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Secretary of Defense Lloyd J. Austin III and Deputy Secretary of Defense Kathleen Hicks hosted the Defense Innovation Board (DIB) for its winter Board meeting in the Pentagon on January 13th, 2025.  Underscoring Secretary Austin’s commitment to defending the nation through innovation and modernization, the DIB, chaired by Michael R. Bloomberg, discussed its efforts to catalyze and empower defense innovation leaders within the DoD and the defense industrial base.  The Board presented its two latest studies on Scaling Nontraditional Defense Innovation and A Pathway to Scaling Unmanned Weapons Systems.

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The Department of Defense released an update to the names of “Chinese military companies” operating directly or indirectly in the United States in accordance with the statutory requirement of Section 1260H of the National Defense Authorization Act for Fiscal Year 2021.  The People’s Republic of China’s (PRC) Military-Civil Fusion strategy supports the modernization goals of the People’s Liberation Army (PLA) by ensuring it can acquire advanced technologies and expertise developed by PRC companies, universities, and research programs that appear to be civilian entities.  Section 1260H directs the Department to begin identifying, among other things, Military-Civil Fusion contributors operating directly or indirectly in the United States.  The Department will update the list with additional entities as appropriate.

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“Under the Buy American Act components of end products that are sold to the federal government can also be subject to tariffs,” said Dan Ramish. The Federal Drive with Tom Temin get a detailed look now from Haynes Boone procurement attorney Dan Ramish.

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The U.S. Small Business Administration (SBA) proposes to revise its Small Business Subcontracting Program regulations to encourage faster payments to small business subcontractors and streamline the reporting process for prime contracts. This proposed rule will require prime contractors notify contracting officers in writing when it fails to make full or timely payments to the subcontractor within 30 days past due; require prime contractors cooperate with contracting officers to correct/mitigate this failure until payment is made in full to the subcontractor; and allow contracting officers to modify a prime contractor’s past performance for failure to make full or timely payments.  Comments must be received on or before February 18, 2025.

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The Department of Defense’s Office of Local Defense Community Cooperation released its Fiscal Year 2023 Defense Spending by State report to help states and communities better understand how Defense procurement, personnel, and grant spending impact their economies.

The report’s graphs, maps, and tables present a range of findings, such as total spending figures, categories of contracted goods and services, major defense vendors, numbers and types of defense personnel, and grants awarded by the Department of Defense (DOD).  This snapshot provides public and private leaders with a starting place to assess how defense investments across installations, communities, and the private sector can be optimized by supporting regional innovation, industrial capability and capacity, supply chain resilience, and cultivating a skilled workforce.

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Contractors are a critical force-multiplier during any disaster response. The U.S. Army Corps of Engineers (USACE) relies heavily on these partners in industry to help meet mission requirements quickly, efficiently, and effectively. To facilitate rapid engagement with the industrial base, USACE maintains an inventory of already awarded contract tools, pre-positioned to support major emergency response missions.  These contracts are part of the USACE Advanced Contracting Initiative (ACI), a program developed and implemented specifically for emergency and disaster scenarios. This suite of targeted contract tools provides USACE with a rapid response capability to support a wide range of mission requests, to include needs such as bottled water, packaged ice, debris removal, and temporary roofing. All companies doing business with USACE must be registered in the System for Award Management (SAM) and their registration must be in an active status.

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The FY2023 data in eSRS indicates that, for categories where a goal was established, 64% of the goals for small business on completed contracts were met or exceeded, and between 40 and 55% of the five socioeconomic small business goals were met or exceeded. The aggregate dollars lost by all small business categories when contractors fail to achieve their goals is substantial. If contractors had met their subcontracting plan goals on completed contracts, small businesses would have received $1.5 billion more in subcontracts, SDBs would have received $857 million more, and SDVOSBs would have received $383 million more.

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The Defense Department will be starting a new program for “commercial tool demonstrations” to help small businesses learn about and strengthen cybersecurity measures “within the next year,” a department official said Aug. 8. In fiscal year 2023, Congress required DoD by 2027 “to establish a new program where we actually do commercial tool demonstrations for small businesses to help them to understand what their risks are when it comes to foreign control and influence,” Farooq Mitha, director of the DoD Office of Small Business Programs said. The strategy was designed to make it easier for small business to “do business with us, reduce barriers to entry, create some more alignment between our small business programs and provide more resources to small companies that are looking to do business with us,” Mitha said.

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The Department of Defense is executing a warfighter-centric innovation strategy to meet the urgent needs of the National Defense Strategy. Recognizing there is no silver bullet that can solve all the challenges DoD faces, DoD’s innovation initiatives span every stage of capability development and every process step, from policy to acquisition.

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In 2022, Secretary of Defense Lloyd J. Austin III directed the creation of a “tiger team” to look into ways the Defense Department could make the Foreign Military Sales system less foreboding for partner nations interested in purchasing U.S. military hardware. The team wrapped up operations in the spring and transitioned into a Continuous Process Improvement Board, or CPIB, meant to implement solutions recommended by the tiger team and to also be on the lookout going forward for new and novel ways of their own to improve the FMS system. Since then, the department scored wins by implementing four tiger team recommendations: establishment of the CPIB, creation of the Defense Security Cooperation Service, standing up of the Security Cooperation Execution Focus Forum, and the development of an acquisition and sustainment tool kit.

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