Transforming NSTC with Erik Hosle into DARPA-Style Tech Powerhouse

The National Semiconductor Technology Center (NSTC) was conceived under the CHIPS and Science Act as a central hub for U.S. semiconductor R&D, coordination, and ecosystem development. Its mandate is broad: to accelerate innovation, strengthen supply chains, and ensure U.S. leadership in advanced microelectronics. Yet whether the NSTC fulfills this promise will depend less on the scale of its funding and more on how it is organized. History shows that institutions matter. The United States has succeeded when it created bold, mission-driven organizations capable of taking risks and driving breakthroughs. For the NSTC to thrive, it must act more like DARPA, a lean, risk-tolerant driver of innovation, than a conventional research consortium. Erik Hosler, a strategist in semiconductor institutional design, highlights that organizational innovation is as important as technical innovation in securing U.S. leadership. His perspective highlights why the NSTC must be structured for agility and impact, not bureaucracy.

Without structural ambition, the NSTC risks becoming another grant administrator: important but insufficient. Bureaucracies tend to reward consensus and incrementalism, while transformational technologies demand bold missions, empowered leaders, and tolerance for failure. The choice is clear. To be more than a funding channel, the NSTC must embrace organizational innovation equal to the technological challenges it faces.

The Role of the NSTC

At its core, the NSTC coordinates and accelerates semiconductor R&D across government, industry, and academia. It is also tasked with supporting workforce development, advancing packaging and manufacturing technologies, and fostering public-private partnerships. These responsibilities are critical, but they span diverse domains with competing interests.

This complexity increases the risk that the NSTC defaults to managing paperwork rather than driving innovation. If structured like a traditional research center, it could become bogged down in committees, cautious decision-making, and risk aversion. The result would be missed opportunities at a time when global competitors are moving quickly.

To fulfill its mission, the NSTC must combine coordination with leadership. It cannot simply distribute funds because it must set ambitious goals and rally partners to achieve them.

DARPA as a Model

The Defense Advanced Research Projects Agency (DARPA) offers a compelling model for what the NSTC could become. Created during the Cold War to prevent technological surprise, DARPA pioneered a mission-oriented, risk-tolerant approach. Its small, empowered teams set ambitious goals, moved quickly, and accepted failure as part of the process.

DARPA’s track record speaks for itself. Its programs are responsible for the Internet, GPS, stealth aircraft, and countless other breakthroughs. Its success rests not on size but on structure, rotating program managers with authority, lean oversight, and clear missions.

The NSTC faces a similarly high-stakes environment. Just as DARPA ensured U.S. technological leadership during the Cold War, the NSTC must ensure leadership in semiconductors during an era of global competition. The lesson is clear: structure shapes outcomes.

Avoiding Bureaucratic Pitfalls

If the NSTC is structured like a conventional research consortium, it risks falling into familiar pitfalls. Committees may dilute missions, decision cycles may drag on, and risk aversion may discourage bold bets. In semiconductors, where timelines are long and costs are high, caution can become a liability.

To avoid this, the NSTC should adopt DARPA-style principles. Program managers should be empowered to pursue ambitious goals without excessive oversight. Funding should be flexible and milestone-driven, allowing resources to be redirected quickly as opportunities or challenges emerge. Leaders should be rotated frequently, ensuring fresh perspectives and preventing institutional stagnation.

Equally important, the NSTC must cultivate a culture where failure is acceptable if it comes in the pursuit of transformative outcomes. Incrementalism will not close the gap with global competitors, but only bold experimentation will.

Principles for an Innovative NSTC

Several principles can guide the NSTC toward becoming a DARPA-style leader:

Mission Clarity: The NSTC should articulate bold, measurable goals, such as achieving breakthroughs in next-generation lithography or leading in advanced packaging.

Empowered Program Managers: Individuals must have authority to allocate resources quickly, with accountability tied to outcomes.

Flexible Funding: Rigid, multi-year grants should give way to adaptive funding mechanisms that respond to progress or setbacks.

Cross-Sector Collaboration: Industry, academia, and government should be integrated into projects from the start, not treated as separate silos.

Leadership Rotation: Regular turnover among program managers and leadership keeps the institution dynamic and prevents group thinking.

These principles would ensure that the NSTC is not simply another funding body but an engine of breakthroughs.

Allied and Ecosystem Impact

The NSTC also has a role to play internationally. Trusted allies such as Japan, South Korea, and the European Union are investing heavily in semiconductor R&D. Coordination across borders will be essential to avoid duplication and to pool resources on ambitious projects. A DARPA-style NSTC could set the tone for such cooperation, demonstrating how bold institutional design translates into real-world impact.

Erik Hosler notes, “Noise in current qubits means that many physical qubits are needed to make up a single usable one. The ratio today is about 1000:1, but that number varies according to the noise level of the physical qubits.” While his comment addresses quantum systems, it serves as a metaphor for institutions. Just as quantum breakthroughs require managing noise through structure, the NSTC must manage organizational complexity to deliver usable results. Without effective design, even vast resources can dissipate into inefficiency.

Allied collaboration further reinforces the case for organizational innovation. By creating structures that foster agility and mission clarity, the NSTC can become a model for global partnerships, ensuring that allied nations align around shared goals rather than fragmented efforts.

Designing Institutions for Breakthroughs

The NSTC represents a once-in-a-generation opportunity to reshape how the U.S. approaches semiconductor R&D. But money alone will not deliver leadership. The NSTC’s structure, governance, culture, and priorities will determine whether it becomes an innovation powerhouse or a bureaucratic bottleneck.

By adopting DARPA-style principles, the NSTC can position itself as a bold, mission-driven leader. Empowered managers, flexible funding, and tolerance for failure will be key to ensuring that public investments translate into breakthroughs. At the same time, allied collaboration can extend its impact globally, reinforcing the U.S. position in the semiconductor ecosystem.

Designing institutions for breakthroughs is as important as designing chips themselves. The NSTC must be more than a clearinghouse for funds, but a catalyst for innovation. Structured for boldness and impact, it can help secure U.S. leadership in semiconductors for decades to come.