a monopsonistic environment – we are the dominate customer
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Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Major Fleet UnitsShip Repair & Maintenance Reform
Group Maintenance Contracts
Strengthening Partnerships with the Maritime Industry
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Williamstown Dockyard …………… sold 1985Cockatoo Dockyard ……………… closed 1992Garden Island Dockyard ………… privatised 1999
Australian Submarine Corporation …….… to be sold ??
From owning all the means to maintain our charges… to owning none …
A monopsonistic environment – we are the dominate customer
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
An Industry that is dominated by a small number of primes (system integration and steel fabrication)
supported by a large number of SME sub-contractors and a few sophisticated electronic system houses; all
heavily reliant on OEMs
We had created ….
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
A work-package preparation schedule that ensures an incomplete Statement of Work and …
Project Management ‘shells’ having transient SME’s sub-contracting their services to the successful tenderer
No longevity, No predictability, No stability
An Industry more attuned to the preparation of tender responses than to the
preparation of the repair and maintenance activity being tendered for
By arms-length fixed-price induced competition within a highly restricted market we had created …
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Creating an Industry environment of ...
false competition in which ‘primes’ are reliant on a common group of OEMs and agents
short-term cost drivers = under-bidding, play-down risk, unachievable schedules, find profit in growth
no security of tenure, no predictability of effort to plan against
the shedding of permanent trades, subrogation of work-force training and skill sustainment
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Extract from the RIZZO REVIEW
Short term, individual contracts for the conduct of External Maintenance are resource intensive and fail to foster Industry
investment. (p 23)
Strengthen Partnerships with Industry
Whilst retaining competitive tension, the Defence Materiel Organisation should implement maritime contracts that are broader in scope and longer in term, to build deeper and continuing relationships with Industry.
(Recommendation 5)
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
While Navy was increasingly influenced by….
provision of greater-depth ‘Parent Navy’ support
diminishing in-house and Navy skill base – Intermediate Level Maintenance no longer exists, organic maintenance deficits
increasing Operational Tempo of Fleet Operations – higher-than-designed usage rates
shorter technology life-cycles and rolling supportability management programs
people & safety-centric initiatives (SKT, WHS) requiring a more mature relationship with Industry
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
A new grouped asset long-term, performance-based contracting methodology for the repair and maintenance of the Navy’s major fleet units. It was anticipated that this initiative will provide:
• Industry with increased certainty of work (promoting stability and security of tenure), a commonality of contract/expectation, and a manageable and predictable level of effort that it can plan against and deliver efficiencies from;
• Navy with better notice to ships’ crews of the planned location of maintenance and maintenance patterns.
Major Fleet UnitsShip Repair & Maintenance
Reform Initiative
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
What we needed:A move away from throughput-based profit making towards efficiency-based profit making (the learning organisation, increased innovation, creativity, conditioned-based maintenance, pre-refit assessment, and the challenging of norms – less is more)
• Greater predictability of work-effort, refit location, and overall ship availability (challenging the current usage upkeep paradigms and practices, no compromise to safety/availability)
• Greater certainty of maintenance duration/completion through programming flexibility, use of windows-of-opportunity
• Greater stability to encourage the investment in strategic skill-sets, equipment and facilities (to be a partner rewarded through performance and efficiency)
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
GroupingsGroupings
Group 1 Amphib & Afloat Support Ships (now only HMA Ships Tobruk and Success)
Group 2 4 x Adelaide Class FFGs
In contract 28 May 2014 with Thales Australia
Group 3 8 x ANZAC Class FFHs
In contract 23 May 2012 with Naval Ship Management (Australia)
a joint venture between Babcock/UGL,
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Perform Supportability
Analysis
Develop Engineering
Changes
Invest in Inventory
Perform Maintenance
Incorporate Engineering
Changes
Supportability
URDEFs – Quantity – Days – Stores
EMA – Timeliness– Quality– Budget Achievement– Post-Availability Report– Feedback– Trials
Type C Contract Feedback
Condition Monitoring Results
Condition Assessment Results
Inventory – Consumption– Issues– Repairs– Procurement– Obsolescence– Demand Satisfaction
Support Costs
Availability
Sustainability
Integrated Material Support / ASIPA
GMC ContractorEngineering Support
Maintenance Support
Supply Support
Outcome IndicatorsOutcomesImplement
Design & DevelopAnalyse
Develop Inventory
Investment Plan
Develop Work Package
WI / MWL / TML
Type C Contracts
MTU Diesels, Thales Underwater Systems
etc …
OEMs & in-country
agencies
ANZAC Assumption Model
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Within the first 3 months
• Reductions in Growth
• Real Cost Savings
• Rewarding Efficiency
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Over the proceeding 18 months
• Better understanding of the maintenance liability
• On time delivery of ships out of maintenance
• Enhancement of work instructions
• Data remediation and improved data integrity
• Earlier ordering & staging of GFE / CFE
• Better & more reliable scheduling and planning
• Better responsiveness in meeting the unforeseen
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Base-level Benefits
• Increased performance (productivity)
• Priority adaptability and responsiveness
• Customer environmental awareness and sensitivity
Higher Level Benefits
• Investment in long-term planning
• Workforce skill-set development / Infrastructure investment
• Stability and predictability
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
12.18 Defence will build upon the success of …mutually beneficial contracting arrangements. This includes appropriate use of measures such as collaborative contracting structures for acquisition projects, …,
performance incentives, rolling wave contracts and group maintenance arrangements for sustainment work.
These will continue to form the basis of Defence’s commercial partnership with industry and deliver better value for money for the Commonwealth and industry.
Working together with Navy and Industry as an innovative team we provide Seaworthy warships for our Nation
Questions ?Questions ?
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