Defence Value For Money

This section of the website has been set up to support the ongoing programme of work by the UK NAO Defence Value for Money Team, to better understand what drives the performance of major defence projects.

Introduction

 

For the last 20 years the annual Major Projects Report has highlighted the variable performance of the Ministry of Defence’s (the Department’s) highest value defence equipment procurement projects, many of which have suffered cost overruns and delays.

This performance has been a matter of concern for both the Department and Parliament, and the Department has introduced a large number of reforms designed to improve project performance.

To help understand why sustained improvements in performance are proving so difficult for the Department and its industry partners to deliver, we analysed the complex cultural and systemic drivers which need to be managed if military capability is to be delivered faster, cheaper and better. The results of this work can be viewed by clicking on Project Control/Phase 1.

Working with the Department, we are undertaking a series of studies examining some of the drivers identified by our initial modelling in more detail.

Each study will examine practical evidence of how well a specific driver is being managed in the defence environment and explore how that driver is addressed by overseas and commercial comparators.

Each study will compare current defence performance to a theoretical “gold standard” developed from this comparator work, against which no individual organisation is likely to perform consistently well in all areas.

The recommendations in this and subsequent reports are intended to bring improvements in defence acquisition performance to help ensure all defence projects routinely adopt practices closer to our “gold-standard”.

 

We have completed the first two reports in the series.

The first one examined the effectiveness of project control on defence projects.

For the purpose of our analysis we have defined project control as including how progress is tracked and decisions made on projects to ensure successful delivery, and the structures and processes which need to be put in place to underpin these activities.

We chose project control as the first area for examination because it is a critical linking factor between a number of the key drivers of successful acquisition identified by our earlier work including management information, governance and assurance, risk and cost estimating, and ultimately budgeting and funding.

The second report examines how the Department and industry can best use the contract to maximise the likelihood of successful project outcomes.

An important factor in ensuring project success is choosing the right contracting strategy. Selecting the right one however, given the complex nature of MoD procurement is no easy task.

We asked IBM consultants to help us to develop a tool to aid Departmental and industry teams in making a better informed choice of the contracting strategy mot suited to the circumstances of the procurement.

 

Contact:
,