Copyright © 2017 Boeing. All rights reserved.

Mike Manazir Vice President, Navy Systems The Boeing Company

2018 Air Power Conference March 15, 2018

Imperatives, Opportunities and Challenges in the Digital Age; An Industry Perspective

2

Except as otherwise noted, the views in this presentation are solely those of the presenter based on his personal experience in the U.S. Navy as well as initial impressions since joining industry. Specifically, comments herein do not represent Boeing policy.

Aerofiles.com

3 Wide bipartisan agreement: military readiness has declined; U.S. industrial base would have difficulty surging -AIA

DEFINE THE PROBLEM

My definition of insanity!!

“Takes Too Long and Costs Too Much”

Chess.com

4

“You never change things by fighting the existing reality. To change something, build a new model that makes the

existing model obsolete.”

R. Buckminster Fuller Systems Theorist

5

§  Maritime System §  Information System §  Rate of Technology Change §  Budget

FOUR FORCES DRIVING CHANGE

Images courtesy U.S. Navy

6 Unsustainable for the government and the private sector

HISTORIC BUDGET INCONSISTENCY

ADMINISTRATI

ON

CHANGE

SEQUESTRATION

CONTINUING

RESOLUTION

7

Hon. Pat Shanahan, Deputy Secretary of Defense*

§  “The Department shouldn’t be setting standards, industry should be setting standards.”

§  “[DoD] knows that [industry is] going to invest, it’s just that we have to be very clear on how we want to integrate those investments and how we want to evolve certain capabilities”

§  “Our goal is to get a lot of the data into an environment where we can start making better decisions.”

§  “At the core of the recently released National Defense Strategy”; §  “We must make our systems and products affordable.” §  “Our biggest opportunity is to be smarter and faster when it comes to the development of these programs.”

INDUSTRY CAN TEACH THE PENTAGON

Speech at WEST Conf, 6 Feb 2018

Image courtesy of WSJ.com

8

Industrial Base Working Group (IBWG) Four Pillars to success

§  Robust, balanced and stable defense funding

§  Streamlined acquisition policy

§  A talented workforce

§  Stewardship of key capabilities

AEROSPACE INDUSTRIES ASSOCIATION (AIA)

9

§  Robust budgets – buy back readiness capability §  Balanced funding – readiness, modernization, procurement §  Stable appropriations – across fiscal years, long-term planning stability, supply chain management §  Reforming the contracting process – curtail LPTA use, de-layer duplicative process, more MYP use §  Improved DOD-industry dialogue, encourage innovation – risk/reward, IR&D alignment, protect IP §  Synchronized defense and commercial aerospace trade policies – defense exports to trusted allies

§  Commercial export trade creates economies of scale and revenue: sustain and drive defense innovation §  Invest more in STEM education to develop critical skills – traditional and emerging

§  Aero, mech, electrical plus cognitive computing, AI, machine learning, materials and data science §  Modernize and accelerate the security clearance review process §  Adapting business processes by embracing digital transformation – max use of data §  Fostering innovative technologies – secure access to hardened microelectronics, advanced

materials that are lighter and more durable

AEROSPACE INDUSTRIES ASSOCIATION (AIA) Industrial Base Working Group (IBWG) Ten Fundamental Priorities

10

Program Value

NEED TO CHANGE OUR FUNDING PROCESS

Time

Proposed

Current

11

IMPERATIVES

•  Innovate, Prototype, Experiment, Demonstrate •  Accelerate Innovation Loop •  Be Willing to Fail

•  Know and manage the risk – improve rate of return

•  Match acquisition/engineering risk with operational risk

•  System of Systems/Services Approach •  Integration and Interoperability (I & I) is key to a Kill Web mindset •  Independent Interconnected Federated Integrated Interdependent

•  Modeling, Simulation, and Analytics •  Live – Virtual – Constructive (LVC) Immersive Environment

•  Open Architecture essential to control costs; ability to adapt, grow, match legacy to future •  Cross Domain enablers

OPTIMIZE GOVERNMENT – INDUSTRY TEAM INDUSTRY MUST PARTNER WITH GOVT – “BEST ATHLETE”

12 What do these four concepts have in common?

INNOVATE, EXPERIMENT, DEMONSTRATE

AEGISWeaponSystem,1983

World'sfirstnuclear-poweredsubmarineUSSNautilus(SSN-571)1958

CarrierAviation,1942

StrategicandTechnologicalNecessity

DefendtheForce

ChangingtheStrategicCalculus

IntegratedBattleforce2030

PeerCompetition&HighEndConflict

Images courtesy of U.S. Navy

Copyright © 2017 Boeing. All rights reserved.