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6 Discussion Launching into a broader group discussion, workshop committee co-chair Ed Morris invited participants to reflect on what they had heard at the workshop and, applying their individual experiences, knowledge, and talent, share their ob- servations and suggestions for improvements. Several themes emerged from the ensuing discussion, including potential institute improvements, considerations related to sustaining the institutes, the relationship between Department of Defense (DoD) Manufacturing USA Institute activities and Broad Agency Announcements (BAAs), the need for a better understanding of each partnerâs needs, and the need for strategic planning. IMPROVING THE INSTITUTES Several participants underscored the urgency and importance of strengthen- ing the DoD Manufacturing USA institutes and advancing the initiativeâs goals. If the United States does not succeed in these efforts, one participant noted, another country will and the United States will be left behind. To this end, Michael Britt-Crane, Office of the Secretary of Defense Manu- facturing Technology (ManTech) Office, said it is clear that changes are needed to make the institutes stronger and to create more value for all stakeholders. In deter- mining the form and scope of these changes, it will be important to find common threads among the various stakeholders to foster a shared agenda, both in terms of 57
58 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D technology and workforce. In addition, Britt-Crane emphasized the need to better capture and communicate the benefits of the institutes to others outside the current partners in order to perpetuate the model into the future. Several participants suggested that conversations about the future of the in- stitutes should be widened to encompass more viewpoints. Mick Maher, Maher & Associates, LLC, noted that program executive officers (PEOs), program manage- ment offices, and other involved parties could offer valuable perspectives. Richard Fonda, Office of Naval Research, added that it is especially important to include military equipment manufacturers, who may not be able to afford to join an insti- tute but whose inclusion will help the overall defense manufacturing base move forward. John Christensen, DoD ManTech, encouraged the National Academies of Sciences, Engineering, and Medicine to create a public comment mechanism to solicit broader input beyond those present at the workshop. Mark LaViolette, Deloitte Consulting, suggested that including more compa- nies in the institutes in general would advance innovation and help create a tip- ping point for the United States to achieve broader overall adoption of advanced manufacturing. With more than 250,000 manufacturers in the United States, only 1,300 of which are currently institute members, there is much room for growth. Furthermore, the National Defense Strategy published in late 2017 pointed out that more national security innovations come from the commercial sector than from DoD-funded laboratories.1 For a nation at war, investing in innovation is a vital part of a strong defense. However, he cautioned against an overemphasis on defense, stressing the need for the institutes to pull in partners and talent from across a broad spectrum of commercial sector innovators. Bill Frazier, Naval Air Systems Command, added that institute members should include a mix of large and small organizations. Both LaViolette and Frazier suggested that fostering greater cohesion among the institutes, instead of each operating within their separate spheres, could help to strengthen the overall initiative. On the other hand, Robert Smith, Boeing, noted that it is important to keep in mind that the institutes are not identical; they may face different challenges and require different solutions based on their areas of focus. Malcolm Thompson, NextFlex, reiterated that institute members must be cre- ative, innovative, and adaptable to ensure that the institutes remain productive and maintain the United Statesâ edge over other countries. The U.S. innovation ecosys- tem offers unique advantagesâfor example, NextFlex is barely 5 years old and has a much smaller budget than Fraunhofer but nevertheless frequently outcompetes Fraunhofer. It is important to leverage and continue to build on the advantages of this ecosystem. 1 Executive Office of the President, 2017, National Security Strategy of the United States of America, https://www.whitehouse.gov/wp-content/uploads/2017/12/NSS-Final-12-18-2017-0905-2.pdf.
Discussion 59 Byron Clayton, Advanced Robotics Manufacturing Institute (ARM), suggested that the institutes should place more emphasis on technology readiness levels (TRLs) and increasing actual products to sell, either to DoD or commercially. He also suggested that DoD and the institutes could increase TRLs and manufactur- ing readiness levels (MRLs) in order to create a more complete innovation pipeline from basic research to new technology implementation. Such a pipeline would reduce the inherent risks from incorporating new technology into manufacturing, accelerating development and delivery of impactful products. On the other hand, Morris noted that increasing TRLs and MRLs is a challenging task that requires money and time, so it is important to focus on the overall context and purpose: Is the institutesâ purpose to advance TRLs, to deliver capabilities to the warfighter, or both? Christensen added that any changes made to the institutes will have eco- nomic ramifications that must be considered. Noting the importance of raw materials, Jitan Shah, Product Development & Analysis, suggested that DoD study and find alternatives for raw materials not under U.S. control, perhaps even opening a new institute focused on mining and raw materials. SUSTAINING THE INSTITUTES As DoD and institute stakeholders look toward the future, many participants emphasized the need for mechanisms to sustain the work of the institutes, in terms of funding as well as technology innovation and workforce development. Michael Liehr, American Institute for Manufacturing of Integrated Photonics (AIM Photonics), stressed that continued institute success depends on continued DoD investment, whether directly from DoD or from other identified sources. Leo Grassilli, Office of the Secretary of Defense, noted that DoDâs Office of the Secretary of Defense is not likely able to provide the level of funding that all stakeholders would want it to and urged taking a broader approach to seeking funding, such as by looking to PEOs as well as other government offices. Rob Gorham, America Makes, noted that institute sustainment goes beyond funding and requires change agents to build a community, lead progress, and re- main valuable to DoD. Emphasizing the institutesâ structure as publicâprivate part- nerships among government, industry, and academia, Nigel Francis, Lightweight Innovations for Tomorrow (LIFT), posited that the DoD has an important role to play in helping the work of the institutes grow from subcritical, early-phase con- tributions to supercritical innovations with proven value. Once that superÂ ritical c state is achieved, he said, the institutes will be compelling and relevant to both DoD and industry and demand for their work will increase. But first, the institutes must present their successes and their compelling reasons for continued funding, such as a compelling return on investment (ROI) or a high warfighting impact. For
60 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D example, LIFT ingenuity minimized fatal Humvee rollovers, saving countless lives. Another LIFT initiative saved DoD $1 billion and cost only $3 million. Greg Henschel, Department of Education, noted that workforce is critical to the future of the institutes as well as U.S. manufacturing more broadly. Institute leaders could partner with federal, state, and local governments as well as com- munity colleges, universities, and public schools to create career pathways that prepare students for high-paying technical jobs, perhaps even allowing them to train in their well-equipped facilities. Taking on this mission could increase the institutesâ profile and garner more support, Henschel posited, in addition to filling a crucial national need. BROAD AGENCY ANNOUNCEMENTS Challenges related to the contracting process were a recurring theme through- out the workshop. These challenges affect both the institutes and the overall manu- facturing landscape. One aspect of these challenges is BAAs, which offer a separate channel for companies to serve DoD and other agencies that in some ways com- petes with the model of the Manufacturing USA institutes. Participants expressed a range of opinions about the relationship between BAAs and the institutes and the relative advantages of each. Smith posited that institutes support better workforce, industry, and academic engagement than BAAs. Arnie Kravitz, ARM, added that another shortcoming of BAAs is that they typically create products but do not create manufacturing pro- cesses that make weapons production economically feasible. Another participant noted that BAA contracting is a lengthy process and suggested that a more nimble model that makes it possible to move a defense project from problem statement to contract award in 60 days, for example, would be better positioned to truly support readiness. While competition is necessary and there is a reason for the systems and structures that are in place, it is also important to change thinking in order to support greater agility and speed innovation, the participant stressed. Liehr said that institute directors often find themselves in the difficult posi- tion of competing against for-profit commercial entities in BAAs. Morris added that such situations can cause institutes to lose membership when member-driven institutes are forced to compete with their own members. On the other hand, some participants see value in the tension between institutes and BAAs. Grassilli stated that instead of eliminating BAAs in areas that compete with institute work, com- petition can improve the institutesâ work and DoD ROIs. Maher noted that other DoD stakeholders agreed with this sentiment.
Discussion 61 The DoD Perspective Grassilli stressed the need for the institutes to better understand the DoD and its focus on warfighting and preparation. Institute members can best help DoD meet its goals by making it easy for DoD to use what they produce. DoD incorpo- rates new systems on an observe-orient-decide-act loop, and companies that can get inside that loop will be most successful, he said. While it is useful to learn from international program models, Christensen pointed out that most programs in other countries are not driven by defense agency partnerships like the institutes are. Because the institutesâ stated mission is to support warfighting, the defense impact should be at the forefront of institute work; it is not fair to expect DoD to continue to provide support unless its goals are met, he continued, even if the institutesâ work benefits the wider manufacturing ecosystem. Clayton added that the institutes could improve their value to DoD by better understanding DoDâs supply chain challenges, its needs and priorities, the key project contacts, and all the funding platforms. While defense technologies themselves are important, Kravitz emphasized the value of improving manufacturing processes in ways that make a true difference for DoD and warfighters. For example, Liberty ships helped win World War II not because they were technologically advanced, but because the United States was able to manufacture them more quickly than the enemy could sink them. While Manufacturing USA does not make products, it delivers value by making processes that enable the manufacturing of equipment and machines that DoD will use to win future wars, he said. The Need for Strategy Several participants asserted that the institutes are hindered by the lack of an overarching strategy for themselves or domestic manufacturing more broadly. Smith stated that while Boeing works successfully with the institutes, in his view the lack of a clear pathway to advance U.S. manufacturing is a weakness, and in- stitute stakeholders, such as DoD or PEOs, should create one. Morris noted that while roadmaps are difficult and expensive to create, they are essential. Thompson underscored the need for strategic roadmapping, identifying gaps, and determining DoDâs critical technology needs. Christensen added that it is important to deter- mine if the institutes are truly serving the right purpose, without being blinded by emotional attachment to them. Susan Helper, Case Western Reserve University, noted that the current lack of strategy creates competing visions for how the institutes should meet their goals. Should DoD, which is providing much of the funding, dictate what the institutes
62 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D do, or is a stronger U.S. manufacturing ecosystem, not strictly tied to defense goals, a worthy end unto itself? She reiterated that international models do not have a military emphasis, focusing instead on improving manufacturing, training, and employment opportunities. Building on this point, Chris Peters, Lucrum Group, urged that a roadmap should include a national push for the adoption of institute technologies into the wider economy. With its âIndustry 4.0â program, Germany created a consis- tent message and a roadmap for companies that increased technology adoption throughout industry. The United States could benefit from a similarly consistent, unified vision, he said. Korea drove technology adoption through an innovative program where the government handpicks manufacturers in different industries, updates their facilities, and uses them as âcase studiesâ for other companies, who are encouraged to adopt the updates. Initiatives like these can break past competitive instincts, encourage information and technology sharing, and create industry-wide improvements, Peters said. Another participant pointed out that strategy is often driven by financing. A focus on fast ROIs and venture capital can skew investments away from manufac- turing in favor of areas such as software development, for example. As a result, if the United States wants to get manufacturing on a more steady and permanent footing, the participant suggested that it will be necessary to address the motivations and drivers in the financial sector. FUTURE STUDY IDEAS Over the 2 days of the workshop, participants introduced many ideas that extended beyond the scope of the current National Academiesâ study. As the work- shop drew to a close, participants were invited to share their ideas, in person or in writing, for future National Academiesâ studies that would further inform decisions around the DoD Manufacturing USA institutes, their relationship with national defense and DoD, and the U.S. manufacturing sector more broadly. These ideas fell into several broad categories, including education and work- force development (EWD), impacts of the institutes, funding structures, engage- ment, process improvements, DoD needs, and other areas. Education and Workforce Development Several participants stressed the importance of EWD and suggested several areas for further study. â¢ Cathy Borgesen, Massachusetts Institute of Technology (MIT), suggested a broad study compiling effective components of successful EWD programs.
Discussion 63 â¢ Another participant suggested a consensus study specifically to influence, encourage, and instruct small and medium-size enterprises (SMEs) on how and why they must actively support EWD. â¢ Carla Langjahr, Defense Logistics Agency, recommended a study to create compelling EWD programs for the institutes that are cost-effective and improve sustainability. â¢ Philip Lippel, MIT, proposed a study to determine how DoD can support more EWD, both within institutes and institute-wide, which could priori- tize EWD as one of the institutesâ core functions. â¢ Emily DeRocco, LIFT, proposed a study of how a well-trained workforce strengthens the overall defense industry base, which is critical to DoDâs mission and the institutesâ performance. â¢ Another participant suggested an EWD study to focus on advanced manu- facturing engineering, technical education, and training needs, especially as compared to the current education system. â¢ Another participant zeroed in on the role of talent within the âinnovation pipelineâ and noted that in a free trade environment with global innovation diffusion, a bachelorâs degree in engineering could be an advantage. â¢ Martin Kinsella, LIFT, suggested a National Academiesâ study on EWD with a specific focus on the potential impacts from a lack of future talent. Impacts of the Institutes Several participants suggested studies aimed at evaluating the impacts of the DoD Manufacturing USA institutes. Some emphasized that the most compelling evidence would be quantitative analyses of institute impacts, while others noted the importance and power of qualitative success stories. â¢ Langjahr recommended a study to define and demonstrate the institutesâ value, detailing money and lives saved, increased readiness, and improved national security, and complementing acting Secretary of Defense Shana- hanâs three priorities (increased lethality, partnerships, and a reform culture, as stated in the first keynote address). â¢ Kinsella also proposed a study to clearly demonstrate institute successes. â¢ Another participant suggested a consensus study to determine the assets the institutes have provided to DoD. Kevin McComber, AIM Photonics, noted that such a study would provide quantitative justification for future investments (or lack of investment) in the institutes. â¢ Megan Brewster, Launch Forth, and another participant suggested a study to determine the quantitative impact of institutes on the overall economy and national security, to be presented to congressional appropriators as
64 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D an apolitical, objective justification for the program and its congressional funding levels. â¢ Abhai Kumar, DoD, suggested a study to calculate the institutesâ value propositions, with both objective ROI and subjective savings or cost offsets. â¢ Nick Usechak, Air Force Research Laboratory (AFRL)-AIM, suggested a study collecting success stories from companies and DoD that create a compelling narrative of institute benefits. â¢ Kravitz recommended that a consensus study should attempt to quantify the institutesâ achievement and economic impact, for example of disruptive products developed through new manufacturing processes, equipment, or materials that were themselves developed by the institutes and are now integral to the commercial and military sectorâso-called needle movers. â¢ Thompson suggested a National Academiesâ report that would assess the ROI of each institute, as measured by their impact on DoD programs, the commercial economy, and EWD, to justify continued funding. â¢ Another participant suggested a follow-on study to identify metrics across the institutes to enable crucial decision making, as the existing metrics are not informative enough. â¢ DeRocco suggested a study to determine the role and contribution of the institutes as both national and regional economic development assets, which would increase political support. Funding Structure Changes Several participants sought more information that could lead to changes in how the institutes are funded. They also suggested other models to mine for useful ideas. â¢ Smith proposed a study to determine the best institute funding methods that will accelerate innovation. â¢ Michael McGrath, McGrath Analytics, suggested a follow-on study to deterÂ mine if the institutes should follow the Fraunhofer funding model. â¢ Suresh Sitaraman, Georgia Institute of Technology, recommended a study examining an appropriate membership cost-share model for universities and academic partners to participate, considering their nonprofit status. â¢ Another participant suggested a study to find an equitable funding model for the institutes that does not rely exclusively on DoD, as DoD is not likely to continue being the sole federal funder. â¢ Francis suggested two other models for the National Academies to study in more detail: Catapultâs Manufacturing Technology Centre (MTC) and Â oegepast Natuurwetenschappelijk Onderzoek, the Dutch independent T
Discussion 65 applied research organization. The MTC in particular was successful in creating a full manufacturing setup under one roof and leveraging its re- sources and industry relationships to acquire committed funding. Studying these two models could help the United States determine its own potential benchmarks. â¢ Julie Chen, University of Massachusetts, Lowell, suggested a study of the best balance of public and for-profit use as well as a potential distributed- network model. The Importance of Engagement The institutes are intensely collaborative operations, and several participants suggested more ideas for improved engagement with the larger research and develÂ opment (R&D) ecosystem. â¢ Smith proposed a study to determine better approaches, such as the National Â Shipbuilding Research Program, for DoD to engage with industry and aca- demia and improve adoption of institute offerings. â¢ Kym Wehrle, UI LABS-DMDII, suggested a report that examines how to effectively engage SMEs, who make up 90 percent of the supply chain but have limited resources for making improvements to better meet DoD and commercial needs. â¢ Another participant suggested a study to determine which incentives would encourage small businesses to engage more with the institutes. â¢ Another participant suggested a National Academiesâ study on how to collaborate with friendly international institutes and how to create incen- tive programs for early adopters (commercial and defense) to engage with emerging technologies. â¢ Lippel recommended a study on how DoD uses the institutes in contrast to how it engages with university-affiliated or federally funded R&D centers. â¢ Mark Poliks, Binghamton University, noted the important role many public universities play in supporting or leading statesâ economic development as key institute partners. â¢ Elizabeth Henry, DoD AFRL, proposed a study to determine how the insti- tutes can better engage with military services to enhance the manufacturing technology investment and transition ecosystem. â¢ Chen suggested that the National Academies study university research structures that could move TRLs beyond current levels. Both industry and government have reduced their R&D, and universities can provide expertise and talent if DoD engages with them appropriately.
66 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D Process Improvements Several participants suggested studies related to potential improvements in institute processes. â¢ Smith proposed a study to determine how to create faster, more flexible contracting methods to move adoption of institute offeringsâfor example, Other Transaction Authorities, Military Interdepartmental Purchase Re- quests, or BAAs within institutes. â¢ Kevin McComber, AIM Photonics, suggested assessing each instituteâs ca- pabilities to determine what should be built internally and what should be outsourced. â¢ Another participant suggested a study to determine whether the institutes should reorganize under a central government organization, potentially consolidating support requests. â¢ Abhai Kumar, DoD, suggested a study to identify improvements to the execution speed of institute project calls, evaluations, selections, and contracting. â¢ Lippel proposed a study to determine how, at a current TRL of 3-7, DoD and the institutes can improve the transition from ideas to in-hand technology. â¢ Henry suggested a study detailing how to better manage institute delivery of offerings to DoD and the commercial sector. â¢ Gorham suggested a study to identify changes to MEP that would lead to improved scale and diffusion. â¢ Chen recommended examining models that encourage sharing institute fÂ cilities, equipment, and EWD platforms to improve efficiency and in- a crease national capabilities, with a bonus of improved sustainability. Past models include nanotechnology and supercomputing facilities, and such an activity could verify that those are being appropriately utilized. â¢ Helper suggested a study of the overall DoD-manufacturing feedback loop to provide more information. â¢ Another participant suggested a study to identify a dynamic process to determine what technology areas need new institutes and which federal agency should pursue their creation. â¢ Another participant proposed a study determining if closing one or two institutes would strengthen the case for supporting the remaining institutes and the overall program. â¢ Another participant suggested a study to examine the effectiveness of each instituteâs governance models and whether they are in need of realignment. â¢ Lippel suggested that devising an institute ratings system could be helpful to better address new technology needs.
Discussion 67 Ways to Better Meet DoD Needs Several studies were proposed to identify how the institutes can meet the needs of the DoD. â¢ A participant proposed a study to determine the best way to connect DoD electronics manufacturing needs with institute members. â¢ Brewster suggested a study of the pathway for DoD procurement of Âinstitute-developed technologies, whose audience would be DoD and other military appropriators. â¢ Clayton recommended a National Academiesâ study to create a DoD-Â specific supply chain map that identifies and prioritizes opportunities, needs, and challenges, and also includes relevant funding mechanisms and key contracts. â¢ Clayton proposed a study to devise ways to increase awareness of the insti- tutes within DoDâs supply chain and incentivize those partnerships. â¢ Henry proposed a study to determine how to identify, prioritize, and com- municate DoDâs critical needs and challenges for each instituteâs technology area. â¢ A participant suggested a deep dive into what manufacturing innovation is needed, applying tangible facts and data and sidestepping anecdotal evi- dence, with an honest accounting of successes and failures. â¢ Another participant suggested a study exploring methods for the institutes to better meet warfighter needs, including improving input for roadmaps, project calls, prototyping, and future DoD programs. â¢ Another participant suggested a report that consolidates this workshopâs message and a convening of DoD executive agents, who would have valu- able feedback or counter-arguments. â¢ Another participant suggested a study of the relationship between manu- facturing for DoD needs and for civilian needs. The participant noted that these areas are more interconnected in the United States than in other countries, and as a result changes in this area could affect the United Statesâ global standing. â¢ Ben Wang, Georgia Institute of Technology, suggested a study to identify the best metrics to assess institutesâ progress and alignment with DoDâs strategic goals. â¢ McComber suggested a âGrand Challengeâ for the DoD that requires cross- institute coordination.
68 S t r at e g i c L o n g - T e r m Pa r t i c i pat i o n b y D o D Broader Challenges Several participants sought to widen the lens and proposed studies that could tackle broader challenges, such as supply chain issues, IP issues, and improvements to the overall manufacturing landscape. A participant suggested a broad study of the challenges to innovation in man- ufacturing, analogous to the 2007 consensus study Rising Above the Gathering Storm.2 This new study should rely on data and facts, not passionate narratives, be honest about challenges and failures, and help determine if there is a problem larger than the institutes, he noted. â¢ Wang suggested that the institutes should be used to address two current Grand Challenges: how to accelerate innovation and commercialization and how to invent and build everything domestically. â¢ Poliks suggested that a study on the viability of U.S. electronics manufactur- ing capabilities is necessary because of the continued decline of domestic supplies and a domestic supply chain, which impacts national security. â¢ Another participant recommended a study to determine which IP regimes promote growth and equity in different industries. â¢ A participant suggested examining how a lack of strong IP protections leads to wealth transfers out of the United States. â¢ Another participant proposed a study to identify which design and manu- facturing approaches can achieve cost parity for different technologies. For example, there may be other reasons, beyond costs, that make offshore supply chains more appealing than domestic supply chains. â¢ Pradeep Lall, Auburn University, suggested a study to determine how to influence the cost equations that allow competition with low cost designa- tions. A better understanding would make it more profitable for private enterprises to increase their use of onshore manufacturing. â¢ Peter Goetz, Naval Research Laboratory and AIM Photonics, noted that the Netherlands recently outspent the United States, and possibly China, on studying integrated photonics. â¢ A participant suggested a study to review the federal contracting pro- cess, which is problematic for the institutes and the overall manufacturing landscape. â¢ Gorham suggested a study to better integrate advanced manufacturing technologies on a large scale (an âx-planeâ). 2 National Academy of Sciences, National Academy of Engineering, and Institute of Medicine, 2007, Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future, The National Academies Press, Washington, D.C., https://doi.org/10.17226/11463.
Discussion 69 â¢ Scott Miller, NextFlex, proposed a study of the options, benefits, costs, and potential economic and national security outcomes of an overall federal restructuring of advanced manufacturing R&D investments. The current approach lacks an efficient, effective, competitive national strategy, and a National Academiesâ study should present an objective assessment of dif- ferent funding mechanisms, he said. â¢ McGrath suggested a study to determine if DoD should reinstate older pro- grams, beyond the institutes, to strengthen the industrial base and national security.