Balancing Expertise: Germany's Military Reserve System and Bottom-Up Innovation
Guest post by Dr. Daniel Biene, Digital Entrepreneur
In an era defined by technological advancements and the need for adaptability, Germany's military reserve system features an innovative yet already well proven and established approach to leveraging civilian expertise for national defence. Central to this effort is the Cyber Innovation Hub of the German Armed Forces (CIH), which serves as a platform for bottom-up innovation and cross-sector collaboration. By drawing on the skills of reservists and civilian professionals, the Bundeswehr (the German armed forces) is fostering a culture of creativity and modernization that addresses both immediate challenges and long-term transformation.
To anyone familiar with the space it is obvious that Germany’s activities in defense innovation are lagging far behind many other nations in scope, breadth, funding, and impact. Despite this fact, setting up the Cyber Innovation Hub seven years ago and marrying it with certain unique elements of the German military reserve system has proven to be an act of foresight by then Minister of Defence Ursula von der Leyen.
State-of-the-Art Innovation Governance
From day one, the CIH was given a direct reporting line to top leadership within the Ministry of Defence. It is a well-studied fact that many innovation units in corporations and public entities alike fail because they do not receive the kind of top leadership attention required for successful innovation. Germany avoided making this mistake, to the envy of some allies’ military innovation units, which are riddled with organisational politics and mid-level red tape. In addition, the CIH’s civilian personnel and procurement tasks are hosted by a private legal entity wholly owned by the German government. The setup enables a degree of agility not usually found within military or administrative organisations.
Integrating Civilian Expertise
Germany's reserve system incorporates civilian professionals from diverse fields such as technology, management, and innovation. These reservists bring fresh perspectives from their civilian roles, contributing to initiatives that challenge conventional military frameworks. The Cyber Innovation Hub, staffed partly by reservists, exemplifies this integration by acting as a bridge between the Bundeswehr and the private sector. Its mission is to identify, develop, and implement innovative solutions that enhance operational effectiveness while addressing emerging needs.
Matching Skills to Innovation Projects
A cornerstone of the CIH’s success is its ability to match reservists’ skills with relevant innovation projects. For instance, a reservist with experience in start-ups or venture capital might work on refining procurement processes or testing new technologies for military applications. Similarly, experts in design thinking or agile methodologies contribute to reshaping traditional workflows, making them more efficient and adaptable. This targeted approach not only optimizes the impact of individual contributions but also accelerates the adoption of new ideas within the military structure.
The CIH also promotes a collaborative environment where reservists can work alongside active-duty personnel, fostering mutual learning. This collaboration ensures that innovative ideas are grounded in practical military needs, while exposing active-duty members to civilian methodologies that encourage flexibility and problem-solving.
Duration and Compensation
Its flexibility is one of the unique feature of the German reserve system. Depending on military needs and personal situation, reservists can choose to serve a tour of duty of anywhere between a single day and ten months.
While on their tour of duty, reservists are compensated according to their personal circumstances, rank, and other factors. As a general rule, the Bundeswehr strives to make sure that reservists are able to maintain the same standard of living they have in their civilian life. Hence, reservists typically have to submit their payslips or tax returns and are reimbursed the amount they otherwise would have earned in their civilian life. This amount is capped at a level somewhat lower than what most well-qualified reservists make in their civilian professions – especially in highly sought after fields in innovation and cyber, or in entrepreneurship. By public service salary standards, it is however a relatively generous amount.
Intangible rewards for reservists have significantly increased over the past for years. After decades of mixed perception of the Bundeswehr in the eyes of the German public, approval ratings and public appreciation have skyrocketed to unprecedented numbers in light of the changed security landscape.
Lessons for the Future
Germany’s focus on bottom-up innovation through the Cyber Innovation Hub with its governance and methodology, well honed and success proven over seven years, can serve as a model for both Germany and allies. By empowering reservists to take an active role in driving change, the Bundeswehr demonstrates how military organisations can remain agile and forward-thinking in a rapidly changing world. At the same time, this approach highlights the challenges of integrating diverse perspectives into a cohesive framework, requiring ongoing dialogue and adaptation.
As other nations seek to modernise their armed forces, Germany’s experience with the CIH and its reserve system provides valuable insights. It underscores the importance of collaboration, adaptability, and the strategic use of civilian expertise to build a resilient and innovative defence force. Undoubtedly, Germany has significant catching up to do, in defence innovation and more broadly speaking. With aligned leadership and building on what already is there, the task can be done.
Dr. Daniel Biene is a member of the German Army Reserve and serves on the Leadership & Strategy Team of the German Armed Forces Innovation Hub. There, his work focuses on enabling the German military to utilise startup innovations.
In his civilian life, Daniel has spent the past ten years founding, growing, and selling several innovative tech-enabled companies in the SaaS, digital marketplaces, and professional services spaces. He has extensive experience working with major venture capital funds and structuring small and large transactions. Previously, for another ten years, he has held senior leadership roles in well known media companies in Germany and the United States.
By training, Daniel is a business lawyer with a media and entertainment industry focus, qualified in both Germany and the United States. In addition to his German and American law degrees, he attended law school in Switzerland and Hong Kong, completed executive education at Wharton Business School (University of Pennsylvania) and holds a Ph.D. in Law & Economics from the Max Planck Institute for Innovation and Competition in Munich.