From the Michigan Defense Center Executive Director:

About 6 years ago, as Michigan businesses faced a crushing recession, many companies who had previously enjoyed a lucrative and fairly stable relationship with the automotive sector began to look outside of that market at opportunities with crossover potential.  Many wisely turned to the Department of Defense and government contracting. In Michigan, these two economic sectors are closely related sharing a talented and skilled workforce, engineering prowess and cutting-edge technologies.  With two wars raging and a flailing automotive industry, this expansion of portfolios stabilized those companies with the foresight to branch out.

Today, with the wars winding down and proposed cut-backs to defense spending, some are deciding to ignore government contracting or delay a move into the field.  At the Michigan Defense Center, we encourage you to continue to stay connected and look to the possibilities.

It is true that tactical wheeled vehicles and ground systems are experiencing a downturn.  You can see in the one page industry overview (full image below) developed by the Michigan Defense Center that there have been some downward trends from the 2008 highs.  However, DoD contracts being awarded to Michigan companies are still higher than pre-war figures and historic spending rates in Michigan.  There are still large amounts of funding allocated to the maintenance and retooling of the ground fleet and, there are bright spots and NEW opportunities for Michigan’s wide range of technology and advanced manufacturing capabilities.

In the FY 14 Department of Defense budget, leaders requested additional funds for cyber security and information technologies (IT). “Critical investments include cyberspace operations ($4.7 billion), space capabilities ($10.1 billion), and new technology in intelligence, surveillance, and reconnaissance assets ($2.5 billion).” Secretary Hagel’s Proposed FY15 budgets reflect this same growing priority.

In a speech last May, Ashton Carter, Deputy Secretary of Defense, acknowledged this issue, “We are increasing our investments in cyber, in recognition of the growing threat that cyber poses to our national security and critical infrastructure, and are concentrating on our space and counter-space capabilities.”

From Estonia to Huntsville, nuclear facilities to financial institutions, important cyberspace is being targeted by hackers.  The Department of Defense, Department of Homeland Security and State of Michigan all recognize the importance of protecting cyber infrastructure. To counter the cyber threats our nation’s assets face, they’ve called upon IT and cyber specialists to engage with the government to come up with applicable solutions, and the dollars have followed.

Here in Michigan, Governor Snyder hosted a “Cyber Summit” last October where he joined other leaders in the state’s ongoing cyber initiative aimed at defending Michigan against cyber attacks and positioning the state to take advantage of opportunities in the growing cyber security industry.

Just this past month, on March 25th, Michigan’s Governor Snyder and State leadership cut the ribbon in Battle Creek on the new Michigan Cyber Range, the first unclassified cyber training installation located at a military facility. The new Michigan Cyber Range is located at the 110th Airlift Wing National Guard Base and is the first of its kind in the United States.

At the ceremony, Governor Snyder cited the critical importance of being prepared for a cyber attack before it happens. “Most people won`t recognize the value of what`s being done today.

It is not a crisis yet,” said Snyder. “Let`s not be on the defensive. Let`s make sure we have that defense in place when it`s needed.”Recently, Michigan Defense Center leadership had the opportunity to meet with Ms. Teresa Takai, Chief Information Officer for the Department of Defense in her office at the Pentagon. The objective was to learn about future contracting opportunities for Michigan companies with the DoD in the areas of information, communication and cyber security applications. In this issue of the Michigan Defense Center Arsenal of Innovation News, you will read a follow-up interview from this meeting.

Other articles in this edition which we have dedicated to new horizons, specifically Cyber Security, Communications and IT, should help you get a bigger picture of the market trends and opportunities for expansion.

The Michigan Defense Center and their resident Cyber/DHS sector expert have gathered information to assist in understanding this field.  To connect for success, contact the Michigan Defense Center at www.michigandefensecenter.org.

Sean Carlson
Executive Director
Michigan Defense Center
VP Federal Procurement, MEDC

(To Download Image, simply drag the image below to your desktop)