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Defence Materials Technology Centre Conference keynote speech

Brad Yelland, BAE Systems Australia
The recent and planned Government investment in modernising the Australian Defence Force is pretty significant. I don’t think anyone in this room would deny that.

Brad Yelland - Chief Technology Officer, BAE Systems Australia

 
I am the CTO of BAE Systems Australia, as Mark said. I’ve worked in the defence industry for well over 30 years, I’ve worked in the US and the UK. What I’d like to say is, right now is a pretty exciting time to be in the Australian defence industry – everyone in this room should be pretty excited about that. It’s also a pretty exciting time to be CTO of BAE Systems Australia, but there’s also a lot of challenges out there.
 
So, I would like to use this opportunity today just to start the Conference by throwing a few insights, observations, criticisms out there in the hope that might start some conversations over the next two days and hopefully beyond that.
 
But I will also use this opportunity to explain some of the challenges facing BAE Systems Australia, and why we see put such value in our relationship with DMTC.
 
The recent and planned Government investment in modernising the Australian Defence Force is pretty significant. I don’t think anyone in this room would deny that.
 
When you combine that with the focus on development of the Australian Defence Industry as a Fundamental Input to Capability (FIC) and the investment that brings into innovation and technology, then this is exciting.
 
BAE Systems Australia has secured leading roles on Major Programs such as:
  • Design and Build of the Hunter Class Frigate program
  • Major upgrades of the Jindalee Over the Horizon (JORN) radar network; and
  • Setting up for both national and regional F-35 Joint Strike Fighter support tasks.
That’s pretty exciting too. So an exciting time to be in Australian defence industry, and an exciting time to be in BAE Systems.
 
 

Challenge

 
I spoke here a few years ago at the 2017 DMTC Annual Conference, it was just after Government & Defence had rolled out the Defence Innovation System initiative. That was an initiative that brought together the Next Generation Technologies Fund, the Defence Innovation Hub and the Centre for Defence Industry Capability as the mechanism to inject $1.6bn over the next decade into the development of the defence industry in Australia.
 
At that time there was great excitement about the future prospects.
 
And while there has been huge progress made in putting major acquisition contracts in place, particularly compared to the sparse years leading up to the 2016 White Paper, and those opportunities creating opportunities for industry and creating lots of jobs in Australia – in the same timeframe, the ability for industry to access the Defence innovation system has proven difficult. So, I’d like to  challenge the audience here to come up with a consistent definition of what “Industry as a Fundamental Input to Capability” really means, and how we can use it, and to think of examples of where that has actually been enacted. I’ll come back to that later.
 
While the idea behind the Defence innovation system is a great idea, and again I really applaud the boldness and the intent of the Coalition Government in doing that, the process that underpins it lacks the innovation needed to allow the Defence end user, Australian Industry and the nation to truly take advantage of this bold initiative.
 
There’s a constant obsession with probity, IP ownership and competition at all costs. And that is a process that reflects a general lack of trust. The months of negotiation needed to get Ts & Cs in place – and just right – feels like strangulation, to the point where sometimes we actually think “Is the effort required really worth it?”
 
If we had a clearer definition and understanding of what “Industry as a Fundamental Input to Capability“ actually meant, at all levels and across all parts of the customer and industry, then we might find it a lot easier to tailor and change the old processes and behaviours to achieve the desired result, and to build the trust needed between the various parties, to achieve the outcomes we desire.
 
I think also, an important point is to leverage what has already been proven to work, as the basis for the model going forward, then we will give ourselves the best chance to get the benefit from this bold initiative.
 
The reason I am pleased to be talking here today as the keynote speaker at this Conference is because, from BAE Systems’ experience of more than a decade of working with the DMTC Model, we think this is a model that really works.
 
The DMTC model has proven successful in bringing Industry, Academia and Defence together with a clear common focus and with the flexibility required to be agile.
 
It would make my job as CTO a lot easier if the DMTC model was used more widely across the Defence technology and innovation investment programs.
 
It is for this reason that BAE Systems Australia is strengthening our already strong relationship with DMTC, bringing them into the fold for the significant technology development activities associated with the Hunter Class Frigate Program.
 
 

So, what is the Hunter Class Frigate Program?

 
The Hunter Class Frigate is the Australian derivative of the BAE Systems Global Combat Ship, which is also, in its various derivatives, the future Anti-Submarine Warfare Frigate for the Royal Navy in the UK and the Canadian Navy. It’s the world’s most advanced Anti-Submarine Warfare ship.
 
Securing the Hunter as the ship of choice for the Sea 5000 Project requirements is a huge bonus for Australia.
 
Not only will it give our Navy superior ASW capability at a time when it will be a high priority for Defence in Australia and the region, but it will mean that the RAN will have nine of a total fleet of 32 Global Combat Ships, providing the opportunity for Australia to work closely with our closest allies to continue to develop ASW capability.
 
It will also provide Australian Industry with significant export opportunities. There is a lot of commonality between the ships for the UK and Australia and Canada, and that commonality goes down to the supply chain as well. There is a lot of opportunity for defence export out of Australia.
 
The Hunter Class Program is a program to design and build nine ASW Frigates for the RAN, but it is actually more than that.
 
It is a program that is will focus on:
  • growing Australian Shipbuilding,
  • creating a continuous Australian shipbuilding capability,
  • growing Australian jobs (in fact, we are going to grow 1,000 new apprentice and graduate positions over the next five years, which is quite significant) and going some way to replacing what we have lost with the demise of the car Industry in Australia
 
But it is even more than all of that.
 
It is creating opportunity for Australia to:
  • develop technologies and capability to be at the forefront of ASW, Shipbuilding and ISREW; and
  • create export opportunities to strengthen the Defence Industry in Australia
 
BAE Systems Australia has committed significant investment in capability and technology as part of the Hunter Program. Our Australian Industry Capability Plan was one of the strengths of our Sea 5000 proposal and now we are focused on implementing it.
 
We will establish a truly Digital Shipyard that is going to transform the way we build ships in Australia, putting us in the position of a world-leading shipbuilding nation.
 
Our design and build techniques leverage the digital world through our virtual ship concept - Supporting shipbuilding at all phases of the lifecycle from Design and build to Through Life Support. This capability has been developed in the UK through decades of progressive work starting on the QEC future carrier program, on to the offshore patrol vessels and is now being implemented on the GCS Type 26 program, all the time being matured as it goes. In this way Australia is lucky enough to get a very mature approach to digital shipbuilding. This capability is being transferred, in full, from the UK and when I say “in full” that means the complete transfer of all our IP. This gives Australia a great opportunity.
 
We have already established relationships with Australian Universities through this program with a focus on shipbuilding of the future, leveraging such concepts as Factories of the Future and Industry 4.0.
 
Through this, we have facilitated relationships between Australian Universities and those in the UK doing similar research and capability development, which further strengthens our transfer of capability into Australia.
 
Our relationship with DMTC will play a significant role in realising our Hunter Australian Industry Plan.
 
As part of the Shipyard Mobilisation and prototyping build phase, starting towards the end of 2020 / early 2021, we will be building a number of Hunter platform modules. Like all modern ships the ship is built in modules of varying complexity, and part of this process of prototyping and mobilising the shipyard is to start with simple modules and gradually lift the complexity.
 
To get additional value out this exercise, what we are doing is offering one or more of these modules to DMTC to use as a platform or test bed for shipbuilding capability and technology development activities in shipbuilding.
 
As an integral part of this exercise, and a priority objective, Australian Industry will be invited to put forward proposals on how they can leverage this opportunity, working with DMTC and BAE Systems:
  • to develop their capability and technologies,
  • to showcase themselves to the Hunter Program, and importantly,
  • to position themselves for export opportunities into the UK and Canada, and even wider than that because shipbuilding goes wider than just the Hunter / Global Combat Ship.
 
All of that sounds pretty exciting to me. Lots of good opportunities there.
 
 

Challenges for BAE Systems Australia

 
There is also a few challenges. I want to just talk about the number one challenge that’s facing BAE Systems, and in fact I think anyone here in industry would recognise this as a pretty significant challenge.
 
The number one challenge is how to get the resources – how to get the skilled workforce we need to take advantage of the opportunity being offered through the Government investment in modernising the Australian Defence Force and growing the Australian defence Industry.
 
We are investing heavily in things like diversity and inclusion to increase the pool of resources available, in STEM initiatives to increase the interest from young students in maths and sciences and positioning them to get into the engineering world. All of that is to improve the pipeline and make Defence Industry a great place to work with fantastic career opportunities. That’s a pretty long-term approach, it’s not going to solve the short term issue.
 
We know this is a challenge that BAE Systems on its own can’t address, we can’t do it organically.
 
We need to encourage Australian defence industry, to embrace collaboration. To break down some of these walls we see all the time, that force competition and make it unnecessarily difficult around probity and that sort of stuff. Let’s truly embrace collaboration. I’m not just talking about the big primes, I’m talking about SMEs, academia and other research organisations. We all need to work together to ensure we’ve got the resources, so that Australia can take advantage of this boom we’re currently in.
 
As a prime contractor, we need a strong Australian supplier base.
 
As a prime we need relationships with Universities and Colleges that encourages the generation of graduates and trades that can service the Defence Industry.
 
And as a prime we need to support the ongoing development and strengthen the future outlook of Australian SMEs.
 
BAE Systems Australia currently procures around $400 million per annum through our Australian supply chain – that’s around 70% of our total procurement that goes through the Australian supply chain.
 
That adds up to supporting more than 1,600 Australian Suppliers. That’s already a significant amount but it’s going to need to increase and that is why collaboration is needed.
 
It is going to need to increase as we bring on Hunter, F-35, JORN and others.
 
 

Closing

 
DMTC, in my view, is a very important link in the chain to secure success for Australian Industry.
 
DMTC provides access for Australian SMEs into project-focused programs. It improves BAE Systems Australia and other Primes’ knowledge around what the Australian Supplier base can offer.
 
It facilitates the establishment of long-term relationships between Defence, industry and Academia.
 
On that note, I would like thank DMTC again for the opportunity to provide this speech, and I would like to encourage all of you here to use the next two days to learn more about Australian industry capability and explore opportunities to further the cause of:
  • Growing the Australian Defence Industry
  • Creating Australian Jobs
  • Contributing to the financial health and security of our nation,
through effective collaboration, that develops Australian technology and capability.
 
Thank you.