Sea Air Space

1. SeaAirSpace 5 April 2007 Dr. Delores Etter Assistant Secretary of the Navy Research Development and Acquisition

2. Outline • Environment • Mission and Goals • Shipbuilding Plan • Aircraft Recapitalization Strategy • Resetting the Force • Netcentric Environment • How do we get there? 2

3. National StrategyQDR Implications Irregular Warfare Terrorist Threats Near Peer Competitors Global Maritime Security 3 3

4. ASN (RDA) Mission To provide weapons, systems and platforms for the men and women of the Navy/Marine Corps that support their missions and give them a technological edge over our adversaries. 4

5. ASN (RDA) Goals • Expedite GWOT acquisition programs as much as possible without compromising safety. • Reduce volatility in current acquisition programs. • Develop an investment/transition strategy for Science and Technology (S&T) to ensure future technological edge. • Lead the Acquisition Enterprise component of the Naval Enterprise, in collaboration with OPNAV/HQMC and the fleet. 5

6. 30 Year Shipbuilding Plan • Submitted annually to congress with the budget • Focused on an executable and affordable long-range shipbuilding plan addressing: • Build rates • Fiscal constraints • Industrial base • Evolving requirements • Aligned with CNO Force Structure Assessment • Provides a clear requirement that helps to stabilize and clarify our procurement strategy

7. Naval Aviation Recapitalization • Recapitalizing entire aviation portfolio • Fixed Wing • Rotary Wing • Unmanned • Weapons Systems • Must also sustain the legacy force in support of operational commitments • Block upgrades/Spiral Development are being used where possible • Multiyear acquisition strategies are being used • Naval Aviation plan similar to the 30 Year Shipbuilding is in development

8. Resetting the Force • Approximately 30% of all Marine Corps ground equipment and 25% of active duty aviation squadrons are currently engaged overseas • High operational tempo and harsh environmental conditions are rapidly aging our equipment • Higher usage of equipment than predicted, with subsequent repair and replacements needed.

9. Netcentric Environment • Mission capabilities – International, Joint, Navy/USMC • Netcentric environment where C5ISR systems operate • Challenges –warfare systems and communications suites across platforms tend to be complex and unique • Enterprise approach is complex but we cannot afford unique standalone solutions • Open Architecture provides technical and business foundations that lead to standards, protocols and warfighting functionality

10. Organization • This procurement strategy is ambitious • Our business practices need to be based on • Accountability • Transparency • Trust • Our business processes need to be focused on delivering the required capabilities on time and within budget • Our organizational structure needs to be focused on the Program Executive Officers and the Program Managers who are responsible for delivering to the warfighter

11. PEO Acquisition Organizational Model CNO/CMC NAVY ACQUISITION EXECUTIVE DASNs DASNs DASNs Fleet/USMC PEO PEO PEO SYSCOM Commanders $$$ Cost Schedule Performance $$$ Cost Schedule Performance $$$ Cost Schedule Performance People WC WC WC Technical Authority Technical Competencies People Systems Engineering Competencies HCA/BSO Authority People Business Enablers Products Delivered to the Warfighter Current Readiness Future Readiness

12. SYSCOM Commanders Presentations • NAVSEA • NAVAIR • MARCORSYSCOM • SPAWAR

13. How do we get there? • Reduce Acquisition Volatility • Embrace Open Architecture • Leverage the Enterprise Model • Manage Risk

14. Acquisition Volatility • Program characteristics that affect acquisition program volatility: • Program complexity • Requirements fluctuation • Budget instability • Schedule demands • Contractor/PM optimism 14

15. Open Architecture Definition • Open Architecture – an architecture with well designed system and component interfaces that • Uses commercial standards as much as possible • Allows components to be decoupled and reused • Allows replacement components to be designed by third parties • Allows new capabilities to be added with minimal dependency on integrators 15

16. Navy Navy Enterprise Enterprise ExComm ExComm Fleet Fleet Collaboration Provider Provider Readiness Readiness Enterprise Enterprise Enterprise Enterprise Navy Enterprise Navy Enterprise Navy Enterprise

17. Risk Management • Understand risk in all phases of acquisition • Explore alternatives for isolating risk • Pursue commonality and modularity in future ship designs • Set achievable target costs • Establish realistic budgets • Stabilize requirements • Stabilize out-year acquisitions

18. Risk Spectrum Higher X Cost Plus Fixed Fee Cost Plus Incentive Fee Risk Assumed By the Government Cost Plus Award Fee Fixed Price Incentive (Firm Target) X Firm Fixed Price Lower Lower Higher Risk Assumed By the Industry 18

19. Closing • To be successful, we will need to rely on: • Partnership with Industry • Congressional support • Innovation in business and technology • Clear understanding of risk and risk mitigation techniques • Better execution by Navy and Industry

20. http://www.acquisition.navy.mil/ 20