Defence Views: Performance step changes through digital innovation

In a nutshell

Partner and Head of Defence, Stephan Smith reflects on what we really mean when we talk about digital innovation in UK defence.

Stephan Smith


Stephan Smith

Posted October 31, 2022

Digital innovation is everywhere. But what do we really mean when we talk about digital in UK defence?

For the team at Newton, relevant digital innovation enables our clients to confidently make quick, data-driven decisions in real-time, as well as the risk-informed decisions required in their long-term strategy. When our clients can optimise the speed and accuracy of decisions, the risk involved is far lower. Through the smart use of digital, you can truly change the way an enterprise operates.  

Newton’s focus within the umbrella of ‘digital innovation’ is advanced modelling and embedding it within organisations to solve challenges. Advanced digital modelling can affect real world outcomes, and in the context of defence that means keeping the UK safer. UK Defence should make wider and more effective use of digital to bring people from across the enterprise together, to improve speed and accuracy of decisions, organisational resilience, and readiness, particularly at this critical time.  

Why now?

The urgency created by Russia’s invasion of Ukraine means that UK Defence needs to be able to react quickly with evidence-based decisions that it knows are correct today and supports the long-term strategy. What our clients ask for most is the ability to model forward for one, ten, 20 years; to understand, for example, the factors that will really impact availability of a fleet. Understanding that in X years from now something is going to catch us out, means we can pre-emptively decide how to address each risk years before we incur them.  

Advanced modelling enables us to identify the optimum strategy from millions of scenarios. We can interrogate the models in terms of risk, cost, and other factors, to inform the best possible decisions. Our clients can develop optimised strategies, for example, optimal usage, maintenance, and procurement strategies that maximise fleet availability. And because modelling enables high speed decision-making, these strategies can become dynamic, allowing responses at the speed of relevance to a changing world.    

The challenge

In a recent programme, we set out to significantly improve availability of a fleet within the existing budget. Our objectives were to bring people from across the enterprise together to optimise the capability, remove organisational barriers, and enable data-driven decisions at greater speed.  

At the heart of this challenge were two elements: a lack of shared and trusted information, and a culture of reactive decisions, creating availability challenges and significant additional spend. 

We first proved the potential to enable real change in this kind of situation in the face of an urgent operational requirement. Availability for a key asset was not where it should be, and every party involved pointed to a different underlying issue, from too small a fleet, a too low maintenance tempo, or supply chain responsiveness. The reality was complex. Putting in place a trusted model allowed all parties to align to the levers they each controlled to improve availability. Importantly, it allowed everyone to understand what they could enable for others and in what order that would have maximum benefit.  

This is a fundamentally different way of doing business for defence.

Organisational barriers

In fact, the enterprise was driven towards making the wrong decisions by contractual KPIs, which were driving what was needed decades ago and not what is required for the future. This issue is UK-wide, related to the way that many sectors, including defence, set up the commercial construct. Contracts themselves can create barriers. If you want to comply with your contract, that doesn’t necessarily mean you’re doing the best thing today for UK Defence. We see this all the time – a focus on green KPIs and not delivering the outcomes needed. 

The single source of truth

How do you start having this conversation about doing what is right? It needs to be at enterprise level. A discussion that says: each organisation, regardless of contracts, has a role to play to deliver a better outcome. A capability can only be maximised by getting past all the barriers that have been created in the way the enterprise has been set up. 

Getting this conversation right brings you to the point where you need to have an enterprise-wide single source of truth. Every party can refer to it to understand which lever they control to improve the outcome for the enterprise. This is what makes the difference. But how do we align a whole enterprise to a trusted single source of truth? There are two components: people, and smart data analysis

People and culture change

You need the data and analysis functionality in place; you can’t afford to get that wrong because this is what builds trust in decisions. Much broader and tougher is getting people across an enterprise to buy into it making a difference and changing how they work. Setting up cross-enterprise communication in the early stages is crucial. This means getting together and agreeing that each organisation will do the right things to drive the outcomes for the whole enterprise as opposed to the things to drive their KPI.  

This is a fundamentally different way of doing business for defence. There’s a reason defence operates in the way it does; because this approach is so hard to get right - you must be able to support it with clear, trusted analysis. Change happens when real-world impact and benefits can be seen as a result of direct actions and decisions that individuals have made; they can see they are making a difference. For example, with everyone working from a common model (a single source of truth), financial benefits, availability benefits, and risks can be seen first-hand. 

Change happens when real-world impact and benefits can be seen as a result of direct actions and decisions that individuals have made; they can see they are making a difference.

Smart data analysis

Whatever kind of modelling or decision-making toolset you use, you need the capability for both fast, accurate decisions, and long-term strategic decisions, so you don’t perpetuate your mistakes.  

In defence we learn a lot from our consultants who worked in F1, developing advanced modelling that enable decisions in seconds like whether a lap should have a pit stop. This versus the through-season understanding of how the car is performing, and how to evolve design to be more competitive. Both the immediate and strategic decisions are crucial to winning. 

At Newton we always start with: what questions do we need to answer to come to the right conclusions? Link only the data you need (structured and unstructured), and understand and measure the impact of decisions and the variables that affect a capability. This allows you to build a single source of truth which provides insights from complex data, for example foresight on risks by mapping the impact of every operational, training, and purchasing decision.   

Targeted and intelligent use

Deploying digital innovation to enact culture change can transform the way in which organisations and enterprises operate. A well-thought through digital toolset fights half the battle in gathering data and presenting insight. The other half is maximising the use that insight; embedding its use into an organisation; driving engagement from users so that habits and culture around decision-making and scenario-planning can change. 

The use of digital and AI is touted as the solution to most of the problems across many industries – defence, infrastructure, healthcare, financial services; the list is long. What it’s all about for me, however, is the targeted, intelligent analysis of data to identify the critical variables and relationships within a specific capability. Doing this well brings immediate step-change improvements.