FORT GREGG-ADAMS, Va. –
Creating the Defense Contract Management Agency in 2000 was the boldest and most effective step in seeking efficiency in defense acquisition in more than two centuries.
Before the establishment of the Defense Contract Management Command, DCMA’s precursor command, 24,000 people from 144 organizations managed U.S. defense contracts. Today, most of that work is done by just over 10,000 people working for a single three-star agency, providing contract administration services for the Defense Department, other federal agencies, foreign governments and international organizations.
DCMA relentlessly refines itself with one mission focus — providing the equipment necessary for service members to fight, survive and win on the battlefield. Even as the agency enters its second quarter century, it is midway through another internal reorganization that promises even better support in tomorrow’s world.
Long History of Contract Support
From the appointment of the first quartermaster general in 1775 by George Washington and the first law regulating federal procurement passing Congress in 1792, contracting has played an important, evolving role in our nation’s history.
After 200 years of conflict and war — from the American Revolution through World War II — the need to consolidate and control the vast and growing facets of procurement to deliver products and services effectively became evident.
Amid the Cold War, manned space travel and major technological developments in the 1960s, management of DOD contracts surged to record levels. With this came the realization that the department’s numerous procurement systems, housed within branches of the services, were ill-equipped to contend with a rapidly increasing new generation of contracts without the resulting duplication, excessive operating costs or lack of timely delivery to the end user — the warfighter.
In response to these concerns, the Office of the Secretary of Defense established Project 60, a structured and systematic effort to define and improve DOD’s contracting processes. Almost three decades of studies, projects, reports and congressional testimony followed. The most significant result was the 1989 recommendation to establish a stand-alone agency to administer contracts and a task force to bring all contract administration services under the new organization.
Initially, this new agency launched as a command under the Defense Logistics Agency called the Defense Contract Management Command, established in 1990. After 10 years of demonstrating its agency-level capability, DCMC was ready to fulfill Project 60’s original vision and become independent.
On March 27, 2000, Deputy Secretary of Defense John Hamre signed a memo establishing the Defense Contract Management Agency, consisting of “all personnel and resources of the former DCMC, including 12,539 full-time equivalents.” A letter to Congress explaining the decision underscored efficiency and stated DCMA’s creation was “intended to reduce the overall requirement for management headquarters and will ultimately reduce the personnel requirements associated with these two critical functions (contract management (DCMA) and logistical management (DLA)).”
Today’s Mission: DCMA Vision
DCMA has championed two consistent threads throughout its 25 years. First, the agency delivers on its mission. In fiscal year 2024, DCMA professionals delivered more than 312 million items to our military services, worth more than $81 billion. This includes 339,090 missiles and rockets, 6,054 combat vehicles, and 8,444 flight hours to deliver 399 aircraft. For the ninth year in a row, the agency did so with a positive return on investment, averaging a return of $3.20 for every dollar budgeted since September 2015.
Second, DCMA continually refines itself, ingraining improvement and efficiency into every business function and decision. The constant honing is born of two driving forces, chief being the ever-changing landscape of threats and requirements of DOD customers. The world looks very different today than it did in 2000. The terrorist attacks of 2001 sharply refocused our national defense efforts.
Cyberattacks, improvised explosive devices, drones and other threats present challenges unknown in the last millennia. Our military must be more flexible than ever, and industry as well, with new technology and processes introduced at an unprecedented rate.
The second driving force for DCMA is its critical understanding of the defense dollar. The agency performs a dynamic mission within a fixed budget — 87% of which is dedicated to payroll. To maintain its edge and help customers get the most out of their budgets, DCMA has to perpetually develop its highly skilled workforce. Budget realities require this workforce to be as focused and efficient as possible.
Fortunately, advances in technology are on DCMA’s side. In 2020, COVID-19 forced a hard look at how and where the agency’s functional specialists do their job. Along with many in the federal government, the agency initially leveraged telework technology to continue its mission. This success freed DCMA to examine its overall organizational structure, leading to a new vision. Employees returned to newly realigned offices, carefully designed to more closely match the structure of the military services, buying commands and program offices, closing communication gaps and injecting efficiency into the greater acquisition process.
The pandemic also reinforced DCMA’s importance in assuring the health and viability of the defense industrial base. While many employees initially teleworked, a large cadre of agency professionals continued critical visits to contractor locations. This uninterrupted access and proximity were leveraged as part of the whole-of-government response to COVID, ensuring not only our national defense posture but also assisting in the coordination and distribution of test kits and other essential items. Today, DCMA administers contracts at more than 17,000 contractor locations, giving the agency unmatched access to industry, and ideally positioning it to support Secretary of Defense Pete Hegseth’s priority of rebuilding our military by reviving the defense industrial base, reforming acquisition process, and rapidly fielding emerging technologies.
Future of Contracting
By the end of its 25th year, DCMA anticipates being broadly transformed, with two large commands covering defense contract administration in the continental U.S., a third command for international work, and a refined slate of focused components providing specialized work and support.
Today, DCMA professionals — 9,811 civilians and 519 military service members — administer more than 302,846 contracts valued at nearly $5.9 trillion, delivering millions of products a year to our military and authorizing about $1 billion in contractor payments every business day.
Tomorrow, the total value of contracts will likely continue to rise, just as their complexity and criticality will rise. DCMA will keep refining itself and reinvesting in its people. At its 50th anniversary the data points will have changed, but the results will be the same — mission success.
Editor’s Note: This article will publish in DCMA’s 2025 INSIGHT magazine, which highlights the agency’s warfighter support mission and its organizational goals to enhance lethality through delivery, drive government efficiency through audit, and strengthen return on investment through detection and elimination of unnecessary spending.