How to Get Ahead

Let’s say technology innovations relevant to your enterprise happen every N years.  Further, it takes you M years to decide to adopt an innovation and once adopted the innovation is sustained for L years.  To remain at the forefront, you need at most M = 1 and L = 1.  That way, you will always be on the cutting edge of technology.

Should you focus on reducing M or L?  M means that you are deploying platforms M technology years behind.  L means you are sustaining platforms that are eventually L + M years behind.  Further, should you focus on technologies with small or large N.  For N = 1, the number of years behind equals the number of technology generations behind.

Obviously, the answers to these questions depend on the consequences of being behind.  We need to differentiate competitive versus sustaining technologies.  Competitive advantage decreases by e-A(L+M) for competitive technologies and by B (L+M) for sustaining technologies.  Thus, the losses are either exponential or linear.

We could formulate a few equations at this point, but let’s just think it through. L+M is a major problem unless you have at least one of the following capabilities:

  1. You can upgrade to new technologies whenever they become available
  2. You can adopt technologies before they exist, by investing in options

So, either you are sufficiently fast and flexible to adapt to changes as they happen, or you have invested in technology options that enable rapid execution once uncertainties have waned.  Both of these can contribute to achieving L+M=0.  This is common in commercial industry.

However, defense agencies take 20+ years to agree on requirements for weapon systems platforms they will use for 30-40 years or more.  That’s how you end up with requirements for card readers on ships and floppy disks on airplanes.  There has to be a better way.

Capabilities 1 and 2 above can change the game, except for one fundamental hurdle.  The “waterfall” of mission to requirements to capabilities is in the way, often stretching the process over decades.  A “spiral” model would enable addressing missions, requirements, and capabilities in parallel.

The waterfall model reflects the supposed arms-length relationship between government and industry.  However, with many defense markets now effectively monopolies or duopolies, government-industry relationships could benefit from discarding this outmoded model.

Here is a possible approach.  New mission needs are addressed by teams of users, technologists, and payers.  Their goal is to synthesize alternative concepts for meeting these needs, for example, a human piloted aircraft, a remotely piloted aircraft, and a swarm of drones.  Their task is not to determine the requirements for each concept.  Instead, perhaps using three teams, they are to formulate a conceptual design for each alternative.

One or more of these conceptual designs in then chosen for detailed design and development by the same team, likely expanded to include additional competencies, for instance, test and evaluation.  This team is not working from requirements because no one will be asked to bid on meeting requirements.  Instead, government and industry, and perhaps academia, will collaborate to synthesize and refine detailed designs and specifications.

These specifications will be issued in an RFP for competitive bids to manufacture the fully designed solution.  These bids will not include design and development as that will have been completed.  Instead, the bids will be limited to fixed-cost production proposals.  Nevertheless, the production workforce so dear to Members of Congress will likely be sustained in their districts. 

By replacing the charade of market-based competitions, the time from concept to deployment can be substantially reduced.  Since time is money, the costs of systems will also be very significantly decreased.  If options-based thinking is embedded in the design and development processes, capabilities 1 and 2 noted above will be inherent.

How will this impact industry?  The work needed will be streamlined, for example, by eliminating the onerous requirements process.  Industry will support design and development via time and materials contracts.  Consequently, all intellectual property, except for manufacturing processes, will be government owned.  As production contracts will be fixed price, industry can add any level of profits they think will be competitive.  Industry’s proposed fixed unit price will not be audited.

I understand that this would be a dramatic change in how government and industry do business.  Consequently, it would be could to pilot test this approach on a set of mission needs where L+M problems are imposing severe risks of not creating needed competitive advantages.  Once successful and refined, this approach could be applied more broadly.

Leave a Reply