Home' Defence Magazine : Issue 8 2009 Contents 21
workforce and shared services
government investment in
Defence capability is one of the
largest discretionary items in the
commonwealth budget. During the
next 10 years, the Defence Materiel
Organisation (DMO) will manage
some 230 major projects each worth
more than $20 million, as well as the
sustainment of more than 100 ADF
fleets and weapons systems.
The Mortimer Review
and strategic Reform
Improving accountability in Defence is a central
theme of both the 2008 Defence Procurement and
Sustainment Review, led by David Mortimer AO (the
Mortimer Review) and the Strategic Reform Program
(SRP) now under way in Defence.
In total, the Mortimer Review made 46
recommendations aimed at improving the overall
effectiveness of Australia’s defence capability
development, procurement and support systems. The
Mortimer recommendations agreed by Government
complement, and are being implemented alongside,
the other elements of the SRP.
One of Mr Mortimer’s recommendations was the
development of charters for the managers of complex
and demanding acquisition projects and sustainment
products. He identified this as an effective way to
address concerns identified by DMO managers that
existing delegations and approval requirements could
be clarified and strengthened.
Mr Mortimer proposed that a solution, used in
the business sector to enhance both individual and
organisational accountability for performance, be
adapted for use in the DMO.
This involves agreement to a charter between
the organisation and the manager, stating exactly
what is to be delivered and what resources are
to be provided. This allows projects and products
to be managed as proper business undertakings,
leading to improved acquisition and sustainment
outcomes and providing DMO with valuable
The charters refer to the results required under
the relevant Materiel Acquisition and Sustainment
Agreements between Defence and DMO.
What is a charter?
Charters are not a legally-binding document,
but they are a formal agreement, made in good
faith between two parties.
In this respect, charters are not a one-way
street. In the same way that each charter describes
the results the project or product manager must
deliver, it also documents the commitments the
manager’s division makes to support them in
acquiring new equipment or sustaining existing
Again this mirrors Agency Agreements where
the obligations of both Defence and DMO should
The charters also provide guidance on the
behaviours expected of project and product
Progress to date
The DMO has made good progress
implementing this initiative, with 74 charters
agreed and issued to date.
Charters have been developed for the
DMO’s most demanding and complex projects
and products. The complexity of a program takes
account of a range of factors (not just a project or
product’s dollar value).
The charters provide managers with clarity
and certainty over what is expected of them
and what they are accountable for delivering, as
specified in the relevant performance and funding
agreement between Defence and the DMO.
Managers are also responsible to ensure plans and
estimates related to their outputs are maintained
and that the reports provided are timely, accurate
Under the charters, DMO’s divisions commit
to provide the resources and delegated authority to
enable the individual manager to do the job and must
assist the manager to obtain agreed levels of support
from Defence or the DMO if this does not eventuate.
Implementation of the charters is also an
important contributor to wider sustainment reforms
in the DMO. The charters ensure that the DMO
continues to focus on its reason for existence –
equipping and supporting the ADF.
Further information on the Mortimer Review
and the DMO project and product charters can be
found on the Intranet, via the link to DMO. Further
information can also be found on the broader SRP
Charting the course
for future success
DeFenCe MAterIeL orGAnIsAtIon
By Harry Baxter
■ What are the implementation requirements?
■ What level of geographical and functional
rationalisation is optimal?
■ Who needs to be accountable for the activity?
How shared services will benefit
Shared Services is an effective way of
addressing many issues commonly found in
delivering support functions like human resource
management or finance. The objective of the
Shared Services initiative to make sure that
the services provided to Defence are as cost-
effective, efficient and flexible as possible. Some
of the benefits that will be delivered from this
■ enabling all Groups and Services to focus on
core business requirements
■ driving smarter business improvement and
efficiency in support processes
■ focusing on and delivering service excellence,
■ increasing the transparency and visibility of
services received and their associated costs.
When will WssR happen?
Some reform is already happening –
contractor positions are being converted to new
APS positions and work has commenced to identify
ADF positions suitable for civilianisation.
Senior Defence committees will be examining
proposals at the end of November 2009 and
advice to Government will follow. We expect some
initiatives will commence in early 2010 with full
implementation completed by June 2014.
The WSSR team will continue to provide
reform updates through Defence senior leaders
and managers, so speaking with your manager
is a great way to better understand changes in
In addition, all reform updates will be
published on the Workforce and Shared Services
website – look under People Initiatives on the
People Strategies and Policy Group intranet site.
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