Congressional battle brewing over a small, but influential office in DoD

One of the Defense Department’s most innovative offices was in jeopardy earlier this year, but now it seems like the Senate Armed Services Committee might throw it a life preserver.

The Senate version of the 2019 defense authorization bill explicitly forbids the Defense Secretary from eliminating or transferring the functions of the Strategic Capabilities Office (SCO) to any other part of the Pentagon.

The provision seems strange, considering SCO has been one of DoD’s poster children for the way it wants the acquisition process to work.

The office has been modifying DoD’s state-of-the-art toys since 2012 and it works on swarming drones, augmented reality and every other new technology coming to light.

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But the  House version of the 2019 defense authorization bill completely gets rid of the fast-paced office, setting up a potential fight between the two legislative houses.

A House Armed Services Committee aide said the committee wants DoD to scale SCO’s “magic” to broader applications, which is why it’s pushing to downgrade the office.

“This is designed to think about the ‘What’s next’ aspect of SCO and to think about also taking what SCO has done in terms of culture and making sure that is spread across the services. That’s in conjunction with the other transaction authorities (OTA) that have been provided,” the aide said.

OTAs are agreements that circumvent the defense acquisition regulations resulting in faster acquisition with fewer rules businesses have to follow.

The aide said it’s still up for debate whether SCO’s culture, speed and innovation can be broadened to DoD acquisition as a whole.

Looking at the Senate language of the bill, it seems the House and Senate aren’t thinking too differently about SCO, however.

The Senate bill may keep the defense secretary from getting rid of SCO, but it gives DoD some caveats if the Pentagon does want to nix it.

The bill says to cut SCO, DoD needs to show it has a plan to replicate SCO’s abilities somewhere else in the department.

It also says if DoD wants to get rid of SCO it must submit a plan to replicate and manage the functions of SCO and to justify the decision.

It seems like the Senate is giving DoD and the House a little wiggle room to scale up SCO’s abilities to the broader DoD as the House committee aide suggested.

The Senate just seems to be taking a much more cautious tact to any changes and wants to make sure SCO survives if DoD can’t scale up it’s functions.

As for the possibility of actually making SCO’s functions larger, that’s up for debate.

“SCO has a very specific mandate. Their thing is they take existing technologies and figure out how to use them in different ways,” Susanna Blume, a senior fellow at the Center for a New American Security, said. “The SCO magic isn’t something that’s going to work for the DoD acquisition enterprise as a whole nor should it. But you also don’t want to divest that capability because it’s really useful to have a group of really smart people thinking about different applications for existing technologies.”

Blume said expecting SCO’s agility to permeate into all of DoD is a fool’s errand.

“SCO doesn’t scale … You can’t apply that to the DoD acquisition enterprise writ large because someone has to develop the new stuff from scratch. The reason SCO is so agile is because they are working with systems where the vast majority of the technological risk has already been retired. But you can’t apply that to the parts of the acquisition enterprise that are in charge of retiring all that technological risk in the first place,” Blume said.

But there may be other reasons the subcommittee wants to get rid of SCO. As of February 1, the Pentagon acquisition office was split in half. Half of the office went to the undersecretary for acquisition and sustainment, the other half went to the undersecretary of research and engineering.

The research and engineering office is supposed to be able to break free of the day to day acquisition issues and focus purely on building new technologies.

The House may want to see what that office can do with SCO’s authorities.