There’s one duty that incoming Department of Defence secretaries often prioritise that Greg Moriarty — whose appointment was announced on Friday — will be expected to skip: reshape and streamline the organisation.
There has been so much disruption, so many cooks in the kitchen, that the last thing Defence needs is another aggressive change management CEO.
Defence, it’s fair to say, is already shook up. Since legendary Arthur Tange’s review some 44 years ago that merged four departments into one — and created a perennial soft target for accusations of government bloat – it has embarked on no less than 45 reform efforts ranging from all-encompassing like the great Defence Reform Program (“purple people eater”), to service-wide like New Generation Navy, to targeted in areas like intelligence (Brady) or personnel (Cross).
Senior officials, both Defence APS and uniformed, who spoke with The Mandarin in recent days characterised the supersized organisation as “finally being in a good place” two years into the implementation of the First Principles Review’s “One Defence” reform that expanded the strategic centre, returned accountability to capability managers, and attempted to give public servants a more defined place next to the Navy, Army and Airforce.
A common theme of their concerns was that it was time to get on with the job of ensuring the security of Australia and that means acknowledging the world is not the same place as it was when the 2016 Defence White Paper was written. Australia may have its most reliable friend yet in US Defence Secretary James Mattis, but his boss, Donald Trump, is anything but reliable. Indeed, Trump is hastening the multipolar world that the Australian government is already preparing for. Who knows how much worth the ANZUS treaty will be when shipping lanes far from US interests are further threatened.
Australia doesn’t need another SecDef with close ties and deep understanding of the US government. It needs more friends of Indonesia — like Moriarty who served as Ambassador to Indonesia from 2010 to 2014 and to boot is also a graduate of Australia’s war college.
Indonesia, with its massive, if poorly trained army is experienced in island hopping and rebellion crushing — capability we can’t buy from the US. A squadron of F-35s can’t win an archipelago war by themselves. With ISIS now established in the Philippines, this regional threat has to be a priority, even if it is still getting very little public discussion.
Moriarty has much less experience than previous secretaries of Defence, none in the top tiers of a mega-department like Defence, and none as a CEO. That’s not a bad thing. It’s an opportunity for Defence to move on from orthodoxies, and prepare for the post-Trump world. Moriarty is more qualified to do that than any of his predecessors — many of whom were legends of their time, but largely stuck to inward looking organisational issues.
Four cultures, one purpose — two years later, how has One Defence fared?
As much as Moriarty needs to focus on those strategic issues, there are still kinks to work out in the One Defence restructure. The Australian National Audit Office is not happy with the “limited progress” on Materiel Sustainment reforms after 18 months and the budget still messy (unreliable data on spending, says the auditors).
“Based on the ANAO’s review of a quarterly performance report (QPR) produced during the audit, its contents are neither complete nor reliable, it takes two months to produce and its contents are sometimes difficult to understand.”
But for the first time, it’s now easy for top officials, ministers and auditors to see which sustainment products are underperforming.
That’s just one small improvement among many from the FPR recommendations that Defence has delivered on, even though it won’t earn the favour of some inside the organisation who stand to lose face and in some cases entire projects.
Defence says it has implemented 67 of the 75 recommendations made by the FPR team. That team has been invited back to form an Oversight Board and recently conducted a ‘Health Check’ on the progress. That report will make its way to the government in due course.
Evaluation has also been built into Defence’s implementation, but the details are still unknown to The Mandarin.
Some of the highlights include restoring accountability to capability acquisition and sustainment by making the service chiefs responsible for the full lifecycle from early concept to use in theatre, and moving the former Defence Materiel Organisation back into Defence. A defence spokesperson said:
“This one change eliminated the administrative burden of having to manually process 72,000 financial transactions between Defence and the Defence Materiel Organisation every year.”
Wasted time has been eased across the board, with the Defence Procurement Policy Manual reduced from 450 pages to 60. Mandatory procurement requirements asks of suppliers has been reduced from 290 to 53. The average submission to government has gone from 70 pages to 20, from a 16 week cabinet preparation process to 6, from a 46 month average to move from first pass imitation to second pass approval to less than a year from gate 0 to second pass.
Approved Defence submissions in 2016-17 is close to double the previous highest number.
The strategic centre is stronger, more collegiate than ever before. While still technically a diarchy, with the departmental secretary and Chief of the Defence Force (currently Air Chief Marshal Mark ‘Binnie’ Binskin), the decision-making has effectively been more evenly distributed with the Vice-Chief of the Defence Force role is itself now larger than most departmental secretaries in government, and new Chief of Joint Capabilities. As mentioned, service chiefs of Navy, Army and Airforce are the capability managers, with buck-stops-here authority for the entire lifecycle. There was a massive cut of almost half the committees chaired by the top ranks to accommodate this new division of labour.
There has also been a strident push on agreed leadership behaviours and performance management, a topic The Mandarin will explore in detail later this week.
By all accounts these changes have been exhausting, and somewhat unexpected given the history of failed reforms in Defence.
Deputy secretary Roxanne Kelley, who was assigned to oversee the initial implementation of the FPR recommendations, remarked in a presentation to the Project Governance and Controls Symposium at the onset that Defence could be accused of being addicted to reform reviews.
Every time a review is conducted it finds the organisation is ill-equipped to meet the current challenges, necessitating a reorganisation or reprioritising of some kind — because what reviewer would ever leave the recommendations page blank and what government would ever reject a Defence review’s recommendations. If the government doesn’t like the outcome, order a new review – that’s how the latest FPR got started when the 2013 Defence White Paper was too closely associated with the other side of politics.
Is there no clearer picture – and thanks again to Kelley for this remarkable illustration – that it’s time to get on with the job?
Top image: Greg Moriarty during his tenure as Australian Ambassador to Indonesia. AAP/Karlis Salna