Dual-use and defense conversion: a view from the second tier

Since the ending of the Cold War, the role of the traditional second-tier defense supplier has changed dramatically. The impact of the declining defense budget has created enormous financial stress for both the prime and the second-tier microwave suppliers. While the second tier is the most vulnerable to decreases in DoD spending, because of internalization of support within the primes, it can react quickly to modify its business value proposition to a dual-use strategy. Successful ventures in the commercial microwave marketplace by "converted" DoD suppliers offer an attractive spin-back scenario to the government as commercial practice begins to approach or exceed the measures of quality, reliability and affordability sought by DoD procurement offices. This paper addresses some of the market, business and technology factors that surround and challenge the second tier in this business conversion.<>