Changes in MOD procurement & commercial structures – Gray cements his position

After our story about the MoD consulting contract last week, we saw an announcement about the restructuring of the key Defence Equipment and Support (DE&S) organisation and the central commercial function in MoD.

In summary, the biggest outcome is a major concentration of power in the hands of Bernard Gray, the Chief of Defence Materiel. The post of Commercial Director in the centre of the Department, filled by Amyas Morse and currently Andrew Manley, has been abolished. As the MOD announced:

Departmental leadership for commercial advice will be transferred to the Chief of Defence Materiel, and the MOD commercial function will be reorganised.

So Gray fills that commercial role both in a corporate sense and as Head of DE&S. That will certainly have the advantage of clarity, although it also obviously puts a huge amount of power and responsibility on his shoulders given that Andrew Tyler, the COO of DE&S is leaving, not surprisingly as he was an unsuccessful candidate for Gray's role. There are also rumours that Andrew Manley may follow, but at the moment he is running the Defence Infrastructure Organisation (the successor to Defence Estates).

Perhaps more unexpectedly, Gray has restructured DE&S so that the commercial heads for each of the three services are more powerful.  We say unexpectedly, as in his 2009 report, he made much play on how interservice rivalry was getting in the way of good acquisition performance. This move would therefore not seem to be fully consistent with his previous ideas - this is from page 1 of his report:

In particular, the Armed Forces, competing for scarce funding, quite naturally seek to secure the largest share of resources for their own needs, and have a systematic incentive to underestimate the likely cost of equipment.

We also don't know yet where this leaves Les Mosco, the Commercial Director for DE&S, the most senior procurement professional in MOD now - and as a CIPS ex-President, a well-known figure in the procurement world.

Will this improve defence acquisition? We won't know really for several years given the sort of lead times we're talking about.  What is clear, however, is Bernard Gray will be very clearly responsible for the outcome, whatever that might be.


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