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Appendix B
OSTP QUESTIONS AND DOD ANSWERS

Summer 1996

COMMON QUESTIONS:

1. What steps have been taken to reduce internal management orders, regulations, and redundant oversight? Please provide baseline and performance measures that demonstrate the affect of these changes on scientists, programs, laboratories, and the agency.

    The Department is continually reducing regulatory oversight. Three examples follow. A complete revision of DoD Directive 3201.1, "Management of DoD Research and Development Laboratories" is in process. The revised Directive is intended to encompass Directives 3201.3, "DoD Research and Development Laboratories" and 3202.1, "Use of DoD Research Facilities by Academic Investigators", so that these Directives can be superseded/canceled with the intent of reducing redundant regulations within the Department. Further, 10 U. S. C. 2539B will be implemented by a (draft) instruction "Authority to Sell" being rewritten for implementation in the near future; once this rewriting is completed, the Department will be in a position to more effectively and efficiently enter into contracts with private concerns and other government entities for fee-access to Department test facilities. Additionally, the Federal Acquisition Streamlining Act of 1994 has implemented cost saving changes in the Department's acquisition efforts. Another important streamlining initiative is the "Waiver Authority for Reinvention Laboratories and Centers" (attached). In this authority, SECDEF delegated to the Secretaries of the Military Departments and Directors of the Defense Agencies the authority to waive any requirement contained in a Department of Defense Directive, Instruction, or Publication for Service or Agency approved reinvention laboratories and centers.

    The Department is approximately half-way in developing its Vision 21 plan Laboratories and Test-and-Evaluation Centers of the Department of Defense. The initial Vision 21 report to the President and Congress, dated April 30, 1996, outlines an approach to reduce, restructure and revitalize the Department's laboratory and T&E infrastructure, commensurate with continuing manpower and workload reductions, by 2005. Prior actions, most notably Project Reliance and the Defense Base Closure and Realignment Acts of 1988 and 1990, have resulted in significant changes within the Department. Project Reliance created a more condensed, corporate and cooperative approach to laboratory and T&E management by establishing areas of RDT&E capability and "Lead" military departments for Lab/T&E focus area. The 1988, 1991, 1993 and 1995 rounds of base closures have now entered the implementation phase and significant reductions in the Department's Lab and T&E infrastructure have begun. Specifically, 62 Lab/T&E sites will have been closed or realigned as a result of the base closure process. Vision 21 is the intended follow-on to the Project Reliance and base closure efforts. Furthermore, the DoD is currently implementing the Government Performance and Results Act (GPRA) within the laboratory structure. Working with the OSD Comptroller, as the GPRA lead for the Department, the Lab/T&E community is developing new goals and performance measures to be complete by September 1997.

2. What steps have been taken to clarify and focus laboratory missions and assignments? Has redundancy been eliminated and to what degree has the laboratory system been restructured?

    The most dramatic reductions in laboratory missions and redundancy occurred during the four rounds of base closures. Simultaneously, along with the downsizing and restructuring associated with BRAC, a reduction in program overlap is occurring. Numerous management initiatives are also ongoing as the Services find new, more efficient ways to adapt to a smaller infrastructure. So far, only 20% of the BRAC recommendations have been implemented with 100% completion due by 2001. Project Reliance has evolved into a DDR&E lead on-going initiative which, among many other things, is a set of formal agreements in the Military Departments for joint planning and collocated in-house work. Reliance is a team effort involving OSD, the Joint Staff, Military Services and Defense Agencies. This participative approach to overseeing the DoD RDT&E program greatly improves the focus, quality, timeliness and customer satisfaction of the DoD RDT&E investment. Programs like Project Reliance and the base closure process have improved the focus of the laboratory missions and reduced redundancy. Restructuring is, in fact, one of the three pillars of Vision 21.

    Additionally, the ongoing Laboratory Quality Improvement Program (LQIP) established in 1993 focuses on improving efficiency by streamlining the laboratories' business practices and granting the heads of the laboratories increased authority to operate their organizations in a business-like fashion.

3. What has been done to streamline and improve management practices, both at the agency and in the laboratories? What impact have these actions had on efficiency and effectiveness of the laboratory system? Please include information about personnel reductions, both at the agency and at the laboratories. Also, provide a list of redundant and/or lower priority programs, projects, and activities that have been eliminated or significantly reduced and the savings (in FTEs and dollars) from each reduction or elimination.

    The major efforts to streamline and improve management practices are Project Reliance, the Laboratory Quality Improvement Program (LQIP) and the Base Realignment and Closure process (BRAC). All of these programs are ongoing and have produced a 29% reduction in RDT&E personnel (military and civilian) from 121,000 to 86,000 during the period FY 92 to

    FY 01. Defense-wide, RDT&E funding has declined $9.7B (FY 97$) since FY 85. To accommodate this decline and still maintain a strong RDT&E program, numerous innovations have taken place. Some examples are: Services teaming with ARPA and other government agencies to plan, prepare and evaluate rapid prototyping programs saving approximately $100M, Air Force using the BMDO funded TOPAZ International Program which performs non-nuclear electrical testing on space reactors avoiding additional costs of $15M, a joint program for a chrome coating technology may save the Air Force $14M per year through elimination of bearing replacements and the Services are collaborating in research and development for phased array antenna multichip assemblies and interconnect technology avoiding costs of $2M per year.

4. What steps have been taken to coordinate and integrate laboratory resources and facilities within the agency and with other agencies?

    The Director, Defense Research and Engineering (DDR&E) has continually enhanced the strategic planning process for DoD S&T. The foundation of this process is the Defense S&T Strategy which presents the DoD S&T vision, strategy, plan, and objectives for the planners, programmers, and performers of Defense S&T. The Strategy and associated plans are made available to defense contractors and our allies with the goal of better focusing our collective efforts on superior joint warfare capabilities and improving interoperability. The Department's future direction lies in the Vision 21 plan. The preparation of the laboratory portion of the Vision 21 Plan is being led by the DDR&E. The T&E portion of the Plan is being prepared under the leadership of the Service Vice-Chiefs in their roles as the Board of Directors for the T&E Executive Agent (hereafter called the BoD), augmented by the Director, Test, Systems Engineering and Evaluation, representing the defense agencies. An Overarching Integrated Product Team (O-IPT), chaired by the Under Secretary of Defense (Acquisition and Technology), has been formed. This O-IPT will include the BoD; the Service Acquisition Executives (SAEs); the DDR&E; the Director, Operational Test and Evaluation (DOT&E); and the Director, Test Systems Engineering and Evaluation (DTSE&E). The O-IPT is providing the policies and framework for the conduct of the laboratory and T&E center studies and is the focal point for bringing the e two initial plans together and for producing a final single plan. Streamlining efforts with other agencies include the NASA/DoD Study, Federal Laboratory Reform and Section 265 of the FY 96 National Defense Authorization Act. All of these initiatives direct various efforts at eliminating redundancy, improving efficiency, effectiveness and productivity and maintaining U.S. preeminence in RDT&E.

SPECIFIC QUESTIONS FOR DoD - July 11, 1996

1. What capability overlays has your effort uncovered?
-- within each Service/OSD?
-- cross-Service integration (among Services)?
-- with other agencies?

    The Department is moving to a more fully integrated cross-service warfighting capability. Thus, a given Service will act more to support the others than to maintain an ability to fight a conflict alone. To this end, some redundancy in the R&D arena, and testing capabilities, has been identified, and is being eliminated. For example, the Army has been given a lead role in chemical and biological warfare defense research and technology, with direct cooperation from the Navy and Air Force. Further, the Air Force has been given lead service status on fuels research, with a mandate to consider and address Army and Navy fuel technology concerns above and beyond those addressed in the Reliance Program. Of course, the various Services have consolidated internal R&D and testing capabilities to support this new cross-service focus. Additionally, the Department is cooperating with other Federal agencies such as NASA to eliminate overlap in such areas as rocket propulsion test facilities, and wind tunnel testing capabilities so that fewer and more sophisticated test facilities can be developed.

2. What are the essential technical capabilities DoD needs to maintain in its laboratories?

    A number of major initiatives have been undertaken that will result in significant reductions and the restructuring of DoD laboratory and T&E center personnel and infrastructure. The Vision 21 Plan will be based on analyses of several internal and external DoD laboratory and T&E center science and technology, infrastructure, and programmatic studies which will document essential technical capabilities the Department must sustain in order to maintain U.S. defense technological superiority well into the 21st century. Warfighting is a unique operational environment without parallel in the private sector. The Department recognizes that warfighting to a victorious conclusion relies on myriad unusual technologies, technologies which in many cases may have limited, or no, non-military application, and are thus NOT available off-the-shelf. The Department can, and often successfully does, with the advice and guidance of its in-house technology laboratories, procure/adapt commercial technologies for routine operations and even low-level hot conflicts. However, actual warfighting draws on an unusually broad technology base, and the Service laboratories are in part structured to provide and develop unique technologies which provide US Forces with a qualitative edge in the fog of battle. Specifically, for example, the Military Departments support in-house research and development in chemical and biological warfare defense, ultra-high energy explosives, at-sea refueling and replenishment of naval platforms, maintenance of secure data processing in hostile electronic environments, ultra-high power laser systems, and the testing of Service unique materials (e.g. composite armor) and platforms (e.g. the V-22 Osprey, and advanced jet propulsion systems). These efforts, and many others, because of their military uniqueness, are supported in-house by the Services. A more complete compilation of essential (non-classified) military technologies associated with, or at a minimum evaluated by, the Service laboratories, is discussed in the DoD Defense Technology Area Plan document of May 1996.

3. How has your review been coordinated with the National Policy Review?

    The Vision 21 Plan will be submitted to the President and the Congress in July 1998. Formal coordination will begin in early 1998.

4. What internal management instructions, regulations, and redundant oversight that impede laboratory performance have you identified, per PDD/NSTC-5?

    Consistent with Executive Order 12861, "Elimination of One Half of Executive Brach Internal Regulations" the Department has proceeded with a review of existing DoD issuances with the intent of consolidating such directives which prove redundant. To this end, for example, the Department is revising and expanding DoD Directive 3201.1 "Management of DoD Research and Development Laboratories" to encompass redundant instructions included in related directives addressing laboratory management 3201.3 and 3202.1. The net result of three years of such effort is that the number of DoD acquisition regulations has been reduced from 766 to 505, a reduction of over 35%. Further, page count for these reductions has been from some 155,000 pages to some 84,000 pages, a nearly 50% reduction.

    The DoD S&T Reinvention Laboratory Initiative, including the Laboratory Quality Improvement Program (LQIP), has started and is being implemented to identify and overcome personnel, facility, contracting, information infrastructure, and regulatory impediments to effective, efficient laboratory management. For example, LQIP will enable the laboratories to hire, pay, and promote technology leaders in support of Military Department missions in a time efficient manner, using policies tested by the Navy at China Lake, CA. Further, DoD is actively implementing changes in information processing which will improve communications within the Department.

5. How do you define a laboratory?

    A laboratory is defined as any DoD activity that performs one or more of the following functions: science and technology, engineering development, systems engineering, and engineering support of deployed materiel and its modernization. Each military department and DoD agency is organized differently for such functions, but the term embraces laboratories, research institutes, and research, development, engineering and technical activities.

6. Have you compiled a list of all your laboratories, along with a relevant database of personnel, resources, activities, and mission?

    These data are currently being updated and compiled as part of the Vision 21 Study and will be available for review in July 1998. The last data collection exercise occurred in preparation for BRAC 95 and therefore did not include BRAC 95 results. However, some personnel, resource activity and mission information is currently available in the DoD RDT&E In-House Activities Reports up to FY '94. The FY 93 and 94 reports are available under the documents section of the Laboratory Management and Technology Transition homepage on the Internet (http://www.dtic.mil/labman/). Furthermore, we are currently compiling data for the FY 95 report, which will be available shortly.

7. How do the missions of your various laboratories stack up against the mission statements of the Services they work for?

    The missions of the laboratories are specifically designed to support the product and warfare areas of each Service to which they are organizationally attached. The Service laboratories have been structured to support technology innovation in areas of specific interest to the host Service. For example, Army laboratories are concerned specifically with human factors engineering, and Army-unique materials research, Navy labs perform basic and applied research in materials and energetic substances for Naval applications, while the Air Force labs focus on propulsion and airfoil technology. All Service laboratories, however, provide Service specific technical guidance in ALL technology areas of interest to their host Services.

8. Has DoD examined the effectiveness of in-house versus outsourced research? In-house versus outsourced management of programs or contracts?

    A study was conducted by the Institute for Defense Analyses (IDA) in August, 1994, and documented in their report entitled "Laboratory Infrastructure Capabilities Study." This study brought together parallel panels of experts from inside and outside the government to provide perspectives on the nation's capabilities to perform DoD's science, technology, and engineering functions through industry and academia in collaboration with the laboratories, and potential shifting of work from the laboratories to "out-source" performers. From 1991 to 1994, service laboratories consistently spent more than 50% of their total funding on out-of-house contracts. During that time, they increased their funding of out-of-house contracts by 47% from $8.4 billion to $12.3 billion. The study's main conclusion indicated that funding for DoD's science, technology, and engineering functions is already sufficiently out-sourced. However, it must be noted that the Department CANNOT necessarily readily, or cost effectively procure needed research and/or testing expertise for mission critical technologies outside the in-house facilities. As an example of this situation note that private industry has little- to no-interest in studying the long-term storage of hydrocarbon fuels, as commercial utilization of such fuels is so rapid that there are no "old" fuels in the private sector. In contrast, the Services stockpile fuels for years at a time, and fuel degradation in such a time frame is of critical concern to mission support.

9. What changes in mission and management have been made at your labs since the end of the Cold War?

    The Department has initiated a new, and broad-based management/planning approach to RDT&E in light of changes in the Department's mission at the end of the Cold War. The three major Plans DoD uses to insure coordination and cross-flow of all programs and initiatives among all Science and Technology functions are the Basic Research Plan, the Joint Warfighting Science and Technology Plan and the Defense Technology Area Plan. The Basic Research Plan presents the DoD objectives and investment strategy for DoD sponsored research performed by universities, industry and Service laboratories. The Basic Research Plan presents the planned investment in 12 broad research areas and 10 strategic research objectives for enabling the development of breakthrough technologies. The Joint Warfighting Science and Technology Plan takes a joint perspective horizontally across the Services and Defense Agencies to ensure support for the requisite technology and advanced concepts for superior joint and coalition warfighting. The Defense Technology Area Plan presents the DoD investment strategy for technologies critical to DoD acquisition plans and the Joint Warfighting Science and Technology Plan and charts the total DoD investment for a given technology. The anticipated return on investment is identified through approximately 200 Defense Technology Objectives in ten broad technology areas.

10. As a case study, how is DoD coordinating research on information warfare/assurance?

    Information Warfare/assurance is specifically addressed in the Defense Technology Area Plan for Information Systems and Technology. Our Information Warfare Defense Technology Objectives are Context-Based Information Distribution, Assured Communications, Network Management, Defensive Information Warfare, Survivable Information Systems, Navigation Warfare, Highpower Microwave Technology, Modern Network Command and Control Warfare Technology, Digital Communications Electronic Attack and Information Warfare Planning Tool ACTD.

11. How has the ratio of direct and indirect workers at labs changed as personnel levels have changed; overall; by lab category; by major lab? What efforts has DoD taken to date to downsize the RDT&E infrastructure?

    The 1988, 1991, 1993 and 1995 rounds of base closures have now entered the implementation phase and significant reductions in the Department's Lab and T&E infrastructure have begun. Specifically, 62 Lab/T&E sites will have been closed or realigned as a result of the base closure process. Additionally, these closures and other programmatic consolidations have produced a 29% reduction in RDT&E personnel (military and civilian) from 121,000 to 86,000 during the period FY 92 to FY 01. These changes represent specific efforts to downsize the existing RDT&E infrastructure. The ratio of direct and indirect workers at labs has changed as personnel levels have dropped. As a specific example of the changes in personnel levels in the laboratory community, note that the Air Force's Wright Laboratory (Dayton, OH) had 1800 scientists and engineers (S&E) and 500 support personnel as of September 1992, yet had 1500 S&E and 400 support personnel as of July 1996. These data represent a 17% decrease in technical staff, and a 20% reduction in support staff. The Department of the Army reports that, as an example, at the Corps of Engineers Waterways Experiment Station (Vicksburg, MS) in 1993 47% of its staff was S&E personnel, in 1996 50% was, and in 1993 there were some 1550 total S&E and support staff, while in 1996 the total staff was 1370.

12. How will downsizing and restructuring the DoD laboratory system affect our ability to meet our defense mission?

    The Vision 21 Plan will serve as the blueprint by outlining an ongoing process that will enable DoD laboratories and T&E centers to meet the continuously evolving requirements of the warfighter, both now and in the future, despite a changing threat environment and reduced budgets into the 21st century. Vision 21 rests on three integrating pillars: Reduction (physically reducing the size of the laboratory infrastructure), Restructuring (including intra-Service and cross-Service), and Revitalization to fully modernize facilities and technological capabilities. It will take careful planning to ensure the DoD laboratory system is not reduced so much that end-term technology development degrades beyond our capability to support operational, readiness and training requirements.

13. What type of enabling legislation do you foresee will be required to implement DoD lab consolidation plans when they are ready? How critical is this legislation, and what would happen if it could not be passed?

    The DoD will require legislation to implement the final, approved Vision 21 Plan. A comprehensive package of legislative proposals (e.g., waivers to 10USC2687, Davis-Bacon Act, N.E.P.A., etc.) with justification will be developed and submitted to Congress by January 1997, in accordance with the required legislative clearance framework established by OMB Circular A-19. Without the legislation, the results of the Vision 21 Plan cannot be implemented effectively and efficiently, and at the lowest cost to the taxpayer.

14. What steps are you taking to ensure Service coordination in your lab review?

    The Vision 21 process is an inclusive effort bringing together all interested parties in the lab and T&E arena. Specifically, the Services are represented at every level in every step of the process. Service coordination will take place incrementally as well as for the final product. The Vision 21 Internal Control Plan provides the necessary structure to insure proper coordination.

15. How has the inclusion of test and evaluation centers in DoD's laboratory review affected the conduct of the review?

    The Vision 21 planning process is being developed through both laboratory working level Integrated Product Team (IPT) and the Test and Evaluation working level IPT. An Integrating IPT that is co-chaired by both Director Defense Research & Engineering and Director, Test Systems Engineering and Evaluation is responsible for coordinating/integrating both these essentially parallel efforts. An Overarching IPT that is chaired by USD (A&T) will make final recommendations to SECDEF with regards to the Vision 21 effort, based on input from the Integrating IPT.

    T&E centers are an integral component to efficient and effective testing and evaluation of laboratory output. A T&E center, within this context, is defined as any facility or capability used for purposes of data collection for T&E; that is, a set of DoD-owned or controlled property (air, land, sea or space) or any collection of equipment, platforms, automated data processing equipment or instrumentation that conducts a T&E operation; and that provides a deliverable T&E product.

ADDITIONAL QUESTIONS FROM AUGUST 5, 1996

1. All three agencies are citing reductions in force both in program administration and at the laboratories. Have the Agencies identified reductions in programs?

    Streamlining programs such as Project Reliance, the Laboratory Quality Improvement Program (LQIP) and the base closure process as well as smaller Service unique initiatives have resulted in personnel reductions of 29% between FY 92 and FY 01.

    RDT&EFY '92 (act.)FY '95 (act.) FY '01 (pro.)Chng. FY '92-'01
    Milpers(000) 20.6 17.7 15.6
    Civpers(000)100.8 90.3 70.1
    Total121.4108.0 85.7-35.7 (-29%)

2. A perspective on Agency funding of its Laboratories is important. A table of the Agencies funding of the labs FY 85-'95 with any projections they care to make is essential to the writing of our report.

DoD RDT&E (FY '97 $B)

FY 85 FY 86 FY 87 FY 88 FY 89 FY 90
43.0 45.9 47.5 47.2 45.8 42.3
FY 91 FY 92 FY 93 FY 94 FY 95 FY 96
39.6 42.4 41.1 36.9 36.0 33.3

DoD S&T (FY 97 $B)

FY 85 FY 86 FY 87 FY 88 FY 89 FY 90
6.3 6.3 7.5 7.7 8.4 7.4
FY 91 FY 92 FY 93 FY 94 FY 95 FY 96
8.4 8.0 9.5 8.3 8.3 7.7


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Appendix A

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Appendix C

Appendix D