The keel-laying ceremony held last week for the third destroyer, Sydney marked significant progress for the Air Warfare Destroyer Alliance. This is the latest in a series of important achievements across the project with this particular milestone marking the start of the hull consolidation phase for Sydney while, at the same time, the first ship, Hobart, enters her Combat System activation phase in advance of sea trials next year. The second destroyer, Brisbane, remains on track towards the completion of its hull consolidation, with stern-release performed last week.
The culmination of those events provides an appropriate opportunity to take stock of the considerable progress made on the AWD program and the challenges that the AWD Alliance has overcome.
It has been natural that the high profile nature of the largest defence project in Australia would put every construction issue on public display. It’s in this context that the significant challenges of the AWD project have all been amplified. However, what hasn’t been heard as clearly are the many accomplishments of the program including:
- progress through functional design;
- establishing and starting-up the Osborne shipyard facilities from a ‘brown-field’ site;
- procuring significant quantities of equipment;
- developing the support system for three ships;
- burning-down the system integration risk through development and use of the various shore facilities; and
- the launch of the first ship, Hobart, in May this year.
Of equal significance have been the people-related aspects of those achievements, in particular, the coming together of vast numbers of skilled individuals from various backgrounds to forge a focussed and highly performing AWD Alliance team.
The extent of those achievements should be recognised in a clearer context when it’s understood that many of the AWD’s challenges were inevitable given the nature of the construction of a first-of-class ship being built by a new workforce in a new shipyard. I have been constantly impressed by the resilience with which those working within the AWD Alliance have been able to meet the challenges, sometimes in the face of open and public criticism, and in a situation where we’ve actually welcomed the scrutiny that our project has attracted.
The AWD Alliance has worked alongside the Government to address issues on the program. We were active participants in the Australian National Audit Office performance audit of the project, concluded early in 2014, as well as the Winter White Independent Review that took place shortly thereafter. Such activities have been beneficial in identifying what has transpired in the project and in prioritising the things that needed to improve.
We subsequently conducted the Comprehensive Cost Reviews, or ‘forensic audit’ as it became known, which revealed amongst other things that the projections for final costs across the overall program had risen by a total of 22%. The information gleaned from the Comprehensive Cost Review led to the strong decision by the Government to contribute a further $1.2 billion to the program, announced at the same time that the first ship, Hobart, was launched in May.
This figure of 22% is significant, and should provide a sober yet realistic perspective on the challenges the project has faced.
Now, almost a year after the Government announced the interim stage of its AWD reform strategy, I can confidently say that the AWD Alliance is on a stable path towards delivery, with a firm understanding and commitment to the cost and schedule outcomes, and detailed plans in place to drive further improvements. The Alliance has also been a large part of the solution to the program’s challenges. Our work has continued apace as we welcomed the injection of experts from BAE Systems, Navantia and Raytheon Australia, who have provided a broad range of recommendations to improve performance.
The Alliance should be proud of all that is being achieved—in particular, the substantial ship-over-ship performance improvements. Productivity has improved by more than 30% from Ship 1 to Ship 2 and a further 10% from Ship 2 to Ship 3. The work being carried out on Ship 3 is particularly important, as the most productive work of the Alliance will be demonstrated here, based on the lessons from her sister ships.
It’s against this backdrop of substantial program improvement that I announced last week a number of leadership and governance changes being enacted within the AWD Alliance. As part of these changes, I have decided to step down from the role of AWD Alliance Chief Executive and have been promoted to the AWD Project Board as the representative of Raytheon Australia.
Lloyd Beckett, another Raytheon employee, who has been with the Alliance since the beginning of the year, has been appointed to the role of AWD Alliance General Manager.
Lloyd brings a wealth of global experience in the shipbuilding industry. The AWD project will be his fourth first-of-class ship build, following his involvement with major shipbuilding projects in the US including the CG-47 guided missile cruiser, the DDG-51 Arleigh Burke destroyer and LPD-17 class of amphibious ships. He has nearly 35 years of experience, working on some of the world’s largest defence projects including the Patriot air and missile defence system and the Zumwalt DDG 1000 guided missile destroyer. Lloyd has extensive knowledge of Aegis-equipped ships and I’m confident that he’ll maintain the stable path that we’ve set for the project.
It has been exciting for me to have been a part of the AWD project for ten years and a special privilege to have led the Alliance team for the last six years. As someone who has contributed to the program for such a period, enjoyed the successes and worked through the challenges, I remain committed to the concept of the Alliance and its potential to generate strong program outcomes through effective relationships and behaviours built upon collaboration, cooperation and trust.
Last week’s keel-laying for Sydney, together with the launch of Hobart earlier in the year, are reminders that the most important thing about the endeavour of the AWD Alliance is the ability to work together with the common purpose to deliver the most technologically advanced and potent capability the Royal Australian Navy has ever possessed.