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Defense Acquisition: A Tragedy of the Commons

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  • Michael J. Pennock

Abstract

Defense acquisition programs are notorious for their cost overruns, schedule delays, and performance shortfalls. While there are likely numerous contributing factors to this state of affairs, one frequently cited cause is the overreliance on immature technology. Despite the well‐known risks entailed in the employment of immature technologies, the practice persists. The question logically follows: why would programs pursue a policy that seems to be counterproductive? To understand this situation, a mathematical model of a series of acquisition programs is developed and analyzed. It reveals that when differing stakeholder interests come into play, the program suffers from a classic tragedy of the commons. The program serves as a common resource for these stakeholders, and they are incentivized to pursue aggressive performance requirements that necessitate immature technology. The critical aspect of this result is that this behavior is rational. In other words, the behavior we see is exactly what we should expect to see. This suggests that the recent trend in defense acquisition to reduce costs by aggregating the requirements of multiple groups of users into a single program may actually be counterproductive. This result has implications for the policy makers, managers, and engineers that are responsible for developing and deploying defense systems.

Suggested Citation

  • Michael J. Pennock, 2015. "Defense Acquisition: A Tragedy of the Commons," Systems Engineering, John Wiley & Sons, vol. 18(4), pages 349-364, July.
    • Handle: RePEc:wly:syseng:v:18:y:2015:i:4:p:349-364
    DOI: 10.1002/sys.21308
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