Failing to learn from Australia’s most successful defence project

William P. Hall President Kororoit Institute Proponents and Supporters Assoc., Inc. - http://kororoit.org Documentation & Knowledge Management Systems Analyst (Ret.) Tenix Defence william-hall@bigpond.com http://www.orgs-evolution-knowledge.net

Access my research papers from Google Citations

SIRF 2nd KM Roundtable 2015, South Melbourne, 26/5/2015

After profitably completing 10 ANZAC Frigates on-time, on-

budget

3 Air Warfare Destroyers are $2 Bn over budget & 3 yrs

late

—

Why?

Greg Sheridan in the Australian 22 May 2015 - Warships cost blows out to $9bn

Tenix Defence’s $7 BN ANZAC Ship Project was the most successful Defence Project in Australian History

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Late 1989-2007 built & delivered 10 modern frigates – 8 to the Royal Australian Navy – 2 to the Royal New Zealand Navy – Different customers, different languages, different systems – Plethora of engineering changes affecting everything – Stringently fixed price contract & delivery schedule – Required to achieve 80% Australia/New Zealand content – Fixed acceptance dates, major penalty/warranty clauses

How is ANZAC’s success measured? – Every ship on time – No cost overruns – Healthy company profit ! A success by any standard! – Happy customers – A project you probably never heard of (no bad press)

Tenix auctioned its Defence assets in 2007 because it could not complete a $500 M project for New Zealand

What did the “Marine Division” do?

In the mid 1980’s, except for fishing boats & tugs the Australian shipbuilding industry was effectively dead

– Two part completed Adelaide class (FFG Frigates) rusting on slipway of the gov’t owned/managed Williamstown Naval Dockyard

– Labor productivity was close to zero – Thuggery, theft and fraud were rampant in the dockyard

Privatized by AMEC AMECON Transfield Defence Systems Tenix Defence Systems Tenix Defence

– Bid for and won ANZAC Ship Project (ASP) – Completed engineering design & production planning – Negotiated $BNs of subcontracts from weapons systems to paint – While successfully completing 2 rusting FFG hulks – Mobilized an excellent team for ANZAC – Completed design & engineering based on German MEKO 2 – Built & managed crew training facilities – Began tech data/production of entire documentation suite – Successfully completed 10 ANZAC Frigates on time, on budget,

healthy company profit, happy customers 4

The ANZAC experience shows Australians can build ships

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Hugely demanding project – Complex/ever-changing engineering demands (engineering changes!)

– ANZIP requirements to use local industry

– Life-cycle costing

– Test, Evaluation and Validation requirements: 10 ship years

– Fixed price for everything - including crew training, operator manuals, technical data/documentation, logistic support & spares

Mistakes made, lessons learned – Hard lessons in what didn't work led to solutions

– In-house R&D with innovation rescued bad situations and still showed a profit

Benefits maximized with locally developed solutions – Reduced costs and risks

– Allowed guidance of IP development to meet our needs

– Informal and formal partnership opportunities (the "home team")

Neither the company nor Defence seem to have learned anything from the ANZAC success

Tenix failed to complete its next significant project – $500 M to complete 7 simple ships for New Zealand

A RO-RO transport

2 offshore patrol vessels all to Lloyds commercial certification

4 inshore vessels

– A year into the project it was clear the company was way over budget and would finish years behind schedule.

– Owners auctioned all (~$1 BN) Defence assets in 2007 to escape

Today: Government-owned ASC the lead shipbuilder for $8 BN build of 3 Air Warfare Destroyers

– (Ex) Defence Minister David Johnston 25 Nov. 2014, “ASC couldn’t build a canoe”

– AWD now ~ $2 billion over budget, 3 years behind schedule and probably still sinking

– Australian shipbuilding headed for a “Valley of Death” around 2020 where there will be no active projects to maintain skills

Government working to send future Defence work offshore 6

}

My involvement in the story

Qualifications as an observer

Background – PhD Evolutionary Biology (Harvard 1973)

– Migrated to Australia

– 1980-1989 Operated word processing bureau to pay for my own setup

Became interested in impact of personal computers on people

Computer literacy education & journalism

Tech communicator & documentation manager software house

– Corp Services tech writer & doco mgr for Bank of Melbourne

1990 – 2007 Tenix

2001 started sporadic work on hypertext book exploring co-evolution of human cognition & technology

2010-2011 course dev’t with EA Principals incl. gaining TOGAF® 9 enterprise architecture certification 8

AMECON Tenix Marine Division

Shipbuilding specific - Jan 1990 to ~2000 – Documentation systems analyst-designer

(Commercial) T&C flowdown from prime contract to subcontracts

(Training) computer literacy, electronic file standards & retrieval

(ILS – support engineering) – Contract analysis for documentation delivery

– Contract amendment to replace paper deliveries with electronic

– Contract analysis for ship TE&V and Operational Availability Recording and Reporting requirements

– Analysis & design of OAARSystem to prove Tenix met AO requirements

– Design of 3 generations of authoring & electronic delivery systems for electronic tech data & documentation (e.g., knowledge of how to maintain the ships usable by computers & people)

– ILS & Systems Engineering representative on Shipbuilding Systems Project to implement enterprise resource planning system (failed)

– ILS & Systems Engineering rep on implementation of Product Lifecycle Management system (partial failure)

– Bid team support (documentation controller / expert)

– Opportunity analyist (KM products / services) 9

Tenix Defence Head Office ~2000-2007

Leader of Requirements and Contracts Engineering (RACE) Online to promote XML standards for Defence tenders and contracts

Designed state of the art PLM system for Tenix Land (M113 UP)

Under GM Strategy & Development (soon disbanded) – Co-leader audit of engineering software applications & requirements

– Team leader corporate knowledge management audit

KM Analyst in Engineering Head Office under R&D Manager – Heavy involvement in implementation of corporate KM Portal (LiveLink)

– KM policy development

– Involvement in developing content management proposals for Tenix’s “shipbuilder” bid for the AWD project to cope with Defence’s proposed consortium structure for the project

– Facilitated development of cross-divisional CoPs for engineering/ILS

– Sponsorship & guidance for two interns completing PhDs in KM areas

– Development & prototyping (with KM intern) a knowledge mapping and sharing strategy for transferring critical personal knowledge from ANZAC Ship Project to NZ Project Protector

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Key papers describing lessons (not) learned [click underlined title for full paper]

[Document management] Hall, W.P. 2003. Managing maintenance knowledge in the context of large engineering projects - Theory and case study. Journal of Information and Knowledge Management, 2(3), 1-17.

[Data] Sykes, M. Hall, W. P. 2003. Generating fleet support knowledge from data and information. Australian Conference for Knowledge Management & Intelligent Decision Support ACKMIDS 2003 Melbourne, Australia, 11 and 12 December 2.

[Product Lifecycle Management] Hall, W.P. and Brouwers, P. 2004. The CMIS solution for Tenix's M113 program. MatrixOne Innovation Summit. Shangri-La's Rasa Sentosa Resort, Singapore, 12 - 14 August, 2004.

[Project Management] Hall, W.P., Richards, G., Sarelius, C., Kilpatrick, B. 2008. Organisational management of project and technical knowledge over fleet lifecycles. Australian Journal of Mechanical Engineering. 5(2):81-95.

[Personal knowledge] Nousala, S., Miles, A., Kilpatrick, B., Hall, W.P. 2005. Building knowledge sharing communities using team expertise access maps (TEAM). Proceedings, KMAP05 Knowledge Management in Asia Pacific Wellington, N.Z. 28-29 November 2005.

[KM failures] Hall, W.P., Nousala, S., Kilpatrick B. 2009. One company – two outcomes: knowledge integration vs corporate disintegration in the absence of knowledge management. VINE: The journal of information and knowledge management systems 39(3), 242-258.

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One organization

—

three generations

two eras

1956 – 1988: Prelude

1989 – 2000: Mobilization & expansion

2001 – 2007: Closeout & failure

2008 - 2014: Extinction

Three generations of Sydney-based family companies

Transfield Holdings 1988-1995 (private partnership) – Founded 1956 Franco Belgiorno-Nettis & Carlo Saltieri

– Engineering projects (infrastructure & plant maintenance)

1988 Transfield Defence Systems founded to bid on ANZAC

1989 Sons, Paul Salteri & Franco Belgiorno-Zegna, MDs

1996 Gen 2 family differences split company – Defence assets to Salteri; remainder plus Transfield name to Belgiorno-Nettis

1996-2001 Paul Salteri expanded from Marine – Tenix Defence: + aerospace, + land, + electronic systems

– + civil infrastructure, + civil aviation, + computer systems development, + local government data mgmt

2001 Robert Salteri (3rd generation) appointed as CEO – 2007 auctioned “some or all” Tenix assets, finalized sale of all

Defence assets to BAe Systems early 2008

– 2014 last infrastructure maintenance assets sold to Downer EDI 13

Marine born in 1988 as an innovative new organization soon acquired by the family company

Eglo Engineering with Dr John White lobbied to start Submarine project & joined a failed bid to win the Collins Class contract

In 1986-7 Eglo formed AMEC as a publicly owned consortium with ICAL, & (W) Australian Shipbuilding Industries to bid on pending ANZAC Ship project

– Late 87 AMEC won bid to privatize dysfunctional Williamstown Naval Dockyard in competition with private Transfield Defence Systems

1988 Transfield acquired all AMEC stock and renamed company to AMECON in early 88, retaining some staff from Eglo & Ical

Under Dr John White AMECON closed Dockyard – Terminated all Dockyard labor & management staff

– With ACTU agreement, replaced 23 unions, 30 awards & 390 classifications with 3 unions and 1 award and 2 classifications

– Rehired selected dockyard people of “good reputation” and many years of living knowledge

– Recruited / contracted engineering talent needed to bid/design ANZACs (other industry, Navy, overseas) 14

1989 – 2000

— Mobilization & Expansion

“good times” in Marine while owners

& executives were occupied with family feuds and acquisitions

John White (from Eglo) turned dysfunctional WND into internationally competitive shipyard on its 36 acre (14.5 ha) site

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Sheet steel & components in

Completed ships & operating knowledge out

Modular construction – Big components easy to

install in modules before consolidation

– Module construction could be subcontracted out

Defence systems started with the “Marine Division”

High turnover (generally < 3 yrs) in Williamstown senior mgmt – Hired to manage specific project phases

– No tolerance for “mistakes”

– No opportunity to learn corporate history or “on the job”

– Once the work was mobilized, senior management contributed little to effective workings of the ANZAC Ship Project (“ASP”)

Marine used as cash cow to support acquisitions

Engineering, technical and production staff were the “heart” – Plenty of 10 & 15 year pins (e.g., select staff from WND)

– Proud/excited to be designing, building & supporting Australian ships

– Major family turnouts to watch their ships being launched

– Worked and often socialized as teams

– Actively worked to understand what the Contract required

– Made mistakes, identified problems and solved them

– Worked very long hours to ensure project success

Large component of self- and emergent-management 17

Unique aspects of the ANZAC Ship Project Contract helped to determine how the organization worked

Client project authority was bi-national (nationally variant ships) Contract specified capabilities to be delivered not specific

products/systems 80% Australia /New Zealand Industry Participation by value Foreign (German) design to be engineered & built in Australia Fixed price contract (1989 $ with escalation) / fixed schedule

– Ships & systems – Shore based simulators, & complete ship crew training package – Logistic support costs

Initial consumables + supply chain/rotable pool/insurance spares Complete technical data / operational and maintenance documentation

deliverables

Warranty requirement to prove over 10 ship-years that ships were operationally available (AO) at least 90% of time

– Major test of design, engineering, training, maintenance knowledge – Tenix required to develop acceptable methodology to prove this

Major liquidated damages for schedule milestone breaches 18

Problem areas requiring development & deployment of specialist knowledge

Solved major problems & issues largely unique to defence proj. – Engineering subcontracts fully reflect prime contract obligations – Acquisition of required IP from system subcontractors to build,

document & maintain ships – Modular construction with dimensional control methods/technologies – Welding technologies & training – Contract amendment & subcontract management – Cost & schedule control & reporting – Inventory mgm’t & tracking (Project Authority takes ownership of

most stuff when delivered on site) – Configuration management for tracking engineering change control – “Issue 4” Safety critical documentation authoring & management

must track eng. changes throughout ship lifecycles – Both human maintainers and computerized maintenance

management systems must understand safety-critical tech data/documentation

Problems identified and managed locally – Internal solutions and innovation / Locally managed R&D 19

IT & KM successes & failures

Test, evaluation & validation of operational availability (AO)

Contractual requirement to prove that ~18 different critical systems were each individually available for operations 80% of time and all of the systems together were available 90% of time

– Major test of design and adequacy of design engineering, maintenance planning & routines, maintainer training, ILS support and sparing philosophy

– Had to be proved from evidence collected from first 10 ship-years in service (Ship 1 x 4 yrs, Ship 2 x 3 years, Ship 3 x 2 yrs, Ship 4 x 1 yr)

In-house team designed and implemented OAARS system to calculate down-times from data on component failures recorded in ship-board maintenance management systems

– System had to work with Navy’s AMPS maintenance management system

– Calculation involved an availability tree hierarchy to determine impact of individual component failure on availability of critical system(s) and ship

Solution worked so well that Navy adopted AMPS and OAARS for all ships except submarines (that had another maintenance management system)

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Shipbuilding Systems Project (from ~1996)

Problem: costly nugatory work and rework in production – Management solution focused on better bean counting: implement

manufacturing resource planning system – Hired outside IT project mgmt “consultants” to work with IS

First try – 1+ yr implementing BaaN system designed for continuous manufacturing and

auto industry that did not understand Defence tracking requirements – Neither consultants nor vendor staff experienced with defence projects

– Tenix rejected first implementation

Second try – Vendor returned with version implemented for Boeing in Seattle – Consultant/vendor staff still didn’t understand new defence-related functions

– I was able to explain, but Tenix lost confidence in vendor

– Consultant/vendor told to get off the site and take their junk with them

Cost – 15-20 ~ staff full-time x 2 yrs each on both sides – time completely wasted – ~ $10-20 million completely wasted with zero economic return!

Shipyard work was efficient, the real problems were managing engineering knowledge & change before steelwork began

– Area addressed by Product Data / Project Lifecycle Management (PDM/PLM) 22

Product Data Management

In-house PDM assessment group formed to select solution – Staffed by systems, design, & support engineers

– Reviewed & ranked all viable systems, eMatrix ranked 1

Finance and admin dithered for almost a year to approve project – Last ranked system (Sherpa) presentation to management given by a

person who understood Defence contracting better than we did We already had a first generation Sherpa system & Navy used it

Sherpa spaghetti code was very slow and unmaintainable with poor in-country support

GM Engineering forced decision against c’ty recommendations despite presentation of evidence that Sherpa was failing

– IS began implementing system as Sherpa IP was being auctioned

Sherpa never did what Tenix needed

Engineering change management problem was solved with end-user designed/managed systems implemented in-house (see Issue 4 and Crossbow, below)

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Issue 4 (“documentaton quality”) – document & content management was critical for whole project

Contract assumed all documentation would be delivered on paper – Navy decided to implement computerized maintenance management (AMPS) – Tenix didn’t want the monstrous problems of keeping paper current – Negotiated a zero cost amendment to deliver data + doco into AMPS

All tech data & doco would have to parse in relational AMPS and be usable by human maintainers as maintenance instructions

– 2000+ maintenance routines per ship x 10 ships (+ onshore subsets) All key codes must parse for relational system to work

Impossible to provide by human authors using word processing systems 3 different doco systems used/tested - none could deliver flawless data + doco

– Issue 4 crisis If data & documentation deliveries for Ship 4 milestone didn’t parse correctly ship 5

would not be accepted triggering ~$30 m liquidated damages, schedule slippage & reputational damage

SGML/content management R&D project evaluated technology & systems – All credible overseas & local systems evaluated – best was RMIT’s SIM to be

implemented by Aspect Computing (product renamed TeraText). – F&A did not understand problem or technology & never signed contract – Operations manager diverted “time & materials” funds from operations – Complete success – still in use today? reduced support doco costs 70-90%

on initial budget; half the solution to engineering change management 24

Established architecture integrating Tenix’s product configuration and document content mgmt

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Product data and documents are structured and managed as content

Production data is transactional and is managed as records and fields

MRP / PRODUCTION MGMT • MBOM • Production planning • Production schedule • Procurement • Warehousing • Establish & release workorders

Project Schedule

HRM

Accounting

CS 2

Capability requirements Documentation requirements

PRODUCT MANAGEMENT ( structured designs )

MODELS: • Component definitions • Component hierarchies

- System - Physical structural - Availability

OBJECTS MANAGED • Drawings • Parts lists • Configurations • Component specifications

and attributes

DOCUMENT CONTENT ( structured documents )

MODELS: • Element definitions

- Content - Attributes

• Element hierarchies • Element sequences

OUTPUT OBJECTS • Contract/subcontract

documents • Procedures/instructions • Deliverable documents • All other controlled

documents

COMMON REQUIREMENTS • Config control / Change mgmt

- Develop/Author - Release - Applicability, Effectivity

• Workflow management - Configuration changes - Document changes - Other business objects

• Track and control source data

Link element to component

Manage elements

Omega PS LSAR Database

EBOM EBOM

Catalogue

Drawings

ENGINEERING CHANGE

See eMatrix, Windchill, TeamCenter

Contract

Implementing this architecture for the ANZAC Ships reduced time for engineering changes from months to more than a year to weeks or even a day or two if needed.

Maintenance knowledge improvement cycle in practice for ANZAC Ships

Developed OARRS in-house to test if contracted availability thresholds were met over 10 ship-years of operational experience

– Hired programmers to complete coding and implement

– Met requirement with complete success

Management decided not to patent and market

Project taken over by outside contractors working for Navy and renamed Class Systems Analysis and Reporting System (CSARS)

– Adopted by RAN for all naval ships except submarines

Provided a closed & continuous feedback loop to validate & improve maintenance routines/ documentation

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CONTRACTS

TECHNICAL

MAINTENANCE

PLANS

SUPPLIER SOURCE

DOCUMENTS

SAFETY

CORRESPONDENCE

ENGINEERING

CHANGES

AUDIT AND LOGISTICS

ANALYSIS

TECH AUTHOR

MAINT. ENGINEER

ILS DB / LSAR DB

• Line item details

• Config details

• Eng. Changes

CLASS SYSTEM ANALYSIS AND

REPORTING SOFTWARE

MAINTENANCE AUDIT FUNCTION

TERATEXT

DB

CSARS

ONBOARD

ASSET MAINTENANCE

PLANNING SYSTEM

AMPSCOMPLETION

REPORT

CLIENT

MASTER

DATA FILES

MAINTAINER COMPLETING

MAINTENANCE ACTION

ASPMIS

TRANSFER

SHIP SPECIFIC

CONFIGURED

MAINTENANCE

ROUTINES

TENIX

CLIENT

Crossbow – rationalized and consolidated key eng data replicated across 15 separate systems

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Critical information on ship/ system parts found on up to 15 different databases

– Spreadsheets, …, RDB

– Different ID systems used in different DBs

– Typos & transcription errors

In house support engineer recruited from RAAF developed data rationalization/ warehouse called Crossbow

– Matched similar/identical items across DBs & managed coms to synchronize on a single identifier for each part

– Recorded current & historical states of all DBs

– Provided point in time tracking of all changes & corrections

– Single user interface allowed easy navigation across all databases

– Client deliveries and access to Tenix data provided via Crossbow

Tenix belatedly tried and failed to commercialize product

Architectural overview for an integrated prime contractor-operator KM system ANZAC

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Tenix Land implemented fully integrated Configuration Management Information System for M113 UP

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CMIS

MRP

Production

Procurement

RAM

Relex

Opus

LSA

TeraText SGML

TECHNICAL PUBLICATIONS

CAD

ACAD

CATIA

LORA

CMIS

MRP

Production

Procurement

RAM

Relex

Opus

LSALSA

TeraText SGML

TECHNICAL PUBLICATIONS

CAD

ACAD

CATIA

LORALORA

MRP = Mfg. Resource Planning CAD = Computer Aided Design LORA = Level of Repair Analysis RAM = Reliability & Maintainability LSA = Logistic Support Analysis

System implemented to manage all project related documentation through entire product lifecycle Executives never understood what CMIS could do, and middle managers who did all left Tenix in frustration Travel not authorized for effective liaison between Land & Marine

Background

Contract: All configuration management in M113 Project according to – TRAMM (Technical Regulation Army Maint Mgmt) – MIL-STD-973 (Configuration management)

Other standards – Naming follows H6 (US Fed Item Name Directory) – NATO Commodity Codes forms part type – Final development based on S1000D XML standard

for documentation Rule: CMIS manages all tech data for all projects

– Engineering data – Source documents – Technical Publication content

No part released until all metadata correct

CMIS was conceived as an "umbrella" system

Integration of MatrixOne and TeraText

Single user interface via MatrixOne

Data normalization applies to all project data and document components from the start

MatrixOne provided common workflow management environment for entire project

Single point: – electronic signoff (no paper chases!)

– engineering change management and tracking at light speed

– cost and schedule control prior to signoff

The umbrella covers everything!

CMIS recognized that engineering knowledge was Tenix’s most important asset

Data and documentation are the most important assets to the company

CMIS is the custodian AND guardian of the Company’s data and documents

– Secure Vaults and Stores

– Encrypted

– Access control

CM II compliant – Only recognized commercial CM doctrine

– Qualified by Institute of CM

– CM Manager was only CM II qualified certifier in Australia

Understood how everything went together to deliver the capabilities the client wanted

Single check-in/check-out/workflow interface via MatrixOne to all other applications

CMIS

MRP

CAD

RAM

Tech Pubs ACAD

CATIA

TeraText

SGML

Relex

Opus

Production

Procurement

2001 – 2007

—

ANZAC closeout & Project Protector failure

Serial production & closeout of ANZACs

Specialist “close-out” GM blocked transfer of living knowledge by isolating ASP serial production from other activities

– Staff required to account for every half hour against cost code in work breakdown structure

– ASP behind security fence with swipe card access only – Non ASP staff required GM signature to visit ASP staff – Chatting around water cooler & coffee breaks seen as time wasting

Costly engineers/senior staff outsourced or given redundancy ASP IS decided to replace the working Crossbow “kludge”

– Navy selected TeamCenter as their PDM system for ships in service Land’s MatrixOne solution was offered Suspect selection – key Navy selectors became TeamCenter employees

– ASP chose TeamCenter because Navy was going to use it rather than Matrixone CMIS system that was fully operational in Adelaide

– ASP and IS spent millions trying to implement TeamCenter as shipbuilder system for ANZAC Ships Could not manage complexity of ASP Still wasn’t fully working when Tenix Defence taken over by BAe Systems 35

Mobilizing Project Protector to build 7 new ships for New Zealand

Anticipating Protector, I established an R&D project in Head Office to develop & prototype strategy to map and facilitate transfer of lessons learned from ASP to Protector

– IS spec. projects analyst, sr C&S controller, KM intern, programmer

– Identified major areas of project risk

– Knowledge map used to guide interviews

– Narratives, nuggets, metadata gathered in Crossbow to facilitate navigation & exploration for possible solutions

– Proposed to introduce people experienced in risk areas in Q&A sessions

New engineering staff hired “off the street” at low salaries – Engineering graduates or industrial qualifications

– Few had defence, mobilization, shipbuilding, or CM experience

Knowledge transfer activities blocked three times by line managers – Too busy

– Time wasted against “critical activities” in work breakdown items

Chose not to implement working CMIS system from Land in Adelaide – IS chose to implement cheap & simple Croatian shipyard management system

– 3+ months into project still didn’t know how to set up configuration IDs

– Would not pay air fare for CM expert in Adelaide to help 36

Why did Tenix fail?

Executives never seemed to understand organizational imperatives for their own company

What are “organizational imperatives”? (my usage differs) Things the organization must do successfully in order to continue its existence and flourish in its real world physical, environmental, and economic circumstances.

– Imperatives depend on the nature of the organization and its environment

– Imperatives exist independently of management beliefs, strategies, goals and mission statements – physics always trumps belief

– Organizations failing to satisfy their imperatives in one way or another will not thrive and may fail

Imperatives for an engineering project manager (e.g., Tenix) – Qualify and win suitable contracts (find customers)

– Successfully complete contracts won (satisfy customers)

– Ensure overall operational profitability

– Maintain workforce able to address imperatives

– Comply with health, safety and environmental standards

– Comply with governmental regulations

– Satisfy all of the above imperatives

Don’t divert effort/resources to activities that don’t address imperatives 38

Never learned how to reliably win contracts

Never understood the power/dangers of electronic documents – Put MS Word in hands of contract engineers and typists who used

wordprocessor like a typewriter – Multiple authors worked on same electronic files

Internal R&D project proposed to replace MS Word authoring environment with authoring & configuration management environment used in-house for ANZAC documentation

– Would have reduced bid cost/hours by more than 50% allowing resources to be applied to more/better crafted bids

– Support engineering (but not IS) had expertise to implement it – Payoff time a year or less or immediately an “extra” bid is won

Executives / F&A did not believe or understand concepts Only 3 bids won (including Protector) in 17 years after ANZAC Should have won Air Warfare Destroyer bid

– Tenix lost to ASC on a “value for money” basis – Scuttlebutt said that F&A had costed work not required in RFT

Tenix unable to successfully complete $500 M Protector – Won $ 2 BN LHD project as company was being auctioned

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50+ ENGINEERS & ANALYSTS ENTERING OWN WORK

APPROXIMATELY 600+ INDIVIDUAL WORD PROCESSED DOCUMENTS INCLUDED IN TENDER

EACH INDIVIDUAL ELECTRONIC DOCUMENT FILE WILL BE WORKED ON BY MANY AUTHORS

ENGINEERS & ANALYSTS CREATE AND TYPE, LOCATE AND AMALGAMATE DATA & OBJECTS

PRINT? - REVIEW & EDIT / RETURN FOR CHANGE, PRINT? - REVIEW & EDIT AGAIN

1000’S OF SOURCE DATA ITEMS - MAY BE WP DOCUMENTS PRODUCED IN-HOUSE,

PREVIOUS TENDERS, DDS DOCS, SUPPLIER SOURCE DATA IN UNKNOWN FORMAT,

STANDARDS, GRAPHICS, SPREADSHEETS, DRAWINGS, CLIENT DOCUMENTS, ETC

COORDINATOR AND DOCO PRODUCTION TEAM PRINT 600+ FILES & ASSEMBLE REVIEW VOLUMES

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COORDINATOR & DOCO PRODUCTION TEAM VALIDATE 900+ ELECTRONIC FILES AGAINST DID CONTENTS

DOCO PRODUCTION

TEAM PRINT MASTER

COPY FROM CD

DIRECTORY

DATA CONTROL PRINTS COPIES

DOCO PRODUCTION

TEAM TRANSFER

VALIDATED

SUBDIRECTORIES TO

CD DIRECTORY -

BURN CD ROM

SENIOR MANAGERS REVIEW & EDIT CONTENT / STYLE ETC.

To win a bid you have to draft it

• Tenix’s bid authoring and doco management systems didn’t work

– Time tightly limited – Paper procedures applied

to electronic documents – 50% of bid engineers’

work lost/nugatory – Could not standardise doco – No traceability/tracking – Revision control not

enforced – Final stage crises – Chaos

• Resulting bids – Costly in time & personnel

resources – Poor costing of work bid – Sloppy presentation – Late – Incomplete – Full of errors

DOCO PRODUCTION TEAM ASSEMBLES 900+ FILES INTO SUB-DIRECTORIES

TECHNICAL SUPERVISORS AND MANAGERS REVIEW & EDIT TECH CONTENT

TEXT EDITOR PROOFS FOR READABILITY AND ENGLISH USAGE

Problems inherent(?) in the family business led to its demise in the third generation

All major ANZAC problems solved by 2001 acceptance of Ship 5 – In 2001 strict command and control hierarchy was instituted under

closeout GM to squeeze last cent out of “serial production”

– Most engineers “outsourced” to labor hire companies, hived off to other divisions, or made redundant asap.

Construction industry bean counting mentality – Used to hiring/contracting standardized management & trade skills

on a project by project basis

– Management bonuses based on retrospective “Tenix Added Value”

What they did in the past, not what they were doing for the future

– Little thought or understanding of the value of unique personal knowledge, org. continuity & meeting organizational imperatives

– Staff not allowed to do anything not booked directly to a contractual work item code

– Every half hour had to be accounted in time management system

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The dead hand of absentee owners and Finance and Administration mentality killed the company

Owners & senior execs worked from Tenix Tower in Sydney – Isolated from all operating divisions (closest was Pukapunyal) – Minimal provision for interstate travel between divisions & HO

Centralized command & control hierarchy – North Sydney was a “black hole”: information in – nothing out – Long chain of command with poor formal delegation of decisions – Prior to 2001 many important decisions towards successful solutions

were made locally in default of / or even despite central authority.

Execs did not understand how to manage or value knowledge – Ignored findings of contracted KM audit, several consultants & CIO – Did not understand value of tacit or explicit knowledge

Finance & Administration mentality – Knew cost of everything, value of nothing – Sr mgmt bonuses based on retrospective “Tenix Added Value” – Information Systems a department under F&A

IS had little understanding/consideration of end-user requirements F&A would pay millions for hardware & software but little for

analysis & training 42

Why does Defence think Australians

can’t/shouldn’t build warships & submarines?

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Open for discussion