Innovate. Act like entrepreneurs. Take smart risks. Fail fast.

By now, who hasn’t heard these exhortations and others just like them 100 times or more?

Federal acquisition and contracting professionals are too risk-averse and too slow and don’t understand industry. As a result, the cool companies don’t want to play in the federal sandbox, so we are becoming easy pickings for China and Russia and our own people are frustrated and unhappy with government.

The blaming continues under each new presidential administration and the burden gets heavier every time.

What if we stopped vilifying the contracting corps and instead taught its members how to take smart risks and rewarded them for doing so, no matter the outcome?

That’s exactly what two outstanding acquisition leaders advise, and their thoughts are well worth listening to and taking on. It’s past time to replace blame with training and incentives if we truly want our buyers to take chances on novel approaches and new authorities to attract unknown but innovative suppliers.

Military combat leaders “train and study and review and practice over and over again in ever-more complex scenarios so that they are as ready as possible to handle real risk,” says Peter Newell, former director of the Army Rapid Equipping Force and now head of a Silicon Valley consulting firm and tech accelerator, BMNT.

The acquisition corps should train in risk-taking, too, he says.

“Dying” repeatedly on practice battlefields and learning why each time gave Newell the confidence to make life and death decisions in combat in Iraq and to help Silicon Valley entrepreneurs take educated risks to grow their companies.

Similarly, William Roper, Air Force acquisition chief, credits his rise inside the Defense Department in part to being given opportunities to take limited risks. But only because they worked out.

In his first government post, Roper was given $10 million to place a bet on one system—reprogramming a defensive Navy interceptor, Standard Missile 6, to do an offensive strike mission. The reprogramming worked and turned out well for the Navy and for Roper, but he wonders to this day what would have happened had it not worked out.

“The fact that I was able to do it was only found in the doing. The fact that we committed to take the risk was done without that knowledge. So, I ask myself, would I have been able to continue to be allowed to do those kind of programs had it not worked out? I think the answer is no.

“I realize I’m the beneficiary of a double standard, and what I see here in the Air Force is that we often talk with people who are risk-takers who got lucky. You get people like me who love to talk about taking risks because we benefited from it. And I realize there’s hypocrisy in that.”

“A good risk is a good risk, regardless of the outcome.”

“There’s a risk-reward calculus we should judge people on. So, I’m trying to be very mindful with Air Force program managers and people taking risks that they get their evaluation and validation from me at the point that they take the risk. If they made a smart choice, ‘You’re a success, you’re a winner, you’re a rock star!’ Whatever happens because of it, that’s a roll of the dice.

“I feel like with risk-taking you only hear the side of the people who rolled the number that they needed.”

The wisdom to make such smart choices in battle comes from many repetitions in varying conditions and a multitude of rehearsals before an attack, Newell says. Proper understanding of the risks embedded in a specific situation also requires people with diverse backgrounds working in concert. Even more important, Newell points out, is that a focus on reducing malfeasance via contracting rules and procedures forestall smart risk-taking and deprive us of opportunities to build the best fighting force and government services.

“In today’s fast-moving era, the ability to spot and seize on an opportunity may determine the success or failure of a company—or a military,” Newell says.

So, he suggests applying what the military has learned about developing its leaders to developing the acquisition corps:

  1. “Commit resources to recruit, grow, and retain experienced leaders who understand the battlefield, are technologically competent, and can manage risk like battlefield commanders and Silicon Valley entrepreneurs do” by creating places to practice before the risk of failure becomes s too great
  2. Advance and reward those who are highly adaptive and creative in addressing emerging problems—especially without guidance.
  3. Develop a doctrine for innovation creating a common language for entrepreneurial leaders and connects their actions to warfighting objectives.
  4. Develop a professional military and civilian education roadmap for lifelong learning that embeds innovation doctrine through degree-producing programs and fellowships in National Security Innovation and Entrepreneurship in service schools and civilian universities.

These recommendations can be refined, but at least they offer more than mere cheerleading to help contracting professionals answer the call to innovate and take risks. Who now will take up the challenge and make them real?



Thoughtful commentary every week from Anne Laurent and the community about trends, surprises, lessons, and cautions in pursuit of Acquisition Innovation.

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