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Defense Sector Outlook for 2017

By John Bedz | Automation Alley | 3/8/2017

Just a few months into the New Year, and a few weeks into a new administration, we are starting to hear questions about what to expect in the defense sector in 2017 and beyond. Each presidential administration makes changes to priorities and works with their new team to implement an updated strategy for the defense of the nation. These changes reflect the current state of the defense department and take into consideration the dynamic nature of this environment, while remaining cognizant of the long-term objectives that these changes must support. 

Secretary of Defense James Mattis has also outlined his top priorities: Improve the combat readiness of U.S. forces, strengthen international alliances, and ensure the Pentagon spends resources responsibly in order to “earn the trust of Congress and the American people.” These priorities align with the president who has said he will “end the defense sequester and submit a new budget to Congress outlining a plan to rebuild our military.”

Congress plays a role in this, too. Senator John McCain recently released a white paper, outlining reforms to the budgeting plans for defense and cited some specific needs within each branch of the military. His plan calls for a base budget of $640 billion and includes a total increase of $430 billion over five years.

Indications are that the government wants to end the Budget Control Act and develop budgets based on strategy, rather than strategize based on budgets. They also want to address gaps created in recent years. Some of these include: training, maintenance and sustainability, and meeting readiness levels that have been missed or are currently off schedule. One example is having a target number for ships and aircraft that is beyond the industrial base’s current capacity to manufacture. The administration, Congress and the DoD will work out a plan and set a course over the next few months. But here are some things that we, the industrial base, can consider in the interim. 

We hear leaders state that they want to work more effectively with industry, but that same industrial base sees the hurdles in the defense industry that are higher than in the private sector. Changing this will not, and in some cases, should not, be easy. There are some programs, however, that industry can consider as part of their growth plan. 

There are two Other Transaction Authority (OTA) projects servicing our regions defense interests. The first is the National Advanced Mobility Consortium. The NAMC seeks to accelerate the transition of innovative technology into transformative ground vehicles and systems. The second, newer OTA is called the Defense Automotive Technologies Consortium (DATC). The DATC objective is to collaboratively develop and transition engineering-based automotive technology solutions for manned and unmanned vehicles. Each of these efforts have features to reach non-traditional participants.

Here at Automation Alley, we operate the Diminishing Manufacturing Sources, Material Shortages (DMSMS) program for the U.S. Army. This effort has recently become open to other parts of the Department of Defense. It solves problems related to obsolescence and industrial base assurance. Some of these cases are finding existing suppliers when the DoD needs them, sometimes this work involves complex assessments of entire vehicle platforms. Listing your company is free.

If you’re interested in learning more about the sector to determine if it is the right fit for your company, consider meeting and mixing with those in the defense world.  

The 2017 TARDEC Industry Days, (April 25 and 26) will be hosted at Macomb County Community College in Warren. This annual event provides an overview of programs at TARDEC and gives industry partners, researchers and technology developers a chance to meet with subject matter experts from TARDEC and exchange ideas.

CO-located on the same campus is the Michigan Defense Exposition (MDEX) (April 26,27). This will feature the largest contingent of defense companies and programs assembled in Michigan in 2017.

Like with any customer, informing on what you offer, listening to what is needed and readying yourself to respond are key steps to success. We at Automation Alley are here to help you grow, whatever your sector.

To learn more about Automation Alley's defense programs, click here

John Bedz is a technology consultant with a nearly two decade history of working with disruptive technologies. His current focus is with Automation Alley and projects at the intersection of the entrepreneurial and defense sectors. He is also the project manager of the Michigan Automated Systems Collaborative (MASC), an initiative that Automation Alley manages for the Workforce Intelligence Network of Southeast Michigan. MASC helps companies in need of assistance that are both developing and integrating automated manufacturing systems. Bedz also has experience with startups, capital formation groups, federal, state and regional economic development organizations and with mature companies integrating new technologies and products.

Filed under: Defense, Military

Categories: Business Growth (60)

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