3.7 For several of the programmes we examined, major problems resulted from the Department and suppliers jointly underestimating the complexity of upgrading or building upon equipment that is already in service. For example:
• at the start of the programme in 2010 the programme team reported that the Spearfish torpedo upgrade was considered 'low risk' by the supplier, Defence Equipment & Support (DE&S) and subject matter experts, because the technology and the approach to integration were seen as well-established. However, this significantly underestimated the level of interdependencies with other programmes, leading to: too narrow a programme scope; use of immature cost estimates; underestimation of the complexities of securing safety accreditation; and overestimation of supplier ability to manage the technical challenges; and
• the Crowsnest radar system was developed to be fitted to the Department's existing Merlin helicopter fleet. An internal 'lessons learned' review concluded that neither the Department nor industry understood the complexities of delivering the capability. Changes to funding, scope and timetable, together with a fixed price contract, contributed to subcontractor under-performance, which the prime contractor and the Department did not detect until it was too late to meet the target delivery date.