Playbook for Primes: How to Compete on Agility Without Losing Legacy Strengths

At the Wharton Aerospace Conference, leaders from BWXT, Boeing Phantom Works, and Oshkosh Corporation examined how incumbents can compete with fast-moving, tech-native entrants. Their key insight: agility is not a cultural trait—it’s a system design choice.

Startups may lead in speed and flexibility, but primes retain strengths in scale, integration, and sustainment. By combining both, incumbents can stay competitive. Here are five core recommendations.

Recommendation 1 – Make Dual-Track Explicit: Separate Explore vs Exploit

Create two clearly defined lanes:

• Explore for innovation and early-stage development
• Exploit for production and execution 

Ensure there are structured pathways for technologies, funding, and talent to move between them.

Recommendation 2 – Give the Explore Lane Different Rules: Contracts, Tools, and Risk

Allow the Explore lane to operate with greater flexibility by:

• Using adaptive contracting approaches
• Leveraging lightweight, modern tools
• Accepting higher levels of risk and experimentation 
  

Formalizing these differences enables faster iteration and learning.

Recommendation 3 – Build a Real Digital Thread So Explore → Exploit Is Smooth

Develop a connected digital backbone that links design, testing, and production. This ensures:

• Faster development cycles
• Reduced rework
• Easier transition from prototype to scalable systems 
  

Focus on measurable improvements in speed and efficiency.

Recommendation 4 – Use External Partners as Force Multipliers in the Explore Lane

Leverage partnerships, especially in AI and advanced technologies, to accelerate innovation.

Establish a structured process to identify, evaluate, and integrate partners so their capabilities can be effectively transitioned into core programs.

Recommendation 5 – Re-Wire Incentives: People and Money Must Reward Agility

Align incentives with dual-track operations to ensure innovation is sustained.

Personal incentives – how people “win”

• Use separate performance metrics for Explore (speed, experimentation, transitions) and Exploit (cost, quality, reliability)
• Reward learning and calculated risk-taking
• Treat innovation roles as valuable for career growth 
  

Financial architecture – how money “wins”

• Dedicate funding for innovation and technology insertion
• Track adoption of new capabilities at the program level
• Implement faster, more flexible internal funding processes
  

Final Thoughts

Primes can remain competitive by intentionally designing systems that balance agility with their traditional strengths. When structured correctly, innovation becomes an advantage instead of a disruption.