Industry integration – a new approach and attitude to Army logistics

This article was originally published in the Australian Defence Business Review ‘Land Forces 2018’ edition (September-October) and is posted here with permission. ADBR can be found at www.adbr.com.au.

By David Beaumont.

Logistics is the stored potential of a military force, and industry is the battery from which energy is drawn. For Army to be successful operationally, the integration of logistics and industry is vital.

One military theorist compared logistics to a bridge between the national economy and the battlefield, one where raw materials, goods and services are shaped through relationships and processes to achieve military outcomes. Industry is where logistics begins.

Yet there is a tendency to define the relationship between industry and Army (and Defence writ large) in terms of the introduction-into-service and sustainment of materiel, or in the provision of essential services that keeps an organisation of 45,000 soldiers ready.

The delivery of impressive new capabilities including combat and support vehicles, communications and information systems, and soldier combat equipment certainly focuses the attention of Army staff and their industry partners. This activity, though fundamentally important, reflects a portion of the relationship between Army and industry.

But we can’t forget that when Army deploys, industry contributes as a partner by supporting and resourcing Army’s logistics. This also means that when Army prepares for operations, defence industry should embark on its own activities to offer the surety that Army needs.

New Capability

Readers would likely be familiar with the Australian government’s policy direction relating to Defence and Industry.

The 2016 Defence White Paper and the supplemental Defence Industry Policy Statement continued the long tradition of following strategic intent with industry policy. Together, these documents extolled the self-evident role of industry as a fundamental input to capability (FIC),and sought to stimulate a closer collaboration between Defence and industry.

The relationship between Defence and industry may have initially been defined by the headline National Shipbuilding Plan, but there are now other projects which have the potential to capture the limelight.

Two of these, the LAND 121 program to deliver modern transport and the LAND 400 Combat Reconnaissance Vehicle, have brought the engagement between Army and industry to the fore. These programs have been linked to the idea of a ‘sovereign defence industry capability’, which simplified, is an industrial resource of such vital concern to the ADF that it must be maintained if not controlled for the purposes of national defence.

Army’s relationship with industry is not only measured by these two projects, or the many other programs to modernise the military that are currently underway. The way in which materiel is sustained and Army’s activities supported, is an equally important concern.

New Scenarios

This point was recently raised in a 2017 paper by the Australian National University’s Dr Stephan Fruhling who, in his ‘Sovereign Defence Industry Capabilities, Independent Operations and the Future of Australian Defence Strategy’, wrote of three key issues with the current paradigm of strategic thinking about industry.

Fruhling first notes that industry capabilities must relate to scenarios which apply to the force structure of the ADF, “not just consider industry as a collection of industry fundamental inputs into capability”. The relationship between industry and Army, as well as the industry options that are available and cost-effective can have a very significant bearing on force structure decisions.

This is especially the case with respect to logistics activities. For example, commercial activities might be leveraged to provide an operational effect. Army might ask whether it needs to invest in its own capabilities or arrange for stock or capability to be provided by industry ‘just-in-time’. How Army and industry prepares for this scenario is fundamentally important.

Secondly, and continuing from this point, Australia needs to look beyond a peacetime industry dependence on the US. While reliance was avoided because of the strategic policy orientation of self-reliance, he says “we must now also move to confront our dependence on US resupply in high-intensity operations”.

Global supply chains, now defined by producing commodities as they are required, can be extremely vulnerable to disruption or exhaustion, severely curtailing operations. We can be certain that if our strategic partner places a significant demand upon global commodities, the opportunity for a smaller military to resupply itself will be much less than we might hope. Industry must be ready.

Finally, Fruhling recognises that industry will be crucial to enable ADF operations in defence of Australia in the “era of long-range precision-strike”. This includes considering battle-damage capabilities in industry, as well as arrangements for “domestic base support”. In this case, Australian defence industry would have an incredibly important role in the repair and re-equipping the deployed force.

New Risks

These big strategic ideas about the industry contribution to future military operations are highly important. The devil is in the detail when ‘Sovereign Defence Capabilities’ are considered. There are, however, a few emerging questions with respect to the relationship between industry and militaries that should also be reflected upon by Army’s industry partners.

As alluded to above we are in an environment where supply chains supporting Army capability are global and complex, meaning many risks to sustainment can be hidden.

Army’s industry partners could help to reduce the opaque nature of these supply networks so we can better understand what is being produced and where. The digitisation of Army’s logistics systems, binding battlefield communications systems with modern enterprise resource planning, will come a long way to de-mystifying the supply chain. Industry might want to consider how it can innovatively contribute to solutions which give Army clarity.

Similarly, the ever-changing strategic environment will also require industry to seriously consider the scenarios in which Army, and the ADF, will approach it for support. Industry should think about its role in supporting an Army that must scale the size of its operations. Can production be increased, and can additional services be provided in the event of strategic surprise? Are there fundamental capacity issues or supply-chain problems in the sovereign defence industries that might curtail operations or limit how Army operates?

Furthermore, how can industry support in areas that Army does not have the capacity to provide itself, such as in specialist logistics, communications and other capabilities? There are real opportunities here for enterprise, where Army and industry can work together to overcome capability gaps.

Finally, there might also be a requirement to challenge the commercial notions of intellectual property, rights and propriety when it comes to a national crisis. If the maintaining of Army’s capabilities becomes financially non-viable to industry, it is essential that Army can repair and sustain its own equipment. This will be particularly important as equipment ages and nears the end of its life-cycle.

New Relationships

Of course, Army must also contribute to the relationship, and has its own obligations to industry. The relationship starts with clear and considerate language, realistic requirements and an appreciation of the commercial requirements that influence industrial capacity. Army must work persistently at all levels to effectively engage with industry partners.

Army has not always been a good partner. Some thirty years ago and in a time of the mass-outsourcing of Defence capability, Army was particularly combative in its relationship with industry. At times, its requirements can be so specific that competition and innovation in industry is stifled. This is not necessarily the case now, and industry engagement activities such as Land Forces 2018 support a renewed and active dialogue.

Army’s staff, and especially its logisticians of which a substantial portion of the service is comprised, must be trained to be able to meaningfully engage with industry and improve service delivery. We are increasingly seeing the integration of industry into Army’s daily life to the extent that commercial operations must be of a second nature to logisticians and others in Defence.

Army should continue to develop its institutional narrative and a plan that articulates its relationship with industry, and in doing so, helpfully define the future relationship. The partnership between Army and defence industry goes well beyond enduring the success of acquisition programs and product delivery. It is a partnership that is incredibly important for the success of Army in the operational environment.

As an idea, Sovereign defence industry capability should most certainly be expanded beyond its current definition to the sustainment of operations and the many other roles that defence industry performs to support an ‘Army in Motion’. Industry partners who are serious about their role in support Army’s operations and activities must consider some significant contemporary challenges.

However, Army must continue its aspiration to be a better partner with Industry; if it is not, there is little chance Army’s logistics requirements will be efficiently, and effectively, met.

David Beaumont is a serving Army officer and the thoughts here are his own. 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s