I have just finished reading the
Auditor-General’s review of the Cyclone and Chinook purchases and some thoughts as a one-time Project Manager, but with no Defence connections (I work in the food industry) come to mind (beware – I am about to make a fool of myself again):
Auditors and accountants generally check performance against the rule book and not against real world requirement. If the rule book describes a flawed process, that is not their problem. Disregard that changing the rule book literally requires an Act of Parliament.
Next has to be noted that great store is set in having all the information set in detailed specs early on in the process and that they should not change throughout the process so as to permit a “fair and transparent process”. This is an unrealistic requirement.
Requirements change rapidly in a high tempo operational environment. Currently there are literally thousands of operational helicopters generating lessons learned daily and manufacturers are routinely producing new counters to new threats. Requirements must change, and thus so must specifications, otherwise the aircraft (item of any sort) will be heading to obsolescence before the first unit reaches Initial Operational Capability.
Time delays don’t improve this situation as manufacturers are constantly upgrading their catalogs and dropping old equipment for new lines. Options: Less expensive but less capable or more expensive but more capable. The sweet spot you were planning on is no longer available because vacuum tubes and the stoker’s shovel necessary are no longer manufactured. Do you want to go up or down?
It is not clear to me that anyone in the Auditor General’s department has a clear understanding of what it is to negotiate a contract. Of course there are minimum requirements – but there is also the art of getting the highest value at the lowest price. Consequently, during negotiation, it is usual to beat up the supplier and demand that that chrome plated gew gaw be included or else there is no deal. This contributes to the common practice of rewriting “final” contracts 6 or 7 times in the last 24 hours. Capabilities are traded for dollars. Such practices however, are inconsistent with the Auditor General’s requirement that you only buy what you asked for 24 years ago. That and that alone.
Additionally I am at a loss to see how it is possible to put the Chinook, even with extended range tanks, into the same developmental category as the Cyclone which was always a “paper” exercise with Sikorsky making promises. Of course the problem wasn’t helped by a the government of the day determining that they would do what was necessary to avoid further political embarrassment and mess with the specs and the competition to ensure that the only flying aircraft in the category, the EH101, was not acquired.
On the other hand, to my understanding (but here I am on very thin ice) the Chinook is flying with all the modifications that DND wanted, just not all in the same airframe. This does represent a developmental risk but not on the scale of the Cyclone with its untried powerplant, its revised gearbox and its fly-by-wire control system.
Finally, although the A-G headlines a 70% increase in airframe costs and a reduction in airframes from 16 to 15 the project at large seems to be coming in with about a 15% total capital overage (2.3 BCAD vs a projected capital cost of 2 BCAC). I’m used to working with about three less zeroes on my calculator but overall I don’t find the project to be that far out of spec.
As to estimating support and O&M costs......you can’t write a budget on the day you identify the requirement and the one you get when you sign the contract will be invalid the day after.
The one lesson that I have learned from doing projects is: Decide early and act fast. Tomorrow's decision is no better than today's for you will always be dealing with an environment that doesn't precisely match the one you planned for.