Searching High and Low for Innovation

Anyone who has attended an industry conference lately knows that the Defense Department is on a hunt for “innovation.” It’s the topic du jour, the latest buzzword in acquisition and the subject of numerous PowerPoints.

Innovation. What is it? Where is it? Whose got it? How do you get it?

The thinking lately is that innovation might have been hiding out from the Defense Department, specifically in Silicon Valley. Secretary Ash Carter is said to be “courting” the tech firms in California, primarily for help in the cyber security realm. He gave a major speech at Stanford University in the spring and set up a new outreach office in the Bay Area.

The Pentagon is on the hunt for innovation and seems to be casting its eyes West. But what is “innovation” exactly? How will the Pentagon know it when it sees it?

It was a topic at a recent panel discussion set up by the office of the assistant secretary of the Army for acquisition, logistics and technology at the Association of the U.S. Army’s annual conference in Washington, D.C.

It was there that Maj. Gen. John F. Wharton, commanding general of the Army’s Research, Development and Engineering Command, announced that he was setting up an Army Research Laboratory — West in a partnership with the University of Southern California in order to attract a new generation of researchers.

It will not be an ordinary Army Research Lab, he said. “It will look to all our other organizations to participate, to do recruiting and to have an open campus-like system, or ecosystem, because many of the kids that are out there don’t want to move East. They want to stay out West.”

The belief that innovation and “pioneers” reside on the West Coast is nothing new and dates back to the 1800s. “Go West, young man, go West and grow up with the country,” Horace Greely said in 1865. It’s creative: Think Hollywood, DreamWorks, Pixar, Industrial Light and Magic. It’s the home of Lockheed Martin’s Skunk Works, Lawrence Livermore Laboratory and the new generation of private sector space entrepreneurs following in Howard Hughes’ footsteps such as SpaceX’s Elon Musk. California by itself is said to be the world’s eighth largest economy.

Yet the organizer of the panel, assistant secretary of the Army Heidi Shyu, handpicked executives to participate from three companies that were well known for bringing innovation to the table. Two of them hailed from places seemingly as far from California as one could get: Harris Corp., headquartered in Melbourne, Florida, and Rockwell Collins, of Cedar Rapids, Iowa. The third, AeroVironment, is based in Simi Valley, California, north of Los Angeles. All three of these companies also have successful commercial sides of their businesses, Shyu noted.

“We are looking for innovation not from just big primes, but small businesses and universities in addition to RDECOM. We are canvassing innovation across the board. It is not uniquely located in any one specific area or any one specific domain,” Shyu said.

Mike Jones, vice president and general manager for communications and navigation products at Rockwell Collins, said innovation doesn’t begin with the discovery of some new technology that needs to be funded. It begins much earlier: “It begins with a problem that needs to be solved,” he said.

Dana Menhert, chief global business development officer and senior vice president at Harris, said innovation is something that “takes you forward; makes you better than what you don’t have today.” It could be a business model, or technology.

All this talk of innovation residing in Silicon Valley reportedly has the traditional big Pentagon contractors miffed and maybe a little hurt. They have facilities doing cutting edge research in all parts of the nation.

Taking a stroll through the exhibition hall at the Army conference, one found plenty of new ideas for products the primes have paid for out of their own internal research-and-development funds in hopes that a government customer will come along.

“You got any contracts for this yet?” a reporter asks.

“No,” says the business development executive. But someone wearing a uniform picked up a brochure earlier. “The Army might be interested,” he can now say.

Panelist Pierre Chao, founding partner of Renaissance Strategic Advisors, and a long-time observer of the Pentagon acquisition system, said innovation isn’t always a piece of technology. It’s sometimes a new way of doing things. And the Pentagon is in dire need of new ways to do business.

Most of the innovation coming from the big tech firms out West has little to do with gizmos or software that could be converted to a military purpose, he said.

“I think there is a [misconception] about what Silicon Valley is doing these days. It has been mostly about business model innovation. Amazon was a business model innovation, not a tech innovation. It leveraged technology, but it was really about changing business models,” he said.

Putting aside Apple and its computers, think Uber, eBay and Google. They aren’t known for manufacturing anything, but rather the disruption they caused in their fields with new thinking. That’s the kind of innovation the Pentagon needs.

And that seems to be the fundamental problem. To borrow an expression from the pioneers heading West, the cart might be coming before the horse. Once the Pentagon recognizes innovation, how is it going to acquire it quickly and affordably? 

Topics: Business Trends, Doing Business with the Government, Defense Department