Schedule Performance
2.19 As mentioned in Chapter 1, Defence has introduced IMR and FMR as more appropriate milestones for measuring DMO acquisition performance in contributing to the Capability Managers' FOC. The projects covered by the 2010-11 MPR have updated their MAA to include IMR and FMR milestones. The period between FMR and FOC dates indicates the time required by Capability Managers to bring together all the Fundamental Inputs to Capability elements, after the DMOs delivery of its materiel elements of capability, to achieve FOC.
2.20 As the use of IMR and FMR matures, especially for new projects that enter the MPR with defined IMR and FMR milestones, schedule data will be presented on those milestones as well as the FOC milestones (and the relationship between FMR and FOC will become clearer). While FMR is generally expected to occur ahead of FOC, during the transition to the new milestones some anomalies were noted. For example Joint Strike Fighter, Hornet Refurb and Armidales do not have defined FMR dates and the Collins R&S project anticipates the Capability Manager declaring FOC ahead of DMO realising FMR at the completion of a docking cycle one month later. While this last example may seem an aberration, it is likely that this may happen for other new platforms or multi-platform upgrade projects where finalisation of some aspects of materiel acquisitions (e.g. spares) may extend beyond FOC.
2.21 Figure 2.4 provides an indication of the estimated time required for Capability Managers to bring together all of the Fundamental Inputs to Capability following the final delivery of all key DMO deliverables.
2.22 The factors driving the lead times between FMR and FOC will be analysed over coming years. These factors are likely to include influences such as technical complexity, platform availability, acquisition methods and priorities.
Figure 2.4 - Current FMR and FOC Estimates
Notes:
1. Joint Strike Fighter has no defined FMR or FOC date. The chart shows schedule to first materiel release.
2. The Hornet Refurbishment project has not defined FMR or FOC. The chart reflects the plan to close the acquisition in late 2011.
3. The Armidale project does not have a defined FMR date as it is deemed to have already been achieved.
4. UHF SATCOM has no defined FOC date.
2.23 Schedule analysis presented in previous reports was based on achievement or expected achievement of FOC. Figure 2.5 represents the schedule performance for each of the major projects covered in this year's MPR. The chart shows the original project approval date, the originally approved FOC estimate and the forecast FOC as at 30 June 2011.
2.24 Implementation of the Kinnaird reforms in 2004 has delivered a marked improvement in schedule performance for Defence capability acquisition projects. As shown in the PDSS, average schedule variance for pre- Kinnaird MPR projects is 50 per cent, while the average variance for post- Kinnaird projects is 9 per cent. This is influenced by the ages and stages of the projects, with schedules being related to scope and complexity of each project.
2.25 The Hornet Refurbishment project was approved by the JCPAA for removal from the 2011-12 MPR program. Three other pre-Kinnaird projects should also soon be considered for removal from the MPR program. Hornet Upgrade, FFG Upgrade and Armidales are currently scheduled to achieve FOC in 2011-12 and may be recommended for removal soon after.
2.26 One post-Kinnaird project, C-17 Heavy Airlift, which in prior MPRs anticipated achievement of FOC nearly one year early, is now scheduled to achieve FOC in 2011-12, as originally forecast.
2.27 The 2009-10 MPR also anticipated the Bushmaster Vehicles project would achieve FOC for Production Period 3 (PP3) in 2011-12; however, Government has approved an additional acquisition of 101 vehicles (70 of which will be purchased under the LAND 116 Phase 3 project) and a new estimated FOC date of April 2014. Therefore, even though the Government approved and forecast dates appear to have slipped, there is no schedule variation for this project overall. The re-base-lining of the FOC date has been approved by Government. This is consistent with DMO treatment of this project in previous MPRs, although it does mask a schedule loss of 11 months for PP3.
2.28 There are seven MPR acquisition projects currently scheduled to achieve FOC during 2012-13, which will result in the capabilities transitioning into the sustainment phase of the capability life cycle at that time. Those projects are: Wedgetail; Super Hornet; ARH Tiger Helicopters; SM-2 Missile; UHF SATCOM; Stand-off Weapon and Battle Comm Sys.
Figure 2.5 - Schedule from Approval to Current FOC Estimate
Notes:
1. Joint Strike Fighter, Hornet Refurbishment and UHF SATCOM projects have no defined FOC date.
2. The FFG upgrade project did not have an FOC date at approval so the estimated Operational Release date for the last upgraded vessel is used as an equivalent.
3. Government approval of PP4 included approval of a new FOC date, which masks what would have been a variance for the project up to PP3.