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A framework for de-risking and growing existing defense programs
Defense industry executives face a familiar pressure to win the next program. New business captures headlines, earns internal recognition, and signals organizational momentum. But this emphasis on winning new programs can obscure a more fundamental driver of long-term success, which is the health of programs already in hand.
BCE has developed a framework for assessing and growing existing defense programs. It is built around six dimensions of program health, each of which can be tracked, scored, and used to guide resource decisions. Used consistently, the framework gives leadership an early warning system for programs at risk and a structured basis for investment decisions across the portfolio.
Below we explain some of the assumptions that often lead organizations to underinvest in existing programs and how a structured approach to assessing program health can minimize risk and generate long-term sustainable growth.
The Assumptions That Create the Problem
Several implicit beliefs tend to shape how defense organizations think about growth. They are rarely written down, but they consistently influence strategy, resource allocation, and culture.
“You have to win the business before you can lose it.”
The logic here is compelling. Even if a program eventually underperforms, at least the revenue did not go to a competitor. In practice, this mindset encourages the pursuit of low-probability bids and can justify portfolios of questionable quality. Large prime contractors with deep financial reserves can occasionally absorb this kind of risk. Most organizations cannot, and even for the largest firms, it is not a sound basis for growth strategy.
“Superior technology will carry us through.”
Technology matters in defense competitions, but it is only one factor. By the time a formal solicitation is released, outcomes are often already shaped by earlier customer engagement, relationship development, and alignment with operational priorities. Organizations that lead with technology and assume the rest will follow are frequently surprised by the results.
“Winning new programs is how we grow.”
New program wins are a component of growth, but it can take a decade or more before they become a meaningful contributor. If existing programs are eroding in the meantime, net growth is illusory. Worse, when a declining program becomes an organizational embarrassment, leaders sometimes choose to let it go rather than invest in a difficult recovery, sacrificing long-term strategic value in the process.
The On-Program Growth Framework
The BCE On-Program Growth Framework assesses program health across six dimensions, each reflecting a distinct category of risk or opportunity. Together they provide a complete picture of where a program stands and where it is heading.
1. Strategic Alignment
Programs that survive and grow are consistently connected to real and evolving customer needs. This means understanding geopolitical trends and regional security environments, mapping those needs to existing products, including through product improvement programs, and anticipating policy shifts that influence procurement priorities. The quicker a firm can identify changing warfighter needs, the better positioned it is to shape requirements in its favor. This alignment requires regular reassessment.
2. Relationship Depth and Breadth
A program that engages only the contracting officer is vulnerable. One that has developed genuine partnerships across the sponsor community, operational users, the acquisition organization, and the funding community, is in a much stronger position.
The most resilient programs go further: they integrate these stakeholders into pre-planned product improvements (P3I), readiness enhancements, and cost reduction, creating mutual investment in the program’s future and ensuring relevancy as customer needs evolve. That level of customer intimacy is difficult to displace.
3. Funding Visibility
The health of a program’s funding profile is one of the clearest leading indicators of its future. Warning signs include production funding absent from the Program Objective Memorandum (POM), no investment in product improvement alongside production, or congressional marks that reduce allocated funding. Positive indicators include plus-ups, operational commander advocacy, and multiyear procurement authority. Tracking these signals systematically gives leadership time to plan and pivot.
4. International Strength
A strong international footprint dramatically improves a program’s survivability. Multiple international Foreign Military Sales customers, approved Direct Commercial Sales programs, and export licenses across multiple countries each reduce dependence on any single domestic budget cycle. Joint multinational programs go further by creating program dependencies across governments. The strongest programs include international customers in R&D, production, and maintenance. With OCONUS customers investing more in defense and requiring even greater levels of partnership, these shared programs will only become more important. Leaders should continually reassess the strength of their international relationships as regional dynamics shift.
5. Forecast Realism
Internal five-year plans should be compared regularly against the DoD’s Program Objective Memorandum. When IRAD, production, and O&M projections fall significantly below POM levels, or when they are unrealistically optimistic relative to funded programs, leadership is operating without an accurate picture of program health. Disciplined, honest forecasting is a strategic exercise as much as a financial one.
6. Displacement Risk
A significant shift in USG acquisition strategy is now a material factor in program health assessment. Growing segments of defense spending are moving toward firm-fixed-price, industry-funded development — a model that structurally advantages privately funded firms who can absorb upfront development risk and capture higher margins on the back end. Traditional defense contractors, whose business models were built around cost recovery and regulated profit, face a structural disadvantage. Every established program should be assessed for its vulnerability to displacement by well-capitalized entrants operating outside legacy cost structures.
Applying the Framework
The framework is designed to be used as an annual review process applied consistently across the portfolio. For each program, leadership scores each of the six dimensions and produces a single consolidated view of program health.
The output serves two purposes. First, it provides an early warning system. Programs rarely fail suddenly, when Congress takes the funding away on a Friday night, it may seem that way; they send signals over time that, if tracked consistently, allow for earlier intervention. Second, it creates a structured basis for investment decisions about where to direct BD resources, where to accelerate relationship development, where to invest in product improvement, and where to begin a more fundamental reassessment of a program’s long-term viability.
The framework is not a substitute for judgment, but rather a structure that surfaces the right questions, calibrates assumptions, and supports decisions that can be explained clearly to leadership and stakeholders. The most valuable output is often not the scores themselves, but the conversations they generate.
Extension to New Business Development
The disciplines embedded in this framework apply equally to new business development, and organizations that build these habits on existing programs will find they become better at winning new ones.
New programs should be pursued based on genuine understanding of warfighter priorities, not available solicitations. Early-stage customer engagement and solution development consistently outperforms reactive pursuit of late-stage opportunities. Total ownership cost, beyond just procurement price, should inform both pursuit decisions and proposal strategy. This ensures that limited resources are applied most efficiently and effectively.* And not every competition is worth entering; the evaluation should extend beyond the probability of winning to whether the program, if won, has a credible path to becoming a healthy production business.
Acquisition cultures also vary considerably across the services, and across communities within the services. Understanding those differences and adjusting investment and engagement strategies accordingly is part of the same competitive discipline that the framework instills on existing programs.
*NOTE: BCE has developed a structured DOTMLPF-P Cost Implication framework to help clients understand true total lifecycle costs, which clients have found very useful and effective in discussions with the end-customer.
Closing Thought
The organizations that grow most reliably in the defense industry are often the ones most disciplined about protecting what they have already built. New business development and existing program stewardship are not competing priorities. A business that does both well, with a consistent framework applied across the portfolio, is a business that can sustainably grow.