An Initial Look at Technology and Institutions on Defense Industry Consolidation

Conventional wisdom holds that defense industry consolidation resulted from decreased defense spending. However, we maintain that understanding dynamic changes in key defense institutions helps provide a more complete explanation for observed consolidation. Specifically, we examine the interaction of evolving technology and changing institutions. Institutions reviewed include procurement policies, weapons requirements process and the procurement organizations. We take an initial look at the industry and highlight how these changes influenced transaction costs in the defense industry more fully explain the forces driving consolidation and provide greater insight to policy makers seeking to improve the performance of the defense industry. Further research is needed to build a robust institutional framework of the defense industry and the related government agencies to allow better policy prescriptions

Measuring Small Business Participation in Air Force Contracting: the Impact of Acquisition Reform

Congress has mandated the Air Force to reform and streamline its acquisition procedures while promoting participation by small business contractors. Reports on the federal government as a whole suggest that the acquisition reforms have had a negative effect on small business participation, with a declining number of small businesses receiving contract awards. A causal regression model is used to determine that the Air Force has actually increased the number of small businesses receiving contract awards over the past thirteen years and has maintained a steady stream of new small businesses into that group. Variables are tested to determine their effect on small business participation. Those tests reveal that number of contract awards and number of government-wide agency contract orders placed are useful for predictive purposes. The research also identifies two performance measurements for the Air Force small business office: total number of small business contractors and total number of new small business contractors

Performance Based Service Acquisition: A Quantitative Evaluation of Implementation Goals and Performance in the United States Air Force

In an attempt to maximize cost savings in the rapidly growing services sector, the DoD established a Performance Based Service Acquisition (PBSA) strategy that focuses on evaluating contractor performance based on their ability to meet desired outcomes rather than the means to which the outcomes are obtained. In April 2000, Dr. Gansler, then Under Secretary of Defense for Acquisition, Technology and Logistics, mandated that 50 percent of all eligible service acquisitions be awarded using PBSA methods by FY 2005. Since then very little research has been focused on USAF implementation of PBSA and the progress and attainment of the PBSA goals. Using multiple years of data this thesis seeks to evaluate and analyze the current and expected future states of PBSA implementation in the USAF. A combination of descriptive statistics, forecasting, contingency tables, and regression were used to analyze the data, draw conclusions, and make recommendations for PBSA implementation improvements. The results conclude that the USAF is not meeting interim PBSA goals and will most likely fall short of the FY 2005 PBSA goal. These results suggest that the goals may not have been reasonable and that the USAF has hit a natural plateau in PBSA use

Fine-Tuning Acquisition Reform\u27s Favorite Procurement Vehicle, the Indefinite Delivery Contract

This article provides an assessment of the effectiveness of the efforts to improve efficiency and commercialize government procurement, seven years after the passage of the Federal Acquisition Streamlining Act. The reforms that abolished inflexible rules and empowered a reduced acquisition workforce have been criticized as allowing agencies to obscure the transparency of traditionally rule-bound federal procurement, using sole source methods and bundling to limit competition. This Article asserts the problems associated with indefinite delivery contracting can be alleviated if more attention is devoted to accountability and enhancing contracting officer participation on the acquisition team

Small Business Contracting in America and Europe: A Comparison of Approaches

Working Paper (for Acquisition Research Program)The United States, the EU, and virtually all European nations undertook solemn commitments to promote small business access to public procurement and R&D programs as part of the 2000 OECD Bologna Charter on Small and Medium-sized Enterprises (SME) Policies. Notwithstanding these mutual commitments, the Europeans have continued challenging America''s Small Business Act of 1953 and the set-asides it authorizes as unfair barriers to trade. Thus far, the United States has resisted the criticism. To put the transatlantic debate over small business contracting into concrete terms, this article compares European and US approaches to small business procurement assistance. Subjects of comparison include approaches to defining a small business concern; creation of small business procurement assistance agencies; availability of suitable contracts through reductions in bundling and consolidation; small business goals and set-asides; contracting with small firms for economic sustainability and remedial purposes; measures to enhance transparency and availability of public procurement information for small firms; small business subcontracting policies; and use of public procurement to stimulate innovation. The article notes that Europe is competing with the United States for best SME assistance policies. It concludes that the main elements of European and US policies to support SME access to public procurement and R&D are very similar and are continuing to further converge. Accordingly, EU trade complaints are without substantial merit. Indeed, both sides in this debate have legitimate reasons to help their small contractors, both sides have weaknesses in their SME policies, and both sides can learn from each other''s best practices.Naval Postgraduate School Acquisition Research ProgramApproved for public release; distribution is unlimited

An Economic Analysis of the Truth in Negotiations Act (TINA)

Naval Postgraduate School Acquisition Research Progra