How can the government innovate at scale while remaining agile and cost-effective? CXOTalk host, Michael Krigsman, speaks with two prominent leaders to explore this important question.

Mr. Jim Geurts was sworn in as Assistant Secretary of the Navy for Research, Development & Acquisition (ASN (RD&A)), following his confirmation by the Senate November 2017. As the Navy’s acquisition executive, Mr. Geurts has oversight of an annual budget in excess of $60 billion and is responsible for equipping and supporting the finest Sailors and Marines in the world with the best platforms, systems and technology as they operate around the globe in defense of the Nation.

Mr. Geurts previously served as the Acquisition Executive, U.S.. Special Operations Command (USSOCOM), at MacDill Air Force Base (AFB), Florida, where he was responsible for all special operations forces acquisition, technology and logistics. In this position his innovative leadership and technological ingenuity provided rapid and affordable acquisition that positively impacted the USSOCOM acquisition work force and the special operations forces capability on the battlefield. These contributions were recognized by both private and public institutions during his tenure to include earning the Presidential Rank Award, USSOCOM Medal, William Perry Award and Federal Times Vanguard Award for Executive of the Year.

Dr. David A. Bray was named one of the top "24 Americans Who Are Changing the World" under 40 by Business Insider in 2016. He was also named a Young Global Leader by the World Economic Forum for 2016-2021. He also accepted a role of Co-Chair for an IEEE Committee focused on Artificial Intelligence, automated systems, and innovative policies globally for 2016-2017 and has been serving as a Visiting Executive In-Residence at Harvard University since 2015. He has also been named a Marshall Memorial Fellow for 2017-2018 and will travel to Europe to discuss Trans-Atlantic issues of common concern including exponential technologies and the global future ahead. Since 2017, he serves as Executive Director for the People-Centered Internet coalition co-founded by Vint Cerf, focused on providing support and expertise for community-focused projects that measurably improve people's lives using the internet. He also provides strategy and advises start-ups espousing human-centric principles to technology-enabled decision making in complex environments.

Transcript

Michael Krigsman: How do you run an agile organization at scale? When I mean scale, I mean billions and billions and billions of dollars in budget and hundreds of thousands of people. Today, on Episode #296 of CXOTalk, that is what we are discussing. I'm Michael Krigsman. I'm an industry analyst and the host of CXOTalk.

Now, before we begin, I want you to, right this second, please, subscribe on YouTube and tell your friends, tell your family to come watch right now.

I'm very thrilled today. We have two amazing guests. David Bray is the executive director of  People Centered Internet, and he is today my guest co-host. He's also a subject matter expert on the topics that we are discussing. Hey, David. How are you? It's great to see you back on CXOTalk again.

Dr. David Bray: It's great to be with you, Michael. Thanks for having me.

Michael Krigsman: Fantastic. James "Hondo" Geurts is the assistant secretary of the Navy who is responsible for acquisitions and technology. Hondo, how are you? Thank you. This is your first time on CXOTalk, and we're just thrilled you're here.

Jim Geurts: Yeah. It's awesome to be part of the show here and look forward to talking with you.

Michael Krigsman: Okay. Let me ask you both briefly to describe your work. David, why don't we begin with you? Just very briefly tell us about People Centered Internet.

Dr. David Bray: I'll be very brief because, really, the star of the show is the Assistant Secretary. People Centered Internet is a coalition aimed at making sure we can have the future Internet that benefits us all versus just a few. We try to do demonstration projects that measurably improve people's lives. One of our co-founders and chairs is Vint Cerf, and so we are really focused on the unfinished work of the Internet going forward.

Michael Krigsman: Wonderful. I know it's a topic that you're very passionate about. Hondo, would you briefly tell us about your role as the assistant secretary of the Navy?

Jim Geurts: Sure. I've got the great pleasure of leading and supporting a team of about 60,000 folks who develop, field, and support all the technology, equipment, and services for all the Navy and Marine Corp.

Michael Krigsman: Okay. Clearly, this is a very large role. What are the focus points? What are your objectives in this role?

Jim Geurts: Yeah, sure, absolutely. It is about a $60 billion a year enterprise focused on supporting all our marines and sailors all over the world. The real focus there is delivering and supporting them around the world and making sure they've got the equipment, the latest technology, and all the support they need because they're doing the nation's work worldwide, and we need to be there supporting them.

The big piece of that is delivering reliability, being very agile in our support, making sure we're good stewards of the taxpayer and being affordable. Then, most importantly, developing our talent so we can sustain that capability and sustain the nation's defense for the future ahead.

Michael Krigsman: You raise a key point. You mention the term "agile." I guess it gets right to the very heart of what we're talking about today. With an organization of that size and scope, how is it possible to be agile? And, in that context, what does agile actually mean?

Jim Geurts: Yeah, it's a great question and, I think, a great challenge. Obviously, you can't do that without a vision and a mission to rally around. The great news for us is, I can't think of a better mission supporting our sailors and marines all around the world.

The first key is wrapping what we do around them. Agility, to me, I think we use the "innovation" word a lot. That's a little harder for me to understand. Agility, to me, is, how fast can we pivot to new problems, adapt to new circumstances, and then create the future we want, not just react to it?

Michael Krigsman: Innovation: you don't like innovation. David, I'd love for you to also weigh in on the distinctions

Michael Krigsman: How do you run an agile organization at scale? When I mean scale, I mean billions and billions and billions of dollars in budget and hundreds of thousands of people. Today, on Episode #296 of CXOTalk, that is what we are discussing. I'm Michael Krigsman. I'm an industry analyst and the host of CXOTalk.

Now, before we begin, I want you to, right this second, please, subscribe on YouTube and tell your friends, tell your family to come watch right now.

I'm very thrilled today. We have two amazing guests. David Bray is the executive director of  People Centered Internet, and he is today my guest co-host. He's also a subject matter expert on the topics that we are discussing. Hey, David. How are you? It's great to see you back on CXOTalk again.

Dr. David Bray: It's great to be with you, Michael. Thanks for having me.

Michael Krigsman: Fantastic. James "Hondo" Geurts is the assistant secretary of the Navy who is responsible for acquisitions and technology. Hondo, how are you? Thank you. This is your first time on CXOTalk, and we're just thrilled you're here.

Jim Geurts: Yeah. It's awesome to be part of the show here and look forward to talking with you.

Michael Krigsman: Okay. Let me ask you both briefly to describe your work. David, why don't we begin with you? Just very briefly tell us about People Centered Internet.

Dr. David Bray: I'll be very brief because, really, the star of the show is the Assistant Secretary. People Centered Internet is a coalition aimed at making sure we can have the future Internet that benefits us all versus just a few. We try to do demonstration projects that measurably improve people's lives. One of our co-founders and chairs is Vint Cerf, and so we are really focused on the unfinished work of the Internet going forward.

Michael Krigsman: Wonderful. I know it's a topic that you're very passionate about. Hondo, would you briefly tell us about your role as the assistant secretary of the Navy?

Jim Geurts: Sure. I've got the great pleasure of leading and supporting a team of about 60,000 folks who develop, field, and support all the technology, equipment, and services for all the Navy and Marine Corp.

Michael Krigsman: Okay. Clearly, this is a very large role. What are the focus points? What are your objectives in this role?

Jim Geurts: Yeah, sure, absolutely. It is about a $60 billion a year enterprise focused on supporting all our marines and sailors all over the world. The real focus there is delivering and supporting them around the world and making sure they've got the equipment, the latest technology, and all the support they need because they're doing the nation's work worldwide, and we need to be there supporting them.

The big piece of that is delivering reliability, being very agile in our support, making sure we're good stewards of the taxpayer and being affordable. Then, most importantly, developing our talent so we can sustain that capability and sustain the nation's defense for the future ahead.

Michael Krigsman: You raise a key point. You mention the term "agile." I guess it gets right to the very heart of what we're talking about today. With an organization of that size and scope, how is it possible to be agile? And, in that context, what does agile actually mean?

Jim Geurts: Yeah, it's a great question and, I think, a great challenge. Obviously, you can't do that without a vision and a mission to rally around. The great news for us is, I can't think of a better mission supporting our sailors and marines all around the world.

The first key is wrapping what we do around them. Agility, to me, I think we use the "innovation" word a lot. That's a little harder for me to understand. Agility, to me, is, how fast can we pivot to new problems, adapt to new circumstances, and then create the future we want, not just react to it?

Michael Krigsman: Innovation: you don't like innovation. David, I'd love for you to also weigh in on the distinctions between innovation and agility for an organization of this type.

Dr. David Bray: Sure. I just want to recognize what Secretary Geurts, or if we can use your nickname, Hondo.

Jim Geurts: Hondo. Yeah.

Dr. David Bray: He goes by Hondo, so we'll use that.

Jim Geurts: Yeah. Mm-hmm.

Dr. David Bray: I think it was very key, what he was saying, in the sense that it's important to talk about the outcomes you want. Too often we use the word "innovation" almost like a buzzword, and it becomes almost like pixie dust that we sprinkle on everything.

What I really have the respect for is actually thinking about what are the outcomes we want to have achieved? So, we can be for innovation, but it's a means towards a more specific outcome that could be, for example, how do we have more pivot speed or faster speed? How do we have more agility in it? How do we more adaptable?

To me, this is really the fundamental challenge of the world is changing so rapidly, externally. In fact, one might even say we're in a period of exponential change.

Jim Geurts: Mm-hmm.

Dr. David Bray: That our ways that we used to do things in the 1950s or the 1960s, it just doesn't scale for this period of accelerated external change. In a perfect world, you'd be a small startup, but I don't think the Navy has the luxury of saying, "Let's start from scratch and become a small startup." [Laughter]

Jim Geurts: [Laughter]

Dr. David Bray: And so, it's this really interesting and important challenge for how you take large organizations and make them as nimble and adaptive as what small startups can do; at the same time, do the important mission that the Navy does around the world.

Jim Geurts: Yeah. What's interesting, I came from being in special operations command, which is, at least within the government, thought of as a very small, nimble organization. Looking at the challenge of getting a small organization feel and big organizational size is a great challenge and opportunity.

A couple of ways we're getting after that is, I think you've got to be very comfortable with decentralization. Rather than trying to make the big organization look like a small one, make your big organization look like lots of small organizations, which all have their vision and focus area synchronized. But, if you try and control it all in one centralized hierarchy, it gets really, really challenging.

Innovation at scale, to me, is about how you break down these large organizations. You have to have a consistent vision and mission, but you've got to have comfort letting them task, organize, and execute their own way.

Michael Krigsman: Well, in principle, in theory, this sounds fairly straightforward. But, I suspect that the execution of it is a little bit more difficult. How do you go about, in a practical way, putting this into practice?

Jim Geurts: Yeah. Again, I think you start with a common vision and mission focus. Then you break down and decentralize to the lowest layer of accountable and capable decision-making. It's a little bit counterintuitive. You decentralize, but then you try and increase your transparency, so you don't create lots of little silos. Getting that balance is challenging, and so we've been working hard at that. It takes a pretty agile knowledge management system.

I think another big piece of it is proving. It's all about culture and talent and proving to your organization that you actually have their back and that you're there to support them, not to just knock them upside the head when they do something wrong. Getting that organizational trust is a real key element of it. It takes a lot of leadership, thought, and talent development.

I don't know, David, from your experiences.

Dr. David Bray: Oh yeah. [Laughter]

Jim Geurts: Yeah.

Dr. David Bray: As you know, Michael, I've had experiences in different roles where a similar sort of challenge of how you move fast and also, as Hondo said, "How do you build trust?" because you're asking people to do something different than they're used to doing. They may have been doing it the same way for 10 or 15 years. That is very disorienting to people.

It's the level of sort of showing you have their back, that you're there to be their human flak jacket. When something goes wrong, you take the hit. You don't necessarily have it sprinkle and flow on down to them. That's something that also has to be communicated in a very challenging environment in which we're underneath public scrutiny.

Jim Geurts: Right.

Dr. David Bray: We have to have those conversations as well.

The other thing that I thought that Hondo said that was really key is, there's Professor Tom Malone at MIT who talks about collective intelligence, which is both the human workforce element, but also technology element, being collectively smarter together.

Jim Geurts: Right.

Dr. David Bray: I think this is key as to how we're going to deal with the information overload challenges, the transparency necessary to collaborate synchronistical across the organization in a distributed sense and, at the same time, some of it is also going to require some experiments--

Jim Geurts: Right.

Dr. David Bray: --because this has never been done before at the scale that you're doing it.

Jim Geurts: Right.

Dr. David Bray: [Laughter]

Jim Geurts: Another key concept for me is differentiation. You also don't want to fall in the trap of going from a more bureaucratic organization to just completely free for all. I think a lot about creating multi-dexterous organizations. In the Navy, we're building aircraft carriers and submarines that are going to last for 50 years. How I think about building those with the safety and security we need there is a little bit different than how I think about the combat systems on those submarines and aircraft carriers. We want to change every 12 months, 18 months, maybe every day, and so you've got to differentiate the work and kind of get away from a one-size-fits-all process.

I've seen some folks try and move the whole organization to a rapid innovation organization. That may not be the right answer either. Sorting that out and then sorting your talent out and your processes out that they can handle both sides of that spectrum is a challenge but, I think, when you focus on that, you can get away from a kind of flash in the pan innovation that many people have experienced.

Michael Krigsman: Now, I just want to remind everybody that, as we're talking with Assistant Secretary of the Navy, Hondo Geurts, and with David Bray, who is the executive director of People Centered Internet, there is a tweet chat taking place right now using the hashtag #CXOTalk. You can ask questions. In fact, we have really interesting question from Gus Bekdash, who makes the point that when you are conducting research, you don't always have a clear understanding of the outcomes. And so, in an environment where control and really managing risk is so important, how do you deal with the uncertainty of outcomes.

Jim Geurts: I think I'd go back a little bit to differentiating the work and understanding risk and opportunity. I think sometimes we get too focused on managing risk and not leveraging opportunity. As we differentiate the work, we think about research, learn fast, and rapid iteration speed, that's where you want to be efficient in doing a lot of things quickly and then leveraging the things that worked and moving past the things that didn't work.

You don't necessarily want to do that in a, say, major ship construction that takes multiple billion dollars and multiple years that you're going to have for 50 years. Playing those two skills together is important. You don't want to do innovative research like you do a nuclear submarine, and you don't want to do nuclear submarines, necessarily, like you do innovative research. Having an organization that can respect that diversity of purpose and process, that's a lot of what we're doing here. Instead of fighting the diversity, leveraging it, and using it as your key enablers.

Dr. David Bray: Actually, to build on what Hondo said, the research actually shows that diversity, both in terms of experiences and approaches, but also in terms of processes, actually does benefit an organization better. It's not trying to be a monoculture or one size fits all.

The other thing that I think Hondo said that was really key is recognizing it's not just about risk management, but also about opportunity management and how you can be a fast learning organization.

Jim Geurts: Mm-hmm.

Dr. David Bray: One of the things I like to talk about as well; Project CORONA in 1958, 1959, was an attempt to launch a rocket that would take a photo of the Soviet Union, parachute a film canister that would then be picked up before it landed into the ocean. This was 1958, 1959, way before the space race.

Jim Geurts: Mm-hmm.

Dr. David Bray: The first 13 rockets blew up on the launchpad. It wasn't until about attempt number 21, 22 that it finally succeeded, and it turned out to be a very useful benefit during the Cold War. But, even more interestingly, it was later declassified in 1995, bought by a company that was later bought by Google and became basis for Google Maps.

Jim Geurts: Right.

Dr. David Bray: That investment that happened back in 1950s, 1960s, was a sort of huge return on investment. But, imagine nowadays we try to do something like that. How long would it be before attempt number five or six with the rockets before someone says, "We need to have a hearing. What's going on over here?"

You have to say, "What are the opportunities in addition to risk management?" As Hondo said, when it comes to building something that's nuclear powered or something like that, maybe you want to be much more on the risk management side. But, when it comes to actually doing things that move us forward and are those bets that play to the future, maybe you want to be bold, be brave, and benevolent more on that side because that's necessary for the future ahead.

Jim Geurts: Right. That ambidextrous organization is really, I think, a key piece of it. But, you've got to have focus, and you've got to have a kind of higher purpose in mind. Grounding both ends of that spectrum in the mission is critical.

Michael Krigsman: Now, as I was speaking, Hondo, with your team in preparation for this conversation, I have to give a shout out to Danny because he is awesome, Danny on Hondo's team. He was talking about the concept of a minimum viable product, really talking in startup terms. I thought that was striking given the difference in resources, obviously, and scale of a small company relative to the Navy, as an organization. Yet, you're trying to embrace those kind of startup concepts. Maybe you can elaborate on that a little bit.

Jim Geurts: Yeah, absolutely. Certainly, a lot of my experience in special operations command has shaped it, but I think the Navy, historically, has also done a pretty good job of this, if you look back to the early submarines or naval aviation. Some of it is just relearning some of those skills. One of the things I've found is, if you can close the distance down between operator, technologist, and acquisition person, you can get that iteration rate up, and you can think of things in terms of multiple product cycles back-to-back.

Folks now talk about agile software. You can do the same thing in programs. You can build your first prototype. If that works, then you can build on it. If it doesn't work, then you can stop and pivot to a different direction.

The trick is, too often we've let the developer define the minimum viable product. It's really got to be the operator that defines it. And so, that dialog is really critical.

We're doing a lot of work with how we improve our communication with end users and get our speed up, and so we can get rapid turning iterations. The other value that gives us is, if we need to, we can take those products immediately into the field and provide capability to the soldiers, sailors, and marines. If they're not quite mature, then we can keep maturing those products along a path, but it'll be much better informed with that input.

Michael Krigsman: Your goal then is to get, when you say the operators, essentially, the end users involved in the acquisition process so that that chain is very direct. I'm not trying to put words in your mouth. I'm interpreting that the chain is very short and, therefore, the people who are the developers, the manufacturers, are much closer to the actual needs of the users without so many intermediaries. Is that a correct interpretation?

Jim Geurts: Yeah, sure. Another way to think of it is, traditionally, government acquisition has been very transactional. The user community will come up with a requirement. They'll hand that to the budgeting folks. They'll budget the money. When the money is budgeted, we'll start the acquisition. When the acquisition is done, we'll hand it back to the user.

Think about making those much more parallel processes. One of the things the Navy and Marine Corp. has done really, I think, an important job is, there's actually a forum where I will sit down with the chief of naval operations or the commandant in the Marine Corp., the most senior military members of the service, and we'll look at a problem together with our collective staffs so we can agree on what's the minimal viable product, what are the different paths to get there, how quickly can we get that into the field, and move away from a multiyear transactional kind of process?

Dr. David Bray: To build on what Hondo was saying, Michael, I think it's really key that it's a learning organization.

Jim Geurts: Right.

Dr. David Bray: It's a learning organization in parallel as opposed to waiting for things in series because it's not necessarily that you can have the luxury of waiting that long for things to play themselves out.

Jim Geurts: Right.

Dr. David Bray: Everybody is involved, and you've empowered the operators to say what they need, but you've also brought the top level leadership to be present at the same time, so everyone is mutually learning, and they're sort of accelerating that feedback loop. In some respects, you're taking what was talked about how you move from waterfall processes to agile in the software world, and you're doing it for the entire organization.

Jim Geurts: Right. We're trying to. Again, doing that at scale with the kinds of dollars we're talking about can be challenging, so the other piece is to break the work down into smaller projects and so it's not the big bang theory all the time. You can have pieces of products you can move forward at different rates.

It's all going back to, the national defense strategy is pretty clear. We need to compete and win in the future kind of global environment. We are not going to do that doing business as usual, either in terms of processes or doing the things we've always done. We're trying to take advantage of this great revolution that's occurring in collaboration, user-based design, parallel processing, and startup, and apply that to very large, traditionally bureaucratic organizations. Great challenge; great opportunity.

Dr. David Bray: [Laughter] I have to give a shout out to Hondo because, remember, this is all about making the battleship turn faster.

Jim Geurts: Right.

Dr. David Bray: You chose the mission impossible. [Laughter]

Jim Geurts: [Laughter] Yeah.

Michael Krigsman: We have another question from Twitter. Arsalan Khan is asking whether you distinguish between organizational innovation--I know you don't like that term--between organizational innovation and the individual contributions that people make. How do you distinguish, and how do you harness both of those things, the individual and the organization?

Jim Geurts: Yeah, and that's a fabulous question. We could talk, and we can talk days on people and culture. If you don't have the right talent and the right culture, the processes aren't going to get you there.

What I look forward to doing is create the environment where we leverage diversity, whether that's in skillset, process, or technical knowledge towards a collective mission. In that sense, I think, if you can create an environment that people are empowered, that they're valued for what they bring to the table no matter where they come from, and that the organization can quickly capitalize on ideas as they come up, whether it's bottom up, top down, sideways, or in between, then I think you can get both individually-based innovation, technology innovation, and organizational innovation.

I think, if you try and do each of those separate, kind of as the question implied, it's really hard to get there. I think, if people understand the mission and feel comfortable in the culture, the innovations will pop up. If they don't, then those innovations will be fighting upstream, and it can get really challenging to unlock the power.

Part of my leadership view is, how do you unlock discretionary effort? I think that's what startups do well. They can unlock that thirst in power and bring everybody together with a sense of urgency. That's what the secretary of Navy is looking for. How do we operate with a sense of urgency individually and organizationally? The only way you can do that is unlocking the culture and then allowing the talent to take you there.

Dr. David Bray: To build on that and, also, you've talked and maybe you could share a little bit, the incentives you give your staff and your team. It's both the idea that there's individual recognition, but you can also do unit citations or recognize units.

Jim Geurts: Right.

Dr. David Bray: You can recognize both the individual and the group. Then also, it indicates that you ask people to intentionally have, as one of their performance criteria, something that might not work out. Could you elaborate a little bit there about that?

Jim Geurts: Yeah, it's interesting. Everybody has talked about fail faster, and we want you to take it to the edge of the boundary, but we never measure folks for that. The number one reportable item on all my folks' performance reports is, they've got to do at least one major initiative every year that's got a chance of failing of at least 50%.

Now again, judgment is used here, so we don't want to fail at the law, or we don't want to fail at something that would make somebody unsafe. But, I have found, if you don't make that part of the way you measure performance, you'll never get the performance. I've also found, most folks just want to feel like what they're working on is important and their effort means something.

The good news in my job is we've got a great mission helping to protect the country and enable our sailors and marines. Most of the recognition really is just that folks' ideas can really help and are valued. They're not working in just a bureaucratic process piece. I don't know if that gets at what you were going for, David.

Dr. David Bray: Exactly. Exactly, it's all about that sense of purpose and the inspiration.

Jim Geurts: Yeah.

Dr. David Bray: And what gets rewarded. What you measure is what is going to be rewarded is what actually gets done. I think that's how you inspire people.

Michael Krigsman: I have to assume that creating that culture of failing fast and iteration in a highly risk adverse environment, again, has got to be easier said than done.

Jim Geurts: Yeah, absolutely. I don't like the term "fail fast." I like "learn fast." Right? We're not here to fail, but we are here to learn.

Then, I think, if you can manage where you want to take risk and where you don't, back to this differentiating the work, then you can have both. That's what we're really after, especially in an organization of this size. But, you've got to talk very bluntly about that internally and with the workforce. They've got to have the trust that the leadership will be there to support them.

When I think of an org chart, I am at the bottom of the org chart.

Dr. David Bray: [Laughter]

Jim Geurts: My job is to support everybody above me, give them the culture, give them the trust, and let them go attack the problem. Kind of be the pulling guard on the football team, not the quarterback.

Michael Krigsman: How do you measure these kinds of results?

Jim Geurts: Yeah, I think you can measure it in a lot of different ways. It's one of those that's hard to measure discretely, although you've got to actually track output. But, I've also found, if you create the workplace of choice, you get the choice of the best workforce.

The way I measure it is organizational output. I look at the output. I'm not a process measurement person as much as an output focus. I think if you can focus on the output and then drive the culture and the norms, then that helps; that helps really get there. But, you've got to have it.

You've got to be grounded in output. Are we improving our ability to support the sailors and the marines? That's my bottom line. There are 100 little measurements in between, but it's all about supporting the folks out there on the line that we're here for.

Michael Krigsman: You're looking very clearly at the outcomes rather than just achieving certain process milestones. You're looking at correlating to results.

Dr. David Bray: Yeah.

Jim Geurts: Yeah.

Dr. David Bray: Exactly. What Hondo was saying is it's the output the matters.

Jim Geurts: Right.

Dr. David Bray: At the end of the day, there are several things internally that may give you a sign you're going in the right direction, but if you're not actually addressing the soldiers, the sailors, the workforce as a whole, then you're actually going to miss that opportunity. You're going to be missing and not looking in the right place.

That also helps with the whole mantra of one team, one mission.

Jim Geurts: Mm-hmm.

Dr. David Bray: Focus on what really matters. I think it's, in some respects, trying to encourage an entrepreneurial spirit within the workforce as a whole to be creative problem solvers for how we can get things done better. It's that idea, again, like you talked about, where you're trying to incentivize and motivate people to focus on how we can go beyond just trying to meet our own job descriptions but learn from this.

I really liked how you said it. It is about learn fast and recognize that has to be a conversation we have outside, beyond just the workforce as a whole.

We also have to have conversations with the public and say, "Look, the Navy that you knew in the 1950s and 1960s is still going to hold true to its principles, but it's got to figure out how to move in this exponentially changing world in a different way." And so, we need to recognize that, one, we want to bring that talent in, so come here if you want to be that sort of change agent or that new navigator of how to navigate this new landscape. Then, two, we want to work with different partners in how we're going to actually move this forward as well because it can't just be one group that solves it all.

There is no textbook for how to do this at the size that you're doing. I had it on a smaller size. But, even then, that was nowhere near the size you've got and the challenges you've got. I think, looking back 10 to 15 years from now, we'll say these were the moments that we figured out how to make organizations be able to survive in an exponential era, and it's going to require some experiments, some learning, and exactly the idea of leaders that are willing to be there for their team to take the flak and to be the ones that sponsor and encourage them to move forward.

Jim Geurts: Yeah. We haven't talked technology, per se, and I think organizational innovation is somewhat separate from technology. But, there are some state changes in technology in terms of artificial intelligence and digital connectedness, all the way through digital design.

Part of what we've also got to do is create the culture that we are as willing to prototype in process and how to use that technology in how we think about building and supplying the troops, not just the technology on the battlefield. It's a really interesting thought on digital-based system engineering, digital-based shipbuilding. For the first time, now we have ships where we have full digital models before we build them. That enables a whole other way of thinking in terms of how we manage that and how we actually get the work done.

I think, if you can make those problems available to the workforce in a culture that they feel like they can go off, try things, and push for better benefit, then we've got a huge opportunity ahead of us. If we can get the culture right, then you can get away from kind of flash in the pan initiatives and get into sustainable innovation, not just monthly innovation, daily innovation, or even annual innovation. You can get on a completely different trajectory.

Michael Krigsman: Can you talk a little bit more about the digital capabilities that you're developing, and maybe just give some context for the people listening who may not have the background to appreciate what having a digital model of a ship actually means and involves?

Jim Geurts: Yeah, and I'll maybe talk about it in two different dimensions. One dimension is building new ships. We have two of the most complex models in the world. One is a nuclear submarine, and one is a nuclear aircraft carrier. Traditionally, tens of millions of manhours to build and design.

Now, if you can start with design tools, you can create better designs from the start. There's an element of, how do you design it better? Then that can move right into, how do you build it better? Once it's built, then how do you sustain it better?

Technology is also letting us take traditional ships that were built by the older methods, and now you can digitally scan those ships. When we need to repair the ships, you know exactly what that ship looks like as it comes in for its repair.

It's for everything from planning the work to certifying the work. Imagine a visual or augmented reality as you're checking off work, and you can compare to a picture. If it matches a picture, you're done. You don't have to measure with protractors and kind of the old school. Then, that's in construction, which traditionally is sweat and muscle work.

On the combat systems stuff, you can imagine getting all the way to the point where I can upload a new app to my ship in a day and create a whole new capability to address a new mission challenge, something else we've learned, or a new threat. Both of those are, I think, really going to drive some innovation in the way we think about traditional Navy programs.

Michael Krigsman: Because I'm a geek, I have to ask. Regarding the augmented reality capabilities, you were just describing, are you actually using that? I've seen software vendors give me demos of AR in manufacturing, but the headsets are too big. They're sort of prototypes. I haven't really seen it being used in a big way. Are you?

Jim Geurts: Yeah, if you go to some of our shipyards now, what's interesting is you would kind of think that it would only be the new generation of somebody who has just joined in the last couple of years that would adopt it. What's really fascinating, once you show what's possible to, say, a master shipbuilder, they can put together the practical knowledge with the new technology to really get some impressive results, and the adoption rate is really going up. Doing this at scale obviously is a challenge.

The other piece that we don't talk enough about in AI is how to help train folks faster. About 50% of our shipbuilders have less than 5 years' experience. I can wait 20 years until they have 25 years' experience, or I can look for new methods to give them the same experience level much more quickly.

That's another very interesting thing. There's a boom in our requirements for shipbuilders, and so how do we address that workforce challenge? Technology is going to play a big piece in it.

Dr. David Bray: To get to your question, Michael, yes, I think we've seen some things in the Valley that maybe aren't ready for prime time yet coming out of California and other places around the United States, but the benefit of what the Navy's culture and environment has is, they've got a mission; they've got to get things done. They've got to make it work. Part of what's sort of the ethos of that culture is you work with what you've got, and you make it work.

Jim Geurts: Right.

Dr. David Bray: Even if it's necessarily uncomfortable initially, you'll figure out a way to actually work it into the environment. If you've ever been on a ship, there are some pretty tight quarters, but they make it work. I share that because I think, in some respects, that positive pressure to make it work with what you've got at hand, even if it's still in a prototype phase or something like that, and then have that sort of be shared amongst the crew as a whole, that actually creates the right environment that makes sure what you're producing is actually towards an outcome that is positive versus just an interesting thought experiment that doesn't go anywhere.

Jim Geurts: Yeah, there's nothing like a real problem to help speed the acceleration of technology. Your conversation on minimal viable product, I think we're at the point where there are a number of minimal viable products that will really help us move forward.

Our challenge is how to scale in this arena and create the real state change we're looking for because, quite frankly, for the American taxpayer, we've got to drive costs out of these large programs. For our warfighter, we've got to deliver the equipment more reliably, more quickly. These technologies help us really drive down some fundamental new innovation paths that weren't available to us 20 years ago.

Michael Krigsman: A lot of the people who watch this show are technologists, and so one of the things that I'm wondering, and I'm sure other people will as well is, when you talk about these technologies, to what extent are you developing the technology yourself, and to what extent are you using off-the-shelf software and/or hardware?

Jim Geurts: I think if anybody has ever followed me, they know I'm not that smart, but I'm a pretty good poacher. If somebody is already done it, the fastest way to get there is to take what they've done and move it forward.

I would say it's a mix. There's a lot of base technology out there, but there's innovation required in thinking about how to apply the technology in new ways. That's different than a pure technology innovation.

Where we've had really good luck is, again, I talked about closing that distance down between the end user, the developer, and the buyer. What I found in my time at special operations command was, there was a lot of technology available to solve problems. We didn't know to ask for the technology, and the technologist didn't know how we might apply it.

Another thing we're doing in the Navy is really creating collaboration points for that to occur, especially with nontraditional small businesses. We've awarded a number of consortium kind of contracts, which are commercial-based contracts that will allow us, I think, a much broader way to interact at a much less iteration cost. Speed is an enabler. Velocity is a competitive advantage. I've got a lot of folks thinking about how to best put together those models. I think the Navy is out in front in many of those regards.

Michael Krigsman: I love what you said: "Velocity is our competitive advantage." David, we have less than ten minutes left. What should we ask Hondo that we haven't already that is really important that we should talk about in the last ten minutes?

Dr. David Bray: We've definitely covered the whole gamut of what you're trying to look at. I guess I would ask a two-part question, which is, first, are there ways that people on the outside that may want to engage, maybe not to sell you something, because there are processes for that, but more if they have ideas or they have insights? Are there ways they can engage the Navy and help sort of move things forward?

Then the other thing would be, as a senior executive, you have only so many hours in the day. How do you both renew and sustain yourself, and how do you also sort of learn from others in terms of how to have the same energy and enthusiasm to keep up with this exponentially changing world?

Jim Geurts: Yeah, maybe I'll take the last one first and then wrap back around. I think part of it is, as a senior leader, you have to be somewhat comfortable not controlling it. Creating the right vision, creating the right right and left parameters, but not feeling like everything has got to be controlled by you specifically, even though you're likely responsible for it. I've learned that over the years, and you've got to be comfortable in that.

The second piece is being able to create enough time, so you can plan for the unplanned. Thinking about what might happen, it gets back to this velocity. Being able to think, you may not know exactly what the new problem is but, if you think about your organization and tailor it to be able to pivot to a new problem as it pops up, I think has been helpful.

To your first question, we're trying to make that easier, both in terms of getting the word out here or opportunity spaces to interact. Quite frankly, also, even in the business, making the business much easier. I think, as you watch a lot of our consortiums, we've got things called Warfare Centers all across the country. My job is to help get the word out and create those touchpoints that enable great folks to help the military.

One of my greatest fears in life is, there's a good idea somewhere out there in the country and it can't get to the person that can action it. And so, I'm confident everybody in the country wants to help our military. I'm not as confident they know how, and that's part of where I'm spending a lot of my, I would say, future thinking. Again, the challenge is freeing up the time to do it.

Dr. David Bray: Yep.

Jim Geurts: But again, even great forums like this just to talk openly about the challenges and the opportunities, I think, help better connect our military to the population, and we've got some big challenges. We're not going to get there on our own. We're going to get there with the power of everybody working together. I've got to enable that better from my position.

Dr. David Bray: Michael, I want to actually just footnote what Hondo said. I think we should actually call it Hondo's Law. We had Joy's Law, which is, no matter where you go, most of the best people work for someone else. But, I think we should have Hondo's Law, which was, his greatest fear is somewhere out there is someone who has a good idea for the country, but they can't get it to someone that can action it. I think we should actually sort of memorialize that because that is the challenge that we're facing with public service is, it can't just be done by all of us internally.

Jim Geurts: Right.

Dr. David Bray: I say that now as someone who is sort of on the outside now. But, even then, I look at what's going on, and I think this is maybe one of the first times you've had an assistant secretary on your show. But, if we only talk about what's going on in the private sector and in Silicon Valley, and we don't talk about what needs to also happen in the areas of public service, we in the United States will not be as strong as we could be, and we as a world as well. I think what you said there was really key about how we make sure we get those people that have good ideas for the country to an individual that can help action it.

Jim Geurts: Right. Not just that at the company level. I'm fascinated by the power of crowdsourcing and taking the unique ideas. We've seen in some of our price challenges and less traditional transactional technology efforts, there are great ideas all around the country. The degree we can leverage those and enable Americans to help Americans, even when it's part of our military, I think there's great potential there because there are great challenges, and we can't solve them all on our own.

Michael Krigsman: Well, then why don't we finish up with one last question, which is, what advice do you have for people out there who have great ideas? Let me actually make this on two sides. What advice do you have for people out there who might have great ideas and, at the same time, what advice do you have for people inside the government and inside the military who want to locate those ideas?

Jim Geurts: Yeah. I think, on the government side, it's really about creating platforms that enable us to capture new ideas and interactions on a huge scale, not on a one-by-one, much more transactional area. You're seeing us doing much more engagement, getting our problems out there, experimenting more, and being more comfortable looking at things in early development or that might be purely commercial. I would just say, for the folks inside the system, there are great ideas everywhere, some within government, many outside government. Figure out how to leverage all the great ideas out there.

If you're out there and have great ideas, if you don't know how, get a hold of me, but look for and we're pretty active in social media. We're active in LinkedIn. We're active on Facebook and whatnot. We put a lot of things out in broad area announcements or experiment announcements. Look for those and give us your ideas. Again, I've got a create the system that will look at all of those and create new ways to interact.

Dr. David Bray: Michael, if I can just add one more thing to what Hondo said, which is, whether you're on the inside or you're on the outside and you have an idea, make sure to focus on the outcome.

Jim Geurts: Right.

Dr. David Bray: Don't sell it because it's innovative or because it's shiny. Make the case as to how does this increase pivot speed, how does it make things more agile or more adaptive, or more resilient. What is the benefit to the operator? What is the benefit to the sailor, the folks that are out there on the line? I think, if you have that value proposition up front, it will lead it and make it more possible to be actioned on if you have that in mind is a focus on the outcome as to what you actually achieve.

Jim Geurts: Yeah, that's a great point, David.

Michael Krigsman: That's great advice: Focus on the outcomes. We're out of time. I hope you'll both come back, and we can do this again another time.

Jim Geurts: Yeah. Thank you very much for the opportunity.

Dr. David Bray: Thank you, as always, Michael.

Michael Krigsman: A huge thank you to Hondo Geurts, who is the assistant secretary of the Navy, responsible for acquisitions and technology, and to my old friend David Bray, who has certainly been on this show a number of times before, who is the executive director of People Centered Internet.

I'm Michael Krigsman. You have been watching Episode #296 of CXOTalk. We have amazing shows coming up. Don't forget; subscribe on YouTube. Do that right now, please, and tell all your friends, also. Tell your friends and your family.

Okay, everybody. Have a great week, and we will see you again next time. Bye-bye.