Acquisition Talk

Trey Herr and Simon Handler from the Atlantic Council's Cyber Statecraft Initiative joined me on the Acquisition Talk podcast to discuss how the Department of Defense can improve the mission resilience of its systems. The three pillars of resilience are robustness, responsiveness, and adaptability. In that description, resilience is more than about responding to adversity, but capitalizing on opportunity. Oversight agencies should take note that that adherence to plan is nowhere in that definition. During the episode, we discuss: - How mission resilience metrics differ from CMMC - The costs of excessive classification to security - How Netflix uses the chaos monkey to find failure modes - Comparing CIA's Corona satellite development to that of F-35 ALIS - How the BattleLab idea can increase recombinatorial innovation During the episode, we dive into a recent paper Trey and Simon wrote in conjunction with folks from MIT Lincoln Labs and Boston Cybernetics called "How do you fix a flying computer? Seeking resilience in software-intensive mission systems." https://www.atlanticcouncil.org/in-depth-research-reports/report/how-do-you-fix-a-flying-computer-seeking-resilience-in-software-intensive-mission-systems/ They recommend a new Center of Excellence for Mission Resilience in the DoD. The purpose would not be to duplicate cybersecurity initiatives, but rather to create metrics which can be put on contract to better verify that firms are using modern development processes like DevSecOps. In order to have adequate status, such a Center of Excellence require a Senate-confirmed position, a dedicated budget account, and quick access to the DepSecDef. But ultimately, it shouldn't be a Top Secret project creating DoD-unique rules and processes. Instead, the Center should adopt the thought leadership from the commercial and academic sectors as to what makes organizations resilient. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at https://AcquisitionTalk.com.

I was pleased to speak with Colonel Bryon McClain on the Acquisition Talk podcast to discuss the biggest questions facing the defense acquisition system. He is the senior acquisition course instructor at the Eisenhower School, and before that he was the materiel leader for the rapid acquisition branch in the MILSATCOM directorate at the Space and Missile Systems Center. We touch on: - The role of interservice rivalry in military innovation - How today's processes address risk but not uncertainty - Moving past cost accounting when monitoring contracts - How unintended consequences plagued the C-5 development - Whether reform should focus on workforce culture or rules and regs In the episode, Bryon suggests a framework for how to interrelate the defense acquisition system with multiple fields of thought. One interesting aspect of that is the concept of American anti-statism along the industry and political axis in which it is agreed that government won't pick winners and losers but instead write the "rules of the road." In defense, however, the government writes the contracts with industry. So it has to pick winners and losers, right? In some cases that is true -- DoD is living with the winners of previous competitions. But for disruptive capabilities, DoD could help create markets. Bryon points to the Air Force's agility prime initiative, which seeks to support commercial eVTOL companies with the expectation of military applications to follow. While government may let contracts which still has a winner/loser aspect, there are many other ways about it. For example, providing companies equal access to test ranges and facilities, or providing industry subsidies like in solar panels and electric cars. As companies move down the cost curve, DoD becomes well placed to access disruptive innovation earlier and create dynamism in its industrial base. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Anne Marie Knott joined me on the Acquisition Talk podcast to discuss her book How Innovation Really Works. She is a professor of strategy and innovation at Washington University at St. Louis, and is a former researcher at Hughes. Anne Marie tackles a lot of innovation dogma, including whether: - Smaller companies more effective at R&D than large - US federal research has actually declined - Decentralized R&D beats out central labs - We've picked the low hanging fruit and science is slowing down - Firms are not spending enough on R&D In the episode, Anne Marie discusses her measure for R&D productivity called the research quotient (RQ). You can think of it as the relationship between R&D spending and revenues for a given firm, controlling for other factors including capital (from the balance sheet), labor (from the number of employees), and a couple other variables. The more responsive revenues are to changes in R&D spending, the more productive a firm's R&D is relative to other firms. Anne Marie draws a number of conclusions from looking at firm RQs across sector and time. She finds a 65% decline in average R&D productivity over the past five or so decades. Two-thirds of firms are actually spending too much on R&D, and could increase revenues by cutting R&D. But she's also seen maximum RQs increasing over time particularly in newly formed industries, so there seems to be this divergence in outcomes. Anne Marie takes an optimistic view. There are ways firms can improve their R&D productivity, lessons that can benefit defense policy makers. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Richard Danzig joined me on a joint episode of the Acquisition Talk and China Talk podcasts to discuss US-China relations and military innovation. Richard is a Senior Fellow at Johns Hopkins APL, a former Secretary of the Navy, and much more than that. We traverse a number of subjects, including: How the risk of war with China is reflected in trade policy The problems regulators face in high-tech industries Views on growing the US Navy to 500 ships How US prime contracts differ from state-owned enterprises Whether the Chinese are more risk-tolerant than the US This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Christian Smart joined me on the Acquisition Talk podcast to discuss his new book, Solving for Project Risk Management. He is the chief scientist at Galorath Federal, and before that he was the cost chief at the Missile Defense Agency. We touch on a number of important issues, including: - Whether Augustine's Laws still have relevance - The track record of NASA's better, faster, cheaper program - How to do cost estimates on data projects like AI/ML - Whether the DoD is trying to jam too many programs into the budget - The effect of MDA's matrixed organizational design In his book, Christian talked about a prevailing belief in the 2000s that the Department of Defense could benefit from a "free lunch" when it funded to portfolios of projects. Similar to how diversification between uncorrelated assets gives investors the chance to get the same return with lower risk (or a higher return for the same risk), funding a group of projects at the 60th percentile cost estimate could achieve an 80 percent confidence level for the portfolio overall. Christian argues that projects have asymmetric probability distributions for cost and schedule. You are more likely to see black swans in the cost growth direction than you are in cost savings. When more projects are put under a portfolio, the likelihood that one of them will have relatively extreme cost growth increases. We discuss the implications of this result, and what procedures managers can take to mitigate or even remedy the effects. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Bryon Kroger and Matt Nelson joined me on the Acquisition Talk podcast to talk about digital transformation in the Department of Defense. They are the CEO and COO of Rise8, a digital consulting company, and previously had leading roles in the Air Force’s Kessel Run software factory. In the episode, we talk about: - Roper’s ‘There is no Spoon’ paper on the digital trinity - Their take on the new DoDI 5000.87 Software Acquisition Pathway - What it means for government to “own” the tech stack - How Rise8 will support the Advanced Battle Management System - Why entitlement funding is dangerous for organizations This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

In this special crossover episode with ChinaTalk podcast host Jordan Schneider, we interview director of the Defense Innovation Unit Michael Brown. We touch on a number of topics, including: Industrial espionage and foreign investment The debate over basic vs. applied research China starting to determine technical standards Coordinating with allies on semiconductors Transitioning tech in the DoD Before taking the helm of DIU in 2018, Michael co-authored a study with Pravneet Singh showing how Chinese participation in the US venture/tech ecosystem had surged from $300 million in 2010 to $11.52 billion in 2015. The Chinese made up of 16 percent of all deals in 2016. That work launched the Foreign Investment Risk Review Modernization Act (FIRRMA) which strengthened the government's ability to block Chinese investments. While the Chinese still work hard to transfer technology from the West, in several cases China itself is setting the standards and aggressively exporting that to other countries. They have national champions for artificial intelligence, e-commerce, 5G, drones, and so forth, which are strategically subsidized to achieve a monopoly on infrastructure. The competition with China is not like the Cold War. Decades ago, the Soviets were at a disadvantage. They (1) had a much smaller economy (about half the size); (2) were not integrated with the global economy; and (3) were not developing technology standards. The answer is not to anoint domestic champions in the United States, but to invest more heavily in S&T and provide safeguards to protect it from IP theft. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

In this special episode of the Acquisition Talk podcast, we listen in to a great conversation on intellectual property in defense. The panel is moderated by my colleague Jim Hasik (who, by the way, has a great blog) and features Richard Gray (the DoD's IP chief), Shay Assad (former DoD pricing chief), Kelly Kyes (Boeing), and Bill Elkington (former IP director at Collins Aerospace). There were tons of great insights throughout, including: What causes companies to "buy-in" on production Whether there is a level playing field for commercial and defense contractors The difference between OMIT and DMPD data How the DoD is moving to negotiate specially tailored deals early Whether government should get IP rights for a modified commercial product The conversation is teed off by Jim's third IP white paper where he looked at the effects of IP rights on the prices of military trucks using a natural experiment. The Army bought the IP rights to the FMTV cargo truck while the Marines did not buy the IP rights for their equivalent MTVR. When they came up on follow-on procurement contracts, both services saw price increases roughly 20 percent, despite the fact the Army bought the IP rights. Jim has a good bit to say about that and more nuance in the paper. There were tons of great discussions, but one that caught my ear was the difference between IP rights related to defense and commercial contractors. Shay Assad argued that defense contractors have their independent R&D costs reimbursed by government, which puts them on an uneven playing field with commercial companies who funded R&D our of their gross profits. That dichotomy in risk should have consequences on pricing and on IP rights. Kelly Kyes argued that defense IR&D doesn't have commercial applications, so needs riskless reimbursement, and in the case of Other Transactions contracts, it waives the necessity of cost-sharing requirements for nontraditional contractors. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Researcher Maiya Clark at the Heritage Foundation joined me on the Acquisition Talk to discuss her recent paper on the Navy's public shipyards as well as other industrial base matters. She finds that the four remaining public shipyards, which service the Navy's entire nuclear fleet, are all over 100 years old. They are not designed to maintain larger ships like the Ford-class carriers or Block 5 of the Virginia-class submarines. As a result of under-investment in capital, maintenance delays have been on the rise. Though delays have trended back in the right direction, exceptional procedures like 45% overtime on an on-going basis cannot last forever. During the episode, we discuss: - The Navy's Shipyard Infrastructure Optimization Plan (SIOP) - How a fault line can claim one shipyard in Puget Sound - What's wrong with Buy American proposals - A research agenda for defense supply chains - The viability of Trusted Capital Marketplace One major issue concerning the public shipyards is whether they can service a growing fleet. While the Navy's ship count reached a nadir of 275, Congress was receptive to a plan for 355 ships. More recent discussions have the figure north of 500. Much of that expansion is in non-nuclear surface and unmanned vessels. But it still raises the question about shipyard maintenance capacity. The Navy's SIOP capital investment plan of $21 billion over 20 years -- which is likely to be underfunded -- will recover most of the expected maintenance delays for today's fleet. Even if the Navy could expand ship production, it isn't clear how they could be maintained. The Navy may find itself with the same readiness metrics debate going on in the tactical aircraft world. I see two interpretations. First, over-production of major weapons that cannot be sustained in peacetime is a risk-management proposition. Production lead times are very long. In times of emergency, it is easier to surge operations and support capacity than it is industrial production capacity. Countering that view, it is likely that many existing weapon systems will be found vulnerable to new systems and CONOPS. Having more outdated and outclassed systems could be a recipe for disaster. Such was the stance the US Army found itself in prior to WWII. For example, General Hap Arnold said using B-18s against Germany was "suicide." This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.

Ryan "Stinger" Fishel joined me on the Acquisition Talk podcast to discuss the future of the fighter aircraft community. Ryan is an F-15E pilot for the United States Air Force and a friend whose perspective I've benefited from over the past year. The views Ryan expresses in this episode are his own. Throughout the podcast, we discuss a number of timely issues, including: Implications of the DARPA AlphaDogfight simulation Hot takes on the news of NGAD's first demonstrator Why it's important to think about self-contained logistics How operators fit into the acquisition process John Boyd's legacy on tactics and the mental/moral aspects of war In the episode, Ryan argues that there is plenty of room for artificial intelligence to automate the tasks of a fighter pilot. However, many aspects of the job seem to require an understanding of the context that's beyond AI at this point. The battlefield can be a complex place with multiple actors of differing intentions. Escalation has to be managed carefully, as tactical decisions increasingly have operational or strategic implications. We also discussed the Next Generation Air Dominance (NGAD) program. Recently, the Air Force announced that it built a new demonstrator aircraft in just one year as part of the program using digital engineering and mature subsystems. NGAD isn't intended to result in just a single aircraft, but progress a family of systems that can be integrated onto a new platform every few years. It hearkens back to how military aircraft used to be developed in the 1940s and 1950s. Though NGAD is controversial, it intends to inject competition into the aerospace industry, which has been going through a long period of consolidation and stagnation. This podcast was produced by Eric Lofgren. Soundtrack by urmymuse: "reflections of u". You can follow us on Twitter @AcqTalk and find more information at AcquisitionTalk.com.