Army to probe the economics of modernization
- By Lauren C. Williams
- Jun 10, 2020
The Army is embarking on a yearlong economic study in hopes to better predict tech modernization needs.
Bruce Jette, the Army's acquisition chief, said at an AUSA virtual event June 8 the Army is working on a "holistic economic model" that extends beyond the current two-year budget planning cycle, which can impede modernization efforts.
The model, crafted in partnership with the deputy chief of staff and West Point, also aims to determine how long capabilities last, Jette said.
"One of the things we're trying to do is say what is the lifecycle of a particular capability, how does that fit together, how does that remain affordable in the long term," he said.
Jette said the budget planning process, which starts two years before execution, limits the service's outlook to a maximum of six years in the future.
"We wrestle with these two-year bites," he said, because that time frame often means modernization needs are misaligned especially when "huge systems [are] coming along and they're coming outside those windows."
Jette said the economic study, which would coincide with the Army's zero-budgeting night court process, should be able to give the service more insight into when technology modernization can be delivered and how the capability (and its cost) affects readiness. It all comes down to one question, he said: "Is something ready and can I afford to insert it?"
Defense officials often cite rigid budget cycles as a major hindrance to technological advances, an increasing concern as future defense budgets are expected to remain flat as Congress begins marking up the 2021 defense authorization bill this month.
Gen. John Murray, commander of Army Futures Command, told reporters he expects the defense budget to take a hit, but said that it will trigger reevaluating the equipping portfolio and production schedules.
"If defense budgets do in fact go down or even flat line, we're going to have to look holistically at the entire equipping portfolio, continue to make some decisions within everything else where we can, and then potentially look at production schedules," Murray said at a Defense Writers Group event May 27.
"It's tight right now in terms of the budget we got for modernization, and we have to modernize now."
Murray said that due to the pandemic, any delays to modernization could mean those priorities are put off longer than intended.
"If we don't modernize now with everything we have going on, the chances are that we're not going to modernize for a long time," he said.
This article first appeared on FCW, a Defense Systems partner site.
Lauren C. Williams is a staff writer at FCW covering defense and cybersecurity.
Prior to joining FCW, Williams was the tech reporter for ThinkProgress, where she covered everything from internet culture to national security issues. In past positions, Williams covered health care, politics and crime for various publications, including The Seattle Times.
Williams graduated with a master's in journalism from the University of Maryland, College Park and a bachelor's in dietetics from the University of Delaware. She can be contacted at [email protected], or follow her on Twitter @lalaurenista.
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