Pursuant to a congressional request, GAO discussed issues the Department of Defense (DOD) faces in its acquisition of weapon systems.

GAO noted that: (1) the pressures of competing for the funds to launch and sustain a weapon system program create incentives for starting programs too early; overpromising performance capabilities; and understating expected costs, schedules, and risks associated with developing and producing the weapon; (2) leading commercial firms have adopted a knowledge-based approach to developing new products that embodies incentives that encourage realism, candor, and meeting product expectations; (3) making sure that new technology is mature--that is, demonstrated that it works--is the foundation for this approach; (4) DOD's variances from best commercial practices result in higher costs, compromised performance, and questionable cost benefit approaches; (5) a knowledge-based approach can be used to reshape DOD's acquisition process; (6) by itself, such a process will not produce better program outcomes unless it influences the decisions made on individual weapon systems; (7) if a knowledge-based acquisition process is put in place and used, there are potential benefits that transcend individual program outcomes; and (8) specifically, the ability to execute a program more predictably within cost and schedule estimates would lessen the need to offset cost increases by disrupting other modernization programs.