Suppliers will not have to wait until 2016 to begin planning their responses to opportunities under the Department of Defence’s ERP transformation program – Defence Insight, with the agency planning industry engagement prior to seeking first pass approval from the Federal Government.
According to an approach to market released today, Defence intends to outline its “current thinking, particularly in terms of scope and complexity, [and] the delivery models presently under consideration” to system integrators on 17 December 2015.
Defence’s ERP transformation program – known as Defence Insight – is expected to help the agency realise the One Defence business model, outlined in the First Principles Review which was released 1 April 2015. The review called for consolidation and standardisation across the information management functions of Defence. “Information management is a critical enabler for One Defence… [but] it is apparent that current practices are materially impeding operational effectiveness and efficiency”, the review states.
The agency signed a $6.36 million contract with Deloitte to design Defence’s Enterprise Resource Planning Roadmap Program on 14 April 2015.
Defence CIO Peter Lawrence told the Technology in Government Summit in August 2015 that Defence makes use of roughly 2500 applications, including 300 financial applications. However, he said that a $86 million contract with SAP signed in July 2015 was a step towards helping the department meet its changing need for systems to be available both on deployment and inside the office in order to improve enterprise decision making.
Defence’s decision to engage industry at the early stages of Defence Insight is also in keeping with the review, which recommended that the agency overcome duplication and institutionalised waste by tailoring its procurement strategy to “a leaner ‘smart buyer’ model that better leverages industry, is more commercial orientated and delivers value for money.”
“This approach has been designed to promote collaboration and the sharing of ideas and market intelligence throughout the industry engagement and procurement process,” according to ATM documents.
The ATM notes that the program will remain unapproved until Defence seeks first pass approval from the Government, expected occur in March 2016. The agency has made it clear that any “participation in Market Briefings and other Defence Insight activities is at your organisation’s own risk, cost and expense.”
“Industry is under no obligation to respond to this invitation and non-attendance at the proposed Market Briefing will not preclude participation in future stages of the procurement process for Defence Insight (if any are conducted).“
The Department of Finance is also working on ERP rationalisation at a whole of government level, as the Government endeavours to save $31.4 million over two years from 2017‑18, as outlined in the 2015-16 Budget.
Defence was the highest-spending Federal Government agency in 2014-15 according to Intermedium’s Analyse IT tool, which indicates the agency had 3,486 contracts with a total contract value of $2.2 billion for the year.