Qinetiq Australia has increased orders and revenue significantly in two years through organic growth alone. Its acquisition of Australian logistics support provider RubiKon in February is part of a new parent company focus on growing business in the Asia Pacific. ADM's Philip Smart spoke to managing director Greg Barsby about where Qinetiq sees itself in the Australian defence market, and its plans for the future.
ADM: Qinetiq is well known for its engineering and design support for RAAF platforms and fatigue testing on platforms such as the Hawkei light protected mobility vehicle. What are some of the perhaps lesser known fields of expertise?
Barsby: Our structural integrity capability in the country grew out of one of the heritage businesses we acquired, Aerostructures; hence the recognised strength in the aircraft structural integrity space. But we’ve done other work on maritime programs and even land programs. We’re well known for our expertise in submarine acoustics for example, even in propeller design.
Not only that, we have world leading experts in parametric costing and other kinds of associated business advisory work. We’ve built up those skill sets over decades through our long-term association with major defence programs.
We work with DST Group at Fishermans Bend, managing their Specialist Engineering Services facilities down there. We’ve run their engineering design and prototype workshops on their Fishermans Bend site for seven years now.
Our technical experts work side by side DST Group to help solve complex problems and to support and transform Australia’s defence and national security. From specialist engineering design to prototyping and bespoke manufacturing we provide customers with a wide variety of integrated engineering and scientific technical support.
ADM: How does Qinetiq Australia differ from the UK parent in services or focus?
Barsby: Globally, Qinetiq is a company of over 6,000 scientists and engineers who work across the entire capability life cycle to provide technological and scientific expertise to help our customers protect their vital interests.
In the UK, Qinetiq’s core capabilities are Test & Evaluation; Robotics, Training, C4ISR and Cyber. Locally, we are known for our delivery of integrated solutions, technical expertise, deep domain knowledge and rigorous independent thinking.
One of our core values is collaboration. The collective capability of our global organisation relies on working collaboratively across boundaries with colleagues and partners alike, and we are committed to leveraging core capabilities and expertise from across the organisation to benefit our customers.
Profile Greg Barsby
- 2014 Managing Director Qinetiq Australia
- 2013 Director Defence & Government Services KBR
- 2009 General Manager KBR Training Solutions
- 2003 General Manager/Part Owner CatalystInteractive
- 2001 Officer Commanding Technology Based Training, Australian Army
- 1996 Joined Australian Army
- 1994 Graduated from James Cook University, Bachelor of Education
- 1992 Graduated from Griffith University, Bachelor of Science
ADM: As an independent consultancy Qinetiq has avoided becoming associated with a particular prime contractor or platform manufacturer. Do you intend to maintain that strategy?
Barsby: We do lead programs of work but they are not platform provision programs. We lead advisory programs and we operate technical facilities for DST Group, but again we are working for and on behalf of our customer there. We are certainly interested in supporting our customers with range management or other test and evaluation, asset management and operational training programs that draw on our deep engineering expertise.
But we are not in the business of manufacturing platforms. That’s not our part of the market. We support primes in platform provision programs, usually with particular engineering expertise, certification, modification and assistance across the whole capability life cycle.
We maintain our independence from that perspective. Qinetiq has been working quite independently for such a period of time, it’s ingrained in the way we work and allows us to keep the focus on what’s best for the customer.
ADM: Qinetiq Group has named organic growth as a priority goal, particularly for its “home markets” such as the Asia Pacific. How has Qinetiq Australia fared in delivering growth for the group?
Barsby: In Australia we’ve grown across all metrics organically. Excluding the benefits of Rubikon, over the past two years we’ve grow our orders and revenue significantly and all organically.
And that organic growth has been driven by focusing on what we do best, improving our customer service, pursuing programs of work and providing advisory services to our customers across defence and industry.
Following the RubiKon acquisition, we’re now at 350 people across Australia, where two years ago we were about 200.
ADM: Now that Qinetiq has extended its core test and evaluation contract with the UK MOD out to 2028, the company has begun to focus more on developing other markets around the world. How will that strategy affect the Australian operation?
Barsby: There are three pillars to Qinetiq’s growth strategy; core defence test and evaluation capability in the UK, growing its international business, which is the exciting bit for us here in Australia, and the third pillar is driving commercial and technical innovation across the group.
The strategy of international growth is a marked change for Qinetiq. The global group is committed to driving growth internationally through investing in its home markets, such as Australia. As a home market with a significant defence spend and proximity to the Asia Pacific Region, Australia is a particularly attractive market from a Qinetiq Group perspective. Given our improved performance over the past two years we have significant Group support for ongoing investment.
ADM: How does the RubiKon acquisition fit with Qinetiq’s strategy?
Barsby: RubiKon was an important acquisition for us, very complementary to our core engineering and technical base. The addition of RubiKon’s capability allows us to position ourselves to more effectively offer whole of program solutions to our customers. I think that’s evidenced by the fact that as a consortium we won the Air 7000 program.
We’re very well known for deep engineering and technical expertise and other business advisory services. We needed to round that out and bolster our program management capability and pulling in RubiKon’s core integrated logistics support capabilities.
ADM: Is Qinetiq looking for other potential acquisitions?
Barsby: Looking at how attractive Australia and the Asia Pacific region are and given the improved organic performance we’ve had out of Australia over the last two years, we will continue to look at acquisitions and other investments in Australia that are complementary to our core capability and aligned with our Group strategy. We are fortunate that Qinetiq has a very strong balance sheet, which gives us the financial resources to invest in the business.
ADM: RubiKon primed the Air 7000 strategic support partnership bid, but Qinetiq has a history of partnering with several other companies on specialist projects. How has that worked for the company?
Barsby: We recognise that both growth and value can be strengthened by effective partnering with both Australian SMEs and larger primes. For this reason we partner with more than 80 suppliers, many of whom offer outstanding niche capabilities valued by our customers.
The benefits and value afforded by collaboration and co-creation drive us to enter into effective partnerships, often with those who may have been considered traditional competitors. We have a fantastic working relationship with Nova Systems and we’ve partnered on multiple opportunities.
Working with partners from academia is also a critical success factor in Qinetiq’s corporate strategy. We have active research projects with 20 universities and our Global Chief technology Officer runs a scheme that currently funds some 18 PhD students at 14 universities. We lead nine research consortia comprising 35 universities and numerous companies from a broad range of industry sectors.
ADM: How do you see the defence market in Australia, and what are the factors affecting it?
Barsby: I think the environment’s very buoyant at the moment, I see evidence of the kind of changes government’s aiming for flowing through to industry. We tend to work a little forward in the program life cycle and we’ve had two great years of growth, so that’s testament to effective change within the defence market. Definitely, feedback to me from people across the industry is that government’s desire to ramp up higher end manufacturing capability across Australia to contribute to these programs is flowing through.
Many Australian companies have won work on the JSF, with Australian Defence Industry beginning to work more globally. Credit: Lockheed Martin
You see the media releases from some of our SMEs, getting work on major programs like JSF. So from my perspective it’s definitely starting to flow through.
I think industry’s going to have a challenge meeting the demand, but we’re all well aware of that and working on our
capability development to ensure we’ve got what we need.
ADM: In 2016 Qinetiq signed an alliance with DST Group to develop new technologies and processes. How has that relationship bedded down and what are you working on?
Barsby: QinetiqQ, or the heritage companies we acquired to establish Qinetiq, have been working with DST Group for over 20 years, so there’s a long and deep history of working together there between the organisations that we are building on. We’ve actually got three research projects underway now under the alliance, including composites delamination, certification of additively manufactured parts and the use of graphene in corrosion prevention.
ADM: During his visit in July, UK Defence Secretary Michael Fallon talked about a new level of defence cooperation and partnership between Australia and Britain. As a UK-headquartered company, will that offer opportunities for Qinetiq?
Barsby: We are keen to work through the detail on this and obviously being of UK parentage we expect we’ll find some areas that are well suited to what we’re doing.
What we’re seeing now is recognition of the requirement of industry to be a fundamental input to capability and recognition that to get the programs done that Australia has ambition to deliver, we are going to need that industry base to support those programs. And that capability needs to be drawn from all our allied sources. So we’ve already seen some capability coming in to Australia from multiple US primes and we’ll see that from UK primes as well.
There is a lot of opportunity for businesses like Qinetiq in what is coming through defence over the next few years. You can already see it, as evidenced by our growth to date. And you know, it is exciting, the amount of work that’s coming down the Defence pipeline and the technical depth that’s going to be required on some of those major programs is quite extraordinary. And we’re working very hard to ensure that we can leverage the capability, expertise and experience that’s resident within the parent business.
Fortunately Qinetiq has maintained a fairly significant investment in ongoing R&D in areas where it’s got desired technical expertise. So in a number of quite specific fields we have world class expertise resident across the business that we’re able to access and bring to bear where required.
ADM: As a services business, your people are your product. How does Qinetiq go about finding and keeping people of the calibre it requires?
Barsby: We have a strong culture and a great employee offering: we’re a significant above line employer within the Australian defence industry. I think it’s a great place to work and I know we’ve got a number of initiatives across the business to keep making it better.
These initiatives range from modernising our office space and work environments to upgrading our IT and communications infrastructure and implementing a loyalty leave scheme.
We have established a Diversity and Inclusion Committee to ensure gender pay equity within Qinetiq and to fostering an inclusive culture and enhancing the diversity of our workforce. I am a Workplace Gender Equality Agency Gender Pay Equity Ambassador.
We have also focused on giving back to the communities in which we work through initiatives such as our “volunteering days”, our support for the Australian War Memorial and this year a team of 20 Qinetiq staff are walking the Kokoda Track as part of Operation Legacy Australia Kokoda Challenge 2017. Our team had the goal of raising $100,000 for legacy and we are almost there!
It was great to be recognised by the DTC as the 2016 Employer of Choice and we are a finalist again this year. We are also a finalist in the 2017 HR awards.
I think Qinetiq is a great place to work. And we’ll keep working to make it even better.