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GovDiscovery AI Podcast with Mike Shanley
Ep. 74: Michael Cadenazzi, Assistant Secretary of War for Industrial Base Policy
00:40:00
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A
Welcome to the GovDiscovery AI podcast with Mike Shanley, delivering actionable expert insight and AI enhanced business intelligence for Defense and State Department markets. Here's your host, Mike Shanley.
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Welcome to the govdiscovery AI Podcast. Our guest today is Michael Catanazzi. Michael is the Assistant Secretary of War for the Industrial Base Policy. Michael was sworn in as the Assistant Secretary of War for the Industrial base policy on September 20, 2025. In this role, he is the principal Advisor to the Undersecretary of War for Acquisition and Sustainment on industrial based policies and leads the Department of War's efforts to develop and maintain the US Defense Industrial base to ensure a secure supply of materials critical to national security. Mike, good to have you on the podcast today. Thank you for taking some time to talk with us.
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C
Thank you, Mike. Really glad to be here. Thanks for the time.
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B
So you're just back from the Honolulu Defense Forum. Listen to your speech there. What were some things that stuck with you from that trip?
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C
Thanks, Mike. It was a fantastic event. I was thrilled to be a part of it. Along with the teams from indopacom PAC Fleet, the other local commands as well as many of their international partners were there and folks from the Washington D.C. area too, we had a robust series of discussions regarding the opportunities and challenges of, first of all, maintaining and growing the industrial base within the Hawaii Islands, Hawaiian Islands and also in the broader Indo Pacific. There's obviously challenges associated with logistics, power, support, workforce that go into living in the Islands. They're working diligently to address those challenges and make a difference for the future. There's a substantial number of investments in place. Our office, particularly through the Industrial Based Analysis and Sustainment funds, have invested in workforce along with our Honolulu Community College partners to go ahead and develop tools and training and equipment to go ahead and drive better training for people in the Islands to go ahead and become skilled labor manufacturers, which is a fantastic, fantastic opportunity for folks in the Islands. These are robust jobs, they're AI proof jobs and they're directly what the Department needs out in the Pacific. We're also working directly with our service partners and colleagues at something called the Forge, which is an investment we've made again through IBAS to go ahead and grow our additive manufacturing and advanced manufacturing capabilities in the Islands, providing a capability set for partners from all the services on the island to go ahead and use to do things like manufacture parts, do training, make drones, and also some really interesting capabilities to push that forward to support expeditionary manufacturing capabilities. So directly supporting our troops wherever they deploy in the Pacific. And so we're really excited about the partnership there that that sort of allowed us to go out and do that's really blossoming in terms of support from indopacom and from the other theater commands there. So we're really excited about that and growing those capabilities in the future.
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So during your speech there, you talked about speed and scale. You've mentioned that a lot. Before we get into the solutions, what do you see as the biggest hurdles or were the biggest hurdles when you were confirmed to reaching the speed and scale levels that you feel the industrial base needs?
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C
Sure.
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B
Dow needs from the industrial base.
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C
Absolutely, Mike. So I think it's a great thing to raise is what has held us back in the past. I mean, there's a lot of money, obviously we're approaching trillion dollars this year in defense funding and yet we've struggled to sort of meet the requirements for speed and scale over time. I think the first challenge is the demand signal. And this is not a new insight. The demand sign has been fragmented over time. For example, we often go ahead and see the fidip, the Future Years Defense program where we talk about budgets are going to grow one year and it's going to be really, really demanding. And then the next year the fit up comes in and it's downward. And it looks like the department suddenly doesn't care as doesn't care about that particular program or product. And so over time what's happened is that investors have struggled to go ahead and understand where DoD is going. And as a result, they underinvest in capacity. They just assume that DOD doesn't know what it wants and therefore they're not looking to get ahead of that demand. It' very, very different from in the commercial world where you can sort of place a bet and expect things to grow at that rate based upon sort of normal market forces. Here you're subject to the winds of the department politics, life on the Hill, changing nature of life on the Hill. And those are all real things that we need to manage. So part of what we're focused on, and you've seen some of these deals that we've announced, and there's more to come, is that we're trying to go ahead and deal with the demand signal at the top level. That is, we're trying to provide much longer contracts with much higher demand that's going to allow companies to understand and plan for additional spending. They can then invest. They can flow money down to their supply chains and stabilize the demand in the supply chains and all those Companies collectively can ramp up. What that means is they're all more prepared to deliver the capabilities we need at scale and on the timeline that we want. That's a transformational approach, not because people haven't known it in the past. It's that this team has put in the time and effort and in our partnership with the Hill, has made a lot of this work for the first time in a structurally different way. That's where we're seeing different outcomes in regards to getting these deals done with industry. So we're really, really excited about that coupling that we've done. A series of investments into the mineral supply chain. This has been something that has not traditionally been the department's responsibility, but fundamentally, you can dream of ramping up capacity for production of weapons, but if you don't have the right supply of materials and minerals in particular, you can't ramp. You need germanium, you need gallium, you need yttrium. So therefore, we've taken it upon ourselves to help sort this out by virtue of the investment we've made over time. And so we're really excited to be working top down on the signal, bottom up from the mineral side and then across the middle as we work on the actual challenges and the gaps and bottlenecks in the supply chains themselves. That is working directly with companies that have unique situations. They may need to borrow money, they may need direct investment, they may need just help from the consulting side or new leadership to actually address their challenges. And so we're trying to take a very holistic approach to this to make sure we're tackling all of the challenges that have held us back from the scale and speed we need in the past. And we're hopeful about directionally this in the right way over the next 18 to 24 months for multiple programs and munitions. And that's really exciting to be a part of.
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B
It's great to hear about that demand signal and the clarity there. That's what we work on. At gov Discovery AI is helping the defense industrial base align their strategies with the open source intel. With the news, with the conversations coming out of the Pentagon. So great to hear that. I'd like to follow up on the supply chain. Can we talk a little bit about that? What do you see as the priorities for securing that, that critical mineral supply chain? Is it securing at the source? Is it recovering of recycling of the critical minerals? I'd like to get your thoughts on where do you see the priorities there in securing that supply chain?
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C
Sure, it's a great question. So there's a lot of minerals. I'm spending more time looking at the periodic table of elements now than I have since high school, which is pretty demanding. And every day we're getting new calls for focus on minerals that we haven't discussed in the past. The way the department has done this, we actually have within our industrial based resilience team within ibp, a team that actually focuses exclusively on minerals. It's a combination of government experts and contractors, engineers, scientists, analysts. Their job is to go through all of our individual program needs and baseline what requirements we have for minerals, that is be very specific down to the individual minerals themselves, going into which particular portions of the platform. We've developed a series of analytics that basically are a heat map, for want of a better term, which is identifying the minerals that have significant problems and they're at the top of the list. And minerals where we think we have reasonable amounts of supply and demand access at the bottom of the list. So red at the highest level, green at the bottom. For each of those minerals, we're then building out what we call a value stream. The value stream is essentially from mine all the way through to recycling all the different steps that are necessary for that particular mineral to provide the capabilities we need within the industrial base. And then what we're doing is we're making determinations of the types of investments necessary to convert anything that's red to green. And so what we're trying to do is actually make sure that we're talking tangibly about the types of minerals, the companies that make that, its availability at volume, and then tying that into the broader domestic demand. So we understand what portion of Domestic demand is DoD demand, in some cases, DoD demand is a significant amount of it, particularly for things that go into, say, night vision and engines, other things, for example, rare earths, where we're a very small portion of the domestic demand. And so we're trying to go ahead and be realistic about where the DoD can have impact. And then we're executing on those demands by striking deals and actually having discussions with providers at every level, refining, processing down to production to say what can you do for us over what time frame, what investments are necessary? And then ultimately gauging what that gives us relative to our capability demands. And so it's a very complicated process. It's robust. We're in dialogue with our industry partners every day. We're in dialogue with the NSC and the National Security Council as well as our partners and other agencies to make sure that we're all working collectively to Address the issues. And to date it's been very successful. We've had a series of very successful investments that are making a difference and will make more of a difference over time as more capacity comes online. So it's an exciting thing to be a part of and probably not what I was expecting to spend so much time on in this job. But I'm learning a lot and it's been thrilling to work with such an incredible team that's such deep expertise in the mineral sector.
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B
Let's go bigger picture to the broader industrial base. A lot of our clients are small to medium sized businesses. So you mentioned L3Harris. It'd be good to hear a bit more about that investment, the recent Lockheed agreement. But let's talk about the small to medium sized businesses. What do you see as their role in the defense industrial base?
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C
Sure. I mean the defense industrial base is incredibly dependent upon a large number of smaller firms, particularly at tier 2, 3 and 4. We often talk about the mom and pops that are out there. We're heavily reliant upon these firms. Many of them are multi industrials. They bend metal, they make a particular product, they sell that to multiple programs. They often sell that to multiple markets. So may they sell it to commercial airlines as well as defense. They may sell it into something like transportation, so something around rail or vehicle or automobiles, whatever that might be, and also sell into the defense sector. So they're incredibly important. They've been historically challenged in terms of the demand signal on the defense side. Many of them have chosen to stay in the defense business despite the economics of working against them. So they probably could make more money and have less hassle not serving the Defense Department. We've often pleaded with them or done special deals for them to sort of retain their focus here to our benefit. And we want to make sure that we're taking advantage of their capabilities and rewarding them. We think that the accelerated demand signal of the new contracts is really part of that, which is providing them the stability they've never had before so that they understand that, hey, we're not just buying from you lot by lot. We're not treating you like a transactional partner. We're actually investing in this capability for the long haul. We're investing in those companies for the long haul. And then we are trying to couple that with those other tools we have to either do loans. So the Office of Strategic Capital is one of our partner organizations within R and E that actually has the ability to go ahead and make very exquisitely tailored loans for companies at really great rates. That's something we want to make more available to firms at the lower tier of the supply chain so that they can go ahead and scale up and address our financial needs as they're meeting ours. So we're really excited about the potential to do more of that and then also again to make their lives easier by dealing with some of the lower tier minerals and materials availability so that they're not scrambling to buy stuff that they need to go ahead and produce for us. We're hopeful that those investments will make products more generally available and if that happens, we think they'll do a better job of delivering what we need. So it's all a win win to our point. The more that they succeed financially and economically as well as at the factory floor in terms of production, the more the department is going to meet its own needs as well.
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And obviously their role is very integrated with some of the larger primes. Can you talk a bit about some of the recent news with El3Harris or some of the other primes about how that helps strengthen the industrial base but how it's not just a deal with a prime, but it engages these small to medium sized companies who are those second, third, fourth sub tier companies underneath them?
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C
Sure. So if you take the recent deal we did on PAC3, it really is a transformational head of agreement deal and we appreciate the support from the Congress to authorize that in the FY26 NDAA. That deal basically allows us in partnership with Lockheed to go ahead and plan for a longer contract time. So seven years and a much higher demand signal. So a transformational ramp, basically 3x more than 3x capacity, improvement on current delivery rates. And so for us that's really exciting because that's going to lock in Lockheed's capacity. It's also going to lock in capacity from Lockheed's key suppliers at every level. So their tier 2 suppliers or tier 1 suppliers are going to lock in their their folks below that. We're in discussions with some of those suppliers now as you've talked about with the deal on Rocket Motors where we're trying to provide again transformational ST for them as well. So they understand that they'll have the ability to invest and ramp up in the same way that Lockheed is. That program is built specifically to allow them to invest down. That is additional money should flow, stability should be established at the lower tiers. That is going to allow those other companies to commit additional resources. Some folks are going to need to hire workforce, they're going to need to invest in their factory lines. They're going to need to buy additional materials and equipment ahead of time. All that's going to be really fantastic for our reliability. And that to us is what the most important thing is when you talk about speed and volume. We want to make sure those munitions are being delivered on time and they're delivered on target. And so for us, this is a way for us to go ahead and make sure that everyone's aligned to the same way. We're all rowing in the same direction to make sure those munitions get here. It's been a significant problem. Again, you mentioned my trip to Honolulu. One of the major concerns from the combatant commanders there remains magazine depth and their ability to meet the requirements for their various O plans, our operational plans. And so we're excited that this is a way to contribute to that structurally.
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B
All right, Mike, let's switch to Honolulu. You talked about the industrial base of the Allies. What do you see as the role of the allied industrial base in strengthening the US Industrial base?
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C
Sure. So this is a major focus for everyone in the department. In my role in industrial based policy, we had what is the international cooperation team in the FY26 NDAA? We split that out. Now there's gonna be a separate ASW Assistant Secretariat for International Armaments Cooperation that's gonna own the responsibility for our relationships with these allies and partners in many ways. And they're gonna bring over the Defense Security Cooperation Agency and the Defense Technology Security Administration. DISKA and DITSA are gonna move underneath acquisition and Sustainment and operate in partnership with IAC to make sure that we're all aligned in terms of how we operate with our allies and partners for the future. It's an exciting alignment because it's going to bring together those foreign military sales and those direct commercial sales of our weapons platforms to partners in alignment with our overall production capacity and plan, which is underneath acquisition and sustainment. And my boss, the Honorable Mike Duffy. So as we go to a place like Hawaii, we get to meet with our partners. Everyone's really excited about the alignment because the challenge has been with FMS and DCS has been our inability to deliver on time. Orders are being taken and they're often planned for delivery dates that are two, three, five, seven years down the way. That's unacceptable for some partners. They're frustrated, we're frustrated, and so we're able to do a better job. We think of aligning the capacity demands of the future to make sure that collectively we're working on the production lines all these debates tend to come from or debates around FMS tend to come from one problem that is simply not enough capacity. So we need to work really hard to go ahead and make sure that that capacity improves. We're excited about that and aligning those pieces from our standpoint with our allies and partners as well. What we want to do is make sure that we're taking advantage of their expertise and capability. So the US has a robust defense industrial base. We buy a lot of, we build a lot of products. We are not likely to buy a lot of all up round final n items from our allies and partners. Some we do, they're individual things. We buy rockets, rifles, things like that, unique technology, radars that are terrific that we buy from our European and Asian partners. However, in general we're not going to buy a lot of end items from those folks. What we are going to buy are many components and systems and subsystems. And so we're particularly excited about the ability and we had a lot of discussions around this when I was in Honolulu was the ability to expand our acquisition at the parts level, at the subcomponent level, at the assembly level from our partners. So where they have electronics, where they have assemblies, they have unique things that complement our tools. We want to qualify those capabilities and bring them in so that we can include them in our items here. That's a great way for us to partner with them to find best of breed capabilities and make sure that we're leveraging them in the best way possible to meet our own needs. And so it's really exciting to see those agreements going forward. Everyone's excited about the additional focus that the reinvigorated ASW for international armaments cooperation is going to bring to this. And I think it's going to be exciting time to be a part of that as well.
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B
Yeah. So for that Office of the again, the Assistant Secretary for International Armaments Cooperation. Do you see the primary benefit is the streamlining of these various priorities creating a very clear demand signal or are there additional policy changes that you're anticipating both for foreign military cells as well as buying from the allied industrial bases?
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C
So I think the demand signal's been clear. Orders are very robust. There's a huge backlog for defense systems. So the demand has not been the problem on the international side. It's been production. It's been our ability to deliver at the rates required. So we're really glad to see this come together. It's going to help us on the production side to invest additional resources where necessary. To make the changes necessary at the factory floor to ensure that we're ramping up in advance of that demand. So that to me is where the greatest opportunities for synergies are. And in general, we're hopeful that the policy process itself, that the process that enable FMS and DCS can be accelerated. There's just some bureaucratic hurdles there that we need to work through. But we're keen to go ahead and spend some time to focus on that as well. There's probably some additional synergies we'll see. And then some policy changes will likely come out of this in time too. There's a lot of scrutiny on FMS and DCS sales from the White House on down. We're excited because that additional focus means that we can bring additional attention to the problem that have inhibited speed in the past. And they're also going to bring new additional investment to the production line. And that ultimately is where the key unlock is.
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B
Let's talk about the process of the procurement, the actual contracting mechanisms and streamlining of compliance. Higher level. What do you see as the Pentagon? How is the Pentagon making it easier and faster for the defense industrial based, allied smaller shops to handle just the compliance and requirements of contracting with the Defense Department?
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C
Got it. So I think you saw the acquisition transformation strategy came out in November. Secretary Hegseth announced that it was very exciting to be a part of drafting that document. Aspirationally. It lays out a set of really robust and aggressive targets for how we can improve the way that we're going to operate in partnership with industry in the future. So many much more streamlined approaches. The use of commercial tools like other transaction authorities or OTAs, adaptive acquisition tools. We want to make that the standard. And I think the President's been clear on that front since the early days of the administration with the executive orders that came out around changes to the industrial base and how we would acquire for the future. That's been backed up by additional talk and leadership from Secretary Hegseth and Deputy Secretary Feinberg as well as Mr. Duff. So we're keen on those impacts and I think it's really the focus on it again, much like the demand signal. Many of these ideas have been around for a while. They've been difficult to execute and align. We're really committed to spending the time to make sure that the teams that are out there are focused on taking advantage of these tools that are driving efficiency, that we're teaching best practices to our contracting officers. That's one of the great opportunities with transitioning from DAU to the War Fighter Acquisition University or wau, that we're going to go ahead and change the best practices model that's actually going to go ahead and encourage them to use these tools for the future as a standard and only default to the cost standards and the cast tools that we have when necessary, and there's times when it is necessary. We recognize that commercial tools and commercial pricing may not be the best model for every solution at every time. Particularly when you're doing something that's dangerous or highly complex. Pushing the bounds of physics, as some of our programs and processes do. We want to make sure that wherever possible we're applying the right tools. We also want to streamline things like certification, qualification, test, those kind of things. There's been a lot of bureaucracy in those. A lot of times we're tethered to previous requirements, for example, for tests and those tools that are there. Sometimes we're under capitalized. So we want to make sure that we're buying more test equipment if that's going to accelerate things. Other times we're anchoring ourselves on test requirements that were developed during the Cold War. We need to bring those requirements forward and make sure that they're appropriate for the moment. Some of the times our standards were set on things like the ability to have a weapon in a magazine for 40 years and have it be stable and still be usable. Potentially we don't need it to be on the shelf for 40 years anymore. Given technology refresh cycles, the way technology is being developed, maybe having it on the shelf for 20 years is enough. That would change the way that we test and certify some of these purchases and that'll give us some speed and scale opportunities as well. So in general we're really excited about the potential to do new things, apply new approaches, but also just to leverage many of the available authorities that are out there. In my discussions with the Congress, one of the most compelling and consistent points has been why are you not using the existing authorities to the full extent with which we are determined? And I think that's been a risk averse culture in the past. We're trying to change that. We're trying to embrace risk and take advantage of these authorities and maximize their application wherever possible.
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B
Have you seen some early wins, cultural changes, progress towards that goal of having a more risk embracing procurement process? I don't know if you might phrase it differently than that.
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C
Sure. No, I think that's a great point. I think the example we had with PAC3, that agreement reflects a really robust embrace of a new model for ramping up demand and stabilizing the supply chain for a particular munition. We're eager to apply that same model to other munitions and you're going to see some of that rollout here hopefully in coming weeks and months. And also the deal around solid rocket motors, again, a very differential approach that embraces risk to go ahead and improve overall sourcing. For the solid rocket motor industrial base. It's going to change the way that we buy, it's going to change the way that we incentivize. And we're really excited because it has been an industrial base base that has suffered from instability in the past. It's inherently dangerous, it's got some explosive elements to it. It's hard to do it. It's been disrupted by lack of access to materials and workforce in the past. We're excited to be working diligently to stabilize that industrial base and make it much more robust for the future and also position the industrial base to take advantage of the number of new competitors that are out there and that are eager to deliver rocket motors for the future. So overall we're just super excited about, about those two at scale examples of how we're driving change in the way we're buying and working with our industry.
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B
Partners as we work with venture backed companies across the US in Silicon Valley, in Austin, in Boulder. I wouldn't say it's a barrier to entry, but there's an awareness that there's the contracting process, the pricing process, there's going to be a challenge there. So for those newer entrants, those growing defense tech companies, what's your message to them on what's changing, what they should be prepared for based on these new activities, these new priorities and this refocus on actually making a clear demand signal and sustainable changes to the procurement process.
- [25:08]
C
Sure. So I think it's a great point and we're really excited about the number of new firms that are private equity venture capital backed that are entering the space. This is something we've asked for for a long time. I'd take you back back 20 years ago when the department was really eager amidst the conflicts in Iraq and Afghanistan to have more companies come from Silicon Valley and elsewhere and work on defense problems. And essentially many of them said no. Many companies didn't want to deal with the bureaucracy. Many were not interested in defense work, period. For ideological reasons that are best left to the past. So right now, all of a sudden, this most recent time we have, companies have turned up, they're capitalized they have tremendous workforces, they have products, they have a real interest in playing. And they've asked to be let in the door and treated as equals. And so you've seen a robust embrace of that from the department where these companies have been given a chance to compete. They have been brought in on programs, they're participating and winning on major programs as well. I think they've learned to navigate the amount of bureaucracy that's there. It's never going to be zero, it's never going to be as fast and nimble as as the commercial world is. We're making weapons of war and therefore there's a level of requirement that goes into that. However, I think they've done a masterful job of adapting to these new marketing requirements for them to succeed. And I think you're gonna see more of that going forward. They've learned the lessons, they've hired the people, they've acquired smaller companies, they've done all the things necessary that previous generations of firms have done to succeed. And as we're removing layers of bureaucracy, we're hopeful that that'll actually take what is there. Their good faith efforts to meet us where we are will naturally get better and faster and cheaper for them over time. And we're hopeful that collectively that's going to benefit the industry writ large.
- [26:52]
B
One of the other challenges for the industrial base is surge capacity. Creating the surge capacity required to sustain various operational scenarios. How are you thinking about that in terms of contracting? How do you ensure in the most cost effective way, or maybe this is where the risk comes in that the industrial base is delivering the surge capacity that is necessary for various potential future operational scenarios?
- [27:21]
C
Sure. So that's a challenging topic because traditionally we've done a lot of very exquisite math and budgeting to get us to a number and said this is how many units we need and if you over facilitate, we viewed that as a failure. And so unused capacity in the past has often been scrutinized and then removed. Think about something like BRAC or other versions of that. And Congress has not looked too fondly on that. Programs haven't looked too fondly on that. And as a result we have very limited surge capacity. We understand that and we're trying to go ahead and incentivize our industry partners to go ahead and grow rapidly and also grow enough capacity that they think through the structural requirements, whether that's automation, whether that's additional inventory, whether that's additional workforce, and to start thinking now about the requirement to go ahead and grow beyond their current production rates and even beyond the production rates that we've laid out for the future. That is not an easy thing. We think over time that collectively the amount of additional incentives we'll provide with these higher range, longer volume, longer duration contracts and with the incentives we've laid in for growth, that we'll find that firms have the ability to say to us, look, if you want me to do more, I can do more. Sometimes we'll have to go ahead and strike a deal for them to keep that capacity warm or they'll shed it. Other times we think we'll find ways for them to use it. Maybe not in the program that they initially intended it to, but for them to say, all right, I've got a problem over here. I'm saying I went for originally planned for Navy capacity and maybe we move that to Air Force capacity, but it's capacity and we'll think about how to do that more thoughtfully in the future. But in general we're just trying to ramp up at the moment to get enough capacity to meet our urgent demands which has been unfilled in the past. And so I think there's a bit of a time lag before we need to worry about having too much surge capacity. We would just love to have some capacity at the moment and I think I'd be happy to see that grow rapidly for the near term.
- [29:19]
B
Let's talk about businessdefense.gov Mike, can you share what is on that website? What's the purpose of it? How can the industrial base engage and learn about the priorities and opportunities to support the Pentagon on that website?
- [29:34]
C
Sure. So the Industrial based Policy office manages four teams that work directly with industry on a day to day basis. Our Office of Small Business Programs which is focused on bringing in smaller companies and new entrants for the future. Our Global Investment and Economic Security team which manages is M and A Transactions international under the CFIUS program. The Committee on Foreign Investment in the US Domestic M& A outbound M and A and also Adversarial Capital Action. So they're talking and reviewing transactions day in and day out with our industry partners at every level. Our Industrial based Resilience team which manages our industrial based analysis and sustainment and the Defense Production act funds. So that's direct investment to industry. It also manages our program for evaluating DX DO ratings for companies, I.e. prioritization within the supply chain. So we're working every day to make sure that defense programs and companies get the attention they need and their orders get the attention they need from the industrial base. And then our international now was international cooperation. It will now be the International Armaments and Cooperation Team which is working every day with our industry partners on FMS and DCS deals. So the website reflects access to all those programs. I would encourage everyone to come and register as appropriate. Within our small business programs websites. There's a ton of new tools we'll be rolling out over the next few years on CMMC requirements. So cybersecurity requirements, as well as helping find opportunities for small firms to engage in the defense sector. We have some great tools coming out from the team there. If they can go to our various OTA consortiums, the Cornerstone Consortium or the DIB Consortium, please sign up a way for us to reach out to you connect, talk about what our needs are and how we're going to plan to invest for the future. There's a robust dialogue underway constantly with those firms and so really excited about everyone that wants to come and register there. And more generally, as you have opportunities, products, interests, reach out to our team. We'd love to hear from you. We have contacts every day with industry firms at every level, from the smallest, most esoteric firm up to the largest. And so we're really excited about that robust dialogue we have. And it informs, helps inform what we need to be thinking about and how we need to invest for the future.
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B
I don't want to get too far ahead of any announcements, but for those future plans you're looking to roll out, can you share any more about what ones you might be most excited about or you think are going to be most transformational that your team's working on?
- [32:02]
C
Sure. So I think the programs around small business are going to be the most exciting for us in the near term. We're hopeful to have an announcement in the next week or two regarding some of the new tools, which is going to be a combination of an improved version of our current project Spectrum cybersecurity certification tools, coupled with a series of business development and go to market tools which will help firms actually understand how to target their business and grow it. We're also providing a tool for them to basically take small firms and they can go ahead and live in our CMMC certified cloud. And so if you're a small business and you don't want to go through the whole process of getting CMMC certified, you can go ahead and do all of your Defense Department work through the cloud and it'll save you time, it'll save you effort. We think it's going to be really powerful once it's up and running, particularly for smaller businesses. There's a lot of firms that are, you know, kind of mom and pop shops. Maybe they're doing lawn work, maybe they're doing fixing toilets or doing construction or small jobs for the department. Many of them aren't going to want to go through the hassle of getting fully CMMC certified. It's maybe not worth it for them, frankly, on their IT systems, given the type of work that they're doing. We want to keep them in the sector and more importantly, we want to incentivize new firms to come to the sector. So this capability and tool set is going to be incredibly important for just streamlining their lives and making easy access to the department's requirements. And so we're really excited about rolling that out here and helping those firms succeed for the future. And I think it's a great testament to the department's commitment to its small business partners that we're gonna do much more of this going forward.
- [33:35]
B
I'd like to hear your thoughts on how that engagement from industry, how it can be most effective. Obviously you don't want a thousand emails with here's our capability statement and how we can help you. Coming through from our end, what we focus on is helping those small businesses, those medium sized businesses, identify first the demand signal, then based on their capabilities, how their solutioning aligns with what your team is looking for. Can you share any thoughts on that or any stories of, of where you've had successful effective engagement? Again, where it's not just here's our PDF capability statement, how we can help, but where industry is engaged with you or with your team really in a productive way where they know the demand, deliver the solutioning and make that conversation very efficient.
- [34:19]
C
So that's something we do every day. And it is not my program, it's something I inherited from the fantastic leadership of the past that's built the Industrial Based Analysis and Sustainment Fund and the Defense Production Act Fund, where, where money is appropriated by Congress, they give it to the programs. We then go off and create programs and investments with our industry partners. So we've invested in everything from workforce to ball bearings. And so we're constantly digging into these new challenges. So for example, I mentioned the Honolulu Defense Forum and our work with Honolulu Community College. That's a program that we worked through directly to meet Indo PACOM requirements for tools to increase the capacity and availability of skilled labor in the Islands. Right. And so that's a fantastic example of where we went out. We Created something with our partners. We've done the same thing down in Danville, Virginia with our maritime welding program, A program that provides basically a 16 week scholarship for folks to go ahead and come there. They learn to weld, they're given an apartment, there's child care available if you need it. And then we're basically setting them up with jobs on the back end with our industry partners. So it's an incredible program. We have over 50 workforce programs over at large. We're going to announce a large workforce and manufacturing program as well, probably in the next couple months, which we're excited to use as an anchor to tie all of these various initiatives together. But if you look more broadly, you could go through dozens of things that we've done in the past. Electronics, castings and forgings, batteries. We've made investments in all these capabilities. Electronics, microelectronics, printed circuit boards. Collectively, we've invested I think $2 billion last year into programs across or in last fiscal year. That's a tremendous commitment to the industrial base from this program alone. And that's a complement to the funds that are going out from our service partners and other agencies as well. So we're really excited about that. If all you have is an email and you want to reach out to us, please do. But I recommend logging into the DIB Consortium or the Cornerstone Consortium websites and signing up for the announcements that are there, there. It's a fantastic way to stay connected with us and understand more about our requirements.
- [36:25]
B
Mike, as we're getting ready to wrap up here, two last questions. One is for you. What is your priority for 2026?
- [36:34]
C
Great question. I am most focused on trying to help continue the transformational work of these new deals and what we're doing to go ahead and structural demand in a fundamentally different way. We think that these provide a new capability for the department to leverage when it needs scale, when it needs to ramp up capacity. We think this is incredibly important. We also think this is directly going to tie to operational plans and needs for many of our combatant command leaders. So for us, number one, that is where I'm spending a lot of my time. In partnership with that I'm working on these minerals and these supply chain transactions because you can go ahead and establish all the demand that you want. But again, again, we've got to work bottom up on the minerals and materials. We've got to work across the supply chains to remove gaps in bottlenecks. That allows us to have robust discussions at every level with firms where we can Help them stabilize and improve their performance. For me, it's an honor to be doing this job. I run a team of over 400 people that's working across all these different categories. It's incredibly talented group of government, civilians and contractors that is spending work every day looking at supply chains, looking at opportunities in the industrial base to improve our performance. And for me, it's truly a thrill to have the kind of impact where every day you can go out and talk to companies where you're making direct investments and seeing the performance change over 12 to 18 months as a direct result of our efforts and the efforts of the team. So really fantastic. Tons of good stuff to do and I'm really excited to be a part of the team here in the Department of Work.
- [38:07]
B
Last question then. So what for the industrial base? What's the so what that you want to leave with everyone? From this conversation today.
- [38:16]
C
From our standpoint, we're at a transformational window for the dib. We need a lot more from you. We need your investment, we need your focus, we need your talents. We're looking for the most creative ideas and outcomes. I think we need radically different outcomes from the Department of War, from the defense industrial base. We need radically different processes and inputs to generate those radically different outcomes. So for me, I'm looking for the most extreme ideas, the most interesting and provocative thoughts and thinking about how we can get more from the industrial base. So don't hesitate. Come to us when you see me at a conference or when you send that email in with your prospectus. Make sure you're coming along with an idea of how we can go ahead and do something different. The same old has not worked well in the past. No one's happy with it. That's why we're really excited to be doing something fundamentally different at this time. And again, I'm really honored to be a part of it.
- [39:08]
B
And as well, well, that is Michael Kadanazi, Assistant Secretary of War for Industrial Based Policy. Mike, thank you for being on the Gov Discovery AI podcast with us today.
- [39:18]
C
My pleasure, Mike. Thank you. Appreciate it.
- [39:20]
B
Thank you.
- [39:23]
A
Thank you for tuning in to the Gov Discovery AI podcast with Mike Shanley. Gov Discovery AI leverages our team's decade of experience winning federal funding to deliver federal growth intel to sales proposal and capture teams working in defense and civilian markets. Each market intel report is delivered by federal growth experts leveraging our proprietary deep data discovery process. If you enjoyed today's show, be sure to subscribe wherever you get your podcasts and connect with Govdiscovery AI and Mike Shanley on LinkedIn or learn more at govdiscoveryai.com.