Commentary | March 27, 2017

What is Military District 5 [MD5 Podcast]

By Scott Aughenbaugh and Jay Harrison Podcast


[00:00:00] Scott Aughenbaugh: This is an MD5 podcast. My name is Scott Aughenbaugh and today I am sitting down with Jay Harrison, the Director of MD5 to learn about who he is, how this organization started and where this fits in the DoD Innovation Mission Spectrum.

Jay, thanks for agreeing to do this.

I was wondering how you got into this field and where did the idea to focus on the human network of innovation come from?

[00:00:22] Jay Harrison: I’ve been working more or less from the same problem—the innovation problem—in and around DoD since about 1999. Which is when I came into the civil service and it’s taken on different forms. I’d say in the earlier days it had a lot more to do with how do we harvest technology from the commercial marketplace and modify it to support emerging operational needs in the battlespace. And particularly after 2011, that type of work picked up. And then in my company, when I left government in 2006 after having run a rapid acquisition organization for DoD, I built a business more or less around that idea that we see more and more national security relevant technology stemming from the commercial marketplace or research and development outside of the traditional DoD community and how does DoD leverage some of that output to support our requirements. So very much in line with what I see the Defense Innovation Unit Experimental doing today. Looking into the marketplace, following the marketplace, and then leveraging what the marketplace has to offer national security.

So after I exited my company, I wanted to get back into the public sector and one of the early opportunities that presented itself was to work with universities to harness what they are doing and align universities with the emerging needs of national security. And if you think about it, universities are a source of great technology. They are also a source of the human capital that DoD needs to be leveraging to execute our various missions and to create the future defense workforce. So, I’d say on top of that, what I quickly discovered is that most universities are pretty ignorant when it comes to dealing with the national security community. There are few universities that do really well, but 95% of our great national universities have very little experience doing business with DoD. So how do we build those bridges and it started out as more of a technology focus and quickly pivoted to its individuals who are driving innovation today. The obsolescence cycles of technology are really fast. And we have to have people who are adaptive and creative and capable of aligning emerging technology with emerging market opportunities or emerging national security needs and then repeat at faster and faster rates. That is not about finding technology, it is not about building technology, it’s about that dynamic almost arbitrage process of taking technologies and aligning them with the value creating opportunities at rapid cycles.

So, my whole thinking about innovation over a period of a couple years pivoted more towards the human side—the network side—of innovation and that’s where the idea for MD5 came from.

[00:04:03] Scott Aughenbaugh: You mentioned MD5, what is it and what does the name mean?

[00:04:06] Jay Harrison: So the original—we'll call it investigation—into the business model that MD5 executes, came out of a summer study that was sponsored by New York University in 2015 and at the time the concept was called the National Security Technology Accelerator. Now there happened to be a non-governmental entity that was already using the name National Security Technology Accelerator, which on the road created some confusion and set us on the course of trying to identify an alternate brand. So we started to think about how can we come up with a brand that harkens back to the military heritage of our organization. And oh by the way, you know DoD is the font, I would argue, of innovation in our national economy. How do we harken back to some of that and at the same time not present a civilian facing image that is traditional DoD. So we like the MD5 name, “Military District Five,” because it is our physical home. Military district five is the name that Pierre L’enfant gave to Fort McNair in Southwest DC. You know we are the southernmost point of the tip of the District of Columbia. A militarily significant location for the capitol as it was being built. And it also recognizes the fact that Fort McNair was the Washington arsenal at one point, so there was research and development, there was this tradition of innovation taking place in the physical environment where we have made our home. So that’s all symbolized in this MD5 name.

[00:05:56] Scott Aughenbaugh: There is a quote from John Boyd that you often use when talking to other groups. “People, Ideas, Technology. In that order.” Why is that so important as we think about innovation for DoD?

[00:06:06] Jay Harrison: You know—aside from the fact that it’s true—I think DoD often times has a problem of getting distracted by the bright shinny object without making the longterm investments in our human talent, our people who are really driving the innovation process. But irrespective of that, the thing I like about the John Boyd, "People, Ideas, Technology," quote is that there is the false narrative that’s been created by—you know and I will say—high-tech startup communities that will not be named. That all innovation comes from those locations. And if you go talk to venture capitalists in those locations, they’ll tell you the way they invest is first in people and teams, second in markets, third in technology. So in both cases the technology is actually the least important criteria for what they are looking for. And on a couple of occasions I have talked with venture capitalists who were aware enough to know where that idea came from and they credited back to John Boyd. So when people say that DoD’s slow, that we're plodding, that we're bureaucratic, that we don’t do anything interesting, that’s—in my opinion—a sign of ignorance.

We are the foundation of the innovation that we see sprouting up all over the country today. Have we lost our mojo? Maybe a little bit. But, our job, I would say as MD5, is to try to build on that foundation. Rebuild some of the connections that may have atrophied over the years and I hope ignite a second high-tech revolution in the United States taking advantage of the national security enterprise as a catalyst.

[00:08:04] Scott Aughenbaugh: Many people in the United States are aware of the historical impact of the Department of Defense on technology like the internet, GPS, etc. What are some new examples of how they are impacted?

[00:08:14] Jay Harrison: Well, I will give a couple of different examples. One is the 38 individual patents that were underwritten to a greater or lesser extent by Department of Defense research and development dollars in the iPhone. So this thing that we have all come to rely on would not exist without those technologies that were developed and underwritten by DoD. Maybe a more recent example even than that is self-driving cars. You go to the West Coast and you look at all the self-driving car activity taking place and if you go to the folks who are doing the work, there is very little recognition that the early investments—the early interest, the early problem set, and early technology—for self-driving cars was something that came out of a DARPA challenge in the early mid-2000s, So, we are continuing to see the transfer of technology that starts off in the national security space over into the groundbreaking product development activities that are taking place in our high-tech communities of Boston, Austin, Silicon Valley, Boulder... to name a few. So, it’s still very much an active process not just a thing of the past.

[00:09:46] Scott Aughenbaugh: What is the MD5 mission set?

[00:09:48] Jay Harrison: So it’s interesting. I am going to reveal a little bit of nerdiness here—Dungeons and Dragons, the many sided die—I kind of think of the MD5 mission space as the D20. Depending upon where it lands, I can give you a different answer, but it’s all the same. There is continuity to it, it’s all consistent. 

I think the core of our mission set has to do with developing people. Developing innovators and human-centered networks that drive bottom-up innovation. So DoD historically has been really good at what I call corporate research and development. So identifying a hard technology problem, making the investments required to build that technology—over years in many cases—and then tying that technology to a specific mission. That’s how we do things, that’s how we roll in DoD.

What we're not particularly really good at is what I will call the emergent bottom-up type of innovation that we see creating a lot of value in the commercial world. And that is more about taking found items and taking found technology—things that may have been invented by other people—and finding the killer app. Finding the way to apply the technology to the right gap or to the right problem in a pretty risk mitigated way. Not investing a ton of money into defining that application. Not investing a ton of time learning from the feedback that the market can provide and then iterating, refining your value proposition. 

So, I would argue that—to the extent that there are so many sources of invention today—the technology, the fundamental technologies are sprouting up from more and more locations. DoD can no longer rely on having a monopoly on the technology and we certainly cannot rely on having a monopoly on applications. So our competitive advantage has a lot to do with the speed of aligning technology with our gaps, and with our problems. And again, that, until we build the global artificial intelligence brain that can do that for us, that is a people problem. That’s a heavy lift for people. We need to engage operators who have that insight into what’s going on in the problem domain and expose them to people who really understand the art of the possible in technology to identify those value creating applications. So, that I would say at the highest level is what MD5 is all about.

Now if you take it one step further—and I could probably keep doing this forever—but I will take it one step further. So the first derivative of that is going to be. So, you have identified the application of your great idea, so what? I have a great idea every time I take a shower in the morning. The trick becomes how do you create an institutional competence around building actionable concepts that our big programmatic monster of an organization can actually move forward? So a lot of what we do is instilling those competencies—the methodological tools—that allow the innovator to actually turn their idea into something that is executable. Something that’s actionable so that you can feed the beast. So that the bureaucracy can get its arms around it and actually move it forward.

[00:13:30] Scott Aughenbaugh: There are a number of groups in the Department of Defense along what I would describe as an innovation continuum. Where does MD5 fit alongside groups like the Strategic Capabilities Office or SCO, Rapid Equipping Force, Special Operations, DIUX, Defense Innovation Board, DARPA, etc?

[00:13:48] Jay Harrison: So one important difference again is that we're enablers. We're what I would call technology agnostic. We don’t care what your problem is and we don’t care what your potential technology solution is, our job is to develop people who are going to go out and find the problems and people who are going to go out and find the technology interventions that are relevant to those problems and then on their own—more or less—create a prototype or some type of early phase product that can be deployed in a real world operational context or a real world market. That’s unique as far as I can tell within DoD.

So the SCO, they’ve got missions or problem sets that focus on finding technologies to support. The Rapid Equipping Force in the Army, same thing. An organization that I used to run—back in the day—the technical operations support activity, that’s what we did. Special Operations Command Acquisition, that’s what they do. They find technologies to support specific problems. In our case, the problem discovery may be the most important part of the whole equation. So it’s finding people who are going to go out and characterize and frame the problems that we need to be actioning. And then connect and leverage the network to identify/prototype/develop potential solutions to those problems. So that’s what I mean by emergent, that’s what I mean by bottom-up. It is not the head shed saying that we need to go out and do X,Y, and Z, and then dumping money into it. Think about it, that is not how Silicon Valley works. Silicon Valley—you have got a bunch of students who are mixing around, who know something about technology. They experiment in the marketplace and then the venture capitalists sit back and they see where the value is that ultimately gets created and that's where they put their money.

In our case we're not making investments like that that. We are just creating the conditions around people, and access to resources, and access to networks, where that kind of activity can take place.

[00:15:59] Scott Aughenbaugh: There are three big portfolios at MD5: Education, collaboration, and acceleration. How do they fit what we do? Is it a pipeline?

[00:16:07] Jay Harrison: First of all, it is not a pipeline—at least that’s not how we view it—you don’t come in one end of the MD5 sausage grinder and spit out the other end. People can engage in any way that makes sense for them. Or that makes sense for their organization if it is an organizational partner that wants to engage us. The way I describe what we do is more of a toolbox. It’s a set of services. You can take advantage of a lot of the services or you can take advantage of one service.

So on the education side of things, it is more about development of people. And so providing the basic methodological tools—the classroom training, the experiential education type training—that allow and prepare individuals to engage in this bottom-up problem-solving type of activity. The best known program that we have in that portfolio is Hacking for Defense. Which teams up university-based teams with DoD agencies who are looking for potential technology solutions to specific issues that they may have. Something that is unique about that program is the fact that the education is on both sides of the coin. Yeah, the university students are getting something out of the educational experience. I would argue—perhaps even more importantly to DoD—the agency mentors and sponsors who we require to participate through the semester are gaining invaluable problem-framing expertise. Again, DoD has not cultivated this competence of identifying and framing problems enough within our workforce. Think about it, we literally outsource the problem-finding function to the J8, the G8, the A8, or the N8, there is an organization in the bureaucracy that does that. Nobody else has to think about problems. Hand it over to the bureau—you know the part of the bureaucracy that does that. Well, we need more of the people who are in the most direct exposure to the external world to really understand, how do you frame a problem. How do you find a problem? How do you shape it in a way that you can hand it off to someone else, an innovator, who might be working on a potential solution. So, again I would just say that the education cuts both ways with something like Hacking for Defense.  

An example in our next portfolio, collaboration. And what we do in collaboration is—let’s assume that in education we’re creating a cohort of people inside government and outside of government who are prepared to engage in collaborative bottom-up problem-solving type activity. Entrepreneurial-led innovation type of activity. In collaboration we’re actually providing opportunities for those networks to come together. Creating touch points where university students and military operators and agency employees get in the room and mix it up in a semi-structured problem-solving environment to come up with novel ideas and then we provide online tools that enable these communities to persist to conversation.

And then thirdly—and obviously all of these things are critical—the important part about our third portfolio acceleration is that, you know it's a feel good moment when a bunch of folks get together and get beer and pizza and great ideas and somebody wins and goes home, that’s not the point. The point is to translate these ideas into products, into things that we can experiment with and learn from and that's really what acceleration does. We work with the innovators and provide a little bit—I mean a really little bit—let’s say 15-50k worth of investment as well as access to things like DoD infrastructure or DoD personnel who can provide mentorship to accelerate the idea from something that is intangible to something that can be tested. 

[00:20:21] Scott Aughenbaugh: What early success story does not get enough attention?

[00:20:24] Jay Harrison: The one that I don’t think gets enough—even internal recognition—and so therefor I will use this as an opportunity to talk about it is the one that we did with Relativity Space. So MD5 has been engaged with a really early stage project we call Fulcrum, which is working with Y Combinator portfolio companies, Y Combinator being one of the largest and most well-known and most successful accelerators on the West Coast. Working with Y Combinator portfolio companies who are developing products relevant to national security missions and then providing those companies with unique access to DoD laboratory infrastructure that support the development objectives for their products. So, part of the reason that we do this obviously is to increase DoD’s visibility and insight into a product that we can potentially be leveraging for our missions. The other thing that's equally important, that by inviting these innovative early stage startups into DoD laboratories, we're enriching the exposure of DoD scientists and engineers to some emerging technologies that they need to be aware of and they need to be working with. So, it provides not only a technology type of advantage for DoD, it also provides this human capital workforce development advantage for our laboratory personnel.

So in the case of Relativity Space, working through MD5, we were able to open up some pretty unique infrastructure to them that they otherwise would not have had access to. And I should say this company is building a 12 thousand pound, liquid-fueled, 3d printed, rocket engine, so 3D printed makes it really cost-effective and flexible from a manufacturing standpoint. Ahh but, you can’t test a 12 thousand pound, liquid-fueled rocket in your backyard. You have all these considerations related to instrumentation, related to infrastructure, related to fire suppression, related to noise-abatement, related to zoning restrictions. It's a not an easy lift for a startup to address all these considerations. And I think at the end of the day we projected by making the DoD rocket testing infrastructure available to this startup we saved them over 2 million dollars of costs that they would have otherwise had to ask their investors to cover.

And we did that, in effect, without having to invest any of DoD’s money. It was making infrastructure that was available, accessible to this startup. DoD secured all the data from the testing in a proprietary way—we're not making that data available to other people. We're now familiar with the technology and can make decisions as to whether this is a technology that we want to work with this company to leverage in the future. So, I think too much of the argument up to this point around how DoD attracts startups to do business with us has focused on how do we make our contracts easier for startups to use. I think that may in fact be the least interesting opportunity that we can represent to a startup. I think a more interesting opportunity is how do we make all this technology—how do we make all this infrastructure—available to these early stage startups or entrepreneurs, so they come in our network in a semi-permanent kind of way and we can work with them throughout their careers. It’s not transactional, again, it’s more of a longer-term type relationship that we hope to build through programs like this. 

[00:24:30] Scott Aughenbaugh: Thank you for listening to this podcast with Jay Harrison, the director of MD5. You can follow him on twitter at @ARE5 and for more information please visit