Guest post written by
General Norton A. Schwartz, USAF (ret.) and Maurice R. Greenberg
Mr. Schwartz is president & CEO of Business Executives for National Security. Mr. Greenberg is chairman & CEO of C.V. Starr.
Remember that time is money. In his oft repeated aphorism Benjamin Franklin reminds his reader that the proper management of time is directly related to success. Two centuries later, consulting guru George Stalk further refined Franklin’s axiom, observing “…as a strategic weapon, time is the equivalent of money, productivity, quality, even innovation.”
The Department of Defense would be wise to embrace the strategic potential of speed. Proper time management can enable rapid adaptation and innovation, thereby allowing the U.S. to maintain its strategic edge over its peers. Unfortunately, the Department has failed to efficiently manage time, to the potential detriment of our military readiness.
Readiness is generally defined as the ability to project and employ the right forces, with the right capability, at the right time. However, even as the private sector continues to innovate at a breakneck pace, the Department’s current testing, development and acquisition bureaucracy is proving too slow to deliver advanced capability appropriate for warfare in the 21st century. What is true of operational planning – the imperative to out-cycle one’s enemy – is just as true in areas of management and organization.
Successful segments of the private sector understand that time is a resource to be capitalized. The goal of delivering “in-time” capability to the market is to gain an advantage over competitors. The Department understands this concept in principle as evidenced by the Defense Innovation Initiative and Third Offset Strategy. However, the mechanisms are not in place to achieve desired outcomes.
Three critical requirements are necessary
Companies that have thrived in the modern age have done so because they understand the need for strong leadership to implement three critical requirements necessary to achieve the speed and effectiveness required to compete successfully: efficient processes; properly aligned incentives; and a culture that accepts failure.
The first requirement is a process that allows for rapid acquisition and fielding. Private industry maintains agility in large part by creating governance structures that are event-based and designed with a bias for action. The Defense Acquisition Management System is event-based, but those events are punctuated by a byzantine series of milestone reviews and decision points. Efficient processes also require enabling authorities and policies. Oversight is important, but so is a process that is engineered for speed and iterative decision-making. Complexity is to be avoided while consistency is to be maximized. In government today, Continuing Resolutions and the application of year-to-year accounts such as Overseas Contingency Operations do nothing to encourage timely adaption.
Properly aligned incentives
The second requirement is properly aligned incentives. Whether a defense acquisition professional, staff member or political leader, the incentives are to say no. In the private sector, incentives are applied at both the individual and programmatic level; helping to build an overall culture in which calculated risk is tolerated and even encouraged. Incentives are promoted through a reward system that allows for an enterprising and exceptional individual to be promoted. This is a culture with a streak of venture capitalism.
In early 2013, Netflix responded to an increasingly crowded streaming marketplace by shifting its business model from content curator to content creator. In undertaking such a fundamental shift, Netflix assumed the additional risk associated with a large entertainment studio. As fellow high-tech entrepreneur Mark Zuckerberg has stated, “in a world that is changing really quickly, the only strategy that is guaranteed to fail is not taking risks.”