Creating an innovation culture

Thanks once again to ADM and its Editor, Katherine Ziesing, for giving me the space for another short column in ADM's September edition on defence innovation - this time looking at the innovation culture. I'd like to shout out to Defence's Chief Information Oficer Group (CIOG), whose Directorate of Innovation has done some deep thinking on this and come up with a definition of an Innovation Culture that would serve many different types of organisation. Thanks also to CIOG for the OK to share their insights.

Supporting an innovation culture

INTRO: Hey, you’re going to ‘Innovate’, and grow an ‘Innovation Culture’. Great! But what does that actually mean?

Gregor FergusonSydney

There’s not a Defence-wide definition of an ‘innovation culture’, any more than there is an industry-wide one. Don’t say I told you, but the Director Innovation in CIOG has developed a really good definition that I think is worth sharing. It lists the four Key Innovation Values of Collaboration; Learning - fostering a culture of learning over just knowing, or not;Passion - believing in what you’re doing; and Impact - what effect, what changes, will result from implementing an innovation? (If they’re not worth the effort, then the ‘innovation’ may not be very innovative.) 

Importantly, it acknowledges the imperfection of reality and the value of timing: innovation requires us to be timely, not perfect, in our solutions. Any soldier, or salesman, would agree.

How does the culture manifest itself in an organisation? Again, CIOG has thought about this. It acknowledges the risk and uncertainty that are part of the innovation process, and the need to manage failure – both actual and incipient – and learn from it; it acknowledges the vital role of a committed leader, and of champions in both the innovating organisations and their customers. 

There’s a circular argument here: does introducing an innovation culture change an organisation, or do you need to change an organisation in order for an innovation culture to flourish? A bit of both, in my view. The key is a leadership that’s invested in the innovation process and the outcomes it can deliver. In practical terms, CIOG reckons an innovation culture enables or provides:

·     Access to Safe Spaces: both virtual and physical, to take calculated risks and explore

·     Time Autonomy: Time allocated for innovation and experimentation without being micromanaged

·     Recognition: Leaders recognising the contribution of innovators 

·     Collaboration: Working outside silos for effective innovation.

·     Multidisciplinary: Diversity of thought and experience for individuals and teams 

·     Playful Discovery: fostering creativity through gamified processes or tactile exploration.

·     Champions: Role models for innovation, including organisation leaders, who are invested in furthering the innovation agenda.

·     Future Thinking: Ensuring that the future is a key consideration in the present-day problem-solving process. 

This is a good cultural blueprint for any organisation looking to enhance its business processes, efficiency and competitiveness. Helpfully, some Australian universities have explored this cultural space in depth – industry can learn from them, if it chooses. 

The literature on innovation throws up some persistent lessons: supportive leadership is one; being a subject matter expert on what you’re doing is another; and customer knowledge is a third.

Leadership is absolutely vital: it’s leaders who (should) set the tone of the organisation and the expectations of its customers and staff; who (should) introduce an innovation culture into an organisation and sustain it; and who (should) arrange things so that innovators can help the organisation (a manufacturing company, an air force, a law firm, or a pizza shop) to flourish. If they decide to innovate, good leaders can bring the organisation with them; if they don’t choose to innovate or, worse, choose notto innovate, the organisation is likely to stagnate. 

But it’s important to look outside the organisation. Customer knowledge is the product of customer engagement. For companies producing goods or services in a highly competitive market, the more they understand their customers and end users, the better. 

Defence is working the engagement issue as a customer, but is understandably reticent about revealing apparent weaknesses and pain points, even to trusted industry players. But Defence’s innovation processes do acknowledge that engagement is important, not least because Defence leaders don’t always know what they don’t know and nor do industry and academic leaders, so they all need to be open to each other’s insights.

For many SMEs the customer might be Defence, and the end-user a member of the ADF, but the customer’s more likely to be a bigger company higher up the supply chain. Regardless, a smart supplier invests in understanding its customers; and smart, innovative customers take the trouble to understand the market they’re in and how a smart, innovative supplier can help them. They encourage and welcome useful engagement.

That means transparency and trust, two things that Australia’s business culture hasn’t always encouraged; for some reason, Australian industry and academia haven’t always embraced collaboration, and the Defence acquisition system’s need for probity doesn’t help because it deliberately maintains an arm’s length relationship with industry. All players need to learn how to trust. Remember the ‘collaboration’ bit earlier? You don’t collaborate without trust, and you don’t innovate if you can’t collaborate. That’s the cultural reality.

Making yourself ready to innovate

Australian Defence Magazine published the second of my innovation columns in August. Its title was 'How prepared are you to innovate?' and it's about the structure that an organisation needs if it is to be innovative and responsive to what's happening around it. It's reproduced below, with a couple of minor additions.

Thanks to ADM Editor Katherine Ziesing once again for the opportunity.

How prepared are you to innovate?

INTRO: Facilitators ready? Bean bags primed? Whiteboards clean, bright and slightly oiled? Stop! As you were! 

Gregor FergusonSydney

‘Innovation’ is almost a buzz-word: it’s one of those things that’s hard to define, to the point that trying to create a single definition to cover all circumstances is simply pointless. 

Understanding that Innovation is about change is important. Creating an Innovation Culture is important. Engaged leadership is really important. But how do you configure an organisation to exploit that innovation culture and leadership? 

The organisation that you run or work for is (or should be) configured for the business you’re in. You might be manufacturing a product (guided missiles, or sugary cakes), or delivering a service (as an MSP contractor, or delivering flowers, or running a government department), or running an air force. 

The business you’re in will determine your structure and size, but to be innovative you need also to honour the principles of leadership, subject matter expertise and customer awareness as well as the willingness to pursue and embrace change.

Whatever your business, the same four fundamentals apply: Self-Awareness; Situational Awareness; Professional Mastery; and Business Mastery (or Leadership).

Self Awareness is about the innovator’s ‘internals’ – what he’s capable of, and what he needs to change if he wants to do more, or do something quite different. It’s an internal quality control system and it’s vital.

Situational Awareness is all about the ‘externals’: what is happening externally that may force a change, or that might present an opportunity? What is happening with technology, or the economy, or market conditions, or customer behaviour? 

The two feed each other. The innovator’s Situational Awareness determines his ability to expose and identify threats and opportunities; the innovator’s Self Awareness will shape his ability to respond. 

The actual response to those opportunities and threats will be conditioned, and possibly determined, by the innovator’s Professional Mastery.  

No person or organisation exists in a vacuum: whether we’re talking about a charity, a government department, an elite sportsman, a star entertainer or a manufacturing company, the innovator’s activities almost always centre around a specialist domain in which he is (or should be) the subject matter expert – this is Professional Mastery. 

For the ADF it is the ability to generate and apply military power at the behest of the elected government (its ‘customer’): every aspect of training men and women and operating equipment to the highest levels of proficiency. For the manufacturer, it is the technology embodied in his products and services that make them saleable, and the manufacturing techniques and enabling technologies that allow the players in this market to survive and flourish. 

The relevance of your Professional Mastery, and the professional and technical standards you need to achieve, are informed by your Situational Awareness and Self Awareness. The organisation’s leaders and the internal culture they help create will determine how welcome and valued each attribute is within the organisation. Good managers will also create the internal processes and mechanisms and nurture the skills and specialist expertise necessary to exploit the insights they gather. 

This is the bedrock of enterprise-level innovation and it’s what Business Mastery is all about: the ability to maintain an organisation’s openness to change, on the one hand, while managing its everyday activities as efficiently and economically as possible, while also developing timely responses to threats and opportunities. This embraces business management, administration, human resources and strategic planning. And innovation. This applies to the lone innovator as much as it does to a large, complex organisation.

The mutual dependence of Self Awareness, Situational Awareness, Professional Mastery and Business Mastery can be shown in a simple diagram:

Their relative importance will wax and wane as an organisation passes through the business cycle. All are essential, but Business Mastery will help determine where the balance needs to be struck at any one time.

Don’t laugh, but the ADF gets this and Defence as a whole is slowly catching up. What government organisations struggle with, however, is an innovation culture at odds with a conservative, hierarchical tradition of top-down management and caution over policy development and the expenditure of public funds. Industry and academia enjoy a freedom that public organisations don’t, so have fewer impediments to embracing innovation – if their leadership and culture allow.

Defence Innovation - catching on

I've been writing a series of columns for Australian Defence Magazine on innovation in the defence community - not sector, but community - that word's important because successful innovation doesn't happen in isolation: it needs effective engagement between the innovator and the end-user, so industry needs Defence if it is to innovate successfully while Defence needs to understand what it needs to do and how industry and research sector innovators can help it achieve that. This is a community wide challenge.

 The ADM columns can be found here: https://www.australiandefence.com.au

Meanwhile, here's the first of those columns, published back in July - my thanks to ADM's Editor,  Katherine Ziesing, for allowing me the space and freedom to write this.

Defence innovation catching on 

INTRO: Defence is serious about innovation. Industry needs to share the journey, and help where necessary.

Gregor FergusonSydney

The 2016 Defence White Paper and Defence Industry Policy Statement broke new ground in Australia by enshrining industry as a Fundamental Input to Capability, and by committing to an ongoing investment in defence industry innovation and development. 

The DIPS quotes the then-Chief of Army, now CDF, General Angus Campbell: “Our operations in Afghanistan, and elsewhere over recent years, remind us that if we don’t innovate we won’t sustain an advantage over a future adversary – war can be very Darwinian.” 

The DWP is blunt: “The Government’s approach to Australian defence industry and innovation policy aims to maximise the defence capability necessary to achieve the Government’s defence strategy supported by an internationally competitive and innovative Australian industrial base. The focus will be on the small to medium enterprises that are the incubators for advanced defence capability in Australia.” 

There’s logic behind Defence’s embrace of industry policy and innovation: the high-technology defence sector delivers a very high pay-off for both Defence and industry innovators.

So what is innovation? There’s no Defence-endorsed official definition as yet. The Aerospace Maritime Defence and Security Foundation of Australia, organiser of the Pacific 2019 Innovation Awards, says ‘An innovation can be defined very broadly as a new idea that gets adopted and used; it’s an all-new product or service that solves an identified problem or saves somebody a lot of money, or that creates an opportunity for the user to do something important that he couldn’t before.’

Different parts of Defence are running with this broad definition. The three services, DST and the Chief Information Officer’s Group, CIOG, are heavily focussed on technology capability innovation and so this definition shapes their interface with industry. The rest of the organisation, however, also has a mandate to be more efficient, an innovation push encouraged by Defence’s First Principles Reform program. 

But there’s a definite limit to what innovators can change and achieve in any of the public agencies and departments. Public service regulations and guidelines on spending taxpayers’ money are rightly determined by probity and caution. This is famously antithetical to successful innovation, which is all about embracing risk and exploring uncertainties while pursuing a better outcome, faster. 

One answer to this contradiction lies in programs such as the RAAF’s Plan Jericho. This ‘seeds’ promising technologies and projects and so de-risks them significantly while helping the RAAF plan its own future direction before serious money gets spent on acquiring new equipment. Recent ‘smart buyer’ changes within Defence mean this approach might deliver a better outcome faster and without sacrificing probity – look at Project Land 19 Ph.7B. 

Defence’s stated policy goal is to develop “an internationally competitive and innovative Australian industrial base”. Its challenge is to foster innovation by the SMEs, in particular, and then determine a mechanism for ensuring the results are incorporated efficiently into capital equipment acquisition, upgrade and sustainment programs. The Defence Innovation Hub and Next Generation Technologies Fund (NGTF) are paths on that journey.

Industry R&D and innovation is essential to develop new products and services; industry also needs to refresh business skills and processes regularly to become more efficient and competitive, domestically and in export markets. Situational awareness is vital: industry needs to understand in some detail what Defence users need, as well as its own strengths and weaknesses in the market - Defence must be part of this process. Many SMEs already do this instinctively, calling it creativity, lateral thinking or continuous improvement and not realizing (or caring) that this is part of the innovation process.

Australia’s defence industry is abnormally polarised between a small number of foreign-owned prime contractors and a large number of indigenous SMEs. A policy focus on the SMEs’ capacity for agility and innovation is understandable. But big, hairy, ambitious projects need lots of money and people. Designing new combat aircraft, warships and submarines requires massive R&D investment by prime contractors and government research agencies. 

That’s why SMEs are lower-tier players: their contributions are vital, but they are necessarily in niche technology areas. This means their customers are often other companies higher up the supply chain. Innovation for the SMEs is as much about developing their technology and product base as it is about making them more competitive and sustainable as businesses. 

Defence and government have a key role here. There’s a collective win-win if Australia gets this right. ADM will explore this theme further next month

Australian shipbuilding - worth the effort?

So Australia’s naval construction program is risky. No sh*t Sherlock! Why did nobody say anything before?

With a decision imminent on which of the three bidders will build Australia’s Future Frigates, the majority of people who are fairly close to Australia’s shipbuilding plan have always accepted that it’s a risky venture that’s going to cause a lot of short-term pain. Are the rewards worth the pain? Let’s think about that for a moment.

Are we going to buy those submarines, frigates and patrol boats anyway? Yes. So if we don’t build them ourselves, and if we don’t insist on the highest reasonable level of Australian industry involvement, then most of the money we plan to spend will go overseas. 

But that’s supposed to be okay: the economists argue that we get the benefits of another’s efficiency. Some other country’s shipyards and equipment suppliers have been building ships for ages, so they’re good at it, so we don’t need to be good at it – we’ll just buy stuff from them. 

Really? Are we really going to spend $90 billions-worth of Australian taxpayers’ money enriching the taxpayers in another country?

What if we want to build that stuff ourselves? Well, the argument goes that we haven’t done much so we’re not good at it. So because we’re not good at it, we shouldn’t do it – it’s cheaper and easier to get it done by somebody else overseas (whatever ‘it’ happens to be - in this case ships and submarines; but the argument seems to be applied universally by pundits in Australia). But you don’t become good at something unless you practice. 

And what happens if you practice? You get better. At the end of the day, you might be better and cheaper than an offshore supplier; or you might be about the same, all things considered; or you might be slightly worse. The ANZAC frigate, Huon-class minehunter and AWD projects demonstrated that we actually get very good very quickly at building ships in this country – world-class, in fact. That’s the benefit of the learning curve effect, and it applies across other sectors of the defence industry as well as the wider economy. Yes, market volumes matter, which is why exporting and diversification are both so important. Guess what? The Commonwealth is trying to encourage defence companies to do both.

If you’re doing the job – building submarines and warships, or something else – in-country, and reaping the economic benefits that flow from designing, building, testing and maintaining stuff, and developing the industry-wide skills that can be applied to other projects and industries, you may be considerably better off. Especially if you then avoid, in down-stream phases, the financial and reputational costs of repeatedly starting up an industrial enterprise to build a few ships and then allowing it to shut down again, only for the process to be repeated. Each time you do that you almost guarantee delays and over-runs, not to mention quality issues, resulting from trying to mobilise an under-utilised, under-skilled and inexperienced work-force and customer. (Let’s not forget the customer plays a role in all this too.)

People who argue for the status quo tend to look narrowly at a specific project, ignoring the wider context. Yes, it’s expensive to either buy or build a submarine or a fleet of warships, but designing as much of them as possible in-country, building them in-country and designing and building in-country as much as possible of the equipment that goes into them can generate significant spinoff benefits beyond the project itself. No, there are many things we shouldn’t even contemplate trying to do ourselves, but that still leaves plenty that we can do, and the better and more efficient we get, the more of this stuff we can credibly claim for ourselves.

In a small-ish country with a small-ish population individual industry sectors generally aren’t big enough to support all of the specialist capabilities needed for self-reliance, let alone self-sufficiency in that specific sector – think of things like specialist metal coatings; specialist surface treatments; high-speed titanium machining; manufacture of high-end electronic chips; manufacture of high-strength metal alloys or carbon-fibre composites; highly specialised welding techniques; high-end industrial robotics, to name just a few. While an individual industry sector may not be able to sustain all of these capabilities in-country, a group of sectors with overlapping technologies and markets might – but they depend on each other to thrive. 

Even a struggling industry sector may still help underpin a technology pillar providing essential support to a bunch of other industry sectors. Without it those other sectors become less competitive. That’s the broader context that many commentators and policy makers ignore.

Conversely, if you invest in a new sector, or in reviving an existing one, you create spin-offs that benefit every adjacent industry sector. In this case we’re talking about manufacturing – that’s the smart stuff that people do with low-tech commodities such as iron ore, bauxite, titanium ore, coal and natural gas. And when they’ve done that clever bit, traditionally they have sold the resulting products back to the source of the coal, gas and ores – us.

So what’s the problem with investing in a new national shipbuilding plan? Andrew Davies in ASPI’s ‘The Strategist’ blog, said the process is a ‘shambles’. It’s certainly untidy but that, I suspect, is because the Government is having to make up six years of lost ground when the Labor governments of Kevin Rudd and Julia Gillard refused to make a single decision or invest a single dollar in building submarines and ships for the Navy. 

Now, we as a nation are trying to make up for lost time by building up enough momentum to clear the so-called ‘valley of death’ that’s resulted from those years of inactivity, and the picture isn’t pretty. Apart from the understandable concerns over the submarine and future frigate contracts, both of which are massive and will run for decades, there seem to be other areas of concern.

One of them is the decision to split the build of the Navy’s 12 Offshore Patrol vessels: two will be built in Adelaide by ASC, the remaining 10 in Fremantle by CIVMEC. Yes, that looks untidy and inefficient, but it has a couple of benefits: firstly, CIVMEC (or AMSEG, as it is now called) still gets a 10-ship build program at its Henderson yard – that’s important because it helps them develop management, engineering and construction skills and infrastructure which can then be turned efficiently to other projects. Secondly, it helps maintain engineering and shipbuilding skills at ASC that would otherwise be lost pending the start of the Future Frigate build. Remember how Australia’s shipbuilding industry atrophied after the finish of the ANZAC frigate program, and the costs and delays that resulted when we started re-mobilising the national workforce to build the first AWD? That’s the sort of problem the Government is trying to avoid here. Yes, it’s untidy and inefficient, but down-stream this approach ought to pay dividends. Read p.47 of the Naval Shipbuilding Plan: 

“The Government announced on 18 April 2016, that naval shipbuilding in Australia will be centred on two yards: Osborne Naval Shipyard in South Australia for major surface combatants and submarines; and Henderson Maritime Precinct in Western Australia for construction of minor naval vessels. This consolidation will focus investment, industry and workforce in an effective and efficient manner.”

That’s the intent: getting there will be a bit like making an omelette, leaving a mess in the kitchen and plenty of broken eggshells. Sorry, but given where we’re coming from that’s probably unavoidable.

This whole shipbuilding plan is about husbanding and growing efficient naval construction resources. The nine future frigates will be built in Port Adelaide in the same yard where ASC built the Navy’s AWDs. That yard is now in the Commonwealth’s hands but the workforce – from project managers and design engineers to welders and shipwrights – will still be there. 

Of course, we don’t know exactly what the submarines and frigates will cost us. The Future Submarine design hasn’t been finalised as yet. And the Future Frigate hasn’t even been selected yet, so we don’t know what the program will cost, nor what industrial arrangements will be put in place to build those ships. Meanwhile, the commentariat are already talking about ‘cost blowouts’ and ‘delays’. Really? 

As for the future of ASC, let’s wait and see what transpires after the Sea 5000 decision is made. My personal suspicion is that the Future Frigate program will have a rapid and significant bearing on ASC's future, but that’s just me. We don’t have room to discuss it here and I suspect I’d only be speculating wildly in any case.

Andrew Davies’s celebrated ‘shambles’ will start to resolve itself once the Sea 5000 decision is made and technical and schedule risk factors can be identified and quantified properly; the process will advance still further once the Future Submarine design is completed. Things are messy, which public servants and policy analysts hate passionately, but we always knew that would be the case. What’s different today is that we have defence industry policy being shaped by a strategic outlook, rather than a succession of narrow, transactional decisions devoid of any broader context. Does that make the rewards worth the pain? If we as a nation can reap the rewards of thinking strategically and becoming more pro-active globally, then yes it does in my opinion. 

JSF - concurrent development and manufacture: is this really a problem?

I was struck recently by an online story on the Flight Global web site, from which I reproduce the following three paragraphs:

“The [US] Department of Defense agreed with a Government Accountability Office report that it should resolve the Lockheed Martin F-35’s critical deficiencies before requesting funds to pay for full-rate production of the aircraft.

“Waiting for the resolution of critical deficiencies in the F-35 Lightning II could delay the aircraft’s full-rate production, which the DoD had planned to begin in 2021.

“The department had planned to defer resolving some critical deficiencies found in testing until after its full-rate production decision in October 2019, according to a GAO report released on 5 June. However, the report cited concerns that fixing deficiencies after starting full-rate production could eventually create additional costs tothe government.”

Yes, I can understand the logic behind the GAO recommendation, but it’s this very linear approach to multi-path innovation that creates (or compounds) many of the project delays that bedevil modern, complex acquisition projects such as the F-35 and, before it, the F-22 and B-2.

If you were going to retire all the risk on every aspect of the project before approving funding for the next stage or for Full-Rate Production you’d probably never complete the project. At the very least, you’d be looking at one hell of a slow schedule. 

Just to make it clear, I don’t have a problem with concurrent development and manufacture. In fact, I would suggest that the practice be endorsed more frequently by the Joint Program Office (and CASG here in Australia). However, this would only work if expectations were subtly modified. Read on. 

Consider: the F-35 program embodies all-new technology in multiple areas concurrently: airframe manufacture; mass-production of stealth features; helmet-mounted display; RF and IR sensor suites; flight control software; engine and vertical lift system; in-service support via the ALIS; and so on. 

Yes, you could probably prove many of these individual technologies (perhaps not the airframe, stealth mass production and vertical lift system, admittedly) in a bunch of separate risk-mitigation projects using existing platforms, or even just design and build a bunch of different aircraft that embody whatever selection of these new technologies is useful to their specific role. But I note that the three US customers for the F-35 (USAF, USN and USMC) chose not to do that. And none of the export customers had the resources to even contemplate doing that by themselves or in a non-US consortium, except for the Eurofighter consortium members – and the Eurofighter program predates the JSF by a decade.

Therefore, the decision to develop and build an all-new 5^thgeneration aircraft that embodied all of these technologies was probably inevitable – as was the subsequent decision to pursue concurrent development and manufacture of the F-35. If the JSF partner nations hadn’t agreed to do that we’d probably still be waiting for Low-Rate Initial Production (LRIP) to begin. 

Instead, we have more than 265 aircraft already delivered; the F-35A and F-35B are already in front line service with the US Air Force, Israel Defence Force and US Marines, respectively; and the F-35A has already been to war against the modern air defence systems the Russians have sold to their ‘friends’ in Syria. And the F-35 hasn’t even entered Full-Rate Production (FRP) yet. 

Think back 80 years. In 1938 the Royal Air Force was just starting to re-equip its fighter squadrons with their first monoplane fighters, the Hawker Hurricane and the Vickers Supermarine Spitfire. The Hurricane was the service’s first 300mph fighter, but it was largely fabric-covered, had the most basic version of the Rolls-Royce Merlin engine developing barely 1,000hp, and it was propelled by a fixed, two-bladed airscrew. The Merlin was still a developmental power unit and the fighter’s new reflector gun sight and eight-gun armament were also new and experimental. The Spitfire was a much more modern design but still had the same engine, twin-bladed airscrew, armament and gun sight. Both aircraft represented a revolutionary advance in air combat technology for the RAF.

But the early model Hurricanes and Spitfires, advanced as they seemed for their time, were only at the start of their development paths. Two years later, in mid-1940, just as the Battle of Britain was getting under way, they both had a much more powerful engine and a Rotol three-bladed, constant speed airscrew that transformed their take-off and altitude performance. The Hurricane also now had all-metal wings that reduced overall weight by 80lb while increasing maximum speed by 80mph. These were very significant improvements for their time. 

Importantly, the engine and airscrew upgrades were implemented on both aircraft as fleet-wide retrofits. The same went for the Hurricane’s metal wing. Was this expensive? Undoubtedly. But these retrofits were essential – during the early months of World War 2 the Hurricanes’ old fabric-covered wings and two-bladed airscrews put them at a huge disadvantage.

The point is that, firstly, the RAF had the aircraft in service to be retrofitted: if production had been delayed to allow testing of these and other important enhancements to be completed the RAF would have been woefully under-equipped and quickly overwhelmed. Instead, production continued and existing aircraft were retrofitted once in service; the sheer numbers mattered. Secondly, as a consequence, the RAF had two years before the start of World War 2 to train pilots and controllers and develop tactics and procedures to use the Hurricane and Spitfire effectively. Importantly, also, the RAF learned in peace time how to operate, sustain and repair its new generation of aircraft (including solving critical gun freezing problems at high altitude), not something you want to learn in a hurry, ‘on the job’. 

Fighter Command learned how to fight as a single complex, integrated organism of which the fighters were a critical part, though by no means the only one. Victory in the Battle of Britain was a collective achievement that couldn’t have happened if production of the Hurricane and Spitfire had been delayed. 

So how does this relate to the F-35? Early versions of the Hurricane and Spitfire were barely good enough for the job, but operational experience showed where investment was most needed in performance and combat capability improvements. Many of those improvements, such as reflector gunsights on the early Hurricanes and metal ailerons on the Spitfires, were retrofitted. 

The same applies to the F-35: if we accept that the aircraft will need to be developed through its service life to remain both relevant and superior, then we need to understand that a stated level of capability is merely a waypoint on a journey, not a final destination. It’s more important to have a design and platform that can be enhanced continuously and a mechanism for capturing constantly the creativity, technical smarts and operational insights that will guide each subsequent stage on the journey. In the meantime a less than ‘perfect’ aircraft can still provide sterling operational service and will provide invaluable training for both pilots and air forces.

Here’s a final thought from the 1940s: the Spitfire remained in production for a decade, through 24 marks; it saw the introduction of a new engine, Rolls-Royce’s Griffon which had nearly twice the power of the early Merlins, and finished with twice the take-off weight and twice the range of the initial version. Almost every aircraft since then that has had an extended production and service life has enjoyed similar growth in operational capability. The final capability in each case has been unforeseeable to the original designer of the aircraft in question, but usually resulted in the aircraft themselves becoming legends. Think F-86 Sabre, F-4 Phantom, F-15, F-16, F/A-18, Hunter, Harrier, Canberra, Su-27, MiG-21, Tornado strike variant and Mirage III and 2000. 

Having something that’s good enough today can be more valuable than having something that’s perfect tomorrow. Firstly, you need to survive today in order to have any hope of making it as far as tomorrow; secondly, we can’t foretell the future, so nobody really understands what ‘perfection’ will mean tomorrow in any case. So we need to design for what we can see and credibly predict; once the aircraft (or tank, or submarine) is in service we can predict the next developmental stage with much greater confidence. We can build an upgraded design to meet the new challenge, but we should also incorporate as many as possible of these changes on existing aircraft (or tanks, or submarines). 

If that means concurrent development and manufacture, then so be it. If the alternative is an interminable wait for a mythically perfect machine which enters service too late to be relevant, that’s unacceptable. 

ENDS

The 12 Preconditions for Innovation Success - 2

Innovation is something new for many Australian companies reared on a diet of ‘build to print’ and tiny portions of genuine opportunity. The word itself engenders suspicion: is it a ‘buzz word’? A fashionable pre-occupation? It’s certainly not widely understood.

Regardless, Australia’s defence industry needs to understand and master the process of innovation. In a previous post I looked at innovation from the point of view of the defence customer; this post addresses innovation from industry’s point of view.

If the customer is being truly innovative this has significant implications for his industry and supply base: defence companies will be exposed to the operational and technological needs of defence forces and the global prime contractors in a way they’ve never experienced before. To survive, to flourish, they must become innovators too.

For anybody who thinks the defence industry is special, by the way, I have news: it’s not. The defence market is special and unique, but the defence industry is like any other high-tech industrial market for capital goods and services. The good news is that that factors that make a non-defence company a successful innovator apply also to defence companies, so there’s plenty of supporting literature and no black magic involved. Of course, every project is different, some subtly, some quite significantly, but for the majority it emerges that there are common pre-conditions for innovation success. They’re quite independent of a specific project – they’re more generic and they go to the intrinsic attributes and routine behaviours of the organisations involved.

Boiled down to their essentials, this is what I believe they are - and none of them are surprising or counter-intuitive:

1. Appoint a company leader who’s open to constructive change and keen to innovate
2. Organise yourself to innovate: an organic (as opposed to a mechanistic) structure enables and encourages cross-functional communications as well as creating conditions for lateral thinking and idea generation (if necessary, create such a group within your organisation)
3. Work towards technical mastery of the domain in which you’re operating: the products, the technology they embody and the technology and expertise required to build them
4. Be pro-active in dealing with your customer – both determining his needs and sensitivities, and testing ideas and hypotheses on him (In Australia this means the ADF, DST and the bureaucracy)
5. Invest in your R&D and prototyping capabilities
6. Conduct R&D systematically, guided by your market knowledge (see 8, 9 and 10 below)
7. Be open to external partnerships and sources of technology and IP
8. Understand the market in which you’re operating: who the players are (customers as well as rivals, and even suppliers and sub-contractors); why they’re in the market; what’s happening with technology; what else is going to shape the size and behaviour of the market in the future?
9. Understand your market position and what (if anything) you need, or intend, to do about it
10. Be systematic in your marketing activities (which includes encouraging lateral thinkers and good ideas!)
11. Create a cross-functional team to integrate market and technical knowledge and then develop and deliver the project
12. Appoint a leader of this team who has REAL authority to drive the project along

Once defence companies understand that their industry sector isn’t that different, they can then look at their structures, intrinsic attributes and behaviours, and then start to apply some of the lessons you’ll find in books by a swag of authors who’ve studied innovation success in depth: people like Amantha Imber, Roy Rothwell, Jeff Dyer, Nathan Furr, Clayton Christensen and Steven Johnson (Google them); and there are others.

Defence companies can learn a lot that’ll help them on their journey, and it’s now a journey with a better-defined destination. The Defence Industry Capability Plan and Defence Exports Strategy may provide better directions, but from where I'm standing, close to the start line, you will still only get there by embracing the challenges of the innovation process.