Rigidity permeates military culture, which is why it’s particularly paradoxical that flexibility is the route through which two military contractors in the Ann Arbor area are thriving.

Software firm Soar Technology, which was spun off from the University of Michigan in 1998, and Sun Engineering have smoothly integrated key changes into their business models. Those changes have positioned the companies to navigate the dynamic funding model in their markets.

In recent years, Ann Arbor-based SoarTech, for example, gradually shifted its focus away from futuristic research toward research that can deliver more immediate technology for the military.

Sun Engineering is moving to the old R&B building in downtown Saline.

Melanie Maxwell | AnnArbor.com

Now, under the leadership of CEO Michael Van Lent, who took over for founder James Rosbe in January 2009, SoarTech is drawing attention for its work developing digitally simulated aircraft control systems.

SoarTech was one of 11 companies to win the U.S. Department of Defense’s Army Achievement Award, which honors Small Business Innovation Research projects. SoarTech was honored from a list of 471 Phase 2 projects.

SoarTech’s project was a $750,000 contract that allowed the company to build a software system to support a speech-based aircraft control concept it had proposed in a Phase 1 project. The technology originated through an ongoing partnership with U-M’s artificial intelligence laboratory.

“The project itself is focused on controlling different kinds of automated aircraft in a unified way,” Van Lent said. “There are a lot of simulation systems out there that have a lot of different ways to control their simulated aircraft. We give one unified way to control all the different kinds of aircraft and all the different kinds of simulations and make it very close to how an aircraft controller would (operate).”

SoarTech is aiming to attract partners among the major military contractors - firms like Lockheed Martin and Boeing - to help win a Phase 3 deal, allowing the aircraft control system to be designed for commercial use.

Van Lent said he’s hopeful that the credibility the university’s brand provides could help SoarTech strike a deal with a major corporate partner.

“We have to find one of these large players and convince them we have something valuable to offer them that they don’t have themselves already, and that’s where the innovative technology from U-M comes in,” Van Lent said. “Having the university as a continuing source of new and innovative technologies that we can draw on is essential to our strategy.”

In a similar example of business model flexibility, Sun Engineering is moving from Pittsfield Township to downtown Saline’s R&B building precisely to accommodate its new strategy. The firm, established by entrepreneur Andy Warner in 1996, has designed and coordinated manufacturing projects for military contractors for the last 15 years.

But the firm now believes that it needs to start manufacturing goods itself - and that’s why the company purchased the R&B building for $1.3 million.

Sun Engineering plans to start manufacturing missile defense support equipment within weeks at the 62,000-square-foot building, where it plans to grow from 15 employees to 27 by the end of the year.

“Call me an old-fashioned entrepreneur, but we’ve grown very organically by references and word of mouth,” said Warner, a U-M graduate. “That’s worked well for us, and it’s led to a very steady growth curve.”

Contact AnnArbor.com’s Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com’s newsletters.