Pentagon Acquisition Chief: Use Nonprofit Labs for Research and Development

WASHINGTON — Pentagon acquisition executive Ashton Carter is urging U.S. Department of Defense (DoD) weapon buyers across the services to make better use of federally funded research institutions that provide critically needed expertise, particularly during a time of budgetary belt-tightening.

The better use of these federally funded research and development centers (FFRDCs) could also help the Pentagon attract and retain young engineers, Carter, undersecretary of defense for acquisition, technology and logistics, said in a May 2 memo to service secretaries and other top DoD officials. He also wrote that FFRDCs can help the Pentagon maintain core competencies such as analysis, engineering, acquisition support, and research and development.

“This isn’t the 1950s or 1960s, when most of the technical talent of the country grew up in defense and wanted to stay in defense,” Carter said in a May 6 interview. “We need to be attractive and make sure that we can attract and retain really good people taking an interest in national security problems.”

These FFRDCs can “sit on the government’s side of the table” and “bring the technical expertise that we have difficulty attracting and retaining,” he said.

But Stan Soloway, who leads the Professional Services Council industry group, said the new policy might unduly expand FFRDCs’ purview.

“In recent years, FFRDCs have been expanding their business base beyond the unique and narrow areas for which they have been created, including selling their services across government in areas as commercial as performance measurement and management; information technology and IT architecture; and areas of systems and other engineering, which are entirely appropriate for private sector performance,” Soloway wrote in a May 6 statement. “And it is not clear that this new policy will address that troubling trend. Further, the declaration that FFRDCs are, de facto, free of conflicts of interest is simply not accurate and is worthy of further analysis by DoD.”

The institutions are sponsored by a particular service or agency for performing, analyzing, integrating, supporting and/or managing basic or applied research and development. The institutions receive more than 70 percent of their funding from the federal government.

More importantly, they can provide independent guidance across the core competencies and are free from conflict of interest restrictions.

“Therefore, they can do things for us that for-profit contractors can’t do … because they can access proprietary information from multiple vendors, just like our government employees do,” Carter said. “That’s incredibly valuable.”

Carter said the Pentagon has paid too little attention to these institutions in recent years.

“The strategic intent of highlighting [FFRDCs] at this time is to make sure that everybody in our acquisition system understands that this is an important resource, and gives them some guidance on how to use and sustain these organizations over time,” he said.

The FFRDCs have not been used strategically enough in “reinforcing and assisting in the core missions that only they can accomplish,” Carter said. Some younger acquisition officials look at these research-and-development institutions as contractors.

“I’m essentially telling our sponsors: ‘Don’t use these people as ordinary contractors,’” Carter said. “They’re not supposed to be competing with for-profit contractors for the same work.”

Carter’s recently issued instruction intends to get better use out of FFRDCs. Acquisition support FFRDCs — specifically MITRE and Aerospace Corp. — “are very important as we try to reverse the trend that started in the 1990s of relying on those contractors who perform our work to do all the systems engineering,” Carter said.

“That didn’t turn out to be a very good idea,” he said. “As a consequence of that, you have some technical fields in which the government work force is very, very thin.”

The Pentagon needs systems engineering help in a number of areas, including the Army Ground Combat Vehicle, the new Air Force bomber and the Navy Ohio-class submarine replacement. The institutions also can help DoD in the cyber security field.

The FFRDCs can help DoD in developing requirements and meeting affordability and other objectives with these initiatives, according to Carter. The better use of FFRDCs will help the Pentagon get more affordable weapons at a time when defense budgets are tightening.

Still, for-profit acquisition support and systems engineering help is also “a very important dimension of what we do, and something we also want to strengthen,” Carter said.

Jacques Gansler, a Pentagon acquisition executive in the administration of President Bill Clinton, said, “There is a function they can serve, helping the government as the third party doing systems engineering work where the government doesn’t have that internal capability.”

The emphasis in Carter’s memo is part of an update to the DoD’s FFRDC Management Plan, the first since 2003. In addition to the emphasis on FFRDCs, the finalized plan will address FFRDC nondisclosure agreements and the recognition and handling of FFRDC employees deploying oversees.