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Sustainment Management in the Royal Australian Navy

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Sustainment Management in the Royal Australian Navy Transdisciplinary Lifecycle Analysis of Systems 249 R. Curran et al. (Eds.) © 2015 The authors and IOS Press. This article is published online with Open Access by IOS Press and distributed under the terms of the Creative Commons Attribution Non-Commercial License. doi:10.3233/978-1-61499-544-9-249 Sustainment Management in the Royal Australian Navy a,1 b Robert HENRY and Cees BIL a BAE Systems Australia, Hydrographic In Service Support, Cairns, QLD 4870, Australia b School of Aerospace, Mechanical and Manufacturing Engineering, RMIT University, Melbourne, VIC 3001, Australia Abstract. The Australian Defence Force (ADF) like many industries faces ongoing challenges in the support of their assets, acquisitions, budgets and workforce management. Unlike other industries, the ADF is heavily affected by changes in Government, changes in Government policy direction, diversity of potential conflict scenarios and the manner in which budgets are set. This has led to a series of decisions being made that have addressed problems in the short term but have not adequately considered long term implications. More often than not, Government directives to deliver improved efficiencies come along with a corresponding budget cut, a direction to maintain services and capability without any real guidance on how this could or should be achieved and this continues to impact on the organisation long after the incumbent Government has left office. Resultant problem areas within the ADF maritime such as engineering and maintenance are covered by a number of Reports including the more recent Rizzo Report. The purpose of this paper is to look at the area of Sustainment Management within the ADF from a maritime perspective and the holistic view that defence industries need to consider in the development of their Support Solutions when entering into support arrangements such as Alliances and In- Service Support contracts. Keywords. sustainment management, maintenance, Royal Australian Navy Introduction Many large organisations face continued pressures to ensure maximum plant up-time and availability while reducing support costs; the Australian Defence Force (ADF) and their prescribed supplier the Defence Materiel Organisation (DMO) are no different in this regard. The strategies implemented are very dependent on a range of factors including competition, quality and level of available data for analysis, desire for change, organisational culture, organisational structure, finances, change management practices within organisations, politics and many others. These factors have a heavy influence on outcomes and generally are not easily changed [1]. The Rizzo Reform Team has identified that to affect the required cultural changes necessary to improve engineering 1 Robert Henry, Maintenance Manager, Hydrographic In Service Support, BAE Systems Australia, Cairns, QLD 4870, Australia. Email: [email protected] 250 R. Henry and C. Bil / Sustainment Management in the Royal Australian Navy outcomes within the Royal Australian Navy (RAN) is expected to take a generation dependent on the consistency of approach. Organisations may have a dominate engineering functional basis, have a heavy plant asset base or have little in the way of primary plant but all have an operational focus of some description. Balancing these apparent apposing requirements can often be difficult and is made more complex when the organisations prime objectives are not made the centre piece of each department’s objectives and managed with an overarching coordinated approach [2]. Within the ADF, staff retention, staff mobility and costs of training add considerable cost and complexity to this issue which has had negative impacts to engineering management within the RAN as identified by the Rizzo Report [3]. Since the late 1990’s, the Australian Defence Organisation (ADO) has continued its shift from self-reliance to ever greater levels of industry support where its functions have been deemed not part of the core business of war-fighting or not considered frontline support services required to support this purpose. This fundamental shift saw the introduction of Class Logistics Organisations later named System Program Offices (SPOs) that were focused on specific asset classes and often partnered with an industry service provider. This model has continued to develop and evolve gaining greater pace when the DMO was created in 2000 as a statutory independent organisation and prescribed supplier to Defence. The original model was supposed to retain military and Australian Public Service (APS) personnel in executive, finance, engineering and governance roles with industry partners providing the leg work to be brought in as required to meet project needs. This concept was supposed to allow for the flexible resizing of the organisation to support the varying work load. Unfortunately, this vision failed to be realised resulting in inefficient and costly structures. In more recent times primarily due to budget pressures, freezes on recruitment and other Government reviews into staffing levels of public servants, the original concept is likely to gain greater traction. The process of outsourcing services has come at a cost to the ADO as a whole through the effective deskilling of critical engineering functions as identified in a number of Reports including the more recent Rizzo Report [3]. An article appearing in the Australian Defence Magazine has gone further in revealing that the Commission of Audit review into government programs identified that the DMO has not been effective or enhanced accountability due to a range of skills shortages and high staff turnover [4]. Interestingly, this was highlighted in the Mortimer Review with a range of recommendations made to improve commercial practices, skills, risk management and workforce numbers [5]. What does this mean to defence industries? The obvious answer is a possible business opportunity but a discussion of business opportunities or how to win them is not part of this paper. The more likely answer is that defence industry may be asked to take on responsibility beyond the traditional supplier of materials and services. As discussed in an editorial article titled Time to let go of the Valley of Death and make a decision, many defence related industries have focused on a relatively narrow part of the spectrum and have primarily been concerned with acquisition and construction projects calling on the Government to provide certainty for the Australian Defence shipbuilding program in order to maintain skills [6]. While this maintains a large workforce with a range of skills that may not be easy to pull together again at short notice, the notion that it maintains a highly skilled work force that would somehow irrecoverably disperse is questionable. R. Henry and C. Bil / Sustainment Management in the Royal Australian Navy 251 Most of the skills needed in the bulk construction phases of shipbuilding are transferable between Defence and commercial work and are also required to support the maintenance and modification programs that are largely performed in-country. Specifically, the areas often cited as a concern for skills retention in the ship builder sector are more related to maintaining employment opportunities rather than skills retention. Additionally, the skills that are valuable for retention including engineering for systems integrations continue to be required in support modification programs and high end technical skills that are required to support the vessels past the build phase. From the author’s direct experience over the last 20 years, the most difficult skills to retain and replicate from Sustainment perspective are those related to complex systems diagnostics and field repairs of military systems/equipment which up until the last decade or so largely originated from within defence due to the lack of commercial equivalent training. Generally, reviews into Defence have focused on the performance of either a single service, DMO or the partnership. These reviews have placed many of the engineering and sustainment performance problems squarely at the feet of the ADO. This may be valid when considering the performance of the governance function and commercial acumen but industry also needs to stand up and be counted in underperforming. From the author’s experience of being on both sides of the fence, it is evident that the base problems affecting the ADO are equally applicable to industry in Sustainment support of military systems / equipment. What are these shortcomings and are they easily addressable? 1. Problem Description Under pressure to reduce manning levels on board Her Majesties Australian Ships as this represents the single biggest cost of running a Naval vessel, the RAN began requesting replacement vessels that were considered to be minimum manned in line with commercial shipping trends. New vessels have more automated control and equipment requiring less routine maintenance to be performed while at sea requiring a smaller highly skilled technical workforce as part of the crew. This shifted the focus from providing engineering, technicians and tradesmen as a significant crew component to one of addressing the core operational requirements of war-fighting and seamanship in line with RANs mission statement of “to fight and win at sea”. One aspect of this approach was to distribute the function normally handled by a “whole of ship” maintenance planning cell amongst various “Work Centres”. The term Work Centre came about in response
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