Industrial Strategy - Capitalizing the Canadian Forces

[KevinB]

And nobody is saying that we are building inventory just to keep the doors open, or just to employ Canadians.

I am talking about the targeted building of inventory of goods that are critical to the defence of Canada and the ability of Canada to respond to emergencies when the Just In Time supply chains fail. And that includes not just an adequate stock of Standard Missiles, or 7.62mm Ball. Toilet Paper anyone?

A Military should never be using JIT for a supply chain - they need a supply in depth to cover at least 5 years of peacetime consumption - and a varying degree of items on a wartime consumption schedule - the number depending on how long a lead time is it for those items -- some you may require a ungodly number of due to long lead times.

However when you say 'respond to emergencies', that is a rather open ended item.
I could come up with an Emergency that required 4 Armoured Divisions for Canada - but the likelihood of that versus the cost is where Government need to make a call.

Personally I think the CF needs a lot more equipment - but it also needs a reality check before any programs get rolling.
Someone at the CDS or MND level needs to take the service chiefs out back behind the wood pile and beat them until they agree to a Joint Force Construct, and out the good of Canadian Defence first as opposed to petty squabbles about fiefdoms.

The best way to maximize the Canadian Dollars for Defence spending is cooperative programs with Allies - and with a joint goal in the CF to fulfill the mission as best as they can.

 

[Kirkhill]

Another way to think of the targeted building of inventory to support a Just In Case economy is that it would be in keeping with Canadian interest in Widows and Orphans funds, Mutual Funds, Savings Banks, Lloyd's names and even Universal Health Insurance.

We have never balked at an opportunity to make a penny by making others help feel safe.

Private fire companies?

I am thinking of a targeted, limited, probably tax-code based, measure designed to create a more resilient country. And part of the that resilience would include making sure the tools were on hand for the Canadian Armed Forces to operate effectively when the situation demands.

That would also free up the actual defence budget for training and standing operations. Extraordinary operations would be funded, as they are now, from General Revenues.

And the accountants can decide which column to put the actual numbers in, and what to call them, to make the politicians look good.

 

[Kirkhill]

However when you say 'respond to emergencies', that is a rather open ended item.

I agree. Emergencies are open ended. And some cannot be managed no matter how much planning and preparation you have committed.

And I can come up with emergencies where the entire WW2 establishment, domestic and deployed, wouldn't do any good at all. The joys of speculation.

The question is how many bumps and potholes, hairpin turns and swerves, can we afford to remove from the path ahead?


Not all of them, definitely. But a lot more than we are.

 

[Kirkhill]

Personally I think the CF needs a lot more equipment - but it also needs a reality check before any programs get rolling.
Someone at the CDS or MND level needs to take the service chiefs out back behind the wood pile and beat them until they agree to a Joint Force Construct, and out the good of Canadian Defence first as opposed to petty squabbles about fiefdoms.

The best way to maximize the Canadian Dollars for Defence spending is cooperative programs with Allies - and with a joint goal in the CF to fulfill the mission as best as they can.

And Yes. Absolutely.

 

[Kirkhill]

And, to go back to an earlier point of yours, by all means work in association with allies.

But does that include a Canadian version of the new Aussie missile factory? Or should we just continue to buy missiles from the Yanks? GD-OTS might be a good starting point?

And does that preclude taking the lead on developing solutions unique to our circumstances?

 

[GR66]

Rather than identifying industries in which to invest for developing stocks (i.e. picking your winners in advance) I think if you instead just developed an ongoing procurement plan which saw regular purchase and replacement of our key items you'd get companies to invest in Canadian production facilities.

Plan ahead for our material requirements. Signal our requirements well in advance to industry. Be a trusted partner by sticking to your plans instead of tendering then cancelling and industry will see the advantage of dealing with Canada and setting up shop here to fulfill our requirements.

This way will leave openings for new contenders to join the market rather than defaulting to your pre-selected industry "champions". Selection though should always be predicated on getting the best product for the military - wherever it is made - rather than just the best Canadian-made product. Giving our troops the best tools we can in order to survive and win should always trump jobs or votes.

 

[Kirkhill]

Rather than identifying industries in which to invest for developing stocks (i.e. picking your winners in advance) I think if you instead just developed an ongoing procurement plan which saw regular purchase and replacement of our key items you'd get companies to invest in Canadian production facilities.

Plan ahead for our material requirements. Signal our requirements well in advance to industry. Be a trusted partner by sticking to your plans instead of tendering then cancelling and industry will see the advantage of dealing with Canada and setting up shop here to fulfill our requirements.

This way will leave openings for new contenders to join the market rather than defaulting to your pre-selected industry "champions". Selection though should always be predicated on getting the best product for the military - wherever it is made - rather than just the best Canadian-made product. Giving our troops the best tools we can in order to survive and win should always trump jobs or votes.

I can't solve problems with promises.

Nor can I solve today's problems with next year's wonderware.

On the other hand I can do something with stuff that I have in my hand - even if it is 70 years old and patched up by my predecessors.

How on God's Green Earth Is the B-52 Still in Service?

The B-52's now in action fighting ISIS—and could spend another 40 years in the air.

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Unfortunately, while the Americans may have lots of ancient gear to repurpose we in Canada have nothing like that in inventory. With or without parts, munitions or crews.


That is the result of the past.


Going forwards the question becomes: When we build inventory do we fill it with ancient stuff that has to be repurposed or do we fill it with next year's wonderware?

And when can we get to a state where we have a modern inventory stocked with adequate supplies of solutions we trust?

 

[Kirkhill]

Or at least have a stock on hand that we can modify and repurpose to meet the needs of the day.

 

[daftandbarmy]

Rather than identifying industries in which to invest for developing stocks (i.e. picking your winners in advance) I think if you instead just developed an ongoing procurement plan which saw regular purchase and replacement of our key items you'd get companies to invest in Canadian production facilities.

Plan ahead for our material requirements. Signal our requirements well in advance to industry. Be a trusted partner by sticking to your plans instead of tendering then cancelling and industry will see the advantage of dealing with Canada and setting up shop here to fulfill our requirements.

This way will leave openings for new contenders to join the market rather than defaulting to your pre-selected industry "champions". Selection though should always be predicated on getting the best product for the military - wherever it is made - rather than just the best Canadian-made product. Giving our troops the best tools we can in order to survive and win should always trump jobs or votes.

And get away from the pandering, pork barrel approach so that everything has to be made in Eastern Canada.

oops.... I assume a puppy just died somewhere

 

[Navy_Pete]

So for ref, this is already in place at a high level; see previous discussions on "Industrial and Technological Benefits', 'Value Proposition' or IRBs. The industry Canada policy is below, and it's already rolled into large DND pronouncements (and in like a dirty shirt for the NSS and other large projects).

Home - Industrial and Technological Benefits Policy

On the in service side we do it as well, but really gets driven around by the supply/procurement policies, as well as funding. Hard to stock shelves with no money for parts, direction was to minimize holdings, and when you have money and shelving still need to grind through the system to actually buy stuff. Because the actual procurement process takes so long we tend to buy larger quantities so there isn't a constant flow. Things like supply arrangements work great for common widgets with a high usage rate, but some things are only replaced every 5-10 years (or 20... sometimes 30), so there is no good single rule of thumb or generic approach that works for everything.

 

[daftandbarmy]

So for ref, this is already in place at a high level; see previous discussions on "Industrial and Technological Benefits', 'Value Proposition' or IRBs. The industry Canada policy is below, and it's already rolled into large DND pronouncements (and in like a dirty shirt for the NSS and other large projects).

Home - Industrial and Technological Benefits Policy

On the in service side we do it as well, but really gets driven around by the supply/procurement policies, as well as funding. Hard to stock shelves with no money for parts, direction was to minimize holdings, and when you have money and shelving still need to grind through the system to actually buy stuff. Because the actual procurement process takes so long we tend to buy larger quantities so there isn't a constant flow. Things like supply arrangements work great for common widgets with a high usage rate, but some things are only replaced every 5-10 years (or 20... sometimes 30), so there is no good single rule of thumb or generic approach that works for everything.

Then let's embrace 'agile procurement', like alot of the rest of the industrialized world:

Agile Procurement Definition​

The concept of ‘agile procurement’ is not a new one. The term ‘agile’ is one that has been borrowed from software development and now finds itself being used in a variety of industries.

The simple agile procurement definition states that “agile procurement is a type of procurement approach that is less strict, less orthodox, and more open and collaborative.”

It is a revolutionary methodology that turns traditional procurement frameworks upside down allowing for teams to make quicker decisions.

Agile procurement furnishes its adherents with a cross-functional type of model whereby new ideas, new ways of doing things are employed. There is a distinct breakaway from the ‘old-way-of-doing-things’.

Traditional Procurement vs. Agile Procurement​

Traditional procurement works on legacy systems and frameworks. Decisions aren’t hurried. Lots of time is taken with each of the procurement stages – identifying the needs, outlining the procurement plan, selecting suppliers, issuing RFQ, tender evaluation, contract terms & conditions, and supply chain management.

With agile procurement, on the other hand, time and speed are of the essence, so some steps are combined together – for example – contract negotiations can be entered upon during the sourcing process.

Where traditional procurement employs a large team of professionals, agile procurement may opt for a select handful of people to form a cross-functional team. Individuals are picked from the stakeholders. So on top of the procurement professionals, the agile team might feature IT, legal, customer representatives, suppliers, and finance experts.

In a nutshell, agile procurement provides greater efficiency, is more effective, and has a faster time to market speed compared to traditional procurement.

Agile Procurement: What It Is and How to Implement

Learn the agile procurement definition, the importance of agile procurement, and how to implement it in your 2021 operations.

blog.procureport.com

 

[Brad Sallows]

oops.... I assume a puppy just died somewhere

Yes, plummeted to its death on the back of an angel that lost its wings.

 

[GR66]

So for ref, this is already in place at a high level; see previous discussions on "Industrial and Technological Benefits', 'Value Proposition' or IRBs. The industry Canada policy is below, and it's already rolled into large DND pronouncements (and in like a dirty shirt for the NSS and other large projects).

Home - Industrial and Technological Benefits Policy

On the in service side we do it as well, but really gets driven around by the supply/procurement policies, as well as funding. Hard to stock shelves with no money for parts, direction was to minimize holdings, and when you have money and shelving still need to grind through the system to actually buy stuff. Because the actual procurement process takes so long we tend to buy larger quantities so there isn't a constant flow. Things like supply arrangements work great for common widgets with a high usage rate, but some things are only replaced every 5-10 years (or 20... sometimes 30), so there is no good single rule of thumb or generic approach that works for everything.

IRB's are in place to advantage compliant bids that also give industrial benefits to Canada, but the key part that is missing is the clear, ongoing procurement strategy.

For example, we have the NSPS in place to order a specific list of ships for the Canadian Government. What is missing is the ongoing piece of the puzzle. What are the replacement plans and timelines for the CSC replacement? Where is the plan to replace the aircraft that will replace the CF-18's? We don't need firm budget dollars yet for these things but we should have a plan where we are saying that we expect the CSC's to have a service life of "X" years and we will are planning on starting procurement of the next-Gen CSC in 20xx.

This would let the shipbuilding industry know that the NSPS is not a one-off deal (like the Halifax Class) and they can factor into their business plans the fact that they will be having the opportunity to bid on the next phase of shipbuilding contracts when it is due. This should be across the board for all our major fleets.

 

[Navy_Pete]

Some of our procurement requirements flow down from international trade agreements, so it's a different ball than a private company, but there are probably some options there. I think 'agile' and all the government buzzwords like 'value for money' 'responsible use of taxpayer funds' and the other tropes are pretty much anathema to each other.

Big fan of 'plain language contracting as well, but needs some lawyers who understand what you are doing and willing bidders.

We have at least incorporated relational contracting into some of the big ISSCs though, so progress I guess.

 

[KevinB]

Then let's embrace 'agile procurement', like alot of the rest of the industrialized world:

Agile Procurement: What It Is and How to Implement

Learn the agile procurement definition, the importance of agile procurement, and how to implement it in your 2021 operations.

blog.procureport.com

Forgive me for vomitting a little.
The US Army has recently tried that - I see it more as a Hurry Up to Fail methodology.

While the Acquisition process shouldn't take forever, a lot of the steps have been added to stop buying lemons, or something from someones favorite political toy.

It also ensures contracts aren't in place until a viable design is tested -- not like a cool design and hopefully we can fix it down the road...
SOCOM did that with the SCAR program - and resulted in a dislike from the Users, and a Manufacturer that didn't understand why.
The Army is trying that with Next Gen - and I see even worse outcomes.

And frankly Small Arms is pretty much one of the easiest systems to acquire...

 

[Navy_Pete]

IRB's are in place to advantage compliant bids that also give industrial benefits to Canada, but the key part that is missing is the clear, ongoing procurement strategy.

For example, we have the NSPS in place to order a specific list of ships for the Canadian Government. What is missing is the ongoing piece of the puzzle. What are the replacement plans and timelines for the CSC replacement? Where is the plan to replace the aircraft that will replace the CF-18's? We don't need firm budget dollars yet for these things but we should have a plan where we are saying that we expect the CSC's to have a service life of "X" years and we will are planning on starting procurement of the next-Gen CSC in 20xx.

This would let the shipbuilding industry know that the NSPS is not a one-off deal (like the Halifax Class) and they can factor into their business plans the fact that they will be having the opportunity to bid on the next phase of shipbuilding contracts when it is due. This should be across the board for all our major fleets.

To that point, NSPS changed to 'NSS' and they dropped the 'procurement' part, which would have ended it after contract award. The current plan goes out another 20 odd years, but every replacement that comes up is looked at to see if it fits within NSS. For some of the one-offs, like the big RORO ferry, it's too big to build in any of our yards and has specialized skill sets, so got the waiver from the 'Build in Canada' policy. But it's a big ask to have that become a 50 year plan when it's ultimately signed off on politicians that really only care about 4 years (or less) into the future.

But it's also not intended to be the sole source of income, just get the shipyards into the space to compete with the international yards. Because of the IRB requirements though, that flows down to a supply chain for the NSS ships that's largely within Canada.

GoC policy is a wrecking ball, not a precision hammer, but most governments have their own 'build in country' ship policies because the industrial benefits and trickle down is real and easy to measure. Obviously that work gets concentrated on the coasts,

 

[Kirkhill]

agile procurement may opt for a select handful of people to form a cross-functional team. Individuals are picked from the stakeholders. So on top of the procurement professionals, the agile team might feature IT, legal, customer representatives, suppliers, and finance experts.

It was bad enough when I saw "select" - Who is doing the selecting?

It got worse when I saw "handful" morph into a list of "experts" who might be involved.

And then I saw accountants, lawyers and IT people....

Kevin, pass the bucket.

 

[Brad Sallows]

Most "agile" doctrines boil down to "more concurrent activity". Not everything can be done well that way.

Although proponents of "agile" often try to rope in "lean" and claim it as their own, examining and applying each independently is more useful.

Theoretically, military communities knew of and could apply "selection and maintenance of the aim", "economy of effort", "centralized control and decentralized execution", "span of control", etc, long before business schools repackaged principles understood by great captains for millennia. Business is war.

 

[daftandbarmy]

Most "agile" doctrines boil down to "more concurrent activity". Not everything can be done well that way.

Although proponents of "agile" often try to rope in "lean" and claim it as their own, examining and applying each independently is more useful.

Theoretically, military communities knew of and could apply "selection and maintenance of the aim", "economy of effort", "centralized control and decentralized execution", "span of control", etc, long before business schools repackaged principles understood by great captains for millennia. Business is war.

Yeah, but the military is famously awful at translating what it knows works well in a battlefield context to more mundane corporate leadership challenges.

Viz:

About the Defence Ethics Programme​

Defence Ethics Programme​

The Defence Ethics Programme (DEP) is a comprehensive values-based ethics program put in place to meet the needs of the Department of National Defence (DND) and the Canadian Armed Forces (CAF), at both the individual and the organizational levels.
The aim and primary focus of the DEP is to foster the practice of ethics in the workplace and in operations such that DND employees and CAF members perform their duties to the highest ethical standards.

Vision​

To maintain ethical integrity by consistently applying the highest standards of values and ethics.

Mission​

To guide DND and CAF personnel in choosing conduct that is consistently ethical.

About the Defence Ethics Programme - Canada.ca

Documents and references related to the establishment and maintenance of the Defence Ethics Programme for the Department of National Defence and the Canadian Armed Forces.

www.canada.ca

 

[Brad Sallows]

I love "Vision" and "Mission" statements. Why have one (purpose, aim) when you can have two?