The announcement about six months ago of the creation of a Defence Investment Agency (DIA) was feted by all, after decades of disappointment with the performance of the Canadian current procurement system for major weapon systems. The amount of ink spilled over the shortfalls of the current military weapons systems platform acquisition system is legendary.

This agency is meant to address all major weapon system acquisition projects estimated at over $100 million, with a primary goal of speeding up equipment delivery.

The DIA faces a mountain of issues: negotiated legislation to provide authorities, a plan that appears solely focused on the transfer of acquisition projects, accommodation with room to grow dramatically, process re-engineering, relaxed risk management guidelines, the hiring of skilled support personnel across a spectrum of functions with emphasis on human resources and public relations (internal to DIA and external to the government), the creation and hiring for many specialized centers of excellence, establishing tailored and effective governance and perhaps the most challenging task of negotiating the transfer of hundreds of personnel involved in major weapon systems procurement into the DIA.

The ‘to do’ list is long, and the planning will be complex. Qualified project managers are available from the Department of National Defence (DND) to lead this complex transition project, with an execution team significantly supported by contractors hired in a hurry. As an estimate, this transition project will run five years or longer.

I see two specific immediate and linked dilemmas: who the agency reports to, and how it relates to other involved organizations.

Reporting Structure

As already mentioned, the current strategy for standing up the DIA focuses on improved accountability by bringing together all those involved in major defence acquisition projects from the departments and agencies involved. This includes personnel from Public Services and Procurement Canada (PSPC), DND (likely the largest transfer of personnel) and Industry Science and Economic Development Canada (ISEDC). Less clear is whether a new relationship with the Treasury Board (TB) will also be pursued, something I consider essential.

The first dilemma is simple. Accountability in its purest form would see every task in such acquisition projects assigned to the DIA without exception. However that would include the requirements definition which resides in DND and is assumed to be unlikely to be transferred. If this assumption is valid, the creation of the DIA will recreate boundaries with DND where the expertise exists to shape important aspects of the project. And as every engineer knows, efficiency is lost at every piping and system connector.

Currently, the agency is ‘housed’ in PSPC. This is a common approach for many agencies, which are at ‘arm’s length’ to a government department that provides guidance and funding as a minimum. This home-porting in PSPC may have been done to reduce friction during a prolonged transition, since PSPC now controls the senior governance of all such projects.

Such a parent department arrangement could have been instituted with DND rather than PSPC. As mentioned above, it is assumed that DND will continue to develop acquisition project requirements that relate to three key areas: the operational user’s needs, the technical translation of those needs to best assure effectiveness on delivery, and the in-service requirements that enable decades of successful readiness. As well, the technical expertise of such projects is provided by the Assistant Deputy Minister of Material in DND throughout design and construction, and relating to in-service support.

This raises a number of observations:

  • Most nations house all disciplines in the equivalent of DND: the three key requirements areas, contracting, oversight and the equivalent of industrial and technical benefits (ITBs – an economic development requirement that a number of western nations with mature procurement practices have done away with). Note that all but setting operational requirements are embedded in project management teams.
  • Moving the authorities for establishing the operational users’ requirements into the DIA housed in PSPC would create boundaries in accountability between the Service Commanders who utilize the delivered military equipment and the execution staff in DIA. This would occur whether Operational Requirements Managers (who represent and liaise with the Chiefs of Service) are included in the project management execution offices because the trade-offs during execution are many in the more complex projects.
  • In terms of timing and as seen with other allies who created similar organizations, DIA may evaluate the initial requirements and their technical translation as non-viable for contracting success, creating a stalemate that has in other nations lasted months and in at least one case led to the agency’s demise when such disagreements became common.
  • A similar decision-making issue could arise when establishing the ITB portion of the scoring for the bid evaluation of responses to Requests for Proposals (RFPs). Based on the current government’s often voiced desire for sovereign control achieved by maximizing long term jobs in Canada, this could potentially become the determining factor in preferred bidder selection and lead to serious time lost to resolve conflicts.   
  • Whether at the RFP stage or once in contract, my experience has been that Ministers defer to each other rather than get involved in major disagreements. This in the past has consistently meant that PSPC has had the upper hand once contracts were in discussion and later in place. Similarly it can be assumed that DIA will be the default decision-maker in major conflicts involving contractual matters or industrial benefits. The Minister of National Defence may voice an opinion, but the Minister in charge of the DIA will likely hold the hammer.
  • To the best of my knowledge during my decade with a portfolio of major platform acquisition projects for the Royal Canadian Navy and the Canadian Army, such disagreements were never referred formally to the Prime Minister for adjudication.

While this scenario built on past practices may not emerge with the maturing of the DIA, this concern should be acknowledged at the outset. Guardrails should be enshrined in new government legislation that addresses the essentials. Three such safeguards are offered below:

  • Appropriate authorities should be assigned which clarify accountability, best achieved by employing detailed Service Level Agreements complete with RACI diagrams.
  • There should be recognition that major disagreements between parties could occur. These should be arbitrated by convening external conflict resolution bodies whose reports would be non-binding on the government but that should be made public.
  • A mandatory review of organizational authorities should be conducted within a decade. This could lead to a number of potential outcomes: confirmation of the status quo structure, transfer of the DIA to DND, the establishment of DIA as a separate government entity reporting directly to the Prime Minister, or the creation of a hybrid DND/industry commercial unit reporting to a either the Minister of PSPC or DND. While changes in the machinery of government are rare and preferably avoided, such a review is warranted given the high stakes in the Canadian Armed Forces. Noting as well that it may soon be transitioning to a wartime footing.

Relations With Partner Organizations

It is likely that the DIA has currently little more than a temporary mandate to start accelerating major military weapon system and related platform acquisition projects, pending new legislation. One can assume that it is currently operating with delegated authority from the Minister of PSPC, and will continue to do so for an extended period of time until legislation is developed and approved.

Such major changes in the machinery of government have seen implementation challenges, the stand up of Shared Services Canada likely offering lessons worth understanding. Those in charge of new organizations who emphasize to all that they have the authority of the Prime Minister to move quickly to hire the ‘best’ from other departments have been seen in the past as predators facing major obstacles to progress everywhere. Neither the Secretary of State for Military Procurement nor the new CEO of the DIA has relationships or longstanding reputations to fall back on with other ministerial colleagues in DND, ISEDC or TB – or their staff.

Hence the other critical dilemma: the Prime Minister has messaged that he expects early results but the usual mechanisms to facilitate such actions at speed are absent. And at a time of government-wide downsizing, the negotiation of who moves to the DIA will see additional legitimate concerns that could slow progress.

The solution is relationships based on adopting a systematic working approach to creating and maintaining structured and aligned collaboration across all involved organizations. Such capabilities have not been comprehensively put in place in government, despite the fact that it is now a well appreciated technique when pursuing complex endeavours.

There is much to establishing such collaboration, as Thales has seen with its application to their collaborative in-service support agent contract with the RCN for the Arctic and Offshore Patrol Vessels (AOPS) and the Joint Support Ships (JSS). But two collaborative enablers stand out at this point for success: teams that practice joint-working across organizational boundaries on a day-to-day basis, and formal structured stakeholder management. I have covered both in detail in papers I have authored in the past.

Why It Matters

I need not lecture readers about the deteriorating geopolitical realty of the volatile and uncertain and complex and ambiguous (VUCA) world we live in today, or the need for Canada to pull up its bootstraps in the defence portfolio before we find ourselves walking on hot coals.

To date, I have seen nothing to indicate how the fledgling DIA is progressing, nor the barriers it faces. I am only owed such insights based on the transparency that is expected in Canadian democracy, as a citizen of Canada and as someone who cares after dedicating 48 years to our nation, both in uniform and in the public service. And I am not alone with this perspective.

Astute observers know what happens to good ideas and strategies that have no effective and appropriate plan for such a complex transition project. They somehow either take years to launch or die, being overtaken by higher priority events.

As 2026 dawns, I implore the core team at the DIA to at least signal their immediate goals in terms of target milestones and dates. As I have said elsewhere, the DIA is too important an initiative to fail and especially as a critical readiness lever in moving Canada towards a wartime footing.

And because it is always about the people, these two dilemmas matter.