“The early bird gets the worm. The early worm… gets eaten” – Norm Augustine
With support from the highest levels in the service, the US Air Force recently has established AFWerX as part of a deliberate effort to foster and cultivate defense-oriented innovation. Partnered with other innovation hubs in the Department of Defense, AFWerX is geared toward building partnerships with non-traditional defense contractors and startups, using a variety of tools to develop and sustain an ecosystem of innovators and collaborators. The recent grand opening of the AFWerX storefront in Las Vegas, Nevada presents an opportunity to assess the impact that the AFWerX philosophy of innovation will have on the Air Force acquisition system, and the likelihood of acceptance across the service. This article discusses the background, philosophy, methodology, and early effects of AFWerX and other partners in the AF-sponsored innovation community.
Estimated Reading Time: 11 Mins
By Eric Buschelman
As the US Air Force tries to accelerate its acquisition system to operate at the speed of relevancy, momentum is building inside the service for embracing a radically different approach toward deliberately fostering innovation within defense acquisition. Rather than attempting to scrap and zero-baseline the entire system, the Air Force is trying to affect cultural change from the ground up, both inside and outside the service. The latest hub for this innovative shift is AFWerX. Within the past two years, the Department of Defense has taken significant steps to deliberately foster innovation within the Defense Acquisition community. The newest instantiation of deliberate innovation, AFWerX, follows in the tradition of three other upstart acquisition organizations: DIUx, SOFWERX, and DefenseWERX.
DEFENSE INNOVATION UNIT – EXPERIMENTAL
In August 2015, then-Secretary of Defense Ashton Carter announced the Defense Innovation Unit-Experimental (DIUx) initiative, with the first office located in Silicon Valley, California. Situated in a hotbed of innovation, venture capital investment, and a risk-taking “startup” culture, DIUx pursues closer ties with commercial entities outside the traditional defense industry. DIUx places special emphasis on identifying promising technologies, ideas, and innovations by leveraging research and development in the commercial sector. Although barely into its third year of existence, DIUx has awarded over $100 million in contracts for 45 pilot projects, in areas of artificial intelligence, autonomy, data analysis, and space. Operating with both new authorities and new industry partners, DIUx recently ran afoul of Pentagon auditors, when a nearly $1B cloud-computing contract awarded by DIUx was reduced in scope by 85%. The recent departure of Dr Raj Shah as the head of the organization notwithstanding, the DIUx model is paving the way for the creation of other like-minded organizations oriented toward accessing non-traditional (for the government) sources of innovation.
Following quickly on the heels of DIUx, US Special Operations Command partnered with the Fort Walton Beach, Florida-located Doolittle Institute, a 501(c)(3) non-profit with ties to the Air Force Research Laboratory, to found SOFWERX in Tampa, Florida. Following the DIUx model, SOFWERX focuses on bringing the “right minds together to solve challenging problems,” and does this by growing an ecosystem of innovators, with itself as the facilitator. Operating under a Partnership Intermediary Agreement with USSOCOM, SOFWERX benefits from the “tip of the spear” cultural mindset of USSOCOM, as well as the personal involvement of leaders inside the Special Operations-acquisition community, including Col Melissa Johnson of PEO-FW, and former SOCOM Acquisition Executive Col (ret) James “Hondo” Guerts, now the Assistant Secretary of the Navy for Research, Development and Acquisition.
Also in 2015, the Air Force commissioned a study by the National Academy of Sciences to assess and evaluate the state of experimentation and innovation in the Air Force product life cycle. The primary recommendation of the final report, published in 2016, was for the Air Force to deliberately create organizational space for innovation, and to establish “Innovation Catalysts” to drive innovation and experimentation in critical research areas. It is exceedingly likely that insights such as those within the report drove senior Air Force leaders to move ahead in 2017 with two organizational initiatives designed to boost access to innovation. First, the Doolittle Institute re-branded itself as DefenseWERX in August 2017. Previously focused on collaboration and workforce development, DefenseWERX shifted its orientation technology transfer, innovation, and out-reach to non-traditional and commercial entities. It also continues to run the day-to-day administrative actions of the Tampa-based affiliate SOFWERX, where the emphasis is on an “open door” environment which can create a new model for defense innovation. Second, it was now possible for the Air Force to migrate the SOFWERX model of an “innovation storefront” to its own backyard in the form of AFWerX.
Secretary of the Air Force Dr. Heather Wilson announced the creation of AFWerX during a visit to Nellis AFB, NV on 21 July 2017, and the official storefront ribbon cutting took place on 11 January 2018. A small team, led by a four-person Steering Group, was tasked with taking the first steps to build the “ecosystem” of innovators and bring them into contact with the Air Force. In particular, this involves leveraging the previously-untapped potential of ideas outside the traditional DoD orbit by reaching out to academic scientists, underground hackers, and even garage tinkerers.
Although AFWerX was established after SECDEF Carter left office, its founding is entirely consistent with the vision he announced for DIUx in 2015. At that time, Carter expressed intent to bring in new ideas, open doors to new partners, and push existing bureaucracy to do better rather than keep doing the same things that have always been done. At present, AFWerX has five main features or “tools” that it uses to execute its mission. First is the “Innovation Hub,” or “open storefront.” These are the physical, brick-and-mortar locations where AFWerX hosts events. Currently, there are two: the home office in Washington, D.C., and the satellite location at Las Vegas, Nevada. Second, the “Fridays at AFWerX” tool is a weekly ideation session where innovators, entrepreneurs, and policymakers meet, either in person or on a conference call, to discuss problems, ideas, and solutions. Topics of discussion are pre-announced, and distributed through the AFWerX network of collaborators. Thirdly, AFWerX is also looking at sponsoring competitions in the style of the DARPA and NASA “Grand Challenges,” although appropriate topics are still in work.
The final two AFWerX tools are relatively more mature. The “Tech Accelerator” program, established in September 2017, aims to link commercially viable startups in possession of dual-purpose technology with both government and private sector sponsors, an AFWerX contracted with the well-established technology and entrepreneur company PBTS, LLC to run one such program through their Techstars Foundation. Like other commercial accelerators, Techstars helps small companies make optimal choices on the path to becoming a successful startup firm, and can also guide teams in the best practices of a lean business model, such as delivering a “minimum viable product” to a consumer base. Current research thrusts include multi-sensor fusion, counter-drone systems, Big Data, and human-systems integration. Ultimately, this AFWerX initiative is all about reducing barriers of entry for non-traditional defense industry partners, as well as leveraging the scale and effort of commercial industry innovation.
Finally, AFWerX hosts the “SPARK” program, a “grassroots innovation program” designed to increase the speed of idea transfer from creation to warfighter delivery. It is intended to be the Air Force’s “in-house” Innovation Cell throughout the force, echoing the call for “Innovation Catalyst” cells from the 2016 National Academy of Science report. The AFWerX Spark program is also tied in with innovation initiatives at the highest levels of the Air Force. Earlier this year, the AFWerX-sponsored “Spark Tank” innovation challenge announced its winning entry at the Air Force Association conference in Orlando, Florida.
As a self-declared “Innovation Hub,” AFWerX faces a different risk posture from other Air Force acquisition entities. It is neither a program office, nor a program outright. It has a limited budget of approximately $7M, and so is only equipped to act in from a “venture capitalist” mindset as it seeks to connect other innovators. Another challenge to overcome is figuring out how to innovate (or “disrupt”) within a process-centric system: the Defense Acquisition System itself. It has been frequently observed that when group acts outside the accepted standards of normal behavior, “the antibodies come out and will try to destroy” that organization, as a senior AF program manager pointed out to this author for this article. With this in mind, AFWerX, and other like-minded organizations, should expect to face continued opposition from the established bureaucracy.
However, AFWerX does share some similarities with existing acquisition entities. As the AFWerX team seeks to partner with small, non-traditional commercial sources, it can look to the Small Business Innovative Research program as a guide for behavior. AFWerX, by its very organizational nature, is well equipped to partner with research labs and academia as it pursues innovative solutions for low Technology Readiness Level applications. Additionally, the AFWerX focus on rapid delivery of capability to the warfighter lends it to be oriented on high TRL applications, where the bulk of the effort spent integrating “stuff that works with other stuff that works.” The similarities with standard, or deliberate, acquisition tend to be exhausted after this point, and the differences become more apparent.
Like many small acquisition efforts focused on rapid delivery, AFWerX has an ingrained aversion to established processes. The organizational culture of this and other organizations emphasizes “failing often”, and “finding a way to get to yes.” AFWerX seeks to deliberately blur lines of effort, reduce or eliminate lines of effort, and seek out relationships which lead to mutual benefit for both the government and the partner. This is in contrast with the typical transactional culture of a mainstream program office, where the Pentagon “takes” what the prime contractor “gives.”
AFWerX uses a non-traditional contracting and manufacturing strategy, wielding its access to Other Transactional Authority (OTA), giving it special leverage to promote innovation. OTA can be well suited for a large commercial base, and is also well suited for attracting small businesses in the IT and software industry, but it is not a one-size fits all cure-all for acquisition system malaise. As a mechanism which exists outside the Federal Acquisition Regulation (FAR), OT agreements are not subject to the FAR regulations concerning appropriated federal funds. While AFWerX has yet to fully exercise its own OTA, other government organizations (DIUx, NASA, etc.) continue to implement novel partnerships with industry. When it comes to a manufacturing / fielding capability, AFWerX chooses to leverage the resources of other, more capable partners. One of the features of the AFWerX “ecosystem of innovators” is that breakthrough, innovative ideas will be spotted by a larger, more established firm in the ecosystem, which will then help the smaller firm rapidly transition the idea to a prototype, additional development, or fielding depending on the application. AFWerX merely manages the introduction of the partners. By extension, AFWerX has little to no interest in sustainment of the ideas or products that they identify. To the extent they have a sustainment plan at all, it is for the anticipated sponsoring party to pick up the idea (or product) take responsibility for the associated “care and feeding.” It bears repeating that the AFWerX contribution to the entire system is to encourage the development of innovative ideas outside the normal channels, as well as ensuring that those ideas are not stifled by “the system.”
THE WAY AHEAD: SURVIVAL?
Despite its extremely short organizational life, having only been founded in the summer of 2017, AFWerX represents the latest, and most deliberate, attempt by Air Force senior leaders to create “safe space” with the service for experimentation, innovation, and failures. It is not clear yet whether the AFWerX experiment itself will be successful, and how that success will be defined. What is clear is that the AFWerX model is not intended to replace traditional program offices, or replace the DAS. Indeed, the need for fixing the acquisition system itself is far from a settled question. However, as a newly established organization inside the military deliberately tasked with “finding better ways to perform other tasks,” AFWerX is facing a daunting challenge in its attempt to bring back a culture of innovation and risk taking to the broader Air Force. Time, and results, will tell if it is given enough latitude to tackle risk and embrace failure, or if it will suffer the fate of other first-movers, and be caught up and devoured by the early bird.
Major Eric A. Buschelman is a career acquisition officer in the US Air Force, and currently a student at the Air Command and Staff College, Maxwell AFB, Alabama. He has previously held leadership positions in military intelligence, research and development, and weapon systems procurement. He holds both an MS and PhD in Electrical Engineering from the Air Force Institute of Technology, and the BS in Electrical Engineering from the University of Kansas. In 2017, he participated in the Air University Research Task Force for Rapid Acquisition.
The views expressed are those of the author and do not necessarily reflect the official policy or position of the Department of the Air Force or the US government.