How to Brace for Impact: DOD’s Bold Acquisition Overhaul

On April 9, 2025, the President signed a sweeping Executive Order (EO) titled “Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base.” This directive is more than a policy tweak—it’s a shift in how the Department of Defense (DOD) acquires technology, engages contractors, and delivers warfighting capability. Here’s what you should know if you’re a government contractor working with DOD.

Speed and Innovation Are Now National Priorities

The EO indicates that America’s acquisition system is too slow, rigid, and out of step with modern threats. In response, the DOD is being told to:

• Prioritize commercial solutions over custom development
• Use Other Transactions Authority (OTA) and Rapid Capabilities Office (RCO) processes more broadly
• Streamline acquisition approvals using the Adaptive Acquisition Framework (AAF)

Takeaway: If you’re not already packaging your solutions in a commercial or dual-use format, start now. These pathways will become the new standard.

A Transformed Acquisition Workforce Is Coming

The EO calls the acquisition workforce a “national strategic asset”—and it’s being overhauled. Expect:

• New performance metrics that reward innovation, speed, and user-focused solutions
• Training teams deployed across DOD to teach how to use OTA, commercial pathways, and agile procurement tools
• Streamlined roles and reduced bureaucratic checkpoints

Takeaway: Contractors should prepare for a nimbler, innovation-driven customer and be ready to deliver at their pace.

Major Defense Programs Face Cancellation Risk

The EO mandates a full review of all Major Defense Acquisition Programs (MDAPs). Any program that meets these criteria is at risk of being canceled:

• 15% over cost or schedule
• missing key performance parameters
• misaligned with current DOD priorities

Takeaway: If your program is underperforming, expect scrutiny. If your offering is more efficient or adaptable, you may be able to displace an incumbent.

Regulatory Streamlining Underway

Internal DOD regulations and guidance will undergo a “10-for-1” deregulation rule—eliminating 10 old policies for every new one introduced (see EO 14192, January 31, 2025). Key targets include parts of the Defense Federal Acquisition Regulations Supplement (DFARS) and the Financial Management Regulation (FMR).

Takeaway: This opens the door to faster acquisitions and simpler compliance, but it requires contractors to stay ahead of constant change.

What This Means for Government Contractors

This Executive Order represents a paradigm shift in defense procurement:

• Faster timelines will require leaner proposal teams and solution-first messaging
• Traditional contractors must modernize to remain competitive
• Innovative, agile firms—especially in AI, autonomy, cybersecurity, and dual-use tech—have an edge

The days of long proposal cycles and slow program ramp-up are being challenged.

Conclusion

The defense industrial base is being told to deliver faster and with less red tape. For contractors, this is both a challenge and a chance to lead. Embrace commercial pathways. Align with user needs. Be bold in proposing new solutions. This EO is the clearest signal yet: Innovation and execution are now the most valuable assets in defense contracting, all at an acceptable level of risk.

Lohfeld Consulting can support your transition with targeted proposal strategy, training, and proposal writing services to help your team align with the new acquisition priorities. Contact us to learn how to stay ahead in this new era of defense acquisition.

Relevant Information

• Use Mega Bids to Drive Business Growth in 2025

• How to Make Every Government Debrief Count

By Brenda Crist, Vice President at Lohfeld Consulting Group, MPA, CPP APMP Fellow

Lohfeld Consulting Group has proven results specializing in helping companies create winning captures and proposals. As the premier capture and proposal services consulting firm focused exclusively on government markets, we provide expert assistance to government contractors in Capture Planning and Strategy, Proposal Management and Writing, Capture and Proposal Process and Infrastructure, and Training. In the last 3 years, we’ve supported over 550 proposals winning more than $170B for our clients—including the Top 10 government contractors. Lohfeld Consulting Group is your “go-to” capture and proposal source! Start winning by contacting us at www.lohfeldconsulting.com and join us on LinkedIn, Facebook, and YouTube^(TM).