Innovation and the U.S. Military (Blog Post)

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© edegan.com, 2016

The F-35 Lightning II program between the United States and Lockheed Martin has been described as the perfect example of a modern military R&D disaster. The fighter jet, with its plans to wield literal laser weapons(1), and fulfill multiple roles from stealth to vertical takeoff(2) sounds like something out of science fiction. The program's lofty goals and many setbacks however have caused a political and financial uproar with Politico calling the project "$163 billion over budget [and] seven years behind schedule(3)." From the GAO warnings as far back as 2006(4) that the project would run over budget, to a report in 2015(5) that the F-35 would be "unable to enter realistic combat scenarios unsupported," its safe to declare the project less than a success.

The greatest disappointment from the F-35 program is not the billions of dollars lost in development and back-alley deals, but the harsh wake-up call that the worlds "greatest military," the engine of innovation which help churn out GPS, digital cameras, and microwaves, is no longer working. In classic entrepreneurial fashion however, there is opportunity in this failure. The major failures in the F-35 program reflect the major failures in the system at large including a lack of budgeting, a faulty contracting system, and a discrepancy in innovation.

A 2010 internal pentagon report stated that "affordability is no longer embraced as a core pillar" when asked to comment on the exponential increase in cost for the program. This mentality, spurned by an exorbitant defense budget and limited financial oversight represents one of the core problems with the Department of Defense system of innovation. There is little accountability for an idea being cost effective. This is further exacerbated by the second issue of a faulty contracting system.

When the United States awards multi-billion dollar defense contracts to companies before they have a system of accountability and solid development plan it inevitably leads to disasters such as the F-35 program. Lockheed Martin and other contractors in fact, have very little incentive to do any kind of cost control as the longer they can prolong a contract, the more funding they will receive. This combined with a powerful congressional lobby have allowed the contract system of innovation to fail.

Finally, the very nature of defense innovation has fallen into a discrepancy, where companies are innovating for the sake of innovating, rather than attempting to meet specific goals or fulfill current gaps. Many features of the F-35 have been called out as redundant and unnecessary in our modern world, and many of its "innovations" are mere upgrades and reshuffles of already existing technologies. With all of the above, what is the solution for military innovation?

The RAND Corporation(7) has put forth an interesting idea to handle military R&D in a similar way to many major corporations, by having a strategic investments arm which follows a venture capital model. By investing in smaller companies and lending military resources and expertise to their development teams, a strategic investment wing of the military could help start-ups develop cutting edge technologies at a fraction of the current price. This would solve the key issues, providing a return-on-investment rather than a contract style arrangement with developers, and would focus on true, cost-effective innovation rather than the current overblown targets such as the F-35.

[Check RAND article for other benefits can really be blown out with research]

(1) http://web.archive.org/web/20040626050316/http://www.aviationnow.com/content/publication/awst/20020708/aw32.htm (2)https://en.wikipedia.org/wiki/Lockheed_Martin_F-35_Lightning_II#Armament (3)http://www.politico.com/story/2014/02/f-35-fighter-plane-costs-103579 (4)http://www.gao.gov/new.items/d06356.pdf (5)http://aviationweek.com/defense/test-report-points-f-35-s-combat-limits-0?NL=AW-05&Issue=AW-05_20160201_AW-05_373&sfvc4enews=42&cl=article_1 (6)http://www.reuters.com/article/lockheed-fighter-idUSN1123180820100312 (7)http://www.rand.org/natsec_area/products/vc.html