Bureaucratic hurdles, slow procurement processes, and complex reporting requirements can turn opportunity into frustration for many European small and medium-sized defence companies. Hans-Christian Mathiesen, former chief of the Royal Danish Army Command and currently a defence industry representative, explains to EU Perspectives why Europe’s innovation sometimes struggles to keep pace with the speed of modern warfare.
Europe is at a crossroads. Faced with rapidly evolving threats—from Russian aggression in Ukraine to the rise of drone and autonomous warfare—the European Union has poured billions into the European Defence Industrial Strategy (EDIS). Its promise is ambitious: strengthen the continent’s defence industry, foster innovation, reduce reliance on foreign suppliers, and ensure Europe can defend itself with cutting-edge technology. EU Perspectives spoke about the nuts and bolts of the trade with Hans-Christian Mathiesen, vice-president of Vice President of Defense Programs at Sky-Watch A/S. The Danish company develops and manufactures professional mini-UAV systems, such as the RQ-35 Heidrun, which is used in Ukraine.
What do EU defence programmes look like in practice, from your perspective?
The structure is extremely demanding upfront. There is a lot of effort before delivery, extensive reporting, no guaranteed outcome, and often difficult negotiations around intellectual property within consortia.
The one genuinely positive aspect is the ambition: strengthening Europe’s industrial base, near-shoring supply chains, and mobilising serious funding volumes. Those are all necessary. The problem is execution. EU programmes appear almost tailor-made for large defence primes. These companies have built extensive bureaucracies over decades of interaction with state customers. They know how to navigate slow processes, compliance regimes, and reporting requirements because they have whole departments dedicated to it. Small and medium-sized companies (SMEs) don’t. For us, speed is survival. Every delay, every reporting obligation, directly competes with engineering, production, and sales.
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Excessive burdens
From an industry perspective—especially for small and medium sized companies—what does that mean in practical terms?
Europe often says it wants innovation and startups, but then buries them in reporting, compliance, and documentation. If you force a ten-person startup to dedicate two people just to EU reporting, you’ve effectively killed it. Those people should be building technology, not writing reports.
EU funding instruments are not useless—they helped us survive early on—but they come at a cost. They often pull companies away from core technology. You end up working on projects because funding is available, not because they align with your strategy. If a consortium partner fails, you may still carry the risk—or even the obligation to repay funds. For a small company, that can be fatal.
How does this affect Europe’s ability to innovate in areas like drones?
It drains speed from exactly the sectors that need it most. Drone warfare evolves in months, not decades. Western procurement—especially at EU or NATO level—is still optimised for legacy platforms like tanks or frigates. The irony is that Europe talks constantly about urgency, but its instruments systematically remove it. Consolidation in the defence industry makes it worse. Large primes are acquiring smaller companies and absorbing new technologies into long-life platforms. Drone warfare doesn’t fit that model; innovation cycles are measured in months, not decades.
Progress comes from leading nations
Are EU and NATO therefore the wrong level to drive rapid capability development?
For cutting-edge capabilities like drones, yes—at least in the short term. EU and NATO are very broad frameworks with diverging national interests, which naturally slows decision-making. Progress is more likely to come from lead nations or regional coalitions of like-minded states—for example, the Nordic countries, or frameworks like the UK-led Joint Expeditionary Force (JEF). These groupings share threat perceptions and political urgency. You can already see this dynamic in Ukraine: countries closest to Russian aggression are investing the most, moving fastest, and taking the greatest risks.
How does this fragmentation affect European strategic autonomy?
Geostrategy has returned. National threat perceptions now matter more than abstract European unity. The fading level of military support to Ukraine illustrates this clearly. EU-level funding instruments may become relevant for SMEs—but only once they grow large enough to absorb the administrative burden. At that point, you need redundant business development and project organisations just to participate.
Focus on operational effects
What would a more effective European approach look like?
Europe needs to focus less on specifications and more on operational effects. Procurement should buy what works now and iterate quickly, rather than asking industry to design perfect systems on paper. We also need a genuinely plural ecosystem—many specialised companies, competing and cooperating—rather than consolidating everything into a few large primes. Drone warfare cannot be mastered by a single industrial champion.
Europe must also build its own drone industry and reduce dependence on China. Right now, Chinese components are cheaper, better, and more available. Nearshoring supply chains will cost more initially, and procurement rules must reflect that reality. But European procurement still treats drones like tanks or frigates—over-specification, endless requirement lists, and unrealistic expectations. The focus should be on effects, not hypothetical future capabilities.
Are you pessimistic about Europe’s ability to adapt?
Not at all. Europe will adapt—we always do. The concern is timing. Right now, we are not adapting in the smartest or fastest way. Modern wars are fought primarily between machines. Soldiers rarely see each other; what they encounter are drones. Europe must act now to develop the speed, agility, and ecosystem needed to respond effectively.
