KPMG Full Page Talkbook Template

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The Maritime Industrial Strategy- issues,
improvement needs, and actionsNeil McCabe MIS
Team Leader 23 Nov 2006
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The key issues facing the UK maritime sector
- We are taking too long to deliver programmes
Time from initiation to ISD, years
SSN Refuelling refit time required, months
Time to get to main gate then produce an AD ship
post NFR90, months
France
U.K.
U.S.
Astute
Trident
Polaris
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The key issues facing the UK maritime sector
(cont)
- We are getting fewer platforms for our money,
and fixed costs are consuming a larger
proportion of overall cost
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The key issues facing the UK maritime sector
(cont)

• Workload
• The industry, particularly in surface ship build
  and support, needs to downsize
• In support, the sun is not shining, and the roof
  is already leaking!

• Now
• 3 surface ship build yards
• 1 submarine build yard
• 3 Naval Bases
• 3 Upkeep facilities
• 1 submarine refit disposal facility

• 5 years
• 4 surface ship build yards
• 1 submarine build yard
• 2 Naval Bases
• 1 or 2 Upkeep facilities
• 1 submarine refit disposal facility

• 10 years
• 1 surface ship build yard
• 1 submarine build yard
• 2 Naval Bases
• 1 Upkeep facility
• 1 submarine disposal facility

• Until Future Surface Combatant starts, our
  ability to sustain complex surface warship
  concept and systems design will continue to erode

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We must improve, or watch Maritime Capability
erode

• MOD and Industry need to improve
• MOD - the Enabling Acquisition Change Programme
  is covering a number of strands to improve
  performance internally. In the maritime sector,
  its success will be measured by
• Time - MOD must get through to Main Gate faster
• Risk - We cannot contract for Complex Warships
  via output specifications.
• If we are to aim high, MOD must bear, and be able
  to manage, large elements of performance risk.
• Performance - the best, too late, too few in
  number, is not a success
• Continuity Sustainment - programming
  instability is a major cost and time thief
• we must move towards stable design construction
  drumbeats
• we must be prepared to sustain key industrial
  capabilities
• Industry - Will need to consolidate and downsize
• consolidation must deliver benefits of
  affordability
• sustained capabilities must have embedded
  performance improvement
• business models based on maximising output from
  fixed customer budget
• Both - need to come to terms with long term
  partnering behaviours
• nurturing, and regulating monopoly/monopsony
  relationships
• based on through-life approaches

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Actions

• Identifying a Core workload - Skills analysis
  underway
• Skills work looking beyond waterfront and drawing
  from NEST
• Core Surface Ship design and build workload based
  on FSC
• Need to generate programme which sustains design
  - studies and batching
• Specific work on sustaining Rosyth to CVF
  assembly
• Establishing benchmarks for development of
  sustained facilities
• Benchmarked productivity for design production
• Facilities specification
• Identifying levers and incentives for
  transformation in industrial landscape
• Cross-government (MOD, DTI, HM Treasury, No. 10)
  agreement
• Co-ordination of change initiatives to achieve
  best effect, e.g. SSSA and NBR
• Identifying key events to trigger transformation
  - CVF, Naval Base Review
• Working with Industry to define agreements on
  future sustained facilities