Last week, Defence Procurement Research, Technology & Exportability 2013 surpassed all expectations. The one-day showcase presented policy makers, technology users and technology producers with an unrivalled platform to explore the evolving multibillion-pound defence procurement sector and identify new business growth opportunities within the UK and overseas defence and security markets. Here, MOD DCB features writer Antonia Holmes reviews DPRTE 2013, and looks ahead to the 2014 conference.
Delegates from the length of the UK converged in record numbers on the UWE Bristol Exhibition and Conference Centre on 20 November to attend a one-day event showcasing innovative defence procurement for both buyers and suppliers – Defence Procurement Research, Technology & Exportability (DPRTE) 2013.
The UK’s leading defence procurement event provided MOD buyers and industry with a unique opportunity to interact and develop new routes to market, ultimately helping shape the future of the UK defence sector.
Partnered by the Ministry of Defence’s Defence Equipment and Support (DE&S) organisation, the Defence Science and Technology Laboratory (Dstl) and the UK Trade & Investment Defence & Security Organisation (UKTI DSO), DPRTE 2013 presented buyers and representatives from academia with time-relevant market intelligence, while the dedicated knowledge transfer zones aimed to strengthen both individual and organisational performance across established defence Primes and innovative niche SMEs alike.
Following the success of the inaugural Defence Procurement Research & Technology (DPRT) event last year, this year saw Exportability added to the mix. Trade has been a headline issue in recent months, with the Government keen to drive export success as it strives to reduce the deficit. The Product Demonstration Zone was also new to DPRTE 2013 – proving this is a showcase that will continue to expand to address current market demands surrounding innovation and manufacturing across a range of industry technology sectors.
Ninety-plus exhibitors were in attendance at DPRTE, ranging from micro SMEs to higher-end Primes, with the majority looking to find new routes to market.
Kinson Smith, a new firm which only formed in 2012, displayed its Flexible Lifting and Carrying System (Flacs) – a patented product which enables easy transport of injured persons. This innovative design has no match in the current market, and caught the attention of MOD buyers at the event.
Other exhibitors included Digi-Box, which currently holds a contract with NATO. They exhibited their range of high-performance video products for mission-critical systems. As an SME, Digi-Box’s core purpose at DPRTE was to showcase the broadcast quality of their command and control applications to break into the technology transfer market.
Prime contractors such as AgustaWestland, positioned in Knowledge Transfer Zone 2, were keen to hear from young innovative companies developing technology for rotorcraft. Boeing Defence UK Ltd and Babcock were situated close by, and received regular visits throughout day from both established and aspirational companies looking to gain industry insight.
Live Keynote Conference Arena
As expected, the Live Keynote Conference Arena was packed with delegates seeking to enhance their knowledge in the defence procurement sector.
First up was Steven Morgan, Director Commercial Operations at DE&S, who is accountable for the effectiveness of procurement management and supplier relations relating to defence equipment and systems including ships, aircraft, vehicles and other military hardware from an annual defence spend of £14-20 billion.
Mr Morgan said: “MOD is changing, we’re becoming a more intelligent client. And as potential suppliers you probably need to pay some attention to what’s happening.
“The first thing I want to mention is we need help from you. The help is for a smaller military – we’re going to have a smaller civil service as we continue to shrink; we’re going to outsource more of our non-core work; and we have to recognise that our military is going to need fresh ideas and innovation, and that means technology because we’re going to have fewer people in harm’s way. We’re going to need to rely on to give our war-fighters an extra chance in the field.
“It’s important for us to reduce our excess capacity, our excess cost. We can no longer afford an industrial base the size we have had in the past. We have to be more operationally efficient and that means we have to eliminate low and no value features of the products that we buy. It is not uncommon for us to have disproportionate requirements that are too expensive. We need to make sure that our contractors are better aligned with us and our MOD objectives. All too frequently we create adversarial contractual relationships, so we need to have more performance-based contracting and incentives that are not just based on cost. What we want to do is get the appropriate best value.”
Mr Morgan noted that where contractual difficulties arise it may be down to government’s ‘failure’ to keep promises, highlighting that good procurement relationships are important and a key factor in the MOD’s evolving direction of travel.
He continued: “We need to write good aligning contracts, where there are good incentives, where it encourages positive behaviours on both sides – and by that I mean collaboration. It is in my best interest if I write a good contract to support you, to be able to help you find your problems early enough, to be able to move obstacles out of your way and in some cases to intervene to reduce unnecessary requirements. Enforcing the contract does not necessarily mean against you – most of the claims against government are a result of failures by government to do what it promised to do, whether it’s providing government-furnished equipment or answering a question or request for information that you make. A good client should also be responsible for integrating the outputs to make sure that the pieces of the bicycle fit together; we need to seek those companies that can help us do that.”
Enthusiastically echoing Steven Morgan’s words of change and the ‘we must work together’ ethic was Dstl Programme and Delivery Director Richard Brooks. At Dstl Richard is responsible for the planning, formulation and delivery of defence’s overall non-nuclear science and technology programme.
As a nation we spend some £28 billion a year on R&D, 60% of that within the private sector. Of the 40% spent within the public sector, 10-12% is focused on defence, security and aerospace. Each year the Government spends £600 million in the defence and security R&D arena. Mr Brooks outlined the importance of international collaboration, PhD sponsorship, strategic partnerships and civil technologies, and discussed the key areas of spend within Dstl.
He said: “As you would expect, Dstl does research into military technologies. We will be doing the initial early concept work for the next generation of defence equipments; we will support them in-service; we will provide advice on their disposal; we will provide capabilities to help enhance them –it’s the essence of defence research and technology.
“Some of our strategic partnerships are contractual, while some are non-contractual partnerships in which we share expertise. And their nature is starting to change. There is more mutual reliance, as well as reliance on the private venture investment that comes from those partners too. I think where we are different to the equipment world is that we are operating at a much earlier technology level, and we need to have more involved and integrated partnerships.
“The collaborative enterprise is probably one of the most important elements of how we undertake science and technology today. We collaborate with NATO partners, with about 40 nations in total. We jointly fund a lot of work, and we are entering an era of mutual reliance – we cannot afford to undertake all the science and technology that we need, all the facilities that we need, nor can other nations. Taking that step to rely on another nation to provide S&T has been quite a challenge for us, but a necessary challenge as we grow those links into international collaboration. 20-25% of our national programme is delivered collaboratively. And the breadth of that enterprise is essential to make sure the UK gets the best value out of that. We have recognised as well that it’s not just about what we do today, it’s about seeding the enterprise for the future as well.
Paul Everitt, Chief Executive of leading trade association ADS and Chairman of Farnborough International Ltd, spoke about the Defence Growth Partnership (DGP) – a partnership which will drive new forms of SME/MOD engagement.
He said: “The key areas for me are: why are we doing the DGP?; where has it got to?; and how are we engaging with SMEs?
“There is a very strong commitment from government to foster economic growth. A number of industrial strategies have already been published, many based on successful partnerships. One of those is the Aerospace Growth Partnership (AGP), based on the civil aerospace agenda.”
Mr Everitt touched on the importance of exports. This topic was raised at an earlier Keynote Address by UKTI DSO Assistant Director Arfan Chaudhry, who outlined trade opportunities in Latin America for those companies keen on exporting.
Mr Everitt added: “If you look at the global defence industry, everyone is in a very similar position: domestic projects are under pressure, and the route to success is exports. Part of our job for the DGP is ensuring that the UK is a winner in these more difficult and demanding marketplaces.”
As with Steven Morgan and Richard Brooks, there was a common message within Paul Everitt’s talk – the importance of good relationships, working together to improve service, and driving economic growth.
He continued: “The DGP is a partnership with the highest level of support – the Prime Minister announced the desire for a DGP at last year’s Farnborough International Airshow. The involvement of the MOD as the primary customer makes it a different sort of industrial partnership to those we have seen in other sectors. One of the underpinning rationales for industry engagement here is that we will only be successful in global markets if we are able to satisfy the most demanding of domestic customers. So our route to success is doing good business with the MOD and having them help us deliver an improved service.”
Other speakers at this year’s event included Richard Blake, Deputy Head Commercial at the Defence Infrastructure Organisation. Richard covered the DIO’s HESTIA programme, noting that new contracts are to be published by year’s end.
Production Demonstration Zone
DPRTE 2013 provided commercial organisations with the opportunity to showcase their latest innovations. Companies appearing at the Product Demonstration Zone included TRaC Global, Frazer-Nash and Corner Cable Systems – who took the mystery out of fibre optics with their demonstration. This new zone provided buyers and suppliers with an insight into product developments in the marketplace and proved popular with attendees.
Buyer Engagement Village
Attendees at DPRTE found the Buyer Engagement Village so beneficial that the appointment schedule was fully booked. Delegates enjoyed this unique opportunity to engage directly with MOD Project Teams including the Helicopters Operating Centre and Land Equipment Operational Infrastructure Programme Team, as well as Prime Contractors.
Knowledge Transfer Zones
UKTI DSO fronted Knowledge Transfer Zone 1 – a dedicated area designed to promote business growth and outline routes to market at home and overseas for SMEs. Dstl led on innovation and emerging technologies in Zone 3, while Prime Contractors including Boeing,and Babcock presented to potential sub-contractors in Zone 2. Finally, Zone 4 saw information delivered on the forthcoming EU Procurement Directive by an experienced PASS consultant.
Grahame Steed, Managing Editor, MOD Defence Contracts Bulletin (MOD DCB) and Chairman of the DPRTE 2013 Keynote Arena, said: “DPRTE 2013 demonstrated again what a dynamic, innovative and exciting market defence and security is. Its potential is almost limitless, as demonstrated by the range of cutting-edge products and services showcased across the exhibition floor, the plans and opportunities outlined by the speakers in the Keynote Arena, and the countless conversations between buyers and suppliers on the day. The times are changing: the MOD has become more transparent and is further driving competiveness and innovation in the marketplace. We are already looking forward to DPRTE 2014.”
For more information, visit: www.dprte.co.uk