lessons on defense research and development management

48 Pages·2014·4.15 MB·English

iRsE SthEAeR CInH sNtOitTuESte for Defense Analyses, a non-profit corporation
operating in the public interest.
IDA’s three federally funded research and development centers
provide objective analyses of national security issues and related
national challenges, particularly those requiring extraordinary
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The articles in this edition of IDA Research Notes were written by
researchers within the following four IDA divisions. The directors of
those divisions would be glad to respond to questions about the
specific research topics or related issues.
Cost Analysis and Research Division (CARD)
Dr. David J. Nicholls, Director (703-575-4991, [email protected])
Information Technology and Systems Division (ITSD)
Dr. Margaret E. Myers, Director (703-578-2782, [email protected])
Science and Technology Policy Institute (STPI)
Dr. Mark J. Lewis, Director (202-419-5491, [email protected])
Strategy, Forces and Resources Division (SFRD)
Mr. Michael Dominguez, Director (703-845-2527, [email protected])
Institute for Defense Analyses
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TECHNOLOGICAL INNOVATION FOR NATIONAL SECURITY
Sustaining technological superiority in Early decisions were focused on whether a
an era of globalization is a major challenge proposed development was appropriate to
for the U.S. national security community. meet real needs effectively and affordably
This edition of Research Notes focuses on with sound technical and operational
technological innovation—how the United concepts. The author suggests that OSD
States and others are pursuing it today, and consider reinvigorating its role in R&D
the challenges and opportunities in fostering management—especially at the front end of
innovative technological developments to proposed new developments and in initiating
meet future national security needs. The innovative technological and operating
individual articles summarize insights gained concept approaches outside traditional
from past IDA research conducted for the military department interests.
Department of Defense (DoD) and other
Commercial industry also has had
federal government organizations.
to grapple with the issues of fostering
In the first article, Andrew Hull and and managing innovation in a globalized
David Markov emphasize that innovation economy. The article by Richard Van Atta
in the security arena is now a global shows how leading firms have effectively
enterprise. This is particularly evident in employed new models and approaches
the international arms market. Nations now for innovation. Many firms have instituted
have considerable flexibility and options highly focused management methods to
for meeting their defense technology foster innovation—not just invention.
requirements. These options ensure the end Today’s successful industry innovation
products more closely meet the buyer nations’ stemmed from systematic and concerted
operational requirements and (in some cases) identification and exploitation of global
allow the nations’ entry into areas previously expertise—including open innovation,
denied them. Governments and defense firms collaboration, and teaming—to solve difficult
of other countries are employing different problems and reduce the costs and time
approaches for acquiring defense capabilities associated with implementing technologies.
that can collapse timelines and accelerate Implementing this new organizational model
technical innovation. This, in turn, will for innovation often required enterprise-wide
challenge DoD to maintain U.S. leadership in transformation—typically led by the CEO and
critical technical areas in the next 10 to 15 his executive team—that broadly affected
years. business practices and processes.
Getting early decisions on new systems Building on its assessment of commercial
right—ensuring adequate attention is given R&D management, IDA compared DoD’s
to the critical “What to Buy” decision—is Laboratory Enterprise to the best practices
crucial in DoD acquisition. Gene Porter of commercial industry as summarized
addresses lessons on Defense Research and in the article by David Graham, Robert
Development (R&D) management from the Leheny, and Susan Clark-Sestak. The authors
1960s through the 1980s, when the Office observed that the labs’ close ties to their
of the Secretary of Defense (OSD) played parent military departments can create
a strong role in setting the innovation gaps in coverage in potentially important
strategy and in providing senior management areas. Large commercial firms have parallel
oversight of new acquisition system choices. challenges to those of DoD as they too
3 www.ida.org 3
face tensions between the highly focused Jocelyn M. Seng and Pamela Ebert
improvements in existing products and Flattau next discuss the challenge of DoD
more open-ended enterprise-wide innovation sustaining the quality and availability of
needs. IDA researchers identified common civilian scientists and engineers in today’s
commercial industry practices designed to global economy. Significant uncertainties
overcome these weaknesses and encourage exist regarding the future supply of scientists
enterprise innovations. The IDA research team in various academic disciplines as well
recommended stimulating DoD laboratory as the future demand for scientists and
innovation through a “virtual central engineers in the evolving global environment.
laboratory,” which would identify and fund The overarching question is whether DoD
DoD laboratory projects addressing DoD-wide will maintain access to the pool of talent
innovation needs. The Department has moved needed to ensure that it will keep pace with
to implement this recommendation. technology developments across the globe.
The authors assessed recent trends in the
One major challenge for the DoD R&D science and engineering (S&E) workforce
enterprise, addressed in the next article by and offered suggestions regarding policies
Susannah Howieson, is developing effective and practices that could help ensure future
processes to determine how to prioritize workforce viability.
and support the facilities and infrastructure
needed for effective laboratories. The In the final article, Susannah Howieson
assessment identified concerns related to and Stephanie Shipp summarize IDA
meeting infrastructure needs and practices research identifying exemplar practices for
to address them. A broader area of R&D DoD technology transfer. The research team
management explored by IDA is laboratory identified more than 20 practices that have
governance: What features of how the been employed effectively in such areas
laboratories are operated and overseen affect as empowering, training, and rewarding
their ability to effectively address future scientists and engineers and capturing and
national security challenges? managing intellectual property.
4 RESEARCH NOTES
ACQUISITION IN A GLOBAL
TECHNOLOGY ENVIRONMENT
Andrew W. Hull and David R. Markov
The Problem
Governments and defense firms of other countries are experimenting
with different approaches to acquiring defense technological
capabilities. These strategies collapse timelines of worldwide defense
acquisition and accelerate technical innovation. This, in turn, will
challenge the Department of Defense to maintain U.S. leadership in
critical technical areas in the next ten to fifteen years.

Introduction
Today’s global
Other nations have changed their approach to defense
defense industry
acquisition over the past two decades. During the cold war,
is becoming highly
nations had basically two choices: 1) “go-it-alone” and rely almost
exclusively on domestic defense research, development, test, and competitive,
evaluation (RDT&E) assets and their industrial base or 2) purchase more customer-
finished systems from third parties—the performance of which oriented, more
was usually optimized to meet the military requirements of the
responsive to
supplier, not the importing customer.
market demand,
Globalization of the international arms market has changed and more cost
that paradigm. Nations now have a good bit of flexibility and many conscious.
more options for meeting their defense technology requirements.
These options ensure the end products more closely meet the
buyer nations’ operational requirements and (in some cases) allow
the nations’ entry into areas previously denied them because of
cost, technical difficulty, lack of infrastructure, and/or export
restraints by developers. Today, defense acquisition is, indeed, a
“brave new world” for most countries.
Today’s global defense industry mirrors the commercial
sector. It is becoming highly competitive, more customer-oriented,
more responsive to market demand, and more cost conscious.
There is now a greater degree of civil-military integration in many
countries. Consequently, defense planners in some nations, such
as China, now specifically advocate “spinning-on” commercial/
dual-use technologies for military applications, increasing the
chances of asymmetric technology applications. Market pressures
and fierce commercial competition among defense firms for
exports also serve as forcing functions in speeding products from
research and development (R&D) to serial production, increasing
the overall pace of global defense technological innovation. This
also facilitates the distribution of military operational capabilities
(e.g., stealth, night vision, networked systems) to a wider and more
diverse set of nations and non-state actors than ever before.
www.ida.org 5
Alternative Acquisition Privatization of the
Strategies Acquisition Process
(United Kingdom)
Defense acquisition in the cold war
basically followed either of two paths: Privatizing is closely related to
self-reliance on domestic resources and the previous approach in that it, too,
infrastructure or purchasing one-size- seeks to employ outsourcing, this
fits-all systems from other nations. In time turning public functions over
a few cases, a nation (e.g., India) would to the private sector on a contract
selectively employ both approaches basis in hopes of reducing costs
simultaneously depending on the and increasing the efficiency of the
nature of the capability required. acquisition process. In 2009, then
While some nations still follow these Chief of Defence Materiel Bernard
traditional models, others are pursuing Gray proposed a radical change to
different acquisition strategies and the British Ministry of Defence’s
even following more than one of these (MOD) basic approach to acquisition:
strategies at the same time. i.e., “letting the private sector run
Defense Equipment and Support”
Concentrate on Core
(RUSI Acquisition Focus Group 2012).
Competencies, Out Source Gray’s proposal envisioned replacing
the Rest (Russia) the government employee staffed
Defence Equipment and Support
To increase the export potential
(organization), which is responsible for
of “big-ticket” military product lines,
buying and supporting all army, navy
the Russian defense industry has
and air force equipment and services,
reached out, especially to France,
with a government-owned, contractor-
for military technical cooperation at
operated (GOCO) entity.
the component level in areas where
Russian industry is weak. For example, Considering implementing the
the France-based manufacturer, Thales idea, the British MOD did what it called
Optronics, supplies the Catherine- “soft market testing” in the summer
FC thermal imager for Russian T-90S of 2012 and attracted foreign as well
tanks, as well as helmet and sighting as domestic bidders (RUSI Acquisition
system for MiG-29 fighters sold to Focus Group 2012). In 2013, the
India (“The Cooperation of Russia MOD chose not to proceed with the
and France in Industrial Defense proposed GOCO approach, leaving
Can Significantly Increase the Export many questions connected with this
Potential of Two Countries (the Visit acquisition management strategy
of Anatoly Serdyukov, in Paris)” unresolved: For what period would
2010). Russia is also seeking military the company be appointed? Would
technical cooperation with Armenia, the GOCO be responsible for making
Kyrgyzstan, Belarus, and other former decisions or just giving advice? Would
Soviet republics to replace suppliers the company have the legal status
lost in the breakup of the Soviet Union, of principal or just be an agent of
in lieu of developing those capabilities the MOD? How would the company
afresh in Russia. handle American foreign military sales
(FMS) transactions or participate in
6 RESEARCH NOTES
international programs? What financial a Chinese-built hull filled with a
risks would the GOCO be asked to take? mixture of Russian, French, and
How would the private company make Chinese systems (“Type 052C
money and the MOD save money at (Luyang-II Class) Missile Destroyer”
the same time (RUSI Acquisition Focus 2009). Indigenous systems included
Group 2012)? a four-array, multi-function, phased
array radar, HQ-9 air defense missile
Crawl, Walk, Run (People’s system, and YJ-8 series anti-ship
Republic of China and India) cruise missiles. The ship’s 100mm
main gun was a Chinese derivative
The upgrading and modernization
of the French Creusot-Loire T100C
of the People’s Liberation Army
design, and the command and control
of China have been accomplished
system was derived from the French
using what might be called a “crawl,
Thomson-CSF TAVITAC. The Type
walk, run” approach over the last
052C also carried Russian-made fire-
two decades. The first (crawl) phase
control radar for the anti-ship missiles
entailed buying finished weapons
and main gun, as well as a Russian Ka-
systems off the shelf and acquiring
28 ASW helicopter.
licenses to manufacture some of
those products domestically. For The third (run) phase is
example, China initially purchased characterized by products of
Su-27 fighters from Russia in 1992 indigenous design and production.
and then ordered a second batch in Examples of run phase products
1993. Three years later, China acquired include the Chinese J-10 fourth
the rights to manufacture Su-27SK generation fighter (see Figure 1)
variants. Under that agreement, Russia (currently using Russian engines
would supply the aircraft in kit form while problems with Chinese aircraft
for final assembly in China, as well as engines are being worked out) and
the avionics suite and AL-31F turbofan J-20 fifth generation fighter as well as
engines. In-country production was Type 99 main battle tanks.
sometimes facilitated by foreign
India is trying to pursue the crawl,
vendors sending specialists to China to
walk, run phases simultaneously,
help get the initial licensed production
with heaviest emphasis on the crawl
process started (“Su-27SK/UBK Air
Superiority Fighter Aircraft” 2008).
The second (walk) phase featured
hybrid systems that consisted of
foreign systems (or derivatives of
foreign systems) to which sub-systems
developed and produced in the People’s
Republic of China were added. The
Chinese were aided in the indigenizing
process by the ability to purchase
Russian engineering and design know-
how on a contract basis. An example
of this approach is the Type 052C Figure 1. Cutaway Model of J-10
(Lyuang II class) destroyer, which was Fighter Displayed at AirShow China 2012
www.ida.org 7
phase at present. Sixty-five years after defense research base has also worked
its independence, India still imports on a host of projects, such as the
as much as 70 percent of its weapons Akash medium-range surface-to-air
and defense equipment (“Dependence missile, Arjun tank, and Nag anti-
on Defense Imports Risky for India, tank guided missile (ATGM), all of
Say Experts” 2012). In a few cases, like which were designed to compete with
T-90S tanks and Su-30MKI aircraft, foreign suppliers for the same Indian
these foreign products are assembled military requirements. They failed
from kits in India. This situation for a variety of reasons including
persists despite decades-long Indian cost, performance, and extended
government investments at 50 state- developmental timelines.
owned defense R&D laboratories and
Indian political and military
40 defense plants to create indigenous
leaders recognize that, according to
defense systems.
Air Marshal J. Chandra, air officer
These domestic facilities are, commanding-in-chief (Maintenance
however, engaged in some walk Command), “strategic self-reliance is
projects that differ from the Chinese a key result area for defense sector
walk approach in that they start with in the years to come” (“Dependence
Indian-designed basic platforms on Defense Imports Risky for India,
that rely extensively on foreign Say Experts” 2012). Indeed, there is
components for key operational a “made-in-India” policy initiative
capabilities. Hindustan Aeronautics that seeks to reverse the current
Limited’s Dhruv attack helicopter, for 70/30 ratio of imports to indigenous
example, was designed in India, but production. Such a policy has been
also includes major foreign content: tried before and failed.
hydraulic systems from the United
China and India offer contrasting
Kingdom (UK), avionics from Israel
cases. China approached the crawl,
and the United States, self-protection
walk, run strategy as essentially
equipment from Sweden and South
a sequential process while India
Africa, engines from France, flight
attempted to implement a process
controls from Germany, and a braking
where all three phases were
system from Italy. The ratio of Indian
undertaken simultaneously. The
to foreign content in walk projects is
Chinese approach appears to have
often quite small. For example, the
succeeded while the Indian approach
Dhruv attack helicopter has only 10
has not yet produced similar results.
percent and the light combat aircraft
has only 30 percent Indian content
Fellow Travelers (Russia and
(Purushottam 2011).
India, European Union)
India has also pursued some run-
type projects: Agni and Prithvi ballistic Countries no longer need to “go
missiles, space launch/satellites it alone” when developing military
and counter-space equipment, and systems because of the proliferation
ballistic missile defenses. Generally, of multi-national joint ventures. Multi-
these were technologies that were national consortiums can sometimes
not available for import. The Indian afford projects and combine
8 RESEARCH NOTES
technological skills to develop and manufacturers. The consortium
field military systems beyond the makes a wide variety of civil and
financial and technical capabilities military aircraft at sixteen sites in
of any one of its members. For four European countries. Military
example, the Defense Research and products include the A400M military
Development Organization of India transport, A330 MRTT (multi-role
and Russia’s NPO Mashinostroeyenia tanker transport), C212 light tactical
formed a joint venture called transport, the multi-role CN235
BrahMos Aerospace Ltd. to market tactical airlifter, and C295 tactical
supersonic BRAHMOS anti-ship and airlifter, a stretched version of the
land attack cruise missiles (see Figure CN235.
2). Collaboration made it possible to
The Eurofighter/Typhoon
share the technological assets of both
consortium is a third instance. In
countries, with India providing inertial
1986, companies from Germany,
navigation systems, mission software,
Italy, Spain, and the UK pooled their
and mobile launcher technology,
resources to build a next generation
and the Russians supplying ramjet
fighter—a project no single European
technology and cruise missile
country could afford. A similar
airframes. The Indian side brought
approach was used to develop the
significant financial support as well.
engines and radar. Eurojet Turbo
Subsequently, BrahMos Aerospace
GmbH was set up by Avio (Italy), ITP
Ltd. announced a second project to
(Spain), MTU Aero Engines (Germany),
co-develop a hypersonic cruise missile
and Rolls-Royce (UK) to develop the
called BRAHMOS II.
EJ200 engine for the new fighter
Airbus is another example of aircraft. Likewise, the Euroradar
this approach. Unable to sustain consortium brought together EADS
economically viable standalone Defense Electronics (Germany), SELEX
national aerospace industrial Galileo (UK and Italy), and INDRA
bases, BAE Systems and EADS (Spain) to design, develop, and
formed a consortium of aerospace produce the advanced Captor radar
(“Eurofighter Jagdflugzeug GmbH”
2013).
Joint Ventures Plus
Contracts That Result
in Transfer of Skills and
Technology (United Arab
Emirates, Indonesia, and
India)
This approach usually involves
a technologically advanced, but
funds-limited, company pairing
with a technologically limited, but
Figure 2. BRAHMOS Inclined Launcher ambitious, partner with ample funds.
at Defense Service Asia 2012 The resultant “marriage” provides
www.ida.org 9
the original developer with sufficient Pantsir-S1 (SA-22 Greyhound) surface-
funds to bring a project to completion to-air missile in exchange for regional
and the technologically ambitious marketing rights (see Figure 4). Emirates
partner with access to advanced Advanced Research and Technology
technologies and know-how. Holding (EARTH) and Yugoimport also
The United Arab Emirates (UAE)
is making a major effort to build
domestic defense manufacturing
capabilities to diversify its economy
as well as to reduce its dependence
on military imports with too many
strings attached. Thus the UAE is
establishing a small defense industry
located primarily in a city between
Dubai and Abu Dhabi. Interest
extends to maintenance and repair Figure 4. Pantsir Air Defense Missiles-
of defense systems as well. The UAE Gun Complex at IDEX 2011
is using a strategy that combines
signed an initial agreement at IDEX
joint ventures with foreign firms
2013 to jointly develop the fiber-
and defense procurement contracts
optic guided Advanced Light Attack
that commit foreign companies to
System (ALAS-C) missile intended for
transferring technology and skills
coastal defense, anti-ship, and land
to the UAE. The Multiple Cradle
attack roles. According to the deputy
Launcher (displayed for the first time
director of Yugoimport, “This is a
at IDEX 2013) is an example of this
big investment that will significantly
process (see Figure 3). The Multiple
speed up the current process and new
Cradle Launcher was designed with
technological capabilities in the field
the help of a Serbian contractor and
of sophisticated missile technology,
then assembled and integrated in
and the development of sensors for
the Emirates. In another case, the
missile guidance and control” (“Serbia
UAE supplied money for Russia’s
UAE Firms to Develop Missile” 2013).
KBP Instrument Design Bureau to
finish final development of the
Indonesia, to gain access to
advanced technology, signed an
agreement with South Korea in
August 2012 to participate in an R&D
program to produce an advanced
multi-role combat aircraft by 2020.
In return for paying up to 20 percent
of development program costs,
30 scientists and engineers from
Indonesia’s state-owned R&D agency
and aviation company, PT Dirgantara
Figure 3. Multiple Cradle Launchers at Indonesia (PTDI), would be permitted
International Defense Equipment to participate (Hardy and Grevatt
Exposition (IDEX) 2013 2013). These Indonesian engineers
10 RESEARCH NOTES