At the time, Little had wondered how he could procure such a low cost weapon when cost estimates based on historical precedents placed the price at $68,000 (p. 2). In April 1994, the Joint System Program Office selected McDonnell Douglas in St. Louis, and Lockheed Martin in Orlando from five original competitors to design the tail kits and to submit proposals to win the development and follow-on production contracts, worth about $2 billion (Ingols & Brem, p. 1). When informed by Little that the price for the individual JDAM units might be higher than expected, General McPeak flatly informed him that, “By god, if its one cent over, I dont want it” (quoted in Ingols & Brem at p. 9).
What are your recommendations for action?
There were some valuable lessons learned in the JDAM initiative that could be used to develop some useful best practices for similarly situated projects in the future. It is recommended, though, that future projects avoid the mandatory assignment of any specific civilian personnel from a given defense contractor to a project development team because this individuals expertise and contributions may be needed more elsewhere in the organization; such selections should be at the sole discretion of the defense contractor involved depending on the needs of the company at any given point in time.
What are the important events?
Establishment of the JDAM project in 1991
The Beginning of JDAM — 1992 to 1994.
Epiphany by Little that commercial-like processes and products could replace more expensive government procedures and products to reduce cost and improve efficiency of supply chain management and streamlining the RFP process could contribute to cost savings in major ways.
Engineering and manufacturing development phase I: April 1994 through July 1995.
Engineering and manufacturing development phase II: Fiscal year 1996 through mid-Fiscal Year 2000.
Production: 87,496 units by Fiscal Year 2002.
How much time elapsed during the events described?
The origins of the JDAM initiative began in 1991 and were concluded with the award of the contract to McDonnell Douglas with the latest date identified by the case study authors being September 1995 in the case study itself with later years being described in the studys several appendixes.
Who are the players?
General Merrill a. McPeak, Air Force Chief of Staff
Mr. John Deutch, Under Secretary of Defense
General Joseph Ralston, Air Force Deputy for Tactical Programs
Mike Tenzycki, product test and integration engineer; member of the McDonnell Douglas team.
Oscar Soler, Littles successor on the JDAM program
Office of the Secretary of Defense (OSD)
Diane Wright, the OSD action officer for JDAM
Dr. George R. Schneiter, Director of Strategic and Tactical Systems and chair of JDAMs Overarching IPT
Colonel Joe Shearer, government advocate assigned to help McDonnell Douglas win the contract.
John Capellupo, head of McDonnell Douglas.
Charles H. Davis III, supplier manager with Missiles Systems Division and subsequently McDonnell Douglas.
Dave Swain, change sponsor at McDonnell Douglas.
Carl Miller, McDonnell Douglas team member.
Richard Heerdt, supplier manager for McDonnell Douglass guidance and control unit.
Mary Shutt, program manager with Loral.
What are their backgrounds?
The personnel identified in the case study as being part of the civilian component of the development teams at McDonnell Douglas and Lockheed Martin generally had extensive request for proposal preparation experience as well as longstanding relationships with their governmental counterparts. In addition, many had extensive experience in defense-related initiatives in the past that had some concomitant commercial applications but JDAM represented the first military-only application for both teams. As to the military personnel, although all of their respective backgrounds are not discussed in detail, the case study makes it clear that the top brass involved were veterans of the acquisition process and possessed the experience and authority to make the decisions needed to move the JDAM initiative along and delegate authority when necessary.
What are their motivations?
While there were some clearly laudable military goals associated with the JDAM initiative, these appeared to take a back seat to the enormous economic consequences associated with the projects development and implementation in the field. There were also some powerful political motivations involved, with the powers-that-be in Washington insisting that cost be the fundamental guiding factor in the JDAMs development rather than the previous emphasis on how fast a contractor could respond. Indeed, promoting an efficient acquisition and development process for appearance sake was one of the more important motivations for the vast majority of the players involved.
For instance, the authors report, “The governments willingness to enter into a stable long-term contract motivated each company to work as a team member and to build trust” (Ingols & Brem, p. 32). Finally, the defense contractors were motivated by.”.. Littles creative approach to the JDAM acquisition and the strong motivation supplied by the competition and incentive program [which] inspired McDonnell Douglas to come up with innovative ways to engage their supplier chain in the affordability initiative” (Ingols & Brem, p. 30).
What are their attitudes towards other characters and events?
Notwithstanding the authors emphasis that the JDAM represented a timely initiative for identifying improved defense acquisition procedures based on its uniquely military attributes and applications as well as the new non-adversarial approach represented by the RFP developmental process, there were clear overtones of competition among the surviving bidders and national interests appeared to take a backseat to the need to satisfy the mandates establish by Congress and the Pentagon to achieve more cost-effective ways of doing business as usual.
What does the organization look like and what are the reporting relationships?
The case study makes it clear that the bureaucracies involved in the JDAM initiative are extensive and convoluted, with the Congress representing the top of the hierarchy, followed by the Pentagon brass and the higher-ups at McDonnell Douglas and Lockheed Martin.
Who has influence over whom?
The influence inherent in the respective bureaucratic hierarchies of the respective defense contractors was clearly secondary to the law of the land promulgated by Congress: “The programs were provided legislative authority to implement the provisions before they were published in regulations, and authority to use the commercial item exemptions for non-commercial items. They were also provided expedited deviation authority from the FAR/DFARS and the DoD 5000 series regulations. This would allow JDAM to issue a commercial-like contract and authority to streamline the milestone review process and reporting procedures through expedited waivers” (Ingols & Brem, p. 5). In addition, as the Air Force program manager for Joint Direct Attack Munitions, Little had an enormous amount of influence over the competing defense contractor teams, but even here, he used an innovative approach that broke with traditional governmental acquisition processes. According to the case study authors, a major difference in how Little administered the JDAM initiative was the manner in which feedback was provided to the contractors and sub-contractors: “Usually, the government gives the competing contractors little or no response to proposals until after the formal source selection process is concluded. It is common that losing bidders will protest the award, costing the government time and money, and driving the need for over-documentation” (Ingols & Brem, p. 15). By contrast, the approach used in the JDAM initiative used a “report card” approach over the course of the 18-month selection period. In this regard, Ingols and Brem report, “The source selection team graded the companies on performance criteria and how well they performed to their original plan. The meetings were open discussions and included color-coded grades. The report cards were binding — how the companies fared during the reviews directly factored into the final decision” (p. 15). Moreover, in many cases, it would appear that influence was reciprocal and fluid. In this regard, McDonnell Douglass supplier manager, Charles Davis, emphasized: “JDAM was a phenomenon — it truly was defined as a product team. Functional roles were blurred and we rarely saw functionality. We didnt throw things over the wall, we did a lot of working around a table to get the best product we could” (quoted in Ingols & Brem at p. 23).
What are the cultural overtones?
The primary issue to emerge from the case study was the difficulties associated with implementing change in a vast bureaucracy and what steps are needed to ensure that any progress made in effecting change was not eroded by complacency and sabotage by the various players involved.
Not surprisingly, when they were allowed to use commercially available products in their JDAM developmental efforts, the teams determined that these typically less expensive than their government-mandated counterparts. The Pentagons specifications for $500 hammers represents an iconic example of this potential for cost savings by allowing defense contractors to use their best discretion in selecting which items will satisfy the program requirements in the most cost effective fashion. As the case study authors point out, “The [integrated product teams] found significant costs associated with using.