Feral Jundi

Tuesday, April 13, 2010

Strategy: Smart Power And The Defense Industry

   Boy, this is a long one and this will take you a little bit to read through all the speeches and various articles.  But hey, if you are a student of strategy and are wanting to take a look into the future of defense contracting, you have to figure out what the big boys are thinking and wanting to do.

   What is interesting about ‘Smart Power’, is that it is a concept that gained it’s start as a political buzz word to differentiate one party’s views on foreign policy versus another’s. Which is standard play in the world of politics. Although I would argue that every administration no matter what party, all strive to use smart power in their foreign policy strategies. But hey, I will let the political pundits play that game–I have more important things to talk about.

   With that said, with a new administration comes newly minted foreign policy goals. Smart power is the flag pole that they are rallying around and that is what we all must focus on in order to stay current.

   There are a number of places to research the definition and origins of the concept of smart power.  For this post, I wanted to stick with Matt Armstrong’s definition of smart power because his pays respect to the original strategists who promoted such concepts back in their day.  He built a ‘snow mobile’ out of it, and brought in Sun Tzu and Clausewitz to create four pieces to the definition.(see below)

   Now that we have perspective and reference for smart power, my intention in this post was to highlight what the defense industry thinks about smart power.  Just look at the latest moves of Cerberus, and you will see how important this smart power concept is.  DynCorp, along with other defense companies involved with contracting, are all trying to adapt to the goals of a new administration and their ‘smart power’ focus, and investors are taking notice.  So what does all this mean for security contractors like you and me?

   Training, training, and more training is going to be the wave of the smart power future.  In order to stop a state from failing, you need to get into nation building, and the defense industry is jumping all over that.  From training police and military forces to propping up government institutions, the defense industry is all about training and mentoring. Expect to see more contracts in really bad places in the world, all with a focus on strengthening the recognized government and stabilizing that country.  Those are the places that need expertise and all the help we can give them, and private industry will answer that call.

   We also can provide other necessities of the state.  We can build defenses, enforce borders, build government facilities, create ‘Green Zones’, guard dignitaries or investors (commerce is vital to failed states as well), build infrastructure and provide the necessary support to the U.S. military and federal government as they go around the world and implement ‘smart power’. We are the SysAdmin and the ‘hold and build’ portion of today’s strategies. Security contractors are essential for all of that, whether a local national guard or it being an expat guard.  Someone has to protect these folks as they rebuild a crumbling state.

   Smart power is very friendly to private industry in another way.  Using military for everything when it comes to nation building, is not smart.  If we want to put a civilian face to our diplomacy, as opposed to a menacing military face, then smart power requirements will need civilians.  Of course there will be federal employees providing that civilian face, but that only goes so far, and federal response is no where near as fast as private industry response.  In other words, private industry equals speed, flexibility and scalability.  In a fast paced and highly dangerous world, private military companies with nation building capabilities and built in security mechanisms will be necessary to implement smart power strategies.  Just look at today’s wars and projects throughout the world, and tell me private industry doesn’t have a role in that process?  (might I note that contracting has only increased under the current admin–too bad we get zero recognition for our contribution to smart power)

   Interesting stuff, and let me know what you think. –Matt

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Smart Power is “the capacity of an actor to combine elements of hard power and soft power in ways that are mutually reinforcing such that the actor’s purposes are advanced effectively and efficiently.”  Those familiar with Sun Tzu and Clausewitz will recognize the four elements of Smart Power:

• The target over which one seeks to exercise power—its internal nature and its broader global context. Power cannot be smart if those who wield it are ignorant of these attributes of the target populations and regions.

• Self-knowledge and understanding of one’s own goals and capacities. Smart power requires the wielder to know what his or her country or community seeks, as well as its will and capacity to achieve its goals.

• The broader regional and global context within which the action will be conducted.

• The tools to be employed, as well as how and when to deploy them individually and in combination.

From the Mountain Runner blog.

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What’s “Smart Power”? DynCorp’s Tony Smeraglinolo on six best practices

April 12th, 2010

by JD Kathuria

“Smart power” — ever since Defense Secretary Robert Gates outlined the policy in a 2008 speech, it’s become the emerging tenet for how the United States should approach global security initiatives. Through a mix of military strength and nation-building activities, the aim is to keep “fractured or failed states,” as Gates put it, from teetering on the brink of war — or from requiring the US military, already stretched thin in Iraq or Afghanistan, from having to intervene further.

The urgency for smart power has only grown with the Obama administration’s call for $39.4 billion in funding for civilian foreign operations in fiscal 2011. Now comes the hard part: Determining how smart power can be implemented effectively to address global challenges.

Tony Smeraglinolo is working to cut through that uncertainty. As president of Global Stabilization and Development Solutions for DynCorp International, Smeraglinolo offers up this succinct definition: Smart power requires the application of three D’s — Defense, Diplomacy, and Development.  Since assuming his role in April 2009, Smeraglinolo has helped structure his division at DynCorp to provide all three core competencies.

(more…)

Industry Talk: Cerberus Agrees To Acquire DynCorp In $1.5 Billion Deal

   “Private-equity firms are focusing on defense service providers rather than hardware makers, making a calculation that military demand for services will hold up better than hardware in the years ahead,” Loren Thompson, a defense analyst with the Lexington Institute….

***** 

   This is a big deal.  When a company like Cerberus pulls the trigger on purchasing DynCorp, along with previous purchases of IAP Worldwide Services, Tier 1 Group and Radia Holdings, I tend to take notice.  Cerberus is reading the tea leaves of defense and positioning themselves to own the companies that will matter in the future.  To me, this signifies that defense services, as opposed to defense hardware makers, is the new ‘big sexy’ in defense.

   It also tells me that Cerberus is doing their homework.  I have never been contacted by their people, but I am sure they have been reading through all the strategy papers and forward looking stuff that is produced by all the think tanks to come to their conclusions.  Plus they have two long and expensive wars to study along with the GWOT.  They have made their determinations about the future of defense, and these chess moves say a lot.  This is a recognition of the fact that contractors are a strategic necessity for our future wars, and now investors are catching on.

   The other point on this is DynCorp’s current owner Robert McKeon (Veritas Capital) made a lot of money on this deal. Very impressive return on investment if you ask me. –Matt

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Bill Ballhaus Talks About DynCorp Acquisition

April 12th, 2010

by John Adams

Bill Ballhaus, an ExecutiveBiz 2009 Person to Watch and CEO of security giant DynCorp (NYSE: DCP) shared his thoughts on his firm being purchased by Cerberus for the cool sum of $1.5 billion.

“I believe that under this partnership with Cerberus, DynCorp International will be able to build on our extensive heritage and successful performance to continue to achieve our growth objectives.” He added, “this transaction is a major milestone for DynCorp International’s continued leadership in serving our customers and supporting U.S. national security and foreign policy objectives.”

Link to quote here.

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Cerberus Agrees to Acquire DynCorp in $1 Billion Deal

April 12, 2010

By Emily Thornton and Gopal Ratnam

April 12 (Bloomberg) — Cerberus Capital Management LP, the private-equity firm whose takeover of Chrysler Corp. ended in bankruptcy, agreed to buy defense contractor DynCorp International Inc. for about $1 billion.

Cerberus, run by Steve Feinberg, will pay $17.55 a share, Falls Church, Virginia-based DynCorp said today in a statement. The price is 49 percent more than DynCorp’s closing share price on the New York Stock Exchange on April 9. The deal, expected to close in the third or fourth quarter, is valued at $1.5 billion including the assumption of debt.

DynCorp, which helps train Iraqi police and supports the U.S.’s operation of military bases, is at least the fifth government-services investment that Cerberus has made since 2000, according to data compiled by Bloomberg. Cerberus owns government contractors including IAP Worldwide Services Inc., Tier 1 Group and Radia Holdings Inc.

“Private-equity firms are focusing on defense service providers rather than hardware makers, making a calculation that military demand for services will hold up better than hardware in the years ahead,” Loren Thompson, a defense analyst with the Lexington Institute, a public policy research group in Arlington, Virginia, said in a telephone interview.

DynCorp rose 48 percent, the most since its initial public offering four years ago, to $17.41 at 4:02 p.m. in New York Stock Exchange composite trading.

(more…)

Monday, April 12, 2010

Building Snowmobiles: Secretary Of Defense Gates Gives The ‘To Be, Or To Do’ Lecture At The AF Academy

     It strikes me that the significance of Mitchell, Arnold, Schreiver, and Boyd and their travails was not that they were always right. What strikes me is that they had the vision and insight to see that the world and technology had changed.  They understood the implications of that change, and they pressed ahead in the face of incredibly fierce institutional resistance. 

    One of the reasons they were successful at championing their ideas is that they were always willing to speak truth to power…. -Secretary Gates

*****

   This is great and totally worthy of a ‘building snowmobiles’ post.  Secretary of Defense Gates pays homage to Col. John Boyd in a big way with this lecture, and I was certainly motivated by the words.  It is a lecture that completely supports the concept of ‘to be, or to do’.  How incredibly refreshing it is to hear such words from someone at that top.

   I will shut up now, and let the reader check out this ‘truck load of awesome’. –Matt

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John Boyd

Col. John Boyd.

United States Air Force Academy Lecture

Remarks as Delivered by Secretary of Defense Robert M. Gates,

Colorado Springs, CO

Friday, April 02, 2010

*****

Thank you for that introduction.

It’s a pleasure to be back at the Air Force Academy for my first visit since 2007, when I spoke at commencement. And I’m particularly happy to be in Colorado Springs, but then I am happy to be anywhere other than Washington, D.C.

I should begin by congratulating the Class of 2013 for making it through “Recognition” and earning your props and wings. It’s a great achievement and one you should be proud of. I hope you’ve had a chance to get some well-earned freedom.

I certainly did not go through anything nearly as rigorous when I was commissioned as an Air Force officer 43 years ago. I have to admit now, though, four decades plus removed from Officer Training School at Lackland Air Force Base, Texas, I’m a little surprised that they even let me out.

Now, in a normal speech, I would thank you all for coming, but I know full well that this event is not exactly optional – so, my apologies — and I’ll be content with thanking you for just staying awake after lunch, or at least trying to, with the schedule that you all have here.

(more…)

Haiti: Security Update–Bad, To Worse

     Amnesty International documented cases of sexual violence in camps. Four of the victims interviewed were children. An 8-year-old girl called Celine (not her real name) was alone in the tent at night when she was raped. Her mother had left the camp to work and had no one to look after her daughter during her absence. A 15-year-old girl, called Fabienne (not her real name) was raped when she left the camp to urinate, as there were no latrines within the camp. Carline (not her real name), 21, was raped by 3 men when she went to urinate in a remote area of the camp, as the latrines were too dirty to be used. Pascaline (not her real name), 21, was raped and beaten in her tent, neighbors failed to intervene because they believed she was with her partner. 

*****

   What can I say?  These folks that continue to promote this idea that security is not important, or that contracting security is disaster capitalism will have the crimes and violence in Haiti all over their pen holding hands.  Shame on you. All I have to say is that you cowards have to look at yourself in the mirror every day and realize that people are suffering because of this ‘non-action’ you keep promoting.

    But it gets worse.  Now we are sending cops from one humanitarian disaster (Rwanda) to another disaster (Haiti), and somehow this gets a free pass?

    The first article below is about sending Rwandan cops to Haiti. Whose hair brained idea was this and how are these clowns going to actually increase security in Haiti?  As the first article below has clearly stated, Rwanda is the last country to get get security forces from or claim some kind of humanitarian award for excellence.

     The second article is about the $ 13.55 billion that world wide donors have raised to rebuild Haiti. Billions….  That’s nice and all, but if there is that much money floating around, why are Haitians having any issues at all regarding security?  In my view, that money should be used to first provide security in Haiti, so that the building process can actually take place. Food, water and shelter is great, but if you get murdered/raped/robbed, then what good is that other stuff?  Maslow’s Hierarchy of Needs comes to mind.

     To depend on piss poor UN troops, Rwandan security, or a depleted and ravaged Haitian police is not working.  I say contract a police force to come in and assist, and in the mean time build the prison up and build police capability.  But for security right now when it is most needed, there should be no hesitation.  Get it done, or watch crimes, murders, and rapes continue to be committed. That would be a good use of a small portion of that large sum of money. That isn’t disaster capitalism, that’s just human decency and compassion.  To stand by and watch is unacceptable.

   The third article goes into detail on how the Haitian police are struggling to bring order to the chaos.  They are simply overwhelmed. Thousands of prisoners have escaped, gang violence has increased, rapes have increased, and the police is dealing with a destroyed city and people.  So why is it that we are not sending in the cavalry?  Oh that’s right, the Rwandans are the cavalry.  Pfffft.

   Now get this.  In the fourth article, it discusses how the locals have had to organize their own security forces to deal with this stuff.  If that is not an indicator that police are in trouble, I don’t know what is. So is street justice better than contracting security who would be supporting Haitian security forces?

   The last quote and article is from Amnesty International.  They are screaming for more police in their recommendations, and their report is pretty clear.  Crimes are up, as is sexual assaults, and of course they want something done about it.  What is not in the report, is AI’s position on Rwandan cops trying to secure the mess in Haiti. The other thing that is missing is that AI made no mention of contracting security forces to step in to stop these stuff. It’s strange and somewhat disgusting to me that the humanitarian option in Haiti that continues to be promoted by all of these so called ‘humanitarian groups’, is to not do ‘everything’ within our power to stop this. -Matt

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US-UN Peace-keepers” bring Rwandan Police to Haiti

March 11, 2010

by Ann Garrison

In case anyone needed further evidence that President Paul Kagame’s Rwanda is the Pentagon’s proxy, 140 Rwandan police are about to undertake special training before heading to Haiti, as reported in the Rwanda New Times, because, according to Rwandan Police Chief Edmund Kayiranga, “Rwanda wants to be involved in promoting peace in other countries” and, if need be, they would send more peacekeepers to other countries.

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Funny Stuff: The Snicker Bar Gatling Gun

Filed under: Funny Stuff,Weapons — Tags: , , , , , — Matt @ 1:40 AM

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