Steve Blank Innovation and Entrepreneurship

Time 2021-06-14 20:57:28

Web Name: Steve Blank Innovation and Entrepreneurship

WebSite: http://steveblank.com

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We just finished our 6th annual Hacking for Defense class at Stanford.What a year. With the pandemic winding down it finally feels like the beginning of the end.This was my sixth time teaching a virtual class during the lockdown – and for our students likely their 15th or more. Hacking for Defense has teams of students working to understand and solve national security problems. Although the class was run completely online, and even though they were suffering from Zoom fatigue, the 10 teams of 42 students collectively interviewed 1,142 beneficiaries, stakeholders, requirements writers, program managers, industry partners, etc. while simultaneously building a series of minimal viable products.At the end of the quarter, each of the teams gave a final “Lessons Learned” presentation. Unlike traditional demo days or Shark Tanks which are, “Here’s how smart I am, and isn’t this a great product, please give me money,” a Lessons Learned presentation tells the story of a team’s 10-week journey and hard-won learning and discovery. For all of them it’s a roller coaster narrative describing what happens when you discover that everything you thought you knew on day one was wrong and how they eventually got it right.Here’s how they did it and what they delivered.How Do You Get Out of the Building When You Can t Get Out of the Building?This class is built on conducting in-person of interviews with customers/ beneficiaries and stakeholders, but due to the pandemic, teams now had to do all their customer discovery via a computer screen. This would seem to be a fatal stake through the heart of the class. How would customer interviews work via video?  After teaching remotely for the last year, we’ve learned that customer discovery is actually more efficient using video conferencing. It increased the number of interviews the students were able to do each week.Many of the people the students needed to talk to were sheltering at home, which meant they weren’t surrounded by gatekeepers. While the students missed gaining the context of standing on a navy ship or visiting a drone control station or watching someone try their app or hardware, the teaching team’s assessment was that remote interviews were more than an adequate substitute. When Covid restrictions are over, we plan to add remote customer discovery to the students’ toolkit. (See here for an extended discussion of remote customer discovery.)We Changed The Class FormatWhile teaching remotely we made two major changes to the class. Previously, each of the teams presented a weekly ten-minute summary consisting of here’s what we thought, here’s what we did, here’s what we found, here’s what we’re going to do next week.  While we kept that cadence, it was too exhausting for all the other teams to stare at their screen watching every other team present. So we split the weekly student presentations into thirds – three teams presented to the entire class then three teams each went into two Zoom breakout rooms. During the quarter we rotated the teams and instructors through the main room and breakout sessions.The second change was the addition of alumni guest speakers – students who had taken the class in the past. They offered insights about what they got right and wrong and what they wished they had known.Lessons Learned Presentation FormatFor the final Lessons Learned presentation many of the eight teams presented a 2-minute video to provide context about their problem. This was followed by an 8-minute slide presentation describing their customer discovery journey over the 10 weeks. While all the teams used the Mission Model Canvas, (videos here), Customer Development and Agile Engineering to build Minimal Viable Products, each of their journeys was unique.By the end the class all the teams realized that the problem as given by the sponsor had morphed into something bigger, deeper and much more interesting.All the presentations are worth a watch.Team Fleetwise – Vehicle Fleet ManagementIf you can’t see the Fleetwise 2-minute video, click hereIf you can’t see the Fleetwise slides, click hereMission-Driven EntrepreneurshipThis class is part of a bigger idea – Mission-Driven Entrepreneurship. Instead of students or faculty coming in with their own ideas, we ask them to work on societal problems, whether they’re problems for the State Department or the Department of Defense or non-profits/NGOs  or the Oceans and Climate or for anything the students are passionate about. The trick is we use the same Lean LaunchPad / I-Corps curriculum — and the same class structure – experiential, hands-on driven this time by a mission-model not a business model. (The National Science Foundation, National Security Agency and the Common Mission Project have helped promote the expansion of the methodology worldwide.)Mission-driven entrepreneurship is the answer to students who say, “I want to give back. I want to make my community, country or world a better place, while being challenged to solve some of the toughest problems.”Project Agrippa – Logistics and Sustainment in IndoPacificIf you can’t see the Project Agrippa 2-minute video, click hereIf you can’t see the Project Agrippa slides, click hereIt Started With An IdeaHacking for Defense has its origins in the Lean LaunchPad class I first taught at Stanford in 2011. I observed that teaching case studies and/or how to write a business plan as a capstone entrepreneurship class didn’t match the hands-on chaos of a startup. Furthermore, there was no entrepreneurship class that combined experiential learning with the Lean methodology. Our goal was to teach both theory and practice.The same year we started the class, it was adopted by the National Science Foundation to train Principal Investigators who wanted to get a federal grant for commercializing their science (an SBIR grant.) The NSF observed, “The class is the scientific method for entrepreneurship. Scientists understand hypothesis testing” and relabeled the class as the NSF I-Corps (Innovation Corps). The class is now taught in 9 regional locations supporting 98 universities and has trained over 1500 science teams. It was adopted by the National Institutes of Health as I-Corps at NIH in 2014 and at the National Security Agency in 2015.Team Silknet – Detecting Ground Base ThreatsIf you can’t see the Silknet 2-minute video, click hereIf you can’t see the Silknet slides, click hereOrigins Of Hacking For DefenseIn 2016, brainstorming with Pete Newell of BMNT and Joe Felter at Stanford, we observed that students in our research universities had little connection to the problems their government was trying to solve or the larger issues civil society was grappling with. As we thought about how we could get students engaged, we realized the same Lean LaunchPad/I-Corps class would provide a framework to do so. That year we launched both Hacking for Defense and Hacking for Diplomacy (with Professor Jeremy Weinstein and the State Department) at Stanford.Team Flexible Fingerprints – Improve CybersecurityIf you can’t see the Flexible Fingerprints 2-minute video, click hereIf you can’t see the Flexible Fingerprints slides, click hereGoals for the Hacking for Defense ClassOur primary goal was to teach students Lean Innovation while they engaged in national public service. Today if college students want to give back to their country, they think of Teach for America, the Peace Corps, or AmeriCorps or perhaps the US Digital Service or the GSA’s 18F. Few consider opportunities to make the world safer with the Department of Defense, Intelligence community or other government agencies.In the class we saw that students could learn about the nation’s threats and security challenges while working with innovators inside the DoD and Intelligence Community. At the same time the experience would introduce to the sponsors, who are innovators inside the Department of Defense (DOD) and Intelligence Community (IC), a methodology that could help them understand and better respond to rapidly evolving threats. We wanted to show that if we could get teams to rapidly discover the real problems in the field using Lean methods, and only then articulate the requirements to solve them, defense acquisition programs could operate at speed and urgency and deliver timely and needed solutions.Finally, we wanted to familiarize students with the military as a profession and help the better understand its expertise, and its proper role in society. We hoped it would also show our sponsors in the Department of Defense and Intelligence community that civilian students can make a meaningful contribution to problem understanding and rapid prototyping of solutions to real-world problems.Team Neurosmart   Optimizing Performance of Special OperatorsIf you can’t see the Neurosmart 2-minute video, click hereIf you can’t see the Neurosmart slides, click hereMission-Driven in 50 Universities and Continuing to Expand in Scope and ReachWhat started as a class is now a movement.From its beginning with our Stanford class, Hacking for Defense is now offered in over 50 universities in the U.S., as well as in the UK and Australia. Steve Weinstein started Hacking for Impact (Non-Profits) and Hacking for Local (Oakland) at U.C. Berkeley, and Hacking for Oceans at both Scripps and UC Santa Cruz.  Hacking for Homeland Security launched last year at the Colorado School of Mines and Carnegie Mellon University. A version for NASA is coming up next.And to help businesses recover from the pandemic, the teaching team taught a series of Hacking For Recovery classes last summer.Our Hacking for Defense team continues to look for opportunities to adapt and apply the course methodology for broader impact and public good. Project Agrippa, for example, piloted a new “Hacking for Strategy” initiative inspired by their experience in Stanford’s “Technology, Innovation and Modern War” class that Raj Shah, Joe Felter and I taught last fall. This all-star team of 4 undergraduates and a JD/MBA developed new ways to provide logistical support to maritime forces in the Indo-Pacific region. Their recommendations drew on insights gleaned from over 242! interviews (a national H4D class record.) After in-person briefings to Marine Corps and Navy commanders and staff across major commands from California to Hawaii, they received interest in establishing a future collaboration, validating our hypothesis that Hacking for Strategy would be a welcome addition to our course offerings. Its premise is that keeping America safe not only requires us maintaining a technological edge but also using these cutting edge technologies to develop new operational concepts and strategies. Stay tuned.Team AngelComms – Rescuing Downed PilotsIf you can’t see the AngelComms 2-minute video, click hereIf you can’t see the AngelComms slides, click hereTeam Salus – Patching Operational Systems to Keep them SecureIf you can’t see the Salus 2-minute video, click hereIf you can’t see the Salus slides, click hereTeam Mongoose – Tracking Hackers Disposable InfrastructureIf you can’t see the Mongoose 2-minute video, click hereIf you can’t see the Mongoose slides, click hereTeam Engage – Preparing Aviators to Make Critical High Stakes DecisionsIf you can’t see the Engage slides, click hereWhat s Next For These Teams?When they graduate, the Stanford students on these teams have the pick of jobs in startups, companies, and consulting firms. Most are applying to H4X Labs, an accelerator focused on building dual-use companies that sell to both the government and commercial firms. Many will continue to work with their problem sponsor. Several will join the new Stanford Gordian Knot Center which is focused on the intersection of policy, operational concepts, and technology.In our post class survey 86% of the students said that the class had impact on their immediate next steps in their career. Over 75% said it changed their opinion of working with the Department of Defense and other USG organizations.It Takes A VillageWhile I authored this blog post, this class is a team project. The secret sauce of the success of Hacking for Defense at Stanford is the extraordinary group of dedicated volunteers supporting our students in so many critical ways.The teaching team consisted of myself and:Pete Newell, retired Army Colonel and ex Director of the Army’s Rapid Equipping Force, now CEO of BMNT.Joe Felter, retired Army Colonel; and former deputy assistant secretary of defense for South Asia, Southeast Asia, and Oceania; and William J. Perry Fellow at Stanford’s Center for International Security and Cooperation.Steve Weinstein, 30-year veteran of Silicon Valley technology companies and Hollywood media companies. Steve was CEO of MovieLabs, the joint R D lab of all the major motion picture studios. He runs H4X Labs.Tom Bedecarré, the founder and CEO of AKQA, the leading digital advertising agency.Jeff Decker, a Stanford researcher focusing on dual-use research. Jeff served in the U.S. Army as a special operations light infantry squad leader in Iraq and Afghanistan.Our teaching assistants this year were Nick Mirda, Sally Eagen, Joel Johnson, past graduates of Hacking for Defense, and Valeria Rincon. A special thanks to the National Security Innovation Network (NSIN) and Rich Carlin and the Office of Naval Research for supporting the program at Stanford and across the country, as well as Lockheed Martin and Northrop Grumman. And our course advisor, Tom Byers, Professor of Engineering and Faculty Director, STVP.Thanks to Mike Brown, Director of the Defense Innovation Unit for giving an extraordinary closing keynote.We were lucky to get a team of mentors (VCs and entrepreneurs) as well as an extraordinary force of military liaisons from the Hoover Institution’s National Security Affairs Fellows program, Stanford senior military fellowship program and other accomplished military affiliated volunteers. This diverse group of experienced experts selflessly volunteer their time to help coach the teams. Thanks to Todd Basche, Rafi Holtzman, Kevin Ray, Craig Seidel, Katie Tobin, Jennifer Quarrie, Jason Chen, Matt Fante, Richard Tippitt, Rich Lawson, Commander Jack Sounders, Mike Hoeschele, Donnie Hasseltine, Steve Skipper, LTC Jim Wiese, Col. Denny Davis, Commander Jeff Vanak, Marco Romani, Rachel Costello, LtCol Kenny Del Mazo, Don Peppers, Mark Wilson and LTC Ed CuevasAnd of course a big shout-out to our problem sponsors across the DoD and IC: MSgt Ashley McCarthy, Jason Stack, Col Sean Heidgerken, LTC Richard Barnes, George Huber, Neal Ziring, Shane Williams, Anthony Ries, Russell Hoffing, Javier Garcia, Matt Correa, Shawn Walsh, and Claudia Quigley.Share this:PrintEmailTweetWhatsAppTelegramShare on TumblrPocketLike this:Like Loading... Filed under: Hacking For Defense Leave a comment I was pleasantly surprised to hear from Suresh, an ex-student I’ve known for a long time. A U.S. citizen he was now the head of sales and marketing for a company in London selling medical devices to hospitals in the UK National Health Service.  His boss had identified the U.S. as their next market and wanted him to set up a U.S. salesforce. Suresh understood that the U.S. health system was very different from the system in the UK, not just the regulatory regime through the FDA, but the reimbursement process and the entire sales process.Over a Zoom call Suresh explained, “I m trying to push the importance of running customer discovery and testing these hypotheses before we build our U.S. product, but I’m running into a pushback from my CEO. He says, We re disruptors! Discovery is going to slow us down.  We need to move quickly! Suresh was concerned. “If we don t test our assumptions about the market and any changes needed to our products, we ll build something I can t sell. Worse, given how expensive clinical trials are in medtech, I m concerned if we build a product that isn t commercially viable, we ll be out of business before we even start.”I could hear his frustration and concern when he asked, “How can I convince my boss to use customer discovery to test our hypotheses?”That’s when I realized that Suresh was overlooking a few things.He was trying to sell the story of Customer Discovery as part of the Lean Methodology to his CEO by explaining how discovery worked with the business model canvas, agile engineering, pivots and MVPs.But talking about the method to others is not the same as doing Customer Discovery.Customer Discovery is about gathering validated evidence, not proselytizing a method.The goal of discovery is to gather evidence to test hypotheses, deeply understand the customer problem and validate a solution.As head of sales and marketing, Suresh didn’t need his CEO to buy into the process or give his permission to start the discovery process. He was in charge.Given the ubiquity of Zoom, he could use it to rapidly get out of the building to the U.S. to test some hypotheses and gather some initial insights.I pointed out that once he had potential customer, regulator, and reimbursement data from his Discovery interviews, he could bring that data into conversations with his CEO.Having real data turns conversations from faith-based to evidence-based.Lessons LearnedTalking about the Lean method to others is not the same as doing itIf you’re in charge or part of a customer-facing organization, you don’t need to wait for permission to talk to customers to test hypothesesHaving real data turns conversations from faith-based to evidence-based There are no facts inside your building, so get the heck outsideI just had a call with Lorenz, a former business school student who started a job at a biotech startup making bacteria to take CO2 out of the air. His job was to find new commercial markets for this bacteria at scale.  And he wanted to chat about how to best enter a new market.His market research found that the concrete industry contributes between 5 and 10% of the world’s carbon emissions. So it seemed logical to him that the concrete industry was going to be one the first places to approach since it was obvious that they need to reduce carbon emissions. He believed that if used as an additive to concrete, his bacteria could strengthen it while reducing CO2.The conversation got interesting when I asked, “How are you going to describe the product to potential customers in the concrete industry?” Lorenz began a long description of the details of the bacteria, his founders’ research papers on bacteria, the scientific advisory board bacteria experts they had assembled, how the bacteria was made at scale in fluidized bed reactors, etc… This went on for at least ten more minutes. When he was done I asked him, “So why should anybody in the concrete industry care? Do you really think they’re looking for bacteria made in fluidized bed reactors? Do you think there are a significant number whose number one issue is to buy bacteria? Do you know what if any of the features you mentioned actually matter to a potential customer?” There was silence for a moment. And then he said, “I don’t know.”I wasn’t completely surprised because as a young marketeer, I made this mistake all the time – thinking that my product was a solution to someone’s problem  without ever understanding what problems the customers really had. And that I needed to have all the answers when in fact I didn’t even understand the questions.I suggested that perhaps he should get out of the building and actually talk to some large-scale concrete suppliers and rather than starting with what he wanted to sell them, try to understand what their needs were. For example, how were current and upcoming green building regulations on CO2 emissions affecting the concrete industry? How are they solving that problem today? (If they weren’t solving it, it may not be a problem they’ll pay to solve.) What was the current cost of low carbon concrete? How much would they have to charge to be competitive? Were there specific use-cases that made sense for initial adoption/pilots? What additional benefits could bacteria as an concrete additive make (ie. greater strength, crack healing)?We talked for a few minutes more and by then I could see the lightbulb going on over his head when he said, “I think I got my work cut out for me.”Lessons learnedYour product is not someone’s problemStart with a deep understanding of a customer problem or need before you start pitching your solutionAsk customers how they solve the problem todayUnderstand future regulations that might change your customer’s priorities or challenges Register HereIn 2020 over 1,000 educators joined us online to learn and share how to teach during the pandemic. Now we’re heading back into the classroom and the world has changed. What is the “new normal” for Lean Education? Will using video to “get out of the building” still play a role? What roles do diversity, equity and inclusion play in future syllabi?Join me, our guest speaker Dr. Laura Tyson, our panelists Brandy Nagel, Ivy Shultz, Michael Camp and Jim Hornthal and hosts Jerry Engel, Pete Newell, Steve Weinstein and your peers for a robust discussion to these questions at the 4th edition ofLean Innovation Educators Summiton June 3rd, 1 – 4pm EDT,10am 1pm PDT.WhyThe Pandemic has changed everything. After a year plus in the virtual teaching environment how much will stick and what will return to pre-pandemic norms? How much of our virtual “getting out of the classroom” teaching methods will remain? The business landscape crippled some industries while others have exploded. Which ones will rebound? The funding environment for our students continues to be on fire. Will that continue? How will the push for diversity, equity and inclusion affect educators?WhatThe event will begin with a fireside chat with Dr. Laura Tyson former Dean of the Berkeley Haas School of Business and former Chairman of the National Economic Council. The respondent panel will include, Brandy Nagel (Georgia Tech), and Ivy Shultz (Columbia University), Michael Camp (Ohio State), Jim Hornthal (UC Berkeley). To learn from each other and share ideas, we’ll then go into breakout sessions so you can discuss the topics from the fireside chat and share best practices with your peer Lean educators from around the world.HowThis session isfreeto all but limited to Innovation educators.You can register for the eventhereand/or learn more on ourwebsite. We look forward to gathering as a community of educators to shape the future of Lean Innovation Education.WhenSee you on June 3rd 1pm – 4pm EDT, 10am-1pm PDT.Bring your best ideas!RegisterhereShare this:PrintEmailTweetWhatsAppTelegramShare on TumblrPocketLike this:Like Loading... Filed under: Educators Summit 1 Comment As Director of the U.S. Army s Rapid Equipping Force Pete Newell delivered innovation at speed and scale in the Department of Defense. Pete is now CEO of BMNT, a company that delivers innovation solutions and processes for governments.Here are Pete s 5 principles that will accelerate innovation.To help a large Defense organization wrestle with how to increase the velocity of innovation in their ranks Steve Blank and I spent the better part of last week with our heads together reviewing everything we learned in the five years since we merged the concepts of problem curation and Lean while launching the innovation pipeline.The original Innovation Pipeline sketch 2016I spent yesterday sifting through the most recent lessons learned and results from a series of accelerators BMNT is running for the intelligence community. Then last night I watched the final presentations from the inaugural Hacking for National Security course in Australia before jumping over to teach Stanford’s Hacking for Defense® (H4D) class.Looking back on the week I’m blown away by how far we’ve come since we merged the two methodologies five years ago and by how fast we are discovering the pathways toward solving incredibly hard problems. Some examples:In less than six weeks a Stanford H4D team has redefined a problem related to security vetting and radicalization while also describing the pathway a solution could follow to deployment within the Department of Defense and the Intelligence Community.A Navy team recently sourced 80 problems, then curated down to one priority problem to solve. In less than 60 days they created 26 MVPs while interviewing over two dozen companies. They then incubated and delivered a solution that will help get large vessels back to sea faster, potentially saving the Navy $20M-$30M a year.In just three weeks, the DIA MARS team sourced 100 problems from nearly 400 people, then curated and selected five priority problems to focus on. In eight weeks, five teams conducted more than 125 interviews (across 53 stakeholder organizations) and 12 experiments to deliver five validated proofs-of-concept and the evidence needed to confidently invest resources to prototype three of the five based on their user desirability, technical feasibility and organizational viability.What I observed from the week’s deep dive: Whether it is an agency cross-functional team or a university-based “Hacking for” team we are accelerating, five key concepts drive the foundation for this increasing pace of learning and solution delivery. They areThe power of Lean Methodology is supercharged when discovery begins with a well-curated and prioritized problem. Getting to one well-curated problem requires access to a source of hundreds of them.   Problem curation doesn’t stop until discovery is complete the process of trying to discover the solution to a problem helps define the actual problem (and for .gov folks the actual requirement for the future solution).Stakeholder mapping and nailing the value propositions for beneficiaries, buyers, supporters, advocates and potential saboteurs are critical to building a pathway through the phases of the innovation pipeline and transitioning a solution to deployment. The key to understanding value propositions is in building interviews that are based on a set of hypotheses (about the problem, the stakeholder and potential solutions to be explored) and data to be captured while using minimum viable products (just enough “product” to increase the efficacy of a conversation and increase the speed of learning).Innovation happens because of people and it takes a village. Whether academic-based like our Hacking for Defense teams or internal organizational Integrated Product or Cross-Functional Teams (IPTs/CFTs), accelerator teams perform best when supported by:Teachers who can ground teams in a common framework and language for the discipline of innovation and entrepreneurship.Coaches who can walk teams through the practical application of innovation tools in context with the problem they are trying to solve.Mentors who will provide relentlessly direct feedback to teams and challenge them on the quality of the hypotheses, MVPs and the analysis of what they’ve learned, while driving them through each pivot rather than letting them get bogged down in “analysis paralysis.”Advisors who will provide alternative viewpoints that will enable teams to see clearer pathways through bureaucracies.Connectors who will help teams rapidly grow their networks to gain new insights from unique partners not yet discovered. The U.S. Department of Defense is coming to grips with the idea that the technologies it needs to keep the country safe and secure are no longer exclusively owned by the military or its prime contractors. AI, machine learning, autonomy, cyber, quantum, access to space, semiconductors, biotech are all being driven by commercial companies.  At the front-end of these innovations are startups organizations the Department of Defense hasn t previously dealt with at scale.They re now learning how.Mrinal Menon is one of my Hacking for Defense students at Stanford where he s currently in the MBA program. He s a former U.S. Navy Surface Warfare Officer. Jeff Decker is a co-instructor of the Hacking for Defense class and the Stanford program director. Jeff is an Army Second Ranger Battalion veteran.Mrinal and Jeff s article below explains how startups can adapt and thrive while working with the Defense Department. And how the Department of Defense is learning to work with startups.This article previously appeared in Fast Company.At a time when young companies struggle to find technology sectors not dominated by Silicon Valley’s giants, most startups remain oblivious to one of the largest markets in the world, the U.S. Defense Department. The military awarded $445 billion in contracts in 2020. By comparison, last year’s global market for software-as-a-service, one of the hottest sectors for startup creation and investment, was estimated at $104 billion.There’s a willing market here, too. The Pentagon is eager for help from the nation’s innovators. The military is clamoring for cutting-edge technologies in areas like artificial intelligence, machine learning, and autonomy. To attract interest the Defense Department is handing out unprecedented numbers of small contracts and in 2020 seeded 1,635 firms with more than $1.5 billion in early funding. Dozens of outreach programs across the military now offer quick revenue to early-stage companies. A startup could land a contract worth up to $3 million within months of entering the defense market.This emerging opportunity reflects the urgency of keeping pace with rivals like China and Russia, who are furiously integratingcommercial technologies like AI, quantum computing, and unmanned systems into their armed forces. If former Google CEO Eric Schmidt’s prediction about China overtaking the United States in AI comes to pass, the People’s Liberation Army could be better prepared than the U.S. military for future conflicts in which cyberattacks and drone swarms play a larger role than warships and fighter jets. Without adopting cutting-edge commercial technologies, the U.S. military may be rendered obsolete.Yet, for every newly minted success like Palantir or Anduril, thousands of companies struggle to find follow-on opportunities after receiving early innovation contracts. Historically, more than 80% of new entrants exit the defense market before they have a chance to see recurring revenue. Anduril founder Palmer Luckey has sardonically noted that the only defense companies to reach unicorn status in the past 30 years have all been founded by billionaires able to endure long gaps in funding. To truly compete with technologically advanced rivals, the Defense Department will ultimately need to enable a broad pool of innovative founders to succeed. Until this ecosystem materializes, however, building a successful defense business is likely to take years of grueling effort. Before committing to work with the military, startups must look past the allure of early money and carefully assess whether the defense market is right for them.The Key Questions For StartupDespite the Pentagon’s newfound enthusiasm for innovation, startups in the defense market continue to encounter longstanding obstacles. Most companies face uncertainty when trying to bridge prototyping awards with more permanent follow-on contracts. Startups that successfully fulfill innovation contracts don’t automatically scale. Instead, their solutions must still compete for funding in a formal budgeting and acquisition process before being eligible for widespread adoption . This ordeal takes two years or more, during which startups should anticipate little or no revenue as they try to push their product through the bureaucracy.While earning the first $1 million in the defense market can be relatively easy, landing the next $10 million is extremely difficult. Before committing to work with the military, startups should carefully consider whether the defense market is right for them by asking three questions.Is there strong interest for the product?Those that offer solutions to high-priority problems have the best chance of sourcing funding and follow-on awards. Startups should assess how well their technologies align with the needs outlined in the defense budget, various modernization strategies, and problems posed by defense innovation hubs. For example, “flying taxi” startup Joby Aviation aligned its electric vertical takeoff and landing aircraft with the Air Force’s stated interest in advancing the market for air mobility vehicles. The 3D mapping company Hivemapper found traction with the Army by targeting its need to autonomously resupply field artillery units.Is the company prepared to endure revenue gaps?As noted, companies may go years without defense revenue while trying to bridge early contracts with larger opportunities. During this period, startups will need to sustain business development activities and may incur additional regulatory and compliance costs to ensure their product is usable by the military. Investors are also likely to express impatience with the long timelines of defense sales. The best prepared companies can either raise sufficient funds to keep operating or count on revenue from other sources. Palmer Luckey’s Anduril has aggressively pursued financingto sustain growth. Recently public enterprise-AI firm C3.ai entered the defense market having already built a successful commercial business in the energy vertical. Similarly, 3D-printing homebuilder Icon’s technologies have applications that extend well beyond national security use cases to commercial housing markets.Can I balance the needs of my defense and commercial customers?The best-positioned startups solve fundamentally similar problems for both military and commercial users. Satellite imagery firm Orbital Insight’s Go platform, for example, automates imagery analysis for defense analysts, investors, and agribusiness alike. Some amount of customization is inevitable given that military users often have specific mission requirements or technical constraints. However, companies that can serve military customers without fundamentally altering their existing product roadmap are likely to be most successful.Incidents like Google’s withdrawal from Project Maven have highlighted the potential for conflict when commercial companies decide to work with the military. This tension tends to be lower at startups where an early team willingly signs on to pursue defense business. Regardless, companies should be mindful of the reputational impacts working with the DoD could have on their existing business.The Case for OptimismCompanies eyeing the defense market have reason to be optimistic. There are a growing number of efforts to remove obstacles to partnerships between high-tech startups and the military. For example, the Air Force last year created the Strategic Financing (STRATFI) program. STRATFI provides the Air Force’s most promising commercial innovators, a list which includes Icon and Orbital Insight, quick access to large contracts worth up to $15M. Another positive sign is President Biden’s nomination of former Symantec CEO Mike Brown to oversee the Pentagon’s purchases of new technologies. As director of the Defense Innovation Unit (DIU), Brown has spearheaded investments in commercial technologies and helped C3.ai, Joby Aviation, and other Silicon Valley standouts navigate funding gaps. If confirmed, Brown could accelerate much needed reforms to military acquisition processes.A startup that makes it through the hurdles may find a massive market with a stable set of customers eager for better technology solutions. The U.S. government pays its bills on time, defense budgets are shielded from short-term volatility, and contracts may be guaranteed for multiple years. Once onboarded, military users can quickly become long-term customers given the challenges involved with switching to another product.Share this:PrintEmailTweetWhatsAppTelegramShare on TumblrPocketLike this:Like Loading... Filed under: National Security 1 Comment I first met Shawn Carolan and his wife Jennifer at the turn of the century at 11,000 feet. I was hiking with my kids between the Yosemite High Sierra camps. Having just retired from a career as an entrepreneur I had started thinking about why startups were different from large companies. The ideas were bouncing around my head so hard that I shared them with these strangers around a campfire, drawing out the four steps with a stick in the dirt. Shawn immediately said the name I had given the four steps was confusing I had called it market development he suggested that I call it Customer Development and the name stuck. What I didn t realize was that both were graduate students at Stanford and later both would become great VCs Shawn at Menlo Ventures and Jennifer at Reach Capital. (And Jennifer is now my co-instructor in the Stanford Lean LaunchPad class.)The MVP TreeOver the last two decades Shawn has seen hundreds of startups use the Lean Methodology. Many of them get hung up on understanding how to select the right minimal viable product. He came up with the concept to simply the search for product/market fit by using an MVP Tree.Shawns guest blog post describing describing the MVP Tree is below.(Note that if you re familiar with the business model canvas, Steps 1-4 below are equivalent to a visual map of the choices a founder makes as they develop a business model canvas. Step 5 and 6 leads you to selecting the right MVPs.)It’s commonly believed that the top two reasons startups fail is because “there’s no market need” and “they ran out of cash.”  These reasons are mental gymnastics to avoid a plain truth: startups fail when they don’t build a simple solution to a problem many people have.Many startups fall into the trap of building toward a “mission” rather than a minimum viable product (MVP).Your mission is your baby. It’s the North Star that got your people on board and inspires them daily. However, solely focusing on your mission is the same as being unfocused.Bridging the gap between a big, ambitious dream and the reality of what you can accomplish with limited resources isn’t fun because it requires saying no (for now) to a lot of things that have you excited. Paradoxically, resource limitations are the secret to success; they teach lessons that experienced entrepreneurs have harnessed. Constraints force you to pause—or even permanently shelve—certain aspects of your mission in favor of proving that you can deliver one specific thing that really matters to customers.During the crucial mission-to-MVP planning phase, the objective of a startup is to solve one job for one customer group such that customers consistently use your minimally viable product for an important part of their work or personal lives. In other words, you prove retention. It’s really all that matters at the earliest stage.The tool for doing this efficiently and effectively? We call it an MVP tree.Solution: Build an MVP TreeCompany missions tend to fall to the extremes: either the mission isn’t ambitious enough or it’s too ambitious to build with your current resources.It bears repeating: an early-stage startup must focus on making one customer group excited by a mission-aligned product. Doing so is usually a long way away from realizing your full mission statement, and that’s okay.An MVP tree is a way of methodically breaking your mission into smaller components and formulating MVP candidates that may get your company sustainable and scalable. Using the tree structure outlined below increases the chance that your first step forward (the MVP) will be successful with a small team, while taking you in the right direction to achieve your company s big mission. An MVP tree has three main components—customer archetypes, jobs to be done, and execution—and we’ll walk you through them step by step with a case study of Roku, a former portfolio company we’ve been fortunate to see execute from a $20 million first VC round to what is now a $50 billion public company.(To get started, we draw our tree out using Whimsical, a product that I’m a big fan of.)Step 1: Define Your Big Mission in a Simple StatementIn the day-to-day fray of prioritizing features, considering customer input, and handling people issues, it’s easy for a team to lose their bearings. The world is full of great products and it’s essential to be crystal clear on your reason for being; to avoid wandering in circles, you need a mission statement. A few examples:Roku: “To be the TV streaming platform that connects the entire TV ecosystem around the world”Your mission statement needs to stand for something specific and impactful. It may change as you build and learn from your customers, but aim for it to conjure up an image of a better future with your product at the center.Your mission statement is the center of your MVP Tree.A motivating mission statement inspires action. It may be tempting to jump right into coding, but slow down—remember, the goal of this exercise is to determine how little you can do to acquire and retain customers. With both growth and retention, you earn the right to build more.Step 2: Customer ArchetypesA customer archetype is a category of similar people with similar needs (e.g., segmented by age, gender, profession, personality type, etc.). While it may be tempting to want to build a product for everyone, everywhere (7 billion TAM, right?!), doing so will distract you from building exactly what one group needs. Each new segment you attempt to serve can increase scope, adding to your workload and demanding more of your limited resources.The intent of this branch of the tree is to identify one group of potential customers who would be highly motivated to fix their pain as part of your MVP. Draw out a few customer archetypes that might be a fit for your startup, (we’ll discuss later how to prioritize the one group to tackle first.)Step 3: Jobs to Be DoneClayton Christensen’s Jobs to Be Done framework proposes that focusing solely on customer data leads founders on a wild goose chase. Founders should understand what the customer hopes to accomplish, or what their job to be done is.Break down your mission statement into different “jobs”; this itemization will likely narrow your product scope considerably, while still allowing you to create something of significant value.When consumers have a job to be done, they’ll look around at their choices and select the best tool for the job. Your goal is to build the best tool for meaningful, reoccurring jobs that people face. Map out the jobs that you believe exist for the customer archetypes identified in step 2.Step 4: Execution Branches Execution branches will vary based on the company, but think of them as the components of what gets built and where it gets sold. These branches of the MVP tree comprise the components of market expansion that urge founders to explore the tactical side of getting a solid product in front of the right people. This first product launch can either be a costly mistake or an ingenious first step that shows traction with early customers and gives your team and investors confidence. Map these out now as part of the tree and reduce the odds of a headache down the road.In the Roku case study we’ve chosen three execution branches: (1) delivery platforms, (2) sales channels, and (3) chip platforms.Delivery platformsDelivery platforms are the vehicles through which customers come to interact with your product. For software products, they would be the operating systems with big market shares: iOS, Android, web, Mac, and PC. While supporting each additional platform expands your addressable market or breadth of customer touchpoints, it can dramatically increase scope. Developing for multiple platforms at once spreads already-thin resources, which ultimately harms the creation of the best product possible for a specific customer segment.The fewer platforms you choose to support, the smaller the scope. Pick one delivery platform to save resources and prove your value. Investors will recognize that a successful app on iOS will also work on Android with more capital. Focus your precious time on making one platform sing.Clubhouse, a recent startup darling, has quietly grown to over 2M users exclusively on Apple. Some early users might be frustrated because they can’t invite their Android peers, but the strategy to focus on iOS helped Team Clubhouse minimize their initial scope and meticulously learn from early users without the distraction that may come from opening the floodgates.For hardware companies, delivery platforms are essentially the potential SKUs you might consider shipping. Steve Jobs once said that if you are really serious about software, you should build your own hardware. You can think of these hardware form factors as software delivery vehicles. Most people only know Roku for their TV devices, but Roku initially shipped an audio device for Internet radio stations and a PhotoBridge product to get digital photo libraries to the TV. Even when moving to video, consumers had the choice between a stand-alone box or a smaller plug-in stick. Today, Roku has become an operating system embedded in other brands’ TVs.Sales channelsSales channels are the paths through which your product lands in customers’ hands. For software products, the channels are typically through the mobile app stores or directly over the Internet. For hardware products, it’s D2C e-commerce, online retailers, or physical retail.Some sales channels may behave similarly; more often than not, they each pose unique challenges. Every additional sales channel costs resources and increases scope. Pick one channel, prove traction, then experiment with the next.Chip platformsUnique to hardware companies is the choice of which chip to use, and it’s a big one. The choice of semiconductor has profound implications on system requirements like how much memory is needed, how much power is required—and ultimately, the end system cost. Owners of the new Mac M1 laptops are taking advantage of a decade of Apple’s mobile chip development, which is finally robust enough to run the MacOS. The Roku OS has come to run on several different chipsets over time, but in the beginning they had to choose one.Other branchesThere are several other execution branches that may be relevant to your business. If you are an office productivity tool, the data ecosystem you pick is a big one: Google or Microsoft? It’s lazy thinking (and expensive engineering) to try to build for both at the same time. Pick one, show success, then raise more money to address the other half of the market. Again, the fewer of these branches (ecosystems, etc.) you choose to support, the smaller the scope. If your startup doesn’t need to access customer data, the choice of consumer-grade vs. enterprise-grade is a big one that adds scope. The theme remains the same: be selective and pick the branch you have the best shot at success with before adding more.Step 5: Scope Out Your Candidate MVPsIf your map looks like Roku’s, you’re probably now staring at something that has grown to become quite complex, with many “leaves” at the ends of your branches. A single leaf chosen on each branch is what makes up an MVP. The reasonable permutations are your candidate MVPs.Remember, an MVP is the minimally scoped product that gets some job done for your chosen customer archetype.Step 6: Evaluate Your Candidate MVPsHow do you know which MVP to build first? Choose wisely: This will be the next several months of your life.A successful MVP satisfies three criteria:It addresses a meaningful job to be done. A customer spending their own time or money to do a job chooses your solution as the best option for them. Pick a meaningful job—the more frequently occurring the better—and offer a significant advantage (better, faster, or cheaper).It has a growth engine. Build or price growth into your product. There are two viable growth engines for tech companies:Viral, or “inherently viral” growth: Customers either intentionally or unintentionally recruit new customers by using your product. Social platforms use intentional virality; this occurs when users get a more fulfilling experience as more of  their friends join the same platform. Unintentional virality happens when customers inadvertently introduce others to the product experience, similar to how shared bike or scooter riders serve as mobile billboards for the experience.Economic paid acquisition: Contribution margins from customers are recycled into advertising, marketing, and other PR activities that successfully drive additional customers. Note well, though: this engine is “economic” because it must fuel itself. It’s easy to simply buy customers, but only real value makes them stay. Your product must collect far more value over the lifetime of the customer relationship than the cost of acquiring that customer in the first place.It has a rapid time-to-value: How long must customers wait for the “aha” moment? With my first Uber ride in late 2011, it took about two minutes for that moment to arrive: I installed the app, entered my credit card, ordered a car, and it was waiting for me by the time I walked down one flight of stairs. Aha! I knew I’d never wait for another taxi in San Francisco again. The faster and more simply your product can prove its worth, the higher rate of conversion from tire-kickers to retained customers. For software startups, ask yourselves this question: What’s the one screen that will make your customers get it? Step 7: Pick, Beta, ShipNow’s the time to let the rubber meet the road and get a minimal product into a customer s hands. Can it do the job better than their prior solution? Keep iterating until you’re getting that one specific job done. Roku’s first two MVPs weren’t a success (sound bridge + photo bridge). It was however, through the process of mapping out MVPs candidates, testing, and learning that brought intense clarity to and laid out the infrastructure for what would ultimately work a delivery platform for Netflix. Even if the first MVP isn t a hit, you ll be building the muscle needed for the company such as making key hires.Don’t pivot to a different job unless you’ve learned something new that causes you to reconsider your initial hypothesis. This may take a lot of time, but that’s perfectly fine. Stay focused on solving that job until you prove your hypothesis right or wrong. The world is littered with failed companies that never got a product right. Where there’s a job to be done, you can build a solution with enough time, talent, and focus.Roku’s Winning MVP: Step 8: Double-DownWhen you finally find your product getting a recurring job done better than any other tool, stick with it. Don’t take your eye off the prize and move onto new things too quickly.Earn the right to increase scope and move on to other jobs, platforms, and customer archetypes after solidifying your position among this first set of customers―and creating a sustainable growth engine.Final ThoughtsFounders become infatuated with a bold and ambitious mission—as they should. However, what separates a startup that actually brings its mission to life from one that doesn’t is the ability to shed the rose-colored glasses and solve for a small job to be done.A proper MVP framework, such as our MVP Tree presented here, is a critical first step in fulfilling your mission, even though it might seem like you are selling it short. Be patient. It won’t be easy realizing your mission, and it shouldn’t be. If your mission were easy, it would already be done by someone else!Want to see an MVP Tree for another startup? Tweet @Shawnvc to nominate a company! This post previously appeared in Real Clear Defense.The Latin phrase E Pluribus Unum – Out of Many, One is our de facto national motto. It was a rallying cry of our founders as they built a single unified nation from a collection of states. It s a good reminder of where we need to go.Today as our country struggles to find the common threads that bind us, we need unifying, cohesive, collective, and shared national experiences to bring the country together again.Here s what we’ve done to get started.And why I did it. -Pete Newell, Joe Felter and I met over coffee in 2016 to discuss our common goal – how to get students in research universities who would never consider working on national security problems engaged in keeping the country safe and secure.Today, our contribution to national service, Hacking for Defense, turned five years old. In this class, students learn about the nation’s emerging threats and security challenges while working with innovators inside the Department of Defense.The result? The class teaches students entrepreneurship while they engage in what amounts to national public service. From our single class at Stanford, Hacking for Defense is now taught at 47 U.S. universities having graduated 500 teams and 2,000+ students.Why Serve?My interest in starting Hacking for Defense was rooted in my long belief in service – not just paying taxes or voting, but actual service. I had a great career as an entrepreneur, but always believed that at some point in your life you need to serve others – whether it’s God, country, community, or family. And I did so in my stints in the military and public service and as an educator.DisconnectionLooking back it’s clear that our country was far more cohesive when millions of us had to physically share space and live and work with others who didn’t think like us or talk like us. The Air Force turned out to be the first melting pot I would encounter (Silicon Valley the next) where individuals from different classes and culture had the opportunity to share a common goal and move beyond the environment they grew up in. At each base I was stationed in, I hung out with a group that tutored each other, read books together, went on adventures together and learned together. And while most of us came from totally different backgrounds (before the Air Force, I never knew you put salt on watermelon, that Spam was food or muffuletta was a sandwich), as far as the military was concerned, we were all the same.But a half-century ago, the country started to disconnect from each other and our government when we eliminated national service. In 1973, near the end of the Vietnam War, the U.S. ended compulsory military service and has since depended on an all-volunteer military.One result of this experiment: the risk for the sons and daughters being sent into harm’s way is no longer evenly distributed across all segments of society. Many American families no longer have a personal vested interest in our nation’s decisions about foreign policy.The unintended consequence of this decoupling is seemingly perpetual wars (we’ve been in Afghanistan for two decades). And with our country focused for two decades on fighting non-nation states – Al-Qaida and Isis – Russia re-armed and China has built weapons that have negated our strengths, matched our military, and threaten democracy around the world.Even more corrosive to the nation is that without any type of mandatory national or public service not just military service we eliminated any unifying, cohesive, collective, shared national experience, or shared values.ValuesInstead our values are shaped by what we read on social media, where we find an echo-chamber of others who think like we do. Technology that was supposed to bring us together has instead sold out the country for partisanship and division, for profit over national interest. Others found it politically and/or financially profitable to create distrust in the government institutions that protect and bind us. The result is that we’re easy targets for disinformation by adversaries intent on undermining our government and its institutions.The world isn’t a benign place. Our freedoms and values need to be defended. Throughout history the capacity of human beings to think up new ways to kill one another has proved endless. My parents, along with millions of others, lost parents, siblings, and extended family in Nazi-occupied Europe. Volunteering for national service for me was a partial payback for the country that welcomed them, sheltered them, adopted them, and allowed them to become Americans. And as much as we wish it and try, we will not eradicate violent conflict in our lifetimes or even in our children’s lifetimes. Today, the struggle for freedom and human rights continues across the globe. Ask the Uighurs, or the people in Hong Kong or Tibet what happens when their freedom is extinguished.A Contribution to National ServiceFive years ago, listening to Pete and Joe talk about the problems the Department of Defense (DoD) faced reminded me of what I noticed inside the parts of the government where I was now spending time. While there were smart, dedicated people serving their country, few of students from the schools I was teaching at were there. Few of my students knew what the DoD or other branches of government did. It just wasn’t part of their lives.It dawned on us that building on the last national curriculum I created – the National Science Foundation I-Corps, we could hit the ground running and create our own version of a national service. We envisioned a national Hacking for Defense program across 50 universities.It’s taken five years, but I’m proud we’ve accomplished just that. The class is now adding 1,000+ students a year, many of them choosing to change career paths to work in national service or the public sector after graduation.Still, there’s much more we can and must do.While my entrepreneurial career allowed me to work with people who built great products and companies, my national and public service careers connected me to those who’ve dedicated their lives to serving others. And I’ve concluded that a life lived in full measure will do both.We need to scale the existing national and public service initiatives AmeriCorps, YouthBuild, PeaceCorps,U.S. Digital Service, Defense Digital Service, and conservation corps that today only reach 100,000 people. We need to offer every high school and college graduate all 4 million of them a shared national experience.In the face of forces working to tear us apart, we must remember that we are stronger together, more resilient together, more successful together, than we are apart. Our challenge is to bring unity back to a nation that is built on different backgrounds and beliefs. E Pluribus Unum – Out of Many, One.Hacking for Defense is our contribution to what hopefully will be a much larger effort to help unify the country.Lessons LearnedWe need to find the common threads that bind usWe need unifying, cohesive, collective, and shared national experiences and values will help bring the country together againHacking for Defense is our contribution A version of this story previously appeared in Defense One.The story of RYAN and Able Archer is an oft-told lesson of a U.S. intelligence failure, miscalculation, and two superpowers unaware they were on the brink of an accidental nuclear war all because the Soviet Union relied on a software program to make predictions that were based on false assumptions.As more of our weapons systems and analytical and predictive systems become enabled by AI and Machine Learning, the lessons of RYAN and Able Archer is a cautionary tale for the DoD.In 1983, the world’s superpowers drew near to accidental nuclear war, largely because the Soviet Union relied on software to make predictions that were based on false assumptions. Today, as the Pentagon moves to infuse artificial-intelligence tools into just about every aspect of its workings, it’s worth remembering the lessons of RYAN and Able Archer.Two years earlier, the Soviet Union had deployed a software program dubbed RYAN, for Raketno Yadernoye Napadenie, or sudden nuclear missile attack. Massive for its time, RYAN sought to compute the relative power of the two superpowers by modeling 40,000 military, political, and economic factors, including 292 “indicators” reported from agents (spies) abroad. It was run by the KGB, which employed more than 200 people just to input the data.The Soviets built RYAN to warn them when their country’s relative strength had declined to a point that the U.S. might launch a preemptive first strike on the Soviet Union. Leaders decided that if Soviet power was at least 70 percent of that of the United States the balance of power was stable. As the months went by, this number plummeted. By 1983, RYAN reported that Soviet power had declined to just 45 percent of that of the United States.This amplified Soviet leaders’ paranoia. After 25 years of back-and-forth in the nuclear arms race, the Peacekeeper ICBM and the Trident SLBM were tipping the balance in favor of the United States. Responding to the Soviet introduction of SS-20 intermediate-range ballistic missiles to Eastern Europe in 1983, the U.S. deployed Pershing II and Ground Launched Cruise Missiles missiles to Western Europe, which reduced warning time of attack on Moscow to less than eight minutes. And in March 1983, President Reagan announced the Strategic Defense Initiative – “Star Wars” – to intercept Soviet ICBMs, then piled on just weeks later by publicly labeling the Soviet Union “the Evil Empire.” And to cap off a very bad year in the Cold War, in September 1983 the Soviets accidentally shot down a civilian 747 airliner—KAL 007—killing all 269 aboard.By 1983, Soviet political and military leaders truly believed a nuclear war was coming. The RYAN program took on even greater importance. To feed RYAN, the KGB made its top priority to collect indicators of anything that might precede a potential surprise nuclear missile attack. They were looking for direct indicators—had the U.S. Continuity of Government program (doomsday planes) been activated? Had the U.S. given advance warning to launch our strategic nuclear forces? They also collected secondary indicators. Their agents inside the U.S. and allied countries watched for heightened activities in and around Washington offices (White House, Pentagon, State Dept, CIA, etc.), including the White House parking lot, places of evacuation and shelter, the level of blood held in blood banks, observation of where nuclear weapons were stored, etc. Some of the indicators were based on a mirror-image of how the Warsaw Pact would prepare for war. Soviet case officers were instructed to look for deviations in the behavior of people in possession of classified information suddenly moving into specially equipped secure accommodations.While most of the KGB station chiefs and case officers thought Moscow was being paranoid, they dutifully reported what they thought their leaders wanted to hear.By November 1983, Soviet military and political leaders had convinced themselves that a nuclear first strike from the United States was probable. The RYAN program told them that the odds favored the U.S., and the war indicators in Moscow were flashing red.That month, NATO ran a highly realistic set of wargames in Europe called Able Archer 83. These included an airlift of 19,000 U.S. soldiers in 170 aircraft under radio silence to Europe, the shifting of commands from Permanent War Headquarters to the Alternate War Headquarters, and practicing nuclear weapons release procedures.In reaction, the Chief of the Soviet Air Forces ordered all units of the Soviet 4th Air Army on alert which included preparations for immediate use of nuclear weapons. It appears that at least some Soviet forces were preparing to preempt or counterattack a NATO strike launched under cover of Able Archer.Luckily, no one overreacted. The Able Archer 83 exercise passed.For years, the U.S had no idea that the Soviet Union had believed the exercise was a cover to launch a nuclear first strike. The Berlin Wall had fallen by the time information from a defector and an end-of-tour letter from the U.S. general responsible for Air Force Intelligence in Europe prompted presidential intelligence board to revisit what the Soviets had thought. In hindsight, RYAN and Able Archer took the Cold War to the brink of Armageddon.Even when RYAN was reporting that the U.S. had a decisive military advantage, what made the Soviets believe that we would launch a first-nuclear strike? No one knows. However, given Nazi Germany’s surprise attack on the Soviet Union in WWII, resulting in 25 million dead and the extreme devastation inflicted on their country, the Soviet Union had reason to be paranoid. Some have suggested that the Soviets had interpreted President Carter’s 1980 Presidential Directive 59 Nuclear Weapon Employment Policy as preparation for a nuclear first strike. Perhaps the Soviet Union ascribed their own plans for a first strike on the U.S. to their Cold War enemy. Or perhaps the U.S. actually did have a first-strike option in one of our operational plans that the Soviets discovered via espionage.Why were the Soviets convinced that a war would start with a war game? Several months after Able Archer, the Soviet Minister of Defense publicly acknowledged his country’s inability to tell a big NATO exercise from an actual attack: “It was difficult to catch the difference between working out training questions and actual preparation of large-scale aggression.” It’s quite likely that the Soviets’ own plans for launching a war in Europe would have been as part of a war game.Certainly the Soviets, believing the signals of the RYAN alert system, were primed to assume a U.S. attack. In attempting to automate military policy and potential actions, the Soviets had amplified their existing paranoia. (A movie called War Games came out that year with some of the same themes.)A Cautionary Tale for Automating Policy and PredictionForty years ago RYAN attempted to automate military policy and potential actions. But in the end, RYAN failed in actually predicting U.S. intent. Instead, RYAN reinforced existing fears, and accidently created its own paranoia.While the intelligence lessons of RYAN and Able Archer have been rehashed for decades, as our own AI initiatives scale no one is asking what lessons RYAN/Able Archer should have taught us about building predictive models and what happens when our adversaries rely on them.Which leads to the question: What could happen when we start using Artificial Intelligence and Machine Learning to shape policy?What could happen when we start using artificial intelligence and machine learning to shape policy?Will AI/ML actually predict human intent?What happens when the machines start seeing patterns that aren’t there?How do we ensure that unintentional bias doesn’t creep into the model?How much will we depend on an AI that can’t explain how it reached its decision?How do we deconflict and deescalate machine-driven conclusions? Where and when should the humans be in the loop?How do we ensure foreign actors can’t pollute the datasets and sensors used to drive the model and/or steal the model and look for its vulnerabilities?How do we ensure that those with a specific agenda (i.e. Andropov, chairman of the KGB) don’t bias the data?How do we ensure we aren’t using a software program that misleads our own leaders?The somewhat-comforting news is that others have been thinking about these problems for a while. In 2020, the Defense Department formally adopted five AI ethical principles recommended by the Defense Innovation Board for the development of artificial intelligence capabilities: AI projects need to be Responsible, Equitable, Traceable, Reliable and Governable. The Joint Artificial Intelligence Center appointed a head of ethics policy to translate these principles into practice. Under JAIC’s 2.0 mission, they are no longer the sole developer of AI projects, but instead providing services and common software platforms. Now it’s up to the JAIC ethics front office to ensure that the hundreds of mission areas and contractors across the DoD adhere to these standards.Here’s hoping they all remember the lessons of RYAN.Lessons LearnedRYAN amplified the paranoia the Soviet leadership already hadThe assumptions and beliefs of people who create the software shape the outcomesUsing data to model an adversary’s potential actions is limited by your ability to model its leaderships intentYour planning and world view are almost guaranteed not to be the same as those of your adversaryHaving an overwhelming military advantage may force an adversary into a corner. They may act in ways that seem irrationalResponsible, Equitable, Traceable, Reliable and Governable are great aspirational goals

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