Air university

Air Force Fellows (SDE)

AIR UNIVERSITY

Hard skillS, Soft Skills, Savviness and Discipline--

Recommendations for successful acquisiton:

case studies of selected boeing weapons programs

by

Roger J. “Torch” Witek, Lieutenant Colonel, USAF

Advisor: Mr. Eric Briggs, Director Secretary of Defense Corporate Fellows Program

Maxwell Air Force Base

May 2008

The views expressed in this academic research paper are those of the author and do not reflect the official policy or position of the US government or the Department of Defense. In accordance with Air Force Instruction 51-303, it is not copyrighted, but is the property of the United States government.

Lieutenant Colonel (Colonel select) Roger J. “Torch” Witek is currently a Secretary of Defense Corporate Fellow assigned to The Boeing Company Weapons Division in Saint Charles, Missouri. He is a command pilot with more than 2,700 hours of flight time in the F-15A/B/C/D and the F-4E/F with 132 combat hours. “Torch” Witek has held a variety of flying assignments to include Deputy Commander, 3^rd Operations Group and Commander, 19th Fighter Squadron, Elmendorf Air Force Base, Alaska. He has served on the United States Forces Korea staff as Chief of Special Technical Operations. “Torch” Witek is a graduate of and was an instructor at the German Air Force / United States Air Force F-4E/F Weapons School. He is a distinguished graduate of the Reserve Officer Training Corps, Undergraduate Pilot Training, and Squadron Officer School. “Torch” Witek has earned a Bachelor of Science degree in Mechanical Engineering from the University of Illinois, a Master of Science degree in Mechanical Engineering from the University of Idaho, a Master of Arts degree in Military Operational Art and Science from Air Command and Staff College at Air University, and Master of Arts degree in Airpower Art and Science from the School of Advanced Airpower and Space Studies at Air University. Lieutenant Colonel Witek’s next assignment is to the Office of the Secretary of Defense for Policy, Global Security Affairs.

Each year, two officers with highly successful operational command and staff backgrounds from each Service are assigned to rotating Fortune 500 companies to glean the best of change, innovation, and leading edge business practices that could be implemented to transform the Department of Defense (DoD). The program that makes this possible is the Secretary of Defense Corporate Fellows Program (SDCFP). The program’s website offers a complete overview and can be found at http://www.ndu.edu/sdcfp/. Usually, SDCFP fellows write their respective senior service school graduation research paper requirements about the best business practices they experienced with their respective companies. Since the SDCFP fellows collage their relevant observations and recommendations in an outbrief to Pentagon officials at the end of each school year, I decided to write a more detailed paper for the DoD acquisition community using my perspective as a career-long fighter pilot.

I was fortunate to be assigned to The Boeing Company and extremely privileged that Virginia Barnes, the Vice-President (VP) of the Weapons Division in Saint Charles, Missouri, fought to sponsor me. As VP she is responsible for over 1000 employees and a portfolio that includes the Harpoon, Stand-off Land Attack Missile-Extended Range (SLAM-ER), Conventional Air Launched Cruise Missile (CALCM), Joint Direct Attack Munition (JDAM), and the Small Diameter Bomb (SDB) programs. She has a wealth of experience with naval support systems and the International Space Station. Ms. Barnes takes pride in mentoring and loves to teach the “soft skills”; those ultra inclusiveness techniques backed up by a “kill with kindness” demeanor that are needed to build interpersonal relationships between people in government and industry and between prime contractors and their suppliers.

Ms. Barnes’ position as VP and her joy for mentoring allowed me access to the rest of The Boeing Company leaders. From the start, she secured a slot for me at the much heralded The Boeing Leadership Center (BLC) Program Manager’s Workshop (PMW). For a week, not only did the BLC indoctrinate me on the company’s eight program management best practices, but the PMW was the foundation for developing career long contacts with professionals working on the 787 Dreamliner, Army’s Future Combat System (FCS), and National Aeronautics and Space Administration’s International Space Station. Two months later, Ms. Barnes sent me to the LEAN+ Conference in Seattle, Washington, for a one week conference. With 1200 attendees, including The Boeing Company customers, I learned about continuous process improvement and the elimination of waste. Ms. Barnes coordinated an extra day with tours and interviews with the Phantom Works Support Technologies Program Manager (PM), B-2/CALCM Conversion PM, F-22 Assembly Center Senior Manager, 737 Production System Manager, and the 787 Chief Pilot. I also attended her boss’s (Mr. Chris Chadwick, VP and General Manager of Global Strike Systems) leadership team offsite programs as well. From there, I coordinated several interviews and tours with the F/A-18 and F-15E PMs and with the Virtual Warfare Center (VWC) -- all in Saint Louis, Missouri. Besides Saint Louis and Seattle, Ms. Barnes also sent me to southern California and to Philadelphia to learn about the satellite and rotary aircraft businesses.

With an efficiency I grew accustomed to expect, Ms. Barnes hosted the first of nine SDCFP Company Days. She secured keynote speakers such as John Lockard, President, Precision Engagement and Mobility Systems; Chris Chadwick, VP and General Manager (GM) of Global Strike Systems; Dennis Muilenburg, VP and GM of Combat Systems; Tony Parasida, VP and GM of Airborne ASW and ISR Systems; George Roman, VP of Government Relations; and Steve Goo, VP of Program Management. These senior level executives talked about The Boeing Company’s Leadership and Management Models and Program Management Best Practices, strategic to tactical alignment, and United States and international defense markets.

Half way through my fellowship, Ms. Barnes moved up to VP and Deputy GM for FCS in St. Louis and continued to mentor me. Debbie Rub-Zenko became the new VP of Weapons. Ms. Rub-Zenko came from Missile Defense Systems in Huntington Beach, California. The Boeing Company decided to merge the missiles and weapons division to leverage competencies off each other. Ms. Rub-Zenko added tours with her Patriot Advanced Capability-3 and Aegis Missile Defense System leadership teams to my previously planned southern California trip.

My mentors day-to-day at the Weapons Division were Dan Jaspering, Director of Direct Attack; James Brooks, SDB PM, and Mike Wasylczyk, Focused Lethality Munition (FLM) PM. Dan, Mr. Jaspering sent me to Earned Value Management (EVM) training where I learned the intricacies of building work packages and good executable schedules; it taught me what it means to balance the three legged stool of acquisition – cost, schedule, and technical performance. I lived the SDB daily battle rhythm (meeting schedule) and followed FLM from a Joint Concept Technology Demonstration (JCTD) to a Low Rate Initial Production (LRIP) Milestone B decision. I saw a FLM JCTD live-fire event at Holloman Air Force Base (AFB), New Mexico, with the Secretary of the Air Force, Michael Wynne, in attendance. Besides the opportunity to speak to Sue Payton, Assistant Secretary of the Air Force for Acquisitions, at the Air Armament Symposium, I traveled to the SDB and FLM Systems Project Office (SPO) at Eglin AFB, Florida several times to experience the military/customer side of acquisition. There, I was included in audiences with Judy Stokley, Deputy Air Force Program Executive Officer for Weapons.

At Eglin AFB, Colonel Richard Justice, Commander, 918^th Armament Systems Group (ARSG) for Miniature Munitions, allowed me access to his team. Richard Walley, Deputy Director, 918^th ARSG; Bill Wise (SDB-II, 682^nd Armament Systems Squadron (ARSS)) and Greg Postulka (SDB-I, 681^st ARSS), are dedicated government civilians and contractors currently leading and supporting the SDB program. They were valuable in providing archival and current data. And even with my few months experience in “acquisition”, Lieutenant Colonel Chris Baird, Commander, 681^st ARSS, treated me like a peer.

This corporate experience would not be possible without Eric Briggs, Director of SDCFP. He is a one man shop with a limited budget at the National Defense University. Mr. Briggs has, however, the Office of Net Assessment’s and Mr. Andrew Marshall’s clout to recruit Fortune 500 companies every year to support this program. Mr. Briggs also coordinated orientation briefings and training from senior military and civilian leaders, government think tanks and research labs, and the University of Virginia Darden Graduate School of Business.

Aside from the experience of working at The Boeing Company, I enjoyed learning best business practices and interesting perspectives from the Company Days at this year’s SDCFP participating sponsors: Oracle in Reston, Virginia, Cisco Systems in San Jose, California; 3M Company in Saint Paul, Minnesota; CACI-Athena in Arlington, Virginia; Amgen in Thousand Oaks, California; Time Warner/CNNMoney.com, in New York City, New York; Lockheed Martin Missiles and Fire Controls, Orlando, Florida; and SRA International in Fairfax, Virginia.

Finally, the motivation to complete this paper lies in the Air Force Officer Doctrine Development and Education Center requirement. There are approximately 100 Air Force Fellows (AFF) in over three dozen programs who receive intermediate or senior developmental education credit. Many thanks are given for the patience of Ms. Dee Taylor, Director, AFF; Staff Sergeant Kimberly Langston, AFF Non-Commissioned Officer in Charge and Senior Airmen Marcus Henry for keeping us fellows in check.

ABSTRACT

This report analyzes The Boeing Company’s Joint Direct Attack Munition (JDAM) and the Small Diameter Bomb Increment One (SDB-I) defense acquisition weapons programs in terms of leadership, teaming, strategy, and execution. A description of defense acquisition processes are covered in Chapter 1. Chapter 2 follows with a historical review and editorial of the latest in defense acquisition transformation and Department of Defense expectations for defense contractors. The JDAM case study as a Defense Acquisition Pilot Program is described in Chapter 3. The managerial actions from that program are compared through the lens Professor Jim Collins provides in his book, Good to Great. Chapter 4 is the hallmark, stand alone chapter that presents the ongoing SDB-I case study that has not been told at any length in any acquisition publication as of yet. Although the case studies are presented chronologically; leadership, teaming, strategy, and execution lessons are summarized at the end of Chapters 3 and 4. Chapter 5 analyzes the Laser JDAM, the Focused Lethality Munition (a SDB-I derivative as a Joint Capabilities Technology Demonstration), and the Small Diameter Bomb - Increment Two (SDB-II, a risk reduction competition phase before Milestone B) programs to determine whether these programs are following any lessons from JDAM and SDB-I. Chapter 6 recommends that “hard skill” leadership is needed for development programs, “soft skill” teaming arrangements are needed in both development and production programs, business savviness allows win-win scenarios for both government and industry, and disciplined, repeatable processes are key for successful execution.

Chapter Page

Defense Acquisition 101 ………………………………………………. 2

U.S. Code and the FAR ……………………………………….. 3

The “Big A” Trinity …………………………………………… 3

JCIDS …………………………………………………. 4

PPBES ………………………………………………… 5

DAS, the “little a” ……………………………………... 7

What to Remember about Acquisition …………………………….. … 10

Commissions, Directives, and Analyses ……………………………… 15

Recent Initiatives ………………………………………………. 16

DSB ……………………………………………………. 17

QDR ……………………………………………………. 17

BGN ……………………………………………………. 17

DAPA ………………………………………………….. 18

DAT ……………………………………………………. 18

BTA ……………………………………………………. 19

Government Accounting Organization ……………………….. 19

Nunn-McCurdy Breaches …………………………………….. 20

Stakeholder Expectations of Industry ………………………………… 21

“The A-Team” ……………………………………………....... 21

Government Expectations …………………………………….. 23

On Time, On Cost, On Target ………………………… 23

Ownership of Product Health ………………………….. 23

Realistic Marketing and Budgeting ……………………. 23

Matured Technologies ………………………………….. 24

Flexibility ……………………………………………….. 24

Lessons from Transformation and Expectations ……………………….. 24

In the Beginning, It Was Going to be Different ………………………. 28

First Who, Then What ………………………………………… 28

Integrated Product Teams (IPTs)……………………… 29

More Effective Leadership …………………………… 30

DAPP, There’s a Waiver for Every Rule ……………………… 31

It’s the Economy, Stupid ……………………………………… 32

Price-based Strategy …………………………………… 33

Supply Trust and Motivation …………………………… 35

Rolling Down-Select …………………………………… 36

The Boeing Company and JPO Continue the Saga …………………… 37

Compromise and Supplier Management ……………………….. 37

Incentives, PPCC, and Lean ………………………………….... 39

New Product Development and Technical Insertions ………… 41

Carrots and Sticks for Price-based Acquisition………………… 42

Summary of WWJD (What Would JDAM Do?) ……………………….. 45

The Leap from Labs to Industry ……………………………………….. 52

MNS, ORD, and AoA ………………………………………….. 52

Catalysts and Programming ……………………………………. 53

A JDAM Repeat? More of the Same, and Different …………………... 55

Champions, Mold Breakers, and Stable Requirements ………… 56

The “Go-Fast” Plan and Picking IPT Members ………………….. 58

Alien Autopsy …………………………………………………. 59

Buy, Make, or Sell “Build to Print” ……………………………. 60

Trunk Monkey Certified ………………………………………. 61

SAMP Deviations with Disciplined Source Selection …………. 62

SDD Investment and Production Challenges …………………………… 64

In the Interest of Time …………………………………………… 65

More Organizational Support …………………………… 66

Camp McClendon ………………………………………. 66

Battle Rhythm ………………………………………….. 67

Incentives ………………………………………………. 67

Seamless Verification …………………………………………… 68

Fielding Accolades and Challenges …………………………………….. 69

Lessons from the Perry Award Winner …………………………………. 72

Laser JDAM ……………………………………………………………. 78

The Customer May Not Know What It Needs …………………. 78

Going Backwards on Requirements ……………………………. 80

FLM …………………………………………………………………….. 81

Brief Background about JCTDs ………………………………... 82

FLM MUA, Attributes, and Challenges ………………………… 83

SDB-II ………………………………………………………………….. 85

Why the Re-compete? ………………………………………….. 86

Technology Priority Challenge …………………………………. 87

What’s the Future? ……………………………………………………… 87

6 RECOMMENDATIONS ………………………………………………. 91

Leadership and the Hard Skills …………………………………………. 91

#1: Each major acquisition program needs a champion

who picks one priority. ………………………………….. 92

#2: Choose “glass breakers” to lead development programs. ….. 93

Teaming and the Soft Skills ……………………………………………... 95

#3: Build inclusive IPTs at all levels and empower them. ..……. 96

#4: Motivate, trust, verify, coach, and reward suppliers. …......... 97

Strategy and Business Savviness ………………………………………. 98

#5: Keep improving competition transparency. ………………. 98

#6: Embrace price-based acquisition, incentivize

behavior, and expect warranties. ……………………….. 98

Discipline and Execution ……………………………………………….. 100

#7: Limit KPPs to avoid requirements creep …………………… 101

#8: Maintain a disciplined battle rhythm and protect

your organizational wall! ………………………………. 100

Applicability for Bigger Programs ……………………………………… 102

Conclusion ………………………………………………………………. 103
BIBLIOGRAPHY ………………………………………………………. 105

Illustrations

Figure/Table
1.1 Defense Acquisition Structure ……………………………………… 4

1.2 JCIDS CBA Process ……………………………………………….. 6

1.3 PPBES On/Off Year Processes ……………………………………… 8

1.4 Milestone Framework ……………………………………………….. 10

1.5 Acquisition Categories ………………………………………………. 11
2.1 Past Acquisition Transformation …………………………………….. 16

2.2 DAPA Recommendations …………………………………………… 18

2.3 Seven Deadly Sins of Program Management ………………………... 20
3.1 DoD and Commercial Comparison ………………………………….. 29

3.2 JDAM Waiver Metrics ………………………………………………. 33

3.3 PPCC Carrots and Sticks ……………………………………………. 44

3.4 JDAM Accuracy, PPCC, and Production …………………………… 46

3.5 JDAM JPO-MD/Boeing Lessons …………………………………….. 47
4.1 Original SDB Program ……………………………………………….. 55

4.2 SDB Baseline Program ………………………………………………… 56

4.3 SDB Part Changes from CAD to SDD/Production ……………………. 60

4.4 SDB Early and Often …………………………………………………. 66

4.5 SDB Risk versus Test …………………………………………………. 70

4.6 SDB SPO-Boeing Lessons ……………………………………………. 73

5.2 Laser JDAM, FLM, and SDB-II Lessons …………………………….. 88

6.2 Acquisition Spectrum …………………………………………………. 103

—Robert McNamara, former U.S. Secretary of Defense¹

Variability exists in any operation and needs to be managed. Decision making in operations is very context dependent and measuring success can present challenges—especially when some decisions are government regulated. In an attempt to provide the status of Department of Defense (DoD) acquisition programs, color coded Probability of Program Success (PoPS) measures were created.² According to typical PoPS scores, “red” signifies a high risk program or that cost, schedule or technical performance has been poor. “Yellow” is a medium risk program or that cost, schedule or technical performance has been declining. “Green” is a low risk program performing according to plan. When Sue Payton, Assistant Secretary of the Air Force for Acquisition, took over her job in 2006, she inherited 127 significant and expensive programs that promised to deliver new and enhanced combat capability to the warfighter—10 percent of which she graded “red” in May 2007. “We wake up every morning worrying,” Ms Payton exulted, “about getting those red programs turned to yellow, and the yellow programs turned to green.”³

At the 2007 Air Armament Symposium in October 2007, Major General David Eidsaune, Program Executive Officer for Weapons and Commander of the Air Armament Center, reported that the weapons programs worth $3.9 billion were graded 74 percent in the green, 21 percent in the yellow, and 5 percent in the red.⁴ In front of over 700 attendees and more than two dozen major defense contractors and small business companies, Boeing’s Joint Direct Attack Munition (JDAM) and Small Diameter Bomb (SDB) programs were heralded as “model” programs. Although JDAM and SDB have not gone without challenges, this report will analyze the leadership, teaming, strategy, and execution that made those programs successful. Dissertations and case studies have been done on the early JDAM program years and will be summarized and updated. Similarly, the SDB case study will be presented for practically the first time. Then the follow-on JDAM and SDB derivative programs will be compared to their predecessors’ footsteps to reinforce the conclusions that “hard skill” leadership is needed for development programs, that “soft skill” teaming arrangements are needed in both development and production programs, that business saviness allows win-win scenarios for both government and industry, and that discipline is key for successful execution.

In order to judge, critique, or much less model any DoD acquisition program, one must understand what measures of merit programs are being graded against. The complex DoD acquisition system means managers are constantly trying to improve the “system of systems” (SoS).⁵ In this case, the DoD acquisition SoS is unlike a combat aircraft combining the airframe, engines, avionics, radar, and weapons subsystems or a fighter data link combining the radar picture of many different combat aircraft for a single combat aircraft to use. Instead of combining technologies, the DoD acquisition SoS combines laws and governmental processes. This chapter provides a review of defense acquisition laws, regulations, and structure.⁶ The next chapter summarizes defense acquisition transformation pertaining to commissions, panel assessments, congressional amendments and government expectations of industry.

Defense Acquisition 101

Unfolding the regulatory practices that affect defense acquisition is an important part of understanding budgeting and program funding. The defense acquisition SoS is strictly guided by United States (U.S.) Code, the Federal Acquisition Regulation (FAR), and a trinity of governmental systems known as the Big “A” Acquisition Process.

Title 10 of the U.S. Code dealing with the Armed Forces generally prescribes how the DoD goes about manning, training, and supplying their military services. The 1941 Fifth Supplemental DoD Appropriations Act, now known as the Berry Amendment has become part of Title 10. In order to protect the U.S. industrial base during periods of war, the Berry Amendment gives acquisition preference to domestically produced, manufactured, or home grown food, clothing, fabrics, and specialty metals.

Title 41 governs public contracts and requires the DoD to use the FAR for its acquisition processes.⁷ The FAR is a series of policies and procedures that demand contractors meet governmental customer needs in terms of cost, quality, and timeliness and to conduct this business fairly and in an ethical manner. The FAR also includes socioeconomic requirements, such as certain items must be purchased only from U.S. firms and for large firms to subcontract to small, disadvantaged businesses, specifically those being owned by women or minorities.

The DoD also has an agency supplement, the Defense Federal Acquisition Regulation Supplement (DFARS).⁸ In January 2005, the DFARS was amended, however, to include exceptions to Title 10 for the acquisition for food, specialty metals, and measuring tools from outside the U.S. when supporting contingency operations or meeting an urgent need.⁹