One DoD leader says a sharper technology focus is changing how government works with industry

0:00Print servers and federal environments create risk and unnecessary complexity. Every new printer, location, or policy adds strain to infrastructure that was never built for today's demands. FedRAMP High authorized printer logic eliminates print servers with a secure cloud native zero-trust solution designed for federal IT. With advanced security, centralized control, and simplified management, agencies can modernize print without added burden. See what secure serverless printing looks like. Visit VAsian.com to learn more. Federal Drive is presented by GEHA, Government Employees Health Association, proudly providing health and dental benefits to federal employees and their families. Visit GEHA.com. And now, the Fed Bull Drive with Terry Gurt, sponsored by GEHA. Welcome to the Federal Drive on Federal News Network. It's Monday, September 14. I'm your host, Terry Gurton, and I'm glad you're here. We were on site at NDIA's Emerging Technology Conference last week,

1:01and today we'll bring you some of the key insights and interviews from that event. Coming up on this hour of the Federal Drive, if everything is critical, nothing is. One Defense Department leader says a sharper technology focus is changing how government works with industry, investors, and emerging companies. Plus, from fishery patrols to Arctic operations, the Coast Guard is building new ways to turn operational data into usable information. Those stories are much more ahead on this hour of the Federal Drive. We begin with this. The Defense Department has narrowed its list of critical technology areas and is rethinking how it identifies, funds, and scales emerging capabilities. The goal is to focus resources where technological advantage matters most, while bringing new companies and new sources of capital into the process. My next guest is Mike Dodd, the Assistant Secretary of War for Critical Technologies in the Office of the Undersecretary of War for Research and Engineering. Mr. Dodd, thank you so much for joining me today here on-site at NDIA.

2:02No, thanks for having me. I appreciate it. You've spent a lot of your career navigating the space between government and industry and investors. As you look at where we are now, what are some of the biggest changes you'd point to in how the Defense Department accesses emerging technology? No, I appreciate that. I think a couple of themes here. One, just in the identification of what our actual critical technology named critical technology areas are, we've recently gone from 14 down to six. And that's by design, right? Where the Department is really trying to have a thesis of where are we peer-to-peer, where are the adversaries, where are we near peer? Because if everything critical, nothing is. So coming down from 14 to six, and also ensuring that we can do business at the speed of business relevance and scale. So just within my office in bringing in teams, embedding teams from Incutel and the Office of Strategic Capital. So we bring institutional finance to the equation as well,

3:10recognizing often one of the most significant challenges for non-traditional is the ability to have access to capital and scale. So I think a very narrow focus on what is critical or pathways to business, the contracting mechanisms by which we can do business and having access to capital is our kind of go-fast mechanism. Let's take each one of those in turn. Let's start with the critical technology areas going from 14 to six. How did you make that decision? And how has it changed how you engage with the market? Totally. And I think it was kind of touched on, you know, when we went from 14 to six, it was really looking at our adversaries and their capabilities and their technology capabilities. And, you know, our construct is to deter major conflict by having a disparity of technological capability. So recognizing where we were peer-to-peer or near-peer and some of those domains and our quantum battlefield information dominance, our scale-directed energy and our contested logistics

4:15are three of the six that fall within my office in critical technologies. So it was determining what we needed to focus on, what actually is critical. And then kind of in parallel that recognizing that microelectronics, semiconductors, chips are foundational in everything that we have. And they don't necessarily be named as a critical technology area because they're foundational in everything that we do. So they become an enduring effort within my office as well. So really determining what's critical and putting our placing our bets and our funding profiles along those name CTs and the GOFAS mechanisms within within my office. And you mentioned I'll use air quotes here placing your bets. Yes. But that really I assume means aligning funding. And you're looking at a lot of different sources of funds and types of funds. What did you find most challenging there? I think on the front end was just changing, I think the culture shift within the department and

5:15within the Pentagon has been significant. And I don't know for a complete 180 yet, but it's getting there. And you know, a lot of large prime contractors were expecting the department to pay and fund all the R&D. And that's no longer our model, right? Where our expectation is for primes in our mid-tier companies to invest their own IRAD dollars into those capabilities that are interesting and or compelling to the department. The culture shift on actually doing business at the speed of business. And the statutorily we've had that for decades. And recognizing we can do things in several days or weeks and putting performers onto contract. Right? So the performers that were trying to attract into the Dib or did performers were trying to scale for them to get across that proverbial value of death. Right? They have to understand where the funding mechanisms are, the contractual pathways, where their prospective teaming opportunities are, and how will we actually

6:19help those companies scale? And the kind of that, you know, fourth tenant is that they have access to capital and structured finance that will actually allow them to to scale to the to the level that the department is looking for. And that brings in the office of strategic capital, which has been sort of a backwater for a long time. But now clearly is not. How are they getting in the middle of all of this to facilitate the relationships that you need? Well, I think a couple of neat ways. One certainly of which it took them time simply to just get formed and get statutory authorities and funding that they can actually deploy to these problem sets. Right? So they're at a very, you know, we're catching them in a great kind of crossroad and sincerely nobody better to establish and accelerate these and deputy secretary Feinberg with his background coming from private equity. And just fully understanding one, the need within the department and two, how do we access it and create those structured finance opportunities for our not traditional performers? So again,

7:22we've embedded a direct representative from the office of strategic capital, who looks at all my non-traditional performers and are in our large prime as well, to ensure that where we can provide structured finance to those performers, where the department is making those large bets, those performers can scale. So I think OSE and early on, they also were exceptionally focused on some of the top problem statements for the department as far as rare earth and critical mineral opportunities. So the front end of their deal flow was fairly heavy on critical minerals and rare earths and recognizing we need to resure a lot of those efforts. And then as I also mentioned, you know, I've got microelectronics and semiconductors in my book, they're going to be in R as we look at some of the deal flow and funding opportunities, absolutely critical in the reshoring or near-shoring of these semiconductors and chips needed for all of our systems. As you're talking about structured

8:24finance and deal flows, one of your other focus areas really has been to open more front doors to these non-traditional companies, folks who don't have a long relationship with the defense industrial bay. How are you doing that and how are they finding out where to knock? I love that question. So I'm smiling. One of the best ways we do those things like this, we come to these type of events where we look for and find technologists where they are and ensure that we get a chance to meet and vet, you know, technology capabilities and iterate with them in real time. Like so I think you joked on the way in here, you know, I roll pretty deep and that's by design. We've got some of our senior officials and our technologists along with us so we can meet some of these performers and iterate with them in real time and get a sense of how interesting our compelling may they be and how do we get them into into the Pentagon or meeting some of our technical teams so we can determine how interesting our compelling there really are. Now, in parallel

9:27with that, I worth mentioning we have another effort underway and within one of my offices, a soon to be released kind of front door portal and what that will do is go across the department and there's certainly a number of, you know, certainly front door websites portals. This will aggregate all those into kind of one effort and on the on the infrastructure side of that, we'll be able to kind of scrape all of those abstracts white papers, capabilities briefs, even marketing material websites and start to heat map capability to our problem sets so we can bubble those technologists up that they get a senior official or technologist review and then we can get them again in and actually vet their capability or technology and then how bankable are they as well. We'll do that all kind of in one construct. That is fascinating and finding these companies and getting them to the front door is only step one. Yes. The federal acquisition

10:29regulation overhaul is really supposed to help change how agencies think about acquisition. When you think about it from the technology transfer space, what are you really hoping that the far overhaul does for you? I think two significant things. One recognizing where we need to utilize far based acquisition we can and we should and those are a lot more of our kind of come out of the items or our commercial off the shelf type items and our huge systems, right? If you're doing you know manufacturing ships as an example, the air is pretty thin and who can do that and at scale. We primarily use non far based acquisition methods to access non traditional performers and we do that in a couple different ways. One, I have a consortia manager that manages a consortia of thousands of non traditional performers. So what the CM does for me as the government is they take on the fiscal and contractual fiduciary responsibilities and to the performer it really

11:31is like a commercial contract, right? So my contract is with the CM. They manage the fiscal fiduciary responsibilities to the performers and make that as as simple as they can and those become like eight or ten page type contracts for us to get on like a commercial as type of contract for our non traditional. So it's utilizing the far certainly where we need and then candidly avoiding it like heck where we just don't need it and I have much faster you know statutory tools in my toolbox to get performers onto contract as quickly as possible and that can be literally like same day stuff if we want to get a performer on contract. All right so we've got them to the door, we've got them through the door, we've got them on some kind of contract vehicle. Yes. But you use to term earlier that has been around for a long time the Valley of Death. Yeah. So you get them on contract, they've got promising technology. What differentiates those who get across that valley from those who don't? Really it's performance and like that's I think one of the biggest things

12:35that we bring to the table within CT is ensuring performers that if we deem them compelling that we not just put them on contract but there is a funding profile that gets them not just to cross but actually into a scaling mode and you know we talk about that Valley of Death and that for some companies is weeks or months and for some companies it's months and years. But it's iterative with the performers themselves for us to recognize their financial health and there's ways across that not just in awards to performers. Again I mentioned structured finance sometimes it's a blend. We know what the market basket is we know who the performers are that are in that technology domain. We know when the on and off ramps in the contractual opportunities are. So sometimes we need to bring structured finance and or investment private equity and venture capital to the mix as well. So once we understand just the dynamic and what that landscape is for that performer it's ensuring that we bring that mix of perspective awards that are all

13:39performers based. Everything that we do within critical technologies is outcomes based. We deliver capability in 24 months or less. If you don't fit in my construct that's a science project and you mentioned you were chatting with Arnold Jewel earlier and if he's still here we'll have been shout out to Joe. Then we ask you to collaborate with our science and technology folks. We are delivering capability within 24 months or less. All right then I want to bring it back to the folks who actually have to do that work. Your acquisition workforce, your R&D technology experts, this culture change to speed to structured capital is very very different. What have you found necessary to move the workforce to this new model? That early on I think was took a significant effort. I can't really think the culture within the building right now understands that we are moving at the speed of business and we are very active in looking for roadblocks whether it's policy

14:41contractual person in an office who is slow rolling us and we try and just bring radical transparency to everything that we're doing and meritocracy and so that performers can have a clear process and pathway to the different contractual funding opportunities and problem solving for within the department. So I think early on it was a fairly dramatic cultural shift in the building but we have such momentum underway right now. I think the building understands this is how we operate and hey listen we're in a shooting match. A couple parts of the world. So take also that level of intensity and realism that we must do things at the speed of business and deploy these capabilities to our warfighters is just understood. And how are you structuring this for the long term? This really has been an intense focus over the last 18 months but what if you had to redesign institutionally to ensure that this is the new way going forward? Well the culture is certainly a big

15:46part of that and I think we've achieved kind of those culture milestones now or we're well on the way too. It's stripping out sometimes some of these policies and clauses that are decades and decades old and there are many of these are just not even applicable anymore and once they're factored in or impact one of our acquisition processes they slow us down by weeks or months. So it takes it very concerned to kind of audit of again just not far-based but non-far-based acquisitions tweaking those statutes and congress has been tremendous at working with us at massaging some of the statutes that allow us to do a business at the speed of business and just simply recognizing we need to attack those bureaucracies and any any ghost-logger-nades that come our way so that we can move at the speed by which we need to. And as you look forward what are the biggest things you'd like to solve to actually even improve speed and get this this capacity to service members faster? Yeah so in each one

16:48of our CTs we have a senior official and then portfolio directors manage kind of the remainder of the portfolio and as I mentioned measured outcomes so all of our senior officials at any given time typically have five or more sprints that are underway. Those have start date and dates and funding profiles associated with those so it's it's by ensuring that we have measured outcomes and when we begin a sprint I get commitment from the services the resource sponsors and the program acquisition executives to commit to transition at the onset of our sprints. One of the things we recognize very early on was a very low percent of capabilities that actually transitioned to the department or up into the services. Fairly easy fix you just invert the model where we stop prototyping hundreds and thousands of things and trying to push them up into the service or sell them into the services. Now we work with the services and gain their problem statements and inputs so

17:54when we design a sprint we're getting their commitment at transition so not everything transitions certainly but our probability of transition is dramatically higher because we've got the services and the resource sponsors who actually have the money on board with what we're designing and if we hit those performance milestones and we get that thing from TRL6789 where the services say you have achieved what you said you're going to achieve for the service and therefore you know we do want to transition and apply our funding to it as well and then a parallel with that candidly within my office by statue we write the technology road maps for the department of war. So I have significant influence on what the services procure and or try to procure and if they wander too far from that statutorily we have the authorities to kind of bring them back within the technology road maps to ensure that they're procuring the technologies that we have determined are again those most critical ones. As you're going through this critical technology

18:55development process for ones that look like they're going to be successful where the services really want to move them how do you lay in the plan to get them to scale at production? And can't really that becomes less complex because we have buy-in from the P.A.E.s and the resource sponsors and the services themselves our service liaisons and our embeds so they know the wedge and where we apply our funding is to really get them into the into the into the palm or the program ejective memorandum and the funding cycle and if we need to bridge them in the all fears between the palms that's where our funding kind of comes in so it's it's very iterative but very collaboratively with the services of how we apply our funding so that ultimately it gets them and the services to palm for that capability so we're just we're doing that just you know exceptionally collaboratively kind of across our teams and making sure that the funding lines up so there aren't any gap years absolutely yes yes yes Mike Dodd serves as the Assistant Secretary of

19:56War for Critical Technologies thank you so much for joining me today. No thanks for having me I appreciate it thank you we'll post this interview at federalnewsnetwork.com slash federal drive listen to the federal drive on your schedule subscribe wherever you get your podcasts this is the federal drive with Terry Gerton on federal news network what does it take to drive transformational change in large mission driven organizations in this episode of lessons in leadership former Treasury fiscal assistant secretary David Liebrick sits down with WAPA CEO Shane Canfield to explore the answer to that question drawing on nearly four decades of public service Liebrick shares insights on how to maintain employee trust and accountability while striving for strategic leadership and operational excellence he discusses his biggest lessons learned from modernizing major government systems and how he worked to break down silos and build high performing teams all while staying rooted in character and integrity hello and welcome to the lessons in leadership podcasts I'm your host Shane Canfield CEO of WAPA today I'm joined by David Liebrick former fiscal

21:02assistant secretary of the Treasury the department's most senior career position where he spent nearly four decades help oversee and modernize the federal government's financial infrastructure including payments collecting debt financing and cash management David welcome and thank you for being here it's a real pleasure to be here so let's jump right in what does it actually take to drive transformational change inside the federal government and related treasury is obviously a huge organization what did that teach you about leadership as you drove these changes sure I think one of the things that you look that you realize at time is that change in transformational change is very difficult but it is doable and I think sometimes we don't think that you know we can do big things in government and yet we can I think over the course of my career I was enormously fortunate to do work with some other really really wonderful people some of the most preeminent people in

22:04government over the course the last 35 years and from them you learn a lot of really important lessons about leadership I think early in my career what I would tell you is that I was very much new my interacted with political appointees as a civil servant that you're really an advisor and I've had some really wonderful experiences advising some of really great people my second job at treasury for example was as a special assistant to Jay Powell I knew I was not going to be the most the most the smartest person in the room or the expert on many things that we're going on but what I did know is is that I had a very good understanding about what it meant to navigate in government also what it meant to to advise and provide options and analysis to decision makers as you move up in your career and you actually take on more operational responsibility you find out that you are a decision maker and when you are a decision maker you know I had a very good framework that I used throughout my career which is you as a well-edged organization the leadership had to think

23:08about three very distinct things one was thinking strategically about where the organization was going not just about where it was going tomorrow and the next day but actually into the future the second area was that you really had to be able to deliver in the operational excellence so if you're responsible for providing the service or a product you do that well and you think very purposefully about that and the third area is really about people and about how you attract good people how you retain good people how you incent good people and how you really treat people and so throughout my career I had an opportunity to see people be very effective in all three of those areas so when it came time to do transformational change that model worked very well and would also say that what you learn very early on is that regardless is that you as an individual it takes it takes the ability to work collectively and collaboratively with a lot of people and so some of the things that I did for example which were cross-government you realize that you really didn't have authority

24:11over many of the people that you were asking to do something different but if you had character and competence you could actually have trust and so I think when people looked and said this is someone who has capability and they have character they will actually go and and and reduce the friction and actually making change and so those collaborative relationships that those that ability to sort of lead with purpose I think was very important with respect to really driving transformational change yeah that's that's an amazing perspective I just had a chance to listen in a small room to the CEO and the chairman of the board for Mariah Corporation and they're celebrating their 100th birthday next year and many most US companies don't make it to 100 and so it was it was fascinating both of them were asked to what do you attribute this and they said both of them with energy it was

25:17about their people they focused on their people and everything came back to the employees the people that worked there the people that they have to motivate do you find something similar in government I do I actually take a you know oftentimes you hear people say people the most important asset in an organization and there's an element of truth to that but I also think that leadership is probably the most important aspect attribute an organization because if you have the right leaders and you're using a framework like I mentioned you're going to be really focused on getting good people in the organization and those people will thrive I think the thing that you find certainly in government is that federal employees are very mission driven yeah and they are committed and they you know there's a lot of discussion about you know what really motivates people intrinsic versus extrinsic you know motivators and I really do believe that you know when you really get a high performing organization regardless of his private sector or public sector it's going to be those intrinsic things which are going to actually drive employees to do great things and so setting up

26:22those right working conditions to remind people how important they are to actually invest in their development to actually give them good feedback you know one of the things that is really important in an organization is if you really care about an employee and you really want to see them develop you have to tell them not only good things you have to tell them things they have to work on and I think you need to set up an environment and we add a saying which is feedback as a gift and and assume noble intent intent so that when someone gives you feedback your first reaction shouldn't be defensive it should be let me let me make sure I can really understand why I'm getting feedback and what I can do about that you know I think of a story from a book called Radical Candor which the author had gone out and spent a lot of time recruiting a new executive in the organization and thought they had a perfect match they got to six months and the executive was struggling

27:22and they ultimately fired the executive and at the Exeter view the she had turned to the executive and he said well I really was someone who had told me earlier on what I wasn't doing well and I tell that story because I think it sort of says that if you're not giving good feedback to people you spent all this money on recruiting someone all this time and we know it takes a lot of time to bring people on board and if you're not giving them the benefit of you're not giving regular feedback to someone about what they can do better then you potentially have a failure and now you have another vacancy that you have to fill which is very costly and expensive so I think you need to have an idea there's another element of that which is in a high performing organization if people are comfortable raising their hand when something's not going right and in my world large scale operations and what we did every day something doesn't go right it's just inevitable and the issue within a well performing high performing organization is that people will raise their hand and say we have a problem and we need to fix it and the leadership

28:24is receptive to that and says okay what do we need to do and then after the problem is solved you have an obligation to go back and do lessons learned do action learning to see hey what could we have done differently how could we have avoided that problem so that you have a learning organization it's not just that you're comfortable communicating and have trust in the organization that you can communicate openly but also that you're learning as you go along every day to improve your operations the very first podcast we had was Cutler Dawson who was Admiral and the Navy charge of the enterprise carrier and the fleet in the beginning of Desert Storm and then he went on to run Navy Federal the world's largest credit union and was fascinating to hear you because he talked he used an example of a problem they had on deck on air with airplanes on the carrier and it was pretty serious accident that happened his culture was exactly what you said

29:30you've got to talk whether you're at fault or not whether you're partly at fault it doesn't matter we have to have an honest conversation about this and that doesn't mean there weren't consequences but at the same time that honesty has to be front and center it really is true and I think that I think that you raised an interesting point which I think sometimes the word accountability has a negative connotation you're going to be held accountable but also but I would have it in a different way which is we're accountable for high performance and we're accountable to each other to make sure that we can deliver on our mission and that's a positive attribute along the way and I think when when organizations take that seriously the collaboration the teamwork the openness the feedback but they also have a culture of accountability that says we do things well we're going to actually be successful what we do and we all have an commitment to doing that I think you get really a high performing organization you've been listening to a preview edition of Lessons in Leadership to hear the rest of this conversation and all past episodes subscribe to Lessons in

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