Defense Acquisitions:

Key Decisions to Be Made on Future Combat System

GAO-07-376: Published: Mar 15, 2007. Publicly Released: Mar 15, 2007.

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The Future Combat System (FCS) is central to Army transformation efforts, comprising 14 integrated weapon systems and an advanced information network. In previous work, GAO found that the elements of a sound business case--firm requirements, mature technologies, a knowledge-based acquisition strategy, a realistic cost estimate, and sufficient funding--were not present. As a result, FCS is considered high risk and in need of special oversight and review. Congress has mandated that the Department of Defense (DOD) decide in early 2009 whether FCS should continue. GAO is required to review the program annually. In this report, GAO analyzes FCS development, including its requirements definition; status of critical technologies, software development, and complementary programs; soundness of its acquisition strategy related to design, production and spin-out of capabilities to current forces; and reasonableness of costs and sufficiency of funding.

The Army has been granted a lot of latitude to carry out a large program like FCS this far into development with relatively little demonstrated knowledge. Tangible progress has been made during the year in several areas, including requirements and technology. Such progress warrants recognition, but confidence that the program can deliver as promised depends on high levels of demonstrated knowledge, which are yet to come. Following the preliminary design review in 2009, there should be enough knowledge to demonstrate the soundness of the FCS business case. If significant doubts remain about the program's executability at that time, DOD will have to consider alternatives to proceeding with the program. Currently, GAO sees the FCS business case as follows. Requirements--Progress has been made in defining requirements and making some difficult trade-offs, but key assumptions about the performance of immature technologies and other technical risks remain to be proven. Technology--The Army has made progress in maturing technologies, but it will take several more years to reach full maturity. All key technologies should have been mature in 2003 when the program began. FCS software has doubled in size compared to original estimates and faces significant risks. The Army is attempting a disciplined approach to managing software development. Acquisition Strategy--The FCS acquisition strategy is compressed. Key testing to demonstrate FCS performance will not be completed, and maturity of design and production will not be demonstrated until after the production decision. Program Costs--New estimates place FCS costs significantly above the current estimate of $163.7 billion. The Army has recently proposed a plan to buy fewer systems and slow production rates. This recent program adjustment will affect program costs, but details are not yet available.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include a definition of acceptable technology maturity consistent with DOD policy for a program half way through system development and demonstration.

    Agency Affected: Department of Defense

    Status: Closed - Not Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. That included criteria for technology maturity but that criteria was the same as that expected of a new program rather than a program half way through system development and demonstration.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include determination which FCS technologies will be scored against those criteria.

    Agency Affected: Department of Defense

    Status: Closed - Not Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. However, the criteria did not include a determination of which FCS technologies that would be scored against the criteria.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include use of an independent assessment to score the FCS technologies.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review, including one on the maturity of critical technologies. In a subsequent discussion with DOD officials, they indicated that an independent review team would provide an independent assessment of the technologies.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include a definition of acceptable software maturity consistent with DOD policy for a program half way through system development and demonstration.

    Agency Affected: Department of Defense

    Status: Closed - Not Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. However, those criteria did not include anything specific on the maturity of FCS software.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include an independent assessment to score FCS software.

    Agency Affected: Department of Defense

    Status: Closed - Not Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. However, those criteria did not include reference to an independent assessment of FCS software.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include the likely performance and availability of key complementary systems.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. One of those called for the design, build, and test schedules of the FCS platforms and networks to be aligned and executable.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include an assessment of how likely the FCS system-of-systems--deemed reasonable from the progress in technology, software, and design--is to provide the capabilities the Army will need to perform its roles in joint force operations (Such an assessment should include sensitivity analyses in areas of the most uncertainty).

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In April 2009, the SECDEF made a decision to cancel the vehicle component of the FCS program. (The entire acquisition program was subsequently cancelled.) The SECDEF concluded that there were significant unanswered questions concerning the FCS vehicle design strategy and expressed concern that the vehicles did not reflect the lessons of counterinsurgency and close-quarters combat in Iraq and Afghanistan. He added that because the FCS vehicles were estimated to cost over $87 billion, he needed more confidence in the program strategy, requirements and maturity of the the technologies before proceeding further. In making this "no-go" decision, the SECDEF found that the FCS would not be able to provide the capabilities the Army will need and he did not have confidence in its acquisition strategy, requirements, and technology maturity.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include a definition of acceptable levels of technology, design, and production maturity to be demonstrated at the critical design review and the production decision.

    Agency Affected: Department of Defense

    Status: Closed - Not Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. However, that memorandum did not include any discussion of acceptable levels of technology, design, and production maturity to be demonstrated at critical design review and the production decision.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include an assessment of how well the FCS acquisition strategy and test plan will be able to demonstrate those levels of maturity.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In April 2009, the SECDEF made a decision to cancel the vehicle component of the FCS program. (The entire acquisition program was subsequently cancelled.) The SECDEF concluded that there were significant unanswered questions concerning the FCS vehicle design strategy and expressed concern that the vehicles did not reflect the lessons of counterinsurgency and close-quarters combat in Iraq and Afghanistan. He added that because the FCS vehicles were estimated to cost over $87 billion, he needed more confidence in the program strategy, requirements and maturity of the the technologies before proceeding further. In making this "no-go" decision, the SECDEF found that the FCS would not be able to provide the capabilities the Army will need and he did not have confidence in its acquisition strategy, requirements, and technology maturity.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include a determination of likely costs to develop, produce, and support the FCS that is informed by an independent cost estimate and supported by an acceptable confidence level.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. Although not referenced in the memorandum, a subsequent discussion with a key DOD official indicated that DOD was planning for an independent cost estimate to be conducted.

    Recommendation: The Secretary of Defense should establish criteria now that it will use to evaluate the FCS program as part of its go/no-go decision following its preliminary design review. At a minimum, these criteria should include a determination that the budget levels the Army is likely to receive will be sufficient to develop, produce, and support the FCS at expected levels of cost.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendations but did not specify the criteria it plans to use as it evaluates the progress made in the Future Combat System program at the congressionally mandated milestone review, now scheduled for 2009. After a Defense Acquisition Board review of the FCS in July 2008, an acquisition decision memorandum was issued with criteria for the milestone review. Although not referenced in the memorandum, a subsequent discussion with a key DOD official indicated that DOD was planning for an affordability assessment to be conducted.

    Recommendation: The Secretary of Defense should analyze alternative courses of action DOD can take to provide the Army with sufficient capabilities, should the FCS be judged as unlikely to deliver needed capabilities in reasonable time frames and within expected funding levels.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: In response to our draft report, the Department of Defense concurred with our recommendation, stating that the 2009 Defense Acquisition Board review would be informed by ongoing analyses of alternatives that include current force and network alternatives. However, it is not yet clear whether DOD will conduct the 2009 FCS milestone review in a formal sense. Nevertheless, the Secretary of Defense's decision to terminate manned ground vehicle development was at least a partial "no-go" decision on the current FCS program. Also, the Secretary's decision to proceed with several followon programs to FCS was, in effect, a consideration of alternatives to the current FCS program of record.

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