JULY 28, 2016

Editor’s Note: You can read a longer account of Steve Blank’s visit to the U.S.S. Carl Vinson at his website later this week. 

Sitting backwards in a plane with no windows, strapped in a 4-point harness, head encased in a helmet, eyes covered by goggles, your brain can’t process the acceleration. As the C-2 A Greyhound is hurled off an aircraft carrier into the air via a catapult, your body is thrown forward in the air, until a few seconds later, hundreds of feet above the carrier now at 150 miles per hour you yell, “Holy sh*t!” And no one can hear you through the noise, helmet, and ear protectors.

I just spent two days a hundred miles off the coast of Mexico as a guest of the U.S.S. Carl Vinson with Pete Newell (my fellow instructor in the Hacking for Defense class) and 11 other Stanford faculty from CISAC and the Hoover Institution. It’s hard to spend time on a carrier and not be impressed with the Navy and the dedicated people who man the carrier and serve their country.

I learned quite a bit about the physical layout of a carrier, how the air crew operates, and how the carrier functions in context of the other ships around it (the strike group). But the biggest lesson I took from our visit was the realization that disruption is not just happening to companies, it’s also happening in the Navy. The lean innovation tools we’ve developed to deal with disruption and create continuous innovation for large commercial organizations are equally relevant to the U.S. Navy.

While there has been a fierce debate over the future of the aircraft carrier, I have a different take. From what I have seen, both of the following statements are true:

  1. The aircraft carrier is viable for another 30 years.
  2. The aircraft carrier is obsolete.

How can that be?

Well-defended targets

Among the primary roles of the 44 F/A-18 strike fighters that form the core of the carrier’s air wing is to control the air and drop bombs on enemy targets. For targets over uncontested airspace, that’s pretty easy. The problem is that countries with more capable militaries have developed advanced air defense systems such as the Russian S–300 and S-400 and the Chinese HQ-9 . These formidable systems are extremely effective at shooting down aircraft, including those flown by the U.S. military.  They have been selling these systems to other countries, including adversaries like Iran and Syria. While the role of an aircraft carrier’s EA-18G Growlers is to jam and confuse the radar of these missiles, the sophistication and range of these surface-to-air missiles have been evolving faster than the jamming countermeasures on the EA-18G Growlers (and the hacks to shut the radars down).

This means that the odds of a carrier-based F/A-18 strike fighter successfully reaching a target defended by these modern surface-to-air missiles is diminishing yearly. Unless the U.S. military can first take out these systems with missiles, drones, cyber attacks, and other means, skilled pilots are not enough. Given the F/A-18’s are manned aircraft, American political leaders may find the risk of high losses of pilots politically unacceptable.

Vulnerable Carriers

If you want to kill a carrier, first you must find it and then you have to track it. In World War II, knowing where the enemy fleet was located posed was a big — and critical — question. Today, photo imaging satellites, satellites that track electronic emissions (radio, radar, etc.) and satellites with synthetic aperture radar that can see through clouds and at night are able to pinpoint the strike group and carrier 24/7. In the 20th century, only the Soviet Union had this capability. Today, China can do this in the Pacific. To a more limited extent, Iran in has the capability in the Persian Gulf. Soon there will be enough commercial satellite coverage of the Earth using the same sensors, that virtually anyone able to pay for the data will be able to track the ships.

During the Cold War, the primary threat to carriers was from the air — from strike/fighters dropping bombs/torpedoes or from cruise missiles (launched from ships and planes). While the Soviets had attack submarines, our anti-Submarine Warfare (ASW) capabilities (along with very noisy Soviet subs pre-Walker spy ring) made subs a secondary threat to carriers.

In the 20th century, the war plan for a carrier strike group used the F/A-18 aircraft and Tomahawks to destroy enemy radar, surface-to-air missiles, aircraft, and communications (including satellite downlinks). As those threats are eliminated, the carrier strike can move closer to land without fear of attack. This allows the aircraft to loiter longer over targets or extend their reach over enemy territory.

Carriers were designed to be most effective launching a high number of sorties from about 225 miles away from the target. This allows us to, for example cruise offshore of potential adversaries (Iraq and Syria) who can’t get to our carriers. Carriers can standoff farther or can reach further inland, but they have to launch refueling tankers to extend the mission range. For example, missions into Afghanistan are six to eight hours versus normal mission times of two to three hours.

Confronting better equipped adversaries, carriers face multiple threats before they can launch an initial strike. These threats include much quieter submarines, long-range, sea-skimming cruise missiles, and — in the Pacific — a potential disruptive game changer:  ICBMs armed with non-nuclear maneuverable warheads that can hit a carrier deck (DF-21d and the longer range DF-26). In the Persian Gulf the carriers face another threat — Fast Inshore Attack Craft (FIAC) and speedboats with anti-ship cruise missiles that can be launched from shore.

The sum of all these threats — to the carrier-based aircraft and the carriers themselves —  are called anti-access/area denial (A2/AD) capabilities.

Eventually the cost and probability of defending the carrier as a manned aircraft platform becomes untenable in highly defended A2/AD environments like the western Pacific or the Persian Gulf. (This seems to be exactly the problem the manned bomber folks are facing in multiple regions.) But if not a carrier, what will the United States use to project power?  While the carrier might become obsolete, the mission certainly has not.

So how does/should the Navy solve these problems?

Three Horizons of Innovation

One useful way to think about innovation in the face of increasing disruption/competition is called the “Three Horizons of Innovation.” It suggests that an organization should think about innovation across three categories called “Horizons.”

  • Horizon 1 activities support executing theexisting, core mission with ever increasing efficiency.
  • Horizon 2 is focused on extendingthe core mission.
  • Horizon 3 is focused on searching for and creatingbrand new missions.

Horizon 1 is the Navy’s core mission. Here the Navy executes against a set of known mission requirements (known beneficiaries, known ships and planes, known adversaries, deployment, supply chain, etc.). It uses existing capabilities and has comparatively low risk to get the next improvement out the door.

In a well-run organization like the Navy, innovation and improvement occur continuously in Horizon 1. Branches of the Navy innovate on new equipment, new tactics, new procurement processes, new procedures, etc. As pilots want more capable manned aircraft and carrier captains want better carriers, it’s not a surprise that Horizon 1 innovations are upgrades — the next generation Ford Class carrier and next generation F-35C aircraft. As a failure here can impact the Navy’s current mission, Horizon 1 uses traditional product management tools to minimize risk and assure execution. And yes, like any complex project they still manage to be over budget and miss their delivery schedule.

Because failure here is unacceptable, Navy Horizon 1 programs and people are managed by building repeatable and scalable processes, procedures, incentives, and promotions to execute and the mission.

In Horizon 2, the Navy extends its core mission. Here it looks for new opportunities within its existing mission (trying new technology on the same platform, using the same technology with new missions, etc.). Horizon 2 uses mostly existing capabilities (the carrier as an aircraft platform, aircraft to deliver munitions) and has moderate risk in building or securing new capabilities to get the product out the door.

An example of potential Naval Horizon 2 innovations is unmanned drones flying off carriers to serve as as airborne tankers and ISR (intelligence, surveillance, and reconnaissance).  However, getting the tanker and ISR functions onto drones only delays the inevitable shift to drones for strike and then for fighters.

The problem of strike fighters’ increasing difficulty in penetrating heavily defended targets isn’t going to get better with the new F-35C. In fact, it will get worse. Regardless of the bravery and skill of the pilots, they will face air defense systems evolving at a faster rate than the systems on the aircraft. It’s not at all clear in a low-intensity conflict (think Bosnia or the fight against jihadist groups in Syria) that civilian leadership will want to risk captured or killed pilots and losing expensive planes like the F-35C.

Management in Horizon 2 works by pattern recognition and experimentation inside the current mission model. Ironically, institutional inertia keeps the Navy from deploying unmanned assets on carriers. Drones in carrier tanker and ISR roles should have been deployed several years ago. And, by now, experience with them on a carrier deck could have led to first, autonomous wingmen and eventually autonomous missions. Instead the system appears to have fallen into the “real men fly planes and command air wings and get promoted by others who do” mindset.

The Navy does not lack drone demos and prototypes, but it has failed to deploy Horizon 2 innovations with speed and urgency. Failure to act aggressively here will impact the Navy’s ability to carry out its mission of sea control and power projection. Along these lines, the Hudson Institute’s report on the future of the carrier is worth a read and a RAND report on the same topic comes out in October.

If you think Horizon 2 innovation is hard in the Navy, wait until you get to Horizon 3. This is where disruption happens. It’s how the aircraft carrier disrupted the battleship, how nuclear-powered ballistic missile submarines changed the nature of strategic deterrence, and how the DF-21/26 and artificial islands in the South China sea changed decades of assumptions.  And it’s why, in most organizations, innovation dies.

For the Navy, a Horizon 3 conversation would not be about better carriers and aircraft. Instead it would focus on the core reasons the Navy deploys a carrier strike group: to show the flag for deterrence, to project offensive airpower from the sea, sea control, or to protect a Marine amphibious force.

A Horizon 3 solution for the Navy would start with basic need of these missions, the logistical requirements that come with them, and the hurdles to their success, like A2/AD.  Lots of people have been talking and writing about this, and lots of Horizon 3 concepts have been proposed, such as distributed lethalityarsenal ships, underwater drone platforms, etc.

Focusing on these goals — not building or commanding carriers, or building and flying planes — is really, really hard. It’s hard to get existing operational organizations to think about disruption because it means they have to be thinking about obsoleting a job, function, or skill they’ve spent their lives perfecting. It’s hard because any large organization is led by people who succeeded as Horizon 1 and 2 managers and operators (not researchers). Their whole focus, career, incentives, etc. has been about building and make the current platforms work. And the Navy has excelled in doing so.

The problem is that Horizon 3 solutions take different people, different portfolio, different process, and different politics.

People: In Horizon 1 and 2 programs, people who fail don’t get promoted because, in a known process, failure to execute is a failure of individual performance. However, applying the same rules to Horizon 3 programs — no failures tolerated — means we’ll have no learning and no disruptive innovations. What spooks leadership is that in Horizon 3, most of the projects will fail. But using lean innovation, they’ll fail quickly and cheaply.

In Horizon 3 the initial program is run by mavericks — the crazy innovators. In the Navy, these are the people you want to court martial or pass over for promotion for not getting with current program. (In a startup they’d be the founding CEO.) These are the fearless innovators you want to create new and potentially disruptive mission models. Failure to support their potential disruptive talent means it will go elsewhere.

Portfolio: In Horizon 3, the Navy is essentially incubating a startup. And not just one. The Navy needs a portfolio of Horizon 3 bets, for the same reason venture capital and large companies have a portfolio of Horizon 3 bets, not just one.

Process: A critical difference between a Horizon 3 bet and a Horizon 1 or 2 bet is that you don’t build large, expensive, multi-year programs to test radically new concepts (think of the Zumwalt class destroyers). You use “lean” techniques to build minimal viable products (MVPs). MVPs are whatever it takes to get you the most learning in the shortest period of time.

Horizon 3 groups operate with speed and urgency. They need to be physically separate from operating divisions in an incubator or their own facility. And they need their own plans, procedures, policies, incentives, and key performance indicators (KPIs) different from those in Horizon 1. 

The watchwords in Horizon 3 are “If everything seems under control, you’re just not going fast enough.”

Politics: In Silicon Valley most startups fail. That’s why we invest in a portfolio of new ideas, not just one. We embrace failure as an integral part of learning. We do so by realizing that in Horizon 3 we are testing hypotheses — a series of unknowns — not executing knowns. Yet failure/learning is a dirty word in the world of promotions and the “gotcha game” of politics. To survive in this environment Horizon 3 leaders must learn how to communicate up/down and sideways that they are not running Horizon 1 and 2 projects.

Failure to make a portfolio of Horizon 3 bets means that the Navy is exposed to disruption by new entrants unencumbered by decades of success, fueled by their own version of manifest destiny.

Lessons Learned

  • Our carriers are a work of art run and manned by professionals.
    • Threats that can degrade or negate a carrier strike group exist in multiple areas.
    • However, carriers are still a significant asset in almost all other combat scenarios.
  • Speed and urgency rather than institutional inertia should be the watchwords for Horizon 2 innovation.
  • Horizon 3 innovation is about a clean sheet of paper thinking.
  • It requires different people, portfolio, process and politics.
  • The Navy (and DOD) must manage innovation across all three Horizons.
    • Allocating dollars and resources for each.
  • Remember that today’s Horizon 3 crazy idea is tomorrow’s Horizon 1 platform.

Entrepreneur-turned-educator Steve Blank is credited with launching the Lean Startup movement. He’s changed how startups are built; how entrepreneurship is taught; how science is commercialized, and how companies and the government innovate. Steve is the author of The Four Steps to the Epiphany, The Startup Owner’s Manual — and his May 2013 Harvard Business Review cover story defined the Lean Startup movement.  He teaches at Stanford, Columbia, Berkeley and NYU; and created the National Science Foundation Innovation Corps — now the standard for science commercialization in the United States. His Hacking for Defense class at Stanford is revolutionizing how the U.S. defense and intelligence community can deploy innovation with speed and urgency.

Image: U.S. Navy, Mass Communication Specialist 2nd Class Patrick W. Menah