Christopher Kirchhoff: evaluation

Transcript context

…Is there some reason in the incentives to think Unit X won’t ossify? Or is your view simply, for now, newness is enough? It may well ossify, but then we’ll create a new structure yet again. There is this Hegelian dialectic in the history of defense agencies. DARPA was created originally to solve a crisis in space flight because the Air Force wasn’t up to snuff. It actually spent some years in the wilderness before becoming the dynamic institution that we know it today. So far, the trajectory of Unit X has been very successful. Part of the reason for that is we have people that come there, kind of like DARPA, for a few years at a time on rotation. Our project managers — they’re very focused on getting things done. Oh, by the way, we’ve pioneered a way to buy technology at Silicon Valley speed. If you want to go buy a fighter jet or an aircraft carrier or a military radio, you’re looking at using the federal acquisition rules, this Old Testament–like system of regulations. Negotiating a contract typically takes 18 to 24 months. If you’re a start-up, that simply doesn’t work because you have to show profitability before your next round of venture investment, which you’re going to raise inside of that timeline. Which is why, when we arrived in the Valley in 2016, venture capitalists would actively pull funding from start-ups that tried to go after government contracts because they knew, in the end, it wouldn’t be profitable. So, DIU had to figure out a way to break through that. We did it through the ingenuity of a single person. This is a heroic story of how one person can really effect change in the Department of Defense, a three million–person organization. Her name was Lauren Dailey. We met her when she was 29 years old. She’s an acquisition specialist, stays up all night reading the newly released National Defense Authorization Act, another dictionary-size tome of law. Our fourth day on the job, she comes to Raj and me and says, “Hey, I found this sentence in section 815, and I think it’s a giant loophole we can use to create a whole new system of contracting.” Raj and I say, “It sounds fantastic.” This is the biggest problem. We have to come up with a bigger system of contracting, and if we can’t do that, DIU will fail. Lauren says, “Great. Here’s the 20-page white paper that I wrote about it.” Quite literally the next day, Lauren and I got on a flight to Washington, and we met in rapid order with the head of acquisition policy for the department, with the head acquisition lawyer for the department, and with the Department of Defense general counsel. And they all agreed, and Secretary Carter blessed, a whole new regime of using other transaction authorities, this Apollo-era little-used contracting mechanism to let contracts in between 30 and 60 days. In two weeks, we got the department to declare DIU could use this new method. In the eight years since Lauren had that idea, $70 billion of technology has been acquired by the Department of Defense using the method that she pioneered. Does China have something at all like Unit X?…

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