Hegseth's Acquisition Reform Sabotaged: Bureaucracy Wins?

Pentagon Acquisition Reform Faces Bureaucratic Pushback

Secretary of Defense Pete Hegseth delivered a forceful speech on November 7 outlining radical reforms to how the Department of Defense develops and procures military capability. The address struck an optimistic tone about accelerating innovation and competing effectively with China. Yet a detailed comparison between the leaked draft memo and the final released guidance reveals a troubling pattern: core reform proposals were systematically removed or weakened during internal deliberations.

The leaked memo, reported by Breaking Defense one week before Hegseth’s speech, tracked closely with his public remarks. However, the officially released version tells a different story. Several critical initiatives disappeared entirely or were significantly compromised.

Among the most consequential changes: the removal of mandates for fixed delivery cycles and time-based development prioritizing iterative learning. The original memo emphasized minimizing cycle time between need identification and contract award—a process that currently takes up to seven years. These provisions vanished from the final version, effectively rejecting the accelerated innovation model that once drove U.S. technological dominance.

Streamlined authority structures also suffered. The leaked memo wisely mandated direct acquisition authority flowing from Program Manager to Portfolio Acquisition Executive to Service Acquisition Executive without intermediate approval layers. The final document reversed course, restoring service comptroller bureaucracies and multiple committees to the approval process—precisely the organizational friction Hegseth sought to eliminate.

Perhaps most significantly, the preference for using Other Transactions Authority (OTAs) was struck entirely. This omission signals a retreat from contractor flexibility, burdening non-traditional firms with traditional government cost accounting, pricing data, and compliance requirements that historically limited defense participation to established contractors. The prospect of leveraging OTAs—the mechanism enabling SpaceX’s creation—promised to unlock venture capital investment in defense innovation. Its removal effectively signals industry that status quo procurement reigns.

Performance metrics encouraging alternative suppliers were eliminated, along with modular open systems approach (MOSA) requirements for existing programs. The final memo granted Service Acquisition Executives broad waiver authority to bypass MOSA implementation on new programs. Additionally, numerous discretionary qualifiers—“where appropriate,” “to the maximum extent practicable”—granted the bureaucracy absolute discretion to ignore directives.

While debate continues over whether changes reflect legitimate refinement, political input, or bureaucratic self-preservation, the disconnect between Hegseth’s vision and the final implementation document is undeniable. Defense transformation requires sustained leadership attention. Without rapid corrective action, the acquisition bureaucracy’s historical resistance to change will predictably undermine reform during implementation. Real modernization demands principals maintain firm control of the execution process.

Source ID: SRCE-2025-1764608686505-1045