By Bryan Rahija
Air Force Lt. Col. Dan Ward, Chief of Acquisition Innovation under the Air Staff's acquisition directorate, advocates a particular approach to acquisitions: one that is fast, inexpensive, simple, and tiny, aka the FIST approach. His writing often appears in Defense AT&L magazine (as do the FIST comics that adorn this blog post). POGO recently caught up with Lt. Col. Ward to discuss FIST, contractor incentives, and chartsmanship.
POGO: What Is FIST?
Lt. Col. Dan Ward: FIST stands for Fast, Inexpensive, Simple and Tiny. It’s a term I use to describe a particular approach to acquisitions and system development. As you might guess, it involves using a small team of talented people, a tight budget, a short schedule and adhering to a particular set of principles and practices. I’ve observed this pattern, studied it, and personally implemented it several times. I’ve published a number of articles about FIST and done a lot of presentations—at conferences, in classrooms and visiting various organizations—but I’m still in the process of spreading the word and encouraging people to try it.
To be clear, I coined the term but I can’t say I created the approach—the FIST approach liberally borrows from sources that range from the legendary Skunk Works to modern Agile software practices. Other than the acronym and the way I put the pieces together, I must admit there’s not a lot of new stuff here.
And really, FIST isn’t some weird approach to system development and acquisitions. DoD Instruction 5000.2 says “The objective is to balance needs and available capability with resources, and to put capability into the hands of the user quickly.” That’s what it’s all about—balancing needs against constrained resources and fielding capabilities at the speed of need. The [Government Accountability Office] GAO tells us we should use the budget and schedule to constrain the design. I think that’s a pretty good idea, and again it’s not just from a financial perspective but also from an operational perspective. FIST says thrift, speed and simplicity are desirable technical attributes, not just programmatic goals. The key is to manage complexity smartly and solve problems by applying intellectual capital instead of financial capital. FIST provides a toolbox to do just that.
Lt. Col. Ward: I’ve got a big collection of examples, and they come in two categories. The first group is programs that explicitly use the term FIST and the guiding principles as I’ve defined them. At this point it’s a pretty small sample size—a half-dozen or so small, obscure programs I directly worked on, plus a few that are just starting out and haven’t delivered yet.
The other category includes programs that fit the model but don’t explicitly using the term. These are programs that focused on simplicity, budgetary restraint and schedule restraint to deliver amazing capabilities. Some recent examples include the MC-12 Project Liberty aircraft (went from contract to combat in 8 months), the Air Force Research Laboratory’s Condor Cluster supercomputer (fastest supercomputer in the DoD, developed for one tenth the cost of a comparable system) and the Marine Corps’ Harvest Hawk “instant gunship” program. These programs weren’t accidentally fast, nor are the technologies involved inherently less expensive or simpler than other types of technology. Each case was the result of a deliberate strategy and a particular pattern of decision-making. I call that pattern FIST.
I don’t want to give the impression I’m taking any credit at all for the programs in that second group. In fact, their stories helped me develop and mature the FIST approach, so if anything, they get credit for developing FIST and not the other way around.
POGO: After the blog Herding Cats highlighted the FIST method in a recent post, a commenter wrote in to say that FIST might not work in larger-scale contexts. How do you respond to that criticism? Can the military apply the FIST approach to deliver major weapons systems like the Joint Strike Fighter?
Lt. Col. Ward: Do nuclear submarines count as “large scale” projects? If so, the Navy’s Virginia Class submarines show we can do FIST on a major weapon system. These boats were deliberately designed to be a simpler, lower-cost alternative to the earlier Seawolf subs. When the USS New Hampshire came in 8 months early and $54M below budget, that wasn’t a fluke (the New Mexico and the Hawaii also delivered early).
The thing to understand is that FIST is a set of decision-making guidelines which can be applied in a variety of different contexts. There is no FIST threshold value for budget or schedule, so a program could cost many millions of dollars and take several years and still be the result of the FIST approach, as long as it’s faster, cheaper and simpler than its alternatives.
Of course, FIST isn’t the only way to do good work and it’s not a silver bullet. It won’t solve every possible problem and I’m not saying every program should automatically use the FIST approach. But my experience and research indicate FIST is a pretty effective way to deliver all sorts of capabilities.
The bottom line is we almost always have options to reduce a program’s cost, timelines and complexity. FIST highlights those options. It provides guidelines and practical tools we can use to rapidly deliver systems that are simultaneously affordable and completely dominant on the battlefield.
POGO: We recently received this comment on our blog:
Ever since we started routinely adding a profit margin to the defense contractor's reimbursement on development costs, development periods and costs have increased substantially. In the case of fighter jets, the development period has gone from a few years to several decades and costs are through the roof. Clearly the longer the development period lasts and the more it costs, the more profit the contractor makes, which is at odds with how we want the contractor to perform. Seldom are there any permanent award fee penalties. Even cost over runs are fixed through frequent contract renegotiations such that rarely is a contractor reimbursed for any development costs they don’t receive a profit on. So why do we continue to pay contractors more to drag out the time and escalate costs for development, and isn't it time we reconsidered the cost-plus-award-fee approach to buying weapons?
How would you respond to this comment? Are taxpayers shouldering too much of the burden for development costs?
Lt. Col. Ward: Dr. Carter’s recent emphasis on fixed price incentive fee (FPIF) contracts is intended to help address this exact situation, by providing smarter incentives to industry. There was never an intention to reward delays, and the shift towards FPIF contracts strikes me as a good way to deal with this issue.
Also, I’m not sure I accept the commenter’s assumption because a long program is not automatically more profitable than a short one. In fact, the data I’ve seen suggests the FIST approach actually increases profit, partly because fast, small, inexpensive programs tend to succeed more often than slow, big, expensive ones… and success is more profitable than failure. I explore this topic in more depth in an article that will be published in the May 2011 issue of Defense AT&L magazine
POGO: In "Wanting It," your article in the November-December issue of Defense AT&L, you play with the theme of a training montage for an aspiring acquisitions hero. Is there anything you would change about the way we are training acquisition personnel? If you could design an actual training program for acquisition officials, what would be the most important courses in your curriculum?
Lt. Col. Ward: I think our training should include more games because games are a great way to hone decision-making skills. I love Jane McGonigal’s vision of the power of gaming and I hope the ideas in her Reality Is Broken book catch on everywhere.
I’m happy to report we’ve already taken some steps in this direction—the Program Management Office course at Defense Acquisition University (DAU) uses a fantastic computer simulation called Dragonfly that is fun, engaging and highly educational. That’s a great start and I’d love to see more things like it. A lot of civilian MBA programs use a “business flight simulator” called Marketplace. I’d love to see an acquisition version of Marketplace.
I’d also love to see a class on Chartsmanship and Presentation Skills, using Garr Reynolds’ Presentation Zen as the text book. To pass the class, students would have to take a particularly bad chart deck and improve it so it’s clear and communicates well, then brief it and be rated on their performance. The advanced class could focus on how to present more complex data, using Edward Tufte’s books as texts.
And of course it would be great to see FIST formally incorporated into the curriculum. I’ve got several friends who teach at DAU and use FIST in their classes. I’ve also been a guest lecturer at DAU and AFIT many times and am working with a couple universities on tailored acquisition classes. So we’re making headway, but I’d still love to see FIST adopted more widely. I don’t think we need a FIST class per se but it would be great to see the principles and practices integrated into the courses we already have.
POGO: In The Pentagon Labyrinth, a new book on defense reform, Thomas Christie argues that one essential ingredient to a viable weapons acquisition system is continuous evaluation:
As a new program begins, a process of continuous and independent evaluation must be established to track the program through development, testing and production, and eventual fielding and employment by operational forces. In the early stages, such evaluations should be based on emerging test results and updated cost estimates, and should focus on those attributes or capability measures that formed the basis for program approval. These evaluations should be updated with results presented to senior leadership on a routine basis—certainly at least annually.
Do you agree with Christie? Is this recommendation antithetical to the FIST approach and the notion that trust trumps oversight?
Lt. Col. Ward: I’d never want to argue with Tom Christie. The man is a legend. And yes, I’m in favor of continuous evaluation, of rigorously collecting actual data to inform our decisions. This isn’t antithetical to FIST or to trust. It’s just a good practice. If there’s one thing we learned from "The Pentagon Wars," it’s that maintaining situational awareness and getting actual test results is pretty important. It’s not a question of trust. It’s a question of turning real data into real understanding.
At the same time, I think we need to be careful. It’s possible to spend too much time and money collecting too much data. There’s a point of diminishing returns, in terms of the data’s cost and its value. We need to get enough data, at an appropriate level of precision and granularity, and at the right time in the program’s life. Sometimes we just need a quick and dirty test. Other times we need a more rigorous approach. The key is to be honest about what data we need and what the data actually says. I think that’s entirely consistent with Mr. Christie’s proposal.
One other point to keep in mind: the data never speaks for itself. We always have to interpret and analyze it. It’s no good to collect data if we don’t know what to do with it. So in order to use this continuous evaluation approach, we need to make sure we cultivate good data skills and good decision-making skills… which gets us back to the training question and the importance of reading McGonigal, Reynolds and Tufte.
POGO: Who's more to blame for weapons program cost overruns and schedule delays: the government or contractors? Why?
Lt. Col. Ward: I don’t think it’s terribly useful to point fingers or tell one group they are more responsible than the other. Weapon system development is a team effort—everyone contributes to the outcomes, whether they’re positive or negative.
Ultimately, I think the real culprit is our fascination with complexity, viewing it as a sign of sophistication. People on both sides of the contract can fall into that trap. When I talk about FIST, I emphasize the importance of understanding both the value and the cost of complexity. I talk about different techniques for dealing with complexity, both organizationally and technically. That’s basically what my Simplicity Cycle book is all about.
And one final observation. In the 2009 Acquisition Improvement Plan (AIP), the [Secretary of the Air Force] SECAF and [Chief of Staff of the Air Force] CSAF directed the Air Force acquisition and financial managers to improve the requirements generation process and to instill budget and financial discipline. These two initiatives have significantly tightened up our requirements and driven down contract changes. Because of the AIP initiatives, our Cost / Schedule / Performance are now much more stable at the Preliminary Design Review phase than before, and that’s goodness. We’ve taken serious steps to link profits and awards more directly to to performance. Real institutional changes like that are designed to help us avoid future cost overruns and schedule delays.
DISCLAIMER: The views expressed in this post represent the personal views of the author and are not necessarily the views of the Department of the Defense or the Department of the Air Force.
FIST images created by Dan Ward, Chris Quaid, Gabe Mounce, and Jim Elmore.
Bryan Rahija edits POGO's blog.