| Key recommendation 13. The new Defence Board should ensure that the implementation of the Defence Reform proposals is properly resourced, coordinated from Head Office and driven by both Ministers and the senior leadership of the Department. |
| a. The Defence Secretary should chair a group specifically to oversee implementation. |
| b. Implementation should be led at 4 star level. They should be responsible to the Defence Secretary's group and the Defence Board for driving through the detailed design and implementation. They should stay in post to see it through. |
| c. Implementation should be one of the Department's top priorities and will need to be resourced accordingly. This will need to cover training for Defence as a whole, as well the core teams who will lead the work. |
| d. The Defence Reform Steering Group should be asked to reconvene on an annual basis for the next three years to check on progress, and report to the Defence Secretary, who should in turn report on progress to Parliament. |
| Key recommendation 14. The model depends on the right leadership and behaviours. The Department has failed in this regard in the past. Behaviours should be front and centre of, and embedded throughout, the implementation. The right example must be set from the top. |
14.1 This section sets out our recommendations on implementation. In this report, we have produced what we believe to be a coherent set of proposals covering the major areas of Defence. They have been designed, and need to be considered, as a package, with a carefully thought through set of checks and balances.
14.2 The model provides the top level framework for Defence and a clear direction of travel for the work that the Department will now need to conduct. We have not produced a detailed blueprint. This is deliberate. There is a limit to what an external group should or could do. The senior leadership of Defence understands the detail better, and will be the people responsible for making it work. They must now take the lead.
14.3 Any model, however good, will fail if it is not implemented well. How the proposals are implemented, and how the change is led will be crucial. It is important that this is done in a way that remains true to the intent of this report. It is also in the detailed design and implementation work that the necessary savings should be identified.
14.4 The Department's record on implementing major reforms is mixed. We have considered why change fails, both in the MOD and externally, and what is necessary for it to succeed. Our analysis is set out at Annex G. The main issues were around leadership, vested interests, culture, engagement, addressing the whole 'system' and implementation.
14.5 Building on this analysis, we have identified some conditions for success in implementation. These are also set out in Annex G. A few are worth emphasising here. Many will seem obvious, but they are no less important for that.
14.6 First, implementation needs to be owned, co-ordinated and driven from the very top. We recommend the Defence Secretary chairs an implementation group and a single 4 star is charged with overseeing implementation to achieve the co-ordination and drive. The ownership must be broader. The reform will not succeed unless the senior leadership is united behind it. That is true in most organisations, but particularly Defence. Once a decision has been made on the new model, the entire senior leadership must ensure they personally understand, sell and drive the delivery of it. If they are not able to do so, they should leave.
14.7 Secondly, the vision for reform needs to be set out clearly, and communicated persistently and consistently throughout the organisation. Staff need to be clear what the model is, what it means for them, and how they are involved. We understand the Department is considering producing a blueprint in the Autumn, which would set out what the end state should look like, and would cover not only Defence Reform recommendations but also the other major changes the Department is embarked on. We support this proposition. Setting out all the changes in one place makes them more likely to be coherent and easier to explain. It would also be an opportunity to mark clearly that it is the Department's view of the future, not just the Steering Group's. The sooner that shift is made the better.
14.8 Thirdly, implementation will need to be properly resourced throughout Defence, specifically in manpower, finance, training and leadership attention. This is not easy in the current financial situation, doubly so when freeing up the resource to invest in change will be seen as taking money from the front line. In the short-term it is; but getting the organisation to function effectively and efficiently is an important investment in the front line of the future.
14.9 Fourthly, implementation will need to be carefully planned, sequenced and managed. Change on this scale will need a central team to ensure coherence between the various parts. They should also ensure that the intent of the proposals is neither diluted nor defected. The planning will need to manage carefully the risks inevitably involved in any such change, particularly to operations and to safety. It will also need to be sequenced so that the key enablers are put in place first and to take account of the rate at which the Department's headcount reduces.
14.10 Fifthly, the hardest part of any reform such as this, is effecting the changes to behaviour necessary to reinforce the organisational and process improvements; they will need particular focus in implementation. Much of the model is designed around trying to get the right behaviours in the right places. Our work suggests that a number of behaviours are going to be particularly important in the new model: putting Defence first, being focused on outputs, prizing affordability, understanding your role and sticking to it, honesty, holding to account, valuing and sharing information and trust. But we are deliberately not making recommendations on specifically what they should be. To have any chance of success, they need to be developed and owned by the Department itself, preferably through a process of engagement and consultation with staff. Once the key behaviours have been defined, the Department will need to invest significantly in embedding them. For that to happen, people will need to be clear what they are and how they are relevant to them, see them being demonstrated actively from the top, and see any divergence from the new behaviours being tackled robustly.
14.11 We believe that implementation should start promptly and proceed at pace. We are pleased that some of our earlier proposals, on infrastructure and corporate services, have already been implemented. If these proposals are agreed, we believe that the changes to the top structure (e.g. appointing a Commander JFC designate, moving to the new 3 star
14.8 structure in Head Office) should be made quickly. This is so that the further design work is overseen by the individuals who will lead those areas into the future.
14.12 The implementation of the new financial model will clearly take longer. It will take time to put some of the enablers into place, such as the necessary skills within the Commands, the single version of the financial truth, and clear terms of delegation. Some have argued that the books must be completely balanced before the new financial model could work. Others have argued that at least the early years would need to be broadly in balance, allowing the Commands to make their own recommendations about where savings in later years might be found. Clearly the books need to be balanced irrespective of what financial model is used. We believe the Department should move in the direction of the new model as a priority, in stages as the enablers are put in place. The Department will wish to consider the speed, in consultation with HM Treasury, with an eye to the over-riding need to retain financial control.
14.13 Our final recommendation is that this Steering Group should be reassembled each year for the next three years to take stock of progress, and report on it to the Defence Secretary, who would in turn report to Parliament. The aim of this is to provide an assurance mechanism that can check that the right actions are being taken, that they are being progressed with sufficient urgency, and that they are implementing not just the specific recommendations in this report but also the broader intent of creating an organisation that is effective and efficient in delivering one of the most important roles in Government.