Affordability Analysis: Organizing and Refining for Implementation

MORS Affordability Analysis Mini-Workshop

7 February 2017

Lockheed Martin’s Global Vision Center

2121 Crystal Drive, Arlington, VA 22202

Workshop Chairs: Robert Koury & Dr. Lisa Oakley-Bodgewic

 

This special meeting will focus on Department and Service affordability analysis and the interaction between the PPBES and acquisition players to include government, industry, academia, FFRDCs, and UARCs.  The first meeting (October 2012 – “Affordability Analysis: How Do We Do It?”) started affordability analysis discussions across government and industry, while the second (March 2014 – “Affordability Analysis:  Developing the Process”) created a framework for the first government / industry affordability analysis process.  This proposed meeting will start a dialog between government and industry to better understand affordability analysis at the Department and Service levels of DoD. This meeting is the precursor to a follow-on workshop to be held in the Fall of 2017 to explore in more depth the decisions affordability analysis can support, and how to develop the new required affordability caps and goals, as well as developing additional products for government and industry use. 

Since the Department of Defense (DoD) Leadership started acquisition reform with the Weapons System Acquisition Reform Act of 2009 and the Better Buying Power Memos, affordability and affordability analysis have been defined, included as policy, and made law:

·        In 2013 and 2014, affordability was defined in the updated JCIDS manual (CJCSI 3170.01I), the updated Guidance For Development and Implementation of Joint Concepts (CJCSI 3010.02d), and the Defense Acquisition Guidebook have defined affordability as the balance of cost, performance, risk and schedule. 

·        In January 2015, the updated Operation of the Defense Acquisition System (DoDI 5000.02) made affordability analysis policy by including it in a new enclosure.  The enclosure doesn’t define affordability analysis, but it does state it is different than cost analysis and describes both.

·        In November 2015, US Code Title 10, Chapter 139, Section 2366 a & b, made affordability analysis law by requiring the Service Secretary and Chief to certify the affordability analysis (i.e., cost, performance, risk, and schedule analysis) pre-Milestone A and pre-Milestone B. 

At the 84th MORS Symposium in June 2016, the MORS Affordability Analysis Community of Practice (AA CoP) Leadership presented the background and status of the AA CoP’s efforts, the affordability analysis Continuing Education Unit course, and an overview of the affordability analysis measurement framework.  As a result of these discussions, the MORS AA CoP, with support from the International Council on Systems Engineering (INCOSE), will start to work on these recommendations.  

The overall goal and objectives of this Mini- workshop include:

Identify and understand the different kinds of affordability decisions the department makes, and when those decisions occur in the lifecycle.  Determine through senior leader panel input how well the affordability decision making process is working.:  The goal of the third AA workshop is to determine how well the Department's Affordability Decision Making Process has been performing, and identify if there are any areas of affordability analysis that can be enhanced to improve affordability decision making. For example, we would seek to learn how the Affordability Goal at MDD is established. We should as a result of this goal provide DoD a better understanding of the two types of Affordability Analysis especially in the area of resource allocation above the system / program level.

Objective 1: Identify what is currently done at MILDEP and DoD levels

Objective 2: Articulate simply what should be done (normative)

Objective 3: Discuss why this is not done today (stumbling blocks)

Objective 4: Include both qualitative (political, international relations, likelihood of Congressional support/approval) and quantitative (objective/numerical analysis)

Objective 5: How should Industry assist government in the allocation process?

 The intent of this Mini-workshop is to capture the essential issues of Department and Service level Affordability Analysis in order to better define the work of the Fall 2017 workshop.

In addition to the MORS AA CoP, several MORS committees (CoP, Special Meeting, WG/CG, 85th Symposium, and Publications), all MORS CoPs (Affordability Analysis, Cost Analysis, M&S, National Security Risk Analysis, and Wargaming), and several annual symposium composite groups and working groups (CG E Acquisition, WG 23 Measures of Merit, WG 25 Analysis of Alternatives, WG 26 Cost Analysis, and WG 27 Decision Analysis) will be actively involved in the planning and execution of this special meeting. In addition, the planning committee will use the new MORS Affordability Analysis Community Page to post discussions and preliminary documents. A MORS membership is required to participate on the MORS AA Community Page. For information on joining MORS, please go to the MORS membership page.