A panel convened to examine the Defense Department’s acquisition processes has finalized its recommendations for overhauling the system after concluding a yearlong investigation that uncovered major problems in DOD procurement.

The Panel on Defense Acquisition Reform, established by the House Armed Services Committee in March 2009, said in its report that DOD’s mishandling of acquisitions and procurement fails to fulfill the military’s current mission needs and contributes to massive cost overruns. The final report largely tracks an interim document released March 11.

“The panel found that while the nature of defense acquisition has substantially changed, the defense acquisition process has not kept pace,” the report stated. “As a result, the Department’s formal acquisition policy has limited application to the majority of [its] acquisitions.”

To successfully reform its approach to acquiring weapons, services and other goods, the panel recommended “significant improvements” in managing the acquisition process, developing and incentivizing the highest quality workforce, improving financial management, and maximizing the industrial base.

Other recommendations included expanding the Office of Performance Management and Root Cause Analysis, which would track acquisition workforce performance based on predetermined benchmarks and “would promote real consequences,” according to the report.

The report included recommendations for new regulations for fair and transparent acquisition workforce hiring, assignments and performance appraisal. An extension of the Acquisition Workforce Demonstration Program, which aims to improve personnel management and policies and is set to expire in 2012, was urged as well.

The panel called on DOD to reform its financial management system, and said that without improvements here, true acquisition reform throughout the department may not be possible.

Also, the panel advised that DOD get more from the industrial base by improving contracting and competitive practices, pushing for better innovation and making use of small and mid-tier bases. Panelists also moved to repeal of a rule that allows agencies to withhold 3 percent of contract payments in anticipation of taxes owed to the Treasury Department.

— by Amber Corrin – Mar. 26, 2010 – Federal Computer Week