The End of the Assembly Line: Why the DoW Software Factory Era is Over

For the last decade, the "Software Factory" was the gold standard of defense innovation. Entities like Kessel Run and Platform One were the vanguards, proving that the Department of War (DoW) could indeed move away from the "waterfall" requirements of the 90s and embrace Agile development. They did their job, and they did it well.

But the mission has changed. The threat environment has accelerated. And frankly, the technology has moved faster than the government’s ability to hire coders.

The era of the bespoke, government-owned software factory is coming to an end. It is being replaced by something more lethal, more scalable, and more fiscally responsible: the Commercial Core Model.

Here is why we are calling "Time of Death" on the factory model, and what comes next.

1. The Power Gap: Commercial Outperforms Bespoke

The original premise of the software factory was: “If we can’t buy it, we’ll build it.” That premise is now obsolete.

Commercial platforms from companies like Palantir, Anduril, and Scale AI are no longer just "tools"; they are massive, AI-native ecosystems. These platforms deliver capabilities today, at IL5 and IL6 security levels, that a government factory would need five years and a billion dollars to replicate.

When industry-led innovation is already deployed at the Top Secret level, building a government-owned alternative isn't just redundant; it’s a strategic liability. We are choosing to build "okay" software tomorrow when we could be deploying "elite" software today.

2. The Economic Collapse of Bespoke Apps

The fiscal math behind the factory model has flipped upside down.

In the early 2010s, you needed a team of developers to build a custom logistics dashboard. Today, a junior officer with a low-code platform or a generative AI agent stack can build that same application in an afternoon.

When a 400-person software factory exists to maintain a suite of bespoke apps that could be replaced by a single enterprise license and a few drag-and-drop workflows, the GAO (Government Accountability Office) starts asking hard questions. The DoW’s modernization roadmap is already reflecting this, deprioritizing "factory building" in favor of enterprise cloud adoption.

3. The Pivot of the Flagships

Look at the pioneers. Kessel Run, the original "poster child" for DoW software, has shifted toward a vendor-led model. Platform One has evolved from a coding house into a DevSecOps environment.

These aren't signs of failure; they are signs of Command and Decision Advantage. These organizations have realized that the value isn't in writing the lines of code; the value is in the architecture that allows mission-relevant data to flow to the warfighter.

The SOCPAC Blueprint: A New Architecture

At SOCPAC, I had realized that we couldn't wait for a factory to build us a solution. We had to move to a modular architecture built on enterprise software cores. We think of it in terms of biology rather than assembly lines:

• The Brain: Strategic data decisions and fusion.
• The Body: Sensor-effector autonomy (making the hardware move and act).
• The Nervous System: Agent-driven AI feedback loops that connect the two.

By using a "Commercial Core," we can rack-and-stack specialized mission apps for logistics, ISR, and fires on top of a stable, secure foundation. We aren't building custom stacks; we are onboarding third-party tools in days and deploying agents to the edge via drag-and-drop.

Strategy & Capital: The Path Forward

The shift from "Software Factories" to "Commercial Cores" represents a fundamental change in how we think about Strategy & Capital. We must stop investing capital into maintaining "Government-Off-The-Shelf" (GOTS) software that is born obsolete. Instead, we must invest in the Mission Ontologies and LLM Agents that ride on top of industry-leading cores.

The goal is no longer to be a software company. The goal is to be a sophisticated integrator of capability.

The Takeaway: Software Factories didn't fail; they were outpaced. Thanks to open architecture and the relentless pace of industry, what used to take years now takes weeks.

If you are building the lightweight plugins, the specialized ontologies, or the autonomous agents that will power the next generation of US National Security, let’s talk. We have the rack space. The assembly line is closed; the platform is open.