DARPA's Ambitious Plan to Rethink Military Manufacturing

INNOVATION
CHALLENGE
Incontro per il Premio Innovazione
Livorno – 6 maggio 2013
© 2013 X-FERT INNOVATION srl

Incipit
LE ORGANIZZAZIONI* NON
FALLISCONO PERCHÉ SI PONGONO
OBIETTIVI TROPPO AMBIZIOSI
CHE POI NON RIESCONO A
RAGGIUNGERE MA PERCHÉ SI
PONGONO OBIETTIVI TROPPO
MODESTI E LI RAGGIUNGONO.
© 2013 X-FERT INNOVATION srl 2

Was/Will be Our Sector Attractive?
Unattractive Attractive
Yesterday Tomorrow Tomorrow
Rivalry
H L
? ?
among firms
Power
H L
? ?
of suppliers
Power
H L
? ?
of customers
H
Barrier to
Entry/Exit
Availability
of Substitutes
L
?
H L
?
? ?
H = High
L = Low
Yesterday

H

Innovation 1: Business Model
The Business Model Canvas
Key
Partners
Illustrative case,
disguised
Cost
Structure
Key
Resources
Develop a web-based
knowledge community
relations with CPOs,
CTOs CXOs.
Channels
Key
Activities
Value
Proposition
ABC provides distinctive
characteristics for a wide
range of uses
Revenue
Streams
Key
Partners
Key
Activities
Value
Proposition
Customer
Relationships
Customer
Segments
Key
Resources
Channels
Cost
Structure
Revenue
Streams
2 segments with very
different identities:
• Chemistry (mass)
Dominates the
advantage of
infrastructure (cost-focus,
strandardizzazione,
efficiency;
• Diversified (niche)
Competition on talent
and collaboration with
the stars”.
Web sales focused on
user communities
Design-to-Order as a
premium service
reserved to strategic
clients
Continuous learning and
development of ever
more efficient production
processes
Patents filing to support
and protect materials
distinctiveness
Highly structured Sell-side
process
Talented designers able
to enhance the
properties of the
material and to give
value ABC’s brand
• Enhancement of use
function
• Brand recognition
• Licensing
• Fixed costs;
economies of scale
• Variable costs;
economies of scope
Key design parameter
Key design parameter © 2013 X-FERT INNOVATION srl 5

M 9025/543/mg
Priority vector for
value realization
Innovation 2: Value Engine (1)
Competence
development
Process
redesign
Future
Decode
Weak Signals
Projects
Process
Management
Presente
Transfer
value
Past
Understand
Experience
Know-where/when”
Anticipation
Know-what”
Know-how”

M 9025/543/mg
Future
Progetti
Present
”Do the right things
Competence
development
Process
redesign
Process
Management
”Do the things right
Past
Innovation 2: Value Engine (2)

Management must pursue two concurrent business construction and deconstruction paths:
• Differentiation-creating innovation
• Productivity-enhancing deconstruction
Disruptive
Innovation
Product
Innovation
Application
Innovation
Process
Innovation
Technology Adoption Lyfe Cycle
Business
Model
Innovation
Experiential
Innovation
Marketing
Innovation
Structural
Innovation
Revenue Growth
Time
8
Innovation 3: Life Cycle Challenger

Only 5.400 days!
The Internet
• 100 billion clicks per day
• 5% of the worldwide energy
• No a single breakdown so far !!!!!!!
All in One!
• The very first trans-human man-made product
• The power doubling every two years
• Processing power of entire mankind in a single pc within 2040
• The man becoming an extension of the “Big Machine” What next?
• What can we expect from it in the next years?

DARPA: Manufacturing is Back!
MIT TECHNOLOGY REVIEW TECHNOLOGYREVIEW.COM
full prototype is actually built, triggering
costly do-overs.
Consider the Pentagon’s F-35 Joint
Strike Fighter, a plane meant to be used by
all branches of the military. The program
has seen huge delays because of unexpected
defects, like overheating caused by the hun-dreds
of computer processors that run the
jet’s avionics, communications, and weap-ons.
The F-35 is now expected to cost $135
million per plane and $1.5 trillion over the
life of the program, making it the most
expensive weapon in military history.
To test ways to avoid such problems,
DARPA now plans to build an amphibi-ous
assault tank using a process that lets
designers predict how all its components
will interact before it is ever made. Its goal
is to begin producing two vehicles a week
by 2016—a development process five times
faster than what would be possible with the
usual procurement methods.
The project's first phase is a public
design competition offering $1 million to
whoever submits the best design for the
To make sure these systems work
together properly, DARPA is relying on soft-ware
that can visualize the way they will
interact in the tank. The agency also hopes
to cut costs by using laser cutting and 3-D
printing to make complex shapes directly
from designs.
Part of DARPA’s approach is to involve
manufacturing experts—the ones who
understand what factory-floor tools can
and can’t do—at a very early stage. “Design
is king, but the designers might not under-stand
the implications of things like materi-als
selection and tolerances or how systems
interact,” says Mark Traband, head of man-ufacturing
systems at Penn State’s Applied
Research Laboratory, which won a $48 mil-lion
contract from DARPA last summer.
After the agency picks a winning design
for the vehicle’s chassis, Penn State will have
seven days to estimate how much the chas-sis
will cost to manufacture. The lab will
also help build it. “Manufacturing engineers
are often at the tail end of the design pro-cess,”
says Traband. “Typically, when they get
Emerged Technologies
DARPA Wants
to Remake
Manufacturing
The military research agency hopes to
design and build an amphibious tank
from scratch in three years.
OThe Defense Advanced Research Projects
Agency (DARPA) is launching a $300 mil-lion
collection of research efforts to change
the way the military models, designs, and
ultimately manufactures its next generation
of vehicles and weaponry.
Very few countries are able to manufac-ture
military jets and warships that marry
electronics, novel materials, and cutting-edge
propulsion systems. But trouble often
BUSINESS REPORT — NEXT WAVE OF MANUFACTURING

14
at Rock Island Arsenal, a military base in
Illinois. Similar contests will determine the
designs of the chassis and armor.
stress cracks may arise from the way those
systems interact, but in many cases those
problems don’t become apparent until a
Emerged Small Give Once-Baxter that competes OChris a in Southington, plastic one cares screen, can see the by man Budnick, misses Bellwether Case: DARPA Amphibious Thank
A conceptual rendering of
DARPA's amphibious tank.
Development Plan
• Producing 2 vehicles by 2016
(5 times faster than with
traditional procurement
methods)
• First Phase: Public design
competition (“open to anyone
with a laptop”)
• Winning design assembled
this summer at Rock Island
Arsenal
• New software capabilities that
can visualize the internal
systems interactions
• Involve manufacturing expert
at a very early stage
• Manufacturing cost to be
estimated after 7 days from
winning design selection.

The Hype Cycle of Emerging TechnologiesProject
Document
Source: Gartner, July 2011.

Gesture Recognition
Human Augmentation Virtual Worlds
Project
Document
Source: Gartner, July 2011; Evalueserve analysis, 2012.
Biometric Authentication Methods
Augmented Reality
Expectations
Time to plateau
Computer-Brain Interface
㼂㻯㻿㻒㼀
Systems
2025
VCST Systems Technology Cluster

Predictive Analytics
Battlefield Robotization Technology Cluster
Wireless Power
Image Recognition
Mobile Robots
Gesture Recognition
Machine-to-Machine Communication Systems
Mesh Network Sensors
Biometric Authentication Methods
Expectations
Time
Computer-Brain Interface
Synergy with VCST
Project
Document
Source: Gartner, July 2011; Evalueserve analysis, 2012.

Competence Portfolio Benchmarks
Littoral Undersea Warfare_2025
Deepwater Oil Rigs as Strategic Weapons
Competence
Structure
1
2
3
4
5
Commitment
to Innovation
Cost
Global
Reach
Underwater
Acoustics
Excellence
Consciousness
Width of
the Business
Network
Partners
Visibility
Dual
Focus
Research
Productivity
5
4
3
2
1
Referrals © 2013 X-FERT INNOVATION srl 16

I(P)ntellectual Capital

A New Enterprise Concept
To seize an opportunity it is increasingly necessary to understand its value before
everybody else. Accelerated knowledge (≈ clarity) capture is a key success factor.
A start-up works as a “knowledge accelerator”:
for providing a steeper clarity curve.
Clarity
Enterprise
=
Accelerated knowledge curve
Value
Opportunity
Time
Knowledge
• a vehicle
• for accelerated growth
• of differentiating capabilities

Innovation 4: Be the Nework you Need to Be
Il ridisegno dell’organizzazione è un passaggio chiave per integrare le valenze combinate del business network
esterno con quello delle competenze interne per definire una proposta e contenuti di valore Market-Driving.
Proposition
Value
Market-Driving
Value
Network
Value
Proposition
L’azienda
(network organizzativo di competenze)
Il Business
(network economico di aziende)
Tags:
• Brain Drain
• Defense transformation
• Frugal Engineering
• Group Think

“smaismrmilmepoetaleumibunenug0auiras”

The “Discipline” Issue
• Some disciplines have real “experts”
• Some others have do not
http://dailycurrant.com/2013/03/06/paul-krugman-declares-personal-bankruptcy/
23

What is a Start Up?
24
A temporary organization designed to
search for a repeatable and scalable
business model
• Temporary
• Search
• Repeatable
• Scalable
• Business model

Exploration vs Execution
Failures are an integral part
of past (and future) successes.
John Chambers, CEO, Cisco
Business Model Business Plan
Customer Discovery Customer Acquisition
Customer Development Organizational Structure
Minimal Product Structured Architecture
1. MW / ID:
• Mile Wide
• Inch Deep
2. IW / MD:
• Inch Wide
• Mile Deep
Prioritized
opportunity
Opportunities
and/or
pain points

Everest, North Face INNOVATION
CHALLENGE
2
6
Your Innovation Challenge: __________________________

Creative Automotive Factory Lab

Local Motors: DARPA XC2V Model

30

The Digital Manufacturing Revolution

“La ricchezza economica è come il krill: miliardi di piccole opportunità
imprenditoriali in attesa di essere sfruttate da persone intelligenti e
creative.” Cory Doctorow, Makers

Professional Profile
Nicola
Diligu:
One-‐Page
CV
• Founder and CEO, X-Fert Innovation srl
• Business Partner, Signals Intelligence Group Inc.
• Mechanical Engineering, MS, University of Genoa, Italy
• Post-Graduate Sudies, Stanford University:
- Industrial Robotics, IEES, Terman Engineering Center (1984)
- Marketing Management, Graduate School of Business (1999)
Qualifica5ons
Industry knowledge: large companies and industrial groups, national and international, in the Aerospace Defense, Automotive
and High-Tech, and their complex engineering products and systems.
Core competencies: scenario development and analysis, competitive landscapes and intelligence, business strategies and (open)
technology innovation supported by value and “should-cost” engineering, lean integrated product development process, intellectual
property management, extended organizational redesign to support innovation and strategic turnaround.
Current focus: 2020/2050-horizon, technology-driven business transformation in the defense and manufacturing environments;
rapid strategy research support processes/services (in cooperation with a selected partner) – accelerating client’s company learning
and competitiveness.
Workshops and keynotes: Perspectives on Extreme Future, Invention Factory, and Vision Engineering (all three topics about the
complex role of technology as a driver of invention and innovation in the economy and social context); Competing with radical
innovation, The network-based “smart” innovation; Appropriability strategies for innovation investments.
Esperience: Manufacturing partner at three leading consulting firms worldwide: Deloitte Consulting [DC], Capgemini, Arthur D. Little
[ADL]. Managing Director of Organizational Dynamics Inc. [ODI] in Italy. The roles were accompanied by important organizational
assignments: European Practice Leader [Product Innovation, DC]; Global Practice Leader [Radical Innovation, ADL]; European
Competence Leader [Process Re-engineering, ODI]
34
________________________________________________________________________________
Nicola Diligu
Current Positions
Languages Italian, English, French.
________________________________________________________________________________

The End
Thank You!

DARPA's Ambitious Plan to Rethink Military Manufacturing

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