"I almost didn't make it to San Diego this week," he said Tuesday morning at the San Diego Convention Center.
The department placed a prohibition on nonessential travel due to the ongoing budget crisis. That included even a four-star U.S. Navy admiral.
"We made a policy decision that we can do a better job of scaring you if we are out here in person," he said, sparking some nervous laughter. "That made it truly mission essential."
"Three hungry wolves," Winnefeld said, are bearing down the budget trail toward the Department of Defense sled, in the form of debt limitations, the continuing resolution and sequester.
"It's increasingly apparent that [sequestration] wolf is going to catch us," he said.
Those automatic cuts, which are slated to eat $492 billion out of the military budget over the next 10 years, have a delayed trigger date of March 1.
"In the worst-case scenario, the continuing resolution and sequestration would both catch us and gobble up much of our sled," Winnefeld said.
In an uncertain budget environment, one thing is for sure: The defense world is about to change.
"We will have less money, we just don't know how much less or when we are going to find out how much less," Winnefeld said.
He admits that it is no way to run a business, and the department is working through it the best it can.
"We recognize there is a period of deficit reduction. We will have to work together to try to fix this problem," he said. "It could be a lot harder under some budget scenarios facing us."
Internally, they are doing what they can to drive efficiencies such as shrinking initial capability documents from 300-page "behemoths" written by contractors to 10-page documents written by warfighters.
"There's much more work to do," Winnefeld said. "We need to find more commonality across services and missions if we can."
There's an increasing need to construct counter-terrorism operations where conventional land bases aren't available. That includes investing in afloat forward staging bases.
"If we can keep money stable, it will be built here in San Diego," Winnefeld said.
Investments in cyber are expected to increase.
"It's one of the very few areas that will actually increase in an environment where the budget is declining. It's another example of what of our national security interests play a strong role," he said.
Industry is part of its total force, he reminded the audience.
"We have to look at program cost, schedule and performance to find where the winners and losers are," he said.
The suppliers who gain an advantage will be the ones who can deliver on time, deliver things that work and protect their networks from exfiltration of sensitive information.
"Because we will stop working with people who don't," he said. "The winning suppliers can do more than hold the line on cost -- they will attack it."
One key goal is to capitalize on innovation.
"There's a tremendous amount of potential energy in various institutions in the military and within industry," he said.
One of his plans at the conference is to walk around and spot some of those latest innovations on the exhibit floor that will help keep the forces ready.
"Part of our challenge is we can't spread readiness cuts like peanut butter. We have to keep units deploying to the current fight in Afghanistan," Winnefeld said.
It may initially seem like the department is crying wolf, he said, with carriers set to deploy in the near future.
"You may not see global impact until late this year or early next year," he said.
Forces deploying soonest are already ready, but there are many forces that may not be able to start training.
"They will be on the sidelines, grounded, tied to the pier and not able to deploy if they don't have the proper resources to make them ready to let them go," he said.
A domestic impact will be evident in the near future, however.
Those include canceled maintenance availabilities for up to 30 ships this year, reductions in aviation depots, 46,000 layoffs of temporary DoD employees and hiring freezes.
"We hire about 2,000 people a week in the DoD," he noted.
Worse, there may be furloughs soon announced that would affect the "vast majority" of the 800,000 DoD civilians.
"The furloughs, which we really don't want to have to do, amount to only one-ninth of solving the problem we will have if sequestration does not go away," Winnefeld said.
That means tending to $5 billion of a $46 billion problem, he said.
"We are working through what the other eight-ninths is. I hope to have an answer in the next few weeks," he said. "If readiness drops, we can't be in the real world doing things to protect national security interests."
The theme of the 2013 AFCEA West conference is "rebalancing the Pacific."
Don't call it a pivot, Winnefeld said.
"The term 'pivot' is both overused and incorrect because it implies we'd turn completely away from other regions," he said. "Or it implies something happening quickly, but it will take time to rebalance."
Related video: AFCEA/USNI West 2013 from the exhibitor floor