Every fiscal year Navy Resource Sponsors are responsible for producing a Sponsor Program Proposal (SPP) or framework for funds that will be requested in the President’s budget in two years. The SPP must adhere to guidance issued by Office of the Secretary of Defense and the Department of the Navy. The 2011 Chief of Naval Operations Surface Warfare Directorate (N86) SPP, which will influence the 2013 President’s Budget, presented serious programming challenges to the recapitalization and modernization accounts and to the delivery of future warfighting capability and capacity.
Kratos professionals, as part of the N86 Surface Warfare team, were challenged to build and manage the Program Objective Memorandum (POM)-2013 SPP which encompasses Total Obligation Authority (TOA) of about $60 billion across the Future Years Defense Program (FYDP) and management of 120 programs. Team members were directed to identify programmatic offsets of $1.8 billion to absorb TOA adjustments that were made to the 2012 President’s budget. In addition, offsets of $1.3 billion had to be identified to account for unfunded issues. In total $3.1billion in offsets had to be identified, vetted, managed and ultimately reprogrammed. This task requires technical, operational and organizational knowledge of the process and the people necessary to bring the task to completion. The 14 years that Kratos has supported N86 and gathered institutional knowledge make the team successful in the tight timeframes necessary to bring the POM cycle to completion.
In order to build a balanced SPP and to minimize version control mistakes, one Kratos Branch Financial Manager (BFM) was given responsibility over the SPP build with Government oversight. Kratos’ BFM spent countless hours, consulting and involving multiple offices and departments across various Navy Staffs and the budget submitting office (N8F). Kratos’ BFM began the SPP build process by first categorizing each issue as either: War fighting Capability, Capability Enhancement, Program Wholeness, Program Health, Building New Construction, Above Core or Offset. All potential offsets had to be first identified and impact statements written. A dualie (chart with five sections) was created for each issue that described the issue, funding, warfighting capability, level of congressional visibility, and corresponding funding issues involving other Navy departments. Investments which were deemed relevant and critical capability requirements were identified; offsets were put in order of priority for potential buyback, should additional funds become available; analyses were done to determine impacts to programs before funds were reprogrammed; new emergent POM-13 efficiencies and funding responsibilities were identified; and courses of actions and program recommendations were made to the N86 Resource Sponsor.
Kratos’ BFM built a detailed and meticulously formatted SPP, which was recognized and received compliments from several Navy Flag Officers within the Pentagon. The N86 Resource Sponsor delivered to N8F a balanced budget in their initial SPP POM-13 submittal, which allowed Senior Navy Leaders to make critical programmatic decisions and influence the Navy’s POM-13 budget.