Anti-Hours Win Wars

The Brave New World

In his recent 90-minute speech, Secretary of War Pete Hegseth declared war on the acquisition bureaucracy.  The newly released Acquisition Transformation Strategy outlines the shift. This new strategy is truly sweeping; it fundamentally rewrites how the Department of Defense buys, builds, and fields capability. He told the large prime contractors to “adapt or fade away.” That’s more threat than advice. This isn’t incremental reform; it’s a full reset.

It comes at a moment when capability no longer moves on multi-year timelines. As systems become software-defined, advantage increasingly comes from how quickly organizations can learn, adapt, and evolve – often well before conflict ever begins.

From my perspective, the biggest change is the acquisition model: replace stodgy, compliance-based, cost-plus contracts with agile commercial purchasing. This changes the business model from “charging for hours” to charging for value delivered.

I like the way that sounds. As a software vendor that sells into both defense and commercial markets, this makes sense. Commercial markets are far more efficient consumers of supplier value. Why? Because commercial markets reward anti-hours.

The Value of Anti-Hours

Consider RTI. We provide the core nervous system software that enables intelligence in real-world systems like cars, medical imaging systems, and military equipment. These are all smart machines, and there are many of them. Our software is in thousands of designs, including over 500 military programs of record ranging from Navy ships to air defense. 

Since every smart machine needs a nervous system, every project needs to either build one themselves or buy software from a vendor like RTI. This is a classic “build vs buy” decision. 

On the build side of the decision: if you’re a contractor with a “cost-plus” contract, you charge for every hour you spend (“cost”), and make profit on every one of those hours (“plus”). So, at some level, contractors that bill by the hour are financially motivated to make the choice that uses the most hours: build. At least in theory, cost-plus contracting actively encourages inefficiency. 

On the buy side: commercial off the shelf (COTS) components compress schedules by reusing the core engineering and validation work. In a very real way, COTS products provide anti-hours, they reduce the number of hours you need to develop your system. It’s much more efficient. 

For a cost-plus contractor, choosing to buy rather than build is a fundamental conflict: reducing the hours they charge reduces their revenue. Of course their customer (the government) sees this differently. Sometimes, defense systems are so unique that they warrant a custom solution. A COTS product rarely exactly fits the problem like a bespoke development. But in many cases, it’s like paying every contractor to build its own cell phone, database program, or streaming service. If you need one of these in your system, it’s far better to design around the COTS product.

Building your own is obviously absurd for cell phones and databases. But the only reason it's absurd is because these technologies, like millions of commercial products, evolved in environments that reward efficiency and value. Commercial business models reward anti-hours. 

Efficiency isn’t the only reason. Commercial markets also optimize fast delivery. They reward generic products that can be reused in many applications. They favor companies that build reputations for quality, reliability, and functionality. In other words, like the new DoD mantra, commercial markets and business models drive speed, accountability, and trust. Anti-hours are really valuable.

A Commercial Mindset for National Defense

As a Silicon Valley native (I did a PhD in robotics at Stanford), I’ve watched how technologies evolve across industries. Virtually every technology starts out as a defense technology, including radio, computing, and the internet. Over time, commercial applications apply the new technology to consumer problems, driving costs down and value up. Smart defense systems then adopt the lessons learned by these applications and continue to push the edge in new directions. In other words, Silicon Valley is a great petri dish for Pentagon technology. 

However, as Secretary Hegseth points out, somewhere along the way the defense industry drifted. Covering development cost is the only way to fund rare “exquisite” systems. But covering costs leads to layer upon layer of bureaucracy. Designs need detailed requirement specifications. Formal bid competitions control every step. Entire quality and testing organizations ensure function. Contract auditors force justification for every hour spent. And on and on. Somewhere in this process, reuse became optional, component vendors became rare, and reinvention for every contract became routine.

Efficiency has always been a government goal. But for the first time, the acquisition reform fully embraces COTS. Done well, this is not a small change. It’s a new mindset that can drive a new commercial defense market.

And that mindset matters. RTI has extensive experience in commercial markets; a commercial mindset for defense has exciting potential. Industries from healthcare to automotive move faster and learn continuously through agile iteration, modular design, and open architectures. Notably, while they do have standards to follow, none of these commercial industries suffers the inefficiencies above. Requirements follow market demand. Competitive bids are open, and the winners based on product function and quality. Commercial customers audit suppliers for delivery and quality, not abuse. Defense is finally adopting that same playbook – and it couldn’t come at a more critical time.

Combining Architecture and Business Models

RTI is an architectural leader in both defense and commercial markets. We partner with our defense customers by supporting standards-based architectures and consortia, including Modular Open System Approach (MOSA). Commercial industries are not as dedicated to standards, but it's a mistake to assume that commercial industries care less about modularity than defense. In all industries, transparent, open, well-defined interfaces are the key that unlocks efficient software development. This is the reason that all these industries rely extensively on the DDS standard; its main benefit is in carefully defining when exactly what information flows between which modules. Those three aspects – when, what, and who – are the critical base of modular software. And modular software is the key to building software quickly, iterating on designs, lowering maintenance costs, and delivering quality results. 

The most exciting part of the new acquisition strategy is the potential to converge both the architecture and business models of the defense and commercial worlds. Silicon Valley is well known for innovative technology, intensely-competitive companies, and fast delivery. Today’s defense industry is not, but it is known for reliable operation in any environment. The challenges we face today – autonomy, AI integration, distributed operations – demand the best of both worlds. The private sector has the speed and creativity. The defense sector has the rigor and responsibility. The future of our national defense depends on how well we combine them. 

So, we need both modularity and anti-hours. Modular architecture provides better software faster, anti-hour commercial models financially reward that success. Together, they provide the technical evolution speed that builds capability well before a conflict – and wins wars if we get into a conflict. Fixing our clunky acquisition process could really speed innovation.

Modularity enables speed. 

Anti-hours push speed.

And speed wins wars.

About the author:

Stan Schneider is CEO of Real-Time Innovations (RTI), the largest software framework provider for smart machine and real-world systems. 

Stan also serves on the advisory board for IoT Solutions World Congress and the boards of the Teleoperations Consortium and the Autonomous Vehicle Computing Consortium (AVCC). Stan holds a PhD in EE/CS from Stanford University.