Debra Anderson, F-35 warehouse specialist with Defense Logistics Agency Distribution Hill, Utah, builds kits for F-35 wheels to be repaired by the Air Force Repair Squadron at Hill Air Force Base, April 13, 2022.

Debra Anderson, F-35 warehouse specialist with Defense Logistics Agency Distribution Hill, Utah, builds kits for F-35 wheels to be repaired by the Air Force Repair Squadron at Hill Air Force Base, April 13, 2022. Defense Logistics Agency / Nutan Chada

Pentagon unveils its long-awaited defense industry strategy

The first-of-its-kind document aims to address fragile supply chains revealed by a global pandemic and simultaneous international conflicts.

One thing is clear in the Pentagon’s first and much-anticipated defense industrial strategy: weapons and technologies must be purchased and ready for mass production quickly. But the question remains: Will there be enough money to make this happen?

The Defense Department’s national defense industrial strategy, released Thursday, outlines four main priorities, all of which have been prominently discussed in recent years: resilient supply chains, workforce readiness, flexible acquisition, and economic deterrence. 

“The current and future strategic environment requires immediate, comprehensive, and decisive action in strengthening and modernizing our defense industrial base ecosystem to ensure the security of the United States and our allies and partners,” Deputy Defense Secretary Kathleen Hicks wrote in the document's introduction. 

“A lot of what needs to be accomplished is known at this point. And what the strategy does pretty well is create a sensible framework for achieving those things. And that's an important objective,” alongside its emphasis on data analytics and advanced technology, Tara Murphy Dougherty, CEO of the data analytics and decision science firm Govini, told Defense One, noting DOD’s call to use data to better identify supply chain risks. 

Wars in Ukraine and the Middle East, combined with ongoing tensions in the Pacific, have put increasing pressure on the U.S. defense industrial base to provide munitions and other supplies, and have “spotlighted gaps in national stockpiles and challenges in replenishing existing ones.” Stockpile inventory management is critical to preventing those challenges, the strategy states. 

“These inventories and stockpiles act as shock absorbers for the supply chain and help to mitigate near-term risks, including from unanticipated demand spikes or supply chain disruptions,” the document states.

To fix that, the Pentagon wants to expand and create new stockpiles for critical parts and commodities while also identifying supply requirements for critical minerals and components threatened by international conflict.

“This strategy is about balancing the tension points of maintaining and sustaining…how we're going to repair existing parts, how we're going to replenish parts that we are pulling from our stocks to give to our allies and partners, to make sure that we keep our own steady state as necessary, but also preparing for different theaters, thinking through where there is opportunity space to invest in the technologies of the future that are going to enable more advanced weapons systems,” Halimah Najieb-Locke, DOD’s acting principal deputy assistant secretary of defense for industrial base policy, told reporters Thursday.

But the real test, as with any strategy document, is with implementation and resources. The Pentagon plans to release a detailed—and classified—implementation plan by March, in addition to an unclassified summary of the plan. 

Resources are less clear. 

“If the President's budget [for fiscal year 2025] has clear and increased levels of investment to implement the strategy, that means a lot. That means that the administration…they're standing behind the words of the strategy,” said Jerry McGinn, executive director for George Mason University’s Greg and Camille Baroni Center for Government Contracting. “The overall system needs to be more flexible and agile, which is what [the Pentagon’s drone swarm initiative] Replicator is attempting to do.” 

For example, more funds for the Defense Exportability Features program, or DEF, which Congress greenlit in 2011 to help facilitate foreign sales, could be a sign the new strategy is working, McGinn said.  

“It has been budgeted at $10 million per year for a decade. If DOD is serious about the issue, they will at least increase that,” McGinn said via email, noting DEF received a bump last year as part of supplemental funding to Ukraine, “but that needs to stick.”

The Defense Department and Congress have long lamented and tried to reform the rigid and slow-to-adapt acquisition system. But two of the biggest challenges have been scaling to meet demand and bringing in non-traditional companies to do innovative work. 

“One thing that we're focused on on the investment side is continuing the use of tools, such as the Defense Production Act, the Industrial Base Analysis Sustainment program—which to date, has invested more than $1 billion dollars in our industrial base—and things such as rare earth elements, microelectronics, thermoplastics, metals like titanium,” Najieb-Locke said. “We're really trying to continue that effort by streamlining the entire defense budget to industrial mobilization where we see those main vulnerabilities.” 

For Murphy Dougherty, some of that spending needs to go to the Defense Department’s program offices that design and execute contracts, not just programs of record. 

“[The NDIS] is never going to be effective if we don't take that same set of goals and apply them to the DOD system that actually generates the capabilities the industrial base makes and supports,” she said. “Because a lot of money is already going to defense programs. Very little to no money goes to the program offices in order to be able to manage those efforts, oversee their programs, [and] interact with the industrial base partners in a modern sophisticated technology driven way.”

Anthony Rapa, co-chair of the international trade group at the law firm Blank Rome, said achieving everything in the document will require multiple conversations—with Congress and industry. And it’s going to take time. 

“It's going to require things like workforce training, better tracking of sub-tier suppliers, more outreach to suppliers, lowering the barriers to entry for them and helping them to comply with regulations. maybe making some of that easier for them. All of these things make total sense in terms of how to address the problem they've diagnosed,” Rapa said. “But to accomplish these things…we're talking about a period of years, and we're talking about a generational-type modernization of the defense industrial base.”

NEXT STORY: I'm terrible at goodbyes