Becoming a Fast Follower: An Acquisition Perspective
The Department of Defense must embrace commercial technology culture and systems.
BY CHERISSA TAMAYORI
“We will be a fast follower where market forces are driving commercialization of militarily relevant capabilities in trusted artificial intelligence (AI) and autonomy, integrated network systems of systems, microelectronics, space, renewable energy generation and storage, and human-machine interface.”
– 2022 National Defense Strategy1
Historically, the United States has maintained a decisive military advantage over its adversaries due, in large part, to its superior technological capability. The Department of Defense (DoD) harnessed technical resources across industry and used large investments to shape the development of specific military capabilities. These investments led to the creation of technologies such as the internet and global positioning systems (GPS).
Today, global markets drive development of most dual-use and emerging technologies. Rapid advancements in commercial technology, combined with supply chain vulnerabilities, rigid acquisition, and lengthy budget processes render DoD’s traditional approach to technology development and procurement dangerously slow. This is especially relevant as we find ourselves in a threat landscape where speed is the new competitive dimension.
While the DoD continues to develop offensive and defensive capabilities around conventional military platforms, dual-use emerging technologies are changing the nature of conventional military campaigns. This is already evident in Ukraine with commercial satellite imagery, autonomous drones, and the exploitation of communications and social media. Many technologies that previously were available only to nation-states now have become democratized and available to any consumer or adversary.
As the DoD looks to available commercial solutions to address everything from safeguarding the health of military service members, tackling energy challenges, building out our competitive capabilities in space, and aiding Ukraine with commercial technology – the department must embrace commercial technology culture and systems to become a “fast follower” as mandated in the 2022 National Defense Strategy.
Being a fast follower requires changes to all three parts of the defense acquisition system:
Requirements: Eliminate the requirements process for dual-use commercial technologies and replace it with a more rapid validation of needs. Requiring detailed specifications for products the commercial market already builds limits both creative problem-solving and the number of competitors.
Acquisition/Program Management: Simplify the buying process and apply commercial best practices. Fully use the flexible acquisition authorities available to acquisition personnel. This includes the use of the other transaction (OT) authority through commercial solutions openings (CSO), which maximizes competition while minimizing the opportunity costs of participating vendors.
Budgeting: Allow for more flexible budgeting. New commercial solutions enter the market faster than the defense budget cycle and even faster than the refresh rate for traditional defense technologies, which can be decades for major platforms.
Contracting professionals are key to achieving fast-follower status within the acquisition system and changing the way the government procures technology. If we want best-of-breed technology (delivered at speed), then we must become better business partners with our commercial counterparts. The Acquisition Directorate within the Defense Innovation Unit (DIU)2 has been consolidating insights gleaned from partnering with leading-edge commercial technology providers. Here are three takeaways:
1. Understand industry partners and align to common business practices.
Federal contracting professionals must put themselves in the shoes of commercial stakeholders before issuing a request for proposal by considering the following: How burdensome is the request for proposal? Would a non-government entity understand the overarching problem statement and the desired solution attributes? Is the desired end state a product or a service?
Part of putting ourselves in commercial stakeholders’ shoes (and attracting the best technology) means that we need to recognize the opportunity cost companies face when doing business with the government. We must ensure that government needs align with best commercial practices and do not require a company to create government-specific processes, develop costly proposals, or spend a year waiting to learn if it won a contract award.
DIU has a team of technical experts with significant commercial industry experience who advise the rest of the organization on commercial best practices and processes. From these technical experts, we have learned that many companies, especially those supplying software-based technologies, have pivoted to a service-based model. Instead of selling an end item, these companies sell the use of the item as a service, which conveniently includes automatic updates and new versions of software. Acquiring technology via a service model can feel unnatural for many in government, however, getting the best technology requires a mindset shift.
2. Improve market research and conduct constant outreach.
Companies have a choice when it comes to selecting their business partners. We can no longer assume that top technology firms will seek out DoD opportunities.
The DoD needs to proactively build bridges with the private sector to make sure companies are aware of the potential that exists in the federal marketplace and can find opportunities with ease. This is key to ensuring that we are reaching nontraditional defense companies. DIU has ongoing outreach to the commercial market, including regional outreach events. We also have designated a commercial engagement team to work within various innovation ecosystems and meet with companies that otherwise would not be aware of federal opportunities and open solicitations.
3. Use flexible acquisition authorities.
DIU’s CSO process and the resulting OT agreements are examples of a competitive, streamlined acquisition approach to prototyping that lowers the barrier to entry for small businesses and non-traditional defense contractors.
Accessibility is key. DIU problem statements are written in plain language that any commercial company can understand. DIU also posts areas of interest directly on its website, and these are pushed out via email and social media. Responses are limited to a five-page white paper or 15-page slide deck.
Using the CSO, DIU averaged more than 40 proposals per solicitation in fiscal year 2022. The tiered evaluation process informs companies quickly whether or not they have been selected to participate in the next phase. The majority of the work, including developing the statement of work and negotiating terms, is done in the final phase of the CSO so that only companies likely to receive an award expend the additional time and effort required by these tasks.
Understanding industry norms and adjusting the acquisition process to best reflect industry business models will encourage more companies to enter into the defense market. That, in turn, will ensure the DoD is acquiring the best technology available and maintaining its technological advantage.
If you found this helpful, please watch for DIU-NCMA webinars and other updates on social media. For questions, please contact DIU at [email protected]. CM
Special thanks to former DIU Director Mike Brown and DIU Policy Advisor Pavneet Singh for providing the original Fast Follower Strategy language. Original Fast Follower Strategy document is available here for download: www.diu.mil/fastfollower.
Disclaimer: The views, opinions, and assumptions expressed in this paper are those of the authors and do not necessarily reflect the official policy or position of any agency of the U.S. government
Cherissa Tamayori is the Acquisition Director for the Defense Innovation Unit (DIU). DIU is the only Department of Defense (DoD) organization focused on fielding and scaling commercial technology across the U.S. military at commercial speeds. It is focused on six technology areas where the commercial sector is operating at the leading edge: artificial intelligence, autonomy, cyber and telecom, energy, human systems, and space. DIU partners with organizations across the DoD, from the services and components to combatant commands and defense agencies, to rapidly prototype and field advanced commercial solutions that address national security challenges.
ENDNOTES
https://www.diu.mil/
https://www.defense.gov/National-Defense-Strategy/