1. Office of Small Business Programs for the Department of Defense
Victor Ciardello
Director, Small Business Technology and Industrial Base
The Society of American Military Engineers
Washington DC Post
2007 Small Business Conference
October 18, 2007

2. DoD Office of Small Business Programs
DoD FY2006 Small Business Performance
The Need for Small Business
Mentor-Protégé Program
Small Business Innovation Research Program/ Small Business Technology Transfer Program
MENTOR-PROTEGE
FY2008 MPP Conference – March 10–13, 2008, Hilton Daytona Beach — Daytona Beach, FL
Nunn-Perry Awards – Nomination packages will go out next month (September 2007)
Funding Issues – $20 Million for FY2008 with a likely further reduction of $2 M as a A&T withold. Mr. Victor Ciardello the MP Program Manager at OSD is very serious about canceling active agreements when non-spending (or not invoicing) indicates that funds are not needed.
SDVOSB
SDVOSB Awards November 5th Pentagon Conference Center
Through the presentation of the inaugural Service-Disabled Veteran-Owned Small Business Awards, the Department of Defense (DoD) seeks to recognize outstanding performance by SDVOSB firms.
Award Criteria:
The criteria to receive an award include: Innovative Technologies for the Warfighter; Impact on the Veteran & Service-Disabled Veteran Community; and Growth of the SDVOSB. Detailed descriptions of these criteria and relative weighting of each are stated in the Nomination Package Template available on our website:
Eligibility Requirements for the 2007 (FY06) Award:
Any certified Service-Disabled Veteran-Owned Small Business that:
worked under a Department of Defense contract or subcontract during any portion of FY 2006 (Oct. 1, 2005 through Sept. 30, 2006).
submits a nomination on time and in accordance with all directions in the Call for Nominations.
is currently not on the listing of contractors debarred, suspended, proposed for debarment, and declared ineligible under FAR 9.4.
Nomination Procedures:
Nominations will be accepted from any of the following:
Service-Disabled Veteran-Owned Small Businesses
Prime Contractors with SDVOSB subcontractors
DoD Commanding Officers
DoD Program Managers
DoD Small Business Specialists or Contracting Personnel
Veteran Service Organizations

3. Department of Defense FY2006 Prime Contract Awards
Total Eligible Dollars
Small Business Dollars
Small Business Percentage
$235
$51.3
21.8%
SDB Dollars
SDB %
SDVOSB Dollars
SDVOSB %
WOSB Dollars
WOSB %
HUBZone Dollars
HUBZone %
$14.7
6.3%
$1.6
0.7%
$6.90
2.9%
$4.7
2.0%
$ =Billion
*Source SBA Goaling Report

4. Department of Defense FY2006 Subcontract Awards
Total Eligible Dollars
Small Business Dollars
Small Business Percentage
$106.6
$39.6
37.20%
SDB Dollars
SDB %
SDVOSB Dollars
SDVOSB %
WOSB Dollars
WOSB %
HUBZone Dollars
HUBZone %
$5.1
4.80%
$0.7
0.70%
$5.80
5.50%
$1.8
1.70%
*Source SBA Goaling Report
$ =Billion

5. DoD Office of Small Business Programs
DoD FY2006 Small Business Performance
The Need for Small Business
Mentor-Protégé Program
Small Business Innovation Research Program/ Small Business Technology Transfer Program
MENTOR-PROTEGE
FY2008 MPP Conference – March 10–13, 2008, Hilton Daytona Beach — Daytona Beach, FL
Nunn-Perry Awards – Nomination packages will go out next month (September 2007)
Funding Issues – $20 Million for FY2008 with a likely further reduction of $2 M as a A&T withold. Mr. Victor Ciardello the MP Program Manager at OSD is very serious about canceling active agreements when non-spending (or not invoicing) indicates that funds are not needed.
SDVOSB
SDVOSB Awards November 5th Pentagon Conference Center
Through the presentation of the inaugural Service-Disabled Veteran-Owned Small Business Awards, the Department of Defense (DoD) seeks to recognize outstanding performance by SDVOSB firms.
Award Criteria:
The criteria to receive an award include: Innovative Technologies for the Warfighter; Impact on the Veteran & Service-Disabled Veteran Community; and Growth of the SDVOSB. Detailed descriptions of these criteria and relative weighting of each are stated in the Nomination Package Template available on our website:
Eligibility Requirements for the 2007 (FY06) Award:
Any certified Service-Disabled Veteran-Owned Small Business that:
worked under a Department of Defense contract or subcontract during any portion of FY 2006 (Oct. 1, 2005 through Sept. 30, 2006).
submits a nomination on time and in accordance with all directions in the Call for Nominations.
is currently not on the listing of contractors debarred, suspended, proposed for debarment, and declared ineligible under FAR 9.4.
Nomination Procedures:
Nominations will be accepted from any of the following:
Service-Disabled Veteran-Owned Small Businesses
Prime Contractors with SDVOSB subcontractors
DoD Commanding Officers
DoD Program Managers
DoD Small Business Specialists or Contracting Personnel
Veteran Service Organizations

6. Need for speed & flexibility to address emerging and evolving threats
The Need for Small Business Imperatives demand technology… Challenges make it harder to get
Need for speed & flexibility to address emerging and evolving threats
Consolidating industrial base
Budget pressures
Less R&D investment in industry
Increasing emphasis on/need for joint capability acquisition
Several “forces” contribute to making the current defense environment difficult relative to meeting future research, development and acquisition needs, particularly vis-à-vis technology innovation: industry structure, human capital “crisis,” rapidly evolving threats, budget pressures on several levels, declining industry aggregate investment in R&D, and an increasing need for joint (vs. service-specific) acquisition solutions.
The Central Challenge: Where will innovation come from and how will we get it?

7. Over Two Decades of Consolidation:
What were over 100 “name plate” primes in the1980s are now five firms…
Lockheed
Martin
Martin Marietta Corp.
Space Systems Division (General Dynamics)
GE Aerospace
Loral Corp.
IBM Federal Systems
Unisys Corp Defense Systems
Honeywell-Electro-Optics
Fairchild Weston Systems Inc.
Ford Aerospace
Librascope
LTV–Missile Business
General Dynamics–Ft. Worth
MEL
COMSAT Corp.
OAO Corp.
Affiliated Computer Services, Inc. (ACS)
The SYTEX Group, Inc.
STASYS Ltd. (UK)
Sippican Holdings, Inc.
Northrop
Grumman
LTV–Aircraft Operations
General Dynamics Space Business
Westinghouse El. Defense
Syscon Corp.
Logicon, Inc.
Applied Technology Associates
Geodynamics Corp.
Ryan Aeronautical
Kistler Aerospace Corp.
Alvis Logistics–EDD Business
Inter-National Research Institute (INRI)
Teledyne Ryan Aeronautical
DPC Technologies, Inc.
Comptek Research, Inc.
Federal Sys Grp (Sterling Software, Inc.)
Federal Data Corp.
NYMA, Inc.
Sylvest Management Systems Corp.
Tisoft, Inc.
Technical and Management Assistance, Inc.
R.O.W. Sciences, Inc.
Telos Corp.
Taratin
PRC (Black & Decker)
General Instruments–Defense
Varian–Solid State Devices
Litton Industries
Avandale Industries
Newport News Shipbuilding
TRW
BDM International Inc.
XonTech, Inc.
TASC (Primark)
General Dynamics
General
Dynamics
Bath Iron Works
Lockheed Martin Defense Sys, Armament Sys
Lucent Advanced Technology Systems
Computing Devices International, Inc
NASSCO Holdings, Inc.
Gulfstream Aerospace
GTE Government Systems Corp. Units
Santa Barbara
Primex Technologies
Galaxy Aerospace
Motorola Integrated Info Sys
GM Defense
SIGNAL Corp.
Trident Data Systems
MRJ Technology Solutions
Pacific-Sierra Research Corp.
DatumCom Corp.
Veridian Corp.
Digital System Resources, Inc.
ERIM International, Inc.
Spectrum Astro, Inc.
Tripoint Global Communications, Inc.
Engineering Technology, Inc.
Over the past 25 years, the defense industry (at the prime level) has become increasingly consolidated. What were well over 100 “name-plate” defense firms in the 1980’s are now part of our “big five” prime contractors of today: Boeing, Lockheed Martin, General Dynamics, Raytheon and Northrop Grumman. This industrial structure impacts competition which in turn can have impacts on pricing, quality, barriers to entry and, not least, innovation.
Source: Center for Strategic and International Studies (CSIS)
Raytheon
REMCO SA
Hughes Electronics
BET PLC's Rediffusion Simulation
General Dynamics Missile Division
Magnavox
STC PLC–Navigation Systems
TRW-LSI Products Inc.
Corporate Jets
E-Systems
HRB Systems Inc.
Chrysler Techn. Airborne
Texas Instr. El. Defense
Allied Signal, Inc. (Comm Systems)
Aerospace Group (Australia)
Boeing Australia Ltd.
JPS Communications, Inc.
Solipsys
Honeywell International Corp. (Australia)
Photon Research Associates, Inc.
Boeing
Boeing Co.
Rockwell
Litton Precision Gear
McDonnell Douglas
Hughes Electronics Satellite
SVS, Inc.
Autometric, Inc.
Continental Graphics Corp.
Jeppesen Sanderson, Inc.
Hawker de Havilland Ltd. (Australia)
Conquest, Inc.
Frontier Systems, Inc.
1990
1991
1993
1992
1995
1996
1997
1998
1994
2004
2003
2002
2001
2000
1999
2005
2006
Sources: DM&A, Washington Technology, Company reports, and CSIS Analysis.
Federal Services
Defense Hardware
Commercial IT
Chart supplied by the Center for Strategic & International Studies (CSIS)

8. DoD Functional Capability Areas
Deployment
Distribution
Sustain
Medical
Mobility
Logistics C2
All source intelligence
Environmental Data
Own Force Info
Predictive Analysis
Knowledge Management
F-22/35
sensors
AESA
ATIRCM/ CMWS
Global Hawk
AWACS
sensors
JSTARS
sensors
E2C Reproduction
Battlespace
Awareness
MC2A
sensors
SBIRS
High/Low
NPOESS
= Army
= Navy
= Air Force
= DoD
Key:
SM 2
MP RTIP
sensors
JSIMS
PAC-3
MMA
sensors
Longbow
radar
LPD 17
Personnel &
Infrastructure
Protection
(OPSEC -
missile defense,
electronic protection)
Computer Network
Defense
Counter and Non-
Proliferation
Consequence
Management
C-17
Warrior
Land
MTHEL
JLENS
GPS
CV-22
Protection
AAAV
MH60-R/S
Chem
Demil
Focused
Logistics
THAAD
BMDS
NTW
GCSS
MV-22
SBL
ATIRCM
CH-47F
FMTV
Land, Maritime, Air,
Space Operation
Joint Targeting
Conventional,
nuclear,
computer network,
electronic attack
Psychological
Special Ops
SEAD
Military Deception
MPF(F)
MEADS
LHA
ABL
EELV
T-AOE(X)
C-130
MIDS-LVT
NAS
F-35
C-5
MC2A (C4)
Adv EHF
Bradley
Upgrade
Stryker
CSAR
Command &
Control
GBS
Force
Application
AIM-9X
LCS
MMA (C4)
SDB
F-18
AMRAAM
AWACS (C4)
Javelin
F-22
JBMC2
Communications
& Computer
Environment
MUOS
FCS
DDG-51
CEC
JTRS
Excalibur
WIN-T
FCS
(C4ISR)
Comanche
JDAM
Tomahawk

9. Warfighting Capabilities, Technologies, and Industrial Capabilities: The Increasing Need for Small Businesses
Functional Capability
# Warfighting Capabilities
# Technologies
Priority Critical Technologies and Components Assessed
Battlespace Awareness
357
270 72
Command & Control
189
293 58
Force Application
787
212 61
Protection
440
277 64
Focused Logistics
271
364
Total
2,044
1,416
313
For the industrial capabilities assessed, ~36% of the companies with relevant products have less than 100 employees.
Source: Booz Allen Hamilton and ODUSD(IP)

11. The Mentor-Protégé Pilot Program was established on November 5, 1990 (Public Law ) in an effort to respond to concerns, raised by DoD prime contractors, that many SDBs did not possess the technical capabilities to perform DoD subcontract requirements, making it difficult for these prime contractors to achieve their SDB subcontracting goals.

12. National Defense Authorization 2005 Changes to Public Law 106-65, Subtitle D,
Section 841
New agreements through Sep 30, Extend participation through Sep 30, 2013
Section 842
Protégé eligibility extended to:
Service-Disabled Veterans (SDVOSB)
Qualified HUBZone small businesses

13. Mentor-Protégé Program Eligibility
A Qualifying Mentor must be:
Performing under at least one active approved subcontracting plan negotiated with the DoD or another Federal agency
be eligible for award of Federal contracts
A Qualifying Protégé must be one of the following:
A Small Disadvantaged Business (SDB) concern certified by SBA, or
A qualified organization employing the severely disabled, or
A Woman-Owned Small Business (WOSB)
A Service-Disabled Veteran-Owned Small Business (SDVOSB)
A Qualified HUBZone Small Business Concern

14. MPP Funding FY1992 – FY2007
Millions

15. Type of MPP Agreements Direct Reimbursed MP Agreements
Direct Reimbursement of cost of developmental assistance:
Identify Specific Contract Vehicle/Contracting Officer Endorsement
Minimum of 50% Technical Transfer
Required use of an HBCU/MI/SBDC/PTAC
Direct cost reimbursement of allowable costs outlined in Appendix I, including:
Direct labor costs (for assistance by Mentor firm employees)
Assistance provided by HBCUs/MIs/SBDCs/PTACs
Other costs
Detailed Cost Breakdown
Military Services/Other Defense Agencies may have additional requirements
Military Services/Other Defense Agencies Approval

16. Type of Agreements Credit MP Agreements
Credit toward SDB subcontracting goals:
No Military Service or Other Defense Agency approval required
More focused on business infrastructure/business development
Costs incurred under Credit Agreement
May be applied (in the following multiples) towards the SDB subcontracting goal under any Federal Agency Subcontracting plan: (FAR )
4x for assistance provided by HBCUs/MIs/SBDCs/PTACs
3x for assistance by Mentor firm employees
2x other costs

17. Mentor-Protégé Program Types of Developmental Assistance
Technical Transfer, including CMMI, ISO9000 or Six Sigma Certifications
Business Infrastructure Development
Award of subcontracts under DoD contracts on a non-competitive basis
Progress payments (up to 100%)
Advance payments
Loans
Investments in the protégé firm that have a need in exchange for ownership interest (10% or less)

18. 153 Current Active Mentor-Protégé Agreements
94 Reimbursable Agreements
59 Credit Agreements
NUMBER OF MENTOR-PROTÉGÉ AGREEMENTS

19. Participation by State – FY07
Mentor and Protégé Participants WA
P-7
M-2 ME MT
P-3 ND
P-1 VT MN
P-1 NY
P-1
M-1 NH OR SD
P-3 WI
P-1 MI
P-2
M-1 AK
P-5
RI M-1
CT P-3, M-5 ID WY
MA P-3, M-3 PA
P-6 IA OH
P-2
M-1 NE
P-1
M-1
NE P-2 M-1
NJ P-4, M-3 NV
P-1 IL
P-5
M-4 IN
M-2
MD P-13, M-5 UT
P-2
M-1 IN WV
P-2 CO
P-5
M-4 WV VA
P-28, M-21 KS
P-2
M-1 MO
P-3
M-2
DC P-5, M-1 CA
P-34
M-7 KY NC
P-4 NC
TN P-5, M-1 AZ
P-4
M-2 OK
P-2 AR NM
P-2
M-1 AR
SC P-2 M-1 AL
P-14
M-8 GA
P-2
M-1 MS TX
P-10
M-6 LA
P-1
M-1 HI
P-2
FL P-14 M-3
Has Participants
No Participants
P Protégé Participants
M Mentor Participants

20. Mentor-Protégé Program Participation by Eligibility 1991-2006

21. Protégé Industry Sector FY 2007

22. Mentor-Protégé Robotics Initiative
Active Robotics Protégés
AnthroTronix
Epsilon *
Geodetics *
Kuchera Defense
RE2
Stratom
Sullivan
Mesa Robotics
Referentia
Lorimar Group, Inc.
Potential Robotics Protégés
Holman Industries
Defense Technology Solutions, LLC
Photon-X
Shee Atika Technologies LLC
Digital Artefacts

23. Service-Disabled Veteran-Owned & Veteran Owned Protégés
16 firms entered Program as SDVOSB Protégés:
Alliance of Architects and Engineers
Information Innovators, Inc.
Stratom, Inc.
Brigadier Construction Services, LLC
Maintenance Inspection Services (MIS)
Tompco, Inc.
Chequamegon Bay Engineering, LLC
Oak Grove Technologies
Veterans Construction Inc.
Damar Machine Company
QTechnology International, Inc.
Washington Square Associates, Inc.
Defense Manufacturing & Supply (DMS)
Regulus Corporation
EnVetCo
Sonju Industrial
In addition there are:
7 additional SDVOSBs Protégés that entered the Program as an SDB
35 Veteran-Owned Protégés

24. Nunn Perry Protégé Awardees Revenue growth ($) (Cumulative)
Nunn-Perry Award Year

25. Nunn Perry Protégé Awardees Employee growth (#) (Cumulative)
Nunn-Perry Award Year

30. SBIR-STTR Program Eligibility Criteria
Organized for- profit U.S. business, located in the US
At least 51% U.S.- owned by individuals and independently operated
500 or fewer employees
Principal Investigator’s primary employment with small business during project
STTR
Formal Cooperative R&D Effort (Minimum 40% by small business, 30% by U.S. research institution)
U.S. Non-profit Research Institution (College or University; other R&D center)
Intellectual Property Agreement - Allocation of Rights in IP and Rights to Carry out Follow-on R&D and Commercialization
Broad purpose: Ensure small businesses receive share of federal R&D and leverage the unique innovative character of small business

31. DoD is about Half the Federal SBIR Program
Largest of 11
Participating
Federal Agencies
SBIR FY06 Budget
$1.13B
STTR FY05 Budget
$130M
DoD constitutes a majority of the Federal SBIR (and STTR) Program

32. SBIR/STTR Program Structure
SBIR/STTR Funds:
SBIR/STTR Does Not Fund:
Phase I: Project Feasibility
Generally 6 months, not exceeding $100,000
Phase II: Project Development to Prototype
Generally 2 years, not exceeding $750,000
Phase III: Commercialization in Military and/or Private Sector
Sale of product or service
Additional R&D of technology
Manufacturing/production start-up
Marketing start-up/marketing
Training workforce to manufacture or sell new products
SBIR’s three phase structure:
- Phase I: 6-month, $100K technical merit/feasibility
- Phase II: 2-yr, $750K prototype demo
- Phase III: further investment & sales to bring product to market
The simple structure makes the process of scientific discovery and technology development appear quite linear, but it usually is not. Rather, innovation tends to advance on a nonlinear path.
The result is often a technology “valley of death” between phases II and III, where numerous technologies require further (non-SBIR/STTR) funding for development, test, evaluation and eventual procurement.

33. Focus of SBIR Investments
Key Technology Areas:
Focus of SBIR Investments
Number of Topics
Please update for FY02-FY06 - Done
Source: SBIR & STTR solicitations, FY02-FY06

34. DoD Office of Small Business Programs DoD Mentor-Protégé Program
(703)
DoD Mentor-Protégé Program