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This section includes a number of key documents on procurement policy. In the UK, the USA and Australia (in particular), a number of insightful studies have now been undertaken looking at key issues that defence agencies and private sector partners have faced in procurement, most specifically in equipment purchases and large capital projects. The literature places particular emphasis on project commissioning and procurement, and contract design and performance.
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| The privatisation of QinetiQ (PDF) |
| House of Commons Committee of Public Accounts, 2008 |
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This report analyses the privatisation process of QinetiQ during its two phases. According to the CPA, the first phase in which a minority stake in the business was sold to the private equity firm, the Carlyle Group, was mismanaged. The second stage, however, a flotation on the London Stock Exchange, was conducted smoothly. This report includes the formal meeting minutes and the transcription of interviews with the Ministry of Defence, Shareholder Executive and the Chairman of QinetiQ.
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| UK |
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| Smarter Food Procurement in the Public Sector (PDF) |
| House of Commons Public Accounts Committee, 2007 |
| The Stationery Office |
| This report examines the organisations responsible for the three largest areas of public food procurement - Department for Education and Skills, the Ministry of Defence and the NHS Purchasing and Supply Agency. It argues that improving certain practices such as pricing negotiations and levels of frontline expertise can allow public bodies to improve significantly the efficiency of their food procurement while also sourcing ethically and enhancing sustainability. |
| HC 357 |
| UK |
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| The Defence Industrial Strategy (HC 824 Seventh Report of Session 2005-2006) (PDF) |
| House of Commons Defence Committee, 2006 |
| London: The Stationery Office |
| This report examines the Defence Industrial Strategy (DIS), the Ministry of Defence (MoD) White Paper (available below). It weighs up the initial reaction of the defence industry and other interested parties to the DIS, the likely impact on the defence industry, the changes required of the MoD, and future plans for its implementation. |
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| UK |
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| Defence Industrial Strategy (CM 6697) (PDF) |
| Defence White Paper, 2005 |
| Ministry of Defence |
| The Defence Industrial Strategy (DIS) aims to provide greater transparency of future defence requirements, sets out industrial capabilities required, and examines how the MOD should engage with the industrial base in order to ensure the capability of requirements of the Armed Services can be met currently and in the future. It provides reviews by industrial sector and cross-cutting capabilities, gives further detail on the principles and processes that underpin procurement and industrial decisions, and investigates how capacity gaps might be addressed. It concludes with suggestions on how to take the strategy forward - implementing and putting the DIS into action. |
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| UK |
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| The Innovative Use of Private Finance in Defence Acquisition |
| Whitehall Paper 63, 2004 |
| Royal United Services Institute for Defence and Security Studies |
| This paper reviews the issues concerning the use of private finance in defence acquisition and examines some possibilities for its future evolution. It asserts that although the use of private finance in the front line is contentious, with commercial and military goals likely to conflict, there is potential in a combined public-private sector approach to profit and risk sharing which could help develop and protect the secondary markets for defence assets that would be necessary for effective operating leases and capability contracts. |
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| UK |
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| Defence Procurement (HC 572-I Sixth Report of Session 2003-4) (PDF) |
| House of Commons Defence Committee, 2004 |
| London: The Stationery Office Limited |
| The Ministry of Defence's Smart Acquisition, this report argues, has failed to deliver in its objectives to procure faster, cheaper and better. It finds that a key underlying cause of poor performance has been the MoD's failure to invest enough money and time in de-risking the projects in the Assessment Phase, and that routine trade-offs between performance, cost and time have not been implemented as intended, as with whole-life costing and the approach needs to be bought into line with Best Practice. |
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| UK |
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| Defense Acquisitions: Space-Based Radar Effort Needs Additional Knowledge before Starting Development (GAO-04-759) (PDF) |
| United States Government Accountability Office, 2004 |
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| The Space-Based Radar represents the first time the US Department of Defence has lead the development of national space capability in partnership with the intelligence community. This review aims to assess the DOD's progress in attaining the knowledge it needs in terms of requirements and resources. This report includes interesting observations on the challenges that occur in requirement setting and the allocation of responsibilities in complex procurement projects. |
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| USA |
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| Competitive Sourcing: Greater Emphasis Needed on Increasing Efficiency and Improving Performance (GAO-04-397) (PDF) |
| Report to Congressional Requesters, 2004 |
| United States General Accounting Office |
| The 2001 President's Management Agenda introduced competitive sourcing as a government-wide initiative seeking to expand competition between public and private sectors. While expected to encourage innovation and improve efficiency and performance, competitive sourcing also represents significant management change for most agencies. This report describes the progress certain agencies have made in establishing such a programme, identifies major challenges faced and strategies used to select activities for competition. |
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| USA |
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| Acquisition Management System (Web Page) |
| Ministry of Defence, 2004 |
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| An online information resource that gives access and guidance on all elements and principles of Smart Acquisition (SA) and the MOD Defence Acquisition Community. |
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| UK |
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| Missile Defense: Additional Knowledge Needed in Developing System for Intercepting Long-Range Missiles (GA-03-600) (PDF) |
| Report to the Ranking Minority Member, Subcommittee on Financial Management, the Budget, and International Security, Committee on Governmental Affairs, U.S., 2003 |
| United States General Accounting Office |
| A review of technical and cost related issues of the US Ground-based Midcourse Defense and of any significant associated risk. The report includes interesting observations on challenges arising from inadequate knowledge and unreliable data when setting project requirements. |
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| USA |
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| Ministry of Defence: Through-Life Management (HC 698 Session 2002-03) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2003 |
| London: The Stationery Office |
| This report examines the extent to which Through-Life Management is leading to effective delivery of military capacity. It argues that Through-Life Management is a key element of Smart Acquisition, requiring major change and linked to other changes. But the Department sill has to fully develop and coherently mange this change programme. |
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| UK |
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| Defence Industrial Policy (PDF) |
| Ministry of Defence Policy Papers, No. 5, 2002 |
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| The key conclusions of this policy document are to be more transparent and inclusive during procurement, ensure open and fair competition, investment in research and development and maintenance of a close dialogue with industry. |
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| UK |
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| Major Procurement Projects (HC 799 Fourth Report of Session 2001-02) (PDF) |
| House of Commons Defence Committee, 2002 |
| London: The Stationery Office |
| This inquiry focuses on warship procurement strategies, the use of PFI for acquiring capabilities and the Sea Harrier's withdrawal from service. It also looks at aspects of 'information superiority' capability and the direction of the Smart Acquisition initiative. |
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| UK |
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| Competitive Sourcing: Challenges in Expanding A-76 Governmentwide (GAO-02-498T) (PDF) |
| Statement of Barry W. Holman, Director Defense Capabilities and Management, 2002 |
| United States General Accounting Office |
| Under A-76, commercial activities may be converted to or from contractor performance. The Department of Defense faced a number of challenges with this programme, for example: the estimated length of the studies, underestimates of cost and resources, difficulties in selecting and grouping functions and difficulties in determining and maintaining reliable estimates of saving. Lessons from these challenges may provide valuable lessons for other federal agencies. |
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| USA |
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| Ministry of Defence: Implementation of Integrated Project Teams (HC 671 Session 2001-02) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 2002 |
| London: The Stationery Office |
This report explores the implementation of Integrated Project Teams (IPTs), introduced as a core element of Smart Acquisition, with the aim of improving acquisition by using a project-based approach. It finds that IPTs were introduced quickly and successfully but need to evolve further and that firm direction is needed in order to maintain momentum. |
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| UK |
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| Defence Acquisition (PDF) |
| Ministry of Defence Policy Papers, No. 4, 2001 |
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| This paper gives a brief overview of Smart Acquisition, the Defence Procurement Agency, Defence Logistics Organisation, Defence Estates and Equipment Capacity Customer, its new integrated approach to public-private partnerships - and some of the relationships between them. It also evaluates key components of Defence Acquisition. |
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| UK |
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| European Defence Policy Paper No. 3 (PDF) |
| Ministry of Defence Policy Papers, No. 3, 2001 |
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| This report gives an overview of The European Security and Defence Policy, including discussion on the efficiency and effectiveness of spending on equipment projects and other programmes. |
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| UK |
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| Bidding Behaviour in the Department of Defense's Commercial Activities Competitions |
| Snyder, Christopher M., Trost, Robert P., Trunkey, R. Derek, 2001 |
| Journal of Policy Analysis and Management, Vol. 20, No. 1 (Winter 2001), pp.21-42 |
| This paper uses a three equation model to estimate potential savings related to the experience of the Department of Defense and A-76 competition. It estimates that the DOD saved $1.55 billion annually and could save $7.58 billion more annually if it allowed a broader set of commercial activities to undergo similar competition. |
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| USA |
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| Personnel Savings in Competitively Sourced DOD Activities: Are They Real? Will They Last? |
| Gates, Susan M., Robbert, Albert A., 2000 |
| RAND Monograph Report |
| This study examines the personnel costs associated with several projects that the Department of Defense put up for competitive tender and the methods used to deliver the projects. Most savings were obtained through techniques that allowed for the task to be completed with fewer personnel. |
| ISBN: 0-8330-2826-X |
| USA |
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| Issues Related to Competitive Sourcing (PDF) |
| Hynes, Michael; Kirby, Shiela Nataraj; Sloan, Jennifer, 2000 |
| A Casebook of Alternative Governance Structures and Organizational Forms, RAND, pp. 93-106 |
| This appendix gives a brief overview of cost competition and examples of best practice in relation to competitive sourcing. |
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| USA |
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| Competitive Sourcing (PDF) |
| Hynes, Michael; Kirby, Shiela Nataraj; Sloan, Jennifer, 2000 |
| A Casebook of Alternative Governance Structures and Organizational Forms, RAND, pp. 69-84 |
| Using case studies from both the USA and the UK, this chapter discusses the background, results and lessons learned from seven projects of competitive sourcing. |
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| USA |
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| Modernising Procurement (HC 808, Session 1998-99) (PDF) |
| National Audit Office: Report by the Comptroller and Auditor General, 1999 |
| London: The Stationery Office |
This report compares characteristics, such as outcomes of recent competitions, with previous competitions, in terms of competition winners, time required to complete, savings produced and other relevant metrics. It identifies any problems in implementing the results of the competitions, and plans for government monitoring of contracts awarded as a result of the outsourcing. |
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| UK |
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| DOD Competitive Sourcing: Questions about Goals, Pace, and Risks of Key Reform Initiative (GAO/NSIAD-99-46) (PDF) |
| Report to the Chairman, Subcommittee on Military Readiness, Committee on Armed Services, House of Representatives, 1999 |
| United States General Accounting Office |
| This report reviews the progress of government procurement through competitive sourcing, the A-76 programme. It identifies the competition and savings goals of the programme, assesses the accuracy of the savings estimates provided to Congress, and evaluates the success of planning in support of the programme. |
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| USA |
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| DOD Competitive Sourcing: Results of Recent Competitions (GAO-NSIAD-99-44) (PDF) |
| Report to the Chairman, Subcommittee on Readiness and Management Support, Committee on Armed Services, U.S. Senate, 1999 |
| United States General Accounting Office |
| This report compares characteristics such as outcomes of recent competitions, with previous competitions in terms of competition winners, time required to complete, savings produced, and other relevant metrics. It also identifies any problems in implementing the results of the competitions, and plans for government monitoring of contracts awarded as a result of the outsourcing. |
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| USA |
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| Defence Procurement in the UK |
| Hartley, Keith , 1998 |
| Defence and Peace Economics, Vol. 9, Issues 1& 2 (March 1998), pp. 39-61 |
| This paper analyses the demand and supply sides of the UK defence market, examining of the role of the Ministry of Defence (MoD) as a buyer, its competitive procurement policy and evaluates its result, problems, and future prospects. |
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| UK |
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| European Defence Procurement: Towards a Comprehensive Approach |
| Trybus, Martin , 1998 |
| European Public Law, Vol. 4, No. 1 (March 1998), pp. 111-133 |
This paper discusses European regimes on competition, merger control, subsidies and exports with regards to the possibility of future liberalisation of defence procurement within Europe. In Public procurement Volume II, Ed. Arrowsmith, Sue and Hartley, keith, Edward Elgard Publishing Ltd, 2002, pp 735-757 EC regimes on competition, merger control, subsidies and exports in light of the possibility of the future liberalisation of defence procurement within Europe. |
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| UK |
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| Analysis of DOD's Commercial Activities Program |
| Trunkey, R Derek, Trost, Robert P., Snyder, Christopher M., 1996 |
| Virginia: Centre for Naval Analyses |
This paper presents the results of all completed Department of Defense comprehensive A-76 competitions between 1978 and 1994. |
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| USA |
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| An Overview of Defence Procurement in the Federal Republic of Germany |
| Tyrbus, Martin , 1996 |
| Public Procurement Law Review, Vol. 5, pp. 217-244 |
| An introduction to specific issues affecting defence procurement in the Federal Republic of Germany. |
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| The Future of European Defence Policy: The Case for a Centralised Procurement Agency |
| Cox, Andrew , 1994 |
| Public Procurement Law Review, Vol. 63, pp. 65-86 |
This paper covers the history of European Defence Policy since the Second World War, including procurement; and an analysis of various possible approaches to future European defence policy and procurement structures. In Public Procurement Volume II, Ed. Arrowsmith, Sue and Hartley, Keith, Edward Elgar Publishing Ltd, 2002, pp 713-734. |
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| UK |
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| Economic Incentives and the Defense Procurement Process |
| Rogerson, William P. , 1994 |
| Journal of Economic Perspectives, Vol. 8, No. 4 (Fall 1994), pp. 65-90 |
| This paper describes the underlying incentive problems that shape the defence procurement problem, how institutions affect actors' behaviour and possible improvements. It argues that incentives created by the way government organises its internal decision-making processes impact on the outcome of the defence procurement process. |
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| USA |
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| Defence Procurement (Web Page) |
| Industry Commission, Report No. 41, 1994 |
| Canberra: Australian Government Publishing Service |
| This report reviews the efficiency and effectiveness of current defence procurement in Australia in achieving value for money, and the impact of procurement programmes on particular industries. It includes an analysis of procurement policy, programs and procedures, and future trends in procurement expenditure and longer term supplier arrangements. |
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| Australia |
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| Reform of United States Weapons Acquisition Policy: Competition, Teaming Arrangements, and Dual Sourcing |
| Burnett, William B. and Kovacic, William E., 1989 |
| Yale Journal on Regulation, Vol. 6, No. 2 (Summer 1989), pp. 249-317 |
| This paper discusses the competition experiment in US weapons acquisitions policy. It examines the replacement of the traditional public utilities regulation model with the competition model as an incentive for good supplier performance. |
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| USA |
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| The Weapons Acquisition Process: Economic Incentives |
| Scherer, Frederic M , 1964 |
| Division of Research, Harvard Business School |
| This paper contains interesting observations on economic incentives in weapons acquisition, reputation and the role of past performance in selection decisions, and the use of contractual incentives. |
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| USA |
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