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Subject: German bidder holds fire on guns
hairy man    6/23/2009 7:26:05 PM
From "The Australian" THE army's $450 million plan to acquire new 155mm self-propelled guns faces a one-year delay because of the complexity of the Defence Materiel Organisation's tender process. The revelation comes as one of the two contenders to supply the artillery declined to participate in the final tender negotiation with the DMO. German firm Krauss-Maffei Wegmann, whose PzH 2000 gun was favoured to win the contest to supply up to 18 guns to the army, has declined to participate in the offer definition and refinement process with the organisation. KMW is competing against Raytheon Australia, which is teamed with Korean manufacturer Samsung Techwin, which is offering the AS-9 gun. Senior government sources told The Australian yesterday that neither tender had fully met the DMO's tough contractual requirements. Only the Raytheon consortium has chosen to continue negotiations with the DMO. According to informed sources KMW has cited problems with intellectual property as well as a requirement for more equitable risk-sharing with the commonwealth in its decision not to participate in the offer definition and refinement process. Raytheon is now pushing hard for an early decision but the KMW tender offer will remain on the table and valid until next April. Last month DMO chief Stephen Gumley told a Senate estimates committee there were a number of "technical issues" that had to be resolved before a decision could be made on a preferred tenderer. The German firm, which is partnered with BAE Systems Australia, has offered brand new surplus Dutch army guns as part of its tender in the Land 17 project. The PzH 2000 gun is in service with the Dutch military in Oruzgan province in Afghanistan and has impressed the Australian army with its all-round capability. A final decision on Land 17, the project that will have the army equipped with both self-propelled and towed artillery, was expected by mid-2009. The Rudd government's defence white paper, published last month, called for the acquisition of two batteries of self-propelled guns (a total of 12 guns) and four batteries of towed guns. The Defence Department hopes to wrap up a decision on the towed artillery later this year, with the M777 howitzer, built in the US by BAE Systems, expected to be chosen.
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Aussie Diggermark 2       6/25/2009 10:15:19 AM
The translation of KMW's notification that it was ditching this project went something along these lines I believe:
We are sick and tired of mucking around on this schittful project for a rubbish order of no more than 12x operational guns. We are NOT spending our millions on integrating a foreign FCS for a project that will barely provide as much profit, if even that. It is not worth our time and effort to be involved any further in something that has dragged on for such a ridiculously long period of time, despite DMO's protestations that it is in fact an "off the shelf" gun acquisition...
Our gun with OUR FCS is considered good enough to support Australian troops on operations in Afghanistan, thus allowing the Australian Government to refuse to maintain any sort of backbone and actually deploy a conventional combat capability  overseas, but despite this, we now find that our gun somehow doesn't meet Australian requirements. Bearing this in mind, as an interim measure, in order to shore up our potential legal liability given our gun doesn't meet Australian requirements, no calls for fire support will be answered and no direct support provided to Australian forces overseas by KMW contractors or equipment, including the PZH-2000 155mm self-propelled gun, currently deployed to Afghanistan.
We wish the Australian Government and Department of Defence all the best in attempting to find a competent defence contractor who is prepared to invest millions of their own capital, in a project that will not generate as much in profit.




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ArtyEngineer       6/25/2009 10:05:37 PM
Thats pretty much how I interpret it also.  Basically "Stop mucking us around, our offer is on the table, call us when you are serious!!!!"
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gf0012-aust       6/25/2009 10:41:13 PM

Thats pretty much how I interpret it also.  Basically "Stop mucking us around, our offer is on the table, call us when you are serious!!!!"
The only problem is that DMO are getting tarred with this when its actually the fault of 2 other groups.  DMO acts at he sponsnsors and stakeholders discretion.  All the more reason for a new Minister to actually have a look at how projects derail.
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ArtyEngineer       6/26/2009 12:00:41 AM
So what exactly is the issue thats causing all the hate and discontent? 
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Volkodav       6/26/2009 4:36:56 AM
So what exactly is the issue thats causing all the hate and discontent? 
Well if you asked my boss tonight the answer would be "Because the Commonwealth is incompetent, inefficient and negligent". If we were a private company we would sue them.
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gf0012-aust       6/26/2009 7:59:30 AM
the usual sins:

scope creep
stakeholders shifting the goal posts
stakeholders  modifying the requirement to buggery
too many parties with veto control (see above 3)
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Volkodav       6/26/2009 8:49:23 AM
and everything gf just said too....
Everyone knows about the big ticket projects that are behind schedule and over budget but there are also many tenders where the contractor, acting in good faith, gets shafted by the CoA's behaviour. They invest time and money into providing exactly what the ADF says they need only to be told that the item or service is no longer required.
Often, unfortunately, the CoA don't seem to comprehend what they are asking for, how much it will cost, or the consequences of not actually following the professional advice of the contractor.
Basically, the way the CoA often behaves is not dissimilar to what you see in disaster documentaries about building, or bridge collapses etc. were the root cause is established to be the owner bullying, harassing or simply replacing contractors who refuse to do the wrong thing.
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ArtyEngineer       6/26/2009 11:11:36 AM
As a Design Engineer/Test Engineer who took the M777 all the way from Prototype through EMD phase to Pilot Production to Low Rate Initial Production to Full Rate Production I am intimately aware of "Specification Creep" and the issues this can lead to with continuos need for Contract Ammendments and request for supplemental funding etc.  However as a completely developmental program where we were on the hairy edge of material science and manufacturing capabilities for practicvally the whole development cycle I can understand why at least for us thing were teh way we were. 
WIth regards to teh PzH 2000 I cant quite get my head round the specifics of the issue?  Im going to hazard a guess that whatever specification is creeping in cannot be a performance characteristic of the howitzer.  Similarily I dont see it as being a Fire Control Integrating issue between the PzH and the Raytheon AFATDS.  That type of message traffic is standardised or so I thought?  I can only image that the issues are primarlily arising from whatever Contractor Support aspect is also forming part of the total procurement deal.
If anyone knows specific issues and is at liberty to divulge I would be very interested to know.
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doggtag       6/26/2009 11:53:29 AM
...Kind of makes those of us in the States not feel so bad anymore.
Obviously, ours isn't the only government full of incompetent, ineffective (barely effective?), and inept bureaucracy.
Maybe it's just because we do all that too, but just on a grander scale, that makes us look so bad?
(Or could it that the rest of the world just considers it business as usual in the USA?)
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Aussiegunneragain    AE   6/26/2009 9:17:28 PM

So what exactly is the issue thats causing all the hate and discontent? 

Apart from what GF said the uniforms involved in procurement don't have background or expertise in government procurement but they think their shit doesn't stink and consequently hold the civilians who do in contempt, and don't listen to them. Consequently the civilians don't trust the uniforms and push back with multiple hoops for them to jump through when making purchases. I've heard one civvie who has been involved in procurement say of the uniforms "I wouldn't trust them to buy a packet of biscuits". Thats on top of the culture of risk aversion (which shits me to tears) that is normal in the APS. Its all bad.
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