Balancing switching costs and opportunity costs: Market-based architectures for defense acquisition

Cyber warriors defend the network at the tactical operations center for 2nd Armored Brigade Combat Team, 1st Armored Division, on Fort Bliss, Texas, during Network Integration Evaluation 16.1, which ran from Sept. 25 to Oct. 8, 2015. (Photo by David Vergun/Defense Media Activity - Army Productions)

By Marin Halper and Glenn Daly • Apr 16, 2025

Future systems must be designed for continuous modification—emphasizing speed, modularity, and open interfaces for seamless technology upgrading and integration. DoD must adopt new architectural principles that balance adaptability, interoperability, and mission effectiveness, including:

Open access to federated data to foster competition based on capability rather than exclusive access to government-owned data
Defining modular boundaries to align mission outcomes with market dynamics
Prioritizing Measures of Effectiveness (MOE) over Measures of Performance, to balance immediate needs with long-term adaptability
Balancing intellectual property rights and sourcing flexibility, while leveraging MOEs in decision-making

This strategy will equip warfighters with best-in-class capabilities — now and into the future — while maintaining the agility to pivot as challenges and technologies evolve.