How the Pentagon Can Rethink Industrial Engineering

Geopolitical competition between the United States and China continues to heighten, magnified by the race to dominate artificial intelligence (AI) across military power, manufacturing, and other critical sectors. In the limelight is the Defense Industrial Base (DIB). 

What is the Defense Industrial Base?

The DIB is a network of organizations, including the broader U.S. and allied industrial base, that lead research and development, design, production, and maintenance of U.S. defense systems. These systems include everything from parts and components to software and services. 

As a critical infrastructure sector, the DIB ensures the readiness and reliability of these Department of Defense (DOD) systems to defend, deter, and secure our nation against adversaries.

As such, the DIB must boost innovation and increase production in response to rising competition and the impending conflict with China. However, limited resources, aging infrastructure, and a shrinking workforce constrain the DIB.

Procurement Process Improvement and Supply Chain Collaboration

The broader U.S. industrial base depends on foreign allies for critical supplies, including industrial minerals and materials needed for major weapons categories. This outsourcing creates supply chain risks for industrial operations, defense capabilities, and our national security. 

In tandem with shrinking domestic industrial operations, the DIB has consolidated significantly over the past 30 years, relying on a small number of large commercial companies to drive output. By slimming down the supply chain, the DIB network has stifled competition and innovation.

Small business collaboration with the DIB has fallen by 40% over the last decade. Small businesses, organizations with less than 500 employees, are major drivers for innovation, economic growth, and employment. Small businesses account for 43.5% of the nation’s GDP. From patent activity and skilled job creation to technology usage and strategic research, small businesses strengthen national security. 

Despite that, today’s rigorous DOD acquisition policy creates high barriers to entry for small businesses, limiting competition, innovation, and technology advancement for the DIB – and the White House is taking notice. 

“lt is a top priority for [DOD] to reform its acquisition processes in order to acquire, deliver, and iterate on our weapon and business systems - including software - at speed and scale,” said Defense Secretary Pete Hegseth in a memo issued March 6.

The DIB faces bottlenecks throughout the procurement process, supply chain, and production. The Pentagon and its procurement champions must gear up to bring production back to U.S. soil to ensure America is first to the finish line, leading technology advancements, defense and manufacturing prowess, and economic prosperity. By collaborating with small businesses, the DIB can reinvigorate domestic supply chains and ensure America continues to lead in innovation.

Industrial Maintenance for Critical Infrastructure Sectors

Industrial base operations and processes have not changed in decades. The infrastructure our nation relies on is rapidly aging, inefficient, and increasingly vulnerable to a strained power grid. As it stands, the DIB does not have the capacity to meet DOD demand, putting warfighter readiness at risk.

This is especially true for shipyards. Existing U.S. shipyards account for just 0.13% of global market share. In comparison, China’s shipbuilding capacity is 47%. These inefficiencies trickle down throughout maintenance and repair processes as well. With conventional sustainment methods, the Navy is estimated to be 20 years behind in maintenance delays. As a result, about 100 ships are unavailable for deployment. 

“I go to a lot of shipyards. It's like taking a walk back in time. We all have to help pull these industrial operations into the 21st century and beyond,” said Naval Sea Systems Command (NAVSEA) executive director Christopher Miller during the Defense Software and Data Summit last month.

Although the Navy aims to increase fleet size year over year, more tonnage means more maintenance is required to keep assets in the fight. Without necessary operational changes that increase efficiency, more ships will continue to be sidelined.

Industrial infrastructure challenges extend beyond shipyards and physical capacity. By 2033, 1.9 million manufacturing jobs are projected to go unfilled, widening the gap between demand for critical defense assets and labor supply. 

The DOD must encourage industrial innovation to attract and retain a skilled workforce that can build, operate, and maintain increased military capacity.

Access to emerging commercial and small business solutions can address these complex DIB challenges. By collaborating, we can deploy new technologies and advancements that get more players on the field with reliable defense assets – from design and production to maintenance and sustainment.

How? The DIB can potentially change the trajectory of industrial operations by unlocking access to data layers.  

Asset Lifecycle Management with Operational Technology

As soon as defense assets leave the manufacturing floor, they begin to depreciate. Data on the DIB and the industrial assets that make up its critical infrastructure is nonexistent. Without high-quality, high-fidelity data on the health of defense assets from start to finish, the DIB will continue to fall behind. 

In 2025, the DOD has a proposed budget of more than $300 billion to revitalize the DIB. To stay ahead of China, the DOD must invest in commercial, operational technology that harnesses the power of data.

Dual-use solutions like Cantilever use AI and robotics to deliver the decision advantage at every stage of critical asset lifecycles. Gecko uses fixed sensors and robots that climb, crawl, swim, and fly to build full-coverage, high-fidelity data layers on the physical world. The data is combined with historical records and integrated into one centralized AI-powered software platform for fleet-wide visibility.

For example, Gecko recently partnered with L3Harris Technologies to develop a highly advanced extended reality (XR) data layer, also known as photogrammetry, that enhances the detection of physical defects for improved efficiency in the aircraft maintenance and sustainment process. The technology captures more than 10,000 high-definition images that provide a digital twin of the aircraft, enabling U.S. military and industry service providers to assess the health of a platform, regardless of where the fleet is located. 

Effective AI starts with first-order data. DIB leaders need to make data-driven decisions that increase production, extend asset lifecycles, and optimize maintenance for cost, schedule, and performance – directly contributing to national security. Only then will AI modernize and transform how the DIB builds, operates, and maintains its critical infrastructure. 

Rebuilding the Defense Industrial Base with American Innovation

The DIB and the broader U.S. and allied industrial base have led innovation in times of crisis since World War II. Unfortunately, today’s industrial sectors have fallen behind. While technology companies have spent decades curating data sets that advance large language models (LLMs) and modern AI, data for industrial applications is nonexistent.

Together, policymakers and industry can modernize the DIB with American entrepreneurship and competitive edge. The industrial base needs commercial solutions that build industrial data sets and processing capabilities that preserve and grow U.S. military power.

Data is the key to rebuilding the domestic industrial base, protecting our nation with readiness and reliability across every U.S. fleet, and forging the path forward in the AI economy.

Learn more about Gecko’s partnership with L3Harris Technologies. 

Learn More