Fujitsu's Eric Bownes discusses the future of defence logistics

The nature of warfare and how militaries prepare for it – along with their other strategic objectives, which include civil emergencies, assisting in humanitarian disaster relief, and protecting the UK’s energy and food security supply chain – has changed drastically over the last decade.

The drawdown from Afghanistan in 2014 marked a watershed in defence logistics as operations transitioned from being on a war footing to its return to contingency. The focus for military logisticians is now less on moving large volumes of equipment, such as vehicles, artillery, food, and fuel, across thousands of miles from source to base; the focus is now on expeditionary operations, being prepared to rapidly deploy smaller troop numbers and supplies to a wider range of theatres.

Ahead of the Defence Logistics conference in London (23 - 25 February, 2016), Defence IQ spoke to Eric Bownes, the lead for strategy and solutions at Fujitsu Global Defence, about the future of logistics and how the transformation of IT systems will impact the market over the next ten years. Mr Bownes was a military logistician with the South African Air Force and has previously worked on the implementation of the RAF’s logistic information system.

Here’s the interview…

Defence IQ: What are the main challenges facing logistics experts over the next 5-10 years? How might these be tackled?

Eric Bownes: My view is that the challenges facing logistics experts over the next five to ten years centre on the provision of the single version of the supply chain performance. As the pace of change is speeding up and militaries are looking at more agile operations – seen with the new Strike Brigades that were announced in the UK’s recent Strategic Defence and Security Review (SDSR) – it’s all about being able to supply the single version of the supply chain performance.

I think the way this needs to be tackled is by finding and establishing a sensible balance in MoD contracts by laying out the performance levels they require and what that means for the return on investment (ROI) for the suppliers. Finding the right balance for performance-based logistics contracts between what an MoD wants and what suppliers can provide is a significant challenge going forward. Understanding each other’s return on investment is the key.

How relevant do you think logistics innovations and experiences from the last decade of operations are to the future? Is technology changing too fast or can we still apply these lessons learnt?

Militaries that have been on operations over the last decade have realised that they really need to know where their assets are and what state their assets are in. They have been implementing performance-based logistics contacts to support these operations, so it’s all about knowing the state of logistics and understanding the information of what should be sent out at the right time. There have been technological innovations – you’ll find there have been improvements in tracking and tracing, the implementation of bar-coding, and with RFID programmes – but I don’t think technology has been changing too fast to support this change. I think it has been apparent that MoDs worldwide are very slow to adopt innovative technologies that will help them with their track and trace requirements and provide visibility of where there assets are. In many cases they are not using modern technologies so they still have data inaccuracies and master data management issues that causes a lack of visibility. When a customer has an asset under different or multiple denominations caused by this lack of visibility it often leads to over or under supply of equipment.

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Are MoDs getting better at this? Are they getting smarter at using new technologies or is it still a slow learning process?

It is still slow because I don’t think defence ministries ever want to be on the bleeding edge of technology – although they would like to be on the leading edge of technology. There’s a big difference. Once they see a technology has been demonstrated as being reliable, and especially if it has been proven in both the commercial world and in defence, then the uptake gets quicker, but otherwise governments are reluctant.

However, it all comes down to money because logistics will always be a secondary consideration for innovation. Things like command and control and intelligence are usually a higher priority compared to logistics when budgets for ICT are being allocated. But governments and militaries are picking up on this more now because there has been a pressing need to reduce inventories and ensure that the right equipment is available at the right time.

The stockpiling of assets like we saw during the Cold War does not wash anymore. So militaries are starting to get smarter – they have to – with solutions that help them identify and manage their inventories.

How is the new approach to rapid deployability – as seen in the UK’s Strategic Defence and Security Review (SDSR) with the formation of new "Strike Brigades" – likely to affect logistics in the mid-term? What changes, if any, will this more agile approach to operations herald?

Rapid deployability is absolutely the right approach for today’s world of contingency operations. However, the problem is that from a logistics point of view you can have rapidly deployable "Strike Brigades" but they will need to be able to go into any environment, whether that’s the desert or snow. From a training point of view that’s a huge task. As a result, these new strike forces will need to be not only trained to operate in all environments but they will also require the logistical support that allows them to be multi-dimensional. We will need ‘logistic packs’ ready so that at any given time or for any given environment they will be ready to go.

Understanding what you need logistically for contingency operations can be planned for but the critical – and difficult – thing is being able to maintain the supply chain for the duration of deployment. So, although you’ve got these logistic packs ready to go, which requires a sizable upfront investment, you need to ensure you rotate the stock with a shelf life into normal operations and training as well so that you don’t over-inflate inventories with perishable stock. The packs will need to be ready to go at a moments notice and you will only know how much you need at the point of deployment, so the logistic effort behind that is significant.

Where do we currently stand in terms of being able to support the formation of these Strike Brigades? The are scheduled to deploy in 2020 – thinking about the logistics efforts and structure that needs to be in place for this to happen are we on track?

I can tell you that in recent discussions with the Commander of the Joint Forces, General Sir Richard Barrons, and other leading logistics officers such as General Angus Fay, they are seriously looking at this question and are working with the defence industry to make sure that the right support and required innovation for these Strike Brigades is in place. The focus is on making the new system agile and flexible, trying to provide the MoD with as much automation as possible but without taking the relevant command structure out of the loop – it’s a balance between automation and oversight.

How important is multi-national, inter-agency collaboration in logistics? Can you tell us a little more about what Fujitsu is doing in this area to facilitate standardised solutions? What is the Global Defence Initiative and how it is benefitting your work in defence logistics?

Multi-national, inter-agency collaboration on logistics across coalition operations is of the upmost importance. As a result the UK and allies like the US and NATO are standardising the systems they are using. But as we move towards performance-based logistics, data requirements are becoming more and more important; that’s ensuring that usage and feedback of both the equipment manufacturer and the customer is provided back to the supplier. It’s important to keep that information loop going in a controlled fashion so that the equipment manufacturers know what is coming back for repair. It’s all about data and systems integration. For coalition operations this is definitely something that needs to be – and is being – thought about by all the different organisations across the globe. Ensuring we have the peripherals around those systems to make data access smarter, as well as ensuring everyone is working with the correct master data management, is absolutely key. We’re working towards the interoperability of all those systems in all those agencies and improving the feedback from end-to-end logistics capabilities.

Fujitsu’s Global Defence Initiative (GDI) was formed four years ago. The UK has the biggest defence business in Fujitsu, followed by Japan and Australia, and the idea behind GDI was to bring together the best-of-breed capabilities offered by the separate units and put together a catalogue of solutions and global offerings. This allows us to work with our customers around the world and help standardise command and control, intelligence, cyber security and logistics capabilities between allies and coalitions. In 2014 we acquired a US company to expand our presence in that market, so our defence business globally is growing. We’re also gaining traction in places like Finland, Turkey, Italy, France and Germany, selling our standardised solutions to their MoDs and contractors.

Although Fujitsu doesn’t advertise itself as a defence supplier as such, we do a lot of work in this market and would be in the top 100 of defence suppliers globally. Our strategic intent is to double our revenues within the next five years.

What about the transformation of IT systems in logistics? How is this evolving and what needs to be improved in the future?

This is a really important question. When you look at the bigger defence markets like the US and UK we find that logistics across various agencies is still conducted with legacy systems that go back decades.

Over the years, all of these separate systems have gathered a lot of data and information. In the 80s and 90s some agencies tried to do transformation into single enterprise resource planning (ERP) like Oracle or SAP but most defence ministries have home-grown solutions that were provided in-house. Over the years they then brought in systems integrators like IBM and Fujitsu to update their systems incrementally. So most countries have multiple systems that are either service-based or asset-based and I don’t think many MoDs today have the money to transform their IT systems into a single solution. It’s just not workable or cost effective. But we know that there is such rich data in all these legacy systems so the forward-thinking countries are now looking at how we can integrate all this relevant data into current management systems and help make better, more informed command decisions.

What we will see evolving now is things like service-oriented architecture (SOA) solutions to help find and provide that information and then, if people are smart enough, they will start using automated identification technologies like RFID and bar-coding to help automate data capture and dissemination. It’s about using smart technologies to extract and reuse (relevant) old data – that’s where the market is going. To use the buzzword of the moment, it is the Internet of Things (IoT). Everyone talks about information management – where databases are sliced and diced – but actually automation at the execution level (such as issue receipt or MRO) using RFID technologies can provide you with a much better understanding of where your assets are and where you need to move them to. In addition, it’s a more cost effective approach than trying to implement and train people on new systems. The key to IT systems transformation is balancing new automation technologies with service-oriented architecture solutions.

What are the key things to note here? What should militaries be focusing on?

The first thing you need to do is ensure you are improving data accuracy when entering or extracting data by using smart technologies like RFID. In the new world of agile operations, forces don’t have time to type in and track assets manually. The future of logistics – specifically when thinking about the transformation of IT systems – will all revolve around the Internet of Things, master data management and data accuracy.

Where do the technology gaps lie in logistics today?

Aside from multiple legacy IT systems and issues with data accuracy, one of the biggest gaps that we have today, which has resulted from IT being outsourced to industry, is that there is an inability within organisations to analyse and understand supply chain data. Correct analysis of this data means you will not over or under supply – we need to plug the technology gap when looking to transform the data between old and new systems.

What would be your advice to defence customers looking at their logistics operations in the future?

When an organisation takes the decision to transform their system it’s important to apply the resources and make sure it is implemented as soon as possible – historically uptake has been too slow. If I was to make a recommendation to government and military organisations I would say go for a system that is going to give you an incremental return on investment (ROI) rather than a "big bang" approach that will take you years to realise the benefits of. The ROI will only come after it has been implemented, so ensure it is up and running as soon as possible.