Implementation of the Department of Defense Small Business Innovation Research Commercialization Pilot Program: Recent Experience and International Lessons

Abstract

In Section 252 of the National Defense Authorization Act for Fiscal Year 2006, Congress adopted four wide-ranging reforms to the Department of Defense (DoD) Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs in order to increase their effectiveness for both the DoD and the defense industry. First, Section 252 directed closer alignment between R&D and acquisition goals of SBIR and STTR. Second, Section 252 authorized and funded the creation of the Commercialization Pilot Program (CPP) by the DoD and the military Departments to facilitate transition of SBIR technologies into the acquisition process. Congress conditioned the use of CPP funds on detailed evaluative reporting to Congress. Third, Congress codified into statutory law President George W. Bush's Executive Order No. 13329 (2004), which incentivized manufacturing technologies through SBIR and STTR. Fourth, Congress clarified agencies authority to conduct testing and evaluation (T&E) of SBIR and STTR technologies in SBIR and STTR Phases II and III. The implementation requirements were specified in Section 252 and the Congressional Guidance Letter (2006) issued by the House and the Senate Small Business Committees. This study analyzes the implementation of Section 252 (NDAA, 2006) by the secretaries of Defense, of the Army, of the Navy, and of the Air Force based on a literature review, a survey of SBIR and STTR program executives, and comparison with similar British initiatives. The study questions are based on Section 252 text and the Congressional Guidance Letter (2006) as well as on best practices identified in relevant academic and professional literature. The study finds that although the DoD and the military departments have begun implementation of the DoD SBIR CPP and other Section 252 reforms, progress is uneven. Specifically, agencies are not implementing Section 252 CPP incentives and R&D alignment requirements to the fullest extent possible. The study recommends clarifications of legislative requirements and additional review of Section 252 implementation.