Pressure from the suppliers now

Discussion in 'Current Affairs, News and Analysis' started by captaincalamity, Feb 21, 2008.

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  1. Looks like defence manufacturers are putting the pressure on the Govt now, and whilst I wouldn't for a moment think that they ultimately have the Forces best interests at heart - cost overrun anyone, they do have a point about short termism:

  2. Heard some cnut from BAE bleating about this on Today. It was when he said something along the lines of"we're renowned for providing cheap, quality kit to the MOD" that the radio spontaneously leapt through the window.

    Just off down town to get a new FM radio...
  4. No wishing to defend BAEs' quality control, however I agree with the short term ism whinge.

    I was lucky enough to visit BAS ship building in Glasgow a couple of years ago. They employ a number of highly skiled specialist people, welders, electricians etc. It takes upto 7 years to train new people up to the full standard. In order to keep those people employed they need a steady order book, known several years out. They also tend to make a loss on the first ship of any class and are reliant on developing more efficient methods throughout the class order to generate the profit. The MODs constant chopping and chaninging of order sizes and dates means that the costs of ships remains higher as they cannot guarenntee large enough ship class orders to generate their manufacturing consitancies and hence cost savings. It also means that they have to retain the skiled work force through the lean times to retain the capability. All costs which they rightly pass onto the MOD.

    The constant tinkering with the order book and inability to make serious decsisons early is costing us millions if not billions.
  5. Hit the nail on the head there - its not just ship building but all areas of defence where skills and knowledge are built up over a number of years. Even the retention of older systems causes problems as younger engineers have to re-learn entire systems as the original engineers have retired. All the cost of this is also passed onto the buyer. If anyone in the Governement had actually been in Industry for any amount of time then they would have realised this.

    BTW - the SBAC is a society of companies in the same industry thats all - if 2000 odd companies are saying the same thing then the Governement should pay attention. As for the British company looking to move to America but continuelly crowing about being British - nuff said about that ;-)
  6. The problems with the big ticket programmes is bad enough but there is an ever bigger hole in the R&D budget, and real expertise and capability both within the MOD system and in industry is being lost here too. You cannot expand the role of the services as has been done to keep NuLabor at the big boys table without either spending more, or accepting that in the end you will be less capable, and despite the spin the second option is the way we are going.
  7. meridian

    meridian LE Good Egg (charities)

    A company has a legal obligation to trade at a profit. It is against company law to trade insolvently so for anyone from any company to say they have others interests at heart is just total and illogical nonsense

    BAe exist to make profit for their shareholders.

    A strategy of keeping ones customers happy and controlling costs is ultimately a strategy to achieve that aim.

    However, the point about consistency of orders is well made and again entirely logical. A long term order stream provides certainty, certainty allows investment in equipment and crucially people to be made that ultimately benefits both the company and its customers.

    It is dangerous and we will/are/have reaped the whirlwind of short termism. One of the reasons the Astute sub is so eye wateringly over budget is exactly because vital skills were allowed to wither whilst waiting for orders, they had to be bought in from the USA. Kerching