From the U.S. Government Accountability Office, www.gao.gov Transcript for: 2017 DOD Weapons Programs Quick Look Description: GAO's 2017 review of the Department of Defense's major weapons system acquisitions. We'll talk about what still needs to be done to improve oversight Related GAO Work: GAO-17-333SP: Defense Acquisitions: Assessments of Selected Weapons Programs Released: March 2017 [ Background Music ] [ Narrator: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. It's March 2017. Every year, GAO looks at the Department of Defense's major weapon system acquisitions, an area on GAO's High Risk List. A team led by Mike Sullivan, a director in our Acquisition and Sourcing Management team, recently completed the 2017 quick look review of DOD's weapons portfolio. Sarah Kaczmarek sat down with Mike to talk about what they've found. [ Sarah Kaczmarek: ] GAO has been doing a quick look at DOD's major weapon systems for a number of years now. For those of us who are less familiar with this project, could you tell me a little bit about the scope of what you look at and how much money we're talking about here? [ Mike Sullivan: ] Sure. So the portfolio of major weapon systems that we look at, these are the really big investments that DOD is making. Things like fighter aircraft, destroyer ships, aircraft carriers, you know, in the Army, maybe tactical vehicles and tanks. So they're multiple-year, multiple-billion-dollar investments that they make. So the portfolio this year includes 78 of those big programs. The money that we're talking about, the investment in these weapon systems, total up to an investment of about $1.4 trillion. [ Sarah Kaczmarek: ] Well, that is certainly a huge amount of money. What would you say are DOD's kind of main challenges to managing these major weapon systems? [ Mike Sullivan: ] Obviously, very risky. Just on the face of it, they're some of the most cutting-edge technologies in the world, really. So that's one big challenge. I think budgets are a challenge. Since around 2009, 2010, the defense budget has been very tight, so they've had to use their money a lot more judiciously. [ Sarah Kaczmarek: ] So it sounds like DOD is starting to make some progress. Could you tell me a little bit more about that? [ Mike Sullivan: ] Sure. In the past, the department would usually come to the table with a weapon system it would need that was kind of a quantum leap in technology. So the warfighter would write requirements, for example, if it was a fighter aircraft, they might say that they're, the aircraft must be invisible to radar, it should have a very big payload of armament, and it should be able to travel very, very far distances. And a lot of times, you'd look at those requirements and they would be kind of contradictory. They wouldn't, it'd be like trying to get ten pounds of sugar into a five-pound bag. And they would just go ahead and do it, and they would have to mature technologies along the way. They'd have very much technology risk, and then that would lead to a lot of design risk as they tried to actually design the weapon system. And in the end, it would be very difficult to manufacture. [ Sarah Kaczmarek: ] So sounds like it can just be really hard to try to get everything that the warfighter might want right off the bat given just technology available or budget, and so at some point, you have to make trade-offs to decide, okay, this is what we can produce on the schedule and for this amount of money that can best meet the warfighter's needs? [ Mike Sullivan: ] Yes, that's right. And we have for years provided criteria from our best practices work that shows that you really should approach this in an incremental fashion. [ Sarah Kaczmarek: ] Well, that was definitely my next question, you know. Just to what extent they're using GAO's criteria they've been talking about or if they've made progress. [ Mike Sullivan: ] Congress actually took a lot of our criteria and established a lot of it in law with the Weapon System Acquisition Reform Act in 2009. And then the department's leadership actually embraced this criteria and those laws and wrote it into its own acquisition policies. So since then, we've been seeing a lot better business cases that start programs. Still not perfect. Still a lot of risk in the technologies, designs, and manufacturing processes. But they have pretty consistently trended to less cost growth from around 2010 to now. [ Sarah Kaczmarek: ] And finally, what would you say is the bottom line of this report? [ Mike Sullivan: ] I think the bottom line of the report is, as I said, they've gotten better, but they need to continue to focus on establishing a good business case at the outset of a program. [ Background Music ] [ Narrator: ] To learn more, visit GAO.gov and be sure to tune in to the next episode of GAO's Watchdog Report for more from the congressional watchdog, the U.S. Government Accountability Office.