Defence resourcing done right

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When it comes to major projects in Australia, it’s a bit of a two-horse race.

On the one hand, Defence has a massive forward program of work that will represent up to two per cent of GDP. On the other, infrastructure initiatives from roads to rail and ports are a huge focus. 

Here in Victoria, the State Government’s ‘Big Build’ program has billions of dollards worth of major road and rail initiatives in the pipeline. Defence has base upgrades and other major programs planned and in progress, including redevelopment works at HMAS Cerberus, Victoria Barracks, Point Cook, Puckapunyal, and Fishermans Bend. 

Projects like this are a sign of progress. They create jobs and inject billions into the economy. They make our country stronger, safer, more connected and competitive. The more of them the better, right?  

The construction industry is by its very nature cyclical. Sectors come on and off the boil all the time. But with defence and infrastructure both running hot, we are starting to see pressure (and competition) for suitably qualified and experienced resources between them. 

Based on our team’s experience delivering Defence initiatives from base upgrades to systems and capability infrastructure, here are some of the strategies that we use to help Defence secure industry resources and keep budgets in check as projects move from scoping to design, construction, and completion. 

Look beyond the base

Knowing what other projects are going on locally is a vital step to take in planning upcoming works, especially given the unique governance and security clearance requirements associated with Defence work. It’s often a limited field.  

When there’s lots of other work on, OFSC Accreditation, code compliance and other requirements can thin out the ranks of suitably qualified consultants and contractors considerably. 

On a national level, we have seen costs trending upwards across Defence work, sometimes in excess of 15 per cent. This is driven largely by the high demand for industry resources.  

A portfolio approach to programming can help with this. For example, could commencement of works be aligned with the anticipated ramp down of a major transport initiative, meaning there are more resources are in market? 

Capture value through smart contracts

Engagement of subcontractors in the planning phase through integrated Managing Contractor or Head Contractor contracts allows them to provide pricing and design advice early. This can give Defence and its partners valuable insight into downstream cost and value opportunities.  

Subbies provide first-hand knowledge and experience. They understand supply chains and can help you explore opportunities for innovation and savings through prefabrication and modular construction. They are your best bet for sourcing alternative products and solutions in a heated market. 

By capitalising on the opportunities that exist within contracts to consult below Tier 1, Defence project owners and managers can identify risks and opportunities early and put strategies in place to mitigate, manage or exploit them.  

Know what lies beneath

While it’s never going to be possible to anticipate every cost on a project, understanding blow-out risk areas is good practice. Many Defence estate assets are more than a century old, and while this is not a problem of itself, with age comes a certain degree of cost and time uncertainty.

What condition are underground services in? Are they where we think they are? Will cultural heritage considerations require more time or cost to manage? Are buildings structurally adequate for further serviceable life? How good are foundations and footings? What can we be doing now to futureproof them for the next century?

Where feasible, investing in early technical investigations that provide greater certainty about site conditions, challenges and constraints can represent massive downstream savings through avoidance of delays and reduction in the additional resources required for problem-solving mid-program.

Make space for success

Site access and security are vital concerns on Defence projects for obvious reasons, and they’re also pain points for contractors. While not always feasible, it’s certainly worth the time to explore whether construction zones can be segregated from active base operations and dedicated access points provided.

Separating construction from active base operations enhances security and safety, minimises risk and in many cases can reduce cost and time. Just as importantly, separation can simplify security clearance complexity for contractors, subbies, suppliers, consultants and visitors, and can minimise the impact of works on Defence capability.  

While finite industry resources can pose a risk to successful delivery, simple planning and management measures can protect Defence projects from scope-creep and budgetary woes. As Australia’s defence and infrastructure sectors continue to boom, it will be interesting to see what other strategies our program managers come up with to help Defence to resource right.