Technology as a Strategy- Lessons from the Defense Industry
For decades, the defense industry has let tech carve the path and trusted results to follow. It’s a perspective businesses could learn from.
The F-117 Nighthawk stealth fighter didn’t start with a business case. Neither did Amazon Web Services nor Spotify’s streaming platform. What ties these breakthroughs together? Technology took the lead. For decades, the defense industry has embraced this mindset—letting tech carve the path and trusting results to follow. It’s a perspective that challenges businesses tethered to ROI and rigid plans, where true disruption often gets left behind.
The Blind Spot of ROI Calculations
We live in a world ruled by the business case. Every investment hinges on ROI. Development projects rise or fall by payback periods. Business case first, no exceptions.
At its best, this mindset just polishes what’s already there—tweaking processes, automating routines, trimming costs. A small gain here, a slight edge there, but nothing breaks new ground. It’s treading water, not making waves.
Spotify’s rise tells a different story. They didn’t aim to sell CDs “more efficiently”. Instead, they let technology redraw the map—reimagining how we consume music. Streaming wasn’t a safe bet; record labels and analysts scoffed at its potential. Yet Spotify trusted the tech to deliver results, and now it’s a titan in the music industry.
In today’s whirlwind of technological change—AI, quantum computing, and beyond—clinging to the status quo won’t hold a market. These emerging tools unlock possibilities we can’t yet fully see. Sticking to ROI-driven thinking risks missing the next big shift. It’s time to rethink the playbook.
The Defense Industry's Model of Innovation
The defense industry has spent decades developing and utilizing technology without immediate use cases.
DARPA (US Defense Advanced Research Projects Agency) director George H. Heilmeier developed what became known as Heilmeier's Catechism - eight questions including: "Why now? What if we succeed? What makes this possible now?" These questions are valuable because they shift thinking away from immediate needs toward technology-enabled possibilities.
Lockheed Martin's Skunk Works (Advanced Development Programs) took this thinking to the extreme and developed the F-117 Nighthawk stealth fighter, which revolutionized air warfare. Instead of meeting existing needs, they started with the premise that technology should enable something entirely new, even seemingly impossible.
With the aid of computer-aided design and novel materials, they engineered stealth technology, rendering the F-117 Nighthawk virtually undetectable by radar. Unit founder Kelly Johnson reportedly said, "If you ask for permission to do something new, the answer is always no." Rather than waiting for customer requirements, the unit developed technologies that exceeded all existing expectations. In doing so, the technologies they developed set new standards, becoming the requirements themselves.
Fortune Favors the Bold
Shifting to technology-driven thinking requires a fundamental shift in how business-oriented organizations operate. Simply monitoring technologies isn't sufficient; active research and bold experimentation are essential. It's a leap into the unknown.
The defense industry's approach exemplifies this shift, starting with continuous technology horizon scanning. Here, emerging technologies are systematically reviewed and their capabilities evaluated, not based on current business needs, but purely on performance and potential.
However, observation alone won't suffice. Lockheed Martin's Skunk Works has shown that genuine understanding and leadership emerge through experimentation. This often involves an uncomfortable plunge into uncharted territories. If you merely follow the industry's best (and safest) practices, you position yourself as a follower, not a leader.
Such experiments demand resources and time without the immediate pressure for returns - a challenge in our quarterly-focused economy. Yet, this freedom is what breeds the most significant breakthroughs. What a deliciously awkward paradox!
Consider Amazon Web Services or SpaceX's reusable rockets. In both cases, the market didn't request these solutions; they were born from the vision of what technology could make possible.
Far too many organizations remain entrenched in their Excel spreadsheets, insulated from the winds of change. But true disruption doesn't arise from tweaking the existing; it comes from creating something entirely new. If you're not prepared to challenge traditional business-driven thinking and step more firmly into technology's path, someone else will.
We're in an era of massive transformation. I would courage businesses to let the technology take the lead, and business benefits will follow.