Artificial Intelligence (AI) seems to be infiltrating all
aspects of everyday life. It should come as no surprise, then, that
the Federal Government, particularly the U.S. Department of Defense
(DOD), is taking notice of the ways in which AI can improve its
warfighting capabilities. To compete with—and
surpass—our near peers, including China and Russia, DOD is
rethinking the ways it procures technology and systems that use AI
to support weapons systems, other vital military equipment, and
internal operations.
As part of its efforts to streamline and improve its acquisition
processes for advanced technologies like AI, DOD is making a
concerted push to work with industry leaders to address specific
needs with solutions that would previously have sounded like
science fiction. This creates an opportunity for government
contractors to play a role in shaping DOD’s AI policies and
procurement processes for acquiring AI-enabled solutions. Two
leading aspects of DOD’s AI procurement overhaul are the Chief
Digital and Artificial Intelligence Office (CDAO) and the Tradewind
Solutions Marketplace (Marketplace). Through those initiatives, DOD
is seeking to accomplish the following AI goals:
- Accelerate the delivery and adoption of AI;
- Establish a common foundation for scaling AI’s impact
across DOD; - Enable decentralized development and experimentation;
- Evolve partnerships with industry, academia, allies, and
partners; - Cultivate a leading AI workforce; and
- Lead in military AI ethics and safety.
U.S. Department of Defense, SPOTLIGHT Artificial
Intelligence, https://www.defense.gov/Spotlights/Artificial-Intelligence/.
Contractors in this space should familiarize themselves with these
overarching goals and DOD’s specific initiatives to improve its
procurement processes for AI solutions. We review some of DOD’s
efforts below.
Chief Digital and Artificial Intelligence Office
Previously, DOD approached AI in a decentralized manner: each
military branch had one or more offices focused on AI procurements,
projects, or oversight. This led to disjointed and often
duplicative efforts because each office was essentially reinventing
the wheel instead of learning from others’ mistakes and
successes.
DOD recognized that to move quickly and be a leader in AI, it
needed to consolidate its efforts into a single office: CDAO. DOD
created CDAO in 2022 by integrating the Joint Artificial
Intelligence Center, Defense Digital Services, the Chief Data
Officer, and the enterprise platform Advana under one umbrella led
by DOD’s Chief Digital and Artificial Intelligence Officer.
Although the military branches, and even specific installations,
are still involved in individual AI procurements and projects, CDAO
is the lead office for the acceleration of DOD’s adoption of
data, analytics, and AI solutions, bridging the divide between the
battlefield and the boardroom. See Chief Digital and
Artificial Intelligence Office, www.AI.mil.
The National Defense Authorization Act (NDAA) for Fiscal Year
2023, Pub. L. No. 117-263, directed organizations within DOD to
support CDAO’s efforts to reform DOD’s AI procurement
processes, cementing CDAO’s role as DOD’s leader in AI. In
that role, it aims to perform several critical functions:
- Lead DOD’s strategy and policy on data, analytics, and AI
adoption; - Oversee and govern AI efforts across DOD;
- Enable the development of digital and AI solutions across
DOD; - Scale proven AI solutions for enterprise and joint use cases;
and - Harness the talent of technical experts that can serve as a
data and digital response force capable of addressing urgent crises
and emerging challenges with state-of-the-art digital
solutions.
Over the past year, CDAO has established the CDAO Governing
Council, which is a “4-star” level governance body that
replaced the former “3-star” AI Executive Steering Group
governance body. CDAO has also taken significant steps to ensure
the responsible use of AI within DOD. For example, CDAO took a
leading role in creating the Responsible AI (RAI) Strategy and
Implementation Pathway, which established the roles and
responsibilities for implementing DOD’s 2020 Ethical Principles
for AI. CDAO has also focused on creating RAI resources for AI
developers and practitioners so the products and services they
create and ultimately provide to the Government have ethical
standards embedded in them.
Tradewind Solutions Marketplace
One of the major initiatives from the CDAO is the Marketplace.
Although the concept of the Marketplace predates the establishment
of CDAO, the new office streamlined the Marketplace and made it
more user friendly.
The Marketplace is one of the ways DOD has started to move away
from the standard government contracting processes that make the
rapid procurement and delivery of goods and services challenging.
Rather than submit a bid directly to a government customer as they
would in a traditional procurement, companies, academics, and
individuals upload five-minute video pitches to the Marketplace.
DOD organizations can then review and compare videos to determine
which technological solution best fits their current needs. This
process stands in stark contrast to the traditional procurement
process, which the U.S. Government Accountability Office (GAO) has
deemed “incompatible with the fast speed at which AI
technology is developed.” GAO, Artificial Intelligence:
Status of Developing and Acquiring Capabilities for Weapon
Systems, GAO-22-104765, Feb. 17, 2022, https://www.gao.gov/products/gao-22-104765, at
page 23. GAO also found that DOD’s acquisition processes
“can be a potential barrier for small and nontraditional
companies who may be less familiar with DOD-specific requirements
than large companies.” Id. Small and nontraditional
companies may not have the resources—both time and
money—to become acquainted with government procurement
processes, and might instead choose to abandon their plans to
engage with DOD.
Thus, part of what makes the Marketplace a novel approach is
that it moves away from the lengthy processes that have long been
the cornerstone of government procurement. The Marketplace’s
streamlined processes will make it easier for small businesses and
nontraditional defense contractors to identify and participate in
contracting opportunities with DOD for AI and other innovative
technology solutions. DOD customers can now procure directly from
the vendor whose solution they believe will best solve their
problem, without having to prepare a sole source justification and
approval.
Instead of issuing individual solicitations, the Marketplace
posts procurement announcements that list DOD’s broad strategic
focus areas. For example, the focus areas in a recent Marketplace
announcement included improving situational awareness and
decision-making; implementing predictive maintenance and supply;
streamlining business processes; assuring cybersecurity; and
discovering blue sky/other technology applications. The
Marketplace’s procurement focus areas will change as the
customer base and mission priorities supported by the Marketplace
evolve. Accordingly, CDAO encourages companies and research
entities that are interested in selling their AI products or
services to DOD to regularly check the Marketplace website for new
announcements.
Each announcement includes the submission guidelines with tips,
basic eligibility requirements, and the video submission scoring
rubric. Each video must include four major elements: identification
of the problem(s) addressed; a description of the solution and its
application to the problem; the potential impact of the solution if
DOD adopts it; and how the solution differs from other, similar
solutions. Price is generally not addressed in the video submission
because the agreed-upon price will depend on the scope of the final
effort. Interested entities can create a free account and begin
uploading video pitches. Each video may contain only one solution,
but entities can pitch multiple solutions in response to an
announcement by uploading separate videos for each solution.
A new submission/collection period opens each month, and an
assessment panel of experts from academia, industry, and government
evaluates the videos uploaded during that period based on the
announcement’s scoring rubric. The panel determines whether
each submission is awardable or non-awardable and the appropriate
contract types for awardable submissions. The assessment
panel’s decisions are available thirty days after the end of
the relevant collection period. Submissions deemed awardable are
made available on the Marketplace. Then, rather than starting the
acquisition process from scratch, interested DOD customers can
contact an awardable entity directly to negotiate the terms of the
contract, including the price, scope of the effort, project
milestones, project deliverables, period of performance, and a
definition of successful completion of the solution.
For submissions deemed non-awardable, the evaluation panel
provides feedback to the submitting entity, which can resubmit its
solution after addressing the recommendations. Submitters have
unlimited opportunities to continue to refine and resubmit their
video pitches.
The Way Ahead for DOD’s AI Procurements
DOD’s AI procurement efforts have shown no indication of
slowing down, and we can expect this trend to continue. DOD will
need to continue to rely on its industry counterparts to fuel its
growth in this area, or risk lagging behind other countries. To
achieve those goals, we expect CDAO to continue building
relationships within DOD, with other agencies across the
Government, and with industry.
Now that the Marketplace is established as a means to quickly
procure AI programs and services, CDAO may focus its attention on
ensuring that the AI it acquires meets DOD’s Ethical
Principles. This will include implementing the goals and procedures
established in the RAI Strategy and Implementation Pathway in
DOD’s procurements of AI solutions. CDAO is considering tools
that could facilitate implementation of the Pathway’s concepts,
such as bias mitigation or explainability, machine learning
operations, and continuous integration/delivery. It is also
planning to expand the range of tools it releases to AI developers
within the Government and the private sector so the developers can
incorporate RAI from the outset of the development process.
We expect CDAO to continue casting a wide net in terms of the
types and uses of AI that it addresses. The office is also seeking
to foster AI development and innovation outside DOD, including
starting an academic consortium to encourage more basic research,
expose students to DOD problems, jumpstart innovation, and develop
a cadre of experienced RAI practitioners. To that end, CDAO
continues to engage with interested parties at industry days and international events on future data collection
and policy initiatives to allow DOD to take advantage of private
sector expertise.
Grace Moore, a Wiley 2023 Summer Associate, contributed to
this alert.
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