The following is a transcript of the keynote address given this past February by Cmdre Keith Coffen, Director General Maritime Equipment Programme Management, Department of National Defence at ShipTech Forum 2024. Cmdre Coffen is responsible to Assistant Deputy Minister (Materiel) for compliance with the materiel acquisition and support policies and guidelines for the life cycle support of vessels.
The Royal Canadian Navy and the supporting portion of the Department of National Defence’s (DND) Materiel Group – the Maritime Equipment Programme Division, which I lead, is at a crossroads. We have arrived at the end of service life for fleets conceived during the Cold War but delivered after it had ended. We’ve arrived without re-capitalization fleets at the ready.
The essential question before us, therefore, is how best to push our fleets beyond their designed life. In broad terms what I’ll talk about is how we got here, provide a short update on where we are now with the legacy fleets, and share a few thoughts on how to move forward.
How We Got Here
For those of us old enough to remember, we might point to two features of the 1990s that became influential. The first was the end of the Cold War and some fascination in the democracies of the world with a so-called “Peace Dividend.” The second was the debt situation in Canada and the startlingly high percentage of our tax dollar that was, at that time, going to debt service. Both pressures together led to what former Chief of the Defence Staff, General Rick Hillier somewhat infamously labeled the “Decade of Darkness.” In the case of shipbuilding, it was closer to 15 years between the delivery of the last of the current fleets and the start of the effort toward the current Naval Shipbuilding Strategy (NSS).
There were several key contributors to both the idea and execution of NSS. Amongst the more prominent figures were Peter Cairns – a fellow submariner and career Naval Warfare Officer who retired from service in the rank of Vice-Admiral as the Commander of Maritime Command (in modern parlance, Commander of the Royal Canadian Navy). Peter could easily have passed into full retirement from his military career, but he chose to continue to serve in industry where, in the late 1990s, he initially pitched the concepts that eventually became the National Shipbuilding Procurement Strategy, or NSPS, later the NSS. Another is Ian Mack, who retired from service in the rank of Rear-Admiral having served in a wide variety of senior roles, including as Canada’s Defence Attaché to the U.S.. He chose to serve for an additional decade as a civilian Director General in the Materiel Group and driving force behind the NSS.
Separated by a professional generation, these two former naval officers – supported by many other defence and marine professionals – have left an enduring legacy in the form of the NSS.
NSS itself hasn’t been easy. I think it was Vice-Admiral Dean McFadden who first coined the term ‘maritime blindness’ around 2011 describing the strategic outlook for the great majority of Canadians, who – while landlocked – lead lives that are nevertheless still shaped in ways seen and unseen by what transpires on the world’s oceans. Maritime blindness clearly extends into the industrial support base for our defence and marine sector. Too many Canadians don’t understand that our shipbuilding industries were effectively shut down in the 1990s. Too many Canadians don’t have a sense of how challenging, difficult and complex it is to restore an industrial capability once it is gone. And too many Canadians don’t understand why we can’t just stop and start production on demand, nor why it’s taking so long to hit cost, schedule and quality targets.
As one of the primary recipients of NSS output, I do understand, and my hat is off to everyone who has been inside the renaissance that is the NSS. Achievements to date have been impressive and we are just getting started. Under the NSS shipbuilding pillar, a new Offshore Fisheries Science Vessel fleet has been delivered to the Coast Guard, and the Arctic and Offshore Patrol Vessel fleet is getting tantalizingly close to completion for the Navy. Work on the Production Test Module for the Polar Icebreaker was just completed, and Joint Support Ship #1 – the future HMCS Protecteur – will launch this year. The Production Test Module for the Canadian Surface Combatant will also start production this year.
This work cannot be done without making mistakes along the way. Key going forward will be ensuring we don’t fall back to the old way of simply assuming that industrial capabilities can be kept viable without orders, and that we achieve continuity of demand, both at build and in-service. This simple philosophy may prevent recurrence of the present challenges, but it requires people who can retain corporate memory, people who can effectively manage government investments in the space and people, including partners in other government departments, who will prioritize the effort.
In fact, we should collectively be thinking about what we can do to support a move beyond constant federal demand and toward a broader strategy of diversification. Constant demand can at least ensure that there’s a minimally viable defence industrial base, but that’s a long way from providing a truly competitive marketplace from which the best goods can be acquired at the lowest prices, and from having the ability to scale up production in crisis.
The best way to push our fleets beyond their designed life is to limit the requirement to do so in the first place. NSS, in particular, is key to achieving this, but further improvement is most certainly possible.
Where We Are – Legacy Fleets
We’ve got some lessons that need to be learned on defence industrial base strategy. Letting defence industrial capabilities lapse involves significant strategic risk, and media reporting regularly shines a spotlight on our collective shortcomings. We need to move deliberately to close capability gaps in the industrial support base and to prevent new ones from emerging. The new United States Navy Chief of Naval Operations is out there talking about a “decisive decade” ahead. What is worth noting as we reflect on her remarks is where the Canadian Surface Combatant will deliver in that decade – the very first ship at the very end of the period she’s concerned about. That’s the project that is in the best shape across our legacy fleets.
Halifax class
In terms of the immediate issues with legacy fleets, it is the Halifax class maintenance programme demand that we’re feeling most acutely at present. Non-discretionary scope growth in recent Halifax class Docking Work Periods (HCDWP, or just DWP) – work absolutely required to ensure that the ships are safe and operationally relevant against modern threats – has been immense, and there is very little room for manoeuvre to mitigate cost and schedule impacts.
Simply as a function of the time required to conduct the necessary maintenance, we should expect reduced availability from the Halifax class in the future. The best we can do is mitigate the decline – we cannot arrest it fully. With the induction of a third HCDWP shipyard, DWPs are currently taking 18-24 months to execute, compared to four to five months when the ships were new. We also altered the maintenance profile from the 60-month (60M) cycle inclusive of DWP time to one that is premised on a 60 month ‘operational’ period followed by a variable period in DWP preparation, DWP, and post-DWP restoration to service. Both measures together support better availability for this fleet than would otherwise have been the case, but it will be less than earlier in the life of the class, and the trend is downward.
Apart from the ‘time in maintenance’ challenge, opening a third shipyard increased the requirement for cash flow to fund the Halifax class maintenance programme. Further changes in the demand for funding resulted from in-service support requirements for systems installed under the Halifax Class Modernization/Frigate Life Extension (HCM/FELEX) project and from a shift to a more industry-centric, in-service support approach across Naval fleets as demands increased at each Fleet Maintenance Facility. Additionally, underlying economic factors, especially in the aftermath of the COVID pandemic, more acutely felt in shipbuilding and ship repair than in the broader economy, are putting further pressure on the programme.
To help address both cost and time pressures in the DWPs, we established a Canada-Industry Integrated Project Team (CI-IPT) including representatives from my Division, Public Services and Procurement Canada (PSPC), all three shipyards and both Fleet Maintenance Facilities to exchange best practices and serve as a clearing house for ideas to improve the efficiency of both spending and program execution on Halifax Class DWPs.
The challenge here is very high and growing. Overall, I expect it will demand quite a lot of attention in the coming years.
Victoria class
Unlike the Halifax class, the materiel certification regime for the Victoria class does not permit much latitude in controlling the scope of the repair effort in our Extended Docking Work Periods (EDWP). Unlike the Halifax class, which is feeling the shock of non-discretionary repair only now, in the Victoria class we felt it almost immediately. The driving constraint is our overall capacity to manage the maintenance demand. Two key pinch points are the availability of expert submarine engineering resources who can guide work, and the availability of sufficient shipyard capacity to avoid having submarines backlogged waiting for third line maintenance. Issues with overall reliability, supply chain difficulties given both the origin and the ‘orphan’ nature of this fleet, and our capacity to cope with the second line maintenance demand have further compounded the challenge.
Like the Halifax class, this fleet will operate well beyond its intended design life. Although the Victoria class acquisition was only intended to bridge Canada’s submarine capability until such time as a more permanent solution could be found, the Canadian Patrol Submarine Project is only just getting started, meaning further challenges lie ahead.
Kingston class
We’ve been relatively fortunate with the Kingston class. The smallest and least complex of the ‘operational’ fleets, the Kingston class has the same trend as the Halifax class in respect to its maintenance requirements, however, we are still well able to cope with the demand on a 60M cycle. Its challenge is the transition from the Minor Warships and Auxiliary Vessels (MWAV) III contract to MWAV IV, which involves moving from an established incumbent to a new entrant. That said, the Kingston class, like the Halifax and Victoria classes, is now operating beyond its designed life. While we are better able to cope with changes in demand for this fleet at present, there is a need to bring a Kingston class replacement project into Definition phase.
Auxiliary classes
There are other smaller recapitalization requirements for auxiliaries as well. We have the Naval Large Tug project underway to provide replacements for Canada’s aging Glen class tugs, and we have a requirement to recapitalize the small but mighty Orca class fleet. While the Orcas are relatively new compared to the other fleets, they have a very high usage rate as training workhorses and are increasingly showing signs of wear and tear. Consequently, there is a need to move forward with a recapitalization project for the Orca fleet in the very near term.
How To Move Forward
So, what would I offer as key principles to apply to make the best of the situation we are in?
1. Mission Focus
Against all of the day-to-day pressures, cash flow and Human Resource management, commercial, programmatic, and risk-management decision making, we must all remember what our work is for and why it is important. At the end of the day, the work we all do supports a free, peaceful, prosperous, and democratic Canada now and into the future. No other interest – personal, private, corporate, or commercial – should ever come before the national interest as defined by the duly elected federal government. Within that objective, the priority should be the lives and well-being of Canadian Armed Forces soldiers, sailors and aviators sent on missions in support of the national interest.
The Navy’s motto of People First, Mission Always is appropriate in this respect. Mission Focus for defence procurement specialists and the supporting industries means making Canadian Armed Forces end-users our focus, ensuring that the goods and services we provide to them are safe, operationally relevant and fit for purpose – and that they are provided in a timely way, at fair cost, and at high quality.
2. Honesty
It does no one any good to sugar coat a challenging situation. But it’s important not to be overly pessimistic. Unchecked pessimism can destroy morale, impair motivation, and impede either starting new initiatives or staying the course when things are hard. Boundless optimism isn’t particularly helpful either. Optimism bias is an ever-present risk, creeping into our decision making and leading to the establishment of unattainable objectives that result in unmet expectations, fair criticism, and unwanted scrutiny.
Being overly optimistic or overly pessimistic can interfere with prioritization of effort and resource planning and can erode trust. By contrast, conservative and objective assessments informed by the best quality information, including an honest appraisal of challenges and limitations, facilitate reasonable expectation-setting and credible resource planning.
3. Open Dialogue, Empathy and Collaboration
We need to be able to talk about challenges, pinch points, and potential solutions. We need to be able to challenge ourselves and one another to develop a truly shared awareness of challenge and opportunity. We may not always agree, but success requires the ability to have hard conversations while maintaining respect and professional courtesy. When done well, collaboration will translate to win-win outputs.
Of note, in recent years we’ve increasingly used relational contracting principles, codified into relationship charters, when the work is complex or when the definition of success is ambiguous. These charters describe specific behaviours used to build positive relationships and collaboration rather than encourage highly transactional contracts whose objectives may have been set without adequate protection against optimism bias. While not always necessary, nor a guarantor of success, relational contracting can be good risk mitigation when things get tough in a complex business relationship and can help stakeholder organizations get back on track.
4. Professionalism and Ethics
Maintaining appropriate professional relationships should be foundational to the ethics of the defence procurement community. We would all do well to look at what we’ve communicated as expectations within our own teams, the extent to which we have codified expectations with one another, and whether there are gaps to address. As we all learn from those bad situations that do happen, I would simply offer that the defence business is a sacred trust grounded in the national interest, as well as the safety and security of CAF people.
5. Innovation
The noticeable shift in the maintenance requirements of our older fleets indicates that sticking to traditional business practices will no longer suffice. Innovation in the technologies we use and the processes we follow will be vital to widen the space for decision-making and improve outcomes on schedule, quality, cost, and platform availability. To facilitate innovation within the technical domain, the Naval Technical Innovation Program (NTIP) was established a few years ago and has proven quite successful in providing an effective means to assess innovative new technologies and leverage grant money available through Government-funded innovation programs. A wide array of interesting new technologies are being explored under the NTIP in partnership with several Canadian companies. For example:
• exploring the development of an autonomous underwater signature ranging capability that shows potential to provide the RCN more geographic flexibility for signature rangings;
• leveraging artificial intelligence to identify corrosion on the upper decks of our ships in a fraction of the time it would take using traditional manual methods; see the Maritime Engineering Journal for more information; and,
• testing new technologies on chartered commercial vessels to significantly lighten the constraints around using RCN vessels as test platforms and enable us to evaluate more new technologies more rapidly.
My central message is that the best solution on pushing our fleets beyond their design lives is to plan around the problem entirely. But if you’re stuck having to extend, my next best advice is to focus on people. Fleets and platforms are the ‘what,’ but it is people who are the ‘why’, the ‘how’ and most importantly, the ‘for whom.’