WEBVTT 00:00.600 --> 00:02.340 - Ladies and gentlemen, please join me 00:02.340 --> 00:05.670 in welcoming Deputy Secretary Shanahan. 00:06.022 --> 00:09.022 (audience applause) 00:19.110 --> 00:22.070 - I think I'm in the category of make things happen, 00:23.680 --> 00:24.740 not the policy group. 00:24.740 --> 00:26.440 So hey good morning everybody. 00:28.540 --> 00:30.380 Boy, that was kinda soft. 00:31.010 --> 00:31.843 Came all the way. 00:31.843 --> 00:34.220 You know, it's great to be out of Washington, D.C.. 00:34.360 --> 00:36.780 This is uh, grew up on the West Coast 00:36.780 --> 00:38.420 it's always great to be back on the West Coast 00:38.420 --> 00:41.180 so it's a pleasure to have this opportunity 00:41.220 --> 00:42.053 to talk to you today. 00:42.053 --> 00:46.060 So Vice Admiral Daley, thank you for that warm introduction 00:46.060 --> 00:49.120 and a little bit before the remarks this morning 00:49.120 --> 00:50.700 I had a chance to go back and visit 00:50.700 --> 00:54.030 some of the booths, and ran into a number of 00:54.850 --> 00:57.870 former colleagues and friends, and it's just good 00:57.870 --> 01:01.300 to be able to rub elbows with industry. 01:02.100 --> 01:03.740 Spent 30 years doing that, it's kind of fun 01:03.740 --> 01:05.480 to be back in that forum. 01:06.240 --> 01:08.308 Maybe just as a preface to my remarks, 01:08.308 --> 01:10.840 big thank you to the US Naval Institute, 01:10.840 --> 01:15.160 AFCEA, for hosting this wonderful venue. 01:15.820 --> 01:20.350 I have a bad habit of trying to put together my own remarks. 01:20.910 --> 01:23.680 And so this weekend I was doing a little bit of research 01:23.680 --> 01:26.080 on this venue and the program, 01:26.080 --> 01:29.050 and I would just have to offer I'm a little bit jealous, 01:29.580 --> 01:33.070 you know, it looks like the subjects and the discussions 01:33.070 --> 01:34.330 are very similar to the ones 01:34.330 --> 01:36.930 that we're having in the Pentagon. 01:37.470 --> 01:40.700 The quality of the speakers, the quality of the companies 01:40.700 --> 01:42.750 that are represented here are quite high. 01:43.260 --> 01:45.570 You know, so I think in terms of investment of your time 01:45.570 --> 01:48.270 and your money, this is a very powerful forum. 01:48.270 --> 01:51.220 And then, as we all know, it's the network that you create 01:51.220 --> 01:52.140 that's so valuable. 01:52.140 --> 01:54.581 So it's a real pleasure to be here to help kick off 01:54.581 --> 01:56.040 this year's event. 01:57.314 --> 02:02.060 And then, you know, when I think of coming out here 02:02.060 --> 02:05.100 it's really a chance for me to do more 02:05.100 --> 02:07.690 than talk about the usual things, 02:07.690 --> 02:12.510 but for me and my assignment, it's to get my voice. 02:12.510 --> 02:13.790 And I think Admiral Daley was talking about 02:13.790 --> 02:17.480 the traditional role of a Deputy Secretary of Defense 02:17.480 --> 02:19.590 and, you know, I may to some extent play 02:19.590 --> 02:22.910 a non-traditional role, but the first six months 02:22.910 --> 02:24.060 have been fantastic. 02:24.060 --> 02:26.260 I started on July 19th, I've been 02:26.260 --> 02:27.880 in the building for six months. 02:28.310 --> 02:31.540 I've not spent a lot of time doing travel 02:32.140 --> 02:34.530 as the primary purpose was to make sure 02:34.530 --> 02:37.150 we could put together a national defense strategy 02:37.200 --> 02:39.620 and then a budget that was derived from that. 02:40.230 --> 02:42.740 And I'll talk a little bit about that more. 02:44.970 --> 02:46.680 Secretary Mattis, I've had six months 02:46.680 --> 02:48.650 to work with him, that's been incredible. 02:48.650 --> 02:51.400 Six months of working with the Chairman, 02:51.400 --> 02:54.160 and the Vice, and the Service Secretaries, 02:54.800 --> 02:57.980 and the Service Chiefs. 02:58.430 --> 03:01.570 You should know, it's a really strong team. 03:02.500 --> 03:06.210 The spirit, the energy, the collective will 03:06.210 --> 03:09.350 to compete and win is extraordinary. 03:09.350 --> 03:11.890 And in my career, I haven't had the chance 03:11.890 --> 03:13.320 to work on such a strong team, 03:13.320 --> 03:17.050 so I'm very encouraged just in the first six months. 03:18.160 --> 03:21.970 Now part of today's discussion or dialogue 03:21.970 --> 03:24.260 is how do we get all of you more engaged, 03:24.260 --> 03:27.680 because really that's the nature of winning. 03:28.780 --> 03:32.680 The, for those that know me, I have this expression, 03:33.400 --> 03:35.780 Powerpoint is the enemy of thought. 03:36.228 --> 03:38.090 But I've violated my own rule. 03:38.090 --> 03:41.770 So I put five together, just because sometimes 03:42.750 --> 03:44.380 reading a speech isn't that exciting 03:44.380 --> 03:46.750 for the people who've paid a lot of money to be here. 03:46.750 --> 03:50.440 And those five are really two that I think 03:50.980 --> 03:54.760 characterize I'll say context of the environment 03:54.760 --> 03:56.960 that we're working in today in the Pentagon. 03:57.470 --> 03:58.790 And a little bit of my discussion here 03:58.790 --> 04:01.570 is to give you kind of a sense of how we're thinking, 04:01.570 --> 04:04.810 what we're doing, because I know in my years in industry 04:04.810 --> 04:08.050 it was always hard, you know, what are they thinking, 04:08.050 --> 04:09.790 what do they want, what do we need to do, 04:09.790 --> 04:11.720 we all want to be successful in 04:11.720 --> 04:12.990 where we're spending our money 04:12.990 --> 04:14.580 or how we're using our time. 04:15.160 --> 04:17.850 Could you throw us a few scraps, you know. 04:17.850 --> 04:20.490 And today I hope to give you more than a few scraps, 04:21.350 --> 04:22.820 some insight into what we're doing, 04:22.820 --> 04:25.220 where we're going, and how fast we want to move. 04:25.870 --> 04:30.850 The other, maybe, message behind that is 04:31.560 --> 04:34.920 we're really as much about implementation as anything, 04:34.920 --> 04:37.840 and that when the collective we, 04:37.840 --> 04:40.610 meaning government and industry, are aligned, 04:41.200 --> 04:42.840 we have a history of dominating. 04:43.800 --> 04:47.330 So I want to do an informal poll here. 04:47.910 --> 04:49.900 This is a little audience participation. 04:49.900 --> 04:51.870 How many of you think Secretary Mattis 04:51.870 --> 04:54.000 is doing a good job, show of hands? 04:54.590 --> 04:55.940 Alright, that's good. 04:56.440 --> 04:57.273 Okay. 04:57.400 --> 04:59.790 How many of you think he could do a better job? 05:01.100 --> 05:03.770 Oh, there's one hand, there's a couple, okay, alright. 05:03.780 --> 05:05.580 Um, why don't we get together after, 05:06.160 --> 05:07.630 we could have a little discussion, 05:07.630 --> 05:09.330 I've brought some friends with me. 05:10.030 --> 05:11.710 Yeah, yeah, yeah, no. 05:12.180 --> 05:17.050 Um, I've been real fortunate to witness 05:17.730 --> 05:22.730 probably six months of, five months of his time in 2017, 05:22.770 --> 05:26.092 and I want to maybe just talk about 2017 05:26.092 --> 05:31.092 for a moment, and the performance of the Secretary 05:32.399 --> 05:33.760 and, you know, I'll say collectively 05:33.760 --> 05:35.070 the team here in DoD. 05:35.070 --> 05:38.840 So if I can go to the next slide here. 05:41.230 --> 05:44.420 You know, the short story is, 05:45.080 --> 05:47.250 besides it being a complex environment, 05:47.270 --> 05:49.070 imagine the concurrency that's going on 05:49.070 --> 05:50.570 inside the building right now. 05:51.340 --> 05:53.070 So, standing up a team, you're the Secretary 05:53.070 --> 05:54.440 standing up a whole new team, 05:54.440 --> 05:58.000 and then you have the ISIS campaign, 05:58.010 --> 06:03.010 you have the, uh, the new President Trump's 06:04.450 --> 06:09.180 new South Asia strategy to win in Afghanistan. 06:09.690 --> 06:11.570 More than any other time in history 06:11.570 --> 06:14.040 in terms of natural disasters, I think it numbers 06:14.040 --> 06:16.300 over 300 billion dollars. 06:17.110 --> 06:21.700 A North Korean situation in which 23 missiles 06:21.700 --> 06:23.380 have been launched in the last year, 06:23.380 --> 06:25.380 and 16 tests, I mean you can kind of 06:25.800 --> 06:27.310 read down the list. 06:27.620 --> 06:30.600 It's been a very, very dynamic environment. 06:31.550 --> 06:34.910 It would have been so easy to take a pass 06:35.530 --> 06:38.560 on the strategy this year, because of all the activities 06:38.560 --> 06:40.980 and all the turmoil and all the changes 06:40.980 --> 06:42.230 going on in the building. 06:42.810 --> 06:45.490 And just to throw, just to make it a little spicier 06:45.490 --> 06:49.670 and more fun in the fourth quarter of 2017, 06:50.400 --> 06:54.400 we were under a CR so we had to operate at 10% below 06:55.250 --> 06:58.530 our FY18 President's Request. 06:59.010 --> 07:02.205 So all of that was going on, and simultaneously 07:02.205 --> 07:05.350 we put together the national defense strategy. 07:06.178 --> 07:08.780 And the inside baseball part of that is 07:09.000 --> 07:12.610 it was a well-coordinated whole of government effort. 07:13.170 --> 07:14.610 You know, from the outside you often hear 07:14.610 --> 07:17.230 about the bureaucracy and the pace 07:17.230 --> 07:18.350 and some of the inefficiency 07:18.350 --> 07:20.330 of coordinating across agencies. 07:20.800 --> 07:23.100 I'm here to tell you that that did not happen. 07:23.161 --> 07:26.330 The Department was well-coordinated with 07:26.330 --> 07:27.770 the National Security Council, 07:27.770 --> 07:32.770 the national security strategy that the President drove, 07:32.780 --> 07:36.180 we were hand in glove in aligning, 07:36.270 --> 07:37.860 not just the, when you think about aligning 07:37.860 --> 07:39.500 sometimes it's making the words match, 07:39.500 --> 07:41.900 but we're talking about integrating the policies 07:41.900 --> 07:46.430 so that it's complimentary, that it really prioritizes 07:46.430 --> 07:48.730 what's required for the defense of the nation. 07:49.857 --> 07:51.490 And concurrent to that, we're working 07:51.490 --> 07:54.030 with the State Department so that the product 07:54.030 --> 07:55.890 that hopefully many of you have read by now, 07:55.890 --> 07:58.680 the unclassified version, which is 11 pages, 07:59.240 --> 08:04.240 is the result of a sprint to put together 08:04.542 --> 08:07.160 a strategy that would build a budget. 08:07.970 --> 08:10.310 And the budget, starting in about August, 08:10.310 --> 08:12.480 had to be hand massaged top down 08:12.490 --> 08:14.890 so that it was really derived from the strategy. 08:14.910 --> 08:17.640 I'm quite proud of the work that's been done, 08:17.640 --> 08:20.630 I was sharing with a few others that the Secretary 08:21.130 --> 08:26.130 has this I wanna call it intensity 08:27.760 --> 08:30.550 and he applies Jesuit-level rigor 08:31.130 --> 08:33.310 to any of the work that we take to his office. 08:33.310 --> 08:36.370 He literally reads every, every word. 08:37.897 --> 08:41.220 The national defense strategy is his strategy, 08:41.590 --> 08:44.700 the Department put it together, but it has his fingerprints 08:44.700 --> 08:47.250 and we're all behind it to bring it home. 08:47.250 --> 08:49.520 And today I really want to talk about implementation, 08:49.520 --> 08:50.870 so we go to the next slide. 08:52.330 --> 08:55.470 This is the action that's going on 08:55.470 --> 08:56.740 behind the strategy. 08:56.740 --> 09:00.690 So if we distilled the 11 pages down to one page, 09:00.690 --> 09:01.750 it would be this one. 09:01.750 --> 09:05.470 And what I'm gonna do in providing some color here 09:05.470 --> 09:08.812 is not give you a blinding flash of the obvious, 09:08.812 --> 09:10.820 but if I had a yellow highlighter, 09:10.820 --> 09:13.800 when I was highlighting certain words on the page, 09:14.870 --> 09:17.660 I would describe what those words really mean to us 09:17.660 --> 09:19.750 who are hard at work doing the implementation. 09:19.750 --> 09:23.500 So when you see the first bullet there, 09:23.500 --> 09:26.960 long-term strategic competitions with China and Russia, 09:27.487 --> 09:30.880 we circle strategic and competition. 09:32.108 --> 09:34.500 The reason we circle strategic, 09:34.500 --> 09:36.730 and this is from a leadership standpoint is, 09:37.300 --> 09:39.210 it really tasks people to do, 09:39.510 --> 09:40.960 take a hard look at their calendar. 09:40.960 --> 09:43.290 If they're spending an hour a month 09:43.290 --> 09:46.020 on strategy, they're irrelevant. 09:47.610 --> 09:50.240 Leadership's job is to cast a long shadow, 09:50.240 --> 09:54.540 and if that shadow isn't focused on the strategy 09:54.540 --> 09:57.880 that we need to go implement, we will not achieve it. 09:57.880 --> 09:59.380 The second is competition. 09:59.847 --> 10:02.247 It was fun to watch the Super Bowl this weekend. 10:02.290 --> 10:03.570 I think there's a lot we can learn 10:03.570 --> 10:08.220 from professional sports, the level of teamwork that occurs 10:08.560 --> 10:12.590 and then the level of competitiveness that occurs. 10:13.861 --> 10:17.710 We all hear about how our competitiveness has eroded, 10:18.583 --> 10:21.750 our strategy is about how we sharpen and strengthen 10:21.750 --> 10:22.650 our competitiveness. 10:22.650 --> 10:25.020 And what I would ask everyone here in the room 10:25.020 --> 10:29.930 to think about is, you know, when you look at some place 10:29.930 --> 10:33.440 like the NFL it used to be defenses won, 10:33.440 --> 10:36.780 now it's offenses, has been a big shift. 10:36.780 --> 10:39.170 But that Doug Peterson, nine years ago, 10:39.170 --> 10:41.770 was teaching, high school football, 10:41.770 --> 10:43.430 or coaching high school football. 10:44.060 --> 10:46.210 And I think that's how we have to approach, 10:46.570 --> 10:47.403 you know, our future. 10:47.403 --> 10:51.620 How do we compete stronger and more effectively. 10:51.620 --> 10:54.140 It's not about China, it's not about Russia, 10:54.460 --> 10:57.110 it's about competing, and there are no such things 10:57.110 --> 10:58.550 as fair competitions. 10:58.910 --> 11:00.240 There's just competition. 11:01.280 --> 11:05.060 The second bullet is about combat credible forward presence 11:05.060 --> 11:06.410 in Asia and Europe. 11:06.790 --> 11:09.650 And I would just highlight combat credible. 11:11.450 --> 11:14.880 And the real message to take from that is 11:16.330 --> 11:19.680 let's not just acknowledge that we will operate 11:19.680 --> 11:23.480 in a contested environment, let's embrace the fact 11:23.480 --> 11:26.280 that we'll operate in a contested environment. 11:26.720 --> 11:30.940 And that we understand how we can leverage 11:30.940 --> 11:34.230 capability, capacity, and geography 11:34.230 --> 11:36.630 not to just get an additive effect 11:36.630 --> 11:38.220 or a multiplicative effect, 11:38.480 --> 11:40.850 but how do we get an exponential effect 11:41.390 --> 11:42.590 from the combination. 11:44.010 --> 11:47.610 Sustainable missions in the Middle East and Central Asia, 11:48.850 --> 11:53.602 read supercharged policy and broadening and deepening 11:53.602 --> 11:55.550 our coalition partnerships. 11:57.380 --> 12:00.430 The most interesting, I don't know 12:00.570 --> 12:03.530 how all of you have read the document or the work, 12:03.530 --> 12:07.070 but to me the biggest change in 12:07.070 --> 12:08.490 the national defense strategy 12:08.490 --> 12:10.440 is hidden in these words called 12:10.440 --> 12:13.610 dynamic force posture and deployment. 12:14.370 --> 12:18.620 And it's really about how we'll be faster, 12:20.160 --> 12:24.400 and how we'll make decisions about distributing resources 12:24.630 --> 12:26.300 differently than we do today. 12:26.310 --> 12:27.510 More about that later. 12:28.780 --> 12:30.780 The last two bullets really go together, 12:31.300 --> 12:34.500 and, you know, being a good engineer 12:34.500 --> 12:36.850 everything that engineers do is all about numbers 12:36.850 --> 12:40.360 so that's why Admiral Daley I probably won't do well 12:40.360 --> 12:44.670 in that policy role, but in terms of objectivity, 12:45.870 --> 12:49.890 our focus really is around defining in the, 12:50.509 --> 12:52.290 I think the industry partners here understand this, 12:52.290 --> 12:54.200 but how do we put definition to 12:54.360 --> 12:56.850 lethality, resilience, and agility 12:56.850 --> 12:59.640 beyond, you know, finding ways to put them 12:59.640 --> 13:00.980 on the Powerpoint charts. 13:01.650 --> 13:04.180 They have criteria, and the reason 13:04.180 --> 13:06.430 I said the last two bullets go together is 13:07.440 --> 13:12.090 development, modernization, providing new capability 13:12.090 --> 13:14.070 is not the enemy of cost. 13:14.880 --> 13:19.300 We must make our systems and products affordable. 13:19.853 --> 13:24.520 And I've lived in a world both commercial and defense, 13:25.100 --> 13:29.720 and in the commercial world cost is much more dominant 13:30.390 --> 13:33.800 in decision-making and in the design criteria, 13:33.800 --> 13:37.350 and I would just offer that our biggest opportunity 13:38.200 --> 13:43.200 is to be smarter and faster when it comes to 13:43.540 --> 13:46.440 the development of these programs and their affordability. 13:46.580 --> 13:49.250 So that's the NDS on one page, next slide. 13:52.910 --> 13:54.510 How's that look, baseball? 13:55.210 --> 13:56.043 Good? 13:56.370 --> 13:59.760 You guys aren't, this is like the best conference 13:59.760 --> 14:02.780 of the year, and you're just, you're flat on me. 14:04.360 --> 14:06.760 I put, I worked hard on that baseball picture 14:06.760 --> 14:08.510 even though I mean, I'm from Seattle 14:08.510 --> 14:10.210 and we don't have a baseball team. 14:10.520 --> 14:12.490 But uh, alright, there we go. 14:12.490 --> 14:13.980 Okay, alright. 14:14.060 --> 14:15.920 So I call this slide the DoD slide, 14:15.920 --> 14:18.910 and the DoD slide is if you were to come to the Pentagon 14:19.310 --> 14:22.510 and follow a few of us around, and we were gonna 14:22.520 --> 14:25.480 have a conversation of what the next six months looks like 14:25.940 --> 14:29.400 with regards to the national defense strategy, 14:29.620 --> 14:34.340 these are the three big levers you would find me pulling on 14:34.800 --> 14:35.870 and the leadership. 14:36.660 --> 14:40.350 So the first one says strategy to action. 14:41.010 --> 14:42.740 Active leadership. 14:43.910 --> 14:46.130 My uh, grew up with two brothers. 14:46.130 --> 14:49.420 My youngest brother had a small business, 14:49.500 --> 14:51.650 and he always used to have this expression, 14:53.090 --> 14:56.120 you know, to make money you have to work on the business 14:56.120 --> 14:57.390 and not in the business. 14:57.390 --> 15:00.300 I think, you know, this is back to the conversation 15:00.360 --> 15:02.670 about where we're spending our time. 15:03.310 --> 15:05.600 We in the building will be spending our time 15:05.600 --> 15:09.640 on the business, not in the business, you know, 15:09.640 --> 15:13.370 working on the tactical side of the Pentagon, 15:13.370 --> 15:14.820 of the Department of Defense. 15:15.610 --> 15:17.369 The one I'm most excited about 15:17.369 --> 15:20.370 is how we're going to implement change of scale, 15:20.370 --> 15:22.080 you know, we can run all sorts of little pilots, 15:22.080 --> 15:25.420 experiments, you know, demonstrate with, you know, 15:25.920 --> 15:29.250 100 people, 200 people, thousand people 15:29.250 --> 15:32.360 that certain concepts work, but this is really about 15:32.830 --> 15:36.240 how do we affect change for millions 15:36.240 --> 15:37.480 and make it enduring? 15:38.301 --> 15:43.301 Put the comment breaking the Gordian knot. 15:43.610 --> 15:45.920 That's how I view the Pentagon, 15:45.920 --> 15:50.000 is that it's a beautiful machine 15:50.460 --> 15:51.560 if you know how to make it work. 15:51.560 --> 15:52.850 And if you don't know how to make it work 15:52.850 --> 15:56.130 it's a very complicated, bureaucratic space. 15:57.090 --> 15:58.870 I think you, many of you know, 15:58.870 --> 16:00.140 the legend of the Gordian knot, 16:00.140 --> 16:01.840 where Alexander the Great, 16:02.150 --> 16:03.700 I'm not Alexander the Great, I think maybe 16:03.700 --> 16:06.940 Secretary Mattis is, but I think the metaphor 16:06.940 --> 16:08.050 applies to the Pentagon. 16:08.050 --> 16:09.500 If we want to solve problems there, 16:09.500 --> 16:11.040 we need to break it into certain pieces 16:11.040 --> 16:12.490 that make it more manageable. 16:12.860 --> 16:15.960 And the three biggest pieces that we'll be working on, 16:15.970 --> 16:19.680 and I should probably preface these remarks by 16:20.550 --> 16:23.800 tomorrow morning about 9:00 Eastern Standard Time 16:23.800 --> 16:25.830 I'll be sitting with the Chairman and the Secretary 16:25.830 --> 16:28.290 and we'll be signing off the implementation guidance 16:28.290 --> 16:29.890 that goes along with doing this. 16:30.450 --> 16:33.050 So from, you know, an industry standpoint 16:33.050 --> 16:34.050 where you put this together, 16:34.050 --> 16:35.680 put together schedules of processes, 16:35.680 --> 16:36.720 we did the strategy on time, 16:36.720 --> 16:38.780 we did the develop the budget on time, 16:38.780 --> 16:40.160 we're gonna deliver the budget on time, 16:40.160 --> 16:41.740 we're gonna have implementation guidance, 16:41.740 --> 16:44.330 defense planning guidance, financial guidance, 16:44.970 --> 16:48.540 to go do these things, so it's not just talk. 16:49.230 --> 16:53.290 But the pieces that we're subdividing 16:53.660 --> 16:56.310 the Pentagon or the Department of Defense into 16:56.680 --> 16:59.270 really center on how do we be more joint, 16:59.270 --> 17:02.470 and the joint piece of this is again, 17:02.720 --> 17:06.610 leveraging the joint staff, the speed element, 17:06.610 --> 17:08.840 and the little, my fancy graphic 17:08.840 --> 17:11.410 that I spent all of ten minutes putting together 17:11.460 --> 17:13.400 as a little calendar going to a clock. 17:14.810 --> 17:18.140 For certain processes that relate 17:18.420 --> 17:21.794 to the deployment of resources, we're gonna go from 17:21.794 --> 17:25.680 a month's scale to a less than 24 hour scale. 17:27.040 --> 17:30.550 We're also, you know, and I'm hoping 17:30.890 --> 17:33.990 this really is one of the bigger outputs is that 17:34.460 --> 17:38.360 prioritization of force development and force design 17:38.360 --> 17:40.960 is really going to be driven through the joint staff 17:41.110 --> 17:42.010 more so this year. 17:42.010 --> 17:46.460 So from where all of you sit, that prioritization 17:46.460 --> 17:48.840 both on what we're going to do to achieve 17:48.840 --> 17:51.210 the national defense strategy is very important, 17:51.210 --> 17:53.850 but also there's a forced march on 17:53.850 --> 17:55.070 what are we not going to do 17:55.070 --> 17:58.660 which is always, you know, the elephant in the room. 17:58.660 --> 18:01.240 But that's the discipline and the commitment 18:01.240 --> 18:02.700 we're focused on. 18:03.830 --> 18:07.420 The vertical relates to the services. 18:08.210 --> 18:10.760 I put the baseball example in place 18:10.760 --> 18:12.600 because it's always hard to describe this, 18:12.600 --> 18:15.680 but when you think about product development 18:15.680 --> 18:19.240 and player development in baseball, 18:19.240 --> 18:20.290 they're very similar. 18:20.310 --> 18:21.720 And I would argue, so you know, 18:21.720 --> 18:23.230 you think about player development. 18:23.230 --> 18:27.190 You find a kid in high school, this would be our case. 18:27.190 --> 18:31.690 We'd find someone who's 6 foot 9, can throw a curve ball 18:31.690 --> 18:34.540 with his left hand and his right hand, 100 miles an hour, 18:35.210 --> 18:39.320 and in our system, they would get to the big leagues 18:39.320 --> 18:40.620 when they were 30 or 40. 18:41.840 --> 18:43.250 So the issue isn't talent, 18:43.250 --> 18:45.640 it's development and the speed. 18:46.090 --> 18:50.820 So our focus with the services is really not 18:51.080 --> 18:53.020 do we not have the talent, money, 18:53.470 --> 18:55.020 it's we don't have the speed 18:55.760 --> 18:58.820 to do what you want us to do is 18:58.820 --> 19:01.380 integrate your products and services 19:01.980 --> 19:05.430 so we have a balanced portfolio from S&T 19:05.430 --> 19:08.210 all the way 'til when we take programs out 19:08.210 --> 19:09.950 and retire 'em and put 'em in museums. 19:09.950 --> 19:14.260 We are out of balance, and we're also too slow. 19:14.260 --> 19:17.650 So if you said, "Pat, where are you gonna spend 19:17.650 --> 19:18.930 "a good majority of your time?" 19:18.930 --> 19:21.730 I'll get to the details of that later. 19:22.170 --> 19:24.410 Getting the reforms going but hopefully, 19:24.410 --> 19:27.500 my biggest contribution will be no different 19:27.500 --> 19:30.720 than what all of us have done in our careers, 19:30.780 --> 19:35.780 how do we go faster with making programs more executable, 19:36.130 --> 19:39.900 get to market faster, get better cost structures, 19:39.900 --> 19:40.940 and are sustainable. 19:41.840 --> 19:45.020 Third piece really has to do with how do we scale 19:45.340 --> 19:46.370 new technology. 19:46.370 --> 19:49.590 We don't have a problem understanding 19:49.590 --> 19:52.490 the potential of innovation, we have a problem scaling it. 19:52.876 --> 19:54.190 And so this is really, in a number 19:54.190 --> 19:56.990 of really critical areas how we're gonna concentrate 19:57.280 --> 19:58.700 and scale technology. 19:59.680 --> 20:04.650 The third bullet is, I think, the important piece, 20:04.650 --> 20:09.650 and that is if everything is a change through a policy memo, 20:10.160 --> 20:12.810 or, you know, some paper document, 20:13.120 --> 20:15.820 the next person in the job gets to undo that. 20:16.680 --> 20:19.010 So everything that we're trying to do 20:19.010 --> 20:21.550 is make it so you can't go backwards. 20:22.430 --> 20:25.340 And so the piece you see there, 20:26.280 --> 20:29.080 restructure, it's this emphasis on changing the structure. 20:29.080 --> 20:33.340 If we don't change, if there aren't enduring changes, 20:33.340 --> 20:34.432 none of this will stick. 20:34.432 --> 20:38.300 And I look at it in three areas, 20:40.140 --> 20:41.830 reorganization and integration. 20:42.280 --> 20:44.330 Reorganizing is the easiest thing to do 20:44.360 --> 20:45.330 and the hardest to implement. 20:45.330 --> 20:49.090 So if you ask me on the top of my, you know, list, 20:49.390 --> 20:50.223 whoops. 20:50.223 --> 20:52.900 We got, we must have a virus here. 20:53.530 --> 20:54.440 There we go, alright. 20:54.440 --> 20:55.380 You guys, okay? 20:55.380 --> 20:56.213 We got this. 20:58.610 --> 21:01.840 But if you ask me the easiest tool people run to 21:01.840 --> 21:04.190 is to reorganize, but it's really more about 21:04.190 --> 21:05.750 how do we re-engineer? 21:06.270 --> 21:08.670 How do we change the work itself 21:09.250 --> 21:11.320 and get more effectiveness? 21:11.320 --> 21:12.900 They have a term in the Pentagon, 21:12.900 --> 21:14.400 never heard this before, salami slicing, 21:14.400 --> 21:15.640 but I think all of you know what that is. 21:15.640 --> 21:18.910 It's really about we achieve efficiency by removing people. 21:18.950 --> 21:22.490 So, you know, it's a way to ensure 21:22.490 --> 21:25.330 increasing the risk, stressing people out, 21:25.330 --> 21:27.720 and keeping a lot of the old processes the same 21:27.720 --> 21:30.220 so this is really more about 21:30.490 --> 21:31.380 what are we gonna re-engineer. 21:31.380 --> 21:36.370 So the types of things, uh, intelligence, finance. 21:36.370 --> 21:40.220 There's a whole host of these that we've already initiated 21:40.220 --> 21:43.070 hard work on, and then the last part is, you know, 21:43.070 --> 21:45.550 technology is really the glue 21:45.550 --> 21:48.930 once you've done the good re-engineering 21:48.930 --> 21:50.310 that makes it stick and allows you 21:50.310 --> 21:51.840 to unlock more and more productivity. 21:51.840 --> 21:53.340 They have a tremendous amount 21:53.700 --> 21:54.533 there at the Pentagon. 21:54.533 --> 21:56.680 And that's the two plus two equals seven. 21:56.680 --> 22:01.680 It's a tremendous place, the workforce is remarkable. 22:03.560 --> 22:07.670 I have, transitioning in from industry, 22:07.670 --> 22:10.460 you don't know, you know, exactly how receptive 22:10.460 --> 22:11.870 people will be to change. 22:12.267 --> 22:17.267 They desire, there's a desire for leadership and direction 22:17.900 --> 22:19.110 and once that direction is given, 22:19.110 --> 22:23.450 that's why the emphasis is so great on top-down leadership. 22:23.640 --> 22:26.070 The teams, they take orders and they march. 22:26.770 --> 22:28.370 So we go to the next slide here. 22:29.160 --> 22:31.620 I thought I'd make a few comments on leadership. 22:32.731 --> 22:36.070 And this is where our heads are today. 22:37.150 --> 22:40.870 The first one, today's skills, you know, 22:40.870 --> 22:44.330 when I think back of when I came out of college 22:45.150 --> 22:47.450 and all the things I learned, and I worked hard, 22:47.450 --> 22:51.990 in my first 10, 20 years at the Boeing Company to hone, 22:52.230 --> 22:55.130 many of those skills aren't needed today to be successful. 22:55.840 --> 22:59.130 And so you get to a certain position, and now, 22:59.700 --> 23:01.820 you can either be a blocker or an enabler. 23:02.500 --> 23:04.550 And the mental model I have, 23:04.550 --> 23:07.880 and it's the one we've been helping the leadership 23:07.880 --> 23:08.820 to kind of think through. 23:08.820 --> 23:10.570 Remember this company called Kodak? 23:11.850 --> 23:15.010 Kodak was a company that was over 100 years old, 23:15.960 --> 23:19.380 they had 70 percent of the market share for film. 23:20.670 --> 23:22.520 And they invented the digital camera, 23:23.380 --> 23:24.480 no they went bankrupt. 23:25.520 --> 23:28.650 The leadership could not move from film 23:29.150 --> 23:30.150 to the digital camera. 23:30.150 --> 23:32.560 The innovation, the change, was too great. 23:32.560 --> 23:35.070 Now they had the people, but the leadership 23:35.070 --> 23:36.960 didn't know how to make that switch. 23:37.313 --> 23:41.480 We're blessed, when you look at the E1s to O3s 23:41.740 --> 23:45.340 in terms of the talent, the motivation, 23:45.340 --> 23:49.060 the professionalism, our responsibility 23:49.060 --> 23:51.780 is to turn over to them an environment 23:51.780 --> 23:53.190 where they can flourish, 23:54.240 --> 23:57.050 and when you ask people about innovation 23:57.050 --> 23:58.640 everybody says "Oh I want that. 23:58.940 --> 24:00.020 "Want more of it. 24:00.180 --> 24:01.013 "We need it." 24:01.013 --> 24:02.670 But when you actually are innovating, 24:02.670 --> 24:06.390 and those of you in industry know this, 24:07.150 --> 24:11.720 innovation is messy, and for those that have 24:11.720 --> 24:15.430 tight financial controls, no one likes things 24:15.520 --> 24:16.440 that are untidy. 24:17.240 --> 24:21.470 And so I think if we really want to make that transition 24:21.470 --> 24:24.540 to be more competitive in a contested environment 24:24.540 --> 24:28.960 and integrate novel, new technologies that scale, 24:29.470 --> 24:30.800 we're gonna have to get comfortable 24:30.800 --> 24:31.870 with people making mistakes. 24:31.870 --> 24:35.150 I think we all believe that, it's amazing 24:35.150 --> 24:39.850 to watch how the organization looks to the leadership 24:40.110 --> 24:41.830 when that first person makes a mistake. 24:41.830 --> 24:44.370 So if we all run down and embrace 'em, pick 'em up, 24:44.370 --> 24:45.870 help 'em fall forward again, 24:46.300 --> 24:47.900 the organization gets turned on. 24:48.060 --> 24:50.110 If you don't, then everybody runs into the shadows 24:50.110 --> 24:52.810 and that's the end of innovation. 24:54.190 --> 24:56.050 The third bullet's kind of a fun one, 24:56.803 --> 24:58.850 because you have the bottom of the page there, 24:58.850 --> 25:03.850 there's this lady, Vice Admiral Bono, 25:04.140 --> 25:06.390 she's the Director of the Defense Health Agency 25:06.390 --> 25:08.790 smiling there, 'cause she loves her job so much. 25:09.460 --> 25:13.410 She uh, this is, when people ask me 25:13.410 --> 25:16.210 "Well, what are some of your perceptions 25:16.600 --> 25:21.370 "being in the Department in your first few months?" 25:21.370 --> 25:23.610 One of 'em is that we're risk imbalanced. 25:23.610 --> 25:25.620 And I'll used Admiral Bono as an example, 25:25.620 --> 25:29.160 because we have so much opportunity 25:29.160 --> 25:31.860 when it comes to taking cost out of, 25:32.030 --> 25:33.270 I'll call it the back office, 25:33.270 --> 25:35.860 but health care is not the back office, 25:35.860 --> 25:38.730 but it's non-military operations. 25:40.130 --> 25:42.790 And my comment about being risk-imbalanced is 25:42.790 --> 25:46.310 every morning I get very detailed intelligence reports. 25:47.328 --> 25:51.840 And I see the risk our teams take down range, 25:51.840 --> 25:52.980 it is extraordinary. 25:54.410 --> 25:57.160 And then I look at the work we're trying to do 25:57.160 --> 25:59.040 on reforms, or take cost out, 25:59.040 --> 26:02.610 or change, you know, very straightforward things. 26:03.300 --> 26:05.830 Make changes that all of you in industry 26:05.830 --> 26:07.190 did 10 years ago. 26:07.989 --> 26:10.889 And the culture is, "No, we don't want to take that risk." 26:11.560 --> 26:15.140 So we're more willing to take risk downrange, 26:15.140 --> 26:16.790 but not in these areas. 26:17.210 --> 26:22.210 Admiral Bono has the potential to integrate 390 clinics. 26:23.090 --> 26:26.130 All that money goes to, you know, in terms of, 26:26.620 --> 26:29.540 imagine if we integrated all of those quality of care, 26:29.640 --> 26:31.550 the delivery of care improves, 26:31.550 --> 26:33.760 and we all know from some of those standards 26:33.760 --> 26:36.980 cost goes down, but our foot's on the brake. 26:37.040 --> 26:39.120 We want her to prove it to us. 26:39.720 --> 26:41.250 So, you know, again, I would, 26:41.870 --> 26:44.780 we have a lot of different leaders in this room, 26:46.060 --> 26:48.980 encourage the team to take the right kind of risk 26:48.980 --> 26:51.230 and we can take more risk in the back office. 26:52.710 --> 26:54.690 By, with, and through, for those of you that did 26:54.690 --> 26:56.230 read the national defense strategy, 26:56.230 --> 27:00.130 a big emphasis is on how do we grow our relationships, 27:00.700 --> 27:02.700 especially with our partners and allies. 27:03.360 --> 27:05.960 Every one of us is in the relationship business, 27:06.582 --> 27:11.582 the lesson I learned in this area a long time ago 27:12.400 --> 27:15.260 was really the part about everybody, 27:15.260 --> 27:16.800 it's not just business development, 27:16.800 --> 27:18.550 it's not just the State Department. 27:19.670 --> 27:22.120 So in this small airplane company 27:22.120 --> 27:24.990 I worked for up north, we would deliver airplanes 27:24.990 --> 27:27.010 all the time, and customers would come in 27:27.010 --> 27:28.500 to pick up these airplanes. 27:29.550 --> 27:31.860 You know who some of the best salespeople were? 27:32.440 --> 27:34.170 The Teamsters that would drive 27:34.440 --> 27:36.840 the customers around to pick up their airplanes. 27:36.960 --> 27:39.730 Those Teamsters were such advocates, 27:39.730 --> 27:43.600 and every touch they were working to sell an airplane 27:44.080 --> 27:46.950 or some kind of, you know, address a concern 27:46.950 --> 27:48.280 or an interest of a customer. 27:48.280 --> 27:50.730 All of us need to take that to heart. 27:52.000 --> 27:53.660 That last one is really more, 27:53.750 --> 27:55.710 I'll put it in the hygiene category. 27:56.460 --> 27:59.900 I'm guilty, I used to wear a FitBit up until this last week. 28:00.404 --> 28:01.520 (audience laughter) 28:01.520 --> 28:03.850 But in the NDS it talks about 28:03.850 --> 28:05.330 being strategically predictable 28:05.330 --> 28:07.060 but operationally unpredictable. 28:07.940 --> 28:10.390 We leave digital footprints all over the place, 28:10.590 --> 28:13.500 I think our men and women with their cell phones, 28:13.500 --> 28:15.340 I'm guilty myself, I mean. 28:15.680 --> 28:18.260 We just, as we start to think about, you know, 28:18.260 --> 28:20.530 being operationally unpredictable, 28:20.530 --> 28:23.570 we paid to put into place all these other safeguards 28:23.570 --> 28:27.206 and capabilities, and not have the common sense 28:27.206 --> 28:29.520 to keep from exposing ourselves. 28:30.618 --> 28:31.910 Next slide please. 28:33.160 --> 28:37.040 Now here's the best ones, they're just some thoughts on 28:37.817 --> 28:39.530 our industry partners. 28:39.940 --> 28:43.380 The first one, and this is really meant 28:44.560 --> 28:47.560 to ask you for some help, it's also 28:48.220 --> 28:51.340 part of the message I've been working in the department. 28:52.720 --> 28:57.660 The vulnerability of cyber, I think we all understand this, 28:57.760 --> 28:58.900 is significant. 28:59.840 --> 29:04.840 You can imagine if tomorrow, I signed out a new memo, 29:05.800 --> 29:09.070 you know, Mike Pedders, from the Department of Defense, 29:09.360 --> 29:12.060 we, instead of having a financial disclosure statement 29:12.110 --> 29:14.510 we want you to sign a cyber disclosure statement 29:14.510 --> 29:18.850 that says everybody you do business with is secure. 29:19.700 --> 29:22.870 I mean, I don't think you'd sign that tomorrow, 29:23.050 --> 29:25.980 but I mean, we need to get to that level 29:26.480 --> 29:31.480 because your secrets, our secrets, are exposed. 29:32.090 --> 29:34.120 And the culture we need to get to 29:34.120 --> 29:36.200 is that we're gonna defend ourselves 29:36.488 --> 29:41.400 and that just like with security clearances, 29:41.400 --> 29:42.970 or any time information is compromised, 29:42.970 --> 29:44.650 we want the bar to be so high 29:45.110 --> 29:47.410 that it becomes a condition of doing business. 29:49.000 --> 29:52.630 We won't drop that safe on anyone's head right away, 29:52.630 --> 29:54.610 but that's where we want to get to, okay? 29:54.610 --> 29:56.300 It's too important. 29:58.210 --> 30:02.640 Second one is in the national defense strategy 30:02.640 --> 30:07.020 is this emphasis on foreign military sales. 30:07.790 --> 30:09.590 Department of Defense is open for business, 30:09.590 --> 30:11.980 I'm responsible for foreign military sales. 30:12.720 --> 30:16.080 We will be your advocate, I recognize 30:16.160 --> 30:18.920 there are a number of problems and issues 30:18.920 --> 30:20.420 and I'm responsible for those. 30:20.660 --> 30:22.870 And we will work to improve those. 30:23.579 --> 30:26.920 The place you can help all of us is, 30:26.920 --> 30:28.810 especially to the industry groups, 30:30.540 --> 30:32.666 stay honest but help prioritize 30:32.666 --> 30:35.740 the changes we need to make. 30:35.740 --> 30:39.040 When I have put my fingers into a lot of this 30:39.040 --> 30:41.570 it's, you know, a thousand different items 30:42.340 --> 30:46.200 and we can make, we can make substantial change 30:46.270 --> 30:49.340 but helping us distill it into the critical ones 30:49.820 --> 30:50.900 has a lot of value. 30:51.530 --> 30:53.380 I won't belabor the affordability point, 30:53.380 --> 30:55.240 I think we all have an affordability problem, 30:55.240 --> 31:00.240 I think we long-term have to reduce the cost of defense. 31:02.120 --> 31:04.400 It takes time, but we're gonna run out of time 31:04.400 --> 31:06.010 and that's the part I worry about, 31:06.010 --> 31:08.830 because then we'll have to make really serious trades 31:09.050 --> 31:12.450 and get into this readiness versus modernization. 31:12.850 --> 31:15.190 We've got a window here where we can do both, 31:15.710 --> 31:18.970 and it starts with having the mindset 31:19.140 --> 31:21.380 that we have to be more affordable. 31:22.020 --> 31:23.650 And maybe to put into context, 31:23.650 --> 31:24.900 when we think about affordability, 31:24.900 --> 31:28.340 I always think about affordability in terms of, 31:29.640 --> 31:32.070 this is back to the NFL, 40 yard dash. 31:32.170 --> 31:34.370 So when somebody says, "Hey, I'm affordable. 31:35.000 --> 31:38.520 "Look, I'm 10%, you know, lower cost 31:38.520 --> 31:39.520 "than I was before." 31:39.520 --> 31:43.700 It's more, to me, how fast do you run a 40 yard dash. 31:44.280 --> 31:46.470 If you're saying that you run it in six seconds, 31:46.470 --> 31:49.370 you know, wide receiver, then you're just not competitive. 31:49.395 --> 31:51.450 So when it comes to affordability, 31:51.450 --> 31:56.450 we really have to develop an understanding of what good is. 31:58.150 --> 32:00.720 My experience has always been what should things cost, 32:00.720 --> 32:03.120 but there are a lot of different ways to go about this 32:03.120 --> 32:06.760 but we have to get past everything is measured 32:06.760 --> 32:07.860 in terms of improvement. 32:07.860 --> 32:09.610 We have to get to an absolute scale, 32:09.610 --> 32:12.210 this is what it should cost and here's where we are. 32:13.650 --> 32:16.250 I spoke a little bit before about performance, 32:16.250 --> 32:18.850 how do we really take this and make it quantitative. 32:19.430 --> 32:21.730 You know, it's still too qualitative, 32:21.730 --> 32:24.680 and I think, especially for the smaller companies, 32:24.680 --> 32:26.800 you lose on the margins, because qualitatively 32:26.800 --> 32:29.010 we can't evaluate, I mean quantitatively 32:29.010 --> 32:30.940 we can't evaluate some of these effects 32:30.940 --> 32:32.730 and that's just where we need more 32:32.820 --> 32:33.990 discipline and rigor. 32:34.836 --> 32:39.680 The, not telling anyone anything new here, 32:39.680 --> 32:43.200 the military side of the industry is very slow 32:43.750 --> 32:46.580 and that's why big emphasis for us is speed. 32:47.120 --> 32:49.060 And then I'm just gonna plant this seed 32:49.060 --> 32:51.110 so we can get into some Q and A. 32:51.470 --> 32:53.770 The Department shouldn't be setting standards, 32:54.710 --> 32:56.700 industry should be setting standards. 32:57.350 --> 33:00.780 And, you know, by that I mean 33:01.690 --> 33:02.820 you really need to come together, 33:02.820 --> 33:04.010 if I'm going to set standards, 33:04.010 --> 33:05.680 and if things or requirements are gonna come out 33:05.680 --> 33:07.600 of JROCKS, I think we're gonna lag. 33:07.754 --> 33:10.580 You're on the front end and you spend more time 33:10.920 --> 33:13.710 thinking about how technology's gonna evolve. 33:13.790 --> 33:17.070 Our ability to have standards means we can integrate faster, 33:17.070 --> 33:19.930 we can have better means of testing, 33:20.210 --> 33:23.280 and we can, you know, iterate, in terms of integrating 33:23.280 --> 33:24.740 capability more quickly. 33:25.940 --> 33:28.100 So with that I will stop, 33:28.100 --> 33:30.930 I think we're gonna do a few questions, 33:30.930 --> 33:33.760 but maybe just in closing, 33:33.910 --> 33:38.280 very confident and excited about the implementation 33:38.280 --> 33:39.930 of the national defense strategy, 33:40.250 --> 33:42.020 we have a fantastic team. 33:42.020 --> 33:44.550 I want to thank everybody for the work they do, 33:44.550 --> 33:48.840 and look forward to interacting with all of you 33:48.840 --> 33:49.950 when we're back in Washington, D.C. 33:49.950 --> 33:51.100 So thank you very much. 33:51.327 --> 33:54.327 (audience applause) 33:57.640 --> 33:58.700 - Sir, thank you. 33:59.170 --> 34:01.860 I was going to ask you about your role 34:01.860 --> 34:03.105 and how you see your role 34:03.105 --> 34:05.480 as the Dep Sec Def, but I think you told us. 34:05.480 --> 34:09.010 You're gonna be less of the traditional Dep Sec Def 34:09.010 --> 34:12.650 and more of the reform and implementation first. 34:13.320 --> 34:16.740 - Yeah, let me make just a couple of comments there. 34:17.520 --> 34:19.260 So imagine if we drew a Venn diagram 34:19.260 --> 34:22.980 of Secretary Mattis, you know, his like, 34:22.980 --> 34:25.960 skills and background and history. 34:25.960 --> 34:28.280 And then just overlaid mine with his. 34:28.940 --> 34:32.070 At the very edge, they would touch. 34:32.830 --> 34:35.330 And it's because we're both from Washington State. 34:38.980 --> 34:41.360 So the job interview I had with him, 34:42.510 --> 34:44.440 you know there were a number of things that occurred there. 34:44.440 --> 34:48.820 But he said he wanted me to be the down and in person, 34:49.230 --> 34:50.270 and he's the up and out. 34:50.270 --> 34:54.590 So he does the White House, military operations, 34:54.860 --> 34:56.490 and, you know, all of the interaction 34:56.490 --> 34:58.580 with the allies and partners. 34:59.130 --> 35:04.130 He's really tasked me with two major undertakings, 35:05.240 --> 35:06.630 the biggest one is modernization. 35:06.630 --> 35:11.250 So my, most of my time and thinking 35:11.250 --> 35:15.160 goes into, well, it's really about lethality. 35:15.160 --> 35:17.730 How do we get the readiness and the modernization 35:17.730 --> 35:18.730 done concurrently. 35:19.220 --> 35:22.930 The reforms are a side job, but it's not a side job 35:22.930 --> 35:24.280 in terms of lower priority. 35:25.620 --> 35:27.900 Square in, I feel, in my wheelhouse, 35:27.900 --> 35:30.130 so we'll get that up and running hard. 35:30.130 --> 35:35.130 The biggest opportunity for us is to modernize, 35:35.410 --> 35:38.190 and to do it in such a way that, you know, 35:38.190 --> 35:41.210 we avoid many of the missteps of the past. 35:41.550 --> 35:44.090 - And sir, a big aspect of modernizing, 35:44.090 --> 35:46.610 and you've already touched on this in your remarks, 35:46.610 --> 35:49.420 is the speed with which we act. 35:49.540 --> 35:51.610 And you mentioned the implementation guidance 35:51.610 --> 35:54.761 and going from a scale on resource decisions 35:54.761 --> 35:58.330 from 30 days is now 24 hours, 35:58.330 --> 36:01.291 and you mentioned a bigger role for the joint staff, 36:01.291 --> 36:04.750 does that include all the aspects 36:04.750 --> 36:09.390 from identification of a requirement, R&D, 36:09.440 --> 36:12.950 acquisition, to the end state 36:12.950 --> 36:15.560 of buying a major piece of equipment? 36:15.560 --> 36:17.840 Do you see it all wrapped together, 36:17.840 --> 36:19.230 or how would that work? 36:19.557 --> 36:22.080 - So the reference in time is to 36:22.080 --> 36:24.330 decisions on deploying forces. 36:24.330 --> 36:25.163 - Okay. 36:25.163 --> 36:27.680 - And so, today it takes a certain amount of time, 36:27.680 --> 36:30.080 and we expect to do it in less than eight hours. 36:30.890 --> 36:33.040 And this isn't a study that we're gonna do, 36:33.160 --> 36:35.370 you know, for many years, these are, you know, 36:35.370 --> 36:37.800 I sat down with the Chairman, we're talking about 36:37.800 --> 36:39.040 months not years. 36:39.470 --> 36:40.303 - Got it. 36:40.303 --> 36:45.147 - The part in terms of JROCKS and decision making, 36:47.870 --> 36:50.410 I'm pretty excited about this, I had this, 36:51.143 --> 36:52.950 I've got a lot of new best friends, 36:52.950 --> 36:55.220 but probably my new best friends 36:55.520 --> 36:58.930 is the Vice Chair, General Selva. 36:59.610 --> 37:02.720 And the partnership there really is around 37:03.130 --> 37:05.790 in terms of force design and force development, 37:05.970 --> 37:08.260 what is the priorities of those capabilities 37:08.600 --> 37:10.720 so that we get those joint affects. 37:11.110 --> 37:12.960 That doesn't mean we're divorced from 37:13.140 --> 37:15.840 how each of the services need to evolve their capability, 37:15.840 --> 37:18.670 but it really drives kind of the prioritization, 37:18.670 --> 37:21.940 which in this traditional role 37:21.940 --> 37:26.320 of leading the budget development, that's a chance 37:26.320 --> 37:27.910 where I can put my thumb on the scale 37:27.910 --> 37:30.470 and that's the bonding we do 37:30.470 --> 37:32.930 and that's part of the reason we've pushed 37:32.930 --> 37:35.260 to get the implementation guidance out early 37:35.260 --> 37:38.240 is that we'll do some heavy lifting 37:38.278 --> 37:41.790 in the POM 20, so very early on, 37:41.790 --> 37:44.330 we're not just gonna let the process run itself, 37:44.330 --> 37:46.820 it's in very critical areas. 37:47.190 --> 37:50.930 How do we, in our deputies' meeting, 37:52.130 --> 37:53.330 create a lot of tension? 37:53.360 --> 37:54.310 We like tension. 37:55.050 --> 37:56.500 And so that's really where, 37:56.500 --> 38:00.030 the tension is what's been very enjoyable 38:00.030 --> 38:02.120 there in the building is that people 38:02.120 --> 38:05.070 wanted to have that kind of debate and dialogue 38:05.070 --> 38:06.750 and that's what you're seeing. 38:07.400 --> 38:08.233 - Got it. 38:08.420 --> 38:11.370 The national defense strategy mentions 38:11.370 --> 38:15.440 the eroding, the significant erosion of military advantage 38:15.910 --> 38:18.031 and of course we have the budget coming out 38:18.031 --> 38:20.020 in just a matter of days. 38:21.594 --> 38:25.280 The first memo that Secretary Mattis put out 38:25.290 --> 38:27.800 really emphasized readiness first. 38:28.280 --> 38:31.660 And some people are skeptical that we seem to be 38:31.660 --> 38:34.540 ratcheting over back into readiness 38:34.620 --> 38:37.270 and maybe not be ready, we may not be ready 38:37.270 --> 38:41.470 to embrace lethality and great power competition. 38:41.810 --> 38:43.210 What can you tell our audience 38:43.210 --> 38:45.690 about this budget, is this going to embrace 38:46.290 --> 38:48.270 lethality and great power competition? 38:50.010 --> 38:51.600 - Well, um, first thing I'd like to tell you is 38:51.600 --> 38:54.510 I want to get a FY18 budget first. 38:54.570 --> 38:56.470 That would be helpful. 38:58.060 --> 38:59.260 Yeah, there you go. 39:00.050 --> 39:02.150 The Secretary's up on the Hill right now working it, 39:02.150 --> 39:07.150 so hopefully by, I'm confident we'll get a budget 39:08.017 --> 39:09.710 or at least a CR this Thursday, 39:09.710 --> 39:11.630 we're not gonna shut down the government. 39:11.970 --> 39:15.840 But, um, to answer your question about FY19, 39:16.220 --> 39:19.980 I'm bullish on the fact, and this is why 39:20.000 --> 39:21.650 it goes back to the Gordian knot comment, 39:21.650 --> 39:25.340 I think we can subdivide these problems 39:25.340 --> 39:26.980 and maintain focus. 39:26.980 --> 39:29.740 Now, we can do readiness and modernization. 39:30.230 --> 39:31.470 I think what ends up happening 39:31.470 --> 39:33.440 is we defer a lot of the decision making 39:33.440 --> 39:36.050 and then we bow wave, bow wave risk. 39:38.248 --> 39:42.850 I'm, let's see, on my way out stop by Colorado Springs, 39:43.730 --> 39:46.030 one of my, kind of new hats that I wear 39:46.030 --> 39:48.150 is, you know, in the area of space. 39:48.947 --> 39:53.060 We have the capability and we have the resources 39:53.060 --> 39:54.510 and we have the skills to do what we need to do. 39:54.510 --> 39:55.920 Every time I look behind the curtain, 39:55.920 --> 40:00.450 I'm bullish, I, I, you know, I, this is, 40:00.450 --> 40:01.850 I think this is the other thing 40:01.850 --> 40:03.190 that's a little bit different for me 40:03.190 --> 40:05.040 working in the Department of Defense, 40:05.500 --> 40:08.600 we didn't talk about the other guy 40:09.490 --> 40:11.040 when I was in my old job. 40:11.040 --> 40:12.850 We talked about what we were going to do. 40:12.850 --> 40:14.700 And so I think what you're gonna hear 40:14.740 --> 40:17.440 is not about what's eroding, but what's building. 40:17.440 --> 40:19.980 What we're strengthening, what we're sharpening. 40:20.430 --> 40:25.330 The uh, you know, the BC8 camps, 40:25.490 --> 40:27.790 there's no question that they've been harmful, 40:28.320 --> 40:30.560 but I'm the last person to, 40:30.760 --> 40:32.807 I've met the men and women that serve, 40:32.807 --> 40:34.390 and they are enormously capable. 40:34.390 --> 40:37.580 We need to help, they have a hard job 40:37.580 --> 40:38.900 that we just make harder. 40:38.900 --> 40:40.980 A big part of my job is to make it easier 40:40.980 --> 40:43.300 to unlock so much of that capability. 40:43.300 --> 40:45.640 And to make it easier to do business 40:45.650 --> 40:47.200 with the Department of Defense. 40:47.530 --> 40:50.100 - Well certainly talking about what we're gonna do 40:50.710 --> 40:53.560 as job one makes us less reactive, 40:53.730 --> 40:55.840 and that's an important step. 40:56.240 --> 40:58.220 Um, you know you mentioned a couple times 40:58.220 --> 41:01.110 the people and how impressed you were 41:01.110 --> 41:02.540 with the resources we have, 41:02.540 --> 41:07.080 and even on the staff side, what steps 41:07.080 --> 41:10.340 are we gonna take to take better advantage, 41:10.340 --> 41:12.870 you know, competitive advantage takes many forms, 41:13.000 --> 41:15.613 how do we unlock and unleash our people 41:15.613 --> 41:18.180 and empower them better? 41:18.230 --> 41:20.420 And I'm not just talking about within the Pentagon, 41:20.420 --> 41:22.210 but all the way down? 41:25.040 --> 41:26.950 - I don't have a (clears throat). 41:28.640 --> 41:32.863 So I know from what I used to do, 41:32.863 --> 41:35.040 and it's kind of fun seeing, sitting there 41:35.040 --> 41:38.220 talking about Mike Pedders, because we've had a long 41:40.840 --> 41:44.400 I'll say virtual relationship. 41:44.400 --> 41:47.050 We've all had this, growing up the same way 41:47.050 --> 41:50.200 is that the front line is the most important. 41:50.200 --> 41:53.780 I mean, that's where, if they're empowered, 41:55.400 --> 41:57.640 they reward you with discretionary effort. 41:58.560 --> 42:00.140 And our job, that's why, you know, 42:00.140 --> 42:02.600 in my, some of my remarks are so heavily weighted 42:02.600 --> 42:04.900 towards leadership and accountability. 42:04.900 --> 42:09.900 I think the speed that we will achieve 42:10.140 --> 42:12.770 is not by making better decisions in the Pentagon, 42:12.770 --> 42:15.670 but by putting leaders in the right positions, 42:16.330 --> 42:18.140 setting the right priorities, 42:18.140 --> 42:19.810 and holding people accountable. 42:21.010 --> 42:22.900 The opportunity we have in front of us 42:22.900 --> 42:25.980 is over the course of the next few years 42:26.340 --> 42:27.530 people will retire. 42:28.180 --> 42:32.450 And how we reward and recognize performance 42:32.450 --> 42:36.110 sends a clear message to the entire team. 42:36.110 --> 42:38.720 How we engage, I'm a big, you know, 42:38.850 --> 42:42.870 the great thing about getting the NDS finished 42:43.560 --> 42:47.140 and a budget built is now I get to go out and spend time 42:47.150 --> 42:49.760 you know, with people in the field. 42:49.760 --> 42:51.440 So, for example, you know right over here 42:51.440 --> 42:53.700 we've got the Air Boss, right? 42:53.700 --> 42:55.140 I mean, how cool is that. 42:55.630 --> 42:57.680 So I mean to me, you know, it's these 42:58.147 --> 43:00.740 being able to go out to different stations 43:00.740 --> 43:04.480 and talk about whether the plan the Air Boss has in place 43:04.480 --> 43:07.070 is, you know, flowing down, are we getting kind of 43:07.070 --> 43:07.980 the right effects? 43:08.340 --> 43:10.670 The, this is the like ultimate management 43:10.670 --> 43:13.780 by walking around job, but I mean it's, 43:15.030 --> 43:16.930 Secretary Mattis says this, uh, 43:17.530 --> 43:19.510 he says things, hey I'm writing this book, 43:19.510 --> 43:21.350 and the book that I'm writing is really his quotes 43:21.350 --> 43:23.200 not the stuff that I'm learning, but. 43:23.320 --> 43:25.969 He talks about, he says, "We don't want command 43:25.969 --> 43:29.850 "and control, we want command and feedback." 43:29.850 --> 43:32.630 And so, you can't manage from behind a desk, 43:32.630 --> 43:34.985 so I've finished this important work 43:34.985 --> 43:37.435 and now it's time to get out from behind the desk 43:37.700 --> 43:40.010 and understand through these feedback loops 43:40.010 --> 43:42.910 are the things that we said we were gonna go do happening? 43:43.820 --> 43:46.030 Where they're not happening, you know, 43:46.030 --> 43:49.495 where do we take corrective action, or, you know, 43:49.495 --> 43:51.510 change course of direction. 43:51.510 --> 43:55.590 And then make it so that, you know, we're not so rigid. 43:55.680 --> 43:57.800 I mean, we're not going to get everything right 43:57.800 --> 44:00.150 but it's that feedback loop and if we can speed that up 44:00.150 --> 44:04.520 I feel that out there on the front line 44:04.520 --> 44:05.920 people will have confidence. 44:06.320 --> 44:08.470 - Well sir, you've got a hard stop today 44:08.470 --> 44:09.303 with your schedule. 44:09.303 --> 44:12.045 So one get off the stage question 44:12.045 --> 44:14.050 before we finish here is just, 44:14.300 --> 44:17.170 we've obviously got a big industry component 44:17.170 --> 44:18.290 in our audience. 44:18.680 --> 44:21.190 You've come from industry, you know them. 44:21.490 --> 44:23.260 You've got this new mandate. 44:23.400 --> 44:25.370 What message would you give them, 44:25.370 --> 44:29.870 or what request would you make today for industry? 44:31.520 --> 44:32.830 - You know, I think the biggest opportunity 44:32.830 --> 44:34.170 for us is partnership. 44:36.900 --> 44:41.468 I think to me, you know, the partnership, 44:41.468 --> 44:43.280 it goes back to this thing around performance. 44:43.280 --> 44:46.120 How do we really get at performance, what good is. 44:46.610 --> 44:49.040 I know there's a lot of work that I have to do 44:49.670 --> 44:51.440 internally to make it easier to do business 44:51.440 --> 44:52.440 with the government. 44:52.944 --> 44:54.961 It's a big place. 44:54.961 --> 44:58.990 Let me think about, may make the comment this way. 45:00.270 --> 45:02.720 Half of what we do in the Pentagon is buy things, 45:03.307 --> 45:06.110 you know, on the services side of the business 45:06.110 --> 45:07.700 we do a thousand contracts a day. 45:07.700 --> 45:09.980 There are 30,000 contracting officers. 45:10.430 --> 45:12.160 So it's not as though, you know, 45:12.160 --> 45:15.200 with five or six meetings that we're gonna just 45:15.200 --> 45:16.870 whip the place into shape. 45:16.870 --> 45:21.870 But the combination of prioritizing here in the near-term, 45:24.000 --> 45:27.900 doing good business so we can help you to be more stable, 45:27.900 --> 45:31.260 I understand how important it is to have stability. 45:31.260 --> 45:32.950 Stability is crucial. 45:33.500 --> 45:37.100 And then, more importantly longer-term, 45:37.720 --> 45:39.100 where do we want you to invest. 45:39.100 --> 45:42.150 The clearer we can be on where to invest, 45:42.150 --> 45:43.910 we know that you're going to invest 45:44.680 --> 45:46.810 it's just we have to be very clear 45:46.810 --> 45:49.670 on how we want to integrate those investments 45:49.670 --> 45:52.950 and how we want to evolve certain capabilities. 45:52.950 --> 45:55.725 So I feel in this role there's a real chance 45:55.725 --> 46:00.060 to do something great in the sense that we have the best 46:00.390 --> 46:02.150 industrial base in the world. 46:03.020 --> 46:05.000 The commercial sector is leveraging it 46:05.000 --> 46:06.840 more than the Department of Defense, 46:06.910 --> 46:08.380 and the Department of Defense needs to move up 46:08.380 --> 46:09.880 in its ability to leverage it. 46:10.130 --> 46:12.560 - Thank you sir, and thank you for your time today. 46:12.560 --> 46:15.803 For your time, AFCEA and the Naval Institute 46:15.803 --> 46:16.810 wanted you to have this book, 46:16.810 --> 46:18.710 Great Powers, Grand Strategies: 46:18.710 --> 46:20.570 The New Game in the South China Sea 46:20.797 --> 46:23.980 by Anders Corr, has an AFCEA bookmark, 46:23.980 --> 46:25.490 Naval Institute press book, 46:25.490 --> 46:27.750 and we wish you the best of luck 46:27.750 --> 46:30.480 in your new position, which is hugely important 46:30.480 --> 46:31.710 to the success of us all. 46:31.710 --> 46:32.690 Thank you very much. 46:32.690 --> 46:35.690 (audience applause) 46:39.500 --> 46:41.240 - Thank you everybody.