Good evening all. This is my second opportunity to speak to a techUK audience, and it comes as I am about to leave the Armed Forces after what will be 40 years. So I thought I would use the opportunity to reflect on where we are and where we are going. In doing so, I shall touch upon Strategy and Leadership, before focussing on the role of Joint Forces Command, and on Innovation.
And for those who are well and truly fed up with it, the B word will not pass my lips!
My first observation is that the conditions we face today in the security arena are very different from those we have faced for the past 20 years or more: firstly, we are in open competition with Russia in a way that hasn’t been the case since the end of the Cold War, whilst still having to deal with non-state actors that seek to destroy our way of life.
Second, China is now a global hegemon, a fact which complicates the landscape.
And third, we are now, well and truly, into what Klaus Schwab of the World Economic Forum called the 4th Industrial Revolution, but I think is more commonly known as the Digital Age.
(Indeed, I would hazard a guess that these latter two factors, China and the Digital Age, which represent both risk and opportunity, will be the dominant ones over the course of this century, even if other things, may seem to be the wolves closest to the sled right now.)
All this amounts to a much more complex security environment than we faced between 1945 and say, 2015. And this comes at a time when any UK government’s resources will be stretched – due to general economic conditions and plenty of pressing demands not directly related to security.
Hard choices will have to be made, both between security and the other responsibilities of government, and within the security domain. And when you must make hard choices, the only tool available is Strategy. Not vision, nor policy, nor plan. Strategy.
For sure, within the security domain, and in MOD in particular, there is considerable scope for efficiency that would reduce the need to cut outputs or for more money. But I’d be surprised if our Strategy could be, or should be, to rely on efficiency alone – not least because if we are going to deliver efficiencies at scale we will need commensurate up-front investment, which, in turn, would force us into hard choices.
And Strategy demands strong leadership because few of us want to make hard choices if we can avoid them. This is equally true of the military as it is of politicians, but we have less excuse for not displaying it, both because we pride ourselves on leadership and because we do not face election.
UK Defence has managed to keep afloat in the last couple of years, not least through the good offices of our Secretary of State, Gavin Williamson, who managed to secure an extra £1.6Bn for the Defence Budget in 18/19 and 19/20. But this additional funding, welcome though it was, has not fundamentally changed the situation: it has delayed the moment of decision.
We still need to make some hard decisions in Defence and/or in Government. If not, I believe we will risk defaulting into an increasingly hollow force, without the right mix of capability that we need to respond to the situation in front of us.
So, what, you may well ask, do I think we should do? Well, I believe that there are two essential steps we must take: we need to develop the capabilities required to compete below the threshold of conflict and we must become a data-driven organisation.
I say the first of these because Defence has recognised that we are not exclusively about fighting, and that many scenarios may not end in conflict. We have to maintain the capability to fight, not least because some of the things you need to prevail in conflict are also very useful to deploy around the world to send messages of our resolve. But we must avoid becoming just an insurance premium, and an expensive one at that.
The good news for Defence is that it has much to offer in the space we are now calling “operating”, to distinguish it from “fighting”.
For example, intelligence, surveillance and reconnaissance, to understand the situation; defensive cyber to protect our networks every day; offensive cyber to deter and compete with those who seek to act against us in cyberspace and elsewhere; information operations to combat fake news in our information environment and affect decisions in our opponents’; arms control to constrain the development of illegal weaponry; and defence engagement and capacity building to reduce the risk of conflict upstream and enhance the probability of success if fighting breaks out.
All this is what makes Joint Forces Command so interesting and rewarding to be part of, because we are the lead Command in Defence for the delivery of most of these things. It will be our job, for example, to use Machine Learning to enhance our Intelligence function. Our job to make better use of Space to understand what’s happening. Our job to make our systems more resilient to cyber threats. Our job substantially to grow our offensive cyber capability, in partnership with GCHQ. Our job to develop the thinking and tools necessary for information operations. Our job to ensure that Special Forces don’t just become a one-trick pony, focussed exclusively on Counter-Terrorism.
Likewise, though we are, of course, not the only users of Information, Joint Forces Command has the lead for the Information Environment in Defence. So it’s our task to enable and integrate Defence’s response to the Digital Age, or the 4th Industrial Revolution.
The Owner of the Digital and IT function, Charlie Forte, the Defence CIO, sits in Joint Forces Command, as does Defence’s main IT delivery organisation, Information Systems and Services. Although, de facto, a Digital and IT Function has always existed in Defence, it has not really done so in any formal sense, at least not on an enterprise-wide basis.
So Charlie, whose hiring was really the first step in this, is now in the process of defining the Function, and setting its trajectory. This will not be the work of an instant, because it has all kinds of potential ramifications, including processes, assurance, boundary issues, reporting chains, incentivisation, training and accreditation, etc etc etc. But at least we are underway.
Becoming a data-driven enterprise is essential if we are to be competitive in the future. Our data needs to be an asset, not effluent. We must understand what data we have, establish what data we need, and determine how to address the delta. It follows that we must have better rules about the ownership and handling of data, and better behaviours. This too will be far from simple: for example, I suspect we will need to be Stalinist about the ownership of data if we are to be properly organised about this, but we will also need to be democratic as to the use of data if we are to be agile.
We also need to pursue Innovation, which potentially allows us to break the zero-sum game of either needing more money or to reduce our ambition. I think last time I spoke to this audience we were just setting off on this journey in Joint Forces Command. So, it’s a pleasure to be able to report that it has succeeded beyond our expectations.
In our Joint Forces Command’s Strategy, published in January 2017, we established a Guiding Principle. This was that:
Through Innovation, Integration and Information we would deliver Advantage for the Joint Force.
So, you can see that Innovation is a critical mechanism in the Command, at the heart of what we are doing.
After much research in the summer and autumn of 2016, the delivery model we adopted came from a 2014 article in Harvard Business Review, by Scott Anthony and others.
In addition to being an author and commentator, and the winner of the 2017 Thinkers50 Distinguished Achievement Award for his work in the field of innovation, Scott is a Senior Partner at the innovation consultancy, Innosight, which has Clayton Christensen, as one of its co-founders. Clayton, as I am sure that most of you will know, is a Harvard Business School Professor and one of the most important thinkers on innovation today.
In that HBR article, Scott describe how to build an Innovation Engine in 90 days, which he called a Minimum Viable Innovation System. I don’t think he had the public sector in mind when he advocated this, but I bought into his ideas and applied them in Joint Forces Command.
It took us a bit longer than 90 days, but, well within a year, we had established a unit that was delivering capability into the hands of users. We did this by starting small, piloting everything, and learning as we went, as much from our failures as our successes.
Crucially, when we are measuring whether we have delivered Innovation, the question we ask ourselves is have we delivered new capability or functionality into the hands of users, at pace? If we haven’t done this, we haven’t innovated.
The innovation unit we established, in a WeWork building close to Tech City in Aldgate, known as the jHub, is now delivering capability into the hands of the users, with contracts signed, in an average of 10 months. This compares well with the closest benchmark we can currently find in Defence, which takes 17 months on average to meet the most Urgent Capability Requirements.
And perhaps even more interestingly, the jHub is taking an average of 9 weeks to get to things into Pilot. This is hugely positive because it means that Users are engaged in delivery far earlier than is the norm in Defence. They can then influence what capability is delivered, become advocates for the change, and can be getting operational value much earlier in the acquisition process.
So successful has this experiment been that we have opened a second franchise of the model, the MedHub, later this month, and are planning on opening at least two more franchises in Joint Forces Command this year.
At the heart of our Innovation Ecosystem is its Charter, which defines the principles under which it will operate. Perhaps the most important point in the Charter is about Governance, or Leadership. It is essential that Innovation has Champions, the more senior in an organisation the better – because the existing business will seek to kill innovation, not for malign reasons, but rather because it threatens the status quo in which people in the existing business are heavily invested.
In turn, what this means is that big organisations seeking to be innovative must be ambidextrous, if they are to avoid the trap that the economist Joseph Schumpeter spoke of when he said that “in general, it is not the owners of stage coaches who build railways”. Large organisations need to be able to continue to deliver a large part of their existing business, at the same time as nurturing innovation.
Risk appetite is also fundamental, especially in a public-sector body. It is an unsophisticated attempt to guarantee success in everything we do that drives cost and time into our programmes. Paradoxically, it also induces risk, not least in delaying the delivery of capability and the opportunity cost of programmes more expensive than they need to be.
Absent a much higher risk appetite in the innovation part of our business, failure to innovate is a certainty. We take a portfolio approach in Joint Forces Command: we have a low appetite for the risk that our whole portfolio fails, and a high appetite for the risk of any individual project failing.
This risk appetite then drives, amongst other things, our approach to competition. We are in a competition for ideas. If you pitch us an opportunity and then demonstrate you can deliver it, we will not steal your idea and then compete it. This is a vital promise for Tech start-ups: without it they wouldn’t come within a country mile of us. Small Tech start-ups currently comprise over 80% of our suppliers, but I’m hopeful that the traditional Defence industry will increasingly get into this space, and not just by swallowing start-ups!
Another crucial feature of our risk appetite is that it enables empowerment and diversity. Nay, it demands it. This is perhaps the most striking feature of our ecosystem design. We have very flat structures and highly delegated authorities, and our innovation engine is populated by young people, of all ranks, full of energy and enthusiasm, and not yet prisoners of the way things are done around here. I have been amazed at their ambition and determination, once given the right to roam.
Our approach to risk also makes us opportunity-driven rather than requirement-driven. Having been in the MOD equipment acquisition business for a lot of my career, as programmer, requirement-setter, delivery agent, in-service fleet manager, and user, I have reached the conclusion that agility and requirement-driven processes do not go hand in hand. Requirement-driven processes have a high propensity to lead to life-cycle replacement, especially given how hard it is to move manpower in Defence. But if you do what you’ve always done, you’ll get what you’ve always got. The jHub is not about accelerated procurement of existing requirements. It is delivering things the User didn’t even know they wanted, but is now really grateful for!
We call the network of our innovation franchises and other partners, the MilTech Network – because the solutions we are pursuing are based upon the digital disciplines of artificial intelligence and machine learning, data analytics and visualisation, modelling and simulation, quantum, blockchain, and modern behavioural science. Like everyone else, we have noticed that these disciplines are beginning to have a huge impact in the private sector, and it is not obvious to us why they should not have equal effect in Defence. So MilTech seems to us an excellent way to focus our Innovation.
If this agenda sounds like there is a lot for us to do in Joint Forces Command, that’s because there is! But I am sure that there are people in this audience who can help my successor, Patrick Sanders, and his team, on this journey. I shall be watching with interest!
I’m a great fan of the Margaret Mead quote:
“Never doubt that a small group of thoughtful, committed, citizens can change the world. Indeed, it is the only thing that ever has”. We may not change the world, but we are going to change UK Defence.