A New Model for COTS Collaboration

A New Model for COTS Collaboration

Published in Military Embedded Systems
By Jason Shields

Here’s how it usually goes: Faced with the need to upgrade an older platform or design a new one, a prime contractor will select – where it makes most sense in terms of risk, cost, and time – a mix of COTS [commercial off-the-shelf] suppliers and system integrators to function as subcontractors that will develop and build the various subsystems their program demands, for example, the mission computers, displays, and data concentrators. The prime contractor, making strategic build-versus-buy decisions about what tasks to keep in-house, will focus on those that have the most value, for example the platform itself or the application layer software.

Rather than build modules or subsystems from the ground up and reinvent the wheel, the prime goes out to industry to select solutions from vendors who have already developed or can modify an existing product that meets their requirements. After, the prime must manage, say, ten different vendors and ten different subsystems, all developed in a silo. If something goes wrong, the prime has to investigate which subsystem is at fault and act like a general contractor to facilitate the investigation. More often than not, the various COTS vendors will try to make the case that the problem lies with one of the other suppliers.

One alternative to this scenario arises when a single COTS vendor offers to supply, for instance, six of the subsystems to the prime, while managing one or more other COTS vendors to supply the remaining four. The downside in this case comes from the higher costs to the prime and – ultimately – the taxpayer that result from margin-stacking. The first COTS supplier, essentially taking on the role of contractor, needs to be compensated for taking on the extra risk, burden, and responsibility of managing the other suppliers.

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