Matt Daniel, a former Major in the United States Marine Corps and currently Principal and Managing Director of Bizbatt Inc, explains how lean and six sigma helped the US Naval Aviation to identify, prioritise and fill capability and efficiency gaps in combat scenario planning, when funding is tight.

Leveraging lean principles and management techniques, US Naval Aviation has created and employs a process we call the Systematic-Horizontal Integration Process (S-HIP), a strategic approach that provides reliable aid for big fiscal decisions. It systematically decomposes where we are on the road to achieving the “future picture” (or future state), and provides clear guidance for how to achieve it.


How does the S-HIP approach is work?

The US Department of Defense (DoD) budgets in five-year cycles. The budget is revisited and renewed annually. It is a rolling cycle designed to maintain a capability advantage over what the US Intelligence Community (IC) projects as the most likely and dangerous threat in five-ten years.

The DoD provides funds for the US military services: the US Army, the US Air Force and the US Naval Services (Navy and United States Marine Corps). Each service manages its own budget to create and achieve its own future state, which must remain consistent with the overall future plan for the posture of the DoD.

Within the context of achieving the “future picture”, every year US Naval Aviation has dozens of important capability and efficiency gaps they would like to fix. Since Naval Aviation is granted only a portion of the entire US Navy budget, they cannot do it all. There is never enough money to get it all done.

This calls for prioritisation, which is tricky when manpower, equipment and technology are all inter-connected and are fighting for the same dollar. Fully funding one gap-filler while only partially (or not at all) funding another affects our total mission capability.

The problem requires a pragmatic approach to balancing mission requirements, expected lethality of the future threat, planned US Naval Aviation capabilities and, maybe most importantly, budget dollars available.


The background

US Naval Aviation, as an enterprise, is immense. It includes both US Navy and US Marine Corps aviation, and provides important capabilities and a force presence that ensures security and stability across the globe. By nature, it is a complex behemoth whose value is realised through its ability to address the most advanced and/or likely domestic and global threats. Playing military-readiness “whack-a-mole” with the ever-evolving and complex threat is a tall order made more difficult by a complicated DoD budgeting and acquisition process. Strategically navigating this process is critical to the success of the US Navy.

The enterprise is guided by critical mission capabilities, which are contained in Title 10 of the United States Code of Laws.

In short, Naval Aviation must support these four major capabilities: power projection; nuclear deterrence; sea control; and international logistics (sealift) duties.

This hinges on managing a number of circumstances. Some of these are controllable, some are not, but all must be considered. Listed below are a few of these circumstances. They can be thought of as critical influencers, levers or dials that represent trade-space for Naval Aviation programmes.

  • BUDGET: Cost/efficiency and total financial obligation authority. Annually, a budget that limits and directs DoD funding is published. This budget demands due diligence in the pursuit, defence and protection of programmes (things that it buys). This is especially important when financial times are tight.
  • TECHNOLOGY: The art of the possible. Are we appropriately positioned to take advantage of new or emerging technology? Are technology advancements predictable? How may we find and employ them first? Are we prepared to integrate them?
  • TIMING. Considering the budgeting cycle of the DoD, it is sometimes difficult to stay ahead of the competition’s decision process. The architecture of the S-HIP approach helps US Naval Aviation “lead-turn” anticipated threats to US National and global security.
  • PROGRAMMES: Acquisition plans. The enterprise is supported by dozens of “programmes” that require oversight, planning and execution. They are not always managed with the overall success of the missions in mind. These programmes are very involved and expensive, they represent hundreds of millions of dollars of investment. They include the myriad aircraft, sensor systems, weapons, jammers, self-protect equipment, radios and other communication suites that the enterprise relies upon.
  • HORIZONTAL INTEGRATION. Measuring success of the entire mission instead of the health of any individual programme is the focus and goal of horizontal integration across equipment and acquisition programmes.

By nature, in complex organizations, inefficiencies in the form of “stovepipes” sometimes spring up.  In US Naval Aviation, these stovepipes tend to narrowly define and insulate big programmes (aircraft, communications, sensors, radars, etc), sometimes resulting in myopic views of success. In this environment, stovepipes are addressed through the S-HIP process by forcing horizontal integration.

  • FAMILY OF SYSTEMS APPROACH: How one programme performs affects others. In pursuit of mission success, no single tool, weapon, sensor, aircraft is the lone answer. Assets work together, with synergy, to create efficiencies and capabilities.  The family of systems idea is one of teamwork.
  • VISION: Well-articulated, well-understood future picture. Getting those who are involved to embrace and drive towards a common future and strategic picture of the enterprise is necessary. It is also very difficult.
  • EXECUTION: Performance and reward. Promotion, recognition, reward is customarily tied to the success level (read: funding and growth) of the programme represented by the individuals working on it. That is to say that programme success is usually not measured with regard to mission success, but instead with a focus on the health of the individual programme in question.
  • COMPETITION: The threat. The competition has a vote. Who/what is the threat? What is the threat by the time our advanced capabilities are available? How is the threat satisfying for their “Title 10” requirements? Can we stay ahead of the threat and keep it on the defensive? Is the threat internal or external? Understanding the threat is necessary if we are going to adequately address it.

The objective is to manage these levers or dials to more efficiently build, buy, field, integrate, operate, update and maintain the best and most capable “stuff” to keep us ahead of the competition while staying on budget and timeline and in sync with our strategic direction.


So what? I don’t work for the Navy.

Given what we know about the threat (or competition) in a specific timeframe, are we building, buying, integrating and then using the right stuff at the right time to accomplish our missions? Again, how do we ensure that we are strategically focused?

Our answer to these questions is through the horizontal analysis approach: Systematic-Horizontal Integration Process (S-HIP).


How does the process work?

MISSION:  The year is 2018. US Naval Aviation must be able to provide surveillance and tracking for ship safety in international waters.  Are we prepared or preparing to successfully do this in the variety of global geographies where we expect to find our fleet?

A team of technical, operational and intelligence experts or subject matter experts works together to assess what success looks like in this mission example. They evaluate current plans for achieving success and then look at what problems the threat (competition) will present. This team is responsible for understanding and articulating to leadership their findings in the form of gaps, projected or possible solutions and also any redundancies. The S-HIP process, through the steps below, evaluates how good we will be, given our current plan and how badly we will fail if we do not address our projected problems.

These are the business steps used in the S-HIP solution:

a. Scope the effort: identify the time frame in question, the threat and the geography (the market). This comes from the highest level of leadership.

b. Build the coalition: the COW (coalition of the willing) is a team of trusted agents who can be relied upon to answer the call, work together with focus to help articulate the problem, dissect it and then remain on task to identify deficiencies and push for solutions. The COW should consist of members from an organisation’s centers of excellence: quality assurance, process experts (Black Belts/Master Black Belts), etc.

c. Focus on specified missions: identify the missions that are likely to be assigned within this scope. For the Navy, these may be reconnaissance or jamming or defensive/offensive missions; for industry they may be oriented to new product or process development, manufacturing or market penetration. This also comes from leadership as this is also a function of the strategy of the enterprise.

d. Define mission success: define the future picture, what does success look like in each of these missions.  How good or capable do we have to be? Leadership influences this step, but the group of subject matter experts establishes the definitions.

e. Define the effects chains: once there is a good understanding of what the mission is required to accomplish, it becomes helpful to break down the mission into functional steps. These steps should describe the end-to-end (beginning, middle and end) functions of the mission.

f. Establish scoring criteria: it is necessary to be able to score performance in each function of the effects chain. If there is a “secret sauce” of this process, it is being able to define functional success with technical detail. A RED (bad: fails), GREEN (good: can do the function in all conditions expected) or YELLOW (somewhere in-between: succeeds in some conditions, fails in others) scoring convention generally works well. Establishing scoring criteria requires considerable thought, discussion and teamwork.

g. Develop concepts of operations (CONOPS): with the operational COW members, pull the strings on how the organisation, with its pieces, parts and processes, will work to accomplish the mission given the environmental conditions and the appropriate threat. It’s important to get a level of fidelity with respect to developing the CONOPS. Without accurate and well-detailed CONOPS, a logical mission flow with answers to the questions “Who does what?”, “When?”, “With whom?” and “How?” is not achievable. Without this, the effort cannot get out of the starting blocks.

Who is doing what throughout the mission is the essence of the S-HIP analysis. Functional and interoperability gaps are tough to find if there is no understanding of who is accomplishing the functions.

h. Populate effects chains: the systematic breakdown of the CONOPS is next. Binning the appropriate piece of equipment, people or process into the effects chain functions allows us to now assign specified actions to specific responsible parties, and within the broader context of the success of the mission.

i. Check technical capabilities and horizontal interoperability: otherwise known as “myth-busting.” Once the equipment or processes are placed into the effects chain format, the task is to articulate what they are supposed to be actually accomplishing in the appropriate function and how. The “how” is very important to understand. The functions of the effects chain are now possible to score.

Next, it is time to validate that the enterprise has interoperability in place to be able to move from one function to the next.

The effects-chain approach helps to understand what capabilities are necessary within the context of the mission. This calls for technical investigation and analysis as to whether or not mission success expectations are realistic. Identified operational and technical deficiencies and gaps are the products. Functional gaps, with the background of mission success criteria, drive the business to build, adjust or defend requirements.

j. Score the effects chain functions: using a recognisable convention like a stoplight scoring methodology (RED = broken, GREEN = works well, YELLOW = something in-between), score the effects chains to illustrate and put context on the gaps and deficiencies discovered. Scoring the effects chains provides an easily digested story. RED scores are normally gaps. YELLOW scores may be gaps, especially if they are unexpected or usually misunderstood as “of course we can do that.”

Examples: In an electronic warfare effects chain, we may have scored the survey function RED because the receivers we have located in the airspace (in the CONOPS) are unable to sense signals of the same frequency that RED is known to be able to use in 2020.

Or maybe in a sales effects chain, we scored the track function YELLOW because our sales people do not have a sales CRM (customer relationship management) tool that facilitates keeping tabs of (tracking) and reporting the status of prospects while trying to validate real-business opportunities. It is not scored RED because the prospect may be tracked manually, but requires excessive effort to score it GREEN.

k. Develop gap mitigation options: work with subject matter experts to define requirements and create courses of action (COAs) to address the capability gaps. These COAs may be technology, material, business, process, logistics or human capital oriented. This is where the technical possibilities marry with requirements.

l. Illustrate gaps and offer repairs: technical and operational deficiencies are now apparent and are articulated to the appropriate leadership parties. Repair plans with well-illustrated requirements and technical solutions are offered as well.

In this step it is also likely to identify redundancies and unnecessary capabilities. Efficiencies can be created.

m. Build mission success portfolios: understanding the goals of the organisation, the markets or capabilities that are a priority, the Title 10 obligations of the organisation, what is required to be successful in each mission? What things are represented in the effects chains? These are included in these portfolios.

The capabilities that these portfolio items require to be able to work across the effects chains towards mission success become apparent. The effort results in decisions that illustrate the value of building, maintaining or funding one capability over another.



It is important that the effort follows a logical organisational drumbeat. The process was developed to help requirements officers better create and vet their programmatic acquisition decisions. The acquisition cycle is an annual process to which S-HIP, with its various steps, lines up nicely. Each organisation operates to their own business drumbeat.


To conclude

US Naval Aviation has successfully protected mission critical capabilities and hundreds of millions of dollars by using the S-HIP approach to efficiency. The process has made the Navy much more capable. While otherwise being threatened, important defence systems have been funded fully because of this process.

In a time when budgets are tight, due diligence and proof is in order. The type of proof that the S-HIP methodology brings fits the bill. It provides strategic and wise guidance; it enhances mission capabilities.  For industry, the S-HIP process saves money, reduces waste and reinforces leadership, teamwork and strategic alignment. For the Navy, it ensures mission success and, in the end, saves lives.



After reading this article, please take some time to consider your and your organisation’s circumstances and conditions. Revisit these actions:

-Think about the processes your organisation uses;

– Think of your processes from an “effects chain” point of view;

– Try to articulate your organisation’s future picture(s);

– Think then about how “horizontal integration” may increase efficiency, reduce waste and remove dysfunction within these processes;

– Ask the question: “How may this process help my organisation?”

– Consider: can this augment or even rejuvenate the lean and operational excellence processes?