Small Businesses Should Choose Defense.

• Author: Boozer, Jim
• Position: NDIN Perspective

* Why would a small business innovator choose to participate in the defense sector?

If you are a small business developing dual-use technology --a product that can be used in both defense and commercial environments--there are three compelling reasons why you may want to develop your product within the defense marketplace.

The first and perhaps most important reason is innovation. The culture of cutting edge innovation is inherent to the government research-and-development strategy. While many commentators and experts point to disruptive innovation within America's commercial sector, the commercial world has a need to know where the profit will come from prior to significant investment in new ideas and products.

If decision makers don't see a clear path to profit, they will cut their losses and move onto an idea or product with more certain marketability.

The Pentagon--on the other hand--boasts R&D leaders with a strong tolerance for risk. They will take investment risks in early technology readiness level programs if they believe the innovation may deliver strategic or operational advantage to U.S. warfighters. In conflict, better capabilities operated by well-trained troops play an enormous role in reducing operational risk, and therefore Defense Department leaders will always trade higher investment risk to reduce operational risk to U.S. and allied forces.

For these reasons, government R&D funding provides businesses with resources and a viable way to explore innovations for which a purely commercial business model--bootstrapped and customer financed--does not provide.

The Defense Department's commitment to innovation is driven by an underlying willingness to push the envelope to deliver decisive advantage across the spectrum of conflict. This commitment requires effective communication with the department's "board of directors"--Congress--to ensure elected representatives share the Pentagon's vision for pursuing promising high-value technology.

Second, small businesses operating in defense are given access to the world's most committed and engaged end users. These end users, the women and men who volunteer to serve our nation, have unique needs dictated by rigorous demands of their everyday work. The rigor and mission critical demands of the defense marketplace are what enables companies to shape and deliver meaningful and successful technology.

As frontline workers have an exceptionally high interest in ensuring they can successfully...