Speedy Design, Big Savings

During a visit to the National Robotics Engineering Center at Carnegie Mellon University on Friday, President Obama touted the promise of big savings to the national pocketbook from designing defense systems faster and for less money. Exhibit A, he said: Local Motors, a small Arizona company that under a DAPRA contract procured the Experimental Crowd-derived Combat Support Vehicle (XC2V), the first ever crowd-sourced, militarily relevant vehicle design. After checking out the vehicle prototype, which was in Pittsburgh, the president said:

We just took a look at it.  Not only could this change the way the government uses your tax dollars -- because think about it, instead of having a 10-year lead time to develop a piece of equipment with all kinds of changing specs and a moving target, if we were able to collapse the pace at which that manufacturing takes place, that could save taxpayers billions of dollars.  But it also could get products out to theater faster, which could save lives more quickly, and could then be used to transfer into the private sector more rapidly, which means we could get better products and services that we can sell and export around the world.  So it’s good for American companies.  It’s good for American jobs.  It’s good for taxpayers.  And it may save some lives in places like Afghanistan for our soldiers.

Through this program, DARPA looked beyond the traditional domestic defense industry for “innovative ideas for a vehicle body designed to accomplish the critical mission tasks of combat resupply and medical evacuation,” according to the agency. Local Motors was one of more than 150 bidders with designs deemed credible, and delivered its concept vehicle -- which includes a vehicle body and shell -- in less than 14 weeks.

Deputy Defense Secretary William Lynn, in remarks earlier in the day at the same event, said the design approach of the DARPA program could break the prevailing -- and unsustainable -- paradigm of military acquisition efforts, which have considerably less nimble development phases.

Before Eli Whitney had success in with the Cotton Gin, he went to Congress with a proposal to build muskets with interchangeable parts. It was 1801.  He was fairly dramatic in his presentation. Congress, then as now, is pretty skeptical of new ideas.  But Eli had a fairly dramatic way of demonstrating his. He took 10 muskets to Congress.  He disassembled them.  He threw all the parts in a pile.  And then he reassembled them, with different parts constituting each new musket-something that had never before been done. Congress was impressed.  Eventually, the Department of the Army issued a contract for 10,000 new muskets to be built using this method.  It was one of the first widespread uses standardized parts, and it contributed enormously to the advance of in manufacturing in the United States.

Fast-forward a couple hundred years to Norm Augustine, the former CEO of Lockheed Martin.  Norm wrote a book that is well known in defense circles called "Augustine's Laws." One of his laws was that he charted the increase in cost in high-performance jets and tactical aircraft against the increase in the defense budget.  When he plotted these two lines -- and it would not be that different now -- they crossed in 2054.  And what that meant was that in 2054 we would have to spend the entire defense budget to buy one airplane. He observed that that we could work this out.  The Navy would get it for three days a week, the Air Force for three says, and the Marines would have it on Sundays.

Obviously, this kind of rise in manufacturing costs is not sustainable.  But costs have continued to rise at roughly the rate Augustine predicted.  The cost increase in high-performance jets and other advanced equipment has been going up in a linear faction.  And part of the reason, a strong part of it, is the length of time it takes to design and approve them.  The time horizon of design and development is increasing at a similar pace. . . .

DARPA has focused on an advanced manufacturing effort that uses integrated circuits manufacturing as a model for open design and configurable foundries.  And that will lead you to the ability to crowd-source your design, greatly diversifying the sources of your design and the east with which it can be manufactured.  Altogether, we think this can significantly speed up the manufacturing timeline-on the order of dividing it by a factor of five.  That is to say we could do it five times as fast, which could yield enormous cost savings. . . .

This pilot [the XC2V] has the ability to undo Augustine's law and yield advances in manufacturing equivalent to what Eli Whitney ushered in during the early 19th century.  This is indeed the prize for us, for warfighters, and for taxpayers.