2026-02-10 22:00:42
And ye shall know the truth, and the truth shall make you free” John 8:32
Every once in a while you learn something new that makes you completely rethink how/why an event actually happened.
And then you consider how it affects the rest of our country and our lives.
This is one of those stories.
Over a decade ago, I was a public official and was at one of our commission meetings on the coast of California. A fellow commissioner and I decided to take a long lunchtime walk along the coast. As we chatted, we realized we had both worked on several of the same very classified programs. His involvement was in acquisition and finance, while mine was more deeply connected to the engineering development of the project and hands-on with the operators on site.
We Got Our Advanced Technology From Aliens
While we both were discreet about not talking about specifics, we recognized the projects we had worked on. So you can imagine my surprise when he turned to me and casually said, “You know this technology came from aliens.” I laughed, thinking that obviously he must be joking. But as we continued walking he continued on, claiming, “You know the equipment you worked on and stuff that followed came from our secret alien investigation site at Wright Patterson Air Force Base. All we did was reverse engineer Alien technology.” This time I stopped in my tracks and looked at him to see if he was smiling. I was puzzled as he looked dead serious. He explained that there was no possible way we could be doing what we were doing using existing technology. Before I changed the subject I asked him how he knew this, he replied with absolute sincerity, “I was head of acquisition on the program. I was briefed on the project. That’s what they told us and they swore us to secrecy.“
I really didn’t know how to process this. He was really a smart and level-headed guy. In fact he was the mayor at the time of Rancho Palos Verde. It took me a mile or two into our walk to rethink everything I knew about the project (even then it had been in decades past), including having sat with a few of the engineers (some strange, but not aliens) as they were designing the system (with me trying to keep up with the revised blueprints in document control), and then watching the system being built and assembled. While it had required incredibly creative engineering, and applying technology on a scale so massive no commercial company could afford it, this system was built by smart people with no aliens involved. But he was equally convinced they were. Over our time together on the commission we took more walks, had lots more to talk about, but we never broached the subject again.
Every once in a while, for the next few years, I puzzled on how he could have been so sure of something that I was sure was completely wrong.
We Did Tell Them It Was Aliens
Fast forward 15 years, and my world view of that conversation was upended when I read in the Wall Street Journal that the Department of Defense had been running a disinformation campaign, briefing finance and acquisition people that the technology for these classified programs was coming from aliens. (Take a minute and read the article.)
All of a sudden our coast-side conversation from a decade and a half ago made sense to me. Most of our most compartmentalized programs have different levels of what was called “need to know.” I never paid much attention as I was read all the way into the technical and operational details of these programs. I vaguely knew that others got fewer details, but as I was just discovering, others had received active disinformation. In a few cases, security officers were even using fake photos and documents to create the Alien cover-story for secret-weapons programs.
It turns out my fellow commissioner had been briefed by the U.S. government that it was Aliens, and he went to his grave believing it so.
Are you going to believe me or your lying eyes?
What’s interesting is what happened after the news came out that the Alien story was government disinformation. A large percentage of people who were briefed, now “doubled down” and believed “we got the technology from Aliens” even more strongly – believing the new information itself was a coverup. Many dismissed the facts by prioritizing how they felt over reality, something we often see in political or religious contexts. (“Are you going to believe me or your lying eyes?”)
I wondered how my friend would have reacted.
Secrecy, Disinformation, and a Higher Power
While on its face this is an amusing story about secrecy, it’s really about the intersection of the secrecy’s impact on society and its role in misinformation, manipulation, the creation of cynicism and mistrust, and our need to believe in a higher power.
Manipulation
An example of secrecy used for manipulation in the 20th century was when the National Security Agency Venona project unmasked Soviet spies in the U.S. Even though this was one of the nation’s most secret programs, the FBI leaked its findings to Joe McCarthy and Richard Nixon. They used this classified knowledge to manipulate the American public, fueling McCarthyism and Richard Nixon’s career. 50 years later, when Venona was made public historians substantively revised the history of U.S. Cold War politics.
In the 21st century Social Media misinformation (e.g. Chinese and Russian influence campaigns, Qanon conspiracies) will look like toys next to the AI-driven manipulation that’s about to come.
Cynicism and mistrust
Secrecy created 75 years of cynicism and mistrust, when the U.S. began launching highly classified reconnaissance balloons (story here), and later the U-2 and SR-71 spy planes. These top secret projects gave rise to decades of UFO sightings. Instead of acknowledging these sightings were from classified military projects the Department of Defense issued cover stories (“you saw weather balloons”) that weren’t believable.
Governments and companies have always kept secrets and used misinformation and manipulation. However, things stay secret way too long – for many reasons – some reasonable (we’re still using the same methods – reconnaissance technology, tradecraft, or, it would harm people still alive – retired spies, etc) or not so reasonable (we broke U.S. or international laws – COINTELPRO, or it would embarrass us or our allies – Kennedy assassination, or the Epstein files).
Secrecy increases the odds of conspiracy beliefs. Because evidence can’t be checked, contradictions can’t be audited, a government “cover-up” becomes a plausible explanation. People don’t tolerate “I don’t know” for long when stakes are high (stolen elections, identity, national crises, the meaning of life, or what happens when we die). That vacuum gets filled by the most emotionally satisfying model: a hidden “higher power” concealing information and controlling events.
Summary
Just as social media replaced traditional news sources, AI-driven summaries of current events are likely to replace our understanding of the world around us. What happens to trust when AI manipulates human’s tendency to embrace conspiracy theories? Who will define the truth in the brave new world?
And by the way, I’m still pretty sure we didn’t get it from Aliens.
2026-02-03 22:00:08
This article previously appeared in Defense Scoop
The Department of War (DoW) senior Acquisition leadership (the people who decide what and how the DoW buys equipment and services) now is headed by people from private capital (venture capital and private equity.)
The Department of War is in the midst of once-in-a-lifetime changes of how it acquires weapons, software and systems. The new Warfighting Acquisition System rewards speed and timely delivery of things that matter to the Warfighter. But this new system is at risk of making the wrong things go faster.
Here’s why and what they should do.
What Now?
Acquisition in the DoW is being reorganized how a Private Equity would reorganize a large company. They bring in (or empower) a new operating team, swap executives, change incentives, kill things not core to their mission, cut costs, invest for growth, and restructure to find additional financing.
That’s being played out at the Department of War right now. The announcement of the consolidation of individual weapons systems (each of which had their own silos of Requirements, Test/Evaluation, Budgeting, and Acquisition) into a unified Portfolio Acquisition Executive, is a classic Private Equity strategy. Instead of 100s of programs operating with separate budgets, across different Program Executive Offices, the intent of the Portfolio Acquisition Executives is to consolidate overlapping programs, eliminate the redundant ones, pick winners, kill losers, get rid of processes that kill speed, and focus on rapid deployment.
What’s Missing?
Organizing by Portfolio Acquisition Executives is a great start, but simply consolidating the parts of the defense Acquisition system that were broken under one umbrella organization won’t make it better. Making bad ideas go faster should not be the goal. However, we’re at risk of doing just that. (Pete Newell at BMNT has been reminding me of this for years.)
For example, many of these new Portfolio executives are managing their programs by holding monthly reviews of proposed investments and current portfolio performance (just like private investors.) Here they’ll decide which programs get funded, which get more funding, and which should stop. (Actually having a regular process to kill programs early is sorely needed.) These are great ideas. However, if the meetings start by reviewing progress of prototypes to show that the technology works or that warfighters want it, and funds progress on those metrics, it misses the changes needed in an effective acquisition system.
The result will be building a faster version of a weapons requirements process that starts with a top-down list of features, or worse, shiny tech products (e.g. “I need drones.”) This “requirements first” process is what will drive the “bad ideas faster” problem.
A more productive approach – one that delivers truly decisive capabilities – would be to build a different process upfront – a rigorous problem identification and validation phase on the front-end of every acquisition program.
This process would start with a wide funnel of problems, ideas, technology, each with a 10-line problem summary that describes the specific challenge to address; why it can’t be solved currently; what it will take to solve it; and how a solution will be funded and deployed in the field.
The goal would be to 1) consolidate problems that may be different descriptions of the same core problem, and/or 2) discover if the problems are a symptom of something more complex.
Then each problem would go through an iterative process of problem and technical discovery. This will help define what a minimum deployable product and its minimum constraints (security, policy, reliability) should be, such as how long the solution would take to deploy, the source of funding for scale and who needs to buy-in.
This exercise will keep the focus where it needs to be — not on reforming a system but on delivering things to warfighters with speed and urgency so we can actually deter or win a war.
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2025-12-16 22:00:35
TL;DR DoW Directory revision 3 is Online here, Order a print copy here.
In November 2025 the Department of War (DoW) unveiled the biggest changes in 60 years of how they will buy weapons and services. This month Congress, with bipartisan support, rapidly made them into law in the National Defense Authorization Act (the NDAA) – 3,096 pages of legislative text and 636-page Joint Explanatory Statement.
This is a top-to-bottom transformation of how the DoW plans and buys weapons, moving from contracts that prioritized process and how much a weapon costs, to how fast it can be delivered. It’s the Lean Startup plan for the Department of War.
Instead of buying custom-designed weapons, the DoW will prioritize a “commercial first” strategy – buying off-the-shelf things that already exist and using fast-track acquisition processes, rather than the cumbersome existing Federal Acquisition Regulations. To manage all of this, they are reorganizing the entire Acquisition ecosystem across the Services.
December 2025 Directory Update – Now Available Online and in Print
Our December 2025 update to the Directory (Online here, Print copy here) describes the New Warfighting Acquisition Organizations – The Portfolio Acquisition Executive and the Capability Program Managers.
If you’re a startup trying to sell to the DoW, until now the biggest barrier has been a lack of information. That changes with this 3rd edition of the 2025 DoW Directory.
Online here, Order a print copy here.
2025-11-11 22:00:12
Last week the Department of War finally killed the last vestiges of Robert McNamara’s 1962 Planning, Programming, and Budgeting System (PPBS).
The DoW has pivoted from optimizing cost and performance to delivering advanced weapons at speed. Taking decades to deliver weapons is no longer an option. The DoW has joined the 21st century and adopted Lean Methodology.
Two organizations ought to be very concerned – China and the defense prime contractors.
Secretary of War Pete Hegseth unveiled the biggest changes in 60 years of how the Department of War (DoW) plans for and buys weapons and services. These changes aren’t a minor attempt at reform. It’s a top-to-bottom transformation of how the DoW plans and buys weapons, moving from contracts that prioritize how much a weapon costs to how fast it can be delivered.
Instead of buying custom-designed weapons, the DoW will prioritize buying off-the-shelf things that already exist, and using fast-track acquisition processes, rather than the cumbersome existing Federal Acquisition Regulations. To manage all of this, they are reorganizing the entire Acquisition ecosystem across the Services. These changes implement every piece of good advice the DoD had gotten in the last decade and had previously ignored.
The DoW is being redesigned to now operate at the speed of Silicon Valley, delivering more, better, and faster. Our warfighters will benefit from the innovation and lower cost of commercial technology, and the nation will once again get a military second to none.
It’s big, bold and brave and long overdue.
Background
In 1962 Robert McNamara, the then-Secretary of Defense (and ex CFO of Ford), discovered he had inherited a Defense Department whose spending was out of control. During the 1950s the Air Force built five different types of fighter planes, three generations of bombers, and three generations of ICBMs. The Navy had created a fleet of nuclear-powered attack and ballistic missile submarines and aircraft carriers. The Army bought three generations of its own nuclear-capable missile systems. Many of these systems duplicated capabilities of other services. But most importantly, the Services, in their rush to buy new technology, hadn’t adequately budgeted for the cost of operating, training, maintaining, and sustaining what they had bought.
In response, Secretary McNamara imposed the discipline of a Chief Financial Officer. He put in place a formal system of Planning (capability gaps, risks, scenarios, threats assumptions), Programming (5-year plans, affordability, quantities, phasing, unit fielding plans) and Budgeting that has lasted 60+ years. An entire defense university was created to train tens of thousands of contracting officers how to follow the detailed rules. Large contractors (the Primes) learned to work with this paperwork-heavy Defense acquisition system and lived with the very long time it took the DoD to buy.
The Problem
This unwieldy and lethargic acquisition system was adequate for over half a century when our adversary was the Soviet Union who had an equally complex acquisition system, or ISIS and Al Qaida who had none.
However, in the last decade it became painfully obvious that our acquisition system was broken and no longer worked for the world we lived in. Our existing defense industrial base suffers from schedule overruns and huge backlogs; cost increases have become the norm. We’ve been outpaced by adversaries. China, for example, implemented a much more agile system that delivered weapons in a fraction of the time it took us.
We needed a defense industrial base we could count on to scale in a crisis rather than one that will wait for money before taking action.
The war in Ukraine showed that even a small country could produce millions of drones a year while continually iterating on their design to match changes on the battlefield. (Something we couldn’t do.) Meanwhile, commercial technology from startups and scaleups (fueled by an immense pool of private capital) has created off-the-shelf products, many unmatched by our federal research development centers or primes, that can be delivered at a fraction of the cost/time. But the DoW acquisition system was impenetrable to startups.
Our Acquisition system was paralyzed by our own impossible risk thresholds, its focus on process not outcomes, and became risk averse and immoveable.
We needed an acquisition system that could deliver needed things faster.
Reminder: What Did Our Acquisition System Look Like Until Last Week?
The Army, Navy, Air Force, Marines and Space Force train soldiers, sailors and airmen, and specify and buy the weapons for their Service. (It’s the Combatant Commands, e.g. INDOPACOM, CENTCOM, etc., who fight the wars.)
One of the confusing things about Acquisition in the DoW is that it is more than just the buyers of equipment. In the DoW Acquisition with capital “A”, includes the entire end-to-end process – from concept, requirements, prototyping, testing, buying it, to using it and maintaining it.
In each of the Services, the current Acquisition system started with a group that forecast what the Service would need in the future and wrote requirements for future weapons/services/software. This process could take a year or more. Next, Service laboratories developed the technology, tested prototypes and concepts. This could take 3 to 6 years. Next, a vendor was selected and began to prototype and refine the systems. This added another 3 to 4 years. Finally, the system was ready to be built and delivered. It could take 1 to 2 years to deliver weapons in low rate production, or 5 to 10 years for something complex (e.g. aircraft, ships, spacecraft). In the system we’re replacing the time from when a need was turned into a requirement to delivery of a weapon would take 8 to 16 years. As you can imagine, given the rate of change of current technology and new warfighting concepts our own Acquisition process was an obstacle to building a modern War Department.
As an example, the Army’s current Acquisition system has 32,000 civilians and military (program managers, contracting officers, etc.) If you include the long tail of sustainment that’s another 165,000+ people. The Acquisition system in the Army (representative of the other services) looks like this:
What Was Wrong With this Process?
Why Is The Warfighting Acquisition System A Big Deal?
While previous administrations tried to go around the process, this new system confronts it head on. It is a revolutionary transformation in the Department of War. It was clearly designed by people who have worked in industry and understand commercial Lean Processes. This transformation will solve the DoW critical Acquisition problems by:
The New Warfighting Acquisition Organization – The Portfolio Acquisition Executive
To cut through the individual acquisition silos, the services are creating Portfolio Acquisition Executives (PAEs).
Each Portfolio Acquisition Executive (PAE) is responsible for the entire end-to-process of the different Acquisition functions: Capability Gaps/Requirements, System Centers, Programming, Acquisition, Testing, Contracting and Sustainment. PAEs are empowered to take calculated risks in pursuit of rapidly delivering innovative solutions.
PAE Offices Are Matrix Organizations
Portfolio Acquisition Executives (PAEs) are organized as a matrix organization – using people from existing organizations – requirements, PEOs, sustainment, contracting etc. The PAEs themselves will have a small staff for coordination.
Portfolios Around Common Problems
In the past, Acquisition was organized by weapon systems and managed by Program Executive Offices. Portfolios will organize instead around common Warfighting Concepts, technologies, or operational integration needs.
Multiple Portfolios In Each Service
Each of the services are consolidating and reorganizing the functions of what were their Program Executive Offices into Portfolios. Program Executive Offices/Officers (PEOs) will become Capability Program Executives (CPEs), and act as a Portfolios’ acquisition arm.
(The examples below are from the Army. Other Services will have equivalent organizational designs for their Portfolios.)
The acquisition chain of authority runs directly from Capability Program Manager to PAE to the Service Acquisition Executive (SAE), with no intermediate offices or approval layers. (The Service Acquisition Executive for the Army is the Assistant Secretary for Acquisition, Logistics & Technology. For the Navy/Marines, the Assistant Secretary for Research, Development & Acquisition. For the Air Force/Space Force the Assistant Secretary for Acquisition, Technology & Logistics.)
The Army Has 6 Portfolio Acquisition Executives
For example, the Army will likely reorganize its 12 existing PEO offices to become part of 6 portfolios aligned with Army Warfighting Concepts and functions. Each of the 6 portfolios headed by a PAEs will be commanded by a Major General.
The likely 6 Army Portfolios are: 1) Maneuver, 2) Maneuver Air, 3) Fires, 4) C2/CC2, 5) Agile Sustainment and Ammo, and 6) Layered Protection and CBRN. One additional portfolio, called the PIT, will likely include the Army’s Innovation at the Edge activities.
Army PAE Maneuver will likely combine elements of PEO Soldier, PEO Ground Combat Systems, Future Capabilities Division and Maneuver Divisions, Test and Evaluation Integrator, Strategic Contracting Office, and others. This portfolio will likely have the Abrams tank, XM30 Mechanized Infantry Combat Vehicle (replacing the M2 Bradley), the ISV (Infantry Squad Vehicle), Soldier Borne Mission Command program (SBMC), Next Generation Squad Weapon (NGSW), Soldier Borne Sensor (SBS) program, and Organization Clothing and Individual Equipment (OCIE).
Authority to Make Trade-offs
PAEs now have the authority to make trade-offs between cost, schedule and performance and apply flexible funding between weapons systems to rapidly deliver capabilities to the warfighter. This means focusing on fielding “good enough” technology instead of waiting for a product that meets every single requirement.
Army PAE Maneuver Air will likely combine elements of Program Executive Office Aviation, Aviation and Missile Command, Futures Command Future Vertical Lift team DEVCOM Aviation & Missile, and others. It will likely include the Long-Range Assault Aircraft (FLRAA) the Bell V-280 Valor (to replace the UH-60 Black Hawk), Uncrewed Aircraft Systems (UAS), Rotary and Fixed Wing, and Autonomy.
Program Executive Officers (PEOs) are Now Capability Program Executives (CPEs)
Inside each portfolio is a Capability Program Executive (CPE), typically a Brigadier General or a civilian SES. Capability Program Executives have similar roles and responsibilities as today’s PEOs. They are the Acquisition leader responsible for cradle-to-grave management of their programs within their portfolio.
Streamlined Layers of Bureaucracy
97 Army acquisition programs may be reassigned to align with the Army PAE reorganization. 46 organizations that were writing requirements likely will be consolidated into 9 Future Capability Directorates.
Army PAE Fires will likely combine elements from Program Executive Office Missiles and Space, Enterprise Information Systems, the Rapid Capabilities and Critical Technologies Office, Fires System Center, and others. It will likely include the Integrated Battle Command System (IBCS), Patriot/PAC-3, Precision Strike Missile (PrSM), Long-Range Hypersonic Weapon – Dark Eagle (LRHW), Common Autonomous Multi-Domain Launcher (CAML), Guam Defense and Golden Dome.
DoW Will Buy Commercial First
One of the biggest changes is the mandate for PAEs to buy Commercial Off the Shelf (COTS) products, modify them if necessary and only buy bespoke products as a last resort. This change by itself is going to send shockwaves through the existing Prime contractors.
It’s telling everyone that the playing field is now open to everyone. Forget who has more lobbyists on K-Street. Speed, mission impact, and innovation is what will be rewarded. What this means for startups is that if you can execute and deliver (not just PowerPoints) you can become a supplier to the DoW.
Incentive Compensation to PAEs and Program Managers
PAEs will be judged on whether they deliver systems to the warfighter on time and on schedule. PAEs and Program Managers will have “incentive compensation” tied to “capability delivery time, competition, and mission outcomes. (How they’ll pay that kind of compensation for a member of the military remains to be seen.)
Incentives and Scorecards for Contractors
They’ll be managing their contractors with “time-indexed incentives” to make sure contractors deliver on time and on budget, using “scorecards” to keep tabs on how each portfolio is doing.
Army PAE C2/CC2 (Command and Control/Counter Command and Control) will likely combine elements of PEO Command, Control, Communications and Network.. And include NGC2, TITAN, TENCAP, Next Generation Constructive, STE
Non-Traditional Entry Points
Companies selling to the DoW previously had to comply with the impenetrable DFAR and FAR – the Defense and Federal Acquisition Regulations – with over 5,000 pages of complex rules. It was designed for buying Aircraft Carriers, not startup technology.
Now the DoW is telling PAEs to toss those and use Non-FAR regulations like OTAs (Other Transaction Authorities). OTAs are not subject to the extensive, rigid rules and regulations of the DFAR. They allow for greater flexibility, speed, and allow the DoW to work with a broader range of innovative commercial companies. For startups this means massively reduced documentation, shorter timelines, and fewer barriers to working with the DoW.
PAEs Will Use Lean Methodology
Rather than fixed requirements and using waterfall development processes, the services are now insisting that vendors use Lean Methodology to set incremental and iterative delivery targets. That means they can field “good enough technology” that can be incrementally updated in the field and improved on a more frequent cadence.
The only requirement for each increment is that they need to target 1) an initial fielding date,
2) set a maximum cost of each unit and 3) meet the minimum standards for mission effectiveness. Other than that, PAEs have the authority that other attributes of the weapons/software can remain tradable throughout development to allow incremental enhancements and rapid delivery of subsequent increments. This includes the ability to waive technical standards and environmental and other compliance requirements, unless they are mandated by statute or safety.
One other interesting Lean mandate is that each PAE will set up lean technical advisory processes to inform accelerated decision-making, ensuring technical rigor without sacrificing speed.
Weapons Will Be Able to Talk to Each Other – By Design
The new PAEs are also tasked with insisting that all weapons across their programs use Modular Open System Architectures, including by asserting government purpose rights over critical software interfaces — a move that allows the Pentagon to retain the data rights needed to avoid “vendor lock” (weapon systems that can only be modified and/or repaired by the company that designed it).
Army PAE Agile Sustainment will likely combine elements of PEO Combat Support and Combat Service Support, PEO Solider and PEO Joint Program Office Armaments and Ammunition. It will likely include next generation Common Tactical Truck (CTT,) Family of Medium Tactical Vehicles (FMTV), 155mm, 6.8mm ammunition.
Two Vendors Through Initial Production
The DoW has painfully learned that having only one vendor selected leads to cost overruns and late projects. A new idea is that each critical acquisition program will have at least two qualified sources through initial production. While this will cost more upfront, it gives government leverage when it is strongest and enables them to re-compete modular components and find alternative suppliers if needed.
Design For Rapid Scale In a Crisis
PAEs have been told to establish acquisition strategies that decouple design from production to allow additional third-party suppliers to surge and rapidly scale manufacturing capacity in a crisis. They are to put in place guidelines for wartime consumption rates through manufacturing and supply chain partnerships and alternative sources.
Army PAE Layered Protection and CBRN (Chemical, Biological, Radiological, and Nuclear) will likely combine elements of PEO JPEO-CBRND. It will likely include Joint Chemical Agent Detector, UIPE, Decontamination Family of Systems, Biometrics
PAE Officers Now Have More Time To Learn On the Job
A complaint from past acquisition program managers is that they would only be there for two or three years, and then off to their next assignment. Two years was not enough time to see a program through. Now PAEs will have 4-year tours, extendible for another 2 years.
PAEs Top to Bottom
Every military service has 60 days to tell the Secretary of War a list of portfolios it is proposing to be initially stood up. A full implementation plan is due in 90 days. All major acquisition activities across all Services are going to be transitioned to PAE portfolios within two years.
Army PIT is the Army’s innovation initiatives at the edge. It’s the front door for startups wanting to partner with the Army.
- The PIT includes the Joint Innovation Outpost, the Global Tactical Edge Acquisition Directorate (G-TEAD) Marketplace, the FUZE program, and Disruptive Technologies.
- The G-TEAD Marketplace merges Prize Challenge events (e.g., Army xTech Program) and DEP submissions through open call announcements.
- FUZE brings together the Army SBIR/STTR seed funding, MANTECH (Army Manufacturing Technology program), TMI (Tech Maturation Initiative) and XTech the Army’s scouting program.
Reeducation Camp – Warfighting Acquisition University
To retrain/reeducate contracting and acquisition officers, the “Defense Acquisition University” will become the “Warfighting Acquisition University.” They have been ordered to stop compliance-focused training operations and in six months transform into a competency-based education institution.
The university will pivot to offer experiential team-based programs that work on real DoW challenges (does that ever sound like a description of Hacking for Defense.) And they’re going to have their students get out of the building and take part in industry-government exchanges. In the next six months they’re going to prioritize education and rotation programs to get their students exposure to commercial industry practices, manufacturing and operational expertise, and real-world problem-solving. All to develop Acquisition executives critical thinking and agile and rapid decision-making skills. (Note to DAU: we’ve been building these programs for a decade at the Stanford Gordian Knot Center for National Security Innovation. Our national security classes are in 60+ universities and we’re happy to help.)
The Joint Staff – Coordinating the Needs of All the Services
While each of the Services generated their own weapons requirements, plans and budgets, they all had to be approved by the Joint Staff (which reports to the Secretary of War) through a process called the JCIDS (Joint Capabilities Integration & Development System). In theory this was to coordinate each of the Service’s needs so they weren’t duplicating each other, to ensure that they were interoperable, and to give the Combatant Command a voice; and tie all the requirements to joint concepts – all of this needing to be done before Service weapons programs got funded and built.
The problem was that JCIDS moved at the speed of paperwork, not war, so the Secretary of War eliminated it earlier this year. (They kept part of it called the Joint Requirements Oversight Council but reoriented it from validating documents to identifying joint operational problems, which will drive the priorities for the entire department of War.)
In JCIDS’ place the Secretary of War created three new organizations:
It’s interesting to note that none of these changes at the Joint Staff have seemed to (at least publicly) filter down to the charter of the Services Portfolio Acquisition Executives (PAEs). The achilles heel of the Services Acquisition process appears that they are still planning to put the Requirements and Capability gap analysis up front. Here’s why that’s a problem and how to fix it.
Foreign military sales
One other tangential decision in this redesign was not in acquisition but in sales. The DoW wants a greater emphasis on selling our weapons to our Allies. They’ve moved two agencies responsible for those functions – the Defense Technology Security Administration DTSA and the Defense Security Cooperation Agency (DSCA) – from OSD Policy to OSD Acquisition and Sustainment.
This move is about selling more of our equipment, but makes no mention of buying any equipment from our allies.
Inferred But Not Mentioned
Pretty interesting that in this reorg no one has noticed that Elbridge Colby – Under Secretary for Policy – had three organizations taken away from him.
All three organizations were handed to Michael Duffey the Under Secretary for Acquisition & Sustainment. Regardless of the public statements the optics are not a vote of confidence.
Bigger and Better?
It appears that the Office of Strategic Capital may have been swallowed up by the Economic Defense Unit run by George Kolitdes. From all appearances the Economic Defense Unit is tasked to decouple our economy from China, using private and public capital. That means considering how to on-shore the critical components like minerals, chips, batteries, motors, PNT, etc.) The Acquisition announcement was how to buy things. This Economic Defense Unit is how do we ensure the things we buy are made with parts we know we can have an assured supply of?
Summary
- Startups and the DoW are now speaking the same language – Lean, feedback from the field, pivots, iterative and incremental product design, speed to delivery.
- The DoW mandate to first buy commercial-off-the-shelf products is a once-in-a-lifetime opportunity for every startup and scaleup.
- But you have to deliver. Don’t hand wave with PowerPoints.
- DoW will be ruthless in shutting down and freezing out non-performers.
- The use of Non-Federal Acquisition Regulations will eliminate huge amounts of paperwork.
- It eliminates one of the reasons to subcontract with a prime or other company
- DoW needs to be ruthless in reforming the compliance culture
- Who to talk to in each service and how will they do business will be unclear for at least the next six months
- Reorganizations will create uncertainty of who is the front door for startups, how the new rules apply, and who can commit to contracts.
- The Army appears to be further along than the other services in putting a PAE organization in place.
- In theory this is a knife to the heart of the Primes’ business model.
- They will flood Congress and the Executive Branch with infinite capital to change these rules.
- It’s a race between private capital and public company lobbying money
- Let’s hope these changes stick
Thanks to Pete Newell of BMNT for the feedback and insight.
2025-10-30 21:00:42
I’ve always thought of myself as a practitioner. In the startups I was part of, the only “strategy” were my marketing tactics on how to make the VP of Sales the richest person in the company. After I retired, I created Customer Development and co-created the Lean Startup as a simple methodology which codified founders best practices – in a language and process that was easy to understand and implement. All from a practitioner’s point of view.
So you can imagine my surprise when I received the annual “Strategy Leadership Impact” Award from the Strategic Management Society (SMS). The SMS is the strategy field’s main professional society with over 3,100 members. They publish three academic journals; the Strategic Management Journal, Strategic Entrepreneurship Journal, and Global Strategy Journal.
The award said, [Steve Blank] as the Father of Modern Entrepreneurship, changed how startups are built, how entrepreneurship is taught, how science is commercialized, and how companies and government innovate.
Here’s my acceptance speech.
Thank you for the Strategy Leadership Impact Award. As a practitioner standing in front of a room full of strategists, I’m humbled and honored.
George Bernard Shaw reminded us that Americans and British are “one people separated by a common language.” I’ve often felt the same way about the gap between practitioners and strategists.
The best analogy I can offer, is the time after a long plane flight to Sydney, I jumped into a taxi and as the taxi driver started talking I started panicking – wondering what language he was speaking, and how I was going to be able to communicate to him.
It took me almost till we got to the hotel to realize he was speaking in English.
That’s sometimes how it feels between those who do strategy and those who study it.
So today, I’d like to share with you how this practitioner accidently became a strategist and how that journey led to what we now call the Lean Startup.
It’s a story that begins, perhaps surprisingly with what I call the Secret History of Silicon Valley.
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Silicon Valley’s roots lie in solving urgent, high-uncertainty national-security problems during World War II and the Cold War with the Soviet Union.
During WW II, the United States mastered scale and exploitation—mass-producing ships, aircraft, and tanks through centralized coordination. Ford, GM, Dupont, GE and others became the “arsenals of democracy.” In less than 4 years the U.S. built 300,000 aircraft, 124,000 of all types of ships, 86,000 tanks.
But simultaneously we created something radically different, something no other nation did – we created the Office of Science and Research and Development – OSR&D. This was a decentralized network of university labs that worked on military problems that involved electronics, chemistry and physics. These labs solved problems where outcomes were unknown and time horizons uncertain—exactly the conditions that later came to define innovation under uncertainty.
These labs delivered radar, rockets, proximity fuses, penicillin, sulfa drugs, and for the first two years ran the U.S. nuclear weapons program.
In hindsight, way before we had the language, the U.S. was practicing dynamic capabilities: the capacity to sense, seize, and transform under extreme uncertainty. It was also an early case of organizational ambidexterity—balancing mass production with rapid exploration.
One branch of this Office of Science and Research and Development – focused on electronic warfare—became the true genesis of the Valley’s innovation model.
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In 1943, U.S. bombers over Europe faced catastrophic losses—4–5% of planes were shot down every mission. The German’s had built a deadly effective radar-based air defense system. The U.S. responded by creating the Harvard Radio Research Lab, led by Stanford’s Fred Terman. The lab had nothing to do with Harvard, Radio or Research.
Its goal was to rapidly develop countermeasures: jammers, receivers, and radar intelligence.
In the span of three years, Terman’s lab created an entire electronic ecosystem to defeat the German air defense systems. By war’s end U.S. factories were running 24/7 mass producing tens of thousands of the most complicated electronics and microwave systems that went on every bomber over Europe and Japan.
These teams were interdisciplinary, field-connected, and operating in continuous learning cycles:
But what does this have to do with Silicon Valley?
When the war ended Terman came back to Stanford and became Dean of Engineering and institutionalized this model. He embedded government research into the university, recruited his wartime engineers as faculty, and redefined Stanford as an outward-facing institution.
While most universities pursued knowledge exploitation – publishing, teaching, and extending established disciplines, Terman at Stanford did something that few universities in the 1950’s, 60’s or 70’s were doing – he pursued knowledge exploration and recombination. Turning Stanford into an outward facing university – with a focus on commercializing their inventions.
Terman’s policies as now Provost effectively turned Stanford into an early platform for innovation ecosystems—decades before the term existed.
The technology spinouts from Stanford and small business springing up nearby were by their very nature managing uncertainty, complexity, and unpredictability. These early Valley entrepreneurs weren’t “lone inventors”; they were learning organizations, long before that term existed. They were continuously testing, learning, and iterating based on real operational data and customer feedback rather than long static plans.
However, at the time there was no risk capital to guide them. They were undercapitalized small businesses chasing orders and trying to stay in business.
It wasn’t until the mid 1970’s when the “prudent man” rule was revised for pension funds, and Venture Capital began to be treated as an institutional asset class, that venture capital at scale became a business in Silicon Valley. This is the moment when finance replaced learning as the dominant logic.
For the next 25 years, Venture investors – most of them with MBAs or with backgrounds in finance, treated startups like smaller versions of large companies. None of them had worked on cold war projects nor were they familiar with the agile and customer centric models defense innovation organizations had built. No VC was thinking about whether lessons from corporate strategic management thinkers of the time could be used in startups. Instead, VCs imposed a waterfall mindset —business plans and execution of the strategy in the plan — the opposite of how the Valley first innovated. The earlier language of experimentation, iteration, and customer learning disappeared.
And now we come full circle – to the Lean Startup.
At the turn of the century after 21 years as a practitioner, and with a background working on cold war weapons systems, I retired from startups and had time to think.
The more I looked at the business I had been in, and the boards I was now sitting on, I realized a few things.
The sum of these tools – Customer Development, Agile Engineering and the Business Model Canvas – is the Lean Methodology.
What I had done is turn a craft into a discipline of strategic learning—a continuous loop of hypothesis testing, experimentation via minimum viable products, and adaptation via pivots.
Lean is a codified system for strategy formation under uncertainty.
Over the last two decades Lean has turned into the de facto standard for starting new ventures. The classes I created at Stanford were adopted by the National Science Foundation and the National Institutes of Health, to commercialize science in the U.S.
And while contemporary entrepreneurs didn’t know it they were adopting the continuous learning cycles that had fueled wartime innovation.
What comes next is going to be even more interesting.
We’re going to remember – for better or worse – 2025 as another inflection point.
AI in everything, synthetic biology, and capital at previously unimaginable scale, are collapsing the distance between exploration and exploitation.
The boundary between discovery, invention, and strategy is dissolving.
Given how fast things are changing I’m looking forward to seeing strategy itself become a dynamic capability—not a plan, but a process of learning faster than the environment changes.
I can’t wait to see what you all create next.
In closing, my work at Stanford was made possible by the unflinching support from Tom Byers, Kathy Eisenhardt and Riitta Katila in the Stanford Technology Ventures Program who let a practitioner into the building.
Thank you.
2025-10-15 21:00:11
The October 2025 PEO Directory – Update 2.
The Department of War (DoW) is one of the world’s largest organizations. If you’re a startup trying to figure out who to call on and how to navigate the system, it can be – to put it politely – challenging.
Those inside the DoW have little perspective of how hard it is to understand what to an outsider looks like in an impenetrable, incredibly complex system.
Insiders know who to call, and prime contractors have teams of people following broad area announcements and contracts, but if you’re startup, you have none of those relationships. (And with the advent of Social Media even our adversaries have better knowledge.)
If we’re serious about building a next generation defense ecosystem (not just buying the next shiny object), then this is the directory the Department of War should be publishing.
Until then, here’s the second update to the Department of War PEO Directory.
500 new names/organizations in this DoW phonebook and startup Go-to-Market Strategy playbook.
(See Appendix H for a summary of the changes.)
Downloads of the Directory can be found here.
Sign up for timely updates here.