Major
General Mrinal Suman, AVSM, VSM, PhD
While
delivering the keynote address at the International Seminar on Defence
Acquisitions on 12 July 2011, Defence Minister A K Antony accepted the need to
impart training to the defence acquisition functionaries. Further, he agreed
that a dedicated institute needs to be set up for the purpose. It is the first
time that the training of acquisition staff has received the attention that it
deserves as reforms in India’s defence acquisition regime have so far been
limited to procedures only. Overlooking the fact that any mechanism is as good
as the people who operate it, professional competence of the personnel
implementing the procedures was given little importance. Lack of a core of well
qualified and adequately trained acquisition staff became the weakest link of
the acquisition chain and this deficiency was first highlighted in an article
that appeared in 2005 in Indian Defence Review.
Subsequently,
even the Comptroller and Auditor General (CAG) noted the fact that system of
acquisitions being handled by unspecialised personnel posted for three-year
tenures was simply not adequate. It emphasised that ‘defence acquisition is a
cross-disciplinary activity requiring expertise in technology, military,
finance, quality assurance, market research, contract management, project
management, administration and policy making’. However, this aspect continues
to remain totally neglected to date. It has generally been accepted the world
over that an efficient acquisition work force can not only expedite
procurements but also affect a saving of up to 15 percent of the capital
expenditure in initial purchase price and associated life-cycle costs. Therefore,
the Defence Minister’s recognition of the need to impart required skills to
defence functionaries is a long awaited and a welcome development.
A
Look at Select Nations
All
developed countries recognise the fact that acquisition of defence equipment is
a highly specialised and complex activity needing extraordinary professional
skills and unique attributes. They not only select personnel for acquisition
functions after due diligence but equip them with necessary skills through
regular training in various disciplines. Three leading nations are discussed
hereunder.
The
United States of America
As
per the provisions of the Defence Acquisition Workforce Improvement Act (DAWIA),
all members of the Defence Acquisition Workforce have to be certified for the
position they hold. A Defence Acquisition University (DAU) has been established
for conducting training courses in 13 career disciplines with three
certification levels (entry, intermediate and senior). The mission of DAU is to
‘provide a global learning
environment to support a mission-ready Defence Acquisition Workforce that
develops, delivers and sustains effective and affordable war-fighting
capabilities’. DAU
is a corporate university responsible for the training and career development
of more than 126,000 acquisition employees.
The breadth of DAU’s curriculum can be gauged from
the multiplicity and variety of the fields its training programmes cover. They
include information resource management; acquisition management; logistics;
auditing; programme management; business, cost estimating and financial
management; production, quality and manufacturing; contracting; requirements
management; software acquisition management; facilities engineering; science
and technology management; systems planning, research, development and
engineering; and test and evaluation.
The United Kingdom
The
importance of imparting required skills to the acquisition workforce has been
repeatedly stressed by all review committees and commissions. As per the Gray
Report, significantly greater skills are required in programme and project management;
finance; cost estimating; engineering and contracting; and management information
systems at all levels of the British acquisition organisation.
According
to the Defence Acquisition High Level Blueprint, the success of the acquisition
system depends on the skills and professionalism of people within the
acquisition community. Similarly,
Defence Acquisition Reform Programme (DARP) also suggested raising skill levels
across the complete acquisition regime.
Defence
Acquisition Change Programme also stressed the need to concentrate on
developing key skills necessary to deliver defence acquisition business, especially
in cost- time estimation and project management. Written Ministerial Statement
of Defence Secretary Bob Ainsworth of 15 October 2009 on Independent Review
Defence Acquisition also vowed to accelerate the improvement of the above
mentioned key skills of cost forecasting and programme management.
Consequently,
the Defence Acquisition Management Education Programme is providing
comprehensive training and development opportunities across all disciplines. Skills-planning
is in place across the whole acquisition community for all major disciplines. There
is also a fellowship scheme to recognise and retain world class specialists
with scarce skills. Joint training is carried out with industry to help share
and develop best practices. The Defence
Academy in Shrivenham is the nodal centre for imparting acquisition training to
the acquisition workforce and members of industry.
France
Recognising
the importance of technical skills, France is highly exacting in the selection
of its defence acquisition staff. It recruits mainly engineers and technical
officials. Candidates must hold a degree in engineering, a master’s degree in science/economics
or a degree from a business school of repute. In addition, Direction générale de l’armement (DGA), the
overarching authority, engages on contract engineers and technical
managers with high level of expertise. Initially the contract is for a fixed
term of three years. It can be renewed once and the employee can be made
permanent thereafter, if found suitable.
DGA
is of the view that the acquisition taskforce must have technical orientation
as defence equipment incorporates cutting-edge technologies
It is often said that the French acquisition functionaries are as technologically
accomplished as the producers of military equipment. The importance that France
assigns to the training of the acquisition personnel is apparent from the fact
that DGA has a number of engineering schools under its direct control – École
Polytechnique; Ecole Nationale Superieure de Techniques Avancees
(ENSTA), Institut Supérieur de l'Aéronautique et de l'Espace (SUPAERO), École Nationale Supérieure de Techniques Avancées de Bretagne (ENSTA
Bretagne) and Institut Supérieur de l'Aéronautique et de l'Espace (ENSICA).
DGA’s armament engineers are graduates from École polytechnique. Subsequent
training is imparted at ENSTA Bretagne or SUPAERO.
Need
for a Skilled Acquisition Workforce for India
As seen above, acquisition of defence equipment is a
highly specialised and complex activity needing extraordinary professional
skills and technical competence. India needs to take the following three steps
to upgrade India’s acquisition workforce:-
·
All critical appointments in the acquisition
process (manned by civil and military personnel) should be identified and duly
notified as Acquisition Staff Appointments (ASA) – to include the Ministry of
Defence (MoD), Headquarters Integrated Defence Staff (HQ IDS) and the Service
Headquarters (SHQ). As every appointment requires unique attributes and
professional skills, essential qualifications should be evolved for each
appointment – some appointments may need specific engineering or financial
expertise.
·
Only personnel meeting the laid down
criteria should be posted to ASA after due selection and not as a part of
routine turn-over. Due cognizance should be taken of their educational
qualification, experience, demonstrated competence, displayed flair and
unimpeachable integrity. Once posted, their tenure should be extendable to 4-5
years, with appropriate protection of their career interests.
·
All ASA appointees should be imparted general
orientation guidance on joining, acquainting them with the procurement
structures, defence procurement procedures and the functioning of the system.
Subsequently, they should be imparted appointment-specific training to equip
them to discharge their duties efficiently. There is thus a need for a dedicated
institute for training the defence acquisition workforce.
Proposed
Institute
It
is proposed that a National Defence Acquisition Institute (NDAI) be established
under MoD. To start with, it could be an adjunct to the Institute for Defence
Studies and Analysis (IDSA) at New Delhi or the College of Defence Management
(CDM) at Secunderabad. It can utilise their existing infrastructure and
facilities till its own campus comes up. Co-locating it with IDSA has the
advantage of being in the national capital. On the other hand, CDM will provide
the benefit of a highly qualified faculty that can be made use of in the
interim.
The
charter of NDAI should include the following:-
a) Conduct
of activity-focused and appointment-oriented courses.
b) Emerge
as a centre of excellence, provide necessary impetus to domain knowledge and be
a repository of field experience gained.
c) Act
as a think tank for emerging issues; carry out case studies to identify
positives and negatives of the system; and provide advice to MoD, HQ IDS and
SHQ on policy related reforms/issues, whenever asked for.
d) Create
a data bank of institutional memory.
The Institute should have the knowledge and wherewithal
to cover the following disciplines as they pertain to defence acquisitions:-
·
Mission Definition, Execution Strategy,
Systems Planning and Support Planning.
·
Determination of Performance Goals and
Performance Assessment.
·
Business Modelling – Basic Probability Concepts,
Subjective Probability Assessment and Basic Simulation Concepts)
·
Cost Risk Analysis – to include Risk
Quantification, Evaluation and Reduction Process.
·
Sensitivity Analysis and Risk Management.
·
Proposal Adequacy Verification Systems and
Configuration Management.
·
Fixation of Major Milestones with delegated
authority.
·
Fundamentals of Test and Evaluation
including Computer Simulations and Modelling.
·
Business Modelling and Facilities
Engineering.
·
Applied Cost Analysis to include cost of
development, materials and technology.
·
Earned Value Management System.
·
Programme Management – Concept,
Methodology and Skills.
·
Management of Developmental Projects –
Production, Manufacturing, Quality Control and Oversight.
·
Operating and Support Cost Analysis.
·
Estimating Techniques – Parametric, Analogies
and Improvement Curves.
·
Defence Acquisition Financial
Management.
·
Business Negotiating Techniques and
Contract Drafting.
·
Legal Aspects of Defence Contracts – to
include liabilities of both sides, exit options and arbitration laws.
·
System Sustainment to include
Management, Reliability, Availability and Maintainability.
·
Performance Based Logistics, Life Cycle
Product Support and Enterprise Life Cycle Logistics Management.
·
Internal Financial Controls and Auditing
Norms.
·
Probity, Ethics and Redressal Mechanism.
Additional disciplines can be added for study and the
curriculum further refined with the emergence of newer challenges.
Structuring
of the proposed NDAI can be carried out in two ways. One, faculties can be
organised on the basis of the above mentioned disciplines, thereby facilitating
development of in-depth knowledge of the subjects, albeit at academic level.
The second option is to organise faculties on the basis of acquisition activities.
It is considered a better option. As the complete gamut of acquisition
functions are performed by different functionaries in sequential activities,
training courses can be structured for them accordingly. Such an arrangement
will provide focused domain knowledge to the acquisition staff and enable them
to discharge their functions more professionally.
It is recommended that NDAI should have six faculties
as follows:-
a) Faculty of Capability Management. It
should cover the following aspects:-
Ø Based
on the Defence Planning Guidelines, evolution of 15-Years Defence Capability Plan.
Ø Identification
of capability gaps duly prioritised.
Ø Preparation
of 15-Years Long Term Integrated
Perspective Plan and 5-Years
Services Capital Acquisition Plan.
Ø Translation
of needed capability into parameters and management of requirements.
Ø Categorisation
of proposals to decide the route to be adopted.
Ø Formulation
of Services Qualitative Requirements (SQR).
Ø Drafting
of Request for Proposals (RFP).
b) Faculty
of Technical Evaluation. Its syllabus should include the
following:-
Ø Evolution
of Test and Evaluation (T&E) philosophy.
Ø Preparation
of T&E plan and methodology, to include computer simulations and modelling.
Ø Finalisation
of trial activities, modalities and sequence.
Ø Drafting
of Trial Directive.
Ø Selection
of trial locations and equipping of trial units.
Ø Evaluation
of technical proposals.
Ø Preparation
of trial reports.
Ø Finalisation
of staff report.
c) Faculty
of Project Management. As this Faculty would generally be dealing
with developmental projects under ‘Make’ and ‘Buy and Make (Indian)’
categorisations, it should preferably be headed by a DRDO scientist and cover the
following subjects:-
Ø Preparation
of Project Feasibility Studies for ‘Make’ cases.
Ø Evolution
of Project Definition Document, defining system requirements in detail.
Ø Study
and analysis of Detailed Project Reports of the industry, especially with
respect to transfer and absorption of foreign technology.
Ø For
‘Buy and Make (Indian)’, preparation of Capability Definition Document (CDD)
outlining requirement in operational terms, long term quantities, time
schedule, immediate fund availability
and critical technologies to be absorbed.
Ø Appraisal
of roadmap for development/production and firming up of technical requirements.
Ø Constitution
and functioning of Integrated Project Management Teams.
d) Faculty
of Commercial Evaluation. It should preferably be headed by an
officer from the Defence Finance Department. Its syllabus should cover the
complete gamut of commercial evaluation activities to include the following:-
Ø Constitution
of a well-qualified and professionally competent Commercial Negotiation
Committee.
Ø Determination
of fair and reasonable price.
Ø Preparation
of Compliance Statement as regards the terms
offered in RFP, including advances, stage payments, delivery schedule,
performance warranty, guarantee terms and acceptance criteria.
Ø Preparation of ‘Comparative Statement of Tenders’ to
evaluate technically acceptable offers and determine lowest acceptable bidder.
Ø Application of Discounted Cash Flow method and Life
Cycle Cost concept to identify the most cost-effective choice.
Ø Price negotiation methodology and techniques.
e) Faculty
of Contract Management and Logistics. It should be headed by
an officer qualified in contract/corporate laws with intimate knowledge of
arbitration proceedings, Life Cycle Logistics, Performance
Based Logistics, Life Cycle Product Support and Enterprise Life Cycle Logistics
Management.
f) Faculty
of Offsets Management. As offsets have become an integral part
of the Indian procurement system, their importance and complexities are bound
to increase. All aspects related to evaluation of offset proposals and
implementation of offset programmes should be covered. Oversight, monitoring
and measurement of offset credits need special emphasis.
Conclusion
Needless to say, value of the proposed Institute
will depend entirely on the quality of the faculty members. They should be
selected purely on merit, without any parochial service consideration.
It is not necessary to confine the search to retired civil and military
officers. The net must be cast wide to recruit best brains available in the
country – even from academia and industry. Their tenure should be long enough
for the consolidation of gains made through initial gestation and subsequent growth.
A word of caution will be in order here. Unfortunately,
many senior functionaries (both military and civil) do not feel any necessity
to improve their knowledge or hone their skills in the mistaken belief that
their basic intellect, initial training and subsequent experience equip them to
shoulder any responsibility. They are going to resist training at the proposed
Institute. MoD will have to make it compulsory.
Finally,
reforms in defence acquisition structures and procedures do make a difference,
albeit to a limited extent. No reforms can yield results unless acquisition
functionaries are trained and equipped to translate progressive policies into
tangible actions on ground. It is absolutely imperative that India equips and
trains its defence acquisition workforce suitably. It is only then that the
stated aim of providing effective,
affordable and timely weapon systems to the armed forces can be achieved.
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