Smarter analytics, smarter procurement
International threats and homeland protection are not the only activities to which the military dedicates its time. Members within defence procurement continually work to improve internal processes as they deal with transformations in the security environment. If defence organizations wish to remain relevant and effective in protecting national security interests, they must continue to improve decision-making procedures.
In the past, defence procurement departments were traditionally disjointed. Separate tiers of responsibility, from design approval and funding to material sourcing and equipment maintenance, required a series of reviews and approvals, causing unnecessarily long and, in some cases, costly decision-making processes.
For example, the weapons acquisition process in the United States was historically inefficient. The purchase of a sophisticated weapon system would take anywhere from 10 to 15 years to reach stages in final development, all while incurring cost increases of 20 to 40 percent.
Clearly, things needed to change.
If technical, logistical and financial systems are more integrated, decisions could be made more quickly and the development process would be more efficient. Organizations in defence must continue to evolve maintenance actions and effectiveness using instrumentation and analysis, which will improve facility management and help create smarter installations.
Big data, bigger opportunities
Current changes facing defence procurement include growing cyber defence advances, a rise in operational cadence, challenging economic climates and the need to minimize operational costs. These trends, in conjunction with a vast amount of often disconnected data, drive the need for organizations to be better equipped at deciphering and utilizing relevant information.
Defence procurement organizations have started to take the hint. Using technology like analytics, organizations are better able to penetrate internal silos. By adopting big data analytics information management systems, personnel have clearer insight into data information. Not only does data analytics help personnel measure results, it allows them to better predict and respond to future changes.
Social computing software and technology developments help streamline fragmented data sources into a single, enterprise-wide model. This model contributes to an improved, standardized and more simplified process while helping reduce operational costs. By simplifying communication and enabling effective collaboration between disparate personnel, accelerating decision-making processes and restructuring business procedures, defence organizations are better equipped to respond quickly to changes in temporal, spatial and economic conditions.
To properly integrate big data analytics, departments must first look to increase performance through enhanced efficiencies in strategic sourcing. Currently, procurement is creating stronger relations with key stakeholders to provide better visibility, avoid greater risk and suggest creative solutions. By utilizing new strategic sourcing approaches, which include initiatives in purchasing, risk management and supplier performance designed to improve productivity, organizations can execute smarter operations.
For example, Canada’s Department of National Defence (DND) recently welcomed new Chinook helicopters, which were deployed on schedule and under budget. More than a result of effective planning, this timely and cost effective unveiling was the product of a new performance-based business model that focused on driving operational agility, efficiency and optimization to the military supply chain.
The basis of this project is the Defence Resource Management Information System (DRMIS), a military-wide SAP software that creates real-time reporting and trending capabilities in addition to integrating procurement and contracting progresses.
In the past, more time was spent sourcing and negotiating equipment parts and updating poor records; however, with DRMIS, DND members can spend more time making better business decisions more quickly and efficiently and predicting future maintenance needs.
To develop these helicopters, DND outsourced key business functions to industry partners. These functions included configuration and supply chain management, logistic support analysis, engineering change management process, technical management process and performance-based analysis. Here, outsourcing created an environment in which DND and industry partners’ systems could exchange a large amount of data, allowing the DND team to focus on its core missions.
Procurement departments have the chance to seize leadership and innovation opportunities. Applying advanced analytics helps identify new insights from the explosion of data procurement teams receive. It creates total visibility, improving internal process efficiencies while streamlining fragmented resources.
The world’s security conditions will continue to change. If we want to keep up, defence organizations must continue to evolve to improve internal performances.
David Hathaway is an IBM vice president and partner in Global Business Services (GBS) Canada and the national Public Sector Leader.