Good morning- Before we begin I'd like to take the opportunity to express, on behalf of the entire U.S. Army, our deepest sympathies to the victims of recent national tragedies. Americans across our country and in our territories are enduring unimaginable hardships -- recovering from an unprecedented series of natural disasters and another horrific and unprecedented mass shooting. People across America are suffering, lives have been lost, families have been devastated -- we mourn with them and for them. Let me also take a moment to praise the first responders who ran to the sound of the gunfire in Las Vegas, to the everyday citizens who despite the danger, moved under fire to aid and shield complete strangers, and thousands from federal, state, and local government continuing to respond and bring aid and comfort to the victims of disaster -- they all represent the best of America.

Thank you General Milley for that kind introduction.

You might have noticed that I speak a little differently than the Chief and the Vice who being from Boston drop their Rs. In Chicago we are linguistically neutral, so you'll have no problem understanding me.

Actually, the Chicago topic has come up before -- When I was sworn-in by Secretary Mattis, my family attended along with a number of leaders from OSD, the Army, and the other services. I introduced my dad to Deputy Secretary of Defense Shanahan, General Milley, General McConville, and Sergeant Major Dailey at which point he said "Shanahan, Milley, McConville, McCarthy, and Dailey -- sounds like a leadership meeting of the Chicago Fire Department."

Thank you for attending and for your continued support of the Army and our Soldiers, Army Family members, and our Army civilians.

Thank you to General Ham and to the entire AUSA team for your tremendous efforts in planning, organizing, and executing this great event. Meeting all of the requirements, satisfying the needs of vendors, accommodating schedules, and responding to the inevitable challenges requires centralized planning but decentralized execution. It requires understanding the intent, and being empowered to act…sounds like AUSA fully understands mission command and the Chief's idea of disciplined initiative.

I want to start by ensuring we have a common understanding that success requires a major river crossing operation…we must cross the Potomac -- to foster healthy relationships and to secure sufficient, sustained, and predictable funding. That starts with consistent communication with adequate frequency. On a personal level, I have been in your shoes and thus I value this relationship.
The FY17 funding stopped the decline of Army manning levels and provided deploying units the funding to ensure readiness. The funding enabled us to continue the near term incremental modernization of critical systems.

The FY18 plan begins our modernization effort to improve long range fires and air and missile defense, continue to replenish our munitions stocks, and provide advanced protective systems for combat vehicles and aviation.

It begins to fill shortfalls in theater sustainment and transportation capabilities. It sustains increased capacity in our Armored Brigade Combat Teams and Combat Aviation Brigades.

Failure to pass the FY 18 budget will PREVENT us from modernizing the Army, and will force us to continue mortgaging our future readiness and lethality. Congressional paralysis will have profound implications -- our adversaries will be emboldened, global stability will continue to decline, and our options to respond to an emergent threat will be reduced.

Above all, the Army needs sufficient, sustained, and predictable funding, to restore balance and reduce risk. We defend the nation with a force based on a strategy, not on a budget.

Since FY 2010 we have endured 24 total continuing resolutions prohibiting the Army from starting new procurement programs and military construction projects. They prohibit entering into multi-year contracts, increasing production rates, or reprogramming funds to higher priority requirements.

These 24 CRs have created a new norm, one where we now expect continuing resolutions. We have adjusted our business practices to curb spending, reduce training, and defer necessary maintenance on aging and heavily worn equipment. Soldiers now do 12 months of work in nine months or less. The BCA and Continuing Resolutions breed mediocrity.

We have been at war for 16 years against technologically inferior enemies who created asymmetrical techniques that adapt quickly and cheaply. While we've been focused on the wars in Iraq and Afghanistan -- Russia, China, North Korea, and Iran have invested heavily in their capabilities.

Russia in particular has focused significant investment in their anti-access and area denial capabilities, including cyber, anti-ship, long-range fires, robotics, unmanned aerial systems, and air and missile defenses. They have invested in next-generation stand-off technologies while we have made incremental improvements to our legacy close-combat capabilities.

To use a sports analogy, Russia and China are training as a boxer and we continue to train as a wrestler. They have focused on throwing punches from a distance to prevent us from getting close enough to use our strengths.

To me, this is a leadership challenge -- it falls on the shoulders of four people -- the Secretary, the Chief, the Under Secretary, and the Vice Chief.

We are responsible, and the success or failure of our army in facing these threats will be due to us, as it should be. The only time I've seen effective change is when General Officers put their stars on the table and when political appointees risk their capital.

The "Big five" are the foundation of our Army's superior combat capability. These systems -- Abrams, Bradley, Apache, Blackhawk, and Patriot were designed in the 70's, fielded in the 80's and proved themselves in the 90s during Desert Storm and again during the initial invasion of Iraq in 2003.

These systems were enabled by a fundamental change in the institutional structure of the Army and a continuity of thought that ran through the terms of 6 Army Chiefs of Staff. They have been continuously and incrementally upgraded since their introduction.

The problem is that they are 40 years old -- and there is a limit to the incremental improvements that can be made before they simply no longer offer the degree of overmatch our Army requires. Our modernization strategy for these aging platforms has yielded benefits, but they are now on the curve of diminishing returns.

These platforms were developed at what was arguably the pinnacle of the industrial era but before the explosion of the information age. Meanwhile, our peer competitors have continued to invest in technologies that counter what have traditionally been the strengths of the American military. They are improving faster than we are.

Our acquisition and modernization approaches need to evolve. We need to operate at the speed of the information age, and to have clarity of purpose.

We need to look at how industries bring new products to market and apply best practices, adapted to the unique rules governing use of federal funds.

We need to identify what processes we can adopt from other successful acquisition systems, like those of Special Operations Command who have a symbiotic relationship between the customer and procurement process.

We need disciplined innovation in order to speed the process of Buy -- Try -- Decide -- Acquire.
Yes, there are processes, organizational structures, policies, and potentially legislation that will need to change -- all of the normal components of transforming to remain viable in an ever changing environment.

I know that you're thinking you've heard this before -- and in large measure you have, the problem is always the same. However, the Army's attempts to solve the problem by adapting acquisition and modernization organizations and processes over the past 27 years have been piecemeal.

We created the Acquisition Corps in 1989, the Army Futures Center within TRADOC in 2003, Research, Development and Engineering Command in 2004, and the Capabilities Integration Center -- ARCIC -- in 2006. Despite these efforts, the Army still suffered a series of failed programs -- Comanche, $9.8B; Future Combat System, $20.7B; Patriot Medium Extended Air Defense System, $3.4B. By the time we cancelled the Joint Land Attack Elevated Netted Sensor System -- JLENS -- in 2012 we had spent $2.5B -- the Army has spent roughly $32B over 16 years on unsuccessful attempts to field new major systems.

The Army has reached an inflection point -- and we must fundamentally relook our acquisition and modernization structure and processes. Otherwise we risk sending our sons and daughters to fight tomorrow's wars armed with yesterday's equipment, against increasingly capable adversaries.

Emerging trends show the Army lacks the speed, power, structure, presence, and doctrine to deter, deny, and/or defeat future adversaries. These challenges require the Army to pursue development of new capabilities to replace the "Big 5" over time.

Today the Army has no off-the-shelf options to accelerate into new programs. Therefore, we will pursue a modernization strategy that balances capacity and capability. We need both the capacity to prosecute our current fight and maintain readiness for emergent threats, as well as new capabilities to enable multi-domain battle.

We will continue to make incremental improvements to existing combat systems to ensure the U.S. can fight and win in the near term.

We will sustain current combat support and combat service support equipment to extend their useful life.

We will focus our science and technology investments, on a critical number of prioritized efforts to ensure our Soldiers have formation based tactical overmatch and technological superiority.
We will begin prototyping a select number of next-generation combat system technologies and vehicles -- moving from prototype to production as soon as the technologies are mature enough.
We will support this modernization strategy by continuing to divest less important capabilities to free up resources for higher priorities. It is our intent to publish this strategy in FY18.
The Chief and I have already initiated this modernization strategy -- we have directed the Army to take aggressive moves and invest against six signature modernization efforts that can be realized in the near and mid-term.

I have initiated a reprioritization of money in the POM, and a Science & Technology review that will support development of these efforts. And I will continue to invest in them with ruthless prioritization with resources protected across the five-year Future Years Defense Plan.

First, a Precision Fires capability that restores US Army dominance in range, munitions, and target acquisition.
Second, next Generation Combat Vehicles, including optionally-manned variants with the most modern firepower, protection, mobility, and power generation capabilities, to ensure our combat formations can fight and win against any foe.

Third, future Vertical Lift platforms -- optionally-manned, both attack and lift, that are survivable on the modern and future battlefield.

Fourth, an Army Network that is mobile and expeditionary -- that can be used to fight cohesively in contested cyber and electromagnetic environments.

Fifth, air and Missile Defense capabilities like mobile-SHORAD (Short Range Air Defense), directed energy, and advanced energetics -- capabilities that ensure our future combat formations are protected from modern and advanced air and missile delivered fires -- including drones.
And, last but not least, Soldier lethality that spans all fundamentals -- shooting, moving, communicating, protecting and sustaining.

Putting this all together, we must improve human performance and decision making by increasing training and assessment, starting at the soldier level. This will require a rapid expansion of our synthetic training environment and deeper distribution of simulations capabilities down to the company level, with simulation capability to model combat in megacities, a likely battlefield of the future.
To be successful we must remain disciplined -- and that requires leadership. We are doing the following things to sharpen the front end of the acquisition process:
We are implementing directives that will address specific business practices. The first two fundamental directives have already been signed -- they address the two most critical aspects of our challenge: the requirements process, and talent management.

The first directive establishes Cross-Functional Teams (CFTs), aligned with the signature modernization efforts I outlined. These teams will compress the cycle by involving the warfighter in requirements definition, interpretation, prototyping, and concept validation prior to Low Rate Initial Production.

These teams will be led by warfighters who understand our formations and who have combat experience leading and managing them. The CFTs will include elements from program management, finance, testing, and science and technology -- to name a few.
We are rewiring the organization against modernization to achieve unity of command and unity of effort by aligning, consolidating, and synchronizing disparate processes and elements and folding them into a new command that will report directly to the Vice Chief of Staff and the Under Secretary of the Army.

We are NOT looking at creating a new organization that will simply compete against the others -- the historical approach, that has further exasperated our challenges. Instead, we are consolidating warfighter, technical, programmatic, and financial communities to fuse the time and investment against clear priorities.

The second directive is related to talent management. The successful programs I've seen have been leader driven -- informed by warfighters -- and supported directly by those with the statutory authority to prevent the tendency for programs to drift.

I will say this again so that we are clear -- this is a leader issue, we are adjusting our organization to put capable, proven leaders at the head of the organization who will be singularly focused. On top of that, there are four people ultimately responsible for this effort's success -- the Secretary, the Under Secretary, the Chief, and the Vice Chief. This is a merger. We are moving roles from traditional Major Commands and realigning them to permit the Chief of Staff to provide focus and clarity to the requirements process.

I recognize that the Army culture is to have "more" -- more assets, more responsibility, and more authorities. So, pulling roles and resources from across the force and realigning them may be viewed by some as a negative. However, I would argue that point -- because no single entity has total control over the destiny of capability development but only an equity stake.
This realignment affords them more ability to focus on the core functions of their organizations for which they do have total control, authority, and responsibility. The turmoil will be short-lived and this realignment will improve efficiency, effectiveness, and most importantly, productivity for our Army.
I want to reassure you that we do not intend for this to require a mass of relocations, uprooting of families, and disrupting lives. This is simply a rewiring to improve our processes and get capabilities to the warfighter faster. As Secretary Mattis says "It does us no good to be dominate if we are also irrelevant."

Whenever I do interviews I get asked my thoughts about returning to the Pentagon, and to the Army. I tell them that this is the honor of a lifetime, and I'm excited and humbled to have been asked by Secretary Mattis. I tell them that having been on active duty and deploying to combat allows me to appreciate the culture of the institution and what it's like to be a young person at the tip of the spear headed into combat and the unknown.

I think about the people I served with, I think about them every day, particularly those who died, and the families who still suffer their loss. I think about how important it is for me to be the Under Secretary they deserve and how I must earn their service and sacrifices.

I am absolutely committed to seeing this effort through. An organization as large and complex as the U.S. Army does not implement change easily. It requires resolute determination -- conviction -- strength of will. I accepted this opportunity because of my enduring passion for the Army and our Soldiers.

I share that with you because we are all here through an affiliation with the Army. I ask that you evaluate your affiliation, and where you can strive to deserve what our Soldiers and Families provide.
ARMY STRONG!!!