A Government Accountability Office (GAO) review found that the Department of Defense (DOD) does not review how contractors’ independent R&D projects fit into the department’s modernization priorities. As a result, GAO says DOD risks making decisions about science and tech investments that could duplicate work or miss opportunities.
At their own discretion, defense contractors can conduct research and development projects of potential interest to the Department of Defense (DOD) and may be reimbursed for some or all of this work. This kind of independent research and development in high-tech areas can help the U.S. military keep a technological edge. Contractors decide what independent R&D projects to conduct and the reimburses them about $4 billion-$5 billion annually.
DOD has a database of independent R&D projects, but it GAO said in its September 3 report that this is not very useful for informing investment decisions because DOD does not obtain information in these and other areas:
- Priority. Contractors do not identify whether a project aligns with any of 10 modernization priorities. The department uses those priorities to make decisions about R&D investments.
- Cost. The database does not capture a project’s complete cost, which could help DOD understand cost implications of future related work.
- Innovation. The database does not include whether a project is a lower-risk, incremental development or a more innovative “disruptive” technology. Disruptive projects carry higher risk of failure but offer possible significant rewards in the long term.
While DOD is not required to review independent R&D projects to understand how they support DOD’s priorities, GAO analysis showed 38 percent of industry projects aligned with DOD’s priorities.
To help DOD better understand the scope and nature of independent projects, GAO recommends DOD determine whether to require additional information in the project database and review projects annually as part of its strategic planning process. DOD concurred and stated that the it would recommend any changes to the database requirements to the Director of Defense Research and Engineering for Research and Technology— which provides programmatic oversight—for decision.