Pentagon Official Says Workarounds Have Not Fixed Core Defense Acquisition System

DETROIT — Assistant Secretary of Defense for Industrial Base Policy Michael Cadenazzi said that Pentagon efforts to work around a slow and rigid acquisition system have not produced fundamental structural improvements to the core process. Those steps brought in tech disruptors, venture-backed firms and new industrial players.

Cadenazzi stated that the collective number of such outside-the-lines initiatives have not resulted in fundamental structural improvement of the core acquisition system. "The collective number of outside the lines initiatives have not resulted in fundamental structural improvement of the core acquisition system, and that means that we’re not spending enough time internally," said Cadenazzi.

He spoke on May 12 at the joint XPonential/MDEX conference. The challenge is no longer simply innovation but production at scale, he said. The country outsourced manufacturing to its greatest strategic competitor and became dependent on foreign firms and countries for vital inputs.

That shift led to the loss of generations of scientists, engineers, skilled trades workers and production know-how. The consequences appear in shipbuilding delays, aircraft delivery delays, vehicle readiness issues, workforce shortages and lower-tier supply chains vulnerable to counterfeit or Chinese-made components.

For drones the Pentagon is only now starting to fund its first rounds of bulk purchases of first-person-view drones, years after Ukraine perfected them. A promising drone, sensor, software or autonomous system does not solve the warfighter’s problem if it cannot be acquired at scale, certified quickly, produced reliably, exported to allies and supported through a resilient supply chain, Cadenazzi said.

Officials are now directing attention to fixing the core system. "Our charge is to spend the time and do the hard work to fix the core system," he said. "If you read the ATS you’ll find that it is not reflective of an interest going outside the lines.

The realignment also extends to improving Foreign Military Sales and Direct Commercial Sales processes for partners, including drones. Officials shifted the Defense Security Cooperation Agency and the Defense Technology Security Administration under the office of acquisition and sustainment.

The goal is to match international demand with actual production capacity, speed deliveries to allies and partners and create stronger demand signals for industry. Cadenazzi said the realignment is still being worked through with no results available yet.

He described it as a structural improvement that could help address production shortfalls.