The Department of Defense is preparing to implement major changes to how it buys weapons and technology as part of a push to promote competition, reduce bureaucracy and expedite the delivery of capabilities to warfighters, Breaking Defense reported Tuesday.
“Every process, board and review must justify its existence by demonstrating how it accelerates capability delivery to meet warfighter needs,” according to a draft memo obtained by Breaking Defense. “Speed to capability delivery is now our organizing principle: the decisive factor in maintaining deterrence and warfighting advantage.”
The six-page document, first reported by Politico, comes just days before Defense Secretary Pete Hegseth, a 2025 Wash100 awardee, is set to address defense CEOs and senior acquisition leaders on Friday. His remarks are expected to focus on acquisition reform, though it remains unclear whether he will announce the changes publicly.
What Is the Pentagon’s Portfolio Acquisition Executive Model?
A centerpiece of the plan is replacing the traditional program executive office structure with new portfolio acquisition executives, or PAEs. These officials will oversee multiple related programs, shifting resources across systems to prioritize on-time delivery. PAEs will serve at least four years and have their performance tied to metrics like delivery speed, competition and mission outcomes.
The memo gives PAEs authority to make cost and performance trade-offs that favor rapid fielding. Each military service will have 60 days to propose its initial portfolios, with a full transition to the new model expected within two years.
Implementing ‘Commercial First’ Contracting
DOD also plans to advance commercial and alternative contracting pathways. Within 90 days, guidance will be issued to expand use of other transaction authorities and commercial solutions openings, encouraging faster partnerships with private industry and startups.
The DOD 5000 acquisition policy will be updated within 150 days to delegate authority to the services, simplify reviews and consolidate milestones.
Portfolio Scorecards
To ensure accountability, the memo calls for portfolio scorecards to track the performance of acquisition portfolios. Within 180 days, DOD should publish scorecards containing “primary measures” that evaluate prototypes, delivery schedules, production ramps and initial operational capability.
Contracts will include “time-indexed incentives,” rewarding early delivery while proportionally penalizing delays.
The document also mentions a new Economic Defense Unit that will develop modern contracting models and deploy capital to defense technology firms through loans, grants and other investments.
