause in its contracts that identifies the contractor's responsibilities. DOD has issued guides--that are voluntary for the program managers to use--to improve technical-data decision-making. These guides may help program managers with decisions and documentation on technical data. However, DOD technical-data policies remain unclear. Effective internal controls help organizations implement their directives. GAO found that, because DOD has not issued clarifications to its policy, DOD policies that require documentation of long-term technical-data needs are unclear. As a result, acquisition strategies have not always documented required information on technical data--a point the Office of the Under Secretary of Defense for Acquisition, Technology and Logistics recently emphasized. Because of the ambiguity in the policies, DOD's ability to implement effective internal control over those policies is limited. Moreover, DOD recently added a requirement that program managers conduct a business-case analysis for systems' long-term technical-data needs. However, DOD has not issued policy or other internal controls that describe how to conduct this analysis. GAO has previously reported that the military services inconsistently completed similar business-case analyses because DOD had not issued instructions on how to conduct them. Without instructions that describe how to conduct the business-case analysis, senior acquisition decision makers may not receive the information they need to decide whether to approve programs at major milestones in the acquisition process. GAO recommends that DOD (1) update policies to clarify its technical-data documentation requirements and (2) instruct program managers on the elements to include and the information to report for technical-data business-case analyses. DOD concurred with GAO's recommendations.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Jack E. Edwards Team: Government Accountability Office: Defense Capabilities and Management Phone: (202) 512-8246GAO-11-469, Defense Acquisition: DOD Should Clarify Requirements for Assessing and Documenting Technical-Data Needs
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United States Government Accountability Office:
GAO:
Report to the Subcommittee on Oversight and Investigations, Committee
on Armed Services, House of Representatives:
May 2011:
Defense Acquisition:
DOD Should Clarify Requirements for Assessing and Documenting
Technical-Data Needs:
GAO-11-469:
GAO Highlights:
Highlights of GAO-11-469, a report to the Subcommittee on Oversight
and Investigations, Committee on Armed Services, House of
Representatives.
Why GAO Did This Study:
Some of the Department of Defense‘s (DOD) weapon systems remain in the
inventory for decades. Therefore, decisions that program officials
make during the acquisition process to acquire or not acquire rights
to technical data, which may cost $1 billion, can have far-reaching
implications for DOD‘s ability to sustain and competitively procure
parts and services for those systems. DOD needs access to technical
data to control costs, maintain flexibility in acquisition and
sustainment, and maintain and operate systems. In response to a
congressional request, GAO reviewed the extent to which: (1) DOD has
updated its acquisition and procurement policies to reflect a 2007 law
and 2006 GAO recommendations; (2) selected acquisition programs
adhered to requirements to document technical-data needs; and (3) DOD
took actions to improve technical-data decisions by program managers.
GAO interviewed DOD officials, reviewed acquisition strategies and
acquisition plans from 12 programs, and compared those documents to
relevant DOD policies.
What GAO Found:
DOD updated its acquisition and procurement policies to require that
acquisition program managers document their long-term technical-data
needs in a manner that reflects a 2007 law and GAO‘s 2006
recommendations. Together these policies require documentation of: (1)
an assessment of technical-data requirements, (2) the merits of a ’
priced-contract option“ that enables DOD to obtain additional
technical data that it did not acquire in its initial contract, (3)
the contractor‘s responsibility to verify its assertions of limits to
DOD‘s ability to use the technical data, and (4) the potential for
changes in the system‘s sustainment plan. According to DOD officials,
these policy updates do not require changes to the way program
managers assess technical-data needs.
Sampled acquisition programs partially addressed the four updated
technical-data-documentation requirements. Ten of the 12 programs GAO
reviewed addressed at least 1 of the 4 requirements in their
acquisition strategies and acquisition plans; however, none of the
programs addressed all 4 of the requirements. Specifically, 9 of the
12 strategies documented an assessment of their technical-data
requirements. For example, the strategy for a Navy communications
system stated that the program planned to obtain technical data and
associated rights to sustain the system over its life cycle and allow
for competitive procurement of future systems. In contrast, 3 of the
12 strategies documented the contractor‘s responsibility to verify its
assertions of limits to DOD‘s ability to use the technical data. Each
of the three strategies noted that the program planned to include a
clause in its contracts that identifies the contractor‘s
responsibilities.
DOD has issued guides-”that are voluntary for the program managers to
use-”to improve technical-data decision-making. These guides may help
program managers with decisions and documentation on technical data.
However, DOD technical-data policies remain unclear. Effective
internal controls help organizations implement their directives. GAO
found that, because DOD has not issued clarifications to its policy,
DOD policies that require documentation of long-term technical-data
needs are unclear. As a result, acquisition strategies have not always
documented required information on technical data”a point the Office
of the Under Secretary of Defense for Acquisition, Technology and
Logistics recently emphasized. Because of the ambiguity in the
policies, DOD‘s ability to implement effective internal control over
those policies is limited. Moreover, DOD recently added a requirement
that program managers conduct a business-case analysis for systems‘
long-term technical-data needs. However, DOD has not issued policy or
other internal controls that describe how to conduct this analysis.
GAO has previously reported that the military services inconsistently
completed similar business-case analyses because DOD had not issued
instructions on how to conduct them. Without instructions that
describe how to conduct the business-case analysis, senior acquisition
decision makers may not receive the information they need to decide
whether to approve programs at major milestones in the acquisition
process.
What GAO Recommends:
GAO recommends that DOD (1) update policies to clarify its technical-
data documentation requirements and (2) instruct program managers on
the elements to include and the information to report for technical-
data business-case analyses. DOD concurred with GAO‘s recommendations.
View [hyperlink, http://www.gao.gov/products/GAO-11-469] or key
components. For more information, contact Jack E. Edwards at (202) 512-
8246 or edwardsj@gao.gov.
[End of section]
Contents:
Letter:
Background:
DOD Created Requirements to Document Long-Term Technical-Data Needs:
Selected Programs Partially Addressed the Updated Requirements to
Document Long-Term Technical-Data Needs:
DOD Issued Guides to Improve Technical-Data Decision Making, but
Technical-Data Policy Requirements Remain Unclear:
Conclusions:
Recommendations for Executive Action:
Agency Comments:
Appendix I: Scope and Methodology:
Appendix II: DOD's Implementation of Technical-Data Requirements Cited
in Recent Legislation and DOD Audit Agencies' Report Recommendations:
Appendix III: Comments from the Department of Defense:
Appendix IV: GAO Contact and Staff Acknowledgments:
Related GAO Products:
Tables:
Table 1: Organizations Interviewed to Obtain Information Related to
Technical Data for this Report:
Table 2: Technical Data-Related Requirements from the Duncan Hunter
National Defense Authorization Act for Fiscal Year 2009 and DOD's
Responses as of March 2011:
Table 3: Army and Air Force Audit Agencies' Recommendations in
Technical-Data-Related Reports and the Military Departments' Responses
as of March 2011:
Figures:
Figure 1: The Four Phases of the Technical-Data Acquisition Process:
Figure 2: Results of GAO's Evaluations of Selected Acquisition
Programs' Documentation of Technical-Data Assessments:
Abbreviations:
ACAT: Acquisition Category:
DFARS: Defense Federal Acquisition Regulation Supplement:
DOD: Department of Defense:
OSD: Office of the Secretary of Defense:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
May 11, 2011:
The Honorable Rob Wittman:
Chairman:
The Honorable Jim Cooper:
Ranking Member:
Subcommittee on Oversight and Investigations:
Committee on Armed Services:
House of Representatives:
The Department of Defense (DOD) needs access to technical data related
to its weapon systems in order to control costs and maintain
flexibility in the acquisition and sustainment of those weapon
systems. Technical data--recorded information used to produce,
support, maintain, or operate a system[Footnote 1]--can enable the
government to complete maintenance work in house, as well as to
competitively award contracts for the acquisition and sustainment of a
weapon system. Because many systems remain in DOD's inventory for
decades, decisions that officials make during the acquisition process
to acquire or not acquire rights to technical data can have far-
reaching implications for DOD's ability to sustain the systems and
competitively procure parts and services. Weapon systems are costly to
sustain in part because they often incorporate technologically complex
subsystems and components and need expensive spare parts and logistics
support to meet required readiness levels. According to DOD, at least
70 percent of a weapon system's life-cycle costs are incurred to
operate and support a weapon system after it has been acquired, with
the percentage depending on how long a system remains in the inventory.
Since 2002, we have issued several reports that address technical
data.[Footnote 2] For example, we reported in 2006 that a number of
fielded Army and Air Force systems encountered limitations in
sustainment options because the military services lacked needed
technical-data rights. In the 2006 report, we recommended that DOD
require program managers to assess long-term technical-data needs and
establish corresponding acquisition strategies that provide for the
technical-data rights needed to sustain weapon systems over their life
cycles. More recently, we reported in 2010 that the government's lack
of access to proprietary technical data, among other things, limits--
or even precludes the possibility of--competition for DOD weapons
programs.
Congress has also highlighted the importance of technical data in the
defense acquisition process. For example, section 802 of the National
Defense Authorization Act for Fiscal Year 2007 includes a requirement
that the Secretary of Defense direct program managers for major weapon
systems to assess their systems' long-term technical-data needs.
[Footnote 3] The act also requires that the Secretary direct program
managers to develop corresponding acquisition strategies that provide
for the technical-data needs to sustain their systems throughout their
life cycle. Similarly, Congress passed the Weapon System Acquisition
Reform Act of 2009, which required in part that the Secretary of
Defense is to ensure the acquisition strategy for each major defense-
acquisition program includes measures to ensure competition, or the
option of competition, in contracts for the program throughout its
life cycle.[Footnote 4] The act cited the acquisition of complete
technical-data packages as one option for promoting competition.
In response to your request, this report addresses the extent to which
(1) DOD has updated its acquisition and procurement policies to
reflect certain technical-data-related provisions of the 2007 National
Defense Authorization Act and GAO's 2006 recommendations aimed at
assessments of long-term technical-data needs;[Footnote 5] (2)
selected defense acquisition programs have adhered to the updated
requirements in DOD policy to document their systems' long-term
technical-data needs; and (3) DOD has taken actions to improve
decision making by program managers on the long-term technical-data
needs for systems in its acquisition process.[Footnote 6]
To evaluate the extent to which DOD updated its acquisition and
procurement policies to reflect certain technical-data-related
provisions of the 2007 National Defense Authorization Act and GAO's
2006 recommendations, we analyzed the act and our prior
recommendations. We identified and evaluated changes the department
made to its acquisition and procurement policies since the 2007 act.
We used information from our evaluation of these policies in the
analyses we conducted for each of our objectives. We also reviewed
follow-up records maintained by DOD and GAO that document actions the
department had taken in response to audit recommendations. To evaluate
the extent to which selected defense-acquisition programs have adhered
to the requirements in DOD policy to document their system's long-term
technical-data needs, we selected a non-generalizable sample of 12
programs out of about 50 programs subject to the requirements outlined
in DOD acquisition and procurement policies. Our sample included Army,
Navy[Footnote 7], and Air Force programs in the two highest-value
acquisition categories[Footnote 8] that reached major milestones
[Footnote 9] in the defense acquisition process from September 2007 to
August 2010. In addition, findings from our sample are not
generalizable to all DOD acquisition programs, although the variety of
circumstances that the programs in our sample face illustrates
important aspects of documenting a system's long-term technical-data
needs. We obtained key acquisition documents--the acquisition strategy
and acquisition plan--from the programs in our sample that reflect the
technical-data needs of the system. Two team members concurrently
conducted independent analyses of the same acquisition documents for
each program comparing the documents against relevant criteria from
DOD pol[Footnote 10]icy. We then compared the two sets of observations
and reconciled any differences with the assistance of a third analyst,
when necessary. We provided our preliminary observations of the
documents to officials in each program and considered additional
information they provided when our observations indicated that the
program documents had not addressed one or more of the requirements.
To evaluate the extent to which DOD has taken actions to improve
technical-data decision making, we reviewed documentation including
the November 2010 Under Secretary of Defense for Acquisition,
Technology and Logistics memorandum, Implementation Directive for
Better Buying Power-Obtaining Greater Efficiency and Productivity in
Defense Spending, as well as guidelines on technical data that the
Office of the Under Secretary of Defense for Acquisition, Technology
and Logistics, which is part of the Office of the Secretary of Defense
(OSD), and each of the military departments recently issued. For each
of our objectives, we also interviewed officials in a variety of
relevant organizations including the OSD, the acquisition headquarters
office in each of the military departments, and the 12 acquisition
programs in our sample. During these interviews, we obtained
perspectives from officials and documentation such as acquisition
strategies and acquisition plans from each of the programs in our
sample. We also assessed the reliability of all of the data that we
discuss in this report by reviewing relevant documentation and
interviewing knowledgeable officials. We found the data sufficiently
reliable for the purposes of this report.
We conducted this performance audit from May 2010 to May 2011 in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives. We discuss our
scope and methodology in more detail in appendix I.
Background:
DOD program managers obtain technical data and technical-data rights
to enable the department to acquire and sustain weapon systems at the
lowest cost, to provide flexibility in future acquisition and
sustainment of systems and subsystems, and to maintain those systems.
DOD may obtain different levels of rights to technical data including
unlimited rights, government-purpose rights, and limited rights. If
DOD obtains unlimited rights to technical data, it may provide the
data to anyone for any reason. However, if DOD obtains government-
purpose rights, it may provide the data to third-party contractors
only for activities in which the U.S. government is a party, including
competitive reprocurement, but not including commercial purposes.
Further, if DOD obtains limited rights, it may only use the data
internally and may provide the data to third parties in a limited
number of circumstances (e.g., emergency repair and overhaul.)
Moreover, DOD and contractor maintenance personnel need technical data
and technical-data rights in order to maintain, repair, and upgrade
weapon systems throughout the life cycle of the systems.
The Process to Acquire Technical Data:
The process that DOD program officials follow to acquire technical
data and technical-data rights for systems includes four general
phases with multiple steps in each phase. In this report, we evaluated
aspects of the first phase of this process (see figure 1).
Figure 1: The Four Phases of the Technical-Data Acquisition Process:
[Refer to PDF for image: illustration]
Requirements, Strategies, and Plans:
Program officials determine the long-term technical data and
associated rights needs for their systems and document those needs in
the program's acquisition strategy and acquisition plan.
Contracting:
Program officials specify technical data requirements in solicitations
issued to contractors. Contractors‘ proposals assert any restrictions
on DOD‘s rights to technical data needed to produce a system. Program
officials review and evaluate proposals, identify areas of
disagreement, and may challenge contractors‘ assertions.
Performance and Delivery:
When contractors produce the system, they may assert some additional
restrictions to technical data rights, which DOD may challenge.
Contractors mark all data they deliver to DOD with the appropriate
level of rights, and DOD reviews and evaluates these marks for
consistency with DOD policies and agreements in the contract.
Post-Performance and Sustainment:
DOD may realize if it has acquired the needed data and rights when it
sustains its systems. DOD uses data and rights to maintain, repair,
and solicit for sustainment contracts for its systems. DOD may
challenge data rights markings within 3 years of contract completion.
DOD may also exercise options for additional rights and data that it
did not initially acquire if this option is provided for in the
contract.
Source: GAO analysis of DOD documentation.
Note: Although this process we illustrate in this figure focuses on
technical data and technical-data rights, DOD officials stated that
they also use most of the same process to acquire computer software
and computer software documentation with some exceptions.
[End of figure]
* Requirements, strategies, and plans phase: Program officials assess
the long-term technical data and technical-data rights requirements
for their system and then document those requirements in an
acquisition strategy and an acquisition plan for their system. To
assess a system's technical-data requirements, program officials
determine which components DOD will need technical data for and the
level of rights to seek for those data.[Footnote 11] Program officials
consider several factors in their assessment, such as the government's
cost for the rights to the data, sustainment plans, re-procurement
needs, and contractors' economic interest. Once program officials
complete their assessment, they record the technical-data requirements
in a data-management strategy that is included in the acquisition
strategy, a document that is required by DOD Instruction 5000.02. They
also include similar documentation in the acquisition plan, which is
required by the DFARS. The acquisition strategy describes the overall
approach for managing and planning for the program, while the
acquisition plan describes the program's contracting approach.
[Footnote 12] The program manager then submits these documents to
senior department officials to review and approve at certain major
milestones in the defense acquisition process.
* Contracting phase: Program officials specify the approved technical-
data requirements in solicitations they issue to contractors. These
solicitations describe the capability requirements for a system that
the government intends to acquire. Contractors then submit proposals
to DOD in which they describe the system that they would build to
provide the required capability. In the proposals, contractors also
discuss technical-data issues. For example, if a contractor desires to
assert restrictions on DOD's ability to use any of the technical data
needed to manufacture or sustain the system, the contractor asserts
those restrictions in its proposal. Program officials then review and
evaluate the contractors' proposals using criteria included in the
solicitation. Officials evaluate any asserted restrictions on DOD's
use of technical data to identify areas of disagreement that the
department should resolve through negotiations or other procedures in
accordance with applicable law.[Footnote 13] DOD officials then award
a contract.
* Performance and delivery phase: During this phase, the selected
contractor begins producing the system and may assert additional
restrictions to technical-data rights in certain circumstances. For
example, the contractor may assert new restrictions if the department
modifies its system requirements or if the contractor inadvertently
omitted a restriction during the contracting phase. DOD officials may
also challenge these additional asserted restrictions. Contractors
mark all technical data they deliver to the government with a level of
rights (e.g., government purpose or limited rights). In addition,
program officials review these markings to ensure that the contractor
has identified them in a manner that is consistent with DOD policies
and the agreement in the contract.
* Post-performance and sustainment phase: In this phase, the
contractor has delivered a system to DOD. DOD officials may realize
during post-performance and sustainment whether they have acquired the
necessary technical data and technical-data rights during the
sustainment phase. When sustaining systems, DOD personnel may use
technical data for critical functions including maintaining and
repairing systems. Any new technical data and technical-data rights
that would be needed for any support contracts during sustainment
phase would need to be acquired. Program officials also may challenge
the level of rights that the contractor asserted for any delivered
technical data that is used to produce the system for up to 3 years
after final payment under the contract or three years after delivery
of the data, whichever is later.[Footnote 14] Program officials may
also exercise options to obtain additional rights and data that the
department did not acquire during the performance and delivery phase
if DOD and the contractor had included a provision in the contract
called a "priced-contract option."
Prior GAO and Defense Audit Agencies' Work on Technical Data:
For nearly a decade, we and the military-service audit agencies have
conducted reviews that included information on DOD's acquisition of
technical data and technical-data rights for systems in the
acquisition process. In February 2002, we reported that DOD officials
expressed concern that they did not have affordable technical data to
develop additional or new sources of repair and maintenance to ensure
a competitive market.[Footnote 15] Subsequently, we reported in August
2004 that DOD program managers often opt to spend limited acquisition
dollars on increased weapon system capability rather than on acquiring
the rights to the technical data--thus limiting their flexibility to
perform maintenance work in house or to support alternate source
development should contractual arrangements fail.[Footnote 16] We
subsequently reported in July 2006 that the Army and the Air Force
encountered limitations in their sustainment options for some fielded-
weapon systems because they lacked technical-data rights.[Footnote 17]
More recently, we reported in 2010 that the government's lack of
access to proprietary technical data, among other things, limits--or
even precludes the possibility of--competition for DOD weapons
programs.[Footnote 18]
Additionally, the Air Force and Army audit agencies have reported on
issues related to the acquisition of technical data and technical-data
rights. For example, in May 2009, the Air Force Audit Agency reported
that Air Force program officials had not effectively implemented OSD
and Air Force initiatives to improve the management and acquisition of
technical-data rights and had not satisfied technical-data assessment
requirements.[Footnote 19] Similarly, the Army Audit Agency reported
in July 2009 that (1) Army policies on technical-data assessments and
documentation were not incorporated into Army regulations and (2) the
Army acquisition workforce had not received training on assessing and
managing technical data and technical-data rights requirements and as
a result did not consistently address technical data and technical-
data rights requirements.[Footnote 20] We provide more detail in
appendix II about the recommendations in these audit agency reports
and the services' responses.
DOD Created Requirements to Document Long-Term Technical-Data Needs:
DOD updated its acquisition and procurement policies, in a manner that
reflects a 2007 legislative provision and our 2006 recommendations, to
require that acquisition program managers document their long-term
technical-data needs. According to DOD officials, these policy updates
do not change the requirements program managers must follow that to
decide what technical data or technical-data rights to acquire for
their systems.
Section 802 of the 2007 National Defense Authorization Act required
the Secretary of Defense to direct program managers for major weapon
systems--and subsystems of major weapon systems--to assess the long-
term technical-data needs of their systems and establish strategies
providing for the technical-data rights needed to sustain the systems
over their life cycles. The 2007 act required, among other things,
that the strategies developed in accordance with the section address:
* the merits of a priced contract option for the future delivery of
technical data that were not acquired upon initial contract award, and:
* the potential for changes in the sustainment plan over the life
cycle of the system.
We had previously recommended that DOD establish these requirements
for program managers in our July 2006 report.[Footnote 21] We
recommended these actions after finding that a lack of technical-data
rights limited the flexibilities of the Army and Air Force to make
changes to sustainment plans for some fielded weapon systems. We also
found that delaying action in acquiring technical-data rights can make
these data cost-prohibitive or difficult to obtain later in a weapon
system's life cycle.
DOD took a series of actions to change its acquisition and procurement
policies in a manner that reflects the language of the 2007 act and
our 2006 recommendations. As a result of these actions, program
managers are now required to record their long-term technical-data
needs in two key acquisition program documents: the acquisition
strategy and acquisition plan. Initially, OSD issued a memorandum in
July 2007 requiring program managers for systems in the two highest-
value acquisition categories (ACAT I and II) to assess the long-term
technical-data needs for their systems and document a corresponding
strategy for technical data in each program's acquisition strategy.
[Footnote 22] DOD later included this policy change in the December
2008 update of its acquisition policy, DOD Instruction 5000.02. In a
separate action, DOD issued an interim rule in September 2007 amending
the DFARS. This rule also requires program managers to assess the long-
term technical-data needs for their systems and document a
corresponding strategy in each program's acquisition plan. DOD
finalized the interim rule in December 2009. [Footnote 23] Together
these policy changes required that strategies and plans for major
acquisition programs:[Footnote 24]
1. assess the data required to design, manufacture, and sustain the
system as well as to support re-competition for production,
sustainment, or upgrade;
2. address the merits of including a priced contract option for future
delivery of data not initially acquired;
3. consider the contractor's responsibility to verify any assertion of
restricted use and release of data; and:
4. address the potential for changes in the sustainment plan over the
life cycle of the weapon system or subsystem.
OSD officials told us that these policy updates do not change the
requirements program managers must follow to decide what technical
data or technical-data rights to acquire for their systems. They also
told us that the only new requirement was that program managers
include documentation of their system's long-term technical-data needs
in acquisition strategies and acquisition plans. Moreover, OSD and
each military department have issued guides for program managers that
elaborate on the requirements in DOD policy assessing long-term
technical-data needs and the updated requirement to document those
needs in acquisition strategies and acquisition plans. We discuss
these guides in more detail later in this report.
Selected Programs Partially Addressed the Updated Requirements to
Document Long-Term Technical-Data Needs:
The documentation we reviewed for 12 acquisition programs partially
addressed the revised DOD policies on long-term technical-data needs.
We evaluated these programs' acquisition strategies and acquisition
plans against four criteria identified in the revised technical-data
policies (described earlier in more detail). These policies require
programs to document (1) an assessment of technical-data requirements,
(2) the merits of a priced-contract option, (3) the contractor's
responsibility to verify assertions of limited data rights, and (4)
the potential for changes in the system's sustainment plan. We
examined program acquisition strategies for the first three
requirements. We reviewed program acquisition plans for the fourth
requirement because the requirement was not included in the revised
acquisition policy that governs acquisition strategies but was
included in the procurement-policy update, which governs acquisition
plans.
As a part of our review, we did not consider the amount or level of
quality of the information that the acquisition strategies and
acquisition plans included in response to each requirement because
DOD's policies did not specify the minimum levels or types of
information that program officials are required to include to satisfy
each of the four requirements. Programs in our sample included varying
amounts of information in response to each requirement they addressed.
For example, one acquisition strategy contained a 95-page appendix on
technical-data management while another contained three paragraphs
focusing on technical data. If a strategy or plan included any
discussion of a requirement, we determined that the strategy or plan
addressed that requirement, regardless of the level of detail.
Figure 2 summarizes the results of our analysis and shows that 10 of
the 12 programs that we evaluated addressed at least one of the 4
requirements in their documentation, and 4 addressed as many as 3
requirements. However, none of the programs addressed all four of the
requirements in its documentation, and two did not address any of the
requirements.
Figure 2: Results of GAO's Evaluations of Selected Acquisition
Programs' Documentation of Technical-Data Assessments:
[Refer to PDF for image: illustrated table]
Air Force:
Program (acquisition category, milestone): Small Diameter Bomb II (I,
B): A bomb that enables multiple fighter aircraft, such as the F-35,
to attack mobile targets in adverse weather;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Addressed.
Program (acquisition category, milestone): C-130 Avionics
Modernization Program (I, C): An upgrade that replaces and enhances
multiple aviation electronics systems, including communication,
navigation, and surveillance, for the intra-theater airlift aircraft;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Addressed;
Sustainment potential for changes: Not addressed.
Program (acquisition category, milestone): F-16 Operational Flight
Program M6/M6+ (II, B): An upgrade that replaces and enhances multiple
aviation electronics systems ” including communication, navigation,
and surveillance ” for the intra-theater airlift aircraft;
Assessment of technical data requirements: Not addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Not addressed.
Program (acquisition category, milestone): B-1 Bomber Radar
Reliability and Maintainability Improvement Program (II, C): A
replacement of the transmitter and signal processor within the long-
range bomber‘s radar system and supporting software conversion;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Not addressed.
Army:
Program (acquisition category, milestone): Guided Multiple Launch
Rocket System Alternative Warhead (I, A): A replacement warhead used
on multiple Army rockets that is designed to reduce the risk of
unexploded ordnance;
Assessment of technical data requirements: Not addressed;
Merits of a priced contract option: Addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Not addressed.
Program (acquisition category, milestone): Integrated Air and Missile
Defense (I, B): An air-and missile-defense system with a central
network and modular components;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Addressed;
Sustainment potential for changes: Addressed.
Program (acquisition category, milestone): Extended Range Multi-
Purpose Unmanned Aircraft System (I, C): An armed, unmanned aircraft
with associated ground-based equipment for missions including
reconnaissance, surveillance, and target acquisition;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Addressed;
Sustainment potential for changes: Addressed.
Program (acquisition category, milestone): Joint Battle Command-
Platform (II, B): An upgrade to a combat command and control system
consisting of software and some associated hardware components;
Assessment of technical data requirements: Not addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: N/A[B].
Navy:
Program (acquisition category, milestone): Joint High Speed Vessel (I,
B): A high-speed, shallow-draft vessel for rapid intra-theater
transport of personnel and cargo;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Addressed.
Program (acquisition category, milestone): Navy Multiband Terminal (I,
C): A maritime military satellite terminal designed to enhance secure
communications;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: N/A[B].
Program (acquisition category, milestone): Surface Electronic Warfare
Improvement Program Block II (II, B): An upgrade to the surface
electronic warfare capability for ships‘ combat systems to provide
improved anti-ship missile defense and situational awareness;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Not addressed.
Program (acquisition category, milestone): E-6B Take Charge and Move
Out Block I Modification (II, C): An upgrade that replaces
communications, avionics, and command and control systems in the
airborne strategic command aircraft;
Assessment of technical data requirements: Addressed;
Merits of a priced contract option: Not addressed;
Contractor‘s responsibility to verify data assertions[A]: Not
addressed;
Sustainment potential for changes: Not addressed.
Source: GAO analysis of DOD policy and program documentation.
[A] Although three programs documented their consideration of the
contractor's responsibility to verify assertions of restricted use and
release of technical data, a number of programs included information
addressing the program office's efforts or responsibility to verify
contractor's assertions of restricted use and release of technical
data.
[B] These two programs were not yet subject to the requirement because
they had not updated their acquisition plans subsequent to the policy
change.
[End of figure]
Assessments of technical-data requirements: Nine of the 12 acquisition
strategies documented an assessment of the data required to design,
manufacture, and sustain the system as well as support re-competition
for production, sustainment, or upgrade of the system, for example:
* The Integrated Air and Missile Defense strategy included an appendix
that, among other things, stated that the program office would require
delivery of sufficient data to completely describe and define the
functional and physical characteristics of the system for
manufacturing, and it also provided a list of required types of data.
* The strategy for the Navy Multiband Terminal stated that the program
manager had "assessed the long-term technical-data needs" of the
system and "established acquisition strategies that provide for
technical data" and "associated license rights needed to sustain [the
systems] over their life cycle and allow for competitive procurement
of future terminals."
* The three strategies that did not address the requirement did not
identify any required data.
Merits of a priced-contract option: Four of the 12 acquisition
strategies discussed the merits of a priced contract option--an option
to obtain additional data and rights that the program did not acquire
during the contracting phase, for example:
* The Small Diameter Bomb II strategy stated that the contract "will
contain a priced contract option—for a one-time delivery of a
technical-data package" that would consist of data "that describes the
design, support, test, and maintenance" of the system, and the models,
simulation and analysis used to predict its performance.
* The strategy for the Joint High Speed Vessel stated that due to "the
non-developmental nature of the program, a priced [contract] option—
was not considered a cost-effective use of government funds."
* The eight other strategies did not discuss the merits of a priced
contract option for technical data.
Contractor's responsibility to verify data assertions: Three of the 12
acquisition strategies referred to the contractor's responsibility to
verify any assertion that the contractor made to restrict the
government's use and release of any technical data. Each of the three
strategies noted that the program planned to include a clause in its
contracts that identifies the contractor's responsibility to provide
sufficient information to the government's contracting officers to
enable them to evaluate the contractor's assertions. While nine
strategies did not discuss the contractor's responsibility to verify
assertions of restricted use and release of technical data or mention
the contract clause, a number of these strategies discussed the
program office's efforts or responsibility to verify contractor
assertions of restricted use and release of data. For example, the B-1
Bomber Radar Reliability and Maintainability strategy discussed the
program office's efforts to verify the contractor's assertion of
restricted use and release of data.
Potential for sustainment changes: Four acquisition plans addressed
the potential for changes in the system's sustainment plan over its
life cycle, and the acquisition plans for two other programs were not
subject to this requirement, for example:
* The Joint High Speed Vessel acquisition plan stated that the
"potential for changes in the sustainment plan is small."
* Two of the 12 programs in our sample were not subject to this
requirement. The requirement did not apply to the Joint Battle Command-
Platform and Navy Multiband Terminal because both programs developed
acquisition plans prior to the September 2007 procurement policy
change on technical data and neither was required to update its plan.
Addressing the potential for changes in the system's sustainment plan
over its life cycle is required for acquisition plans developed or
updated after DOD's 2007 revision to its procurement policy. [Footnote
25]
* The six acquisition plans that did not address this requirement did
not discuss the potential for future changes in the sustainment plan
as they relate to technical-data needs.
Later in the report, we note that (1) a cause for the partially
addressed documentation is ambiguity in DOD's revised policies and (2)
this ambiguity results in limits to department decision makers'
ability to exercise effective internal control in their reviews of
acquisition documentation, which may result in delays in the
acquisition process. Because these issues are related to a similar
ambiguity in another technical-data policy, we provide a more detailed
discussion of the causes and effects for both types of problematic
outcomes later in this report. In the next section of our report, we
describe OSD and military department guides that discuss additional
voluntary steps the program managers may take for conducting and
documenting assessments of long-term technical-data needs. These
guides may result in acquisition documentation that is more responsive
to DOD's revised policies. However, most of the guides we describe
were issued after most of the acquisition documentation we reviewed
was approved.
DOD Issued Guides to Improve Technical-Data Decision Making, but
Technical-Data Policy Requirements Remain Unclear:
DOD and Military Departments Issued Guides to Improve Program
Managers' Technical-Data-Related Decisions:
OSD and each military department have issued several guides for
program managers that elaborate on the requirements in DOD policy for
conducting and documenting assessments of long-term technical-data
needs. From December 2009 through December 2010, DOD and the military
departments issued guides covering voluntary actions that program
managers might take to improve their decisions related to technical
data. While officials in DOD and the military departments told us that
program officials have found the various DOD-wide and military
department-specific guides useful, program managers are not required
to follow any of the recommendations contained in the guides.
In December 2009, OSD updated the Web-based Defense Acquisition
Guidebook to elaborate on the new requirements for program managers to
document the long-term technical-data needs for their systems. The DOD-
wide guidebook now includes topics that OSD recommends that program
managers discuss in their acquisition strategy documenting the
system's long-term technical-data needs. For example, the guidebook
recommends that for data acquired to support competition, the program
manager document the (1) logic applied to select the technical data
and technical-data rights, (2) alternative solutions considered, and
(3) criteria used to decide what, if any, data to procure.
Subsequent to the changes in the DOD-wide guidebook, the military
departments provided their own additional guides. The Air Force
Program Management and Acquisition Excellence Office in December 2010
issued an update to a guide for program managers that includes
recommended steps to follow when determining a system's long-term
technical-data needs and documenting those needs in a data-management
strategy.[Footnote 26] For example, the guide suggests that program
managers consider whether Air Force depot officials agree that the
technical data and technical-data rights that the program intends to
acquire for the system are sufficient to enable depot-level
maintenance. Later, in October 2010, the Air Force's Product Data
Acquisition Team launched a technical-data-focused Web site that
includes some of the same information contained in the earlier Air
Force guide and additional information. For example, the Web site asks
program managers if the technical-data rights that program managers
intend to acquire enable the Air Force to support competition for
contracts for spare parts, equipment to upgrade to a system, and
logistics support.[Footnote 27]
The Army's Product Data and Engineering Working Group in August 2010
published a 68-page guide that describes steps it recommends program
officials take to assess a system's long-term technical-data needs and
document those needs in a data-management strategy.[Footnote 28] The
Army's guide contains a work sheet that provides program managers with
a systematic approach to assess their technical-data needs. For
example, for each component of a system, the worksheet prompts program
managers to consider the (1) level of rights required, (2) expected
levels of rights the Army will acquire in negotiations with a
manufacturer, (3) any gaps between the requirements and expected
negotiated outcomes, (4) plans to close any gaps, and (5) risks
associated with those plans.
The Navy in June 2010 published a set of guidelines that it recommends
program managers follow when they determine their systems' technical-
data rights. The Naval Open Architecture Enterprise Team included
these guidelines in an appendix to a contracting guidebook.[Footnote
29] Like the Air Force and Army resources, the appendix lists
questions that the team recommends program managers consider when
conducting a technical-data rights assessment. For example, the
appendix asks whether the government will obtain government-purpose
rights at a minimum for a system and asks for a justification for
agreeing to more restrictive rights than government purpose rights.
In addition to these department-level guides, some subordinate
commands within military departments have issued guidance on technical-
data assessments. For example, Air Force Materiel Command issued a
handbook on technical-data rights in May 2010, while the Air Force's
Space and Missile Systems Center issued the third edition of a similar
guide in January 2011. By issuing their own guidance, these
subordinate commands are able to focus on issues of technical data
particular to the command in question.
Required Policies on Technical-Data Assessments Remain Unclear:
While OSD and each of the military departments took actions to help
program managers prepare technical-data assessments, DOD has not
clarified ambiguities in the required technical-data policies to
ensure their full implementation. Specifically, DOD has not clarified
how program offices should address the requirement for documenting
technical-data assessments, and has not clarified a recent requirement
to conduct a business-case analysis on technical-data needs. Without
internal controls such as clear instructions on how to respond to
these policies, DOD and the military departments risk incomplete and
inconsistent actions and documentation in response to the technical-
data requirements. According to standards for internal control,
[Footnote 30] implementing effective internal controls is a key factor
that helps organizations ensure that management's directives are
carried out. Examples of internal control actions that management can
take include issuing policies or instructions that enforce
management's directives.
Revised Technical-Data Policy Requirements Are Unclear:
We found that the revisions to DOD's acquisition and procurement
policies, which require acquisition program managers to document their
long-term technical-data needs, are unclear. For example, the revised
DOD Instruction 5000.02 requires program managers to document an
assessment of long-term technical-data requirements for their systems.
However, the policy does not clearly state the level of detail program
managers are required to document, or the extent to which they should
document their reasoning for acquiring or not acquiring technical data
and technical-data rights. Likewise, the DFARS requires programs to
address in program documentation the potential for changes in the
sustainment plan over the system's life.[Footnote 31] However, the
policy does not make clear what information DOD expects to be provided
in documentation of possible future changes to a system's sustainment
plan (for example, underlying assumptions), and how this information
should relate to the technical-data discussion. Our previously
discussed evaluation of 12 acquisition strategies and plans--most of
which were approved before OSD and the military departments issued
their voluntary guides--showed that program managers may not fully
understand how to respond to these revised policies. As we noted, we
found that eight of the 12 acquisition strategies and plans we
reviewed addressed no more than two of the four requirements (see fig.
2).
OSD had not issued an update to the DOD Instruction 5000.02 or the
DFARS as of April 2011 to clarify what programs specifically need to
do to address the assessments of technical data. OSD officials
acknowledged to us that the policies could be rewritten for greater
clarity, and they pointed out ambiguities in some of the requirements.
For example, they told us that the assessment of technical-data
requirement is unclear. The officials told us that if they had the
opportunity, they would clarify the requirement to state that program
managers (1) assess the data that are needed to re-compete for
production, sustainment, or upgrade, and (2) determine what, if any,
of that technical data the program requires.
Ambiguity in the revised policies results in limits to department
decision makers' ability to exercise effective internal control in
their reviews of acquisition documentation. Without clear policies on
documenting long-term technical-data needs, program managers may not
understand how to respond and, as a result, may continue to submit
incomplete acquisition documentation. Without complete documentation,
senior level department decision makers are limited in their ability
to carry out their internal control responsibilities to ensure that
programs are aligned with department policies and priorities. An
August 2010 memorandum from the Office of the Under Secretary of
Defense for Acquisition, Technology and Logistics called attention to
this limitation stating that recent acquisition strategies often did
not include sufficient detail on topics including technical-data
requirements. The memorandum stated that future acquisition strategies
submitted that did not provide all of the required information would
be delayed. Delays in the acquisition process can, in turn, hinder
DOD's ability to provide needed materiel to the warfighter.
OSD Requires a Business-Case Analysis for Technical-Data Decisions,
but Has Not Issued Instructions on How to Conduct the Analysis:
OSD recently added a requirement that program managers conduct a
business-case analysis as part of their assessment to determine the
long-term technical-data needs for their systems; however, DOD has not
issued policy or other internal controls that describe how to conduct
this analysis. In November 2010, the Under Secretary of Defense for
Acquisition, Technology and Logistics issued a memorandum that
requires program officials to take a number of actions to improve
efficiency and productivity in defense spending.[Footnote 32] Among
other things, the memorandum requires program managers for all
acquisition programs to (1) conduct a business-case analysis[Footnote
33] that outlines the technical-data rights the government will pursue
to ensure competition and (2) include the results of this analysis in
acquisition strategies at Milestone B.[Footnote 34]
According to OSD officials, a business-case analysis would require
program managers to determine whether the benefits of acquiring
technical data are worth the costs of acquiring them. Prior to this
memorandum, a formal cost benefit analysis was not required for
technical-data decisions. As of January 2011, DOD officials told us
that no acquisition program had yet completed this analysis because no
program had reached Milestone B since the Under Secretary issued the
memorandum. Therefore, we could not evaluate an analysis conducted in
response to this new requirement.
Since establishing the requirement in its November 2010 memorandum,
OSD had not issued policy or other internal controls, as of April
2011, that describe how to conduct the business-case analysis or what
information to report in the acquisition strategy.[Footnote 35] The
Under Secretary of Defense for Acquisition, Technology and Logistics
stated in the memorandum that the department would take additional
actions in support of the memorandum. However, OSD officials told us
that they have not decided whether to issue additional clarifying
policy to instruct program managers on how to conduct the analysis or
what information about the results of the analysis they should include
in acquisition strategies.
Previous GAO Review Found Business-Case Analyses Were Inconsistently
Completed:
We have previously reported that the military services inconsistently
completed similar business-case analyses when DOD had not issued
instructions on how to conduct them.[Footnote 36] In 2008, we found
that DOD had not issued a policy instructing program managers on the
elements to include in the documentation of the analyses that program
managers conducted for decisions on performance based logistics
arrangements--a DOD approach to providing support to weapon systems.
[Footnote 37] As a result, program staff conducted business-case
analyses that were inconsistent and missing one or more elements
recommended by a DOD instruction on economic analyses. We found that
DOD officials implemented the performance based logistics arrangements
for the sample of programs we reviewed without the benefit of sound
and consistent analyses. Among other things, we recommended that DOD
clearly define specific criteria for these analyses in DOD policy. DOD
partially agreed with our recommendation. To address our
recommendation, in April 2011, the Principal Deputy Assistant
Secretary of Defense for Logistics and Materiel Readiness issued the
Product Support Business-Case Analysis Guidebook.[Footnote 38]
Because OSD has not issued policy instructing program managers on how
to conduct and document the analyses, program managers may conduct
incomplete or inconsistent analyses and report inconsistently on
important elements of the analyses and findings. Similar to the
situations we described in our 2008 report, program managers may not
include key required elements of business-case analyses, such as
assumptions, feasible alternatives, and costs and benefits that
support their technical-data decisions. In addition, because OSD has
not issued policy instructing program managers on how to report on the
results of these analyses, program managers may not provide the
information that senior leaders in DOD and the military departments
need in order to decide whether to approve the acquisition programs at
major milestones in the acquisition process. Technical-data decisions
can be costly, with some prime contractors quoting a price in excess
of $1 billion for technical-data packages. Thus, decision makers need
sufficient details to conduct their reviews and make fully informed
decisions. The November 2010 memorandum demonstrates that this
negative effect already exists for technical-data-related requirements.
Conclusions:
DOD has taken meaningful actions that could lead to an increased focus
on technical data in defense acquisition--actions that may help DOD
improve effectiveness and cost efficiency when acquiring and
sustaining its weapon systems. DOD has reflected congressionally
mandated and GAO-recommended changes in updated policies to emphasize
the importance of discussing and documenting assessments of technical
data and data rights in acquisition documentation, but program
officials could benefit from additional clarifications to these
policies. If DOD does not clarify the level and type of detail
required in these updated policies, program managers may continue to
inconsistently include the needed information. Furthermore, senior
department officials may delay approving these acquisition strategies
at major milestone reviews. Delays at major acquisition milestones
could postpone the department's effort to provide needed materiel to
the warfighter.
Moreover, DOD has required that program managers conduct a business-
case analysis to weigh the costs of access to technical data for DOD's
systems against the benefits of acquiring these data. This recently
required step may add rigor to decisions to acquire technical data
that program managers make early in the process. However, in the
absence of DOD-wide instructions to program managers on how to conduct
these analyses, program officials may conduct analyses that exclude
key elements and therefore do not support optimal decision making for
rights to technical data that can cost $1 billion or more. Delaying
issuing implementing instructions to program managers for the business-
case analysis could slow DOD's and the military departments' efforts
to answer the Under Secretary of Defense's call to take a more
aggressive approach to finding efficiencies and reducing DOD's
spending where possible in order to better afford its future weapon
systems.
Recommendations for Executive Action:
To establish effective internal controls over technical-data policies
that improve DOD's ability to efficiently and cost-effectively acquire
and sustain weapon systems over their life cycles, we recommend that
the Secretary of Defense direct the Under Secretary of Defense for
Acquisition, Technology and Logistics to take the following two
actions:
* Issue updates to the acquisition and procurement policies that
clarify requirements for documenting long-term technical-data
requirements in program acquisition strategies and acquisition plans.
Among other things, DOD should clarify the level and type of detail
required for acquiring technical data and technical-data rights that
should be included in acquisition strategies and acquisition plans:
* Issue instructions for program managers to use when conducting
business-case analyses that are part of the process for determining
the levels and types of technical data and technical-data rights
needed to sustain DOD's systems. The instructions should identify the
elements to be included in the analyses and the types of information
to be documented in reports on the analyses.
Agency Comments:
In written comments on a draft of this report, DOD concurred with our
two recommendations. The department's written comments are reprinted
in their entirety in appendix III. DOD also provided technical
comments that we have incorporated into this report where applicable.
In response to our recommendation that DOD issue updates to the
acquisition and procurement policies that clarify requirements for
documenting long-term technical-data needs in program acquisition
strategies and acquisition plans, DOD stated that it planned to issue
a clarification this calendar year.
In response to our recommendation that DOD issue instructions for
program managers to use when conducting business-case analyses for
technical-data decisions, the department stated that it planned to
issue guidance this year related to this recommendation.
As we agreed with your office, unless you publicly announce its
contents earlier, we plan no further distribution of the report until
30 days from the report's date. At that time, we will send copies of
this report to the Secretary of Defense; the Secretaries of the Army,
the Navy, and the Air Force; and the Under Secretary of Defense for
Acquisition, Technology and Logistics. In addition, the report will be
available at no charge on the GAO Web site at [hyperlink,
http://www.gao.gov].
If you or your staff have any questions concerning this report, please
call me at (202) 512-8246 or edwardsj@gao.gov. Contact points for our
Offices of Congressional Relations and Public Affairs may be found on
the last page of this report. Key contributors to this report are
listed in appendix IV.
Signed by:
Jack E. Edwards:
Director:
Defense Capabilities and Management:
[End of section]
Appendix I: Scope and Methodology:
To evaluate the extent to which the Department of Defense (DOD)
updated its acquisition and procurement policies to reflect certain
technical-data-related provisions of the National Defense
Authorization Act for Fiscal Year 2007 and GAO's 2006 recommendations,
we reviewed the law, our recommendations, and a variety of documents
related to the context of the act and recommendations. We reviewed DOD
and military department regulations governing technical-data
acquisition and technical-data-related reports issued by GAO and DOD.
We compared changes that the department made to its acquisition and
procurement policies to respond to the law and our recommendations.
Specifically, we analyzed the following policies: (1) a memorandum
issued by the Office of the Under Secretary of Defense for
Acquisition, Technology and Logistics (OSD), Data Management and
Technical Data Rights (July 19, 2007); (2) DOD Instruction 5000.02,
Operation of the Defense Acquisition System enclosure 12(9) (Dec. 8,
2008); and (3) the Defense Federal Acquisition Regulation Supplement
(DFARS) 207.106 (S-70). We also used information from this evaluation
of the policies and their requirements in the analyses we conducted
for our other objectives. To obtain DOD's perspective on changes to
these policies as well as information for all three of our objectives,
we interviewed officials in a variety of organizations including OSD,
acquisition headquarters for each military department, selected
program executive offices, and the acquisition programs in our sample.
Table 1 lists the organizations we contacted to conduct interviews and
obtain documents related to the acquisition of technical data. We also
reviewed information in databases in the DOD Office of the Inspector
General and GAO that record actions DOD took to implement our
recommendations. To evaluate actions DOD and the military departments
took to implement additional legislative provisions and audit
recommendations related to technical data (that we describe in app.
II), we evaluated the requirements in the relevant legislation or the
actions called for in the relevant recommendations. We then obtained
and analyzed key documentation, such as updates DOD made to the DFARS
to implement section 202 of the Weapon Systems Acquisition Reform Act
of 2009.
Table 1: Organizations Interviewed to Obtain Information Related to
Technical Data for this Report:
Office of the Secretary of Defense:
* Office of the Under Secretary of Defense for Acquisition, Technology
and Logistics:
* Office of the Assistant Deputy Under Secretary of Defense for
Materiel Readiness:
* Office of Defense Procurement and Acquisition Policy:
* Office of the Director, Acquisition Resources and Analysis:
* Defense Acquisition University:
* Office of the General Counsel:
* Office of the Inspector General:
Air Force:
* Directorate for Acquisition Integration, Assistant Secretary of the
Air Force for Acquisition;
* Acquisition Excellence & Change Management Office, Deputy Assistant
Secretary for Acquisition Integration;
* Division of Acquisition Law, Assistant Secretary of the Air Force
for General Counsel;
* Directorate for Transformation, Office of the Deputy Chief of Staff
for Logistics, Installations, and Mission Support;
* Directorate for Maintenance, Office of the Deputy Chief of Staff for
Logistics, Installations, and Mission Support;
* Aeronautical Systems Center, Wright-Patterson Air Force Base, Ohio;
* Program Management and Acquisition Excellence, Aeronautical Systems
Command, Wright-Patterson Air Force Base, Ohio;
* Air Force Materiel Command, Wright-Patterson Air Force Base, Ohio;
* Small Diameter Bomb II Program Office, Panama City, Florida;
* C-130 Avionics Modernization Program Office, Wright-Patterson Air
Force Base, Ohio;
* F-16 Operational Flight Program M6/M6+ Program Office, Wright-
Patterson Air Force Base, Ohio;
* B-1 Bomber Radar Reliability and Maintainability Improvement Program
Office, Wright-Patterson Air Force Base, Ohio;
* Air Force Audit Agency, Wright-Patterson Air Force Base, Ohio.
Army:
* Office of the Assistant Secretary of the Army for Acquisitions,
Logistics and Technology;
* Army Materiel Command;
* Product Data and Engineering Working Group;
* Program Executive Office, Enterprise Information Systems;
* Program Executive Office, Missiles and Space, Redstone Arsenal,
Alabama;
* Integrated Air and Missile Defense Program Office, Redstone Arsenal,
Alabama;
* Extended Range/Multiple Purpose Unmanned Aircraft System, Redstone
Arsenal, Alabama;
* Guided Multiple Launch Rocket System Alternative Warhead, Redstone
Arsenal, Alabama;
* Joint Battle Command Platform Program Office, Ft. Monmouth, New
Jersey, and Aberdeen Proving Ground, Maryland;
* Army Audit Agency.
Navy:
* Office of the Deputy Assistant Secretary of the Navy for Acquisition
and Logistics Management;
* Office of the Deputy Assistant Secretary of the Navy for Management
and Budget;
* Program Executive Office for Integrated Warfare Systems;
* Program Executive Office, Command, Control, Communications,
Computers and Intelligence, San Diego, California;
* Naval Open Architecture Enterprise Team;
* Surface Electronics Warfare Improvement Program Office;
* E-6B Mercury Take Charge and Move Out Block I Modification Program
Office, Patuxent River Naval Air Station, Maryland;
* Joint High Speed Vessel Program Office;
* Navy Multiband Terminal Program Office, San Diego, California.
DOD other:
* Defense Data Management Team.
Industry:
* Aerospace Industries Association;
* National Defense Industrial Association;
* Northrop Grumman Corporation, Baltimore, Maryland;
* Boeing Corporation.
Federally Funded Research and Development Corporation:
* Software Engineering Institute, Carnegie Mellon University,
Pittsburgh, Pennsylvania.
Source: GAO.
Note: Unless otherwise specified, these organizations are located in
or near Washington, D.C.
[End of table]
To evaluate the extent to which selected defense acquisition programs
adhered to the updated requirements in DOD policy to document their
systems' long-term technical-data needs, we selected a non-
generalizable sample of 12 acquisition programs from a population of
about 50 programs. To draw the sample, we asked the three military
departments to identify all acquisition programs at the two highest-
value acquisition categories (ACAT I or II) that had reached the first
three acquisition milestones--A - Material Solution Analysis, B -
Technology Development, and C - Engineering and Manufacturing
Development--between September 2007 and August 2010. We chose
September 2007 because this was the first point at which both sets of
requirements for documenting long-term technical-data needs were in
effect, and we chose August 2010 because we selected our sample at
that time. Because too few Marine Corps programs reached one of these
milestones during this period, we excluded this service from our
evaluation. To draw the sample, we selected four programs from each
department, balancing the ACAT levels and milestones. We then selected
those programs that had most recently, at the time we drew our sample,
reached their respective milestones. We used this approach because DOD
updated its policies in 2007, and we wanted to allow as much time as
possible for the military departments to develop methods to respond to
the requirements in DOD's updated policies. Although findings from
this sample are not generalizable to all DOD acquisition programs, the
variety of circumstances that programs in our sample face can
illustrate important aspects of documenting a system's long-term
technical-data needs. Our sample includes a variety of acquisition
programs, including new systems (e.g., Joint High Speed Vessel),
modifications to existing systems (e.g., C-130 Avionics Modernization
Program), and systems that were primarily software (e.g., Joint Battle
Command-Platform). After completing our sample selection, we analyzed
the content of each program's acquisition strategy and acquisition
plan, which are required to document the program's long-term technical-
data needs. To conduct these analyses, we compared each program's
acquisition strategy and acquisition plan against certain criteria
from the July 2007 memorandum from the Under Secretary of Defense for
Acquisition, Technology and Logistics, DOD Instruction 5000.02, and
the DFARS.[Footnote 39] We could not compare the acquisition
strategies and plans in our sample to the voluntary guides that OSD
and the military departments issued in 2009 and 2010 because the
guides were issued after the majority of programs in our sample had
completed their acquisition milestone documentation. Two team members
concurrently conducted independent analyses of the same documentation.
We then compared the two sets of observations and reconciled any
differences with the assistance of a third analyst, when necessary. We
also provided our preliminary observations of each strategy to
officials in each program and considered additional information they
provided when our observations indicated that the program had not
addressed one or more of the requirements.
To evaluate the extent to which DOD has taken actions to improve
decision making by program managers on the long-term technical-data
needs for systems in the acquisition process, we identified recent
steps the department has taken. We interviewed officials in a variety
of offices including OSD and the acquisition headquarters offices for
each military department. We interviewed the officials responsible for
implementing any steps DOD took, and we obtained and evaluated
supporting documentation (e.g., the Defense Acquisition Guidebook and
guides issued by each military department). The officials we
interviewed represent organizations such as the Army's Product Data
and Engineering Working Group and the Air Force's Product Data
Acquisition Team.
For each objective, we assessed the reliability of the data we
analyzed by reviewing existing documentation related to the data
sources and interviewing knowledgeable agency officials about the data
that we used. We found the data sufficiently reliable for the purposes
of this report.
We conducted this performance audit from May 2010 to May 2011 in
accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe
that the evidence obtained provides a reasonable basis for our
findings and conclusions based on our audit objectives.
[End of section]
Appendix II: DOD's Implementation of Technical-Data Requirements Cited
in Recent Legislation and DOD Audit Agencies' Report Recommendations:
The information in this appendix supplements the information we
provided elsewhere in this report. The legal requirements, audit
recommendations, and the Department of Defense (DOD) and military
department implementation actions in this appendix are more narrowly
focused than those reviewed earlier in this report. Together, the two
sets of mandated actions, recommendations, and response actions
provide additional information about technical-data-related
requirements.
To evaluate the actions DOD has taken to implement the technical-data
requirements of the Duncan Hunter National Defense Authorization Act
for Fiscal Year 2009 and report recommendations by the Army and Air
Force Audit Agencies, we identified and evaluated the requirements and
recommendations. We then interviewed relevant DOD and Air Force and
Army officials and obtained key documentation such as updates DOD made
to the Defense Federal Acquisition Regulation Supplement to implement
section 202 of the Weapon Systems Acquisition Reform Act of 2009.
Technical-Data Requirements in the Duncan Hunter National Defense
Authorization Act for Fiscal Year 2009 and DOD's Response:
Section 822 of the Duncan Hunter National Defense Authorization Act
for Fiscal Year 2009[Footnote 40] requires DOD to take two technical-
data-related actions in the acquisition process. Table 2 lists these
two legislative requirements and DOD's response to each.
Table 2: Technical-Data-Related Requirements from the Duncan Hunter
National Defense Authorization Act for Fiscal Year 2009 and DOD's
Responses as of March 2011:
Legislative requirement: Requires the Secretary of Defense no later
than 270 days after the enactment of the act to: Issue policy guidance
on technical data for non-Federal Acquisition Regulation
agreements.[A] The act further requires that such non-FAR agreements
contain appropriate provisions relating to rights in technical data
consistent with this policy guidance;
DOD's Response: Not Implemented. DOD officials said that (a) DOD has
not issued any policy in response to the law; (b) prior to the
issuance of the law, multiple policies existed that address some
aspects of the law for some non-Federal Acquisition Regulation
agreements, and (c) DOD is evaluating whether to modify these policies
or issue a comprehensive policy in response to the law.
Legislative requirements: Requires the Secretary of Defense no later
than 270 days after the enactment of the act to: Submit a report to
the congressional armed services committees on the implementation of
section 2320(e) of Title 10, U.S. Code, for the assessment of long-
term technical-data needs to sustain major weapon systems, among other
matters;
DOD's Response: Not Implemented. DOD has not issued the required
report to the congressional armed-services committees. In September
2010, the Office of the Assistant Secretary of Defense for Logistics
and Materiel Readiness sent a letter to the Chairmen and Ranking
Members of the congressional defense committees notifying them that
the report would be issued within 90 days of the letter. The
department had not issued it as of March 2011.
Source: GAO analysis of the law and DOD documentation.
[A] With respect to this requirement, a non-Federal Acquisition
Regulation agreement means an agreement that is not subject to laws
pursuant to which the Federal Acquisition Regulation is prescribed,
including a transaction authorized under section 2371 of Title 10 and
a cooperative research and development agreement.
[End of table]
Recommendations on Technical Data by Army and Air Force Audit
Agencies' Reports, and the Services' Responses:
The Army Audit Agency and the Air Force Audit Agency recently issued
reports that address the acquisition of technical data. Table 3 lists
these reports, their recommendations, and the military departments'
responses to the recommendations.
Table 3: Army and Air Force Audit Agencies' Recommendations in
Technical-Data-Related Reports and the Military Departments' Responses
as of March 2011:
Army Audit Agency, Acquisition of Technical Data and Rights for Major
Army Systems, A-2009-0143-ALC (Alexandria, Va: July 6, 2009):
Recommendation: The report recommends that the Army take four actions;
Army's Response: The report stated that the Army had taken or would
take actions in response to each of the four recommendations.
Recommendation: Update Army Regulation 70-1 to reflect two memorandums
dated July 2007 (Under Secretary of Defense for Acquisition,
Technology and Logistics) and April 2008 (Acting Assistant Secretary
of the Army for Acquisition, Logistics and Technology). Both
memorandums require program managers to assess their system's long-
term technical-data needs and document that assessment in a data-
management strategy;
Army's Response: Not Implemented. The Army has not updated Army
Regulation 70-1. However, Army officials told us that an update to
Army Regulation 70-1 has been drafted. They told us that the update
will require program managers to assess the long-term technical-data
needs of their systems and to reflect that assessment in a data-
management strategy. These officials also told us that the Army plans
to issue the update to the regulation by June 2011.
Recommendation: Make sure that principal assistants responsible for
contracting advise program executive officers and program managers[A]
of their technical-data rights and responsibilities--detailed in
Title10 of U.S. Code and an April 2008 memorandum issued by the Acting
Assistant Secretary of the Army for Acquisition, Logistics and
Technology;
Army's Response: Implemented. In January 2009, the Army's Director,
Procurement Policy and Support, issued a memorandum about these
responsibilities for principal assistants responsible for contracting.
Recommendation: Establish a standardized decision matrix or checklist
that identifies and documents steps necessary to determine and secure
the level of data rights for each major Army system;
Army's Response: Implemented. In August 2010, the Army's Product Data
and Engineering Working Group issued a guidebook that includes a
worksheet to assist program managers as they assess their technical-
data needs.
Recommendation: Establish required training for personnel in the
acquisition of major Army systems to improve knowledge of technical
data and rights;
Army's Response: Not Implemented. The Army has not established the
recommended training courses, according to an Army headquarters'
official. However, the official told us that the Defense Acquisition
University has courses and provides training for the Army acquisition
workforce. Defense Acquisition University personnel told us that prior
to the Army report they taught courses on technical-data rights in the
acquisition process and that they adjusted their courses to be
consistent with DOD policy.
Air Force Audit Agency, Technical Data Management, F2009-0006-FC3000
(Washington, D.C.: May 8, 2009):
Recommendation: The report recommends that the Air Force take two
actions;
Air Force's Response: The report indicates that both recommendations
are closed. However, we found that the Air Force had not taken action
to implement one of the recommendations.
Recommendation: Issue an interim guidance memorandum on the technical-
data provisions included in the 2007 National Defense Authorization
Act, pending release of an update to Air Force Instruction 63-101,
Acquisition and Sustainment Life Cycle Management;
Air Force's Response: Implemented. The Air Force included the
recommended guidance in an update of Air Force Instruction 63-101
rather than issue guidance in an interim memorandum.
Recommendation: Develop a technical-data checklist to incorporate in
the Air Force's acquisition sustainment tool kit, which is a resource
for acquisition personnel;
Air Force's Response: Not Implemented. Air Force officials told us
that the Air Force has not developed a technical-data checklist to
incorporate into the acquisition sustainment tool kit. However,
according to these officials, they plan to revise the tool kit by
August 2011 to incorporate the recommended checklist.
Source: GAO analysis of Army and Air Force documentation.
[A] Principal assistants responsible for contracting are senior
officials who are responsible for contracting and also support program
executive officers and program managers. Program executive officers
and program managers are responsible for (1) acquiring and sustaining
weapon systems, (2) assessing the long-term technical-data-rights
needs of those systems, and (3) documenting technical-data assessments
in a data-management strategy, among other things.
[End of table]
[End of section]
Appendix III: Comments from the Department of Defense:
Office Of The Under Secretary Of Defense:
Acquisition, Technology And Logistics:
3000 Defense Pentagon:
Washington, Dc 20301-3000:
May 3, 2011:
Mr. Jack E. Edwards:
Director, Defense Capabilities and Management:
U.S. Government Accountability:
Office, 441 G Street, NW:
Washington, DC 20548:
Dear Mr. Edwards:
This is the Department of Defense (DoD) response to the GAO draft
report, GA0-11-469, "Defense Acquisition: DoD Should Clarify
Requirements for Assessing and Documenting Technical Data Needs,"
dated April 5, 2011 (GAO Code 351497). Detailed comments on the report
recommendations are enclosed.
Sincerely,
Signed by:
Shay D. Assad:
Director, Defense Procurement and Acquisition Policy:
Enclosure: As stated.
[End of letter]
GAO Draft Report Dated April 5, 2011:
GAO-11-469 (GAO Code 351497):
"Defense Acquisition: DOD Should Clarify Requirements For Assessing
And Documenting Technical Data Needs"
Department Of Defense Comments To The GAO Recommendations:
Recommendation 1: The GAO recommends that the Secretary of Defense
direct the Under Secretary of Defense for Acquisition, Technology and
Logistics to issue updates to the acquisition and procurement policies
that clarify requirements for documenting long-term technical data
requirements in program acquisition strategies and acquisition plans.
Among other things, DoD should clarify the level and type of detail
required for acquiring technical data and technical data rights that
should be included in acquisition strategies and acquisition plans.
(See page 24/GAO Draft Report.)
DoD Response: Concur. The Department expects to issue the recommended
clarification this calendar year.
Recommendation 2: The GAO recommends that the Secretary of Defense
direct the Under Secretary of Defense for Acquisition, Technology and
Logistics to issue instructions for program managers to use when
conducting business case analyses that are part of the process for
determining the levels and types of technical data and technical data
rights needed to sustain their systems. The instruction should
identify the elements to be included in the analyses and the types of
information to be documented in reports on the analyses. In addition,
OSD should consider consolidating the requirement for business case
analyses with updates to clarify requirements for documenting long-
term technical data requirements. (See page 24/GAO Draft Report.)
DoD Response: Concur. The Department expects to issue guidance related
to this recommendation this calendar year.
[End of section]
Appendix IV: GAO Contact and Staff Acknowledgments:
GAO Contact:
Jack E. Edwards, (202) 512-8246 or edwardsj@gao.gov:
Staff Acknowledgments:
Key contributors to this report were Carleen Bennett, Assistant
Director; Larry Bridges; Simon Hirschfeld; Amber Keyser; James P.
Klein; Katherine Lenane; Richard Powelson; Michael Silver; and Ryan
Starks.
[End of section]
Related GAO Products:
Federal Contracting: Opportunities Exist to Increase Competition and
Assess Reasons When Only One Offer Is Received. [hyperlink,
http://www.gao.gov/products/GAO-10-833]. Washington, D.C.: July 26,
2010.
Defense Management: DOD Needs Better Information and Guidance to More
Effectively Manage and Reduce Operating and Support Costs of Major
Weapon Systems. [hyperlink, http://www.gao.gov/products/GAO-10-717].
Washington, D.C.: July 20, 2010.
Defense Logistics: Improved Analysis and Cost Data Needed to Evaluate
the Cost-effectiveness of Performance Based Logistics. [hyperlink,
http://www.gao.gov/products/GAO-09-41]. Washington, D.C.: December 19,
2008.
Weapons Acquisition: DOD Should Strengthen Policies for Assessing
Technical Data Needs to Support Weapon Systems. [hyperlink,
http://www.gao.gov/products/GAO-06-839]. Washington, D.C.: July 14,
2006.
Defense Management: Opportunities to Enhance the Implementation of
Performance-Based Logistics. [hyperlink,
http://www.gao.gov/products/GAO-04-715]. Washington, D.C.: August 16,
2004.
Defense Logistics: Opportunities to Improve the Army's and the Navy's
Decision-making Process for Weapons Systems Support. [hyperlink,
http://www.gao.gov/products/GAO-02-306]. Washington, D.C.: February
28, 2002.
[End of section]
Footnotes:
[1] Defense Federal Acquisition Regulation Supplement (DFARS) section
252.227-7013 defines technical data as "recorded information,
regardless of the form or method of the recording, of a scientific or
technical nature (including computer software documentation)— [but not
including] computer software or data incidental to contract
administration, such as financial and/or management information."
Technical data for weapon systems includes drawings, specifications,
standards, and other details necessary to ensure the adequacy of item
performance, as well as manuals that contain instructions for
installation, operation, maintenance, and other actions needed to
support weapon systems.
[2] GAO, Federal Contracting: Opportunities Exist to Increase
Competition and Assess Reasons When Only One Offer Is Received,
[hyperlink, http://www.gao.gov/products/GAO-10-833] (Washington, D.C.:
July 26, 2010);Weapons Acquisition: DOD Should Strengthen Policies for
Assessing Technical Data Needs to Support Weapon Systems, [hyperlink,
http://www.gao.gov/products/GAO-06-839] (Washington, D.C.: July 14,
2006); Defense Management: Opportunities to Enhance the Implementation
of Performance-Based Logistics, [hyperlink,
http://www.gao.gov/products/GAO-04-715] (Washington, D.C.: Aug. 16,
2004); and Defense Logistics: Opportunities to Improve the Army's and
the Navy's Decision-making Process for Weapons Systems Support,
[hyperlink, http://www.gao.gov/products/GAO-02-306] (Washington, D.C.:
Feb. 28, 2002).
[3] Hereinafter, we use the term "the 2007 National Defense
Authorization Act" to describe section 802 of the John Warner National
Defense Authorization Act for Fiscal Year 2007, Pub. L. No. 109-364
(2006).
[4] Pub. L. No. 111-23 § 202 (2009). In response to the technical data
provisions of this law, DOD published an interim rule amending the
DFARS in February 2010. The interim rule stated, among other things,
that the acquisition of complete technical data packages is one
measure to ensure competition (or the option of competition). This
interim rule was finalized in September 2010 without change as DFARS
207.106 (S-72).
[5] We also included information on the extent to which DOD has
implemented additional legislative provisions and audit
recommendations related to technical data in the acquisition process
in appendix II.
[6] See related GAO products at the end of this report for additional
publications on related topics.
[7] Because too few Marine Corps programs reached a major milestone in
this period, we did not include any programs from this service in our
sample.
[8] DOD classifies its acquisition programs into acquisition
categories (ACAT) that depend on the value and type of acquisition.
ACAT I programs are estimated to require an eventual total expenditure
of more than $365 million for research, development, test and
evaluation, or more than $2.19 billion for procurement, or are
designated as special interest by the milestone decision authority.
ACAT II programs do not meet the criteria for ACAT I, but are
estimated to require more than $140 million for research, development,
test and evaluation, or more than $660 million for procurement (all
cost estimates are in fiscal year 2000 constant dollars). ACAT III
programs do not meet the criteria for ACAT II or above.
[9] As outlined in DOD Instruction 5000.02, Operation of the Defense
Acquisition System (Dec. 8, 2008), the defense acquisition system uses
"milestones" to oversee and manage acquisition programs. Each
milestone has specific statutory and regulatory requirements that a
program must meet in order to proceed to the next phase of the
acquisition process. We selected programs that reached the first three
milestones: A - Materiel Solution Analysis; B - Technology
Development; and C - Engineering and Manufacturing Development.
[10] Specifically, we incorporated requirements from the Under
Secretary of Defense for Acquisition, Technology, and Logistics-issued
memorandum, Data Management and Technical Data Rights (July 19, 2007);
DOD Instruction 5000.02, enclosure 12(9) (Dec. 8, 2008); and DFARS
207.106 (S-70).
[11] The government typically obtains rights in technical data through
a license granted as part of the contract. The standard license rights
that are granted to the government are unlimited rights, government
purpose rights, or limited rights, but different rights may be
negotiated in unusual circumstances. The contractor or licensor
retains all rights in the data not granted to the government. DFARS
227.7103-4(a) and DFARS 227.7103-5.
[12] DOD officials told us that in practice many program offices use
one document to satisfy the requirement for both the acquisition
strategy and acquisition plan.
[13] Pursuant to section 2321 of Title 10, U.S. Code, DOD has the
right to challenge asserted restrictions on technical data under
certain circumstances. DFARS 227.7103-13 (b) states that "[t]he
challenge procedures required by 10 U.S.C. 2321 could significantly
delay awards under competitive procurements. Therefore, avoid
challenging asserted restrictions prior to a competitive contract
award unless resolution of the assertion is essential for successful
completion of the procurement."
[14] However, in some limited circumstances, restrictive markings may
be challenged at any time. DFARS 227.7103-13(c)(1).
[15] [hyperlink, http://www.gao.gov/products/GAO-02-306].
[16] [hyperlink, http://www.gao.gov/products/GAO-04-715].
[17] [hyperlink, http://www.gao.gov/products/GAO-06-839].
[18] [hyperlink, http://www.gao.gov/products/GAO-10-833].
[19] Air Force Audit Agency, Technical Data Management, F2009-0006-
FC3000 (Washington, D.C.: May 8, 2009).
[20] Army Audit Agency, Acquisition of Technical Data and Rights for
Major Army Systems, A-2009-0143-ALC (Alexandria, Va: July 6, 2009).
[21] [hyperlink, http://www.gao.gov/products/GAO-06-839].
[22] DOD policy requires that all acquisition programs develop or
update an acquisition strategy document at major milestones in the
acquisition process.
[23] The final policy changes are included in DFARS 207.106 (S-70).
[24] The acquisition policy changes apply to ACAT I and II programs,
and the procurement policy changes apply to weapon systems and
subsystems of major weapon systems. Throughout this report when we
refer to programs and program managers, we are referring to those
programs and program managers specifically affected by these policies.
[25] DOD issued an interim rule amending the DFARS effective September
6, 2007. The rule was adopted as final (with a minor change) on
December 29, 2009 as DFARS 207.106 (S-70).
[26] The Air Force Acquisition Excellence and Change Management Office
issued this guide as a slide presentation distributed to program
officials. The presentation outlined Air Force guidelines for
developing an acquisition strategy.
[27] The Product Data Acquisition Integrated Product Team has also
taken additional actions to improve technical-data-related decisions,
including recommending changes to Air Force-level policy.
[28] The Army established the Product Data and Engineering Working
Group in March 2005 to serve as a forum for determining requirements
for and resolving issues associated with the management and use of
technical data. The group consists of representatives from Army
offices such as headquarters, major commands (e.g., Army Materiel
Command), and program executive officers.
[29] U.S. Navy, Naval Open Architecture Contract Guidebook for Program
Managers, (Washington, D.C.: June 30, 2010). Open architecture is a
group of business and technical practices that, when implemented in
the acquisition process, result in systems that are modular and
interoperable.
[30] GAO, Internal Control: Standards for Internal Control in the
Federal Government, [hyperlink,
http://www.gao.gov/products/GAO/AIMD-00-21.3.1] (Washington, D.C.:
November 1999).
[31] DFARS 207.106 (S-70).
[32] Under Secretary of Defense for Acquisition, Technology and
Logistics memorandum: Implementation Directive for Better Buying Power-
Obtaining Greater Efficiency and Productivity in Defense Spending
(Nov. 3, 2010).
[33] The memorandum requires that the analysis be conducted in concert
with the engineering trade-off analysis. It requires that the analysis
outline the open-systems-architecture approach and technical-data
rights needed to ensure a life-cycle consideration of competition in
the acquisition of weapon systems.
[34] Milestone B marks the entry into the Engineering and
Manufacturing Development phase of the acquisition process.
[35] Although, OSD had not issued policy or other internal controls,
in April 2011, OSD issued a guidebook that program manager may choose
to follow to develop business-case analyses for their technical-data
rights decisions. The Principal Deputy Assistant Secretary of Defense
for Logistics and Materiel Readiness issued the Product Support
Business-Case Analysis Guidebook. The guidebook provides a
standardized process and methodology for writing, aiding decision
making, and providing analytical decision support for a business-case
analysis of product support decisions.
[36] GAO, Defense Logistics: Improved Analysis and Cost Data Needed to
Evaluate the Cost-effectiveness of Performance Based Logistics,
[hyperlink, http://www.gao.gov/products/GAO-09-41] (Washington, D.C.:
Dec. 19, 2008).
[37] Performance based logistics is the purchase of performance
outcomes, such as system availability, rather than the purchase of
individual elements of logistics support--such as parts, repairs, and
engineering support. Performance based logistics is DOD's preferred
approach to weapon system product support. Product support is the
package of support functions required to maintain the readiness of
weapon systems. Technical data is one of the 11 elements of product
support.
[38] At the time of this report, we had not evaluated whether this
guidebook met the intent of our 2008 recommendation.
[39] Specifically, we incorporated requirements from DOD Instruction
5000.02 enclosure 12(9) December 8, 2008; and the Defense Federal
Acquisition Regulation Supplement 227.207.106 (S-70).
[40] Pub. L. No. 110-417 § 822 (Oct. 14, 2008).
[End of section]
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