Operationalising the Defence Industry Development Strategy (DIDS): A Blueprint for Success Starting with Maritime

Having been actively involved in the Australian Maritime domain for over a decade now, supporting both government and industry clients, I’ve been reflecting on where we stand today and thought I'd share some of my thoughts.

Recently, we had the opportunity to work with another leading shipbuilding prime on the first post-2024 Defence Industry Development Strategy (DIDS) tender response to a key naval shipbuilding project. Completing this work triggered my reflections on the necessary ingredients for success moving forward.

In many ways, the Maritime domain has arguably never been better positioned for success. With 38% of Defence's investment over the next 10 years set for this sector, it is logically the highest priority and the perfect pilot domain to establish a blueprint for how to translate policy into outcomes. The release of the Naval Shipbuilding Plan in May 2017, with its focus on driving investment into the “key enablers” of infrastructure, workforce, industrial base, and a national approach, supported by the 2016 Defence Industry Policy Statement (DIPS) announcement that Continuous Naval Shipbuilding (CNS), was a Sovereign Industrial Capability Priority (SICP) laid a strong foundation for building an enduring naval shipbuilding and sustainment enterprise in Australia. However, more than 7 years later, one could argue that progress has been slow, and we appear to be facing many of the same old issues such as cost overruns, schedule delays, an underdeveloped sovereign industrial base / supply chain and an inability to attract/retain the necessary workforce.

A fundamental failing thus far has been the lack of sustained momentum and commitment that was seen when the Naval Shipbuilding Plan was first introduced. The failure to update this plan, especially in parallel with the AUKUS commitment, was a missed opportunity for me. The current government’s similar lethargy in this regard has not helped.

Now, with the release of the 2024 DIDS and Integrated Investment Program (IIP), which reaffirms Continuous Naval Shipbuilding (CNS) as a Sovereign Defence Industrial Priority (SICP v.2.0) and makes the Maritime domain defence's number one investment focus, we have the commitment and leadership needed to move at pace. Under the highly capable stewardship of Deputy Secretary Naval Shipbuilding & Sustainment Group (NSSG), Jim McDowell , we can create not only the naval shipbuilding enterprise envisioned in 2017 but also a blueprint for other domains, such as the Guided Weapons and Explosive Ordnance (GWEO) enterprise.

Key Steps Moving Forward:

The following key steps are intended to outline the necessary actions to more effectively “operationalise” the DIDS. It should be noted that whilst this is primarily focused on Naval Shipbuilding & Sustainment, much of this is applicable to all defence domains

1. Operational Framework Model:?We need defence to develop and deploy an overarching operational framework model, proactively driven by the NSSG, in collaboration with industry and possibly partner nations. This framework will define how Defence will do business across the capability life cycle, leveraging gate reviews and independent steering committees to provide the governance needed to ensure a standardised and repeatable approach to shipbuilding acquisition and sustainment programs is maintained across the enterprise. Robust SSAs, independent reviews of Program, Engineering and AIC Plans (which cover Supply-Chain & Workforce Management) to ensure coordination across the enterprise combined with the application of a common Performance Management Framework (PMF) across all programs will be critical to success.
2. Expanding Strategic Shipbuilding Agreements (SSAs):?Expanding SSAs to more overtly incentivise key industry players to deliver will also give them the certainty they need to invest and provide a platform to accelerate and force-multiply investment commitments, most notably articulated in their AIC Plans.
3. Elevating the Australian Industry Capability (AIC) Program:?The AIC program must be elevated in profile and importance. Capturing the hearts and minds of Systems Program Offices (SPOs) to ensure they appreciate and harness the potential of successfully executed AIC programs can significantly accelerate the realisation of the enterprise intent most notably across the naval shipbuilding & sustainment key enablers.
4. Engaging the Ecosystem:?Engaging the entire ecosystem is crucial—not only industry primes like ASC, Austal, BAE, HII, and Babcock but also ensuring that SMEs have a voice and that state governments and science and technology/academia are represented (most notably DSTG & ASCA). The collective fusing of this ecosystem can generate greater levels of innovation and economic benefit, essential to bolstering capability and accelerating speed to market (the current "Ghost Shark" program is one example of this). This supports the argument for adding Innovation/R&D as a new/fifth key enabler in the revised Naval Shipbuilding and Sustainment Plan.
5. Retaining Critical SMEs:?It's essential to retain companies operating in key supply chain categories linked to Sovereign Defence Industrial Priorities (SDIPs). The current "focused force" policy means we must strategically pick winners. Mechanisms like SSA’s and a more robust AIC program are vital tools in this process.

Applying this value proposition specifically to current Maritime sustainment and future acquisition projects (like LCH, GPFs, and Undersea Warfare) would create a compelling case for all stakeholders—government, primes, SMEs, academia and industry associations.

I remain optimistic and excited about the future. Yet, having been in the sector for more than two decades, I also remain cautious about our ability to avoid repeating the mistakes of the past at a time when it has never been more important to succeed.