The Pentagon is reorganizing its internal offices to better partner with universities and upstart technology firms to ensure the military has access to talent and research in the near future and to fortify its innovation pipeline.

Defense leaders are increasingly worried about what they describe as the national security innovation base. They hope a series of steps will make it easier to work with, and take advantage of, the leading-edge science across the country. This includes technology that spans from the concept stage to the production stage, and outlets that includes researchers to the defense industrial base.

The changes, which affect the Defense Innovation Unit and MD5, were first mentioned in the Pentagon’s budget request for fiscal 2020 and have been discussed with increasing details in recent weeks. Defense innovation leaders explained the new setup to C4ISRNET in an interview May 9.

DIU’s mission is to help the military accelerate its use of emerging commercial technologies and lower the barrier of entry for businesses that don’t already do business with the Pentagon.

Under the new approach:

- The MD5 National Security Technology Accelerator has been renamed the National Security Innovation Network. The network, which helps connect academia, DOD laboratories and users, will fall under the Defense Innovation Unit as a way to take advantage of economies of scale. Morgan Plummer, the network’s managing director, said the new name, which changed May 6, more accurately portrays the agency’s mission. The program has its own line in the budget for the first time in fiscal 2020.

- The National Security Innovation Capital fund, a new program created in the fiscal 2019 defense policy bill, will set aside investment in upstart U.S. companies so they don’t fall risk to foreign investors. U.S. leaders fear that as some startups become so desperate for funding they may not consider the national security ramifications of accepting money from overseas. “It’s an attempt to keep hardware investment on shore,” said Mike Madsen, director of Washington operations at DIU. The NSIC also aims to signal to the investment community that the Defense Department is interested in developing dual-use technologies and to provide a foreign investment alternative for hardware companies.

In testimony to Congress in March, Mike Griffin, the Pentagon’s acquisition chief for research and engineering, said that the new groups will fall to DIU “in an effort to put similarly-focused organizations under a single leadership structure.”

Perhaps more importantly, Defense leaders said the new structure will help the Pentagon “hand off” technology with a low readiness level or level of maturity until it is ready for broader adoption.

“There are these huge pools of untapped talent,” Plummer said. To take advantage of that talent means going beyond research grants in academia and instead to create a network of hubs and spokes of early stage ventures in approximately 35 communities throughout the country. While DIU has offices in Austin, Boston and Silicon Valley, creating a broader network means the NSIN would have staffers in cities such as Chicago, Miami, Columbus, Boulder, Raleigh, St. Louis and Minneapolis.

“It makes the Department accessible in a real way,” Plummer said. Previously, business leaders may see the Pentagon as a “big gray monolith” and “may not even know where the door to this place is.”

DIU will continue to focus on artificial intelligence, autonomy, cyber, human systems, and space.

The Pentagon asked for $164 million for DIU in its fiscal 2020 budget request.

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