Naval Group is leading the design and build of the largest and most expensive Defence acquisition in Australia’s history – the $50 billion Future Submarine Program. ADM Managing Editor Katherine Ziesing caught up with local CEO John Davis to run through how the program is progressing and what lies ahead.
ADM: Now that the SPA (Strategic Partnering Agreement) has been signed, what are the next steps for both the Australian and French parts of the business? What tangibles can you point to for industry partners?
Davis: The next step is the Submarine Design Contract (SDC), which is the first contract work scope to be fully executed under the Strategic Partnering Agreement (SPA). We’ve moved from SPA to the SDC very quickly; we actually commenced on 1 March.
The SDC marks a major transition from the design mobilisation contract. The scope for this phase of work includes the ongoing maturation of the Attack Class design as it progresses into the next design phase known as the Definition phase and establishing Naval Group Australia to the point now where we’re really prosecuting the design proper.
As we start to progress through the SDC we’ll be opening up more and more work fronts. We will commence sourcing over 100 critical and main equipment categories that will contribute to the submarine design solution, which is a significant step forward. This will mark significant opportunity for Australian industry. We’ve talked a lot to industry about the Future Submarine procurement process but now it’s underway in earnest.
We’re also well underway obviously with the critical systems or the “Top 5” pieces of equipment:
- main electric motor
- main DC switchboards
- main storage batteries
- weapons discharge systems
- diesel generators.
At the end of April we have issued over 2,700 requests for information to industry involving over 1,100 companies, and of that 1,100 only 46 were overseas suppliers. So the ramp up in procurement is incredibly quick and despite all the contra views, is very much focused on Australian industry.
More than 1,200 companies have registered interest in our work packages through ICN Gateway, which is going well, and more than 1,400 companies have attended industry briefings on the Attack class. This demonstrates the ongoing strong interest that industry has, in being part of such an exciting program.
We’re also up and running with the shipyard. The first sod was turned at the shipyard site in December 2018 and we have concluded the early design activities for the initial facility. We’re going through the final rounds of infrastructure functional requirements and we’ll deliver an update to ANI (Australian National Infrastructure, formerly part of ASC) and then ANI will work with its managing contractor, Laing O’Rourke, to finalise the design. This will open up another work front to start the build process for the shipyard facilities at Osborne.
The construction of the substantive parts of the shipyard will commence in 2020 and that will progress out, in stages and will run over a number of concurrent years, to about 2023.
As part of the SDC we transferred a whole swathe of work scope from France to Australia. The procurement activity for the whole of the program is now being run from Australia by Naval Group Australia.
Naval Group Australian engineers have moved to France to work and learn side-by-side with their French counterparts. They will undertake specific submarine design training to develop an intimate understanding of the know-how and know-why for the Future Submarines. We’ve just sent another 17 people to France and we’ll send just under 20 in the new year, another fairly significant step up. It’s no longer about mobilisation, this is true program execution.
ADM: To be very clear, there is Naval Group money leaving the door to Australian industry right now?
ADM: You mentioned the workforce issue. What is the profile of the workforce that you will need between Australia and France over the coming years?
Davis: At the moment for the main design activities, about 500 people are working on the program in France and about 100 in Australia. Naval Group Australia will double in size this calendar year and will continue to double in size over the short term and then we’ll get onto a progressive climb from there. In terms of the core work, you’ll see more and more of it being prosecuted in Australia.
ADM: What skill sets are you looking for in the short term as you ramp up?
Davis: Procurement, program management, construction of the yard, design engineers, technologists, the usual program management support activities. But our main thrusts are really in procurement and engineering.
ADM: How does the relationship with Lockheed Martin as the Combat Systems Integrator (CSI) work in a practical day-to-day sense? What role will they play as part of the design authority and as the program comes together?
Davis: Well I guess there’s two parts to that. There’s the formal part, which is enshrined in contract and then there’s the practical part of it. Within the framework between Lockheed Martin Australia, the Commonwealth, and ourselves, there are formal agreements in place which define the work and how we work together and indeed the responsibilities of each of the parties within that framework. It’s pretty well codified.
Practically, we have dedicated teams supporting combat system activities both within the CSI organisation and within the prime systems integration organisation. Those two teams work very closely and collaboratively together. Both Lockheed Martin and Naval Group are very experienced practitioners in this field. Naval Group designs and builds submarines, and Lockheed Martin as a CSI has a wealth of experience, principally drawn from the US but further afield as well.
When it comes to talking about the design authority the CSI will have its own design delegations within the CSI framework as well, and then across the teams we will work together to provide the integrated design authority for the whole platform, and that’s fairly standard; I don’t think there’s any surprises to that.
That was how it was always envisaged and that’s how it’s working. Ultimately what it means for Naval Group Australia is that we will operate a platform design authority team which is going to be at least 100 strong, which will have the necessary delegations to support the detailed design and build activity for the submarine.
ADM: The program of reference is the Barracuda program in France. Can you give us an update as to how that is going?
Davis: The first of class Barracuda, the Suffren, was launched on 12 July and has commenced systems commissioning and trials activities. In terms of the timing of that program, it pretty well runs ideal for Australia. We’re picking up the lessons learnt from the design and build and that’s given us the opportunity, one, to ensure we understand the inherent risks we may have within Future Submarine for those pieces from Barracuda, and two, it gives us another contemporary frame of reference for cost and schedule considerations.
So for example, looking at things like procurement activities, we know what market prices are for equipment and that means in terms of our forecasting for the Commonwealth, we can be more accurate.
ADM: Suffren suffered a three-year delay; those lessons learned will be applied to Future Submarine?
Davis: Yes, though some of the issues around Suffren were associated with the nuclear component of the submarine. There are some lessons which we can draw from this program but not necessarily all, because not all of them are relevant to the Australian program.
ADM: Given the raft of maritime programs that Australia has on the horizon, do you think we’re setting up the environment to have the skills and the people that we need to meet that demand?
Davis: That’s a very broad question. What I’d say is when you have a look at the overall numbers which are forecast to be required within a shipbuilding enterprise, it’s over 5,000 plus supply chain and sustainment which will probably be double that. That environment will also see growth in adjacent markets as well.
And what’s quite interesting now, when you look at oil and gas and mining, many of the skills which they’re seeking are the same skills which we would traditionally draw from for shipbuilding and engineering. The mining industry, for example, are now requiring system engineers, which if you go back 10 years ago was a rarity but now it’s quite common for them to require those skills.
When you have a look at the workforce numbers required and the capacity within the market, I think it would be churlish to say that workforce isn’t going to be a challenge across the naval shipbuilding enterprise. I think everybody understands that.
But what is that challenge? For me there’s two parts to it. There’s having the skills and there’s having the right experience. And there are two parts to this as well. There is establishing the initial team to start the work and then the sustainment of that team.
The Naval Shipbuilding Enterprise Primes have been working together now for over 12 months looking at the workforce demand and supply across the shipbuilding enterprise. At this stage we’ve got a really good understanding of the workforce demand.
There’s work ongoing now is analysing the demand data to see how and where that demand could potentially be met from Australia and to identify any gaps. Early indications are that there are areas where there are some quite significant gaps. The next body of work will look at the workforce pipeline design solution that will these fill gaps and then we will implement that solution to deliver the skills and experience to the enterprise in the right timeframe.
In practice there’s a short term challenge and a long term challenge to meeting the demand. The short term challenge is probably the most concerning because when you have a look at the numbers at the moment, I think it’s fair to say that Australia does not currently have all of the skills and experience it’s going to require to meet these program needs. So there’s got to be more work done to deal with the short term problem.
In the longer term it’s really a question about the pipeline and making sure it is fat enough in order to bring the volume
of skills and experience through. There’s already a lot of work going on all the way from schools, all the way through the higher education system to get that in place.
ADM: How do you engage with various organisation at those different points to make sure that pipeline is fit for purpose?
Davis: We have the Naval Shipbuilding College (NSC) – it’s the conduit by which industry can bring all the components to the table and they can be integrated so we can get a holistic view. But in terms of the demand, the shipbuilding primes have collaborated to define their requirements using a common taxonomy, the way in which we describe these different skills. This allows the workforce demand data to be integrated to build a complete picture.
In terms of the training materials, we’re also sharing our IP to say ‘For us an underwater basket weaver looks like this and has these competencies’, and comparing that with frigate builder BAE Systems Australia. We’re also bringing forward our own corporate training needs analysis and putting that into the pool to work out what good looks like.
Taken as a whole, there’s a real marked change in the level of industrial collaboration which is occurring to resolve the skills problem, without Defence prompting, that’s really what we have been doing as industry to help drive towards a system solution.
The challenge in terms of doing the design and the delivery of that system is one of the key roles for NSC. Industry sits on the NSC governance board and we help direct the flow of priorities and actions which are passed to NSC for them to go and prosecute.
As an aside, when you have a look at what has been achieved through industrial collaboration on workforce, there is opportunity to get that same sort of paradigm in other areas of the enterprise as well, but for workforce it’s growing I think quite well.
With respect to workforce experience, Naval Group has a frame of reference which suggests that typically for program
success you need about 30 per cent of the workforce to have the requisite experience to drive the program and deliver outcomes, and that’s quite a large number.
The work we’re doing now is looking at how do we grow that experience pool in Australia, noting that the last Collins finished in 2001. It’s been a long time since we built a submarine in Australia.
ADM: Is there an agreement not to poach from ASC to make sure that Collins can retain its capability while we go through that transition between classes?
Davis: For the Collins sustainment, we’ve agreed with ASC that we won’t draw resources from there. Now obviously there will be times when people choose to leave but we don’t actively seek to recruit from ASC.
ADM: As part of Collins LOTE discussions, is there scope for the LOTE to act as a test bed for Future Submarine? Is that actively being worked?
Davis: Yes. We signed a framework agreement with ASC in March which has several core pillars, ranging from the tactical through to strategic levels. At a tactical level we’re working with ASC to look at ways to build the health and safety culture within a new submarine construction yard. ASC have been through a very long journey to get there and they’ve got there; they have a great yard now.
At the strategic level we’re looking more broadly at how we can collaborate with ASC and what that means.
ADM: There’s been talk, particularly at the Submarine Institute of Australia (SIA) conferences about the transition between the Oberon and Collins class that it was a one-way door. You went from Oberons to Collins and you never came back. Do you see that changing between Collins and Future Submarine? Will there be a two-way door, for people and technology?
Davis: Absolutely. I think it’s really important when you have a look at the submarine enterprise and move away from the program level discussion and you look at the submarine capability. For us, it’s really important we attract people into the enterprise and retain them. Between ourselves and ASC, we’re investing a lot in the workforce at ASC for Collins sustainment, Collins LOTE and Future Submarine.
It would be churlish for us to set up a framework where we’re creating an environment where we don’t have mobility within the workforce and as a consequence of that, drive enthusiastic people into other programs where there are mobility options.
ADM: And what about that mobility of technology between the two platforms?
Davis: Yes certainly. There are obviously some restrictions on technology in terms of what can be seen by whom, but putting that aside, absolutely there are opportunities. For the Attack program, we’re into a procurement process which has got to be fair and equitable for industry as a whole within Australia.
We don’t want to just allocate work to ASC for example, we’ll have to compete it and we’ll have to look at the work which represents best value for money.
ADM: What roles do you see manned and unmanned technologies playing in the Future Submarine space?
Davis: At the threat of being called a heretic, I personally don't agree with much of the conversation saying that suddenly the ocean is going to be transparent and the day of manned submarines has gone. I’ll start by evidencing the fact that three first world navies are currently building ballistic submarines for their strategic deterrent. They wouldn’t be doing that if they thought their nuclear capabilities were under constant threat with this transparent ocean.
What I will say though is that there has been, and there is a fundamental change occurring in terms of availability of technology, processing and computing power, and that works in favour of both the aggressor and the defender.
If Australia was to seek to project force in the littoral waters, we are likely to run into more sophisticated and more capable networks and sensors, etc, which makes the probability of detection greater.
In that sense, I think for manned submarines you’ll see a change in the missions that they will ultimately perform in the future. For littoral, high threat detection missions I think you will likely see more unmanned underwater vehicles (UUVs) being used and there’s a number of advantages to that. The technologies there; they can do remote sensing, they can do weapons deployment.
On the flipside, in defensive missions, the manned submarine now is more likely to have a greater level of integration and cooperation with fixed and deployable sensors and effectors, including unmanned vehicles. You’ll likely see the manned submarine being part of an integrated force arrangement.
I think submarines are going to persist although there are absolutely a lot of non-acoustic detection techniques which improve the ability to detect submarines. But the manned submarine will persist, particularly in blue water environments and it’s likely to be bigger, it’s likely to have more integration with UUVs and be more network-centric warfare capable with the support of UUVs. I think therefore that the notion that submarines are gone in 2035 or even 2050 is probably misguided.
ADM: Rear Admiral Greg Sammut has been often quoted saying the first submarine is going to be quite different to the last submarine because you’re looking at two and a half decades between the first and last one coming off the line. What do you think are the logical technology insertion points?
Davis: You really need to have a line between the technology maturity and the point of insertion into the boat program. So it depends how the boats are batched, that’s really the critical thing and there isn’t a clear position on this at this time.
This article first appeared in the August 2019 edition of ADM.