Rizzo Reform Program

What are we going to Achieve?

CDRE Mark PURCELL, RAN

Head Rizzo Reform Program

Rizzo Reform Program

The Vision: ‘A rebuilt and redesigned effective Maritime Capability Management & Technical Integrity Assurance System that drives seaworthiness and preparedness.’

Rizzo is an opportunity for Navy

‘Driving the Rizzo reforms through will require focussed leadership and commitment at all levels within Navy and represents both a challenge and a great opportunity. Reinvigorating technical integrity as a core element of our technically advanced capabilities within Force 2030 will require further cultural change. These changes are not about engineering - they are about capability management and they affect us all.’

VADM R. Griggs, AM, CSC, RAN

Australian Defence Magazine

Dec 2011 / Jan 2012

RIZZO – Key Findings

Poor whole-of-life asset management;

Organisational complexity and blurred accountabilities;

Inadequate risk management;

Poor compliance and assurance;

A ‘hollowed-out’ engineering capability;

Resource shortages in system program offices (SPOs) in DMO; and

A culture that places the short-term operational mission above the importance of technical integrity.

How are we going to achieve it?

RIZZO Review

An implementation team of Navy and DMO personnel has been established and is led by CDRE Mark Purcell, RAN;

This team is managing the detailed implementation of recommendations in concert with the related ANAO audit of Acceptance into Service of Naval Capability and the Strategic Review of Naval Engineering; and

An Implementation Committee, chaired by Mr Rizzo is ensuring that the agreed recommendations are being effectively implemented in a timely way.

A balancing act

Capability Management End-to-End Lifecycle

7

SRNE NEWS

Report

AASSPO

LPA SwB

report

Review LPA

Operational

Pause

SUCCESS

Tech.

Investigation

Fleet

Regulatory

Review

ANAO AINS

Sustainment

Business

Model

Mortimer

Configuration

MGT Review &

Project

Helmsman

KPMG MSA

Review

Reconstruction

AASSPO

Strategic

Reform

Program

HRRP R24: PMO

Lifecycle

Management

R5: Industry

Partnerships

R6: Remediate

ICT

Shortcomings

Rebuild

Engineering

R14:

Technical

Compliance

R19:

Engineering

Talent

R20: Rebuild

FSU

R17: Rebuild

Engineering

R13: Integrated

Risk Management

System

R21: Reinstate

Cultural Importance

of Risk

Management

Seaworthiness

Management

Seaworthiness

Culture

R2: Whole of

Life

R1: Asset and

Sustainment

Methodologies

Lead recommendations

provide overall structure and

direction for work stream

1 Capability Mgt

Accountability &

Responsibility

R8:

Capability

Management

R9:

Workforce

Planning

R10: Fleet

Command

R11: Mutual

Obligations

R12:

Information

Exchange

R7: Closer Working

Arrangements

2 3

Total Cost of

Ownership

R4: Plan for

Aging

Vessels

Submitted for Closure

Dec 2011

R23: Confirm

Maritime

Resourcing

4 5 6

R15: 3rd

Party QA

R18:

Resource

AASSPO

Lead Recommendation

R3: Constrain

Kanimbla

R22: Quantify

Maint and

Eng Backlog

R16: AINS

Related Reform Program

How are we going to do it?

A deliberate, phased journey

8

Evolution

July 2011 – Dec 2011

“Address Near-term

Priorities and Establish

the Program”

Jan 2012 – Jul 2012

“Back to Basics”

Aug 2012 – Dec 2013

“Build the Foundation”

Time

Quantify large cost

implications, including

quantify and assess

criticality of the backlog

Quick wins implemented

Future policy and

organisation requirements

determined

Business case for ‘Back

to Basics” phase

New policies, processes and structured designed with implementation underway – New ‘Whole of Life’ approach

designed – Clear plan for ageing vessels

developed – Industry partnerships strengthened – Near-term ICT shortcomings

remediated – New capability management

resources defined – Components of Engineering

function rebuild defined Initiate culture change Maritime resourcing confirmed Full business case for end-state

developed, including the ‘high cost’ initiatives

Robust whole-of-life asset management

and decision making

Simplified organisation with clear

accountabilities and a clarified interface

between Navy and DMO

Holistic, integrated risk management across

Defence and DMO

Robust and comprehensive compliance and

assurance

Rebuilt and redesigned engineering

function

Sufficient trained and experienced

resources in DMO SPOs

Long-term ICT shortcomings remediated

A culture that balances short-term

operational mission needs against long-

term asset implications and whilst

maintaining agreed levels of technical

integrity

Rizzo Reform Journey

Current

Focus

2014+

“Build High Performance

Capability Management and

Technical Integrity ”

A rebuilt and

redesigned effective

Maritime Capability

Management and

Technical Integrity

Assurance System

that drives

seaworthiness and

preparedness

Masters of the

technology we

employ – informed

user, owner,

maintainer,

customer

Rebuilt expertise in ILS

Promulgated policy for all stages of

Capability Life Cycle

Project Governance board covers through

life support

Efficient contracting mechanisms support

broader and longer term contracts that build

deeper and continuing industry

relationships, whilst retaining competitive

tension

Navy, DMO and industry are collocated

where possible with common goals, metrics

and shared information systems

An ICT system that provides decision

makers with more reliable, timely

information about materiel states, driving

more effective maintenance and better

operational & SPO level engineering

Data integrity is improved and is more

available for reporting, analysis and control

Life Cycle Management Project Summary

A formal, integrated and disciplined asset and

sustainment management approach has been

established across Navy, DMO and CDG over

the whole of lifecycle, ensuring seaworthiness

and preparedness and optimised Total Cost of

Ownership

Efficient and effective allocation of sustainment

resources occurs as capabilities age

Increased maturity is evident in Defence's

process including the application of asset

management and LEAN methodologies

when purchasing an asset whole of life

decisions are made taking into account all the

enablers that contribute to the sustainment of

an asset over life of type.

detailed configuration baselines exist for all

ship/submarines.

1

Project Director: Mr. Tony Hindmarsh Project Executive: Mr. Tony Hindmarsh Mr Scott Huxtable

Lifecycle Management Project

Capability Management Accountability and Responsibility Project

Navy is more aware of its materiel needs

and DMO is more aware of how materiel

requests support Capability – this

improved working relationship drives

collaboration and better strategic

outcomes in design, engineering support,

policy, maintenance and supply

performance

through improved Materiel

Sustainment Agreement (MSA)

reporting

clarified responsibilities between

Navy and DMO

SPO directors are empowered to

deliver performance levels in the

MSA

MSAs with clearly defined obligations of

Navy and DMO supported by

performance measures and a reporting

framework minimise duplication of effort

and „gaps‟ in the materiel sustainment

process to drive improved engineering

support and more effective maintenance

A performance management framework for

the MSA that appropriately incentivises both

Navy and DMO to adhere to their

responsibilities, ensuring improved

engineering support and more effective

maintenance

Strengthen capability management resources

to assess the state of the fleet against the

MSA including increasing resources available

to the capability manager

Effective workforce better aligns skills to

position requirements, driving improved

performance at the operational and support

level and more effective maintenance

Fleet Command has greater capacity to

ensure the operational preparedness of

platforms, across both materiel and personnel

elements

Capability Management Accountability and Responsibility Project Summary 2

Project Director: CAPT Simon Woolrych Project Executive: RADM Alan DuToit

Rebuild Engineering Project

Rebuild Engineering Project Summary 3

A Seaworthiness Management System that

provides CN transparent, rigorous and

independent assurance of Safety, Operational

Effectiveness and Environmental protection

across fleet

An Engineering , Maintenance and Supply

Support System that is adequately resourced to

support platforms in the various stages of the

operational cycle defined in the FOC.

A program of building engineering talent that

enhances the available pool of capable personnel

to ensure technical integrity of the Fleet

The capability of the Fleet Support Units is rebuilt,

and the FSU has a significant formal role in the

provision of maintenance support to platforms and

repairable items.

Navy Engineering has authority and clear

accountability to ensure technical integrity of the

fleet

Navy inspects and surveys ships, providing

greater confidence in the technical integrity of the

fleet

Rigorous and recurring 3rd party quality

assurance of platform seaworthiness, providing

independent assessment of technical materiel

integrity, generating greater confidence that ships

and submarines are fit for service

As is the case with Submarines, the material

condition of surface ships will be

certified/assessed prior to proceeding to the next

stage of employment under the FOC in order to

provide the FC with assurance that minimum

material standards have been met.

Project Director: CDRE Keith Malpress Project Executive: RADM Michael Uzzell

Total Cost of Ownership Project Summary 4

Project Director: CAPT Ljiljana Bradley Project Executive: RADM Allan du Toit

An agreed baseline of the resources

(workforce) required to adequately operate

and maintain materiel for the next 10

years. This includes:

Choules, New Submarines, LHD,

AWD, AASSPO

rebuilt Navy Engineering

removing the engineering and

maintenance backlog across the

fleet

improving capability management

in the groups, whilst not slowing

down the DCP

remediation for certification,

configuration and safety case

baselines

New Asset and Sustainment

Methodologies

A joint usage and upkeep plan between

Navy and DMO outlines the future

engineering and maintenance costs for

aging vessels providing decision makers

with the information necessary to make

trade-offs when managing materiel

(including the mitigation of “Bathtub”

effects)

The maintenance and engineering backlog

across the fleet is accurately quantified

and costed via an independent audit.

Recovery action reduced the backlog and

remediate any consequences of

maintenance or engineering that was not

conducted when required.

Total Cost of Ownership Project

Integrated Risk Management Project

An integrated risk methodology for maintenance of

maritime capability emphasises the vertical link between

risk appetite at the enterprise level and its application at

the workface; and the horizontal processes necessary to

capture the full risk-benefit trade-off. The integrated risk

management system has:

Enhanced business discipline and internal controls

promoting a culture of ethical and accountable

behaviours

Reduced reactive management time spend on “fighting

fires” through a more consistent early notification of risk

threshold alerts

A more structured approach to quantifying the overall

risk and uncertainty from all factors across the DMO

maritime programs and all stages of the program

lifecycle

A heightened awareness and transparency around

material risks and efforts to manage them

Project Director: CAPT Paddy Hodgman

Project Executive: RADM Michael Uzzell

Seaworthiness Management Project

Summary 5

Seaworthiness Culture Project Summary

Seaworthiness Culture Project

14 DATE

A culture exists in Navy and DMO that

recognises technical integrity as a key enabler of

capability.

Operational demands are balanced against

maintaining technical integrity

Technical integrity is improved across the fleet

6

Project Director: CAPT Michael Sander

Project Executive: RADM Trevor Jones

A structured approach

Change Management Approach

What are we addressing and what will it benefit?

Seaworthiness

Total Cost

of

Ownership

Preparedness

Capability

Process Organisation

Information Technology

Acting as “capability manager”

End-to-end Asset and

Sustainment methodologies,

processes and tools

Risk management codified into

day-to-day operations

Assured authorised

engineering organisations

Clarified organisational

interface between Navy and

DMO

Rebuilt and redesigned Navy

engineering function and

people capabilities with

strengthened accountability

Clear reporting and

information flows across

the organisations

Informed trade-offs

across both the near and

long-term

Assured, fit-for-service

Maritime platforms

Right tools to support

decision making

The reforms will assist with Enterprise Risk Management

Fight &

Win at

Sea

Deliver Capability

to Government

Attract & Retain

our Workforce

Achieve public

confidence and trust

in Navy’s Capabilities

Continuously

Improve

A Navy that Confidently Goes to Sea

QUESTIONS

"It is the capacity for maintenance that is the best test for the vigour and stamina of a society. Any society can galvanise for a while to build something, but the will and the skill to keep things in good repair, day in and day out, are fairly rare.“ (Eric Hoffer)