Return-Path: <sentto-279987-5213-1029763425-fc=all.net@returns.groups.yahoo.com> Delivered-To: fc@all.net Received: from 204.181.12.215 [204.181.12.215] by localhost with POP3 (fetchmail-5.7.4) for fc@localhost (single-drop); Mon, 19 Aug 2002 06:26:10 -0700 (PDT) Received: (qmail 23250 invoked by uid 510); 19 Aug 2002 13:22:09 -0000 Received: from n5.grp.scd.yahoo.com (66.218.66.89) by all.net with SMTP; 19 Aug 2002 13:22:09 -0000 X-eGroups-Return: sentto-279987-5213-1029763425-fc=all.net@returns.groups.yahoo.com Received: from [66.218.67.192] by n5.grp.scd.yahoo.com with NNFMP; 19 Aug 2002 13:23:45 -0000 X-Sender: fc@red.all.net X-Apparently-To: iwar@onelist.com Received: (EGP: mail-8_0_7_4); 19 Aug 2002 13:23:45 -0000 Received: (qmail 92196 invoked from network); 19 Aug 2002 13:23:44 -0000 Received: from unknown (66.218.66.218) by m10.grp.scd.yahoo.com with QMQP; 19 Aug 2002 13:23:44 -0000 Received: from unknown (HELO red.all.net) (12.232.72.152) by mta3.grp.scd.yahoo.com with SMTP; 19 Aug 2002 13:23:43 -0000 Received: (from fc@localhost) by red.all.net (8.11.2/8.11.2) id g7JDOsN08280 for iwar@onelist.com; Mon, 19 Aug 2002 06:24:54 -0700 Message-Id: <200208191324.g7JDOsN08280@red.all.net> To: iwar@onelist.com (Information Warfare Mailing List) Organization: I'm not allowed to say X-Mailer: don't even ask X-Mailer: ELM [version 2.5 PL3] From: Fred Cohen <fc@all.net> X-Yahoo-Profile: fcallnet Mailing-List: list iwar@yahoogroups.com; contact iwar-owner@yahoogroups.com Delivered-To: mailing list iwar@yahoogroups.com Precedence: bulk List-Unsubscribe: <mailto:iwar-unsubscribe@yahoogroups.com> Date: Mon, 19 Aug 2002 06:24:54 -0700 (PDT) Subject: [iwar] [fc:Navy.Leader.Says.Contractors.Must.Change.Their.Ways] Reply-To: iwar@yahoogroups.com Content-Type: text/plain; charset=US-ASCII Content-Transfer-Encoding: 7bit X-Spam-Status: No, hits=0.0 required=5.0 tests=DIFFERENT_REPLY_TO version=2.20 X-Spam-Level: Navy News & Undersea Technology August 19, 2002 Navy Leader Says Contractors Must Change Their Ways By Dave Ahearn Defense contractors are irritating one of their best customers, the United States Navy, and that must change, now. Defense contractors are driving for maximum profits by producing unique systems that don't work well with systems produced by their competitors, and that's causing major problems for a U.S. Navy bent on creating a network-centric warfighting capability, a senior Navy leader told contractors last week. That means a new paradigm must emerge, in which defense contractors work more cooperatively with the Navy, and each other. The gently worded rebuke came from Paul Schneider, principal deputy assistant secretary of the Navy for research, development and acquisition, as he addressed an amphitheater filled with hundreds of representatives of pre-eminent American defense contractors. They were attending the Office of Naval Research naval-industry research and development partnership conference in Washington, and Schneider was the lead speaker at the two-day symposium. Schneider said he understands that corporations exist to make profits, and those who lead and work in those firms must keep that in mind. "The industry that you represent holds you responsible and accountable for profit and loss," Schneider said. "You have to provide return to shareholders," and it's true that corporations exist in a world where "some of the competition is absolutely cutthroat." All well and good. Profits And Problems But "sometimes that competitiveness, frankly, ends up causing us some difficulties in how we" attempt to integrate systems to form a seamless network-centric capability. And that's why "we're going to have to figure out how to do business a little differently," Schneider said. "What we want to do is take advantage of all the great technology advances in sensors, in weapons," and other areas, "but to do it in a manner that when we get it" from contractors, "it really is, almost, plug and play, and fully interoperable" with other systems made by other contractors. In a full and frank expression of his views, Schneider warned the defense industry that the good old days and familiar ways are over. Companies are going to have to change, if they wish to continue selling products to one of the biggest-spending customers in the world, the Navy. Schneider noted that historically, when the Navy ordered a weapon or platform or system, a contractor might design it whichever way the contractor chose, and it would be interoperable at best with other defense wares the contractor produced. That, of course, would be a great proprietary plus for the contractor, and an incentive for the Navy to order more items from that company. And the Navy itself was part of the problem. "You have all these different constituencies" in the defense procurement arena, he said. "That means all of you" contractors, and "that means all of us [in the Pentagon] that play in this business." Whereas in the past, each Pentagon program manager ordered a custom item, Schneider again told the crowd of contractor personnel "we can't do business like that any more. That's just not going to work." Today, the Navy must have all of its systems working together, and to work jointly with systems of other services. Electronic systems must interface smoothly. "I want the networks and the protocols basically off the table" as a problem issue, "so we can get competition that really matters, which is the sensors, the weapons," he said. In other words, the Navy should buy whichever weapon or sensor works best, and not make an acquisition based on what sensor or weapon will work with some other system already on ships or in aircraft. A Balkanized collection of completely different, and differing, weapons and sensors and systems that can't work together just won't cut it in the current world, he said. That uncommunicative collection of products won't square with Schneider's vision of fully linked battle space forces. The Navy must be able to "take imagery from [a source identifying a target], download it to a carrier, uplink it to an F-18" strike fighter plane, and have it "drop the precision-guided munitions," all without a glitch or a hitch. "And so what you have to do is figure out how to make all of this stuff come together," he said. This involves technical issues of the architecture of electronic systems, and whether they have the same file format and programming protocols and rules on how to exchange information, he said. "It sounds simple," but it's "very, very hard," he said. "This is very complex, and it has significant business considerations." Change, Or Else But, ever so gently, Schneider told the contractors that if they wish to continue selling goods to the Department of Defense, they must change their ways. "We want the competition, and the innovation, and the technology-investments that industry makes-to be beneficial," and lead to profits for corporate stockholders. "We don't want you to invest your dollars on things that, frankly, we want to take off the table" because they can't work with other systems. "We want a greater return on your investment for you, and a greater return on your investment for us," in the form of network-centric capabilities, he said. The Navy is seeking to determine, as it orders new weapons and platforms and systems, "how do we incorporate these new technologies, regardless of source? ... How do we integrate these networks and sensors and weapons?" To underscore that this isn't just some routine series of comments, but rather something that contractors must take seriously, Schneider said: "This is a big deal. It's going to take a lot of smart minds to figure out how to merge different architectures." Expressing frustration at what the Navy has bought and the defense industry has supplied, he said that the Navy currently is "stuck with a lot of legacy systems," and it's tough to integrate them with each other, or to buy new systems that integrate smoothly with the old. "Any time you want to incorporate a new capability, it's almost cost-prohibitive," Schneider said, adding again: "We can't do business like that in the future." Intellectual Property Another thorny problem lies in the issue of intellectual property, such as patent rights and the right to exclusive sales of products to the private market that employ technology developed for the Navy and other services, Schneider said. This can be such a major thorn in the side that it can, and has, blocked the Navy from hiring corporations to produce weapons or other systems, he said. "I personally, over the past two years, have had some tough situations where we were unable to, unfortunately, figure a way to work [out] business management with a couple of companies," he said. Officers of those firms thought that terms of agreements proposed by the Navy would have harmed the companies. Those corporate officers thought the Navy wording "would have been a failed protection of some creative technology that they had, that had great commercial potential. That's unfortunate. And yet I fully understand and appreciate the positions that they had." This kind of deal-breaking dispute can't be allowed to become common, Schneider said. "We're going to have to work through this, because it's kind of key to how we do business in the future," if more defense contracts are to get signed. The Department of Defense and the defense industry must come to terms, and "figure a way to work [out] ... a business arrangement," he said. Where there is "innovation with great commercial potential that we can use in military applications, we ought to be able to figure out the business relationship and the protection of rights that makes sense, and that's fair," he told the contractors. "And we ought to get the right folks" from both the Pentagon and defense corporations "working on that." Tough Times After the tough-love speech, Schneider said he sympathizes with the defense industry. "I think the business environment that we're all operating in is severe," he said. For example, he said as he flew in to attend the air show at Farnborough, England, last month, it covered just about two-thirds the space that it had two yeas ago, and the displays in exhibit halls shrank that much or more. That's a reflection of the business environment, "and a lot of consolidation" in the defense industry, he said. "It really is a severe business environment." ------------------------ Yahoo! Groups Sponsor ---------------------~--> 4 DVDs Free +s&p Join Now http://us.click.yahoo.com/pt6YBB/NXiEAA/Ey.GAA/kgFolB/TM ---------------------------------------------------------------------~-> ------------------ http://all.net/ Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
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