Stephen Welby was confirmed as assistant US secretary of defense for research and engineering Dec. 14. In that role, he reports directly to Pentagon acquisition head Frank Kendall on how best to guide the science and technology research that provides the Pentagon its technological base. In a March 17 interview, he discussed the "Third Offset" strategy and how best to make sure the Defense Department lab structure remains relevant.

The term "Third Offset" has been used to describe a broad selection of new technologies. What does Third Offset mean to you?

Look, I think it's a useful, it's a usefully ambiguous term. [Deputy Secretary of Defense Bob Work's] discussions about Third Offset are not about technology. [Previous offsets] were enabled by technology, but what technology allowed us to do was think about new operational concepts that offered US forces an asymmetric advantage over threats. I think those ideas will be enabled by technology, but it's not all about technology. It's not like there's some set of blessed technologies that are in the kind of Third Offset bucket. The Third Offset discussion is about what is, what are we going to look like in the future … what kind of technologies do we need to be developing today in our science and technology pipeline, or modifying from the commercial sector, or encouraging academic research to advance, or working our laboratories to accelerate, or experimenting with in the field that are going to give us those new capabilities into the future.

So in your mind, it is as much about changing business as usual in the building as it is innovations?

Just talking about it as technologies alone, I think, is a kind of a limiting factor. People like the cool, shiny technology piece, but it's really about "how do I find those things that are going to matter operationally and strategically in a competitive future environment?"  Much more important than any kind of individual technology is kind of the focus on time, on the notion that we're going to have to accelerate our timelines of adopting innovative approaches in the future. The recognition that in a world where globalization of technology, globalization of technological talent, where other countries now have significant resources supplied to military modernization — and where they can use us as the model to not have to do some of that research, we've done it for them — the timelines for others to kind of turn their technological OODA Loop, if you will, are getting shorter and we've got to flex our muscles again and start to turn our technology loop faster as well.

What kind of technologies are you developing at the S&T level that you think will pay off heavily in the future?

I'm very excited about the work going on in advanced material science that enable not just new materials, but it's looking at very novel electronic properties. The stuff going on in terms of software that we're working on, I think we're doing very cool things in thinking about the terms autonomy, military applications in terms of thinking about novel ways to work with very big, big data problems in a military context. The basic researcher is just think about big data, [and] then we think about how we can take that and map that against the kind of problems one has in planning manned and unmanned aircraft operations.

I'm very interested in emerging biotechnology and what's happening there. It's clearly an enormous, a very fast-moving area. One without an obvious military application today, but I think in terms of medical care, potentially downstream, things that might have to do with personalized medicine, ways to improve war-fighter performance [it is relevant]. To be able to let you know that you're coming down with a cold days before you start to show symptoms and what that might imply in terms [of readiness]. I mean, real interesting stuff for which we don't really know what the military application is, but we're paying a lot of attention to it, because we see the pace of technology.

But how do you keep up with all those technologies when they are being largely developed outside the Pentagon's laboratory structure?

Our teams are deployed globally [and] engage with universities around the world to have an understanding of what's happening. I think those things are going to pay off in a decade. That's why we're invested in the very early work. It gives us feelers into what's hot and what's happening. Then the teams that are in the commercial side as well, in kind of early feeder outreach. Then our laboratories represent that kind of middle layer, where we're trying to map. We've got very smart people who are mapping those kinds of emerging technologies into military, military space and applications, who are experimenting those in context. And, then that creates opportunities that come back to us through the defense industrial base.

So, I think that pipeline works. Almost everything we're delivering today is based upon developments that occurred a decade ago. It's very difficult to point forward and say this is going to have this kind of impact, but it's very easy to point back, right? And, I think a decade from now someone will come back and complain about [I] was talking about this synthetic bio stuff and it didn't pay out. But, hopefully, other things will. So, those small bets — and they do tend to be small bets, investing in a researcher here and there or some graduate students doing unclassified work that gets published to build communities — feeds a long pipeline that creates opportunity.

Are you looking at the DoD laboratory structure and whether it should be revamped in some way?

We often go to the org chart as the answer, but I think that the real question is, "am I getting the right kind of bang for the buck?" It's interesting that the models have changed across commercial. You don't see Bell Labs around anymore, you don't see corporate labs quite the same way that they existed before. We're asking, "are there other models, are we making the right kind of choices?" The question I've asked our S&T execs in the Army, Navy and Air Force, we have very careful processes by which we start programs, and we coordinate and make sure we're not overlapping. We're very deliberate about how we plan and spend the first dollar. I've been asking them to think about what are our processes by which we kill programs. How do I turn things off, how do I make the decision that I might better spend the money on something new rather than the [program] that we're currently funding? How do I know when to get out of something?

I think that's as much of a test of a laboratory structure than anything else. It's a question of choices in the laboratories — how do I, do I invest in external work, do I invest in internal work, do I build a bench capacity, am I buying equipment, am I building laboratory strength in an area? Am I recruiting and hiring talent in a particular domain? How actively are we shaping these pieces? And, the labs have been very interested to kind of take that on.

Is the system OK as it is, then?

I think there probably are things we could be doing better. The one that I'm most concerned about is talent. And, particularly in the areas that we're most interested in, in things like advanced software, our cutting edge bioscience, we have difficulty competing with the commercial sector in terms of compensation. We're never going to compensate the way Google or Apple does. And, we see the best and brightest making that choice, folks leaving us to go to work in more lucrative commercial sectors. Hopefully, some of them maybe come back to us some day. But we offer other appeals. We offer mission, we offer technical opportunity, we offer opportunity to get with colleagues, we offer opportunity to kind of manage scopes of work that perhaps folks might not have in other places. We want to use those effective tools to kind of compete for talent.

We talk about our workforce, and people think about an industrial model of, how many workers do I need? The laboratories don't work that way. The laboratories are really about key technical talent. It really is about make sure we've got the best and brightest in the right places to make a difference. And, we're unlikely to find those folks kind of trolling [] looking for their next opportunity, right? So that is, I think, the biggest opportunity we have for rethinking our lab processes, is thinking about our people processes.

Do you have concerns the next administration may change course on the technological innovations Secretary Ash Carter has pushed?

I don't, at least in our area. I'm not concerned, because we're not working on these topics because they're Dr. Carter's initiatives, they're Secretary Kendall's initiatives, or they're Steve Welby's initiatives, right? This focus on speed of innovation is kind of driven by kind of an external reality. We're trying to posture the department to be able to compete in a more competitive global technology department. Whatever administration comes in next, and the administration after that, is going to have to deal with those external requirements. I think we're trying to posture ourselves in a place where our successors will say we started them down the right kind of road and started creating opportunities and hedges for them to face that future. I think that the focus we have is really about that long term. It's not about any individual initiative, right, it's about are we positioning the department right for that long-term picture, and that's the test I use on the investments we're making. And, I think the things pass that test.

Aaron Mehta was deputy editor and senior Pentagon correspondent for Defense News, covering policy, strategy and acquisition at the highest levels of the Defense Department and its international partners.

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