3 The Department's initiatives to
improve acquisition performance
14. The Enabling Acquisition Change Study of June
2006 recommended significant cultural and organisational changes
in the Department in order to focus on the affordability of equipment
throughout its life, and not just at initial acquisition. One
major change was the merging of the Defence Logistics Organisation
and Defence Procurement Agency on 1 April 2007 to form the Defence
Equipment and Support organisation. The Department also intends
to develop metrics to demonstrate the through-life performance
of equipment, both in terms of value and support costs. The first
independently verified report on performance should be available
for Parliamentary scrutiny from 1 April 2008.17[17]
In preparation for this merger, the Chiefs of Defence Logistics
and Defence Procurement have been co-operating on a "Joint
Working Initiative". They have emphasised to staff that team
leaders are as accountable for the future programme of in-service
support as they are for the initial acquisition phase.18[18]
15. Successful management of personnel will be key
to the new organisation's success. Lack of continuity of staff
in post has hampered the Department in the past in its efforts
to achieve a consistent standard of performance in the delivery
of its projects. There has been a particular problem at the middle
management level (Band B and C grades) where up until now personnel
have changed jobs upon promotion. The Department is putting new
arrangements in place to slow down staff turnover. Time in post
for newly selected Integrated Project Team Leaders will be tied
to the delivery of key project milestones, and there will be more
management control over staff moves to prevent those which are
not in the wider corporate interest. The Department intends to
permit promotion in post to reward good performance, therefore
retaining vital continuity in key roles at crucial stages of the
projects.19[19]
16. Relatively few project managers have been held
responsible for poor project delivery and removed from post as
a consequence. The Department's view is that many cost overruns
have resulted from decisions taken collectively within the Ministry
of Defence, rather than by individual team leaders, and therefore
it considers it unfair to hold them responsible. It has, however,
removed an average of three project managers a year over the last
four years, with a number of underperforming team leaders being
invited to retrain for more suitable posts, something the Department
believes has not always happened in the past in the public sector.
Tighter accountability, as well as more appropriate rewards for
success, will be central to the personnel management arrangements
in the new Defence Equipment and Support organisation.20[20]
17. The Department increasingly delivers projects
through a partnership approach and works with a wide range of
suppliers. In doing so, it needs to understand the performance
of its key suppliers and use this information to inform its decision
making. Since 2004, the Department has collected, project by project,
perception-based data on how supplier performance compares against
its contractual obligations. It also collects data on interaction
with industry, for example if a supplier keeps the Department
informed of emerging bad news. The Department is increasingly
using this data to risk adjust bids for new programmes, particularly
if suppliers have a history of under bidding to win contracts.
Each company is aware of its own scores and its overall ranking
relative to other unnamed key suppliers.21[21]
1 17 7 Qq 37, 90-91 Back
1 18 8
Q 38 Back
1 19 9
Qq 24, 39-40 Back
2 20 0
Qq 38, 84, 92-93 Back
2 21 1
Qq 125-126; Ev 22 Back
|
