In a tight budget climate, the Department of Homeland Security is working hard to get the most out of its relationship with the private sector. But unlike the early, post-9/11 days of the department, when the federal government’s security strategy was to throw billions of dollars at sometimes speculative intragovernmental and private sector solutions, DHS is now taking a more strategic approach.
A key architect of that approach is Tom Cellucci, the chief commercialization officer at DHS, as well as its acting director for the new research and development partnerships group within the agency’s science and technology directorate. Cellucci, a successful entrepreneur who holds a doctorate in physics as well as an MBA, arrived at DHS three years ago with a mission to help the department work better with the private sector to develop tools to keep America safe.
Part of that approach has been to shake up the department’s science and technology directorate, the primary division responsible for researching, developing, testing and procuring security technology for homeland defense. In a wide-ranging interview with Innovation at the DHS headquarters in Washington, Cellucci explained that a major thrust of his focus is simply letting the private sector know what the department needs.
“The private sector is ready, willing and able to help us if we give them two things—and neither of them are money,” Cellucci said. “We need to articulate in detail what our operational requirements are. Who is going to use it? How are they going to use it? And we need to give them detail—what is the temperature range for this device?”
To that end, DHS has launched a pilot program called SECURE. Under the program, companies that produce technologies the department needs can get them certified as officially sanctioned products of the department. The program calls for DHS to work with the private sector to develop products, systems or services aligned to the needs of its different offices (Customs, Secret Service, etc.), first responders and critical infrastructure and resource owners. In many cases, these represent potentially significant market opportunities, but getting SECURE certified doesn’t guarantee a DHS contract. What it does guarantee is the credibility associated with a product or service endorsement from the Department of Homeland Security. The catch is that DHS provides no money to the company seeking certification.
“We provide the private sector with our needs and it uses its own resources and creativity to come back to us with certain solutions,” Cellucci said. “We don’t guarantee anything. It’s not procurement. We just certify it—and then the company gets to share the imprimatur of DHS.”
Cellucci said the private sector has responded enthusiastically to the 18 month-old program. About 80 companies are currently vying to achieve SECURE certification. The first to do so—Visual Defence USA, a company based in Canada that manufactures forensic cameras in Buffalo—will receive its SECURE certification in March. DHS has estimated that more than 1.5 million units could be sold for use in mass transit buses, trolley cars, light, commuter and heavy rail cars and police cars.
“When we first put it out (the request for the technology) we said one of the requirements was that it had to be $200 or less,” Cellucci recalled with a laugh. “People said, ‘No way!’ But we had three prototypes in three months.”
Cellucci said American ingenuity never ceases to amaze him. “We’re not laying out a big fat government check and saying do the R&D—that could take eight years to come to fruition,” he said. “But when they’re using their own money or R&D and they know exactly what it is they’re targeting to complete, it’s amazing how fast they produce. Not only because it’s their money and their time, but because they also see the market potential.” The private sector is excited about the program because for a long time, DHS simply didn’t do a good job of telling tech companies and scientists and entrepreneurs what it needed.
“It’s going better than we had hoped because we’re now talking in a language they understand,” Cellucci said. “DHS is a young organization and being young we’ve got a lot of growing pains. There were lots of cases where we didn’t have the full detailed requirements done up front, in terms of articulating our problems and who are the users for our potential solutions.”
To help companies understand its requirements for certification, DHS has created a “Product Realization Guide” that includes nine different levels of product readiness. The first includes such basics checkpoints such as “have you done a market survey? Or “have you identified an actual need within DHS?” The sixth level—the lowest level needed to attain certification status—contains questions such as whether the product has undergone a federal environmental impact assessment or been successfully tested by the DHS.
“It’s the sweet spot where enough has been done that we have enough confidence to say it’s worth the risk to look at as part of an acquisition program—it’s got real merit,” Cellucci said. He said certification in many cases is worth the effort to a company, even if they never receive a DHS contract.
“We’re not giving it to them on a silver platter; we’re giving it to them on a golden platter,” Cellucci said. “Here’s what we need—this is not a procurement activity, we’re not guaranteeing anything, but if you do it we are certifying it. It becomes a sales differentiator for them. The private sector is not just a good partner, it is an excellent partner but you’ve got to give it the information to do a business case analysis to determine if it’s worth it to provide their time and resources to get that seal. It means something.”
Cellucci said the reorganization of the science and technology directorate at DHS has been rewarding because it’s making the department more efficient. Part of why Cellucci agreed to join DHS is because it was still a work in progress.
“Having been a CEO most of my career, I knew that when you took 22 disparate organizations and put them together there is no predictable result,” Cellucci said, referring to the department’s initial organization to include the Customs, Transportation Security Administration, Secret Service, Border Enforcement and other agencies.
“This was a perfect testing ground for these new kinds of models and theories,” he said. “My experience is that current leaders have all been very supportive of what I’m doing.”
Cellucci said he envisions DHS forging a government-wide leadership role in commercialization and technology transfer—an effort that has always been challenging and not always successful at other agencies, such as the departments of energy or commerce.
“I’d like to see DHS become a leader in some of this,” he said. “The department has really created an environment to let us try things because it makes sense. It is certainly useful to the taxpayer. We really are reducing the amount of money we need to spend and at the same time increasing the speed of execution.”
Despite all of the gloomy forecasts about American competitiveness, Cellucci said he gets an almost daily dose optimism daily thanks to the work of America’s private sector, research universities and national laboratories.
“The United States is still the leader in invention,” he said. “Our universities are the best. Countries all over the world send their top people to come here. The problem is in the innovation—the commercialization of it. We’re losing the innovation of commercialization. It’s about taking this technology and making it a worthwhile product or service in real-world applications.”
Cellucci said as federal budgets continue to feel strain from the moribund economy, programs such as SECURE will begin to make more sense. Instead of government simply doling out huge sums of cash to contractors, it can offer staff resources and detailed specifications to help enable the private sector to make more intelligent decisions while making their own investments in R&D programs.
“People find that it’s a win for the taxpayers, it’s a win for the private sector and it’s a win for the public sector,”he said. “It’s a tough climate so I think you’re going to see more and more about innovation and public-private partnerships.”
Tthe department is trying hard to inform theprivate sector of its “one hundred or so high priority needs,” including cybersecurity, aviation security and explosive device detection.
“We give them a guide,” he said. “We really do try to make it easy and keep it simple. We want to get high impact products and services certified. Private sector entities possessing technologies or products aligned to these requirements can use this valuable information to generate a business case and develop (at their cost) a fully deployable product or service after their verification of market potential.”
Tom Michael is Innovation’s Washington bureau chief.