How Funding Instability Affects Army Programs

Abstract : At any given time, the U.S. Army is supporting many large and small weapon and equipment programs at every stage of the acquisition cycle, from concept development to disposition. And each year, senior-level decision makers make changes, both large and small, to the funding allocations for these individual programs for a host of reasons, such as shifts in priorities and requirements, the emergence of new opportunities, engineering-design modifications, and overall budget reductions. After the fact, the decisions to make these funding changes may turn out to have been mistakes; but they nevertheless reflect the best judgment of Army and Office of the Secretary of Defense leaders given the information available to them at the time. Regardless of the root causes or reasons for the changes, programs must absorb funding instability. Some Army officials are concerned that funding changes in Army weapons programs may occur without adequate attention being paid to how they will affect the management of those programs. Professional acquisition officials understand that funding instability affects program management in general, but those who are responsible for initiating the funding changes may not have this understanding. As a result, many funding decisions made during program reviews may result in unintended effects on a program's performance goals, cost, or schedule. This study sought empirical data from the experience of recent Army weapon system programs to clarify the effects of changes in their funding. Three different approaches were used: an exploratory quantitative analysis to define and measure funding instability and determine whether it was associated with program management problems (18 major Army programs were used for this analysis); an analysis of 3 case studies of individual programs and whether funding instability occurred (Javelin missile, FAAD C21, and CH-47F); and an analysis of funding instability in Army and Air Force programs since 2000.