DoD releases NDIS document to coordinate and prioritize actions for modernized defense industrial ecosystem
The U.S. Department of Defense (DoD) released its inaugural National Defense Industrial Strategy (NDIS) that offers a strategic vision to coordinate and prioritize actions to build a modernized defense industrial ecosystem over the next three to five years. The proposed pathway to modernize the defense industrial ecosystem recognizes that this is not and cannot be a DoD-only solution. The NDIS document will require effort, cooperation, and coordination between the U.S. government, private industry, and international allies and partners.
“Developing and empowering this modern defense industrial ecosystem is key to integrated deterrence and building enduring advantages,” Kathleen H. Hicks, deputy Secretary of Defense, wrote in the document. “By aligning policies, investments, and activities inside and outside the Department in a manner that is tailored to specific competitors, our industrial ecosystem can strengthen deterrence to maximum effect. Should deterrence fail, the NDIS postures our industrial ecosystem to provide our warfighters the necessary capabilities – at speed and scale – to defeat any nation that attempts to harm the security of the United States, our allies, and our partners.”
The NDIS recognizes that America’s economic security and national security are mutually reinforcing and, ultimately the nation’s military strength cannot be untethered from our overall industrial strength, Dr. William A. LaPlante, Under Secretary of Defense for Acquisition and Sustainment, said in a DoD media statement. “We must act now to build on recent progress and ensure we have the capacity to produce at speed and scale.”
Earlier in September, the DoD released an unclassified summary of its classified 2023 Cyber Strategy. It focuses exclusively on matters within the cyber domain and outlines that to address current and future cyber threats, apart from the four complementary lines of effort that the agency will pursue. The defense agency had transmitted the classified 2023 DoD Cyber Strategy to Congress earlier in May.
While the 2022 National Defense Strategy (NDS) identifies risks to the industrial base, it also guides the Department to solutions. Recognizing that the defense industrial base (DIB) must provide the required capabilities at the speed and scale necessary for the U.S. military to engage and prevail in a near-peer conflict, the NDIS strategy calls out challenges, solutions, and risks of failure concisely. The strategy offers a strategic vision and path along four strategic priorities: resilient supply chains, workforce readiness, flexible acquisition, and economic deterrence.
The NDIS document outlines four priorities that will catalyze the changes needed to build a modernized defense industrial ecosystem. Each of the four priorities has associated long-term actions that promote flexibility and dynamic capabilities as we build this ecosystem. These include resilient supply chains, workforce readiness, flexible acquisition, and economic deterrence.
The strategic priorities of the NDIS document include resilient supply chains that can securely produce the products, services, and technologies needed now and in the future at speed, scale, and cost. Workforce readiness will provide for a sufficiently skilled, and staffed workforce that is diverse and representative of America. Flexible acquisition will lead to the development of strategies that strive for dynamic capabilities while balancing efficiency, maintainability, customization and standardization in defense platforms and support systems. Flexible acquisition strategies would result in reduced development times, reduced costs, and increased scalability.
Lastly, the NDIS document covered economic deterrence to promote fair and effective market mechanisms that support a resilient defense industrial ecosystem among the U.S. and close international allies and partners and economic security and integrated deterrence. As a result of effective economic deterrence, fear of materially reduced access to U.S. markets, technologies, and innovations will sow doubt in the minds of potential aggressors.
When it comes to a resilient supply chain, the NDIS document detailed that the DoD will incentivize the industry to improve resilience by investing in extra capacity; managing inventory and stockpile planning to decrease near-term risk; continuing and expanding support for domestic production; driving investment in the organic industrial base and production accelerators; and diversify the supplier base and invest in new production methods. It will also leverage data analytics to improve sub-tier visibility to identify and minimize strategic supply chain risks and to manage disruptions proactively; engage allies and partners to expand global defense production and increase supply chain resilience; and improve the Foreign Military Sales process.
Additionally, the risks of not achieving resilient supply chains include supply and material shortfalls; diminished surge capacity; supply chain vulnerability; and falling behind pacing challenges identified in the 2022 NDS.
On workforce readiness, to address this priority, DoD will work to prepare the workforce for future technological innovation; continue targeting critical skill sets in science, technology, engineering, and math; increase access to apprenticeship and internship programs; and reduce stigmatization of industrial careers while expanding recruitment of non-traditional communities. Additionally, insufficient workforce readiness could lead to the inability to onshore critical manufacturing; the inability to compete globally; reduced productivity throughout the full supply chain; and limited innovation.
Flexible acquisition will lead to the development of strategies that strive for dynamic capabilities while balancing efficiency, maintainability, customization, and standardization in defense platforms and support systems. Flexible acquisition strategies would result in reduced development times, reduced costs, and increased scalability.
To address this priority, DoD will work to broaden platform standards and interoperability; strengthen requirements to curb ‘scope creep;’ prioritize off-the-shelf acquisition where applicable and reasonable; increase DoD access to intellectual property and data rights to enhance acquisition and sustainment; consider greater use and policy reform of contracting strategies; continue to support acquisition reform; and update industrial mobilization authorities and planning to ensure preparedness.
Secondly, the NDIS document identified that flexible acquisition planning will allow the DoD to work with a broader set of industry partners and balance the tension between the need for customization and adopting, where appropriate, industry standards.
Failure to balance these risks strategically can hinder the delivery of critical capabilities. Other risks of failure include limited scale; high costs and lengthy development times; technology obsolescence; diminished industrial base resilience; sustainment and logistics challenges; reduced operational effectiveness; and increased technological risk.
The NDIS document said that economic deterrence will promote fair and effective market mechanisms that support a resilient defense industrial ecosystem among the U.S. and close international allies and partners and economic security and integrated deterrence. As a result of effective economic deterrence, fear of materially reduced access to U.S. markets, technologies, and innovations will sow doubt in the minds of potential aggressors.
To address this priority, DoD will work to strengthen economic security agreements; enable international interoperability standards through active participation in standards-setting bodies; fortify alliances to share science and technology; strengthen enforcement against adversarial ownership and against cyberattacks; and strengthen prohibited sources policies to protect the DIB from adversarial intrusion.
Failing to deter adversarial entities could generate critical economic, supply chain, and infrastructure vulnerabilities; increased costs and reduced defense budgets; a weakened industrial ecosystem; intellectual property theft and adversarial capital IP control; degraded technological edge, innovation, and quality; and eventually lead to the loss of trust and reputation with international partners.
The DoD recognizes that to realize these industrial priorities, it needs to address systemic challenges, including underutilization of multi-use technologies, an inadequate workforce, inadequate domestic production, non-competitive practices, long lead times, and sub-par readiness. It also includes the fragility of sub-tier suppliers, lack of market share, over-customization, and obsolescence, instability of procurement, funding uncertainty and constraints, and limited visibility into international ally and partner requirements.
In its conclusion, the DoD said that the NDIS document addresses the imperative to mitigate and remedy critical vulnerabilities with intentional action, guided by a strategic vision and framework for how to revitalize, modernize, and expand the DIB. The actions proposed by this strategy lay out the generational changes needed to catalyze a modernized defense industrial ecosystem.
“This will require real and meaningful cooperation and participation of new domestic and international entrants into the defense industrial fold,” according to the document. “We must transform our DIB into a robust, resilient, fully capable 21st-century defense industrial ecosystem. As we execute the provisions of this strategy, we will remain mindful of—and overcome—the real impediments to our success. Within the Department, we will establish the conditions for success including by promoting appropriate, consistent, and predictable funding where possible.”
Additionally, the NDIS document is a “call to both the public and private sectors for focused, dedicated efforts to build and secure the industrial capability and capacity necessary to ensure our military has the materiel available to deter our potential adversaries and if necessary, defeat them in battle. This call to action may seem a great cost, but the consequences of inaction or failure are far greater.”
In November, the DoD released its 2023 DOD Data, Analytics, and AI Adoption Strategy to expand advanced capabilities throughout the entire enterprise. The primary objective of the document is to accelerate the adoption of data, analytics, and AI (artificial intelligence) across all DOD Components in a consistent and reproducible manner.
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