Ed Forst never served in the Navy, but the metaphor he uses to describe the role the General Services Administration would make any admiral proud.

Forst, who has been at the helm of GSA since late December, believes agencies, like ships, have two distinct compartments. One is to focus on the mission. The other is the engine room that makes the mission run.

“I think in every business, every enterprise, every agency, every department, and what I think makes great sense, and I believe the President does too, is, let’s advance mission and let’s have the engine room, what’s behind the curtain, consolidate and get even better. That’s where I see GSA in the federal government. We’re the engine room,” Forst said at the Coalition for Common Sense in Government Procurement winter conference on Jan. 14. “Now, interestingly, GSA is its own agency, so we happen to have both. We’ve got mission and the engine room as well. So I think because of that, we really do appreciate the mission piece of that and serving our stakeholders and our constituents.”

For GSA, being that engine room in part means making acquisition less burdensome, cheaper and more agile so agency customers can meet their mission needs more quickly.

GSA has been pursuing several initiatives over the last year to fine tune the acquisition piece of the engine room.

Laura Stanton, the deputy commissioner of GSA’s Federal Acquisition Service, said between the Office of Centralized Acquisition Services (OCAS), the OneGov initiative and the implementation of changes from the Federal Acquisition Regulation rewrite, GSA is delivering speed to acquisition like never before.

For example, OCAS now centrally buys for three agencies: the Office of Personnel Management, the Small Business Administration and the Department of Housing and Urban Development. Stanton said GSA brought on OPM and SBA in about a month.

Stanton said OCAS is using an opt-in approach to help agencies and trying to relieve some of the burden on GSA’s Assisted Acquisition Service.

“We’re having conversations with a number of agencies about what are their needs. One of the things that we set up OCAS to be able to support is the buying of common goods and services,” Stanton said. “We also recognize that there are mission critical items that and there’s common things that are mission critical that can be used for governmentwide contracts, and then things where there are specialized contracts. So we’re having those types of conversations with a number of agencies at this point.”

Under the OneGov program, GSA has signed 18 agreements to reduce the price of commonly used software across government. Additionally, 45 agencies have taken advantage specifically of the enterprisewide agreements for artificial intelligence tools.

“This is a radical shift in how we think about it, and how we think about how we come to market, and also how we want you to treat us as a customer,” Stanton said at the conference. “This requires changes, not only on the government side, but it’s also going to require changes on the industry side to make that happen. We want to be better aligned when it comes to terms pricing and performance, when it comes to all aspects of that.”

Forst said he was especially focused on the performance aspects of the equation for GSA.

Measuring performance against peer groups

He said measuring performance, and holding organizations and people accountable are among his key focuses areas.

“We’re putting out some priorities for having deliverables. I’m committing every quarter and I’m going to report on ourselves on that,” he said. “I think we’re all better if we find a way to talk about measurement or metrics, whatever you want to call it. There’s a common language and vocabulary about that, so I am a big proponent.”

Forst said he will be looking at both the performance of FAS in terms of “revenue,” as well as their performance relative to peer organizations.

“If you had a record year, you’d probably beat plan. All that should be good. That’s absolute measurement. That’s you versus you. And I think that’s important. I think it’s also really important to accompany that with who’s in your peer group and how did they do? I think the relative performance matters a ton as well,” he said. “You could be down 7% and on an absolute basis, angst to death over down seven if your peer group’s down 15, that’s a home run. So I think it’s important. But if you had a record year and you’re up 6% and your peer group’s up 12%, I’d say good record, but you underdelivered versus the other side. I think we have to be honest with ourselves and look at both us versus us over the time series, and look at us versus a peer group. That seems to make sense.”

Forst said GSA plans to bring in a peer group analysis to raise their awareness and their overall performance.

The third piece of moving bringing speed to capability is the FAR rewrite. GSA will begin implementing the FAR changes within its own acquisition regulations in the coming weeks. It already issued deviations to the current FAR to begin the process.

Jeff Koses, GSA’s senior procurement executive, said in a post on LinkedIn that they have “limited the issuance of mandatory acquisition policies to my office, the Office of Acquisition Policy. Legacy mandatory policy will have to be reissued at the agency level, converted to discretionary guidance, or cancelled.”

Koses said GSA will begin culling down 500 pages of its acquisition manual, 300 pages of office policy, 500 pages of FAS policy and another 500 pages of Public Buildings Service policy and then 1,000 pages of real property leasing policy.

Reviewing the GSA schedule catalog of items

Larry Allen, the associate administrator in the Office of Governmentwide Policy, said at the CGP conference that GSA, in helping out the FAR Council, is working closely with OFPP to get all of the rulemaking completed by the end of the fiscal year.

“It may be delayed a little bit because we had a little shutdown in the fall, but that tells you exactly what type of timetable we are on. It’s aggressive, and you will see change, and we want you to be part of that change,” Allen said.

Stanton added that GSA understands the FAR rewrite has moved quickly and is addressing complex acquisition issues that will take time for government and industry to wrap their arms around.

“When we think about this year, it’s going to be a year of both adopting and adaptation, and acceleration all at the same time, and that becomes really challenging to do,” she said.

Stanton said another key initiative kicking into gear this year is GSA’s review of its multiple award schedule catalog. She said the driving theory is how can the agency operate it more efficiently and deliver more value to agency customers.

“I look at the at the catalog that we run for the multiple award schedule and it has over 100 million items in it. Only 1% or fewer of those items sell, and so this is putting burden on all of you, making sure that you’re meeting all of our terms and conditions, that those items are Trade Agreements Act (TAA) compliant, that they meet the government standards, and that the pricing is fair and reasonable,” she said. “We have contracting officers who have to evaluate those items, and what is the value that either you or the government is getting for that work? I think that this is a big opportunity for us to truly assess where is the government’s demand. As we’re also moving into making transactional data reporting mandatory, how do we effectively have a catalog that delivers on what the government needs? How do we meet those needs effectively? How do we move quickly if we have something that’s not in the catalog? It’s a lot easier to move quickly if we’re not burdened by putting things in there that are not actually being used.”

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OPINION — The Pentagon’s push to overhaul its slow, specification-driven procurement system is an overdue acknowledgment that our defense industrial base has become too narrow, too fragile, and too dependent on foreign supply chains. America’s defense establishment is finally waking up to a critical weakness that has metastasized in recent decades: we have drifted away from the industrial might that once formed the bedrock of our economy and allowed us to out-produce any adversary in the world.

While there are many warning signs, one symptom of the problem is unmistakably clear: the United States is not producing what it needs at the speed and scale modern conflict demands. Recent reporting shows the U.S. Army is still struggling to meet its 155mm artillery-shell production goals after years of effort. Across the spectrum—from advanced missile interceptors to something as basic as black powder—we are falling dangerously behind in both production capacity and supply-chain resilience. For now, these shortfalls are appearing in conflicts that don’t directly involve American troops, but the truth is that a major war will see the United States forced to ration materials and munitions, deploying untested prototypes on the battlefield while the defense industrial base races to catch up. We must act now to prevent this from happening.

If we are serious about winning the next war—or better yet, deter it—we must rethink both how we buy military equipment and weapons, and how fast we can make them. We don’t need another half measure or a fully government solution. Instead, the government should leverage the private sector to build a nationwide network of multifaceted, resilient manufacturing nodes that can surge production of everything from drones, vehicles, and body armor to medicine, munitions, and microelectronics in times of crisis, while sustaining production lines for commercial products in peacetime. The power of the U.S. economy can, and should, be leveraged to solve this problem.

This network of production centers, or campuses, would bring together startups and established manufacturers in the same ecosystem, enabling the kind of rapid prototyping, pilot production, and full-rate manufacturing the Pentagon is urgently seeking. Each of these campuses would be designed for flexibility, with modular production capabilities that can be rapidly upgraded, and shared heavy infrastructure such as test beds, utilities, and analytical systems. Furthermore, these facilities would be part of a connected national network, leveraging the regional strengths of each part of the country while avoiding the single points of failure commonly found in today’s highly concentrated manufacturing hubs.

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Today, the gap between a successful prototype and real-world production is often a chasm in the defense industrial base. Major firms are often tied up maintaining legacy systems while cash-strapped startups cannot afford to build compliant, capital-intensive factories without production contracts. These startups are often told that contracts won’t come until they prove they can manufacture at scale. So promising technologies stall in a chicken-or-egg limbo while delays snowball. The Pentagon’s renewed embrace of OTAs helps, but money alone won’t fix a physical bottleneck. We need places where cutting-edge firms can scale quickly, and affordably.

A national network of industrial campuses is designed to fill this gap. Under this model, companies wouldn’t pay construction costs up front; lease payments would begin only after they move in and start generating revenue. Layering into the model a certain number of shared facilities—initially funded by the Pentagon—would reduce risk, accelerate development, and dramatically shorten production timelines. Young companies gain room to grow. Established firms gain access to fresh innovation - and taxpayer dollars go further.

This is not a radical idea. It is an evolution of the model that once made America unstoppable. In World War II, factories across the economy—automotive, textile, consumer goods, and more—transformed to support the war effort. That surge capacity happened because the United States had an existing industrial ecosystem ready to mobilize. Today, we no longer have one.

Decades of offshoring, consolidation, and a fixation on short-term efficiency have left our industrial base brittle and full of holes. COVID-19 made that painfully clear when the world’s largest economy found itself dependent on foreign suppliers for PPE and basic supplies. Semiconductor shortages still slow defense and automotive lines. Meanwhile, our adversaries are turning basic industries into warfighting assets. Russian bakeries are producing drones and China is treating its manufacturing capabilities as a strategic weapon while in America, we’ve been treating our manufacturing base like an accounting exercise.

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The government must shift course. Manufacturing is a strategic asset—every bit as important as ships, planes, satellites, or submarines. Washington should fund shared industrial infrastructure, de-risk private investment, and let market forces drive efficiency.

The math is simple. In some cases, companies piloting these programs have delivered 4:1 to 25:1 returns on tax dollars, generating major gains for minimal government investments. With a defense budget exceeding $800 billion, the Pentagon can easily afford to invest a sliver of that—well under one percent—to send a clear, unambiguous demand signal to the private sector that America is rebuilding its industrial backbone, and doing it now.

History shows what happens when we do. Modest seed capital during World War II and the Apollo program unlocked massive private investment and generated hundreds of innovations that have come to define the modern age. These campuses would be more than factories—they would be hubs where manufacturers, universities, investors, and federal partners build self-sustaining ecosystems capable of accelerating innovation, fostering talent, and producing critical goods at scale. They would restore American industrial depth, innovation, and flexibility—our most reliable, most underestimated tools of deterrence.

America is racing into the next complex era of great-power competition with a defense industrial base limping along from the last era; one that is simply too small, too fragile, and too slow. We can invent extraordinary technologies, but what use are they sitting in a lab if we can’t produce them at scale? If that doesn’t change, the United States risks discovering—too late—that innovation without industrial power is a hollow advantage.

Rebuilding American manufacturing will be difficult. But the cost of inaction is far higher. A nation with a deep, flexible industrial base can surge production, absorb economic shocks, and outlast any adversary, on the battlefield and the home front. A nation without one is forced to ration weapons, delay deployments, and scramble to keep its supply chains functioning.

We can build this network now or we can wait for a crisis to expose, once again, how fragile our industrial base has become. In the next conflict, the world’s strongest military must be able to depend on its factories to keep up.

The Cipher Brief is committed to publishing a range of perspectives on national security issues submitted by deeply experienced national security professionals.

Opinions expressed are those of the author and do not represent the views or opinions of The Cipher Brief.

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FEATURED INTERVIEW — As the Pentagon undertakes its most ambitious overhaul yet of how it acquires new warfighting capabilities, Silicon Valley entrepreneurs are weighing in on whether the modernization effort can happen quickly enough to bring the U.S. up to speed with China in a time of rapid technological development.

When the overhaul was announced earlier this month, Secretary of War Pete Hegseth said the reforms aims to dramatically accelerate how the Department buys and fields new capabilities and that the changes are specifically aimed at cutting bureaucracy, rewarding rapid development, and pushing defense primes to invest more of their capital in new capabilities.

In the weeks since the announcement, the U.S. Army has shared details on how it will reform its service-level acquisition process. Part of the change involves consolidating the service’s program executive offices (PEOs), which are responsible for buying new weapons, into six new offices called “portfolio acquisition executives” (PAEs). Plans also include the creation of a new office to rapidly field and scale emerging technologies. Similar initiatives are in the works at the other services.

Measures like these have been championed by the private sector, which has traditionally on the cutting edge of innovative capabilities for decades. Cipher Brief COO & Executive Editor Brad Christian caught up with Entrepreneur and Stanford Professor Steve Blank, who recently published a Department of War Program Executive Office directory to help entrepreneurs better navigate the current complicated system for selling to government. Their conversation has been lightly edited for length and clarity.

Steve Blank

Steve Blank is an adjunct professor at Stanford and co-founder of the Gordian Knot Center for National Security Innovation. His book, The Four Steps to the Epiphany is credited with launching the Lean Startup movement. He created the curriculum for the National Science Foundation Innovation Corps. At Stanford, he co-created the Department of Defense Hacking for Defense and Department of State Hacking for Diplomacy curriculums. He is co-author of The Startup Owner's Manual.

THE INTERVIEW

Christian: Describe your initial reaction to the Pentagon's somewhat surprise announcement that it was overhauling its acquisition process.

Blank: It was mind blowing. It was mind blowing not because anything the Secretary said was new; these are things that people who are interested in acquisition reform have been asking for the last 10 years. But it was put in a single package and was clearly done by the infusion of people who have actually run large businesses and were used to all the language of organizations that already know how to deliver with speed and urgency.

The part that didn't get said, is essentially that the Department of War wants to adopt startup innovation techniques of lean iteration, pivots, incremental releases, good enough delivery, and that gets you what the Secretary asked for, which was speed of delivery. But all those are things that we've lived with in Silicon Valley for the last 50 years. And it wasn't until we had people who worked outside of buildings with no windows inside the Pentagon to understand that those techniques could actually be applied. And it required blowing up the existing system. And they did that spectacularly well. There are very few holes in these proposals.

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Christian: Obviously the Pentagon procurement system is a product of decades of bureaucracy and rules. Are you hopeful that you're going to be able to see the kind of change in the rapid timeline that they've laid forth here?

Blank: Number one, this is a pretty extensive reorganization. Right now, the Department of War is siloed between requirements and system centers for testing and prototyping and acquisition, which was the acquisition with a small A with the PEOs and program managers, and then it went to contracts and then it went to sustainment, et cetera.

Those were silos. Now we're putting it all underneath a single portfolio acquisition executive. So, instead of making their offices 10,000 people, it's actually a matrix organization, much like a combatant command is. Most of those people will stay in their existing organizations but now be tasked to work on specific portfolios. And the portfolios will no longer be arranged by weapons system. They're going to be arranged, for example, by war fighting concepts or technology concepts, et cetera.

That said, boy are they trying moving an elephant and make it dance. And at the same time, they recognized - this was one of the genius parts - that people won't just get a memo and know what to do. Historically, they've depended on the Defense Acquisition University, which taught contracting officers and the rest, how to work with the 5,000 pages of the DFAR and FAR, Federal Acquisition, Defense Acquisition Regulations. One of the unnoticed things was that they basically told the Defense Acquisition University, to stop teaching what they're teaching today, recognizing that they need to teach people this new methodology. That's not going to happen by telepathy.

First of all, we need to train the trainers, then we need to train all the people who've grown up in their career following the paperwork. I predict six months or a year of chaos and confusion. And there are always saboteurs in a large-scale reorganization who are angry that their cheese has been moved or worse, their authority has been diminished or their head count went somewhere else. This is going to be no different except maybe at a bigger scale.

In the end, if we pull this off (and I'll explain the only possible reason not to do this) the country will be much better for it.

The other obstacle will be if you're on the board of directors and the executive staff of a prime, you're going to go through the 12 stages of denial and grief and whatever because I don't know how many times both Deputy Secretary of Defense Steve Feinberg and Secretary Hegseth made it clear that the primes weren't delivering and they weren't investing in the things the country needed and they got used to the system and we were kind of mutually dependent on a broken system - and that's over. Well, you're not going to let your stockholders say you just went home and packed up. Obviously, it's pretty clear that appealing to the Pentagon isn't going to work, but Congress is “coin operated”. This is now going to be a race of lobbying cash from the primes versus lobbying cash for the first time from private equity and venture capital. So it's going to be, who has the biggest pile of cash to influence Congress and the executive branch to keep these rules in place or modify them?

Remember what a disaster this is if you're an existing large company selling to the DoD. It says number one, we're going to buy commercial off the shelf. Number two, we're going to buy commercial off the shelf and then modify it. If and only if either one and two work, we will do some bespoke contracting with the existing organization. It's never happened before. Pretty clear, pretty direct. So, the easy thing would be for primes to change their business model. But my prediction is they're going to double and triple down on the amount of lobbying and dollars spent.

Christian: In addition to the lobbying are we going to see consolidation? A major prime, like you said, isn't going to just pack up their bags and go home. Are they just going to start scooping up all of the small commercial providers?

Blank: In the space segment, they were already doing that. And in fact, were told to kind of stand down and that these things needed to flourish. You have to remember that primes and corporations are companies. Their number one priority, at least in their heads, is no longer national interests, it's the shareholders and returns and revenues and profits. That's the nature of capitalism. The problem here is that the Department of War said, 'Well, that's nice, but we're not getting what we need out of that. Send a note to your shareholders that life's about to change'. That's going to create a lot of conflict - with a lot of money involved - in trying to bend the rules back.

And just as an aside, the primes aren't useless. You don't want them to go out of business. No startup is building an aircraft carrier or a joint strike fighter. We can make the argument of whether we should anymore, but that's secondary. That level of complexity and skill set is just not built yet. Maybe the Andurils and others will get there in another five years, but they're not there yet. And so, waving a wand and making the primes go away completely is equally inane as saying we could depend on startups for everything that the Department of War needs.

But the balance of power, at least as the secretary and deputy believe, is that we need to be building things faster and delivering them faster and on time. And we're going to look for alternate sources. That's just a mind blower. So, as I said, I see six months to a year of confusion as this reorganization happens and people come and go as they establish who's in charge, what the rules are, et cetera.

The only good thing about making this happen is in a normal administration, the administration would wait for Congress's approval. I've not seen that happen in many of these cases with this administration. And in this case, it might actually be good for the country. Time will tell.

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Christian: You referenced decades of Silicon Valley's experience with iterating and moving quickly. One of the threats and one of the actual challenges that a country like China poses to America is they have a top-down autocratic government that doesn't change every four years. That presents a unique challenge to the Pentagon that Silicon Valley doesn't know, or the private sector doesn't necessarily have. How much of a risk is there for the next administration to come in and potentially change everything? And then, if you're one of those big primes, are you baking that into your long-term planning that this might shift in a measurable way in the future? Or do you think these changes are going to be something that is so overwhelmingly positive that future administrations have to stick with it?

Blank: Well, if you were asking me this three years ago, I would have said you should get all this done now because it's going to be flipped back in three years. What's different now though, is the amount of capital available for startups, scale-ups, and private equity firms that can match or overpower the lobbying efforts of the primes. So as I said, both the executive branch and Congress are coin operated, even more so now than ever. And for the first time ever, the insurgents have as much or more coin than the incumbents. That's what's going to change this game.

So yes, a Democratic administration or another Republican one might have a different opinion. But in this case, we're talking about piles of money flooding the streets of Washington D.C. to try to change the game. Think about who is now sitting in the cabinet and in other places where we're seeing people with commercial experience for the first time ever at scale, inside the executive branch for sure and inside the Department of War which changes the nature of the conversation and as we're seeing - the types of things they're recommending. It wasn't that people didn't recognize this before. It was kind of hard to explain this to people who had never run a business or who have been career successful. I've said for years, we had world class organizations, world class people for a world that no longer existed.

Finally, we have people who understand what that world should be like because they've been operating in it. Secretary Feinberg has been writing checks for tens of billions of dollars- buying aircraft carriers, okay, he’s written those kinds of checks before. Tell me who else has ever been in that position.

Again, it's not that the DOW should run like a corporation or a startup, but having that experience sets a bar for what you know is possible for doing extraordinary things. It's what this country knew how to do in World War II and during the Cold War, and we just kind of lost it when Robert McNamara, ex-chief financial officer of Ford, put in the first version of the Planning, Programming, Budgeting and Execution System (PPBE) in 1962. We've been operating on that system for 63 years, or some variance of it.

Basically, he imposed a chief financial officer's strategy on budgeting and planning, which made sense at the time. It stopped making sense about 15 years ago, but no one inside the building knew what to do differently. That's changed.

There was also one set of announcements that kind of flew under the radar, and that was that the policy organization in the DOW lost three organizations to acquisition and sustainment (A&S). I think Elbridge Colby runs that group and it went to A&S. So all the foreign military sales and all the policy stuff kind of disappeared overnight. I don't know what the talking points will be, but the optics aren't great for policy. That's number one.

The second thing that got buried in the memo and I'm not sure it was in the speech, but this new Economic Defense Unit (EDU) I think has taken over the office of strategic capital. And I think that's good given what the agenda is, which is that we're essentially using the whole of nation approach to decouple from China and not only invest in critical minerals but in the other parts of the ecosystem that we need as well, everything from batteries to drone motors to whatever. So we can operate independently. Scaling that unit up was strategically as important.

This was an acquisition announcement, but watching all these other moves are really smart chess pieces at scale, not just nibbling around the edges, but at scale. And I think paying attention to the other moves that are being made inside the DOW, you'll at least understand the master chess game that they're at least trying to implement. It's pretty smart.

Christian: You've done incredible work recently with helping people understand and navigate his environment in ways that perhaps were difficult for people to understand before. What are you going to be looking for next and what are you potentially going to be working on as a result of these changes?

Blank: I think you're referring to the PEO directory that I wrote, which is about 300 pages long. It’s the first phone book for the Department of War with a 30 page preamble of go-to-market strategies. I literally have started rewriting it and it's now going to be called the Portfolio Acquisition Executive Handbook and now it's going to explain how PAEs work and what the silos looked like before and how each service is reorganizing.

For example, the Army likely will condense 12 PEOs into six portfolios and make major shifts, this month or certainly by the end of the year. And the other services will follow. I think the Army is a little ahead of everybody else. But having a phone book to actually explain who's who and what they're supposed to be doing.

As I said, it will be six months to a year of chaos and I think having some kind of handbook that at least shows you where things are heading and who are the new people to call on would be helpful. So that's what the Stanford Gordian Knot Center for National Security Innovation is doing.

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The core argument: if the U.S. wants to deter adversaries in today’s world of fast-moving threats that include gray-zone coercion, contested logistics and AI-enabled systems, it must accept more acquisition risk as a means to reduce operational risk later.

The Pentagon’s new plan pairs rhetorical urgency with specific structural changes. It proposes killing the legacy Joint Capabilities Integration and Development System (JCIDS) and replacing it with a tighter, more centralized alignment, pushing commercial-first solutions even if they deliver an “85% solution” initially and forcing a cultural shift across both DoD and industry toward speed, volume, and continuous iteration. The plan also signals tougher expectations for primes to invest private capital and for government to send longer demand signals. It’s a tall order.

Here’s a look at the key ideas:

• “Increase acquisition risk to decrease operational risk”: field good-enough capabilities faster, iterate in production, and stop chasing perfect specs that arrive too late.
• JCIDS → RRAB / MEIA / JAR: cancel the slow, document-heavy requirements process; stand up a Requirements & Resourcing Alignment Board (RRAB) to tie priorities to funds, a Mission Engineering & Integration Activity (MEIA) to co-design/experiment with industry early, and a Joint Acceleration Reserve (JAR) to bridge the “valley of death.”
• War-fighting Acquisition System & PAEs: rebrand and reorganize acquisition around Portfolio Acquisition Executives (PAEs) who have end-to-end authority to trade cost/schedule/performance for time-to-field, with embedded contracting and fixed delivery cycles.
• Modular Open Systems + multi-source: mandate modular architectures, maintain at least two qualified sources on critical components, and enable third-party integration to avoid vendor lock and accelerate upgrades.
• Commercial-first, 85% solution: accept non-perfect bids that meet the mission faster, then iterate software and components continuously.
• Wartime Production Unit (WPU): a deal-team model to negotiate across a contractor’s total DoD portfolio, create incentives for on-time delivery, and unlock surge capacity.
• Workforce & Culture shift: convert the Defense Acquisition University (DAU) into a “Warfighting Acquisition University,” lengthen leader tenures, and evaluate contracting/program teams on mission outcomes rather than compliance metrics.
• Foreign Military Sales realignment: move DSCA/DTSA under Acquisition & Sustainment to unify planning, contracting, and delivery so allies get kit faster without undercutting U.S. readiness.

Why this matters now

Adversaries are iterating faster, supply chains are brittle, and the U.S. military’s ability to produce and sustain at volume - will decide deterrence credibility. The proposal promises measurable gains in lead times, throughput, and availability, but it also raises hard questions about safety, governance, industry incentives, and the talent pipeline.

In the sections that follow, we pressure-test these claims with former commanders and acquisition leaders: how to set guardrails around “good-enough,” where the new risks are and the impact on the industry.

Cipher Brief Executive Editor Brad Christian spoke with General Phil Breedlove (Ret.), Lt. General Mike Groen (Ret) and Silicon Valley Entrepreneur and Stanford Professor Steve Blank, who has recently published a Department of War Program Executive Office directory to help companies better navigate the complicated system for selling to government.

Christian: What was your reaction to last week’s announcement that we heard from the secretary?

General Philip M. Breedlove

Gen. Breedlove retired as the Commander, Supreme Allied Command, Europe, SHAPE, Belgium and Headquarters, U.S. European Command, Stuttgart, Germany.  He also served as Vice Chief of Staff of the U.S. Air Force, Senior Military Assistant to the Secretary of the Air Force; and Vice Director for Strategic Plans and Policy on the Joint Staff.

General Breedlove: There are things that I really am looking forward to, and there are some things that are a bit worrisome, the way they were rolled out. But you never really know what's going to happen until you start seeing it in action and the changes to the rules for how we do our acquisition.

But make no mistake, our acquisition system to date is moribund. It's horrible. We laugh now about this “Valley of Death” between when something is created in the laboratory and when it gets to the field, six, seven, eight years or more sometimes. And people who are at war and doing this very differently, they're doing it in weeks, sometimes days, but not years. So we definitely have to change.

Part of the reason our acquisition system is so slow is because in our past, maybe even decades and decades ago, people took advantage of the system and they made money in a bad or almost illegal way. And so lawmakers do what lawmakers do, and technocrats and bureaucrats do what they do, and they created layers and layers of oversight to try to protect against some of those bad acts that happened decades ago. And the result is an acquisition system that is completely unresponsive to the needs of the warfighter. And I'm glad that we're starting to change it.

Lt. Gen. Michael Groen (US Marine Corps, Ret.)

Lt. Gen. Groen served over 36 years in the U.S. military, culminating his career as the senior executive for AI in the Department.  Groen also served in the National Security Agency overseeing Computer Network Operations, and as the Director of Joint Staff Intelligence, working closely with the Chairman and Senior Leaders across the Department.

Lt. Gen. Groen: My immediate reaction, like everybody else, when somebody uses the word acquisition, you kind of cringe a little bit. And immediately you get the vent of, it takes too long, it's too expensive, the processes don't work, the people in the processes don't know what they're doing, the long litany of usual complaints. And most of them are actually true. What we have currently, I would articulate, is an unaccountable bureaucracy. It's a professional bureaucracy. They know the process. They build the process. They work the process. But the process doesn't necessarily meet our real war fighting objectives. And I think that is probably the most important thing here.

We'll talk about drones and technology and all these other things, but I think at its core, you actually do have to have a process for this. And just getting the credit cards out and buying stuff at Best Buy doesn't work either, right? So, I think it's a requirement for us. You can't just say, well, we're just gonna blow up all the rules and let people do whatever they want. Because as soon as you do that, you're gonna realize that if we didn't have a system, we wouldn't be able to do all these other things. How do you get to integration? How do you get to common standards? How do you get to the things that actually make weapon systems work effectively and with the caliber of ammunition that they use and the system that produces that and all of the other components? So it's easy, and I've done it probably more than anybody else, to just rant about the acquisition process.

But if you didn't have an acquisition process, you would need to invent one. So, our challenge really today is, okay, the one we have for a lot of reasons is not going to be the one that we will need tomorrow. It does okay on band-aids and making munitions for today. But it is certainly not a kind of process that enables war fighting flow. So I think we are very much at a transformation point, not just in the fact that the way we want to do acquisition must change, but more importantly, the way we do everything, the way we fight must change. And so naturally we have really an incredible opportunity. Let's build the system that enables the kind of fast moving, rapid innovation that we will want on the battlefield: AI driven, data driven. We know what the future looks like. Let's actually build to that and not let unaccountable bureaucracies get in the way.

Steve Blank

Steve Blank is an adjunct professor at Stanford and co-founder of the Gordian Knot Center for National Security Innovation. His book, The Four Steps to the Epiphany is credited with launching the Lean Startup movement. He created the curriculum for the National Science Foundation Innovation Corps. At Stanford, he co-created the Department of Defense Hacking for Defense and Department of State Hacking for Diplomacy curriculums. He is co-author of The Startup Owner's Manual.

Blank: It was mind blowing - not because anything the Secretary said was new; they are things that people who are interested in acquisition reform have been asking for the last 10 years. But it was put in a single package and was clearly done by the infusion of people who have actually run large businesses and were used to all the language of organizations that already know how to deliver with speed and urgency.

The part that didn't get said is essentially the Department of War wants to adopt startup innovation techniques of lean iteration, pivots, incremental releases, good enough delivery, and that gets you what the Secretary asked for, which was speed of delivery. But all those are things that we lived with in Silicon Valley for the last 50 years, and it wasn't until we had people who worked outside of buildings with no windows inside the Pentagon to understand that those techniques could actually be applied. And it required blowing up the existing system. And they did that spectacularly well. Very few holes in those proposals.

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Christian: A central piece of the plan as it was explained on Friday is the idea of eliminating the Joint Capabilities Integration and Development System, which has long been criticized for some of the slow processes and the overly bureaucratic results that we have. The new approach seeks to centralize procurement and funding under the DOD senior leadership. Are you comfortable that this is the right approach?

General Breedlove: So this is one of those, like I opened up with, some good, some bad. There are elements of JCIDS that I think we should hold on to. We shouldn't throw the whole thing out with the bath water. But there are a lot of elements of JCIDS that we need to get rid of.

Much like the rules we just talked about that were created because of people and bad acts for acquisition, the same sort of thing has happened in the process of moving an idea from the lab to the field in that now there are layers and layers of people who can hold up the process or say no. And when they do that, it adds time, schedule delays, more testing, and much more money to the program. And these people bear zero responsibility for their actions. The people that end up getting blamed for the delays and increased costs are the services or the primes. And the people that have this authority now but hold no responsibility for what they do, we've got to get rid of them. We have to ensure that people who have decision authority are held accountable for what they do, to the point of maybe even not charging this off to primes or to the folks who are developing these things. If someone else is out there slowing things down and they don't have to worry about it because they're not accountable to it, we're not in a good place.

Lt. Gen. Groen: One issue is there isn’t a cadre of professionals in DOD leadership that will be able to take this mission on full time. If you consider a broad sweep of what we build and acquire and how we do that, how we innovate, they will just run out of hours in the day and minds to engage in order to build a replacement for what we have today.

The impulse to change the way we do things is the right impulse. Our impulse to be disciplined about the way we go about things, that's also correct. So it's not enough to say “let’s blow it all up, we don't need any rules”. We actually do need rules. Regulation actually is an enabler. It helps you flow. It lets you know how things can be done. That's a really powerful thing.

The problem is with humans involved, there is always a tendency to distort a process through petty bureaucracies, tribalism, ignorance and bad temper. It is really important for leaders to actually lead in this space and create accountability for the people that are actually working. What we have today is a derivative of it. We don't need too many history lessons here, but this is like General Motors in the 1960s, where we started to really do modern industrial design at scale. So if you understand where we’ve come from, you can see how important things like industrial processes and quality checks.

In a digital environment, a transformational environment that is driven by artificial intelligence and data availability, all the notes change. The music changes. And you still need a process for things like money so you can pay people to build things. But we're not building things on a conveyor belt anymore. We're building code. We're building code that changes by the hour. We're building code that builds its own code. This is where we are. So you can't do that in a completely undisciplined way, that says “have at it team and we'll see what we get at the end of the process”. What we’re doing here is too important.

Christian: Part of the new approach will involve increasing acquisition risk, to decrease operational risk with a focus on increased use of commercial solutions and of even fielding 85 % solutions. Where's the red line that you would want as a commander before fielding an 85% solution?

Gen. Breedlove: This is a concept which is extremely hard to criticize. But we have to be pretty serious here because you're saying increasing acquisition risk to decrease operational risk. Well, if the product isn't operational yet and we have increased the purchasing and acquisition risk, and in between that costs us the life of a soldier, sailor, airman, marine or guardian, we have messed it up. So the rules are there for a reason. I completely understand. I absolutely, 100% agree with the fact that we've got to start taking more risk, but we can't do that in a way that is reckless and puts the lives of our troops on the line.

And an example where I think this concept is working well is Ukraine. They get a new drone that is designed to get past a certain capability of the Russian defenses. And why should we do a two-year testing on that thing? If the testing is to fire it into Russia where it's not going to kill any friendlies and see what happens, let's fire it into Russia and get the testing done on the battlefield, where we're less concerned with what happens. So there are ways to shorten and to change the way that we do tests and other things on the acquisition side that gets us faster to the operational side. And if we can do that, again, without raising the risk to our troops, let's go for it. And we're seeing that done well by the Ukrainians, and to some degree by the Israelis.

Lt. Gen. Groen: The first thing that pops in my mind is- What does an 85 % solution look like? What is 85% of a truck? What is 85% of a battleship or a carrier? Pick your system. If you're just doing software, you can do a lot of things in software, but still, software that's 15 % buggy and doesn't work, because you've chosen 85%, that's almost like going right back to the industrial age process flow for code. And I think that the real magic here at its core is transforming the way we do our war fighting. We need new thinking about how to integrate capabilities and new thinking about how to build artificial intelligence modalities and then the systems.

Warfare is changing under our feet right now. Ukraine and drones, I accept that example, but it's so much more than that. We need a complete transformation in the way we understand the enemy, the way we understand our mission, the way we can use autonomy to integrate with humans, the way that we can build robotics, the way that we can now start what I like to call putting the mind of a commander on a pedestal by taking all the data environment and revealing that to a commander and everybody else who is working with the commander so that you have common situational awareness.

The opportunity here is enormous to transform our war fighting to the same degree we're transforming our industries. And you see the transformation every day when you drive through DC or Austin or San Francisco. Transformation is real and it's driving our economy today. What we haven't done is purposefully mapped out how we're going to drive our war fighting capability through this technology. And this is so important because we have to have a plan for how we build operational workflows. Where do we build those? Who builds those? And so I think moving from monitoring a process of manufacturing to really considering war fighting as the core element that the technology springs from.

Christian: Obviously the Pentagon procurement system that we have today is a product of decades of bureaucracy and rules. Are you hopeful that you're going to be able to see the kind of change in the rapid timeline that they've laid forth here?

Blank: Number one, this is a pretty extensive reorganization. Right now the Department of War is siloed between requirements and system centers for testing and prototyping and acquisition, which was the acquisition with a small A with the PEOs and program managers, and then it went to contracts and then it went to sustainment, et cetera. Those were silos. Now we're putting it all underneath a single portfolio acquisition executive. So, instead of making their offices 10,000 people, it's actually a matrix organization, much like a combatant command is. Most of those people will stay in their existing orgs but now be tasked to work on specific portfolios. And instead, the portfolios will no longer be arranged by weapon system. They're going to be arranged, for example, by war fighting concepts or technology concepts, et cetera.

That said, boy, try moving an elephant and making it dance. And at the same time, they recognized - this was one of the genius parts - people won't just get a memo and know what to do. Historically, they've depended on the Defense Acquisition University, which taught them, contracting officers and the rest, how to work with the 5,000 pages of the DFAR and FAR, Federal Acquisition, Defense Acquisition Regulations. One of the unnoticed things was they basically told the Defense Acquisition University, stop teaching that today. You now need to teach people this new methodology. That's not going to happen by telepathy. First of all, we need to train the trainers, then we need to train all the people who've grown up in their career following the paperwork.

So, I predict six months or a year of chaos and confusion. And probably, there's always in a large scale reorganization saboteurs who are angry that their cheese has been moved or worse, their authority has been diminished or the head count went somewhere else. This is going to be no different except maybe at a bigger scale.

In the end, if we pull this off, and I'll explain the only possible reason not to do this, the country will be much better for it. The other obstacle will be if you're on the board of directors and the exec staff of a prime, you're going to go through the 12 stages of denial and grief and whatever because I don't know how many times both Feinberg and Hegseth made it clear that the primes weren't delivering and they weren't investing in the things the country needed and they got used to the system and we were kind of mutually dependent on a broken system - and that's over. Well, you're not going to let your stockholders say you just went home and packed up. Obviously, it's pretty clear that appealing to the Pentagon isn't going to work, but Congress is “coin operated”. This is now going to be a race of lobbying cash from the primes versus lobbying cash for the first time from private equity and venture capital. So it's going to be, who has the biggest pile of cash to influence Congress and the executive branch to keep these rules in place or modify them?

Remember what a disaster this is if you're an existing large company selling to the DOD. It says number one, we're going to buy commercial off the shelf. Number two, we're going to buy commercial off the shelf and then modify it. If and only if either one and two work, we do some bespoke contracting with the existing organization. It's never happened before. Pretty clear, pretty direct. So, the easy thing would be for primes to change their business model. But my prediction is they're going to double and triple down the amount of lobbying and dollars spent.

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Christian: Secretary Hegseth also had some words of warning to the major U.S. defense contractors, the primes, to speed up weapons development and production, invest their own capital to increase capacity, or risk becoming obsolete. This is a relatively complicated issue for these companies. What are your thoughts on this?

General Breedlove: I think that our senior leaders, maybe to include the Secretary of War and others, have sort of allowed the verbiage around this topic to get a little loosey goosey. What happened in the past was that some primes used money out of existing contracts to create excess capacity that then saved them money the next time they had to build new equipment. And our government, Congress and others got tired of that and wrote laws that limit how much money you can spend out of existing contracts to create excess capacity. And the way I understand the laws, most of them are zero. If we pay you to build 100 B-21s and you create a line that could do 120, you're going to jail or you're going to court. And so I think that there's some imprecise language running around and we need to give some of this time to sort out when the dust settles to understand what they're really asking of the primes, because they are limited on one side, fiducially and fiscally, and they're limited on the other side by laws and sometimes regulations that have been created by the regulatory agencies to correct past [behaviors].

I applaud the ideas and the initiative that the Secretary laid out. But to the defense of the primes, they're going to need some regulatory or legal relief to be able to do most of the things being talked about under the new plan. They just can't snap their fingers and say, OK, we're going to do this because then they'll end up in court.

Christian: It's not going to be an overnight process to reboot the Pentagon's procurement system. The Department of Defense is the largest single organization within the US Government. The amount of products and services that flow through that system is enormous. You've clearly laid out the tremendous opportunity that exists to rebuild the system. What are you most worried about? What's the biggest risk that can impede progress as the Pentagon starts this journey?

Lt. Gen. Groen: Tribalism. Tribalism will sink us. We are so horrifically tribal that we can't think like an extended entity. We can't think like a singular organism that is really effective through data and our systems flowing together. Tribalism kills that. And I see it every day. I'm not in the Pentagon every day anymore, but I see it: the tribalism among services, the tribalism among components of services and the tribalism within the department. And all of that tribalism is an afterglow of our industrial might in the 1960s. Now is the time for thinkers that are wearing a uniform, it's not about buying stuff without asking. It's about thinking through the flow that you want to achieve and then building the capabilities that you need to do that. It's a mindset thing, but that’s all about what transformation is. The form changes. And so when we transform, we transform ourselves into this place where we leave that tribalism behind because we have integrated effectiveness.

Working with broad autonomy is gonna help us think that way. I think that there's a broader awareness of what the technology is able to do and how it will facilitate. We just have to be careful to make sure that that's not the end state. Technology is not the end state. It's humans, war fighters who are winning on the battlefield because they understand and they can make the right calls. That's what we're after. And so all of the stuff about acquisition and the rules and why people don't follow the rules and why is it so tribal that we can't get anything to be, I think all of that merits some dynamite, but it also merits some thinking about how do we better integrate our thinking and flows and how do we do that on the battlefield?

Christian: How much of a risk is the next administration coming in and potentially changing everything? And then in particular, if you're one of those big primes, are you baking that into your long-term planning that this might shift in a measurable way in the future? Or do you think these changes are going to be something that is so overwhelmingly positive that future administrations have to stick with it?

Blank: Well, if you were asking me this three years ago, I would have said, well, you should get all this done now because it's going to be flipped back in three years. What's changed now is the amount of capital available for startups, scale-ups, and private equity firms that can match or overpower the lobbying efforts of the primes. So as I said, both the executive branch and Congress are coin operated, even more so now than ever. And for the first time ever, the insurgents have as much or more coin than the incumbents. That's what's going to change this game.

So yes, of course, a Democratic administration or another Republican one might have a different opinion. But in this case, we're talking about piles of money flooding the streets in Washington to try to change the game. Think about who are now sitting in the cabinet. And other places have commercial experience for the first time ever at scale, inside the executive branch for sure and inside the Department of War which changes the nature of the conversation and as we're seeing the types of things they're recommending.

Again, it wasn't that people didn't recognize this before. It was kind of hard to explain this to people who had never run a business or who have been career successful. I've said for years, we had world class organizations, world class people for a world that no longer existed. And finally, we have people who understand what that world should be like because they've been operating in it. Secretary Feinberg has been writing checks of tens of billions of dollars- buying an aircraft carrier, okay, he’s written those kinds of checks before. Tell me who else ever had that position.

And again, it's not that the DOW should run like a corporation or startup, but having that experience sets a bar for what you know is possible for doing extraordinary things. It's what this country knew how to do in World War II and during the Cold War, and we just kind of lost it when Robert McNamara, an ex-chief financial officer of Ford, put in the first version of the Planning, Programming, Budgeting and Execution System (PPBE) in 1962. We've been operating on that system for 63 years, or some variance of it. Basically, he imposed a chief financial officer's kind of strategy on budgeting and planning, which made sense at the time. It stopped making sense about 15 years ago, but no one inside the building knew what to do differently. That's changed.

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