This is a death spiral we’re in now," said Heidi Shyu, assistant secretary of the Army for acquisition, logistics and technology, describing the state of Army modernization.As the budget comes down and programs are extended, smaller quantities of items are purchased, driving up cost, she pointed out.Organic industrial workers are sitting on their hands with less work coming in. Small businesses that produce critical system components that the Army can no longer afford risk bankruptcy.Shyu and others spoke at the Annual Meeting and Exposition of the Association of the United States Army Institute of Land Warfare’s "Delivering Innovation for Force 2025 and Beyond" panel.If things are bad now, Shyu predicted, they’ll get far worse next year when sequestration kicks in again.Morale will continue to plunge across the Army and the civilian workforce. Attrition rates of skilled workers will continue to rise.Dueling budgets caused by uncertainty of the budget size will continue to stress those calculating them on best- and worst-case scenarios.Damage has already been done, she said. Cuts over the last few years in the Army’s research, acquisition and development account have "come down twice as fast as the Army top line."Adding "The Army top line has come down 15 percent, the research, development and acquisition (RDA) account has come down 33 percent."Shyu said she’s also concerned for the future of modernization and science and technology, referred to as S&T, capabilities."If you take out the procurement part of the RDA and look at the rest of it – science and technology and design and development – compared to other services, we have a far smaller amount. That’s very disconcerting for our future," she said.Also, besides Congress not providing predictable budgets and slashing those it passes, it is not authorizing the Army to find savings by removing unused or underutilized facilities in a new round of base realignment and closure, she said.Maj. Gen. Robert Dyess, director, force development, G-8, agreed, emphasizing that the "budget cliff comes in next year unless the law changes. It will impact everyone detrimentally."He added, "We had to reprogram funds away from critical equipment needs we have in the force."Those funds were used to balance modernization with readiness and end-strength, the latter of which hasn’t been able to come down fast enough.Pentagon molassesComing from industry to the Pentagon was "a real eye-opener for me," Shyu said. The current acquisition process is stagnated by a lot of bureaucracy and "onerous statutes that come out each year."She cited an instance of 68 documents required to get through just one milestone in a program. "It’s painful."For new major programs to emerge, it takes two years to get the requirements, then two years to budget them – if nothing derails, she said.The contracts themselves are complex and have to be vetted methodically to avoid protest or fraud."Everyone blames the poor PM (program manager) for not moving a program along quickly," when it’s all those other factors, she said.In private industry, if there’s an acquisition problem, the best minds, including the engineers, are rushed in to fix it to avoid bleeding cash, she said. "They don’t have that capability in the Pentagon."There also needs to be better communications between the Pentagon and private industry."Tell them what capabilities are needed," she said. "Companies have money to invest" as long as they have the requirements.Requirements for new systems or subsystems are currently focused on bringing down lifecycle costs and ensuring components can plug and play with systems and systems can interact with other systems, she said, adding that industry has improved at designing common operating standards and not stove-piping systems.That is not to say there will be many new systems, Dyess said."In the near-term, we made some hard choices on modernization," he said.Adding, "We’re going to rely on mature technologies, improving current platforms, subsystems and components – not developing new platforms."People powerLt. Gen. Patricia E. McQuistion, deputy commanding general, Army Materiel Command, said, "We have really reorganized ourselves to be as far forward with the warfighters as we possibly can, providing on-the-ground, at-the-point-of-need support. And, that has been accomplished through our logistics assistance representatives embedded with all tactical units."Recruiting, retaining and motivating the talented soldiers and civilians should be a top priority, she said, prescribing three ways to do so.First, people want to be part of a cause that’s greater than themselves. The Army does this well because of what it represents.Second, the hard-working, skilled people need recognition from peers and, more broadly, from society.The third and most difficult, is giving the workers a certain level of autonomy to innovate.The military is a centralized organization. It’s a "weakness we have to deal with somehow."Mary Miller, deputy assistant secretary of the Army for research and technology, admitted that logistics is less exciting than weapons systems, "so we don’t get a lot of people who want to do that. Yet, it’s a key enabler for the Army."The cutting edge of technology, she said, is in the human dimension.This is where the Army needs more social scientists and biologists who understand cognitive processes – especially in S&T work.Miller closed on a note of optimism toward what S&T can deliver. "The Advanced Affordable Turbine Engine program is a good example of an S&T driving down maintenance required by 25 percent and increased fuel efficiency by 13 to 15 percent," she said.