Total Package Procurement

Total Package Procurement (TPP or alternatively TPPC) was a major systems acquisition policy introduced in the United States Department of Defense in the mid-1960s by Secretary of Defense Robert MacNamara.^[1] It was conceived by Assistant Secretary of Defense for Installations and Logistics, Robert H. Charles.^[2]

Six Spruance-class destroyers fitting out in 1975; this class of warships was ordered under the Total Package Procurement policy

TPP involves combining as a single package for the procurement a number of related requirements including the design, development, production and support of major systems.^[3] This concept was a "pendulum reaction" to the prior cost reimbursement policies in major weapon systems.^[4]

Total Package Procurement was not successful and was abandoned shortly after MacNamara left office.^[5][6]

Description

TPP is a method of procuring at the outset of the acquisition phase under a single contract containing price, performance and schedule commitments, the maximum practical amount of design, development, production and support needed to introduce and sustain a system or component in the inventory.^[3]

The purpose of TPP was to procure under the influence of competition as much of the total design, development, production and support requirements for a system or component as may be practicable thereby:

• Providing firmer 5-year force structure program package planning information concerning performance cost and schedules.^[3]
• Discouraging contractors from buying in on the design and development effort with the intention of recovering on the subsequent production program.^[3]
• Permitting program decision and source selection based on binding performance price and schedule commitments by contractors for the total program or major part of it.^[3]
• Providing a firmer basis for projecting total acquisition and operational costs for use in source selection and in the determination of appropriate contractual incentives.^[3]
• Motivating contractors to design initially for economical production and support of operational hardware which may not receive sufficient emphasis in the absence of productions commitments.^[3]
• Requiring contractors to assume more responsibility for program success thereby permitting the Government to monitor programs more in terms of surveillance and less in terms of detailed management.^[3]

Results

Total Package Procurement did not succeed.^[5] The unique complexity of shipbuilding made Total Package Procurement particularly inappropriate for these programs.^[5]

Notable programs that encountered major problems with the TPP approach were the Air Force's Lockheed C-5 Galaxy^[1] and AGM-69 SRAM,^[7] the Army's Lockheed AH-56 Cheyenne,^[7] the Tarawa-class amphibious assault ships (LHA),^[5] and the Spruance-class destroyers.^[5]

Elimination

Upon taking office as Deputy Secretary of Defense in 1970, David Packard issued a May 28, 1970 memorandum that contained a number of major reforms designed to address "the real mess we have on our hands." A key reform was elimination of TPP except in rare situations.^[6]