Increasing Pace in Defence Acquisition

A short blip from the D Group

I was invited to speak at the D Group earlier this week on “Increasing Pace in Defence Acquisition”. It is a fun format which engages all of the guests to challenge each other on our experiences, expertise and what each of us might do to contribute to better defence procurement.

Here are the points I made:

Pace is not the problem in procurement, in fact it is misleading when we use it as the problem when we fail to field novel capabilities across the enterprise. The commercial architecture exists to buy what we want, when we want. CommercialX proves this; they did not develop new authorities or commercial vehicles; they developed a different mindset. I argue we have made two big mistakes when we think about procurement:

1. We consistently overlook the critical asset of procurement, its workforce. With just over 2100 people in the MoD commercial workforce, spending around £18B a year, we instead favour the pursuit of novel technologies over the investment in those that can quickly procure those technologies and how we might encourage them to be creative, agile and fast.

2. We have forgotten our fundamental roles of the MoD customer as the expert in the problem and industry as the expert in the technology, R&D and product development. Industry’s hubris is it believes they are both the expert in the problem and the solution, relegating the customer to that of a spectator – not the star player. I argue this misalignment of roles has a cascading effect into procurement, causing needless friction.

We seem to have also made procurement an outcome, versus the process by which we deliver outcomes. The way we currently focus on procurement as a problem prohibits us from take a wider view of what enables procurement to reach outcomes: requirements. Instead, we have seen investment in procurement reform which when you take a meta view, fixes annoyances such as an easier website to navigate, not have submitting duplicate forms, etc.. No company has not bid for a contract because it takes their team longer to submit the bid, they do not bid because they cannot either 1) find anyone to talk to in order to understand the problem, 2) understand the language of the requirement, and 3) what the long-term opportunity of the problem is. What we procure matters more than pace, if we are simply buying the wrong thing but faster we are still the idiots. This is why requirements matter more than procurement. Better requirements mean better procurement pathways mean better outcomes.

Here is what I am observing/hearing on the MoD side of things:

1. Our customers (MoD) want modular capabilities, they do not want to buy or be constrained by full stacks. They want flexibility to apply their expertise of the problem to the solution.

2. They want – I think we want too – forums to learn what industry thinks about the problem before they want to know about available solutions. Without business development / account managers in the room.

3. They want the demand signal from industry for user feedback to enable them to transition lessons learned from Ukraine into an onboarding process for new and novel technologies. How might we interact with companies and products to provide user feedback to make a better product from the outset? Without industry collectively signalling for this, it makes it harder for the MoD to integrate into a procurement process.

4. They see future capabilities as: interoperable, interchangeable, integrated and adaptable.

5. Ukraine will trend the MoD to start ups, scale ups and SMEs for their nimbleness, (usually) best technological talent, and ability to pivot, shifting away from Primes.

Finally, we wrapped the discussion up with how might we pivot to sovereign supply chains and sovereign capabilities at a time when our traditional allies feel less traditional? We didn’t get into big answers on that… next time!