At ASPI’s Defence White Paper: from page to reality conference, I got to sum up the future challenges for the acquisition program. The most certain prediction I could make is that the program won’t ever be delivered. In fact, it’d be an outlier among Defence White Papers (DWPs) if it gets even close.

If we look at its six predecessors, Mark Thomson’s data shows that only DWP 2000 got (most) of the promised funding. But, as my previous analysis showed, a third of DWP 2000’s major capability announcements were cancelled, or significantly changed in scope. And it’s not finished yet—the air warfare destroyers and joint strike fighters are still to be delivered, and some of the helicopter projects are yet to reach full capability (and the Tiger armed reconnaissance helicopter never will).

It’s not surprising that even the best funded DWP didn’t completely translate into ADF capability. The intervening 16 years saw big changes in the external environment—DWP 2000 was written with the lessons of the 1999 Timor operation fresh in mind, but the delivery process was barely started on 11 September 2001. There have also been big swings (in both directions) in government revenues, rapid technological developments, and three major reviews of Defence acquisition. We can hardly expect the next 16 years to be any more predictable or linear than the previous 16, so we shouldn’t expect DWP 2016’s program to remain inviolate. What follows is my best guess at the challenges that lie ahead—my ‘known unknowns’, if you like.

Challenge #1 is economic pressures. The Turnbull government’s plan will deliver 2% of GDP to defence earlier than the Abbott government promised, but not because there’s more money. Instead, Treasury thinks GDP will be smaller in the 2020s than it thought a couple of years ago. If that trend continues (and economic projections have been falling for some years now), a future government might find itself with a bill for 2.5% of GDP to deliver the 2016 DWP—and it might have other priorities. Current governments can’t tie the hands of future ones (or even its own the following year). This year’s budget figures are bankable, the forward estimates (next three years) are suggestive, and everything further out is aspirational.

But let’s be optimistic and assume that the money will eventuate: Defence will have to spend $142.7 billion on capital acquisition in the next decade, compared to $76.6 billion in the previous (both figures in 2016 dollars). That brings us to the second challenge: at the moment, Defence doesn’t really have a functional project development and acquisition process. The First Principles Review implementation involves major organisational changes: the former DMO has been pulled back into the core of the business, and the former Capability Development Group has been scattered between the three Services and the VCDF. It also adds a new ‘Gate Zero’ into the Kinnaird two-pass process. (Cynics in Defence have been heard to say that the previous two-pass process has been simplified to a three-pass process.)

Gate Zero has plenty of potential to help, particularly in terms of getting a project into the Integrated Investment Plan. Intended to be a ‘quick look’ sanity check at the start of the process, it could result in proposals being fast tracked, including sole sourcing where appropriate, rather than chugging through a laborious competitive process. So far, so good. But it also looks like the First Pass process that Kinnaird (PDF) originally envisaged, before ‘pass creep’ set in and First Pass came to require supporting documentation and data that could take years to collate, with cost confidence unlikely to be achievable so early. For a major project such as the future submarine, that’s probably OK, but for many projects it’s overkill. When Mortimer (PDF) reviewed the Kinnaird implementation, in 2008, he lamented the slowness and again recommended streamlining simpler, less risky projects. Based on the number of approvals over the years, that hasn’t happened. The danger is that Gate Zero will become a third hurdle if Defence defaults to process (or is forced to by the central agencies). And there’s a real danger that many—if not all—of the projects already in the IIP that accompanies DWP 2016 will need to go through Gate Zero

Even when Defence’s internal deliberations are finished, the Defence Minister has to approve any project up to $20 million. The Defence and Finance Ministers have to approve projects over $20 million, and anything over $100 million—not a big number by Defence standards—has to go to the National Security Committee. Just how the NSC is going to deal with the number of defence projects in the forward program isn’t clear. There’s a clear case for raising the thresholds for Ministerial and NSC approval, as the First Principles Review suggested. Perhaps there’s also scope to increase funding available to the Capability Managers as part of the now overregulated ‘minors’ program—which has, thanks to a previous minister, been unnecessarily subjected to its own two-pass process.

I’ll come back in part 2 and look at some of the other challenges that lie ahead in the areas of industry, politics, technology and project management.

As the drum roll fades following the swearing in of Australia’s first ever female Defence Minister, I’m left wondering what we should now expect. While Senator Payne is the first ‘femmindef’ for Australia, she joins a long list of international female Defence ministers who have gone before her. How will the Australian Department of Defence be shaped or be different with a female at the helm of such a male-dominated portfolio? Will Senator Marise Payne crack the tempered glass ceiling from above and start lowering down the career ladder for women in Defence? Can this be done in a way that might change the organisation and the defence of the nation in a positive way?

Payne has asked that she be judged by her work, rather than her gender, and I, like other feminists, would hope that’s the case. However, it’s her experience as a woman in Government, as a woman who knows the Defence landscape, and as a woman who proudly calls herself a feminist, that brings an unprecedented vantage point unseen in the Department until now. It is this vantage point that will be a significant point of difference from her predecessors.

It’s difficult to be hypothetical about the difference a female minister, this female minister, may have on Defence over the coming year (or beyond), particularly in an organisation and portfolio prone to so much change—or at least talk of it. Perhaps we can look to the last 12 months in Defence and ask ourselves if, or how, decisions and outcomes may have been different had she been in place. Would the male-dominated First Principles Review (FPR) team been left as just that, despite its sexist irony? Would Defence have sent male ‘champions of change’ to women in leadership forums, or would they have instead sent a woman in leadership to share insights into the lived experience?

Would the news story around the biggest changes to Defence legislation in decades have been solely focused on superannuation, or rather the fact it creates the biggest structural change to enable part-time work in Defence’s history? It will have probably the most significant impact to women’s ability to remain and thrive in the Defence workforce ever, yet sadly the accomplishment wasn’t given the status it deserved. Opportunity lost, Defence PR.

Andrew Davies’ incoming brief to the Minister on The Strategist had many valid points but was remiss of any mention of organisational culture, or the continued effort to alter long-entrenched hypermasculine behavioural standards accepted as the norm. Those behaviours still exist, in both sides of the house: the ADF and the APS. Perhaps this requires an incoming brief all on its own? Here are a few points I think are worth including:

• Defence has created significant opportunities for change, the motivation to change, and the capability for change. However this needs to be supported by evidenced-based and targeted interventions, and evaluations of their effectiveness, lest it ends up on a pathway to the status quo.
• The structural and organisational changes currently being implemented through FPR are predominantly being viewed by the working level as shrouded in mystery, uncertainty and secrecy. Cracks are appearing that threaten to destabilise the culture even more. As any organisational culture analyst will tell you, this ambiguity, added to uncertainty surrounding personnel cuts, creates ripe ground for the type of ‘unacceptable behaviour’ that Defence has worked so hard to stamp out.
• There are inherent risks in the anticipated wide-sweeping changes not being as swift and as wide-ranging as FPR initially promised to be. Cue another ‘review’ to add to the plethora that came before to reexamine what went wrong.
• What Defence likes to call ‘unacceptable behaviour’ equates to ‘violence’ and ‘anti-social behaviour’ in the lingua franca. Using the more neutral term has served to shield Defence from comparisons with the wider community and this does everyone a disservice. A great starting place for improvement would be for Defence to begin collecting data using descriptive terminology that aligns with how places such as the ABS or AIHW collect theirs—common language to begin with, and benchmarking is possible.
• Defence remains committed to increasing its diversity and inclusion levels, with a bigger focus on diversity, but less on understanding what authentic inclusion practices actually look like. Will a ‘femmindef’ be content with the current pace of moving from integration to inclusion, or will she push toward a frontier of empowerment for minority groups?

Submarines, white papers and war are all up there when it comes to consuming the Minister’s time, and rightly so. But will a femmindef be able to multitask both culture and capability in a way that none of her male predecessors have yet been able to? I hope so.

Previously on the Life cycle of the Australian defence review we explored the life pattern of this robust herd animal from conception to gestation, birth, infant years and the review’s emergence into full maturity. This time we have to contemplate how reviews age and die. Just as for Gnus in Africa, life is brutal and short on the policy veldt. Many reviews get trampled underfoot by newer processes. Only a few reviews—like Sir Arthur Tange’s Australian Defence Reorganisation of 1973 and the Defence Reform Program of 1997—survive long enough to mostly be implemented.

Why do some reviews thrive while others fail? After writing his own review Sir Arthur Tange spent the second half of his almost decade-long time as Secretary implementing his own work. He had intellectual firepower, grit and tenure working for him. Paul Dibb’s Review of Defence Capabilities benefited from Kim Beazley’s tenure as Minister to keep pushing for implementation. The Defence Reform Program (DRP) outlived a number of Liberal ministers but Prime Minister John Howard kept the process on track. In each case these reviews got clear air to be implemented without other reviews chewing their hamstrings. All three reviews intelligently proposed big reform, got powerful political backing and had time to bed down.

But this isn’t the fate of your average review. Stage six in the life cycle is ageing and predation. By the time review implementation enters its second and third year, entropy slows the momentum for change. It may be that there’s entrenched resistance to making difficult changes—the Strategic Reform Program, for example, found it inordinately hard to apply shared services for many back office functions across the Defence tribes. Some review recommendations turn out not to be worth implementing, or in other cases there are political barriers that make implementation near impossible. A number of reviews of the Defence estate, for example, failed because of backbench resistance to selling bases. Reforms of defence procurement have struggled to streamline Cabinet processes for decision-making on equipment. A recommendation needs to be politically achievable as well as look credible on paper.

Reviews falter when Ministers, officials and implementers move on. When the implementation team leaves, their successors will often puzzle over previous decisions. At that point it becomes easier to adopt a different strategy, and review recommendations can fall by the wayside.

In the seventh stage of the life cycle—death on the veldt—nothing brings down a big review quicker than a change of government. Thus the Proust Review of 2007 was cut down in its prime by a change of Government and the new Minister’s implementation of an election commitment to launch what became the Pappas Review. Pappas begat the Strategic Reform Program, which was mortally wounded by the time of the 2013 election. Then, the new Government implemented its own election promise for what became the First Principles Review. While the First Principles Review pleaded for a five-year period free of reviews so that it could have a clear run at implementation, the recommendation is unlikely to work. Like all its predecessors, Mr Peever’s review will have to take its chances with elections, changes of ministers and of key Defence staff.

For many lesser reviews success might be measured by either their implementation or eradication. I was closely involved in managing two reviews done by external experts. The first made sensible recommendations to change aspects of how Defence managed equipment export approvals. It was the political response to a very brief media squall about an export matter. The recommendations were implemented, became the new normal and defence exports are better as a result. The second review was an attempt to handle an unhealthy obsession about the numbers of Defence personnel posted overseas. It made a number of reluctant recommendations that would have reduced Australia’s capacity to manage some important international relationships. At a time when the pressure is for Defence to do more overseas, it seems that the recommendations have been quietly ‘overtaken by events’.

Finally we come to the last stage of the life cycle. This is when the memory of some reviews live on, often unintended, as folk wisdom about what a review ‘did’ to Defence. Think of this as a version of philosopher Gilbert Ryle’s, ‘ghost in the machine’—a term he coined to criticise a view of mind-body dualism that ‘the body and the mind are ordinarily harnessed together, but after the death of the body the mind may continue to exist and function.’

In Defence the ghost in the machine of the Dibb review is the folk wisdom that it structured the ADF for ‘chasing thugs in thongs’ around northern Australia. Actually a fair reading of the review is that it did nothing of the sort. Another ‘ghost in the machine’ myth is that the Defence Reform Program gutted the Services of logistic support and imperilled Australia’s deployment into East Timor. In fact the opposite is true; the DRP jolted Defence further down the path of being a jointly-enabled force, and necessarily broke a few rice bowls in the process.

And so we say farewell to the life cycle of the Australian defence review, a persistent and much abused creature of the policy veldt. What lessons should we learn? First, Oppositions in particular shouldn’t promise too many reviews. Given the volatility of Australian politics there’s always a risk that such promises will have to be implemented. Second, knowing what it takes to actually do a serious review, it’s predictable that implementation stages will only gear up as we get towards the last months of our three-year election cycle—a politically risky time. Third, reviews slow down Defence administration. In the 12–18 months it takes to deliver a product the department is in a fallow period where it’s constrained to make changes because, well, a review is about to be delivered. Pause for a second to think about the implications of this: there’s hardly been a time in the last twenty years when Defence hasn’t been subject to a big external review (yet the criticism is that internal management is poor!) Finally, with all that said, if a review really is needed the Tange, Dibb and DRP precedents say that it’s best to go big. On the veldt it’s the big, bad Gnus that run the herd. It’s exactly the same in the Defence review business.

Smiling faces beam from the cover of Creating One Defence. These happy folks, with photos balanced for gender and Service, are pleased that Defence business processes have had their 36^th substantive review since 1973. They may agree with the report that there are ‘low engagement levels amongst employees’, that they’re ‘inward looking, complicated and difficult to manage’, that they’re ‘risk averse and resistant to change’, and that they’re ‘subsumed by box-ticking and process tinkering’, and badly in need of ‘changes to behavioural mindsets’. If so, One Defence is the answer to their problems, for it’s nothing less than an ‘end-to-end holistic review’ and a ‘total systems approach based on evidence and analysis.’

It’s important to look beyond the business-speak of One Defence because David Peever and his colleagues on the review team are correct in their diagnosis of Defence’s management problems. Their critique is all the more stinging because of its accuracy. If implemented, the 70 recommendations in the report will modernise the organisation. A small number of recommendations should’ve been taken further and a few left out altogether but, as reviews go, One Defence is sensible, serious and purposeful. It needs to be studied closely.

The reviewers tackled a central conundrum: ‘we were puzzled as to why Defence has been unable to reform itself’ and identified three ‘root causes’ which have created ‘complacency and inertia’:

The high operational tempo and increasing national security demands over the past decade have demanded high levels of the senior leadership’s time and attention;

Budget uncertainty, with $18.2 billion removed from the Defence budget from 2009–10 onwards which has led to reactive planning, deferred military capability and a hollowing out of enablers …

Leadership churn from 1998 to the present, resulting in nine ministers with an average tenure of two years, six Secretaries with an average tenure of two and a half years and five Chiefs of the Defence Force with an average tenure of four years.

Defence might take some comfort from this diagnosis because none of these factors are the organisation’s doing. A high operational tempo is the result of worsening strategic circumstances. The fact that the operational record since 1998 has been exemplary surely says something worthwhile about Defence’s management skills. Australians love to indulge in the ‘lions led by donkeys’ myth, but operational success is based on good military and civilian leadership as well as good fighting forces. Looking forward, a savvy reading of our strategic outlook would judge that Defence’s operational tempo will remain high. Senior military leaders and our politicians will continue to be absorbed by military operations. So this root cause of ‘complacency and inertia’ will remain, but let’s remember that Defence is there for the purpose of doing military operations – it’s not a diversion.

On the second root cause—budget uncertainty—Peever’s team is 100% correct. Strip mining $18.2 billion dollars in a couple of years after 2009 essentially destroyed Defence’s capacity to implement the Strategic Reform Program, the implementation plan for the 2008 Pappas Review, the previous big externally led review of Defence . The spending plans of defence white papers since 1976 were all rapidly undercut by Government-directed budget rethinks. The 2000 White Paper is partially exempted from this generalisation because, while it underestimated key program costs, the document also committed to a ten-year spending plan, which in reality was exceeded by a government riding high on the minerals boom. The global financial crisis put an end to such largesse, but while the government cut funds there was no change to the grandiose force structure plans set out in 2009 and 2013.

The message for government is clear: if you want Defence to manage itself better, you need to stick to deliverable and long-term spending plans. Those two qualities require a large measure of political bipartisanship and a willingness to not over-promise. It would be naïve to think that Defence is out of the woods about its future financial stability. Broader economic pressures on Government are growing and the central money agencies in Canberra are circling because that’s what White Pointers do. So Peever’s second ‘root cause’ won’t go away either.

It would be nice to think that leadership churn will go away, but One Defence’s third root cause is probably a permanent feature of our political system and the way it intersects with the Australian Public Service. Thirty-six month (maximum) terms of office means that Governments are never far from campaign mode and, as a consequence, ministerial longevity is a rare gem. The tenure of Secretaries and CDFs is the gift of governments. It’s obvious from the shorter tenure of Secretaries that Governments are happy to tinker with those positions more readily than they are CDFs. As Hayley Channer and I observed in an earlier post, four of the previous six Secretaries before Dennis Richardson left the job in publicly unhappy circumstances. One Defence doesn’t dwell on the point, but an obvious lesson for any government is that it needs to get its relationship right with Secretaries—and not just in Defence. Leadership churn is a feature of modern public life, so no one should imagine that One Defence will make that phenomena go away.

Notwithstanding that, the three ‘root causes’ identified by the review team are likely to be constant realities for Defence. If implemented, the recommendations will produce better outcomes, even in the midst of high tempo operations, budget disappointments and leadership change.