No Match Found
Defence contractors are losing their edge in the aerospace and defence (A&D) market. AI, connected devices, autonomous platforms, VR and robotics are in demand by defense departments.
An ideal operational relationship between global militaries and defence industry manufacturers would support risk taking to drive private-sector technological advances, whilst simultaneously guarding against budgetary excesses. But no country with a major military has been able to put these pieces together satisfactorily.
In the US and much of the West, the disconnect between the public and private sector is chronic, in part because military spending is cyclical and does not grow materially over the long term. Consequently, identifying and funding projects that bring tangible returns in a relatively short period is usually a priority for defence departments. But to prove out new technology so that it can be utilised in next-generation military equipment requires a substantial commitment of up-front R&D and engineering resources, at least some of which falls on the private sector. In many cases these companies are loath to make these investments without an assurance that they will be adequately covered.
As a starting point, the government and the defence industry should address these immediate issues in order to create a more welcoming environment for innovation:
There is also a knowledge gap between leaders in Washington, who are mostly lawyers struggling to understand recent technological advances, and executives in Silicon Valley, who are mostly engineers struggling to understand the age-old dynamics of international power politics. In the past, it wasn’t difficult for policymakers to understand the essence of breakthrough technologies such as the telegraph, the automobile and nuclear fission. Technology moved faster than policy, but the lag was more manageable. Digital technologies are different, spreading quickly and widely, with societal effects that are hard to imagine.
These issues and others that separate military agencies from the private sector are hurting the prospects for growth for traditional defence suppliers and the increasing number of startups involved in the industry. In the end, in developing nations or the West, a concerted effort by governments and the defence industry to identify key issues and strategies for resolving them will be necessary to overcome their negative impact.
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