What is a Portfolio Acquisition Executive (PAE)?
A Portfolio Acquisition Executive (PAE) is the single accountable official for outcomes across an acquisition portfolio in the Department of War. The role replaced Program Executive Officers (PEOs) under the November 2025 Acquisition Transformation Strategy, implementing the Executive Order on Modernizing Defense Acquisition and related provisions in the FY26 NDAA.
The shift is from program-centric execution against individual baselines to portfolio-level strategy, resources, and outcomes. A PAE holds broader decision authority than a PEO across acquisition, requirements, budgets, workforce, and sustainment.
How a PAE Differs from a PEO
PEOs executed individual programs to approved baselines. PAEs are accountable for portfolio outcomes. They can move resources inside their portfolios, trade cost, schedule, and performance to prioritize time-to-field, and align contracting, testing, and systems engineering under their chain of command.
Instead of overseeing dozens of programs to fixed baselines, a PAE focuses on schedule-driven capability increments, portfolio-level programming within authorized boundaries, and capability trade councils that replace configuration steering boards. The stated goals are faster fielding, greater use of commercial technology and Modular Open Systems Architecture (MOSA), and better interoperability across related systems.
Authorities the Department Directed
The SECWAR memo and Acquisition Transformation Strategy directed the Military Services to establish PAEs as the single accountable official for portfolio outcomes with authority to:
Structure programs as schedule-driven capability increments with aggressive production delivery schedules, unit-cost ceiling goals, and broad mission effectiveness goals. Make trade-offs throughout development to permit iterative enhancement and rapid delivery of subsequent increments. Make prudent cost, schedule, and performance trades that prioritize time-to-field, including execution of portfolio-level programming within defined and authorized boundaries.
Implement capability trade councils, replacing configuration steering boards, to integrate operational and acquisition authorities and make requirement trade-offs, and waive technical standards and other certification requirements not mandated by statute or safety.
Maximize use of Modular Open System Architectures (MOSA) for development programs moving forward by obtaining delivery of critical system interfaces with government purpose rights to enable modular competition and supply chain resiliency.
Organizationally align contracting officers to report directly to PAEs in the acquisition chain of command, to maintain responsiveness to the operational problems that materiel solutions are intended to address.
The acquisition chain of authority flows from the Defense Acquisition Executive (DAE) to the Service Acquisition Executives (SAEs) to the PAEs. The PAE structure preserves the statutory authority of the SAEs for all Military Service-managed programs and portfolios.
Direct Report Portfolio Managers (DRPMs) are a related role. They oversee selected strategic portfolios and report directly to the Deputy Secretary of War or, in the Navy, the Secretary.
How the Services Are Implementing It
Each Military Service is implementing the model differently. The Army, Navy, Air Force, and Space Force have stood up PAEs on different timelines and portfolio cuts since late 2025. Portfolio boundaries, reporting relationships, and the pace of transition vary by Service.
For the current list of named PAEs, DRPMs, portfolios, and the programs they oversee, see the living directory on Digital Pentagon: Portfolio Acquisition Executives (PAEs) and DRPMs.
Practical Implications
For PAEs: The role is designed to give you the ability to make trades and move resources inside the portfolio to prioritize time-to-field. Use the capability trade council and direct alignment of contracting and technical staff. Document the decision rights so they survive the next turnover.
For program managers: Expect more portfolio-level trades and fewer fixed baselines. Your success will be measured against portfolio outcomes and delivery increments, not solely against a single program’s original APB.
For industry: Portfolio boundaries and the PAE’s ability to shift resources and requirements will change how you engage. Align to the portfolio’s mission outcomes and MOSA interfaces rather than only to a single program office. Contracting officers reporting to the PAE should shorten some decision cycles.
For Congress and staff: The FY26 NDAA and Acquisition Transformation Strategy codified and directed the shift. Oversight questions center on whether PAEs actually receive and exercise the authorities described above, how Services define portfolio boundaries, and whether the handoff of decision rights is real or only on paper.
See our full suite of PAE and Portfolio Management posts.
PAEs can contact us at Creative Defense Network to advise and resource them with the knowledge and tools to succeed in the new portfolio paradigm.