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The United States Navy and other military services send a large number of their officers to various military universities to obtain graduate degrees or perform academic research. These graduate education programs provide the officers with technical skills and nontechnical competencies highly valued in their respective billets. The cost of sending a Navy officer to a 1.5- to 2-year program for a master's degree may be upwards of $250,000 plus the opportunity cost of his or her lost services. In addition, a doctoral program may cost upwards of $500,000 per officer, plus their respective soft opportunity costs for being away for 3-4 years. The U.S. military's human resource environment is unique in that it is a closed internal hierarchical structure. For instance, an officer's pay is based on his or her rank and years of service, regardless of educational background. It can be argued that higher education may result in higher efficiency and productivity, thereby increasing the speed of promotions, but these are fairly difficult to quantify. Further, we see that 2 years after graduation, the retention rates are relatively high, ranging from 99.31% to 95.78% on average. This high rate of retention the first few years is to be expected as officers sent to graduate programs typically are required to "pay back" their education costs with guaranteed service for several years. The question is whether the benefits of such education and research are indeed greater than the cost incurred by the Navy. Another consideration is that naval research and education are not separate tasks but tend to coexist alongside the innovation engines of the country. The current research looks at various novel ways to value the monetary return on investment (ROI) of military education and research. The proposed methodologies apply theoretical constructs by using a systems approach to utilization; convolution methods to determine the frequency and quantity of use; and an analytical framework, empirical impact analysis, and work lifecycle approach, combined with integrated risk management and knowledge value added methodologies to determine and run Monte Carlo simulations of the model inputs, as well as to provide guidance and information to decision makers with respect to the optimal portfolio allocation of resources to educational activities. The research also includes an examination of three short case studies: one on the value of military research in the Naval Acquisitions Research Program, a second case study on the value of a naval university such as the Naval Postgraduate School (NPS) in Monterey, California, and a third case on the Defense Acquisition University. The research findings indicate that there is a statistically significant positive impact on retention of graduating officers, lower attendance cost, and greater DoD control of the courses covered. In fact, the ROI for military-based academic research ranges between 240% and 600%, while graduate education at a military university such as NPS yields an ROI between 469% and 673%. The courses at the DAU have an average ROI between 411% and 477%, and the probability that, on average, any given course taken at the DAU has at least a 93% probability that the ROI is positive for an organization. The global average ROI for various military education is estimated to be about 485%, which means that for every $1 spent on education, the benefit gained by the government is $5.85. These ROI are above and beyond the significant intangible value of military officers studying a military-specific curriculum and learning from each other as well as from retired military faculty. Finally, we also conclude that military organizations tend to value the ROI to an employee's personal career growth as being the same as the ROI to the entire organization, where the ROI of a training initiative goes well beyond its sole impact on an employee's job performance where the value add might be intrinsic, unmeasurable, and subjective, rather than simple applications of specific knowledge or learned skill set on the job.

17 USC 105 interim-entered record; under review. The acquisition of artificial intelligence (AI) systems is a relatively new challenge for the U.S. Department of Defense (DoD). Given the potential for high-risk failures of AI system acquisitions, it is critical for the acquisition community to examine new analytical and decision-making approaches to managing the acquisition of these systems in addition to the existing approaches (e.g., Earned Value Management, or EVM). Also, many of these systems reside in small start-up or relatively immature system development companies, further clouding the acquisition process due to their unique business processes when compared to the large defense contractors. This can lead to limited access to data, information, and processes that are required in the standard DoD acquisition approach (i.e., the 5000 series). The well-known recurring problems in acquiring information technology automation within the DoD will likely be exacerbated in acquiring complex and risky AI systems. Therefore, more robust, agile, and analytically driven acquisition methodologies will be required to help avoid costly disasters in acquiring these kinds of systems. This research identifies, reviews, and proposes advanced quantitative, analytically based methods within the integrated risk management (IRM) and knowledge value added (KVA) methodologies to complement the current EVM approach. Naval Postgraduate School

17 USC 105 interim-entered record; under review. As technology continues to move forward and a continued emphasis is placed on construction of large ships and submarines, there is another possibility. That is to construct a third tier of small combatants that project power from the sea in contested environments and employ a “shoot first” backed by a “second salvo.” These vessels would be constructed based on the lessons learned from automation of the medium unmanned surface vessel (MUSV) Sea Hunter, in which most ship functions and basic navigation would be automated. The new vessel, called Sea Fighter, would have a crew of 15 and have a single combat mission: to deliver long-range precision weapons and distribute secondary combat functions among the pack of Sea Fighters and Sea Hunters. An analysis of total ship costs is applied in a simulation and comparison to other vessels. The simulation is transportable and can be reused to help determine the best possible vessel for this task.

Naval Postgraduate School Acquisition Research Program

Naval Postgraduate School Acquisition Research Program

This research has the explicit goal of proposing a reusable, extensible, adaptable, and comprehensive advanced analytical modeling process to help the U.S. Department of Defense (DoD) with risk-based capital budgeting and optimizing acquisitions and programs portfolios with multiple competing stakeholders while subject to budgetary, risk, schedule, and strategic constraints. The research covers topics of traditional capital budgeting methodologies used in industry, including the market, cost, and income approaches, and explains how some of these traditional methods can be applied in the DoD by using DoD-centric non-economic, logistic, readiness, capabilities, and requirements variables. Portfolio optimization for the purposes of selecting the best combination of programs and capabilities is also addressed, as are other alternative methods such as average ranking, risk metrics, lexicographic methods, PROMETHEE, ELECTRE, and others. Finally, an illustration at Program Executive Office Integrated Warfare Systems (PEO IWS) and Naval Sea Systems Command (NAVSEA) is presented to showcase how the methodologies can be applied to develop a comprehensive and analytically robust case study that senior leadership at the DOD may utilize to make optimal decisions. Naval Postgraduate School Acquisition Research Program

This study examines five advanced decision support methodologies, Lean Six Sigma (L6?), Balanced Score Card (BSC), Integrated Risk Management (IRM), Knowledge Value Added (KVA), and Earned Value Management (EVM), in terms of how each can support the information technology (IT) acquisition process. In addition, the study provides guidance on when each methodology should be applied during the acquisition lifecycle of IT projects. This research includes an in-depth review of each methodology in the context of the acquisition lifecycle. All acquisition projects within the DoD must go through the acquisition lifecycle. While each acquisition project is unique, all must pass a series of common hurdles to succeed. Understanding how and when the methodologies can be applied to the acquisition of IT technologies is fundamental to the success of any IT acquisition. The study concludes with a set of recommendations for the use of each methodology in the acquisition lifecycle of IT projects. Naval Postgraduate School Acquisition Research Program

The current global security environment is changing at a faster pace than ever before with higher levels of complexity and competitiveness, with a complex dynamic of possibilities. The U.S. Navy not only needs more platforms or ships, but it needs them with the ability to adapt to changes with new technologies and operational concepts. One such concept is that of flexibility in our fleet of ships. To successfully implement the Surface Navy’s Flexible Ships concept, PEO-SHIPS requires a new methodology that assesses the total future value of various combinations of Flexible Ships’ design features and how they will enable affordable warfighting relevance over the ship’s full-service life. Examples of Flexible Ships design features include decoupling payloads from platforms, standardizing platform-to-payload interfaces, implementing allowance for rapid reconfiguration of onboard electronics and weapons systems, preplanning access routes for mission bays and mission decks, and allowing for sufficient growth margins for various distributed systems. This research analyzes the application of strategic Real Options Valuation methodology within the Integrated Risk Management process to assess the total future value of Flexible Ships design features and for use in the Future Surface Combatant Analysis of Alternatives. The current research has the explicit goal of proposing a reusable, extensible, adaptable, and comprehensive advanced analytical modeling process to help the U.S. Navy in quantifying, modeling, valuing, and optimizing a set of ship design options to create and value a business case for making strategic decisions under uncertainty. Naval Postgraduate School Acquisition Research Program