Rapid Fire August 8, 2013: Incentives for Should Cost Acquisition

• US Defense Acquisition Undersecretary Frank Kendall issued a memo [PDF] on should cost management giving some flexibility to the services to provide them an incentive to pursue savings:

“Components will continue to baseline acquisition budgets using will cost estimates and CAPE Independent Cost Estimates when available […] However, successful should cost initiatives should drive down future program budgets once the savings have been demonstrated and realized. Components have the latitude to apply savings to their most pressing unfunded requirements, or may reinvest this funding within the same programs to accelerate the acquisition, fund cost-reduction initiatives, or cover critical unfunded requirements.”