Major Capability Acquisition (MCA)
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Reference Source: DODI 5000.85 Para 3.7
Milestone A approves program entry into the technology maturation and risk reduction (TMRR) phase, approval of the program acquisition strategy, and release of the final request for proposals (RFPs) for TMRR activities. A draft capability development document (CDD) approved by the DoD Component informs the acquisition strategy and the RFP for TMRR.
Principal considerations include:
- Justification for and the affordability and feasibility of the preferred military solution;
- Identification of the technologies that must be matured during the TMRR phase;
- The scope of the capability requirement trade space and an understanding of the priorities within that trade space;
- Technical, cost and schedule risks, and the plans and funding to offset them during the TMRR phase;
- A proposed acquisition strategy, including intellectual property (IP), program protection, and exportability and acquisition planning;
- The test strategy;
- A life-cycle mission data plan for each intelligence mission data-dependent program (including cyber) and the projected threat and its impact on the materiel solution.
The PM will present the acquisition strategy, the business approach, “Should Cost” targets, framing assumptions, an assessment of program risk and planned mitigation actions, and initial PS planning.
For MDAPs, the DoD Component will present a quantitatively supported affordability analysis based on the resources projected to be available in the DoD Component portfolio(s) or mission area(s) associated with the program under consideration. Similar, appropriately-scaled affordability analyses will be required for all other programs. The analysis will demonstrate the DoD Component’s ability to afford the program over its life cycle, and the DoD Component will demonstrate that the program will be fully funded within the Future Years Defense Program (FYDP). Pursuant to Section 2366a of Title 10, U.S.C., MDAs for MDAPs must determine, with a high degree of confidence, that the technology developed within the program will not delay the fielding target of the program. If the MDA determines that a technology related to a major system component will delay the program:
- The technology must be sufficiently matured and demonstrated in a relevant environment separate from the program, using the prototyping authorities in subchapter II of Chapter 144B of Title 10, U.S.C., or other authorities, as appropriate.
- The MDA must have an effective plan for adoption or insertion by the relevant program.
The MDA will approve
- the acquisition strategy to determine the materiel solution
- the strategy for the TMRR phase
- PM waiver requests
- release of the final RFP for the TMRR phase
- exit criteria required to complete TMRR, and entrance criteria for the Engineering and Manufacturing Development (EMD) Phase
The MDA will document decisions in an ADM.
Reference Source: DODI 5000.85 Section 3.1.b
The purpose of decision reviews embedded in the acquisition procedures described in this section is to carefully assess a program’s readiness to proceed to the next acquisition phase and to make a sound investment decision committing the Department’s financial resources. Consequently, reviews will be issue and data focused to facilitate an examination of relevant questions affecting the decisions under consideration and to allow the MDA to judge whether the program is ready to proceed.
- The MDA is the sole and final decision authority. Staff members and staff organizations support and facilitate the MDA's execution of that authority.
- The Defense Acquisition Board will advise the DAE on critical acquisition decisions when the DAE, or designee, is the MDA. The DAE or designee will chair the Defense Acquisition Board. Similar procedures will be established at the DoD Component level for use by other MDAs. An acquisition decision memorandum (ADM) will document decisions resulting from reviews.
- Overarching Integrated Product Teams at the OSD level, and similar organizations within the DoD Components, are expected to collectively assist the MDA in making sound investment decisions for the department, and to ensure programs are structured and resourced to succeed. These organizations are not decision bodies and they and their leaders do not supplant the authority of the PM, Program Executive Officer (PEO), component acquisition executive (CAE), or DAE.
See the Milestone Document Identification (MDID) tool for the statutory and regulatory information required.
Cost Questions at Milestone A
Reference Source: DAG CH 2-3.4 Milestone Specific Analysis
At each milestone or decision point, the analyst should provide a holistic view of the program and not just an estimate of the proposed solution. The cost analyst should provide analysis to the decision maker which provides insight enabling the decision maker to answer two main questions:
- Has the DoD fully funded the program of record within the Future Years Defense Program (FYDP)?
- Is the program of record an affordable solution for the DoD’s needs?
Determining the answer to the first question is straightforward: namely, is there funding in the budget and the FYDP that corresponds to the amount of funding forecasted to be necessary to carry out the program? The answer to the second question is more complex, and the analysis will vary at each milestone. Specific strategic questions for analysis at each milestone are described below.
At all milestones, when presenting analysis that will help the decision maker determine whether the program of record is one that fulfills the DoD’s needs and that the DoD can afford, the analyst should provide insight into:
- The cost of the solution
- Time needed to achieve the solution
- Whether the solution pushes the envelope on performance
- Any potential cost in extending the life of the current materiel solution until the new proposed solution is operational
- Whether the solution impacts the DoD Component’s portfolio by affecting other programs that are valuable to the DoD.
The key strategic questions the analyst should consider while conducting the Milestone A cost estimate are:
- What is the cost and performance trade space for the conceptual materiel solution and other potential solutions?
- Is the program affordable to both buy and operate in the long term?
- Are CA’s insights into the program consistent with the preferred solution of the AoA?
Reference Source: DAG CH 8-4.1.2 T&E Role in Milestone A Decision
The Milestone A decision approves program entry into the TMRR Phase. Prior to Milestone A approval, the Chief Developmental Tester ensures approval of the initial TEMP developed during the Materiel Solution Analysis (MSA) Phase. The RFP informs the Milestone A TEMP.
The responsible DoD Component may decide to perform technology maturation and risk reduction work in-house and/or award contracts associated with the conduct of this phase.
Reference Source: DODI 5000.85 3D.2.b.(5)
PMs will address programmatic environment, safety, and occupational health evaluation requirements throughout the program life cycle. PMs will manage hazardous materials in accordance with Aerospace Industries Association National Aerospace Standard 411, and National Aerospace Standard 411-1, tailored if necessary to meet their program’s needs.
Software Product Support Planning.
Software product support planning begins at program inception and continues throughout the program life cycle. The PSM is required to coordinate with the software development lead to determine what technical data is required to develop a best value support package that factors in quality, cybersecurity, risk management framework, technology refresh, and deployment over the program life cycle. Paragraph 3D.3.c.(7) of this appendix provides additional details.
PS Assessments and Refinements.
Continuously monitor and perform modifications to the PS arrangement to correct any trends that negatively impact availability and cost. Assessments of PS performance are also included to assist PMs, PSMs, system operators and maintainers, resource sponsors, and materiel enterprise stakeholders, take corrective action to prevent degraded materiel readiness and O&S cost growth on a recurring basis, no less than every 5 years, pursuant to Section 2337 of Title 10, U.S.C.
Competition in Sustainment.
Competition or the option of competition will be considered at the prime and subcontract levels for large and small business, and system and sub-system levels pursuant to Section 2337 of Title 10, U.S.C., and P.L.111-23.
Record the results and resolution of the core logistics assessment pursuant to Section 2366a of Title 10, U.S.C., detailed in the Milestone and Phase Information Requirements Table at https://www.dau.edu/mdid/Pages/Default.aspx.
Throughout the program life cycle, DoD Components will require CSDR on all sustainment efforts and contracts, including government sustainment efforts that exceed the cost reporting thresholds. Include identification of the cost reporting thresholds and additional CSDR requirements for sustainment programs pursuant to Section 2337a of Title 10, U.S.C., and in accordance with DoDI 5000.73.
The PM balances the energy performance of a system with the provisioning of energy to sustain required forces/systems by the operational commander in relevant threat environments in accordance with the JCIDS Manual Energy KPP Guide. Pursuant to Section 2926 of Title 10, U.S.C., the energy KPP identifies energy demands and supply relationships.
Supply Chain Risk Management (SCRM).
Pursuant to Section 2339a of Title 10, U.S.C., perform SCRM and supply chain threat assessments that provide an analytic foundation for counterintelligence to support defense acquisitions. SCRM should include cybersecurity of SCRM and item unique identification-enabled serialized item management (in accordance with DoDI O-5240.24 and the Threat Summary described in Annex G of the JCIDS Manual).
Critical Sustainment Cost Driver Management.
Pursuant to Section 2443 of Title 10, U.S.C., and in support of the TMRR, EMD, and P&D phases, DoD Components will ensure that weapon system source selection criteria for sustainment factors, principally affected by design and development, are sufficiently emphasized in weapon system design specifications, contracts, and source selection. Critical sustainment cost drivers include:
- 1. Includes total life cycle funding requirements for military, government, and contractor manpower. The future impact of contractor logistics support and interim contractor support will be determined with required annual operations and maintenance funding.
- 2. Includes the total life-cycle funding requirements for parts production and manufacturing, contract and organic repair of spares, contract depot level repairable or line replaceable unit repair start date, and the transition start and end dates to begin organic depot repair capability.
- 3. Denotes the program’s methodology for improving the fuel efficiency of the system, consistent with mission requirements, to: reduce the size of the fuel logistics systems; reduce the burden high fuel consumption places on agility; and reduce operating costs, pursuant to Sections 2911 and 2441 of Title 10, U.S.C., and in accordance with the JCIDS Manual, to assess actual fuel consumption compared to projected fuel consumption as demonstrated in tests or operations.
To provide for integrated PS, determine and update as necessary, the program’s mix of government and industry providers supported by appropriate analyses, because PS integrators and PS providers may be organic, commercial or a combination pursuant to Section 2337 of Title 10, U.S.C.
Determine necessary IP including technical data package deliverables, method of delivery, and associated license rights consistent with the program’s IP strategy, pursuant to Sections 2320, 2322, and 2460 of Title 10, U.S.C.
Perform sustainment and energy metrics assessment mapping to the Sustainment and Energy KPPs and Sustainment KSAs to manage sustainment performance in accordance with the JCIDS Manual and DoDI 3110.05.
Sustainment Questions at Milestone A
Reference Source: DAG CH 4–3.1.5 Milestone A
Milestone A is a risk reduction and investment decision. For product support planning, this decision establishes the product support strategy for the new capability. Below are key sustainment questions for the elements of the LCSP. This framework stimulates critical thinking but is not a complete listing of questions:
LCSP Section Considerations
- Introduction: Does the strategy require sustainment technology development?
- Product Support Performance: Have the Warfighter requirements (including planned operational environment and availability) been included in the draft CDD and decomposed to affordable sustainment design-to requirements (both weapon system and support systems)?
- Product Support Strategy: Have the plans for maintenance, supply, technical data, and manpower been defined such that cost and schedule estimates can be made? Are there alternatives? Are there planned sustainment trades?
- Product Support Arrangements: Have the TMRR phase sustainment-related tasks been identified? Are legacy/analogous system PSAs applicable?
- Product Support Package Status: Have the specific design features the PSM will assess in the TMRR phase design reviews been identified?
- Regulatory/Statutory Requirements that Influence Sustainment: Has core depot applicability been addressed? Has the program included how and when the requirements will be met?
- Integrated Schedule: Are logistics objectives linked to Program milestones? This includes Initial Operational Capability) (IOC), Initial Operational Test & Evaluation (IOT&E), Full Operational Capability (FOC), Material Support Date (MSD), etc.? Are major logistics events identified in sufficient detail for estimating sustainment costs? Are analyses phased to support milestones?
- Cost / Funding / Affordability: Are O&S Cost affordability goals established? Has a program office Life Cycle Cost Estimate (LCCE) been developed? Are there Should Cost management targets for sustainment?
- Management: Is the PSM in place? Are IPTs in place to address TMTMRR RR phase sustainment issues? Does the program/LCSP address competition across the system life cycle?
- Supportability Analysis: What analyses ensure affordable logistics and readiness (Level of Repair Analysis [LORA], depot support, organizational manning, and use studies)? What alternatives have been identified as Should Cost initiatives?
- Additional Sustainment Planning Factors: Are O&S Cost drivers for the legacy/analogous system and risk identified?
- LCSP Annexes: Are sustainment Cost Estimates and their drivers identified?
Reference Source: DAG CH 4–188.8.131.52 Draft Capability Development Document
Before Milestone A, the DoD Component’s requirements developer formulates a draft Capability Development Document (CDD), informed by the ICD and the AoA. This document contains all requirements for the system. The mandatory sustainment requirement is broken involves three attributes that enable affordable logistics performance: the Availability KPP, the Reliability Key System Attribute (KSA), and the O&S Cost KSA.