Defense acquisition rules expand without sustained leadership

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 35:30

   Do you think that outside of what Anderle's building, there's actions that this administration should be taking or that the private market should be taking to solve this hardware manufacturing and capacity gap that we have right now? My view is they're actually taking a lot of actions. Not all of them have come to see the day of light here, but even something as simple as reimagining munitions and drones as consumables, they're not things that you build and then stock on a shelf.

2. 35:58

   They're things that you... time of ordering them, you already have an exercise test plan where you plan to expend them, which means that you're going to have to replenish them, which means there's a demand signal to industry to keep going. And in a buying cycle, that means that you can buy the next generation rather than having the old generation. And I think this department sees that in a very clear eyed way and is doing the yeoman's work of like stitching that through, through all the services, all the portfolio acquisition executives, to the point of not believing in process.

3. 36:24

   They've moved from a world where you have a very rigid, hey, I'd said I was going to buy X of Y and I can't change my mind to a world where there's more autonomy and authority for the people who are buying things to say, I told you I was going to buy something that accomplished this goal. I can change my mind about how I'm going to accomplish this goal, which, you know, can you imagine trying to run any private sector business without that degree of autonomy and flexibility in your decision making?

4. 36:48

   To echo Shams' point about what the administration is doing, there are a bunch of swings that they're taking. It wasn't that long ago that in the Obama administration, there was kind of the Solyndra of failure, where they invested in this solar panel company, it ended up being a bad investment for the US taxpayer. But now the Office of Strategic Capital is taking a really hard look at critical minerals, they're looking at, you know, refining of minerals, and they're engaging directly with the private sector to come alongside them in doing deals to get offtake agreements on these things. So I think there is some really clever thinking going on. And then in addition to that, I think the procurement process is sort of up for revision constantly. And Ash Carter started pulling a lot of these threads during the Obama administration. That was the third

5. 37:32

   offset initiative. But we're in a world today where there's kind of a renewed vigor around being asked, private industry being asked, what do you need? Tell us what you need to be changed about the way that we do business in order to streamline this and make it go faster. So I think there's a lot of positive momentum. Do you guys think these changes have been institutionalized or are they political party dependent? If the Republicans lose the midterms and there's a Democrat president in 2028, do you think that there's a reversion to the old way of operating that's going to have some political influence and change things? Or do you think we've really changed how things are running in the government here? I don't think it's political, but I think it's people. So you can go back to, again, Ash Carter, Democratic administration, highly focused

6. 38:17

   on fixing these problems. The current Trump administration, highly focused on fixing these problems. And, you know, there are a lot of people that live, that were in the middle of that, that didn't prioritize this. It wasn't, you know, it didn't rise to the top of the stack. And so I think we always think of like the bureaucracy as being a political infrastructure or an institution or, you know, bureaucracy. I actually just think at the end of the day, it's about leadership. It's just, do we have the right people that understand the set of the problems that we're facing. I couldn't agree more. I mean, I call them heretics and heroes.

7. 38:49

   Like you, you know, the entropy of the bureaucracy is always towards some sort of sclerosis. It doesn't, it's not a political statement. It's just, it's what bureaucracy does. When David Packard, who's probably the last major technology co-founder who served in the Department of Defense, when he came up with the 5,000 series on acquisition, which today we view as just sclerotic BS that's, that's tied us down. Well, he, his document was seven pages long in the years between when he wrote that and now it's 2000 pages. So did he really screw us or did just the entropy take hold? And there was no strong leadership in between to go do the bushwhacking