An Assessment of the SBIR Program at the Department of Defense (2009) / Chapter Skim
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Pages 158-186
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From page 159... ...
It has also been suggested that there might be a disconnect between researchoriented firms and commercially-oriented firms, and that SBIR programs should be adjusted to focus more effectively on the latter. This is – partly – the purpose of including the CAI in SBIR proposal reviews.
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From page 160... ...
Two-thirds of the respondents in this sample report some specific marketing activities related to the project. 4.5.2 Scientific publications Publications fill two important roles in the study of SBIR programs.
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From page 163... ...
Responses to Question 32, shown in Figure 4-19 address any relationships between the respondent's firm on the Phase II project being surveyed the same 837 respondents who answered question 31, not just those who answered "yes." UNEDITED PROOFS
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From page 166... ...
A few of the SBIR programs have directly resulted into commercial products but most have led to product improvements. The firm's commercialization strategy emerged from and has been greatly enhanced through its participation in SBIRs.
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From page 167... ...
After its sale in 2001, following the retirement of its founder, Thermacore became ineligible for SBIR awards because it was a wholly owned subsidiary of a larger company. It does however continue to do some SBIR-funded research as a subcontractor to small firms conducting Phase I and II research.
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From page 168... ...
They also contain limited data on the gestation processes connecting SBIR awards and commercial outcomes. The review of outcomes described in this chapter provides an overview of an effective program, meeting a wide variety of program goals.
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From page 169... ...
The SBIR program is helping DoD to meet the new and often sudden challenges of a turbulent world.
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From page 170... ...
Small businesses are critically important to technology development at DoD. According to Michael Cacciutto, DoD SBIR program administrator, after assessing 255 industrial capabilities, DoD concluded that 36 percent of the companies with relevant products have less than 100 employees.1 "Phase III" is not funded by any line item.
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From page 171... ...
During the 1990s, following the renewal of the program, growing pressure from Congress, and changes in priorities of the leadership in the Pentagon, gradually shifted the SBIR program's emphasis toward serving the warfighter more directly, and specifically to the issue of Phase III. 5.1.1 Congress Over the past fifteen years, Congress has repeatedly directed SBIR programs generally, and DoD in particular, to emphasize commercialization and to promote the use of SBIR-sponsored technologies in acquisition programs.
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From page 172... ...
As a result, DD350 data tends to undercount the real number of SBIR-related RDT&E contracts. Nonetheless, the DD350 data do show that the amount of Phase III contracts generated have been climbing steadily in recent years, particularly at the Navy,: Millions of Dollars FIGURE 5-1 Phase III awards total $M, 1999-2005.
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From page 173... ...
Phase III funds that go to the firm indirectly via prime contractors, or funding that is not marked as Phase III on DD 350 are not included For DoD as a whole, Michael Cacciutto, DoD SBIR program administrator, also noted that the amount of commercialization generated from SBIR projects leads the total amount spent on SBIR, with about a 4 year lag: UNEDITED PROOFS
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From page 174... ...
SOURCE: Michael Caccuitto, DoD SBIR Program Manager, Presentation to SBTC SBIR in Rapid Transition Conference, Sept. 27 2006, Washington DC.
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From page 175... ...
The DoD data in Figure 5-4 indicate the distribution of Phase III sales by sector and show that while there is a strong focus on DoD and the prime contractors is unsurprising, more commercial activity occurs with the private sector outside DoD. As shown in Figure 5-5, only 44 percent of Phase III contracts can be attributed to DoD and DoD primes.
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From page 176... ...
• Faster Development Time: Products and services from SBIR can often be developed within a relatively short time frame. In the view of John Williams, Navy SBIR Program Manager, the notion that it takes 5 to 10 years to commercialize most technologies – and that Phase III results could take 5 to 10 years - is a myth.
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From page 177... ...
Nonetheless, there are substantial barriers that impede Phase II projects from successfully transitioning into Phase III . To begin with, acquisitions officers have traditionally viewed SBIR more as a tax on their other research projects than an opportunity.
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From page 179... ...
C2.9.1.5: "The Program Manager shall develop an acquisition strategy that plans for the use of technologies developed under the SBIR program, and gives favorable consideration for funding of successful SBIR technologies. At milestone and appropriate program reviews for ACAT I programs, the PM shall address the program's plans for funding the further development and insertion into the program of SBIR-developed technologies."11 Comments made by all the stakeholders at the NRC Phase III Symposium, and in discussions with case study companies and DoD officers, all underline the problems and difficulties faced by companies in making the Phase III transition.
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From page 180... ...
Examples UNEDITED PROOFS
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From page 181... ...
Source: Defense Acquisitions Handbook, 10.5.2. Technology Maturity and Technology Readiness Assessments The "gap" between TRL 3-5 and TRL 6 can be characterized as the "TRL Gap," and it is a critical element in the difficulties experienced in transitioning Phase II technologies through Phase III into the mainstream acquisition process.
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From page 182... ...
• Phase III Funding beyond DoD. Few small firms have the staff or resources to do the market analysis necessary to attract funding from venture capitalists, which are not, in any case, attracted to government contracting opportunities for a variety of reasons such as the expected limited market size, long lead times, and the level of regulatory "red tape" encountered in the procurement process.
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From page 183... ...
, and has been a subcontractor on other projects.18 17 For example, Orbitec's $57 million NASA Phase III contract was reduced by more than 80 percent after its first year. 18 Lani Loell, SBIR Program Manager, Raytheon Integrated Defense Systems, Presentation to SBTC SBIR in Transition Conference, September 27, 2006, Washington, D.C.
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From page 184... ...
A number of points regarding the relationship of prime contractors to SBIR projects were expressed at the NRC Phase III Symposium. These included: • Increased interest in SBIR.
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From page 185... ...
Speakers from the prime contractors also noted that venture capitalists were unwilling to step into the Phase III funding gap partly because government contracts might not be large enough to ensure commercial viability, and partly because the longer time horizons and significant uncertainty involved in government contacting did not fit with the relatively short time horizon and private market focus of venture capital firms. • Misalignment between agencies, primes, and small business.
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From page 186... ...
Sources: presentations by Mr. Rich Hendel, Boeing SBIR Program Manager.
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