Defense Department Remakes Silicon Valley Enterprise

May 12, 2016
By Robert K. Ackerman
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Boston is added to its high-technology outreach efforts.

The Defense Department’s attempt to incorporate Silicon Valley innovation now is entering its second phase, which is defined by major organizational changes. The Defense Innovation Unit-Experimental, or DIUx, that was established in the California technology hub last year will be joined by an equivalent office in Boston as part of a new nationwide thrust. Known as DIUx 2.0, this new approach will feature broader focus and expanding funding.

Defense Secretary Ash Carter, who was a prime mover in establishing DIUx 1.0 in Silicon Valley, announced, “We’re not just iterating, we’re scaling,” in describing version 2.0’s national nature. The new innovation hub in Boston is an example of that expanded outreach.

The second key feature is DIUx’s “processing power,” Carter offered. The new $30 million funding the department requested for fiscal year 2017 aimed at non-traditional companies may just be a starting point when added to co-investment from the military services, he added. This funding will be complemented by merit-based prize competitions, incubator partnerships and targeted research and development efforts.

Carter describes the third new feature as an “operating system upgrade.” With a broader mission, the organization is being equipped with a partnership-style leadership structure that comprises technologists, investors and business executives. These four people will be joined by a team of reservists led by Cmdr. Doug Beck, USNR, who also is Apple’s vice president for the Americas and Northeast Asia.

Carter emphasizes DIUx 2.0 will report directly to him, and it will work in close coordination with Deputy Secretary of Defense Robert Work and the vice chairman of the Joint Chiefs, Gen. Paul Selva, USAF. The new architecture will be geared to speeding innovation into the military.

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