Observations of a Dual-use Road Warrior

Jim Fallon M/A-Com Inc., an AMP company Lowell, MA

For those of us who have been involved for a long time in the RF, microwave and mm-wave world, the past 10 years have brought about some fundamental and unprecedented changes in all aspects of the business process. These changes have profoundly influenced the way we think, strategize and act as individual organizations and, when viewed from afar, as an industry in total. More importantly, these changes have driven us to consider how we address both government and commercial markets simultaneously in the context of all business functions, such as sales, technology development and productization. Each of our organizations is resource limited, and we cannot be all things to all customers. All of us need to deploy our resources in those areas where the return is the greatest and in accordance with achieving the goals of our own unique business plans.

Dual-use Technology

Dual-use technology development has risen to the top at many companies as a business and product development tool in military and commercial markets. Dual use seems to address a number of concerns from the perspective of both the buyers and the sellers. Indeed, the concept of dual-use technology originated from the Defense Advanced Research Projects Agency (DARPA) over 10 years ago. Dual use appears to be an efficient answer to the military's need for cost-effective advanced technology development. Future Department of Defense (DoD) budgets cannot afford to develop technology and weapons according to the business-as-usual technology development model. In several instances commercial applications are more dominant in a market segment than the military as off-the-shelf hardware tends to meet a lot of the military's performance requirements. Good examples of this are Motorola hand-held radios used during Desert Storm. Also, advanced commercial systems are driving technology development far more than the military ever did. Commercial electronics such as PCs come to mind as leading-edge development hardware that was not driven by military needs but by consumer demand for increased performance. Most deployed modern weapons systems computers pale in comparison in computing power to a mail-order Gateway 2000 PC with an Intel Pentium II chip offering a speed of 266 MHz, supplemented with multimedia (MMX) technology and a secondary 512 K cache. Wow! This is a lot of power for less than $3000!

Benefits of Dual-use Technology

Dual-use technology and its implementation are based on a company using its commercially developed process and manufacturing technologies on products that have requirements for military programs. A strictly military player could be encouraged to enter allied commercial markets where its state-of-the-art technology could be used to address specific commercial and industrial needs. Further, a totally commercial company could sell its off-the-shelf technology for allied defense market applications if its hardware met the requirements at a reduced price. The spin-off and spin-back benefits and economies of scale come into play directly for the DoD on all of these examples. Specifically, the contractor becomes a stronger and more robust competitor in both marketplaces, research and development (R&D) expenditures will be less, military and commercial products can be built on the same line and the likely cost of present and future DoD weapons systems will be reduced as lessons learned are applied. Members of the DoD's top echelon have endorsed this dual-use R&D concept and Defense Department policy has been written and implemented to make it a reality. Further, the government has funded many dual-use programs, which are in place to develop specific dual-use technologies with contractors to move the concept forward.

The Right Acquisition Solution

Viewing this dual-use approach in concert with the Perry acquisition reform initiatives, the adoption of best commercial practices (including the International Standards Organization's (ISO) 9000), reduced defense budgets and the urgent need for lower cost R&D developments, it would appear that the future technology needs of the military could and should be produced cost effectively under a dual-use umbrella, right? Wrong, actually dead wrong. Well, not exactly, but close! If I sound like I am hedging, it is because I am. Like a lot of initiatives today, the dual-use approach is not that straightforward. When viewed in a Washington prism, programs like dual use appear to be reasonable on the surface yet have some imperceivable, nearly fatal defects to the nonbeltway observer. Part of the problem is that dual use has not yet been embraced by many of the major DoD prime contractors. Politicians also seem to have their own axes to grind when it comes to dual use and the political battles on the Hill have been the most contentious of the debates on dual-use defense spending. Dead political bodies are everywhere on this one and most insiders are totally miffed over the reasons for the deep-seated positions the two sides are taking. Unfortunately, what seems to be lost in the uproar are the things that count the most: the merits of the case. The program merits are all of the success stories from the companies that have had positive experiences with the DoD's dual-use initiatives. So, what else is new? And what part of the truth don't you understand here? The ways of Washington? The Defense Department? Perhaps electropolitics is a bit too complex, even for Jefferson's common man, eh?

My Dual-use Background

I will try to help the debate by presenting some facts and expressing my views on dual use as someone who has been in the thick of the entire battle, a road warrior from the early days. I have worked on funded dual-use programs, fought on the Hill for them and had my head handed to me on a platter on several occasions because of them. A few times, I felt like I was taking on the entire political system over what appears to be an issue that should have stood entirely on its merits yet was totally inappropriate for the Washington crowd. Go figure!

A Proven Strategy

In retrospect, I have won more battles than I have lost and I have led my company through its own defense conversion process. Using the fundamental concepts of a dual-use technology development strategy, M/A-COM has successfully become a true dual-technology/dual-market supplier. The implementation of this market approach is the cornerstone of the company's successful revitalization and positioning efforts. Today, M/A-COM, part of the $5.5 B AMP company, receives 30 percent defense orders and 70 percent commercial orders. Incidentally, defense is the second-fastest-growing market segment at M/A-COM, outdone only by the wireless base station communications markets. We are very bullish on our defense business and its growth.

The Landscape

With that kind of a background, I will take you on a brief but comprehensive tour of dual-use programs, investigate the origins of dual use, describe the playing field, review all the parties' expectations on dual-use initiatives, point out some of the political issues and minefields, and describe some of the accomplishments and new initiatives. This information will provide you, the reader, with the right context to form your own opinions on dual use. At the end you must answer for yourself whether dual use is a concept whose time has come or gone.

Concepts and Beginnings

Most of the dramatic market changes we have seen have been driven by some critical events on the world stage, which, ironically, seem to be at opposite ends of the market spectrum of possibilities — one military event and one commercial trend. First and most important to the defense industry was the changing political landscape in Eastern Europe caused by the downfall of the former Soviet Union. From this single change came the series of events that led to the elimination of the Soviet Cold War threat and a redefinition and downsizing of the US military. This process is still ongoing. The second issue that came into play was the dramatic influence and growth of commercial communications and information technology in our lives. This trend defined the tremendous market and growth possibilities for commercial communications in a way none of us could have predicted. Let's focus on the military market first.

Defense Market Realities

With defense spending down and commercial technology opportunities opening up worldwide, the dynamics of the critical technology sector of the US economy are changing rapidly. All of the key players are following the new rules of the new game because the old rules no longer apply. The US defense industrial base, including prime contractors and their tiers of subcontractors, is shrinking, consolidating, getting out and merging. All one needs to do is read the financial section of any major newspaper to see the latest news of who is courting who in the defense marketplace or, more significantly, whose defense business is for sale as a company repositions itself and focuses on commercial opportunities. These changes are causing volatility in the defense contracting market and the result is more discord as the industry rapidly changes and reconfigures. Many suppliers diminish in this environment, and the business situation evolves into something quite different. From the DoD's perspective, there are fewer suppliers, and the need to establish a policy like dual use is necessary to shore up the supply chain. Indeed, in a national security context, a number of valid reasons exist to have a healthy, albeit smaller, defense industrial base.

New Playing Field

Quite simply, with the US military, the largest technology customer, not buying as much hardware as it used to, there is no need for (and the DoD cannot afford) a large and separate industrial base for military requirements. The numbers tell a stark tale of the trends in the defense industry. Specifically, military procurements from the DoD are down 60 percent from their mid-1980s peak to the lowest levels in over 50 years (constant dollars). These expenditures for R&D have been cut drastically (some say decimated) by well-intentioned, but by some description draconian, congressional staffers. We have shifted from an environment of spending what is necessary on defense programs; to addressing the threat through tactics, training and technological superiority; to a defense planning cycle with a bare-bones, zero-based approach to all-military spending. A frequent question running around the Pentagon is "Can we afford that capability or could we live with 80 percent of it, 80 percent of the time?" These words are sobering in defense company boardrooms.

Worldwide Commitments

However, in spite of this situation, the US military is facing a massive modernization bill, which is growing yearly. This modernization requirement is due in no small part to the extended operational tempo of US forces overseas and the Reagan equipment buildup essentially being worn out by the troops. Current military deployments of reserve units are exceeding 120 days, something that has never occurred in peacetime. The all-voluntary service is straining to keep up with the nation's commitments. Most of these deployments, such as Bosnia, West Africa, Somalia and Taiwan, were not budget items and are using large sums of money. At the top line, the DoD is facing a future of flat (best case) or declining budget authority for the foreseeable future. This issue will be debated more intently with the balanced-budget proposals and the desire by some factions to cut defense even further to pay for social programs.

The QDR and Its Impact

The recent quadrennial defense review (QDR) by Secretary of Defense Cohen reaffirms the need to fight two nearly simultaneous conflicts. The threat continues to exist, but it is not the same threat from the days of the Cold War. The US DoD still wants and needs access to the latest technology for battlefield leverage to win with a smaller, leaner military force. The country's military strategy and doctrine are dependent on this fact, as emphasized by Chairman of the Joint Chiefs of Staff General Shalikashvili in his "Joint Vision 2020" position statement. The US military must and will develop and field cost-effective systems on a significantly reduced budgetary basis. To accomplish this goal, the DoD wants its suppliers to follow a strategy of dual-use technology development.

The Microwave Industry

Indeed, it appears that we in the microwave business have been and are part of an even larger trend of groups of industrial clusters being asked to follow a strategy of dual-use technology development. We are being asked to apply our defense-developed technology to emerging commercial growth markets in addition to supporting our traditional government customer with lower costs for advanced technology. For example, the technology and product/process development for the design and manufacture of state-of-the-art commercial electronic microcircuits such as GaAs millimeter and microwave IC power amplifiers, mixers and receivers is applicable to both marketplaces. Designing these products is a complex process in terms of the engineering time and the tools and support equipment necessary for engineering prototyping and development. If we can apply the productization lessons learned and use the low cost commercial processes in our factories for defense products, we will be able to offer the DoD a more cost-effective product. Let's look at what some of these DoD program initiatives have to offer.

TRP: The Dual-use Program

In late 1992, DARPA conducted the first of several competitions for Technology Reinvestment Project (TRP) awards. The TRP program focused on seven categories of military need: military mobility and deployment; casuality treatment; battlefield sensors; command, control, communications, computers and intelligence; weapons, survivability and other; electronics design and manufacturing; and mechanical systems and materials. Some very interesting and unique attributes made the bid process unconventional. Inherent in TRP solicitation is a contractual requirement for partnerships to be formed by the industry bidders to leverage all the partners' strengths in addressing a specific technology focus area. Also part of TRP is the requirement for cost sharing by the bidders, which shares the risk of the program between the government and the bidders and shores up the level of commitment to the agreement by all parties. DARPA possessed its own authority to enter into innovative contractual agreements outside the federal acquisition regulations. In addition, the selection process was highly competitive and winners were chosen based on their proposals' merits through a fair and open competition.

Technology Development

The heart of the TRP was its cost-shared R&D technology development projects to produce the dual-use technology needed by both military and commercial customers. The DoD funding was used to ensure that the commercial R&D process created technology to meet the Defense Department's special needs and that the R&D would not happen without government support. The contractor partnerships paid for half of each project because they saw some potential for the technology to be viable commercially as well. Commercial viability will yield lower cost eventually for the DoD as it purchases military products using the technology. Thus, while the TRP's program goals are more affordable advanced defense technology, commercial viability enables those savings.

TRP Results

During the first three competitions, the TRP funded over $800 M in projects against 251 contracts. (This amount does not take into account matching contractor funds.) In the past, DARPA has estimated that approximately $1 B in company funds would have been contributed to execute those TRP projects, which included over 1000 firms, 470 universities, and 140 state and local government organizations. The TRP keyed in on several important factors that seem even more obvious today. First, it is clear that the best emerging technology is in the commercial sector. Second, with smaller defense budgets, the cost of developing and producing new defense systems is more critical than ever. Third, a smaller federal government will have to be more flexible. To have an affordable defense, the DoD must find new, more flexible ways to tap into the commercial sector's technological ideas, investments, economies of scale and vitality.

M/A-COM's TRP Program

Teamed with Northrop Grumman in Chicago, M/A-COM was a winner in the TRP technology development program and was awarded base and option contracts. The program total of $18 M was shared with the government. Our proposal was on the application of RF, microwave and millimeter technology to wireless communications and automotive sensors. This program, nearing completion this fiscal quarter, was the only large focused TRP program on microwave component product and process technology. Over 60 new products were developed, along with a large number of low cost commercial manufacturing processes applicable to defense applications. Of particular note are the various microwave power module derivatives that were developed by Northrop Grumman for commercial and defense applications. The contract sponsor and team monitor was the Microwave Shop at Wright Labs, which is under the supervision of Tim Kimerly and Mark Calcatera.

The Politics of Dual Use

The TRP became a political lightning rod early after the initial round of awards and carried that unique distinction throughout most of its life at DARPA. For some reason, this program's political problems seemed to take on a life of their own and became the centerpiece of the battlefield between the White House and the congressional leadership on a number of related issues such as levels of defense spending, technology policy and its implementation, and R&D expenditures.

Too Many Players

The TRP's problems may have stemmed from the fact that it was such a well-advertised solicitation, announced with a great deal of publicity and fanfare. President Clinton kicked off the first RF industry briefing in New York City. Most states were involved directly, universities were encouraged to be players and small businesses were asked to participate. Talk about inviting too many people to a party! It appears all of the defense, academic and small business industries were energized here in one shot. As such, many companies were involved in proposal preparation and the number of respondents was extremely high. There was no way DARPA could have seen or gauged the popularity of its program. Unfortunately, the number of losers (thousands) greatly exceeded the number of winners (hundreds); most of those folks who did not win were probably angry and made their feelings known.

Too Many Losers

In addition, the TRP seemed to target its winners at the technology base supplier level, which in a lot of cases was not the traditional prime contractor constituent base. Most primes are integrators. Therefore, a lot of the prime contractors were upset because they lost. Needless to say, we can assume the political lobby for these DoD prime contractors was very loud. I am sure their views were repeated on Capital Hill to a congressional audience willing to listen to complaints about "the White House dual-use program, run from the basement of 1600 Pennsylvania Avenue." (Yes, that is what it was called on the Hill.) Isn't politics amazing! So, with the traditional defense prime contractors not participating and defense spending dropping like a rock in the early 1990s, it was not long before congressional language attached to defense authorization and appropriation carried some TRP negatives saying defense contractors did not support TRP, had other more urgent national defense needs and the DoD needed to rethink its priorities. Needless to say, these claims aggravated the companies who were doing good work and performing well on their dual-use programs.

The Hunt for a Problem

The height of the mudslinging occurred when the General Accounting Office (GAO) was called in to investigate the TRP solicitation and award process. It was alleged that the process was carried out without regard to process or merit, making all the newspapers and trade journals. What did not make the papers and journals later on was the news that the GAO found no evidence that the allegations were true. Life in the fast lane is not pretty in Washington,DC.

TRP Leadership

The grief directed toward Lee Buchanon, the TRP director at DARPA, due to all the fighting was frustrating to those who considered themselves the faithful, the believers in the TRP idea and the need for an effective dual-use program for our national defense. He did not deserve it, but like the true gentleman he is, he always handled it with decorum and poise. Buchanon was a standup guy doing a tough job and he did it with class and style under the most difficult set of circumstances I have ever seen in my life. It was not just those of us who had ongoing projects that supported the program, many of the Washington crowd were counted in our camp, with the most noteworthy TRP spokesman, former marine commandant General Al Grey, addressing the benefits of TRP.


In last year's defense budget, the concept of dual-use funds for militarily relevant projects was emerging as the consensus play in the budget process. The TRP was dead and the D came back to the DARPA title. The new DARPA dual-use program was to address these needs and was called the Dual-use Applications Program. The role of the Commercial Operations and Support Savings Initiative (COSSI), the program's subtitle, was to develop and test a method for reducing DoD operations and support costs by inserting commercial products and processes into fielded military systems. A fielded military system is one that has some current operational capability. A system that is near the end of its useful life was not an appropriate target for the COSSI. The insertion of commercial products and processes was expected to reduce operations and support costs by reducing the costs of parts and maintenance, reducing the need for specialized equipment and increasing the efficiency of subsystems. The interesting twist in this solicitation was that it must include a letter of commitment from the user community, which must accompany the proposal and state that service's willingness and ability to fully fund the proposal's next phase in the system after the DARPA COSSI program. How's that for a commitment! The topic areas are open in the COSSI, and it is up to the contractor to supply ideas to DARPA. Program awards are imminent, so stay tuned.

The Air Force Dual Initiative: BAA 97 05

The Air Force is out in front of the other services on the dual-use trail with the publication of its broad agency announcement (BAA) on the Dual-use Applications Program in Commerce Business Daily in March. The program has all the contractual and administrative elements of the DARPA solicitation, but with a list of focused programs the Air Force would like to see proposed. The Wright Labs BAA is being conducted in cooperation with the DoD's Dual-use Applications Program and managed by the Joint Dual-use Program Office. It encompasses the familiar elements of this type of solicitation: the need to cost share, the potential for commercial applications, the need to address Air Force requirements and the issue of teaming and partnerships. A specific commercialization plan highlighting how the technology will be advanced to market is also included. Some of the specific areas under consideration by the Air Force include future air-navigation and traffic-avoidance solutions through integrated communication navigation identification, coherent conformal array/continuous transverse stub antenna technology, precise reference information for information superiority, collaborative engineering and virtual prototyping, RF multifunction structural aperture, electrically powered hydraulic systems, switchable polymer-dispersed liquid-crystal holographic materials for high resolution displays, identification and structural quantification of structural damage in aircraft and the extension of aerospace computational fluid dynamic software to nonaerospace applications.

COTS Hardware

There is tremendous interest in the use of commercial off-the-shelf (COTS) hardware in the defense industry. Both service and contractor personnel are aboard the COTS bandwagon and the reasons why COTS makes sense for DoD procurements. I believe that much of the importance and the true impact of COTS has yet to be recognized by the DoD in its procurement practices. However, I also believe there is a significant danger of oversimplification of what COTS is and is not in the DoD environment. Specifically, I am concerned that annual government laboratory budgets, including DARPA's, for the continuing investments in RF technology are being cut under the assumption that commercial developments or COTS hardware can handle the system needs. In my view, it is essential to the continuing development of our weapons systems that ongoing investments be made in those RF technology areas not served by COTS. While this may sound programmatically simple, and it is, the technical issues associated with this technology development for power, bandwidth and frequency are complex. Without the advanced technology feeding the next generation of eyes and ears of our systems, the advantage we now enjoy will go to our enemy who has equipment available commercially. Commercial electronics will continue to be used in some parts of DoD weapons systems but are not capable of meeting all the sensor electronic requirements of present and future military systems. If we walk away from this problem as an industry segment, we will be opening the door to our enemy. For his worldwide command, control and communications, he will use an Iridium phone for voice and data, and precision targeting and location finding for his ordinance will be performed on a simple, low cost Global Positioning System receiver. It sounds unreal, but it is true.


The approach of leveraging commercial technology progress for military benefits is at the core of a dual-use technology development philosophy. A new set of challenges exists for the DoD today, highlighted by the necessity to remain superior militarily in the face of uncertain times, fiscal constraints and revolutionary changes in the way battles are fought. Recent DoD-funded dual-use programs with contractor investment have proven to be worthwhile, yet have faced a maelstrom of negative publicity. Newer programs with more direct military service linkages run by the services appear to be the best bet for future dual-use initiatives. However, in July Congress deleted $100 M, or approximately 50 percent, of all the DoD's funds for dual-use applications programs.