A venture capital mixed model for the acquisition of defense software products

Abstract

The major problem in the Department of Defense's acquisition of software systems is the growing number of cost and schedule overruns that result in failed software acquisitions. Cost and schedule overruns are the consequence of the software development models selected, inaccurate estimation of size, time, and cost, the instability of user requirements, and poor decision-making by acquisition managers. Commercial practices of requirements definition, vendor selection, development process, business practices, integration, development, and testing, maintenance, and rights in data were compared with equivalent Department of Defense practices. Commercial solutions are the implementation of open source standards and architectures, iterative software developments, increased collaboration among competing vendors, and the incorporation of software reuse. The Department of Defense's non-profit venture capital models utilize key practices, such as deal syndication and incremental funding, which are instrumental in managing risk and could be incorporated into how the DoD acquires software.