When a report has an opening like this, you know you have to find a way to get the author on Midrats.

As a nation, we are in an undeclared state of emergency.…This is a hot Cold War II. The West has empirically lost deterrence. We must respond to this emergency to regain it.
We have a peer adversary: China. “Near-Peer” is a shibboleth, a euphemism to avoid the embarrassment of acknowledging we have peers when we were once peerless.

That quote is from The Defense Reformation, written last October by Shyam Sankar the Chief Technology Officer for Palantir.

So many of the issues my cohost and I have been covering on Midrats the last decade and a half; personnel reform, Goldwater-Nichols, COCOM reform, the accretion encumbered acquisition program, and more are not just addressed in Sankar’s 18 Thesis, as I outlined in my Substack on it a few months ago, he provides solutions and new approaches.

Get a fresh cup of coffee, relax, and enjoy an impactful hour of conversation for those interested in reforming the US military towards a stronger, more responsive steward of our nation’s defense.

Summary

In this conversation, Sal, Mark, and Shyam Sankar discuss the need for innovation within the Department of Defense. They explore historical parallels, the importance of creativity, and the role a Silicon Valley mindset can have in national security. The discussion emphasizes the need for agility in budgeting, the impact of monopsony on procurement, and the significance of software in modern warfare. They also highlight the importance of founders and innovative thinking in driving change within the defense sector.

Takeaways

• The historical context of the Reformation can inform modern defense strategies.
• Creativity and innovation are essential for overcoming bureaucratic structures in defense.
• Silicon Valley's involvement in defense technology is crucial for national security.
• Lessons from the automotive industry can be applied to improve defense procurement.
• Founders play a vital role in driving innovation and change in organizations.
• People, processes, and policies must be aligned to optimize defense operations.
• Monopsony in defense procurement limits competition and innovation.
• Agility in budgeting is necessary to respond to changing defense needs.
• Stockpiles are less important than the ability to produce weapons quickly.
• Software is a key component in achieving asymmetric advantages in warfare.

Chapters

00:00: Introduction to Defense Reformation
03:21: Historical Context: The Reformation and Defense Reform
06:18: Creativity and Innovation in Defense
09:04: The Role of Silicon Valley in National Security
11:42: The Legacy of McNamara and Defense Management
14:30: Protecting Innovative Personalities in Defense
17:14: The Need for Modernization in Defense Policies
20:05: Monopsony in Defense Procurement
22:59: Encouraging Founders and Innovation in Defense
32:36: The Nature of Venture Capital and Innovation
33:08: Learning from Failure: The SpaceX Approach
34:21: Breaking Down Bureaucracy: The Need for Reinvention
36:24: Institutionalizing Rebellion: Encouraging Innovation
38:46: Leveraging Free Market Principles in Military Operations
41:06: The Role of Combatant Commanders in Defense Budgeting
43:09: Reassessing Cost-Plus Contracting in Defense
46:23: The Need for Agility in Budget Processes
49:11: The Importance of Production Over Stockpiles
52:58: Empowering Decision-Making in Military Leadership
57:41: Harnessing Software as a National Superpower