By August Cole
About Jim Tapp
Jim Tapp is an Avascent Global Advisor, bringing over two decades of business strategy experience within the defense industry, including knowledge of acquisition and requirements development policy, procedures and practices, as well as expertise on the federal budget. Before joining Avascent, Tapp served as vice president for Corporate Business Development at Northrop Grumman Corporation–the culmination of a twenty-year career with the company. Prior to his employment with Northrop Grumman, Tapp served in the U.S. Air Force, retiring in 1994 with the rank of Colonel. He was the Air Force liaison officer to the U.S. Senate and the associate director of Air Force Legislative Liaison, responsible for articulating Air Force programs in support of national security objectives.
My sense is the first step is to establish a shared set of expectations and incentives. Is there a value proposition for Silicon Valley? Can the defense establishment accommodate the Valley’s appetite for investment, risk and extremely short product development cycle times? Can it afford not to? We should be looking beyond disruptive technologies to better ideas that are the products of creative thinking. Uber, Amazon, Space X, Facebook, Apple and others are making some of our country’s largest intellectual and financial investments to create and capture market share. What are the incentives for those leaders to bring their resources to bear to solve problems for DOD and other federal agencies? And if one exists, what must government be able to do to fully engage their capabilities, and how can the defense industry be integrated into this outreach in order to amplify the network effect DOD seeks?
Take SpaceX, which started with a long-term goal of providing commercial travel to Mars. A predicate of that objective is reducing the cost per pound of launching humans and material into earth orbit. The goal was not achievable using the existing space launch institutions and so the company developed a new approach with traits not normally associated with manned space flight: simplicity, reusability, vertical integration, throughput, among others. They and other companies such as Blue Origin and Virgin Galactic are making commercial space access a reality while reducing cost and cycle time by orders of magnitude. Could similar results be achieved by an Amazon in DOD logistics or by Pay Pal managing government financial transactions? Would they want to?
The decision process must change. In Silicon Valley entrepreneurs are looking for the better idea and are in a race to get to market before someone else does. Being disruptive brings great rewards; their time line is six months. My experience is that better ideas are often slowed down in today’s defense establishment. Many bureaucratic methods are employed when institutions, governmental and non-governmental organizations feel in danger of being outmaneuvered. I have used many of them myself. They include insisting on competition even though there is no qualified competitor with a clearly better idea. The assumption is that competitions always get you a lower price. To the contrary, artificial competition slows down the process so others can catch up, adds schedule and cost. This is 180 degrees out of phase with the Silicon Valley mentality, thus dis-incentivizing creative people who want to bring disruptive ideas forward.
If we’re serious about bringing new players into the defense fold, the one thing I would change would be to reemphasize judgment in the acquisition process. There was a time that defense acquisition managers had many opportunities in a career to develop judgment. Now there are far fewer chances and it now appears a lack of trust has eroded the authority of appointed acquisition managers. Judgment has been replaced by artificial value systems such as LPTA (lowest price, technically acceptable), competition for competition’s sake, leveling audits at all levels, automatic, no-consequence protests and extensive lobbying. The result is very consequential government investment decisions are made for the wrong reasons, or at a glacial pace. Reinstating the value of authoritative judgment, and by extension rebuilding trust, would be a great first step. Perhaps we also have to provide more opportunity to develop judgment by feeding the Defense Department acquisition establishment in smaller bites.
The Third Offset Strategy challenges the nation to field capabilities we have only seen in science-fiction stories, like autonomous deep-learning systems and human-machine collaboration and semi-autonomous weapons. To turn what was fiction into reality will require Silicon Valley and DOD to work in a hybrid manner that may not look like anything that has come before. The challenges are to be able to relate available and emerging technology to military science and concepts of operations in order to provide the game-changing effects DOD desires; the defense industry does this every day so I see it playing a central role rather than standing to the side. This becomes as much about cultural connections as anything else.
AG Lafley, former Chairman and CEO at Proctor and Gamble, talks of the importance of catalysts in creating a culture of innovation. Catalysts are individuals or organizations that have deep knowledge of customer needs, understanding of how technology can be brought to bear and business sense. Aviation Week recently asked Burt Rutan what was needed to achieve technical breakthrough. He responded with his three Cs: curiosity, creativity and courage. I think what’s missing in the Department’s search for new technologies are those courageous catalysts with the customer and technical knowledge that have the courage to take risks along with the stamina to take on the bureaucracy.
I guess it looks a lot like it does elsewhere. Disruption can come from the application of a new technology or in the way value is perceived and delivered. Franchises and institutions are normally what are being disrupted in the commercial world. Commercial companies such as Ford and Airbus are asking themselves what might disrupt my franchises in automobiles and airliners and are striving to figure out how to disrupt themselves before someone else does. What they’re doing when they open a Silicon Valley lab is essentially self-disrupting. This is incredibly hard to do because it forces you to confront your legacy equities and base assumptions…Volkswagen, GM and Toyota are all investing in ride-sharing companies. For all the focus on Silicon Valley, we can’t forget the legacy and ongoing innovation in the aerospace and defense sector. For A&D companies, they also have to revisit their assumptions about future business, test them ruthlessly and act effectively to survive and prosper against competitors and adversaries. Nation states are adopting the tactics of the non-state actors, which means the kinds of capabilities the folks in Silicon Valley have developed are likely to show up in future conflict and be used against us.
We should also reexamine the design and engineering capabilities needed of a mid-21st century defense establishment. New manufacturing technology, such as additive manufacturing may allow us to makes stuff we can envision but cannot currently make. As well, new government procurement methods could be disruptive by accelerating the speed with which an operational need moves from concept development to operational deployment. There are a few key technology links that could be disruptive such as more efficient means of power and cooling to accelerate the pace for directed-energy weapons and semi-autonomous undersea operations. We are also now replacing the notion of a kill chain with a kill web which could very well be disruptive to platform-centric institutions and how the establishment reconceives the value of network architectures and the roles for emerging artificial intelligence and autonomy. A key challenge will be to overcome institutional inertia throughout the defense acquisition establishment.
Anything drawn-out will be anathema to what is required in the Third Offset. Speed and agility are what is needed. Protests have the same effect as when we stop a sporting event for a review from New York… They run counter to the notion of speed to field and the rapid exploitation of the better idea. They also tend to take judgment out of the process as we protest proof acquisition strategies, proposals and decisions. Protests should remain in the process to assure adjudication of an egregious error but they should not be an automatic response to a loss. Perhaps it is time to institute penalties for frivolous protests.
What can make the Third Offset truly game-changing is not forgetting to focus on process as we seek out technologies disruptive to the status quo. We should look at this as an opportunity for a fresh start or blank slate of sorts to revisit some of the assumptions we’ve come to accept as the normal course of business. They don’t come by very often. It’s important not to waste them or fail to recognize what the stakes are if we do.
Sometimes I wonder if it is talking past each other or talking to each other in their own special code. Intentionally or not, the defense acquisition establishment of legislative, executive and industry entities over time nurtured an ecosystem whose outcomes are determined by deeply rooted interests. But while we are looking to the future we should question what characteristics the defense establishment will need to help the US and its allies prevail militarily in a rapidly changing world where technological dominance is no longer a sure thing.
If we believe some pundits, we may have to decide which wolf is closest to the door. Our acquisition system is going to be heavily challenged by quickly procuring systems that offer next-level networked military capability in order to make extremely high-consequence decisions to defeat an adversary that may be attacking with overwhelming force underpinned by its own innovations. Perhaps the most productive use of Silicon Valley would be to find out how they make decisions regarding investments in new technologies that lead to new products. There is potentially a lot to learn about the process of how these large investments are made inside the quick-to-market and product-refresh cycles that are the day-to-day reality for tech firms. This would be another opportunity to reintroduce judgment into the acquisition cycle, particularly around the Third Offset’s necessarily rapid-turn technology buys.
I believe that companies such as Uber and Amazon have and will continue to change customer expectations for how products and services are delivered. With them you are one click away from having what you want at your door within minutes or the same day. Citizens will become increasingly dissatisfied with how those services are provided in the public sector and will demand change. The question is how, or can, government respond. I would think much of what government wants to accomplish exists in commercial technology architectures already in place and does not have to be reinvented. How it can be employed does have to be rethought so we don’t get bogged down in IT acquisitions quagmires or shortchange the public interest. The demand signal needs to be clear to the government, and hopefully before people get too frustrated. The folks in Silicon Valley, given the proper incentive and freedom of action, probably have a few ideas to share.
I am a believer in strategy development and deployment, and that those who will have to implement the strategy need to have a voice in the resources developed to support their missions. This is an opening to rethink where decisions are made. The move to re-engage the Service Chiefs in the process is a good one. They are the professionals charged with organizing, training and equipping the services to provide capability to the Combatant Commanders. Their airmen, soldiers, sailors and Marines will go in harms way as ordered – and will suffer the consequences of decisions made.
Along with giving the Service Chiefs a greater voice in acquisition, Defense Secretary Carter said he would look at shrinking the Defense Acquisition Board, which is comprised of 35 principals and advisers. The secretary also pledged to cut down the size of the headquarters staff in line with a 25 percent congressionally ordered reduction. Hopefully the executive and legislative branches can work together to reduce the size of the bureaucracy and streamline decision-making. The result needs to be to capture the better ideas and get them into the hands of the warfighter with speed and agility.
Government-focused corporations will want to meet their customers evolving needs and create differentiated capabilities. Satisfying the ambitions of the Third Offset will require internal investment to expand company capabilities in systems engineering and integration and the technology to enable a global strike and surveillance network that is balanced, resilient, responsive, and scalable.
Boards will want to understand the risk of these investments and believe they can be rewarded for developing and delivering the better idea. Defense companies are making those investments to position themselves to compete 20 or more years into the future. They should be and are seeking to understand what may disrupt their franchises and how to disrupt those of the competition. The ones that will be successful will actively engage the full defense industrial base as well as academia and commercial entities. The competition will result in institutions being disrupted and new ones being established. My sense is that the overarching result will be an industry able to act with the speed and agility to provide the capability needed to secure our nation’s freedom into an uncertain future.
August Cole is the writer-in-residence at Avascent. He is also an Atlantic Council nonresident senior fellow, focusing on using fiction to explore the future of war; and a member of the International Institute for Strategic Studies. He is the co-author of Ghost Fleet: A Novel of the Next World War and the editor of the Atlantic Council’s War Stories from the Future anthology. Previously, Cole reported on the defense industry for the Wall Street Journal. From Washington, he covered companies ranging from Boeing to Blackwater, as well as broader defense policy and political matters. For more information, contact email@example.com.
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