| Collaboration With the Commercial Industrial Base | | https://www.dau.edu/library/defense-atl/Lists/Blog/DispForm.aspx?ID=201 | Collaboration With the Commercial Industrial Base | 2020-09-01T16:00:00Z | https://wwwad.dauext.dau.mil/library/defense-atl/PublishingImages/DefAcq_Sep_20_banner02.jpg, https://www.dau.edu/library/defense-atl/PublishingImages/DefAcq_Sep_20_banner02.jpg
https://wwwad.dauext.dau.mil/library/defense-atl/PublishingImages/DefAcq_Sep_20_banner02.jpg | <div class="ExternalClass7B2FE701D441425F808D4F672FD0C6DF">The 2018 National Defense Strategy identified rebuilding military readiness as we craft a more lethal Joint Force as one of three distinct lines of effort for implementation. Tackling such a daunting challenge will require a multipronged approach to address a range of maintenance and sustainment hurdles, including aging infrastructure, legacy systems and technology, and efficiency obstacles. Our Warfighters cannot guarantee mission success with weapon systems that are grounded, waiting for repair parts, backlogged due to dated maintenance facilities, or supported by key maintenance personnel who need training.<br>
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With the military Services facing this seemingly insurmountable task—achieving improved product support maintenance, and sustainment readiness without increased resources—what’s the answer?<br>
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One solution among many to meet this challenge is to collaborate with the commercial sector defense industrial base and leverage both new and existing maintenance and sustainment-enabling technologies.
<h2>Commercial Off-the-Shelf Technology (COTS) as an Asset for Readiness</h2>
Historically, it can take years to develop, test, and adapt technology that directly addresses a sustainment need. Given the pace of technology change and the rapidly evolving threats we face, time is a luxury we simply do not have. The need for speed is so pressing that Congress enacted legislation and the Department of Defense (DoD) is implementing policies, processes, and procedures to facilitate quicker delivery with an eye toward concurrently improving readiness and reducing life-cycle costs.<br>
But what if the DoD didn’t need to spend all those years developing new logistics, product support, and maintenance technologies? What if the DoD simply could adopt commercially available technologies that are already proven or rapidly developing?<br>
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In 1998 Congress and the DoD created the Commercial Technologies for Maintenance Activities (CTMA) Program. This Cooperative Agreement—administered through the National Center for Manufacturing Sciences (NCMS), and the Office of the Deputy Assistant Secretary of Defense–Materiel Readiness (ODASD–MR)—leverages already developed, commercially available, maintenance and sustainment technologies that can address an unmet readiness challenge. Software platforms, inspection technology, handheld equipment, asset-tracking abilities, and numerous other capabilities are all critical needs that could be solved by looking no further than commercial industry, which already uses these novel capabilities.<br>
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The CTMA Program also provides proven “out-of-the-box” solutions on maintenance and sustainment technology transition. How many times has technology been purchased, even after jumping through all the certification and testing hoops, only to have it not work as hoped? Wouldn’t it be advantageous to actually try a technology first to ensure that it does what it is meant to do? This way, rapid prototyping can take place with results that can be put to work immediately.<br>
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When customers buy a car, for example, companies sometimes offer a trial period. Drive it for the weekend—and if you don’t like it, return it. Wouldn’t it be a game-changer if the DoD could seek the same kinds of opportunities? It absolutely can do so in the product support, maintenance, and sustainment realm. The CTMA Program offers a unique option to “try it before you buy it.” This program is designed to evaluate, demonstrate, and validate technologies in a collaborative environment where expertise from both the government and industry is brought together to adapt or modify existing, commercially available technologies to meet government needs and expectations.<br>
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In all cases, the end users are able to integrate the new technology in their work streams and determine for themselves if it makes them more capable, effective, efficient, safer, or less costly. If through the testing and demonstration phase the technology isn’t right, it can either be modified to make adjustments or the government can move on. No harm, no foul. Significant investments and years have not been wasted because these technology demonstrations can be organized quickly. Contracts are executed at lightning speed, often within 45 to 90 days of submissions. In addition, the CTMA initiative partners are working concurrently with all stakeholders to identify requirements for integrating the capability into the maintenance and sustainment operations to ensure technology transitions for all successful demonstrations.<br>
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Why reinvent the wheel? Why spend years developing technology that soon will be obsolete? The DoD already has obsolescence challenges. Sustainment technology shouldn’t be one of them.<br>
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Over the last 22 years, the CTMA Program has grown as government and industry worked together to collaboratively address readiness issues. Whether sustaining aircraft, ships, or tanks, the maintenance needs of all the military Services are far more similar than distinct—and in many instances more than one Service regularly participates in a CTMA project actively or as an observer. Results and best practices are shared to alleviate duplication of efforts and needless expenditures related to the “not invented here” mindset.<br>
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The DoD has identified several focus areas where streamlined sustainment activities are ripe for innovative COTS technologies. These include:
<ul>
<li>Additive Manufacturing</li>
<li>Autonomous Logistics</li>
<li>Business Processes and Partnerships</li>
<li>Predictive Maintenance and Condition-Based Maintenance Plus</li>
<li>Coatings and Corrosion Prevention</li>
<li>Advanced Electronics Maintenance</li>
<li>Energy, Environmental, Health, and Safety</li>
<li>Enhanced Non-Destructive Inspections</li>
<li>Reliability Improvement (Hardware)</li>
<li>Training and Miscellaneous</li>
</ul>
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To emphasize the need for readiness, new congressional language was added to the National Defense Authorization Act in 2017, Section 806, which addressed Development, Prototyping, and Deployment of Weapons System Components or Technology. Among other imperatives, the statutory authorization today outlined in 10 United States Code 2447d provides the DoD with “mechanisms to speed deployment of successful weapons system component or technology prototypes.” Cooperative Agreements, such as the CTMA Program, are a viable vehicle to support this endeavor, particularly when they “address a high priority warfighter need or reduces the costs of a weapon system.”
<h2>Small Sustainment Efforts Deliver Significant Savings</h2>
So, what exactly does this mean in practical terms? Are there any successful real-world examples? The short answer is yes! Just a few examples include:<br>
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<strong>Expeditionary Fluid Analysis Capability (EFAC).</strong> This initiative was born from the sand and other debris degrading the lubricants in tactical vehicles in the 1991 Gulf War—Operation Desert Storm. Maintainers on the ground needed to find better a way to test lubricants in the field rather than sending samples to an approved laboratory and often waiting for days or sometimes longer for analysis results. This process resulted in critical vehicles parked and not mission ready. Concurrently, thousands of gallons of oil were wasted from unneeded oil changes completed on a predetermined calendar-based schedule. This unnecessarily costs labor hours and supply resources.<br>
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Leveraging the CTMA Program, the Office of the Secretary of Defense (OSD), along with the Joint Staff, the U.S. Army Combat Capabilities Development Command Data and Analysis Center, and several industry organizations with expertise in fluid analysis and deployment are working collaboratively to address the issue. The DoD, including the OSD, the U.S. Army, U.S. Navy, Marine Corps, and Air Force were briefed on several technologies available during a recent Industry Day. The government sponsor selected the technology that enabled the ground maintainer, at the point of service, to quickly and reliably determine whether a change was necessary—and select to test the one that appeared to best fit its needs.<br>
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By the evaluation’s conclusion, the yearly cost savings for the Marine Corps alone were estimated at $3.2 million with 30,000 fewer labor hours. The Marines now are acquiring and integrating EFAC across applicable maintenance activities. Across the DoD, estimated savings could potentially be as high as 1,340,426 labor hours per year and a return on investment of more than $21 million. An important benefit of using less oil is reduced environmental impact.<br>
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<strong>Intermittent Fault Detection Inspection System (IFDIS). </strong>According to the Joint Intermittent Testing Working Integrated Product Team established by the OSD, the DoD spends an estimated $2 billion yearly in detecting and isolating faults in aircraft wiring bundles and Weapons Replaceable Assembly (WRA)/Line Replacement Units (LRU). These faults include opens and shorts, degraded and intermittent signals, and insulation degradation. The magnitude of the challenge is daunting, with the DoD spending approximately billions annually removing and replacing WRAs/LRUs that, when tested, are determined to be “no-fault-found” (NFF). Additionally, legacy electronic components experience increasingly reduced reliability as a result of component age and usage.<br>
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This is an unpredictable situation for a technician who is trying to diagnose an electrical intermittency problem in a complex system of continuity paths. The intermittency event could occur on one or more of thousands of potential circuits, with a disruption duration measured in nanoseconds, and occurring by chance in time, or possibly not failing at all while the technician actively looks for it.<br>
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With an unacceptable number of aircraft grounded, solving this important wiring issue was increasingly important. Both the F-16 and F-18 (among other aviation weapon system platforms) experienced intermittent circuitry issues that grounded many of them. Moreover, the current technology was unsuited for portability, which was a critical need when looking for faults on aircraft operating at Forward Operating Bases or on board aircraft carriers. Several companies already had available wiring fault-detection capabilities, and one stood out with a technology adaptable to fit the unique needs of the Air Force and Navy.<br>
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With modifications, a portable wire inspection technology was developed—the Voyager Intermittent Fault Detector (VIFD)—that met needs. Testing and certifications proceeded with spectacular results. The testing succeeded, with IFDIS and VIFD locating and diagnosing NFFs. The VIFD has been applied to the F/A 18, V-22, A-10, H-53, AH-64, UH-60, and Patriot Missile Systems with intermittent faults detected and isolated by VIFD in 99 percent of the wiring systems tested (or 30 different wiring systems). This technology has been formally adopted by such facilities as the Naval Surface Warfare Center, Crane Division, with the Air Force evaluating it and the DoD assessing the benefits of utilization throughout the defense enterprise.<br>
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<strong>Shipyard Industrial Analysis. </strong>To help the four naval shipyards more efficiently maintain today’s fleet, this CTMA initiative utilizes a commercial digital modeling and simulation technology modified to fulfill the Navy’s needs. Using this advanced technology, already utilized by commercial shipyards, the current naval shipyard infrastructure, configuration, and maintenance processes can be evaluated to assess best practices prior to investment by creating a digital twin in order to define the optimums. This holistic approach will decrease fleet repair time, increase productivity, and save costs with the goal of enhancing Warfighter readiness now and into the future.
<h2>The Technology May Already Be Here</h2>
According to the 2019 Department of Defense Fact Book issued by the Office of the Assistant Secretary of Defense for Materiel Readiness, the DoD spent more than $93 billion last year in maintenance activities, and $163.5 billion for product support of 330,159 vehicles, 239 ships and submarines, and 14,883 aircraft. To ensure affordable readiness for such a wide array of weapon systems, the dexterity and capabilities that COTS technology can bring to bear in a range of readiness needs must be in our toolkit.<br>
Approaching solutions in the traditional manner is a nonstarter—we simply don’t have enough time or resources. We have an uphill battle. But with collaboration and an eye for what is possible, together we can achieve our readiness goals. With the speed of relevance as a new sustainment goal, the acceptance, adoption, and integration of commercially available technologies offer a cost-effective, high-impact readiness enabler.<br>
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In this environment of near-peer adversaries, constrained budgets, heavy reliance on legacy platforms, and a rapidly evolving threat environment, the DoD faces an ever-present readiness challenge. Readiness levels are a paramount concern. The DoD is committed to streamlining the traditional acquisition process to get the most technologically advanced solutions into the hands of our maintainers. Integrating COTS capabilities into the DoD’s maintenance and sustainment enterprise brings the best that the U.S. industrial base has to offer to our Warfighters.<br>
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The bottom line is summarized in a prescient quote from Henry Ford: “Coming together is a beginning, staying together is progress, and working together is success.”<br>
For additional information about the CTMA Program visit <a href="http://www.ncms.org/ctma">www.ncms.org/ctma</a> or contact Greg Kilchenstein at the Office of the Deputy Assistant Secretary of Defense for Materiel Readiness at <a class="ak-cke-href" href="mailto:gregory.j.kilchenstein.civ@mail.mil">gregory.j.kilchenstein.civ@mail.mil </a>or Debra Lilu at the National Center for Manufacturing Sciences at <a class="ak-cke-href" href="mailto:debral@ncms.org">debral@ncms.org</a>.
<hr />Shelton is the Partner Outreach Specialist for the National Center for Manufacturing Sciences, a technology consortium that accelerates the development and adoption of innovative manufacturing and technology capabilities. Kobren is the Director of the Logistics and Sustainment Center at the Defense Acquisition University.<br>
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The authors can be contacted at <a class="ak-cke-href" href="mailto:eleanors@ncms.org">eleanors@ncms.org</a> and <a class="ak-cke-href" href="mailto:bill.kobren@dau.edu">bill.kobren@dau.edu</a>.</div> | string;#/library/defense-atl/blog/Collaboration-With-the-Commercial-Industrial-Base | | | | | | | |
| “A Marriage Made in Heaven”? | | https://www.dau.edu/library/defense-atl/Lists/Blog/DispForm.aspx?ID=202 | “A Marriage Made in Heaven”? | 2020-09-01T16:00:00Z | https://wwwad.dauext.dau.mil/library/defense-atl/PublishingImages/DefAcq_Sep_20_banner03.jpg, https://www.dau.edu/library/defense-atl/PublishingImages/DefAcq_Sep_20_banner03.jpg
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Sometimes opposites attract—two magnets, peanut butter and jelly, or one spouse in a marriage who abhors fish yet agrees to visit the same sushi restaurant each week. Other Transaction Authority (OTA) agreements and data rights rules are an example of opposites attracting. Think of the Other Transaction (OT) as the spouse whowould like to try a new restaurant and new meal every time, and the data-rights rules as the spouse who must go to the same restaurant, order the same food, and sit at the same table. Here we will discuss various methods of incorporating data rights into OT agreements, as well as delve into some of the benefits and risks to certain techniques.<br>
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The Federal Acquisition Regulation (FAR) sets forth the principal rules governing federal acquisitions of supplies and services through procurement contracts. The Department of Defense (DoD) goes beyond the FAR with the Defense Federal Acquisition Regulation Supplement (DFARS). While OT agreements should cover both who gets patent ownership and rights related to subject inventions and the government’s rights to use, or disclose, any technical data and software deliverables, let us focus here solely on data. Rights in technical data and computer software deliverables and rules for data markings for the DoD generally are based on the DFARS. Its clauses and provisions for data rights and data-rights markings are stringent and direct regarding what rights (not ownership) the DoD is entitled to receive.<br>
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The DoD generally includes the provisions and mandatory DFARS clauses in a solicitation to obtain the proper rights. Specific standard data rights depend upon many factors. These include whether the deliverable is commercial or noncommercial, the type of data (form, fit, and function, or necessary for operation, maintenance, installation, and repair), or who funded development of the item, component, or process (government, industry, or both), or if it is data created exclusively atthe DoD’s expense in performance of a contract. This process is quite structured, has been used for decades, and often is time-consuming and bureaucratic. Figure 1 compares the DFARS-related data rights and those from using an OT.<br>
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<img alt="" src="/library/defense-atl/DATLFiles/Sept-Oct_2020/DefAcq_Sep-Oct2020_article03_figure01.jpg" style="margin-left:3px;margin-right:3px;width:627px;height:400px;float:left;" />Arguably opposite of procurement contracts in flexibility and specific requirements are OTs, vehicles that have been utilized by the government for decades. OTs can offer streamlined approaches to obtaining the best technology for the government. OTs are categorized into three types of agreements: (1) research, which often is referred to as a Technology Investment Agreement; (2) prototype; and (3) production. But OT agreements are not procurement contracts, and thus are not subject to the FAR, DFARS, or other procurement regulations or statutes. The Bayh-Dole Act (35 U.S. Code [U.S.C.] 201) on patent rights, does not apply, nor 10 U.S.C 2320 and 10 U.S.C. 2321 (the statutory underpinnings of the DFARS clauses).<br>
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OTA is an acquisition and contracting tool that is especially useful for introducing new or emerging technology and attracting performers that would ordinarily avoid or not consider federal government contracting opportunities. In order to sustain new technological advances and capabilities, rights in technical data and computer software deliverables must be negotiated properly. Some vendors with advanced capabilities already available in the commercial sector might not be willing to provide rights to the government because those vendors may have funded the research, development, and commercialization on their own dime. However, in an OT, everything is up for negotiation, including data ownership, license rights, delivery, markings, and even license rights in intellectual property (IP)—like patents. A deeper overview of key elements of the DoD approach to data rights may be found at <a href="/cop/IPDR/Pages/Default.aspx">https://www.dau.edu/cop/IPDR/Pages/Default.aspx</a>.<br>
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Emerging and innovative technology in a weapons system might be ripe for an OT agreement. Using an OT agreement to obtain the necessary and proper data delivery, license rights, and markings can be a match made in heaven for that weapons system. But special attention and critical thinking are crucial to address all those paramount issues in the agreement.
<h2>Interrelationship of OT and Data Rights</h2>
The DFARS provides uniform policies and procedures applicable for DoD to issue a solicitation and enter and perform a procurement contract. An OT agreement may “borrow” DFARS language when it facilitates reaching an agreement between the parties, but there is no requirement to do so. The DFARS language may offer some useful approaches but may not be understood by the commercial partners. The goal is to utilize terms and conditions that are understandable and acceptable to both parties. And, because DFARS does not apply, DFARS clause numbers should never be referenced in an OT agreement. Likewise, any DFARS terms used must be defined because the definitions in the DFARS provisions and clauses likewise do not apply. In essence, during an OT agreement negotiation, both parties sit at a table and “negotiate” what each party needs, classifying which specific deliverables, license rights, and business terms are needed and otherwise on the menu.<br>
If, for example, the OT agreement does not address the data deliverables and data license rights for the weapons system, the contractor is under no legal obligation to deliver the data or provide license rights to the DoD program office. If the OT agreement is successful, this could lead to “vendor lock”—a sole-source situation in which the DoD is locked into obtaining production, supplies, and services related to the weapons system from a single vendor. The costs for systems, spare parts, maintenance, training, and repair, obtained from a sole source likely will be higher than those obtained using competition because the sole source will not experience any competitive pressure. Inadequately addressing data deliverables and rights also could lead to system obsolescence. When a weapons system component no longer is viable, operation could continue without sacrificing viability if the government has the necessary data or software and rights to use competition in buying, manufacturing, or replacing the component through other sources or to “plug in” a different component.<br>
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A program office may find it difficult to achieve this objective if the OT agreement does not require the contractor to:
<ul>
<li>Develop the system and software architecture in accordance with Modular Open Systems Approach design principles to whatever Work Breakdown Structure level of indenture for subsystems and components the program’s Acquisition Strategy/Life Cycle Sustainment Plan states will be sustained through competition.</li>
<li>Deliver the three types of technical baseline data necessary to implement a “plug-and-play/talk” solution during the system’s life cycle.</li>
</ul>
<h2>Problem Statement</h2>
Since an OT agreement is not a procurement contract and the DFARS is not applicable, all statues, provisions, and clauses related to technical data and computer software rights and remedies are neither mandated nor automatically included in an OT agreement. This eliminates the DFARS protections for data rights for the DoD and introduces uncertainty for all parties, sort of similar to an engaged couple opting not to enter into a prenuptial agreement.
<h2>Risks and Opportunities</h2>
In the Program Management Office and the Contracting Office, every decision presents risks and opportunities, and OTs are no exception.<br>
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<strong>Risks</strong><br>
An OT agreement used in acquiring data rights could give rise to probems.
<ul>
<li>Potential vendors and a DoD program office have a blank sheet to negotiate data deliverables, license rights, and markings. This can make bargaining power very important. For example, the least advantageous and least flexible position for the program office would likely occur where a weapon system prototype is contemplated and accurately labeled as non-military technology or capabilities already found in the commercial sector. While new to the government, if this technology already exists in the commercial sector and has been developed with private funding, the government may have little leverage and therefore may be unable to obtain data or rights. However, the program management office could retain flexibility and succeed by negotiating with a vendor and offering something of value, such as access to government labs or test facilities. Robust competition is the best form of leverage in this kind of scenario.</li>
<li>OT agreements have no default terms to address the data and data rights required to sustain a weapon system. In other words, each OT agreement is unique, and therefore its data deliverables and license rights should be tailored to the specific agreement. Failure to properly assess and agree on the data deliverables, license rights, and data markings could lead to the DoD not receiving the data or software it needs or, failing to receive the appropriate rights, place the DoD in a source-sole environment for follow-on awards. Again, this could prove extremely costly and inefficient.</li>
<li>Data marking can differ from the standard DFARS data right markings. The OT agreement should define all potential markings on the data and computer software deliverables (both noncommercial and commercial).</li>
<li>Critical terms such as “development” must be defined and the implications of those terms agreed upon—e.g., whether development considers the lowest component level, and whether there are potential impacts on rights based on which party funded development.</li>
<li>The agreement should consider as many contingencies as possible, addressing aspects such as the rights in data if a vendor does not perform, goes out of business, or sells to another company.</li>
<li>Not defining the data-related terms or modifying terms of art could be disastrous. As examples, using DFARS terms such as Government Purpose Rights, Form Fit and Function, and Operation, Maintenance Installation and Training, without specifying the definitions, could lead to disagreements and disputes during performance.</li>
</ul>
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<strong>Opportunities</strong><br>
An OT agreement for acquisition of data rights has certain advantages.
<ul>
<li>It provides small business or nontraditional defense contractors an opportunity to obtain DoD contracts without agreeing to all FAR and DFARS requirements.</li>
<li>Both the vendor(s) and the DoD program office have the opportunity to negotiate all agreement terms, including data license rights and markings. The parties could negotiate a follow-on production contract such that the awardee undertakes an obligation of supporting a weapons system for “x” number of years. After this timeframe, the weapon system sustainment could be competed by allowing the DoD to make all data available to other vendors.</li>
<li>It provides flexibility for the DoD to obtain and vendors to provide varying degrees of data and license rights from one OT agreement to the next. In a perfect government-technology marriage, for example, the government could negotiate rights to allow the government as a whole to utilize the technology in an open and fruitful manner. For instance, if the U.S. Air Force negotiates for innovative cyber advances to better protect Air Force systems, the best position would be to obtain the rights for any U.S. Government agency to use, modify, reproduce, release, or disclose the technical data or computer software with limited or no restrictions. With these types of rights, the U.S. Navy, U.S. Army, or any other U.S. Government entity could fully leverage this technology for similar purposes. Less ideally, vendors may not want to provide the government such robust rights to proprietary software or technology. However, if the government supports the development by contributing financially or providing assets such as a lab or subject-matter expertise, the government has more leverage to obtain data and license rights. This likewise could prove lucrative for vendors who may not have engaged previously with the government, and could potentially prove enticing to small businesses that otherwise would not have access to benefits such as use of government labs.</li>
<li>It allows negotiation of mutually beneficial arrangements, such as incentivizing a contractor to provide more data and greater rights in order to obtain more funding.</li>
<li>It allows the DoD to negotiate an agreement that implements data rights in interfaces and other deliverables required for Modular Open System Architecture.</li>
<li>It enables the negotiation of agreements that react to a changing marketplace and changing requirements. Digital engineering and model-based deliverables are becoming more widely used throughout the DoD and by commercial vendors to conduct engineering and testing activities. For example, the B-52 Program Office employed an OT agreement for selecting and engaging with a commercial engine manufacturer for the B-52 commercial engine replacement program, which has implemented digital engineering.</li>
<li>It provides flexibility to tailor data deliverables and license rights requirements to the particular needs of both parties to the agreement. Where commercial technology has been fully developed by a vendor, the government may receive extremely limited data deliverables and minimal rights. In a procurement (i.e., FAR-based) environment, this might not be permissible under the mandatory data rights clauses. However, in an OT agreement, the government could obtain the best technology possible by forgoing rights that a contractor is unwilling to grant. In some OT agreements, the government might not be interested in data rights, especially in areas so advanced or nuanced to a specific industry, or where the government is merely interested in proving capability. On the other hand, OTs also would allow a nontraditional vendor new to government business to offer a greater data rights license for government work and thereby gain access to a new, major customer.</li>
</ul>
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<strong><img alt="" src="/library/defense-atl/DATLFiles/Sept-Oct_2020/DefAcq_Sep-Oct2020_article03_figure02.jpg" style="margin-left:3px;margin-right:3px;float:left;width:488px;height:200px;" /></strong>Some areas, however, present similar issues in the OT domain as those found in the realm of the FAR and DFARS. Commercial software licenses, for example, pose risks that could trigger issues in either type of agreement. Many commercial licenses have renewal clauses that automatically extend a period of performance—and payment obligations—at the end of the previously agreed upon term. In both a government OT agreement and a procurement contract, statutes and regulatory restrictions unrelated to acquisition matters generally still apply. For instance, fiscal law rules still apply to OTs, so that, under the Anti-Deficiency Act, automatic renewals commonly provided for in commercial software licenses could trigger a violation if they obligate funds not yet appropriated.
<h2>Applying Data Rights to OT</h2>
There are three basic pathways to negotiating data, data license rights, data markings, and data delivery in an OT: (1) adapt the language and concepts from the DFARS; (2) leverage commercial marketplace rights customary to what is being bought; or (3) negotiate from a blank piece of paper. Figure 2 depicts the potential pathways with an OT, but there is no “best” pathway since each approach is specifically tailored. The program management office subject-matter experts working with the agreement’s officer (with an OT agreement, an agreements officer is required; not a contracting officer) should determine the best pathway for the specific program. For speed, but with limited tailoring, Pathway No. 1 could be the best approach. For greater flexibility and new, innovative approaches to data and rights, Pathway No. 3 may be the best approach.<br>
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Generally, in OTs, use of “procurement” terms (meaning FAR or DFARS terms) is discouraged. The rationale is to attract commercial performers to work with the government by neither using government-unique phrases nor asking the performers to change their commercial terms to accommodate the government. The November 2018 DoD Other Transactions Guide emphasizes the importance of agreements officers understanding the statutes underlying the government’s rights in patents (the Bayh-Dole Act, 35 U.S.C. 201) and data (10 U.S.C. 2320) while emphasizing that these statutes do not constrain OTs. Since every OT is unique, agreements officers should start with those fundamental concepts and tailor data deliverables and license rights to what the government is buying and to the particular business situation.<br>
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The second option, leveraging commercial marketplace rights, may be the most expeditious path to an agreement, but beware of red flags (similar in significance to your spouse asking you to attend marriage counseling). For instance, the government can only agree to federal jurisdiction, meaning only federal laws apply. However, many commercial vendors include state laws and choice of a state jurisdiction for any disputes in their agreements. There also are other standard clauses and terms vendors may habitually include in commercial agreements to which federal entities cannot agree—such as the previously discussed issues with automatic renewals. So it is important to be cautious in utilizing commercial language.<br>
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Finally, the most tailored approach is to negotiate the agreement, including data and license rights, from a blank piece of paper. While this may be the most time-consuming approach upfront, it could ensure that the rights and deliverables are structured narrowly to the item or services at hand, are relevant, and best meet the needs of both parties. If this is the desired approach, however, it may be prudent to begin as early as practicable so that the data rights negotiation does not unduly delay the OT agreement. The agreements officer always should keep in mind that the basic foundation of FAR and DFARS data rights is to inform business decisions even if the parties are working from a blank slate.
<h2>OT Agreement Example and Lessons Learned</h2>
In the Naval Operation Business Logistics Enterprise (NOBLE) OT agreement, the Navy generally utilized the DFARS data rights language to protect its interests. However, where commercial data were privately funded the Navy accepted very minimal rights. The Navy also yielded benefits from identifying each component at the lowest possible level, as well as identifying version numbers for software. Where a vendor exclusively funded software version 1.0, for instance, the government accepted a low level of rights to use and disclose that software. However, where both parties financially contributed to development of version 2.0, the government reasonably expected to obtain the equivalent of Government Purpose Rights.<br>
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Successfully negotiating data, data license rights, and data markings within an OT agreement requires a team effort from each functional area within the program office. The agreements officer cannot perform this task alone. The logistician knows what data deliverables are required to sustain the weapon system—and the required data license rights. The software engineer will know what noncommercial computer software (source code/executable code) must be delivered to maintain and update the software for the weapon system’s life cycle. And the program and data rights attorneys will be mindful of legal considerations, such as potential Anti-Deficiency Act violations, as well as risks and rewards from obtaining data and rights.<br>
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Premarital counseling may help identify potential causes of strain in an impending marriage. In the same way, a beneficial approach to researching appropriate data rights in an OT environment may be to engage in a focused “industry day” to communicate to industry the government’s requirements for data deliverables and license rights. This could further allow industry to proffer vital input and ideas on how to provide the necessary and proper data and rights based on the program management office life-cycle requirements and specific industry practice.<br>
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The OT agreement also should address both commercial and noncommercial data delivery in a clear format. While the data rights could be negotiated correctly within the OT agreement, problems likely will arise if no language directs the contractor how to deliver the necessary and proper data to the DoD and to whom to deliver it. This risk could appreciably materialize if the vendor is a nontraditional vendor unfamiliar with government contracts.
<h2>Where to Find Assistance</h2>
The Under Secretary of Defense for Acquisition and Sustainment issued the Other Transactions Guide in November 2018 to provide “advice and lessons learned on the planning, publicizing, soliciting, evaluating, negotiation, award, and administration of OTs.” While this is not a step-by-step or “how-to” guide for data rights negotiation in an OT environment, it provides an excellent baseline for key considerations.<br>
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Moreover, the Defense Acquisition University can provide tailored workshops to assist the program management offices and agreements officer on data deliverables, data rights, and data markings in an OT agreement.
<hr />Balkin has been supporting Department of Defense contracts and acquisitions for 10 years. She specializes in litigation and agile contracting and nontraditional methodology. Harris is a professor of Program Management at the Defense Acquisition University. He has more than 20 years of program management experience.<br>
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The authors can be contacted at <a class="ak-cke-href" href="mailto:hallie.balkin@dau.edu">hallie.balkin@dau.edu</a> and <a class="ak-cke-href" href="mailto:howard.harris@dau.edu">howard.harris@dau.edu</a>.</div> | string;#/library/defense-atl/blog/“A-Marriage-Made-in-Heaven” | | | | | | | |
