3.17 In 2018, the Department established a Strategic Partnering Programme (SPP) to maximise commercial leverage with its 19 most important suppliers by improving contract performance and managing strategic risks. BAE Systems is furthest into the programme. The Department and BAE Systems have jointly identified shared shortcomings in programme scheduling, pace of delivery and approval timescales, and in aligning objectives and incentives. The parties are working together on a number of workstreams intended to improve the performance of an identified programme or thematic area, for example, looking at the international supply chain feeding into the Type 26 frigate programme.
3.18 In doing this, the Department is applying well established good-practice principles, such as the need for transparency between customer and supplier, and enablers such as co-location of staff and shared access to data. These principles were incorporated in a 'gold standard' of how to manage the complex cultural and systemic drivers of defence programme performance developed by the National Audit Office in 2005.26
3.19 The challenge for the Department will be to ensure the programme has the capability and capacity to deliver the SPP across all 19 strategic suppliers, and to consider how the programme manages changes arising from the Integrated Review of Security, Defence, Development and Foreign Policy and the Defence and Security Industrial Strategy. To ensure widespread support for the approach, the Department will also need to develop a process to clearly track and communicate the benefits such as financial savings, schedule improvements, risks and equipment availability. It estimates that its SPP could deliver benefits exclusively attributable to this programme of £160 million over the next 10 years. In order to have a significant effect on the issues identified in this report, the SPP must deliver successful interventions across the range of strategic suppliers.
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26 Comptroller and Auditor General, Driving the Successful Delivery of Major Defence Projects: Effective Project Control is a Key Factor in Successful Projects, Session 2005-06, HC 30, National Audit Office, May 2005.