LONDON — Sir Bernard Gray’s nearly five-year run as the head of Britain’s Defence Equipment & Support (DE&S) organiszation ended Nov. 30 with him handing as he handed over the reins of the operation to his successor, Tony Douglas.

The author of a scathing 2009 report on the shortcomings of a DE&S that which regularly failed to control program budgets and schedules, Gray was talked into implementing the reforms he recommended by the Conservative-led coalition government in 2011.

Gray leaves DE&S in a much better place than he found it. But it’s been an often difficult journey. His abrupt management style ruffled a lot of people, and a controversial plan to turn DE&S into a government-owned contractor-operated (GO-CO) body failed when one of the two bidders withdrew at the last minute.

Instead, the transformation effort focused on a DE&S revamped as a government trading entity with greater freedoms to act independently of the civil service on issues like employee pay.

Industry has found a place at the DE&S table, though. Bechtel, CH2M Hill and PwC have all secured managed service-provider contracts to teach staff the skills required to hopefully make redundant a government threat to look again at the GOCO option at a later date.

Q. As a consultant, you wrote a scathing report for the government of the day on the problems at DE&S. Viewed from the inside, were those criticisms justified?

A. The situation was much as I thought it would be. Looking back, though, I am more sympathetic to the situation they faced. People had to live with the chaos caused by a budget that was badly overprogrammed. Every year, pretty well everybody was having to reschedule their programs. The lack of stability and the inability to hold industry to account for their performance when they were having to constantly change delivery schedules, when you were constantly changing cash flows, it made life almost impossible for people in DE&S. We have been fortunate since 2010 to have a stable budget and a stable set of requirements. That's the biggest single thing that has made our job much more doable.

Q. What's your take on the progress DE&S has made in the last five years?

A. We have rediscovered a sense of ourselves as people who are able to negotiate and manage programs. We were in a situation where if people in DE&S wanted to do the right thing prior to 2010, sometimes they were overruled because someone in industry would go to higher levels of government and say, "DE&S is being beastly,." aAs a result we would effectively get pushed not to rock the boat,. tThat led to people being a bit cowed. Now we have rediscovered our ability to negotiate where it’s not us being dominant or industry being dominant, but we get a sensible grown-up agreement which puts risk in a more appropriate place. People in DE&S now also recognisze there are tools and techniques out in the world we haven’t been using, and they are keen to get their hands on techniques like work breakdown structures and program control tools. Those are beginning to go in and people are starting to see the value of them. 

Q. The announcement of your recent knighthood pointed up your success in transforming the fortunes of DE&S. So why do you think you didn't get the nod from government to stay on when your tenure in office came up for renewal last year?

A. I did get asked to stay on for another year. I think they wanted somebody who would follow it through for another five years. As i look back on it I actually think it's a good thing that it’s not overpersonaliszed into one individual. The reform program gets carried through by a team of people which has a mixed leadership over time; I think that’s stronger than it being a Bernard Gray thing. It’s more likely to endure.  

Q. Despite the progress, media reports suggests that the Chancellor [George Osborne] doesn't have sufficient confidence in the MoD to run the Successor nuclear deterrent submarine program and wants to set up a new body under his control.

A. I don’t think you can generalisze. The Successor program exposes us to the most complex risks and huge financial exposure. To that extent I think it is legitimate for the government to consider the best way to deliver that. I don’t think anybody should get emotionally wrapped up in the issue. The government has to make the right choice about how to deliver it. One way or another we have to tool up to do that. I have been working for the last three years trying to strengthen industry and the MoD to be able to handle this thing going from a conceptual design into a production reality. The government will have to decide how it wants to embody that.

Q. Is the final nail now in the GOCO coffin?

A. What we have is a route forward for the next two years at least. I keep trying to get people to focus on their day job and not worry about things that might happen down the line. Those people who don't want it to be a GOCO have the job of making DE&S so brilliant that the people in authority at the time will say, "Why do we need to make it anything else?"

Q. The Mmanaged Sservice Pproviders have been in place for a year. What's the experience so far?

A. I think they would confess it’s more complicated than they thought it would be when they started. More diverse in the range of challenges, more complicated in the number of stakeholders we have to engage with and so forth. It took them a while to calibrate that. But since March we have pulled together a substantial action plan with 43 separate projects, which is now being executed. All the current management team have bought into it, and Tony Douglas has had exposure to it. It’s not my plan — I have deliberately made sure it’s the management who are going to stay who own it, but I do think it’s a good plan. 

Q. DE&S needed decisive leadership, but one of the things you have been accused of is having a management style which damaged morale. In hindsight, would you have done things differently?

A. I don’t think the data supports your premise. Surveys over time don’t say that. Nor do the staff turnover stats; we haven’t had droves of people leaving the organiszation and I would say the senior management staff structure has been more stable over the last five years than it had been previously, and these are the people I do business with most of the time. There is no doubt that quite a lot of people were determined to do things their own way and were determined not to listen, and that led to some significant arguments from time to time. The point is we have ended up in a much better place. 

Q. One executive I spoke to said it wasn't the message but the way you delivered it that was the problem.

A. My point is that nobody else had delivered change at all. I get that it’s easy to sit around a table and all agree with each other and let things slide, but you show beme where significant change happens in an organiszation where people like you when it’s happening. I take issue over anonymous armchair commentators who sit there having not done something who then bitch about people who have. I don’t agree if you tell me that morale is worse than when people had no control over what was happening to a situation where they have stability and they know what they are trying to do. Did I push people for better performance? Yes, but that’s the coache's job.

Q. Finally, What would you like your DE&S legacy to be?

A. I hope it will be a stable program being delivered by an empowered workforce who know what they are about and have the freedom to get on and do it.


Andrew Chuter is the United Kingdom correspondent for Defense News.

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