For decades, defense budgets have flowed into platforms like jets, tanks, ships and missiles. But in today’s rapidly changing threat environment, the real edge lies not in what you can build, but in how fast you can improve it. Supremacy in the skies is no longer measured in raw tonnage. It’s measured in iteration speed and software architecture.
This shift forces a hard reconsideration of how defense programs are structured, how readiness is measured and how funding gets allocated. A software-first approach isn’t just a technical upgrade. It’s a cultural transformation.
What Is Software-Defined Defense?
- Iteration Speed: Measuring success by how fast mission logic and algorithms are updated rather than platform counts.
- Virtual Prototyping: Using AI and simulation to test systems before physical production to reduce costs and risk.
- Operational Readiness: Moving away from “metal” constraints toward continuous delivery cycles (DevSecOps) to maintain a strategic edge.
Why the Shift From Metal to Code Matters
McKinsey estimates there is a $250 billion opportunity for defense organizations that scale emerging technologies like AI, advanced simulation and quantum computing. That figure alone should be a wake-up call: Hardware-only planning is already outdated.
Software and simulation tools are rewriting how engineers build and test complex systems. Virtual prototypes can “fly” before they ever take shape in the real world. Engineers can stress-test components, optimize mission logic and validate performance long before manufacturing begins. The result? Lower costs, faster deployment and fewer surprises in the field.
In an era where adversaries iterate quickly, that speed is everything. A nation that can update its defense systems in weeks, not years, will always have the upper hand.
What Better Code Actually Unlocks
Shifting from a hardware-centric model to a software-driven one changes how progress is measured and exposes where current defense systems fall short.
Iteration time becomes the new crucial metric for success. In a software-defined defense ecosystem, progress is no longer measured by the number of platforms delivered but by how quickly mission software, algorithms, and system logic can be updated and tested. Capability advances through continuous iteration rather than episodic hardware refreshes.
When software delivery lags, readiness suffers. According to the U.S. Government Accountability Office’s (GAO) 2024 assessment of the F-35 program, aircraft availability and mission capability are now constrained less by production rates and more by the maturity and stability of onboard software. Modernization efforts such as Block 4 rely primarily on software upgrades to unlock new functionality across the existing fleet. GAO documents that delays or instability in software delivery can leave aircraft delivered but operationally limited, demonstrating how decisively software execution now shapes readiness.
This represents a structural shift in how capability is upgraded. Hardware refreshes require new factory capacity, long procurement cycles and significant capital investment. Software-driven upgrades, by contrast, allow new mission functionality, system improvements and performance gains to be applied across existing platforms without restarting production lines. As defense systems become more software-defined, platform lifespan and operational value increasingly depend on code rather than metal.
That dependence also reshapes strategic resilience. In an environment of strained global supply chains and extended hardware lead times, systems that evolve primarily through software offer greater flexibility than those reliant on physical components. The ability to adapt mission logic, integrate new capabilities and validate changes through simulation allows defense forces to adjust faster than procurement timelines alone would permit.
There are already signs of what this shift from hardware to software readiness looks like in practice. The U.S. Air Force’s Kessel Run program demonstrated how reorganizing around software delivery can dramatically compress iteration cycles. By adopting DevSecOps practices and treating software as mission-critical infrastructure, Kessel Run demonstrated that software updates for operational systems no longer had to wait on multi-year acquisition cycles, with teams delivering usable capability on quarterly timelines instead of four- to five-year release schedules. When delivery models, incentives, and authority align around software velocity, code becomes a capability accelerator rather than a bottleneck.
McKinsey’s research reinforces this. The firm estimates a $250 billion opportunity in modernizing defense by scaling technologies such as AI, advanced simulation, and quantum computing but warns that capital alone is not enough. Across defense ecosystems, the biggest bottlenecks are no longer invention, but adoption: fragmented funding, slow acquisition pathways, legacy infrastructure and limited computing capacity at the tactical edge.
Without new delivery models that prioritize software-defined systems, modular upgrades and faster transition from prototype to fielded capability, even mature technologies risk stalling before they produce operational impact.
Why Legacy Investment Models Are Misaligned
Despite all this, many defense budgets remain stuck in a 20th-century mindset. GAO assessments of major defense programs like the F-35 Joint Strike Fighter Program show that acquisition and budgeting processes remain structured around hardware delivery, with software, digital infrastructure and simulation treated as secondary investments rather than primary capability drivers.
As former Kessel Run leaders have argued, the DoD continues to apply Cold War-era acquisition models to software-defined warfare. We are still structuring budgets and procurement processes around hardware timelines rather than sustained investment in digital infrastructure and continuous delivery.
That’s a problem because hardware delivery runs on multi-year timelines, while software moves in sprints. When organizations treat code as an afterthought, they give up the agility that defines modern defense readiness.
There’s also a cultural challenge. Many organizations still see software teams as “support,” rather than as mission-critical contributors. That mindset slows innovation and discourages cross-functional collaboration.
And metrics haven’t caught up either. Readiness is still tracked in platform counts or tonnage rather than update velocity, availability or system maturity.
What Tech Leaders in Defense Should Do Now
For defense technology leaders including CTOs, engineering VPs, software architects and program managers, this shift starts with reframing the architecture. Treat your platforms as living systems. Map where simulation, software and mission-logic updates can drive more value than another round of procurement. Build modular systems that separate mission software from the hardware shell, so over-the-air updates and rapid improvements become possible.
The next step is to invest in simulation and virtual prototyping. The ability to “fail fast” in simulation is what separates the organizations that innovate continuously from those that stagnate. Digital twins and design-space exploration tools help teams test scenarios, catch flaws and make changes before the first component is ever built. Every digital failure saves time, money and human risk later on.
Measurement needs a reboot, too. Old KPIs like “jets delivered” or “hardware cost” don’t tell the story anymore. Start tracking iteration speed, update frequency and uptime. How many aircraft are running the latest build? How long does it take to push a patch to the field? These are the metrics that define digital-age readiness.
Finally, funding and supplier relationships have to evolve. Partners should be incentivized for continuous delivery, faster software cycles, sensor integrations and mission-logic refreshes, not just production volume. Shift contracts from “build once” to “iterate continuously.” In practice, that means paying for agility, not just assembly.
A Cultural Shift and a Technical One
Becoming software-first isn’t just about writing more code. It’s about changing how defense leaders think about innovation itself. Platforms can’t be treated as finished products; they must be managed as evolving ecosystems. That requires tight collaboration between design, software, and operations from day one.
Flight hours and physical assets don’t tell the full story anymore. If the software running those systems is outdated, readiness is only an illusion. McKinsey’s data shows the window to modernize is narrowing as emerging technologies like AI and quantum simulation scale globally. The defense organizations that move fastest will define the next era of readiness.
Because the next breakthrough won’t roll off an assembly line. It’ll come from the cloud. It’ll come from better algorithms, faster updates, and simulation-driven design. If air superiority is decided in code first, why is the budget still built for metal? The mission has changed, and so must the mindset.
