"British MoD acquisition/procurement and support organization may be privatised"...

[Stratofreighter]

U.K. MoD Eyes Privatized Acquisition

Jul. 21, 2012 - 10:48AM

Britain’s Ministry of Defence could run a competition to outsource its 14
billion pound ($22 billion) annual procurement and support organization as early
as 2013, according to the country’s minister for armed forces.

The possible 2013 competition to partially privatize the Defence Equipment
and Support (DE&S) organization is expected to attract some of the world’s
largest program management companies.

U.K. MoD Eyes Privatized Acquisition | Defense News | defensenews.com (http://www.defensenews.com/article/20120721/DEFREG01/307210001/U-K-MoD-Eyes-Privatized-Acquisition?odyssey=tab|topnews|text|FRONTPAGE) has more...

[airborne_artist]

Are G4S allowed to bid? :}

[Stuff]

Not sure how this can work, someone clever than me is going to have to explain how companies like KBR can be the ones running procurement (which includes arranging a through-life support solution) when they also bid for the support contracts?

I only pick on KBR because I happen to know they have a major stake in BRAMA who service the Hawks at Valley, the other companies are probably in a similar situation.

Won't we be in the situation where we pay money to a private company in order to run the organisation that then gives their own subsidiaries the most profitable contracts?

[tucumseh]

Any one notice how Gray has changed his terminology since announcing this on radio just after Xmas? In December he used phrases and terminology that could only have been lifted from one source - an airworthiness Standard scrapped over 3 years ago. When queried over his by an MP, Gray's office denied he spoke the words, despite the radio interview being there for all to hear.

But what ever way he dresses it up, it is part mandated policy, and part an adaptation/extension of existing practice.

I hope he isn't getting paid too much to read old policies and present them as his own.:E

[Fox3WheresMyBanana]

Civil Service procurement doesn't work because nobody is actually accountable for failure to perform.
Privatisation won't work because profit is far more important than performance.

I vote for putting the military in charge of their own procurement. Have a management staff course, how to write a contract etc., one year (make it count as an MBA) for Officers who have a talent for it.
CDS bashes heads and has a staff who look for Tri-Service options.

Thoughts?

[salad-dodger]

I vote for putting the military in charge of their own procurement. Have a management staff course, how to write a contract etc., one year (make it count as an MBA) for Officers who have a talent for it.
Great idea. What will it be: one year MBA, two years in post learning how to do the job and then, once starting to become proficient, move on to be OC MEGS/MT/VASS? Should work a treat.

S-D (not a CS btw)

[Jimlad1]

Why oh why oh why does someone being in the military automatically mean that they will be an excellent procurement and project manager?

The problem isn't that someone doesnt wear a uniform, its a combination of rapid posting of military personnel, insufficient staff training for CS, massive political indecision making in London, an inability to secure the correct funding, coupled with an overoptimistic attitude to budget growth by planners, and an inability of seniors in uniform to take tough decisions in a timely manner which may help solve matters.

The problems of procurement failure are numerous, and the military is as guilty as the CS in messing things up, but far better at pretending that a big boy did it and then ran away...

[tucumseh]

Civil Service procurement doesn't work because nobody is actually accountable for failure to perform.
In theory, they are accountable. In certain contracts, for example anything requiring an airworthiness signature, the individual is NAMED, as opposed to his/her post title.

In the first instance, extend this system to every type of contract.

Then implement the regulations and actually hold them accountable.

Chinook HC Mk3 is a classic example. The Public Accounts Committee raged about the waste, blaming "lack of Management oversight". But then claimed MoD could not tell them who was meant to provide this oversight, and there was no means of finding out.

This was crap, and they were told so. The answer was laid down, in this case in Directorate Management Plan, approved by the very person with "management oversight", DGAS2. That is, it was his primary role to validate the programme Risk Register and personally assess the top 10 each month. Ask any Risk Manager under him how often he did this.

The same DG had a long history of dismissing any attempts to avoid wasting money with "of no concern to MoD(PE)". His formal position on Risk Management was; By all means record the risk, but if you dare try to mitigate it, watch out. This nonsense was formally taught to MoD entrants during his tenure, and the ethos remains to this day; although to be fair to the likes of the MAA I believe this penny has dropped with them. But elsewhere, you only have to look at the DE&S family tree to see that the people meant to be overseeing this, and imparting knowledge from a "centre of excellence" are in fact the worst exponents.

The solution is the same as for most things discussed here. Implement the regs. And sack those who refuse. As matters stand, it remains a disciplinary offence in MoD to implement the regulations designed to avoid waste.


Edited to add, in case you didn't already know; same DG - Nimrod MRA4.

[Not_a_boffin]

It isn't exclusively the CS and it isn't exclusively ABW either. For those who read it, the Gray report was a bit of a curate's egg. Some good ideas, but an awful lot of "here's the solution, let's find a way to make it fit".

There are undoubtedly some people in ABW whose giveaf8ckometer is hard-wired to zero. For every one of those people I've come across, there is also at least usually more one whose meter is pegged at 11. In the middle are an awful lot of people doing the best they can - whether that's good enough or not is a different question.

A huge amount of emb8ggerance is/was generated by the Planning Rounds, where people in town (MB) in general moved programmes and money around to fit an annual budget line, usually with no idea of what this did to cost escalation, programme risk, OC and morale.

One Maritime IPT got through Initial Gate - which should have been cause for wild celebration, whereupon the IPTL was told that the Assessment Phase funding had been cut to one third of that required, largely because the RDEL amount didn't fit the EP silt chart budget line. Told to get on with it and not to worry about slippage - but to try not to let it happen!

[salad-dodger]

There are undoubtedly some people in ABW whose giveaf8ckometer is hard-wired to zero.
that is classic, and so true!

S-D

[Fox3WheresMyBanana]

Thanks for the feedback.

I don't assume everyone in the military will be good at it.

I think the US model is good. Put someone in post for long enough to get good at it - 7 years? Promote them if they do well. The US are prepared to have a Brigadier General with only two staff if that's what the person has earned but the project hasn't reached the 'big staff' stage yet. It has to be a worthwhile career move. Make the rank Acting if the results can't be assessed yet. Put 'em back down to whatever if it turns out they failed.

The military tend to be better at sacking incompetents, but admittedly not by much.

Ultimately though it will mean that, with less agencies, accountability is easier to pin down. And since we don't want the CS doing the fighting, that means the military doing the procuring.

Final point. We would probably be better off if the VSOs had the balls to tell Government that funding affects capability. I would suggest that the Government publishes a list of foreign policy objectives - in secret to the Commons Defence Committee if necessary - and the CDS reports on what the Armed Forces can achieve with the budget provided.

[JFZ90]

As hinted above, the scope for a massive conflict of interest is enormous.

Hopefully someone will realise that this could make all previous procurement errors pale into insignificance. Any regrets over particular PFI inflexibility or VFM issues could be made to look trivial....

[Chugalug2]

tuc:
...implement the regulations and actually hold them accountable...
That is so true and so conspicuous by its absence.
F3WMB:
The military tend to be better at sacking incompetents, but admittedly not by much.
Better that who? I wouldn't even take much comfort from your qualification. The people who oversaw the deconstruction of the UK Military Airworthiness System were Military, RAF VSOs in fact. They are all honourable men evidently...

[pr00ne]

This could be a contractual bun fight to beat ALL contractual bun fights! As the global defence sector continues to consolidate the number of companies large and complex enough to provide such a service shrinks accordingly, and by their very definition they will be amongst the major providers of goods and services to MoD.



Stuff.

BRAMA haven't been involved in Hawk work at Valley for a long time now, they lost the contract some years ago. Babcock Defence Services are the current provider.

[Stuff]

Fair enough, it's been a while since I passed though 208/19 but the point still stands. Can we not end up in the situation where we pay someone to award themselves with our procurement and support contracts?

[tucumseh]

insufficient staff training for CS

While true, I think you miss the point.

When I joined MoD(PE) as a project manager, it was my 6th grade as a Civil Servant. I'd managed projects in two of the previous grades and been an HQ "Staff Officer" in another (posts since Militarised at SO2 level). Some years later, after well over 100 projects, all delivered to at least Time, Cost and Performance, I was still regarded as inexperienced in that 6th grade because ELINT was missing from my cv. My annual report was very specific. Only after doing that on Nimrod R (before/during/after GW1) was I deemed fitted for promotion. Every single day of my career I drew on my experiences from those first 5 grades. The teaching I received from my seniors, who actually thought I was a young inexperienced whippersnapper when well past 100 projects, was invaluable.

Today, that 6th grade is the first grade for direct entrants. They are never required to demonstrate any of the competencies myself and my colleagues gained in the previous 5 grades. To compound matters, there is no one left to pass on practical experience.

MoD can never recover that situation. Gray's proposals are the right thing to do, but for all the wrong reasons. Because what I describe will never be acknowledged openly by MoD, the same lunatics will be running the assylum, but this time getting paid double working for the companies who do the "CO" part of GOCO.

I mention the above because I agree with Jim. Being Military does not guarantee competence in procurement. Not by a long shot. Look at the procurement disasters everyone bangs on about. Study the personnel. I know most of them. Do you? The DG I mentioned above was a CS. But his boss, who approved everything he did, was a former Admiral. The airworthiness debacle, which has the deliberate waste of hundreds of millions per year, year on year, at its root, was led by senior RAF officers. The threats of dismissal for refusing to waste money were instigated by an RAF AVM, supported by an ACM. (Sorry, bit of duplication there; the ACM was also the RAF Chief Engineer who scrapped the airworthiness system).

This isn't an anti-Service rant; just an observation that it isn't as simple as "get shot of the CS".

[pr00ne]

Stuff,

Theoretically yes, but in practice no. Contract law and Public Procurement Law would prevent it for a start. But, there will have to be some rather quickly erected Chinese walls if some of the usual suspects are, as I suspect that they will be, amongst the bidders.

[Easy Street]

Watching recorded coverage of Defence Questions on BBC Parliament the other evening (yes, I was very bored), it struck me that nearly half of the alloted time was spent debating UK defence industry matters. An awful lot of "jobs in my constituency this" and "training of skilled engineers that". It struck me that most of that discussion should have been addressed to the Business rather than the Defence ministers. Wouldn't we avoid a lot of our standard pitfalls if the MOD simply tried to buy the best it could for its money, while UK industry (separately) did its best to ensure that that meant choosing a British product? Having the MOD as poacher and gamekeeper has patently not been working.

[Chugalug2]

ES
Having the MOD as poacher and gamekeeper has patently not been working.
'Ere, 'Ere,'Ere!. Waving of Order Papers, prolonged waving of Order Papers. "Order Order, Order", from the Speaker drowned in increasing uproar. Sitting suspended!
Which is precisely where Airworthiness went wrong. An Airworthiness Authority MUST be independent of the Operators. An Air Accident Investigation Authority MUST be independent of the Operators. Both MUST be independent of each other, or people die! People have died because the MOD is Poacher and Gamekeeper!
Self Regulation Does Not Work and in Aviation it Kills!

[salad-dodger]

Not disagreeing chuggaluggers, but don't lets divert the thread onto your one and only topic.

Let's keep it to procurement.

S-D

[Chugalug2]

Well let's keep it to the supposed superiority of Military Staff over CS Staff that permeates the thread, s-d. Tuc spells out his credentials and I spell out the actions of VSOs. Both of us ignored, other than for me to be accused of thread drift.
There is a tendency for self delusion here that does not bode well for the future of the MOD whether it be acquiring, procuring, regulating or investigating. It can't do any of those things and should most certainly not be doing the latter two.
The MOD is the problem and always will be, both for the Nation's Defence and for the Armed Forces. I don't know what can be done about that, but something needs to. I do know what should be done about UK Military Airworthiness and Air Accident Investigation. That is why it is my "one and only topic" as you so charmingly put it.

[JFZ90]

It is not exactly clear what benefit (other than being able to sack people) having a contractor running the show will make. Will they novate contracts such as FSTA over to them? What will they do - 'improve' the contract, or manage it in the same way as now? What exactly will change? Will the management be 'better'? What does that mean? Will they discover magic efficiencies the current team are unaware of due to their "business acumen"? Its nonsense isn't it? No doubt many will recall tales of 'consultants' coming in to help projects and see that more often than not provide little or no insight that isn't obvious to the CS/Mil already employed - or infact they merely regurgitate ideas they pick from the team. The real issues are usually with the control of funding, reqt mgt & change and the interface with MB.

I do wonder how on earth the interface between MoD and a GOCO would work in practice - how many requirements would e.g. MoD control over the GOCO on a typical aircraft programme? A few KURs or a proper technical spec including intelligent application of reglations? Who is going to administer that properly with the GOCO? What is the scale of effort to be retained in MoD? Will it be much smaller than todays PT? Won't the GOCO need a PT around the same size as the DE&S PT (adding duplication) - plus they will be being paid more? Noting the "hardwired to zero" types that we've all met - surely there isn't a consensus that PTs are 'overmanned'?!?!?

It all seems to add up to less and less money available for the end user, and more and more lining the pockets of middle men.

[Rigga]

I'm not sure the problem is with "Who" does it rather than "what" is done.

The main issue is that, over the last few years, almost everything in MOD has been dismantled with no thought towards cause and effect. It's all about price and not about value.

Its very easy in hindsight to say that there was no plan to begin with, but - however its wrapped - there is no coherent plan now!

[Fox3WheresMyBanana]

Can I ask one question?

What happens to the CS/mil/private company guy who will be responsible for any future debacles?

And the guy/committee who appointed him/her?

On previous/current experience, nothing. I think that's the real problem.

May I suggest that whoever is responsible in future has a better carrot/stick arrangement than we have at present. This will need to be better than the current grade of "targets met = bonus"

[Chugalug2]

F3WMB:
What happens to the VSO/CS/mil/private company guy who will be responsible for any future debacles?...On previous/current experience, nothing. I think that's the real problem.
Subject to a very minor modification to your post, it seems that we are in violent agreement now.

[tucumseh]

Chug is quite right to raise the independent MAA issue. It is not thre4ad drift on a thread essentially discussing funding and how it is (mis)spent.

The gross and deliberate waste of money, which led to the "black hole" and hence the problems being discussed here, is also what caused the airworthiness failings. All these issues are inextricably linked. Not to appreciate that is to be as badly stove-piped as MoD.

Nor do most here appreciate the simple fact that both "sides" are actually complaining about the actions of the same few VSOs. Chug does.

[tucumseh]

I know we bang on about the appalling behaviour of VSOs and senior CSs on these threads, but I’m not blind to the fact they were once juniors; and some were even competent.


At what point does a hitherto sensible, competent and honest man decide to needlessly sacrifice men and money? It has got to be the “system” that produces them that bears much of the blame.



My own view has always been that once you reach 2 Star level you are a protected species. Also, said 2 Stars identify their successors at an early stage and they, too, become protected. These people are not only protected by being able (and encouraged) to blame those below them, but also from above. Sometimes rising stars are singled out because they are genuinely excellent. Too often it is because they share a club membership with the 2 Star. Almost always they are rejected if they demonstrate competence. In MoD(PE)/DPA/DLO/DE&S it is has always been well known that if you deliver to Time, Cost and Performance, the attitude of VSOs is that you are raising the bar to an unwelcome level and drawing attention to the fact T/C/P can be achieved (with the correct training and background). That is not just my opinion, but was routinely annotated in “Career Guidance Panels”. You were instructed to be less competent, and in the aircraft world that meant sacrificing safety.

One of the most basic rules of procurement (and acquisition) is that of independent scrutiny. It is the mandated means by which you avoid, as far as possible, waste. Suffice to say, it has been an offence in MoD for 20 years to implement these mandated rules. (December 1992, Director General Support Management – an RAF AVM immediately under the RAF Chief Engineer – ruled it a sacking offence. 5 successive Mins(AF) have now upheld it as a disciplinary offence, although they stopped short of sacking). Why? It is a bullying management tactic to hide their own failings. If you conduct scrutiny properly, it highlights the deliberate waste. My first suggestion is there should be robust implementation of these scrutiny regulations. (A recommendation made to PUS in June 1996 by MoD’s own Director Internal Audit, and rejected. Implementing recommendation #13 in that report would have nipped all airworthiness failings in the bud).

But the rules don’t require independent oversight at a level close enough to the decision making. As I described above, the oversight comes from people who have a vested interest in meeting Time and Cost targets, and it is stated policy to sacrifice performance to meet these. However, and this is close to my heart because I worked in the system and lost friends in accidents, “performance” includes safety and the decision of, especially, the RAF Chief Engineer in the early/mid 90s and his 2/4 Star opposites in PE to cross that line and knowingly sacrifice safety so their books balanced was reprehensible and criminal. It was a double whammy, because it only served to conceal the underlying failures until, conveniently, they had retired. Once there was no more airworthiness funding to slash, the basic problem could no longer be concealed – their polices continued to waste money and there was nowhere left to hide. If you don’t like me saying “airworthiness”, substitute “procurement”. Amounts to the same.

My second suggestion is that Gray uses this forthcoming restructuring to introduce robust independent scrutiny. He should employ people who no longer have a vested interest, either in monetary or career terms. Despite my ramblings about certain VSOs and SCSs, most are supremely competent. I’d employ them to police the system. Beware the man who has nothing left to lose.

[Rigga]

For the last 15 years I have worked in QA and Continued Airworthiness starting in the RAF and then in a variety of quite different aircraft maintenance and management "organisations" (some are not organised).

In ALL these organisations the same rule for QA/CA applies:
Nobody believes the internal company report is worth doing anything about - or that the QA guy's worries are just nit-picking pedantism.

If QA want some movement in a particular issue they will probably tell the next external audit team (and sometimes a regulatory authority) - for them to find the issue in their reports. If an external audit (or regulatory authority) finds the issue - something MAY get done.

The same principle applies to the MAA, and probably to the MAAIB too. There will be very little incriminating evidence from internal investigations and any possible incrimination will not be published in public records.

That is not to say that there will never be a case brought to some form of Trial - in all deep MOD rule-changes there has always been one show-case to show that the rules work and that there is no sham, but none afterwards...

If this principle is applied to the procurement system I can't imagine the potential for smoke, mirrors, missappropriation and abuse.

[Chugalug2]

A humble Amen to all that you say, tucumseh. What you describe is a corrupt and criminal system.
Just as you say, it is the system that is corrupt and there are always those who are so weak as to be corrupted by it. You also say, and I agree wholeheartedly, that there are many, indeed the vast majority, who fight against the corruption and do the best that they can for the Nation's Security, for the Armed Forces, and for their own Moral Values. Many are VSOs and again I fully concur. But, and here's the rub, the corruption goes unacknowledged, here as well as elsewhere. Those morally weak and incompetent VSOs that have cost us so much in blood and treasure, as denounced by you tuc, go uninvestigated, unchallenged, and unpunished. Indeed, the trinkets and titles of the "honours" system are heaped upon them instead. Others lower down the food chain, outside of the 2*+ firmament that you so rightly describe, are offered as sacrificial goats in their place. That is no way to run a Town Council let alone a major Department of State!
It seems the default choice is to knowingly let such a scandalous system continue, all for the want of challenging it. Why? Because a VSO was once a good egg at running a Squadron, a Station, even a Group? Absolute power corrupts absolutely. Being above the law, protected by others, and choosing your own successor is absolutely corrupt in my view, never mind the additional cost of your own incompetence, Sir!
The other eternal truth is;
All that is necessary for evil to triumph is for good men to do nothing
There is a lot of nothing going on, I think.