Supplier Chain Visibility—A Contracting Necessity

Abstract

"This paper investigates the weaknesses present in federal procurement supply chains, emphasizing cost analysis, cybersecurity, and risk mitigation within defense contracts. Utilizing data from more than 200 Contractor Cost Data Reports and 87 Price Negotiation Memorandums (2015–2025), the analysis shows that subcontracting, materials, and inter-company transfers constitute more than 80% of direct costs, emphasizing the necessity for increased transparency and accountability in government acquisitions. The study points out significant threats, including dependence on foreign sources, cybersecurity vulnerabilities, and inadequate oversight of single-source suppliers. It assesses private-sector frameworks like IBM’s cognitive supply chain and Starbucks’ enterprise risk management to pinpoint best practices applicable to defense procurement.

This paper also considers unsuccessful legislative attempts to enforce supply chain compliance, highlighting the significance of flexible policies, contractor involvement, and financial incentives. Key recommendations include improving bill of materials transparency, widening the oversight of DCMA and DCAA, and bolstering domestic manufacturing efforts. Case studies from the F-35 and C-17 programs demonstrate the repercussions of insufficient oversight and the benefits of responsible sourcing practices. Ultimately, the paper promotes a forward-thinking, technology-focused, and risk-managed procurement approach that enhances national security and fortifies the resilience of the defense industrial base."