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Heidi Jacobus, Chairman and CEO for Cybernet Systems Corporation, appeared September 19, before the Defense Business Panel to provide testimonial on the merits and deficiencies in the current Small Business Innovative Research (SBIR) program as applied to the Department of Defense. This special panel was established by the chairman of the House Armed Services Committee.

Jacobus, who has 20 years of experience since starting a high-technology federal contracting business from scratch, shared that without the highly-competitive, merit-based SBIR program, she is confident that her company would not have been able to exist.

Jacobus believes the current SBIR Reauthorization, in its 12th continuing resolution (CR), has been fraught with fractiousness over many issues, including who is eligible to compete for an SBIR, and who qualifies as a small-business owner and operator. “I believe the proposed changes are drastic departures from a 30-year proven program,” said Jacobus, “and will not be for the good of the Soldier, Sailor, Airman or Marine.”

Cybernet has received many federal contracts and although they have worked for many agencies, their work is mostly for the Department of Defense, all selected after rigorous nationwide competitions. In addition to the federal contracts, Cybernet Systems Corporation has been granted more than 35 U.S. Patents for their innovations.

In her testimony, Jacobus argues the viewpoint that the allocation of SBIR funds to 1-500 person sized small businesses should not exist, that ‘if the company is good enough it can compete for R & D contracts.’ But Jacobus told the panel she could give many examples from her business’ attempts to win contracts in David and Goliath settings.

“Without SBIR, nearly one half of the nation’s technically competitive technical staff will not be allowed to bring their knowhow directly to the DoD,” she said. “They will only be allowed to compete with service firms like travel agencies, janitorial service and temp agencies for what is still an insignificant dollar amount small business contracting through the large Prime contractors.”

She continued on to explain how large companies that desire the forward looking work can apply massive internal research and development funds (IR&D or “IRAD”), which are for the most part also re-purposed federal funds. “Even in the case of a small “starter” contract of several hundred thousand dollars, a larger prime can apply “loss-leader” funds and “special knowledge pertaining to the bid” to its bid and proposal (B&P) funded effort,” said Jacobus. “The result is the smaller businesses won’t win, even when they are lower in cost and may have a technical edge.”

When Jacobus founded Cybernet, the largest of defense contactors were far smaller than they are now, and communication and potential collaboration was easier. “We have built our business on niche, innovative, advanced military technologies and the occasional commercial spin-out license,” she said. “Our group has many advanced degrees, with Ph.D.s and many Masters Degrees in a variety of topics – computer science, electrical engineering, mathematics, mechanical engineering, nuclear engineering, physics and so on.”

But there is a place for both small and large businesses in this ecosystem and each part works with the other, Jacobus noted. “Small business is an unrecognized, but vital part of the defense supply base and SBIR is all that keeps it available to the DoD,” she said. “Keep SBIR, keep SBIR strong. We are, as they say, shovel ready.”

Heidi Jacobus is CEO of Cybernet Systems, based in Ann Arbor.

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Capital Communications & Consulting

Technology Trends and Updates

Did You Know?
Cybernet quickly developed and fielded the Automated Tactical Ammunition Classification System (ATACS), for the U.S. Army, which uses the product to reclaim serviceable ammunition through this faster, safer and more consistent inspection process. The ATACS can inspect more than 5,000 rounds of ammunition per hour (depending on round mix), reducing the manpower needed to handle loose, broken lot ammunition.

Cybernet Prepares For 2011 I/ITSEC
Engineers from Cybernet will be hosting a booth at the 2011 Interservice/ Industry Training Simulation and Education Conference (I/ITSEC) in Orlando, Nov. 28 through Dec. 2.

Product Spotlight: NetMAX Robotics
One of the most successful NetMAX Robotics product areas is force feedback, or tactile computer game devices. Under NASA funding, these force feedback joysticks have been mass-marketed and offered by Sony, Microsoft, Logitech and other companies. These devices are the largest selling consumer robotic products in the market, with more than 100 million sold since 1997.

SWMA Integrating Advanced Technology into Critical Mission Activities
The Supportability Wireless Maintenance Assistant (SWMA) product provides a portable self-contained diagnostic and maintenance application that couples high-speed, high-performance worksite support through a user friendly, rugged, handheld computer. SWMA is an ideal example of how Cybernet supports user productivity through integrating advanced technology into mission critical activities.

Cybernet Awarded SBIR for Geo Pairing
Cybernet was recently awarded a Small Business Innovation Research (SBIR) grant to develop a proven way of training non-line-of-sight weapons systems in the live training environment for the Army.

SBIR is a highly competitive three-phase award system which provides qualified small business concerns with opportunities to propose innovative ideas that meet the specific research and research and development needs of the federal Government.

As a trusted partner for every major branch of the U.S. Military, the U.S. Department of Defense and DARPA, Cybernet's defense-related technologies and products aim at making the essential work of our servicemen and women easier and safer.

Army War College Invites CEO As Speaker
Heidi Jacobus, Cybernet Chairman and CEO
The Army War College brought together leaders of industry, including Cybernet Chairman and Chief Executive Officer, Heidi Jacobus, to talk with Army War College students during the 2011 Industry Day.

The annual event provides a forum for students to gain a better understanding of the military-industrial relationship, the Army requirements and capabilities development process, and the acquisition processes.

"It is a unique opportunity for students to consider the complexities of providing the correct mix of capabilities to the warfighter now and in the future," said Maj. Gen. Gregg Martin, USAWC commandant, during his opening remarks.

Proven Solutions to IA Challenges
In response to the increasing demand for network security and cybersecurity solutions, Cybernet has established an Information Security Division (ISD) in Orlando, Florida, with an IA team located in San Diego, CA.

The ISD will be the Cybernet SBIR focal point for technology solutions for enhancing network and cyber security.  The ISD is also the Cybernet center of excellence for Information Assurance (IA), Information Security Engineering (ISE), Multi-Level Security (MLS) and Cross-Domain Solutions (CDS) for the Navy, Navy, Air Force, Marine Corps and Coast Guard.

Press Desk of Senator Debbie Stabenow

Army War College Public Affairs Office


Cybernet Systems is moving into bigger offices as the company continues to grow in Ann Arbor.

The 20-year-old company's Pittsfield Township office is in the location where Costco plans to build a new store. That prompted the firm to find a new space about a mile away that is about 15 percent bigger. This move will help accommodate the company's hiring of four people before this year ends as well as its plans to hire up to 20 more next year.

"There are a lot of possibilities for growth here," says Norma Heller, vice president of finance and operations for Cybernet Systems.

The company now has 48 employees, including a handful at its newly opened Florida office. That office provides information assurance services, such as verifying and testing computer systems for government agencies.

Cybernet Systems has two new products on offer, including a virtual lab for vehicles and a hand-held computer that helps Navy shipmen perform maintenance on their vessels. It is also hoping to land a large contract with its ammunition sorting machine.

Source: Norma Heller, vice president of finance and operations for Cybernet Systems
Writer: Jon Zemke

Wayne State University College of Nursing