Launch of Office of Defence Industry Support

Department of Defence

Thank you Tony.

I would also like to acknowledge and thank Senator Jim Molan, AO, DSC.

Aunty Violet, the Secretary, the Chief of the Defence Force, former CDF Sir Angus Houston, all Group Heads and Service Chiefs, and all our partners from industry for attending today’s launch.

There are points in your life, in your career, in a job, where it’s important to take a moment to reflect on where you’ve come from, and how far you’ve come.

Often those moments of reflection come at pivotal moments, more often than not featuring significant change.

For me, in my role as the Minister for Defence Industry, today is one of those moments.

I’ve been the Minister for Defence Industry for two-and-a-half years.

And today, as we launch this new organisation, I can’t help but feel that it’s the culmination of two-and-a-half years of hard work, but incredibly rewarding work too.

Before I talk about the new Office of Defence Industry Support, I want to briefly outline how far we’ve come – and by that I include many in this room.

MY 100-DAY PRIORITIES

In November 2019, having been in the role for just a couple of months, I wrote to the Secretary and CDF to outline my five priorities.

These were the deliverables that I’d seen as essential following what I called my ‘100-day review’ of the Defence Industry portfolio.

As the new Minister you can never be sure how these types of instructions will be received – but this was a big deal and there were problems that I wanted solved.

My first priority was to enhance CASG’s performance delivery to make it a stronger client – increasing its commercial acumen.

My second priority was to expand small business access to Defence.

I also wanted to increase the number of exporting Australian businesses.

Sought to build Australia’s skilled defence industry workforce.

And I wanted to ensure Defence’s Grants, Innovation, Science and Technology programs were contributing to strengthening ADF capability.

While it’s one thing to merely hand over a list of priorities – a list of action items, it’s another to ask ‘why are we doing this?’ What are we trying to achieve?

Why were these priorities for me and for Australia’s defence industry and our nation?

Let me tell you, it wasn’t because it sounded like a nice idea, or to make small businesses feel good about themselves.

My reasoning was clear – I wanted to build our home-grown defence capability to the point that we were able to better protect Australians.

I was then and still are determined that Australia must be able to build at home in order to defend our home.

That is at the heart of everything that I do and I have no doubt everyone in this room as well.

OUR GROWTH

In this short space of time, together with our industry partners and Defence, we have achieved some remarkable feats.

  • We’ve established the AIC Division within CASG.
  • Increased the number of commercial full time staff within CASG by 10 per cent.
  • We’ve delivered a new mandated contracting model for Australian Industry Capability and Content.
  • We’ve built our workforce through programs like the new Defence Industry Pathway Program and the expanded SADI program.
  • We’ve embarked on a review of Defence innovation, the findings of which I’m looking forward to digesting over the coming months.
  • And we’re getting closer to cutting red tape when it comes to Defence procurement, with the findings of the ASDEFCON review to be released in the New Year.

I would like to thank each of you and the Secretary and CDF for your advice and tremendous support in making these changes a reality.

And to Tony Fraser as well for his tremendous efforts in helping to drive these changes within CASG.

ODIS

So that takes me to why we’re here today – ODIS.

As said earlier, I think it’s been important to reflect on how we’ve reached this pivotal moment.

Because the future is now very bright.

Today marks the start of a new chapter for our defence industry.

And importantly, for the Australian businesses that exist within it.

I am single-minded in my view that today represents a new beginning for the way the Services and Defence Groups engage with Australian SMEs.

The Office of Defence Industry Support – or ODIS as it will be known – will operate out of these headquarters here in Canberra.

Let me assure you, this is not some superficial name change to the CDIC.

This is not CDIC 2.0.

This is a new organisation with a redefined purpose.

ODIS will have two primary functions.

It will be a marketplace for Defence and the Primes to seek and find local Australian solutions to capability problems.

And it will help businesses enter – or expand – their footprint in the defence market.

The CDIC did not allow businesses of greater than 200 employees to engage its services.

That is no longer the case. There are no constraints on which businesses can be engaged.

If we are to truly solve Defence capability problems and develop local supply chains…

We need an office that knows the capabilities of our SMEs, who they are and where they are.

We need an office that can bring the key players to the table and provide those local solutions from Australia’s small and medium businesses to Defence and the primes.

That’s what ODIS will do.

Primes will be able to use ODIS and work with it to solve supply chain problems.

Primes will be able to use the many functions of ODIS to help train, educate and facilitate those SMEs that have the potential to fill supply chain gaps.

I will be setting the challenge to each of the Service Chiefs and Group Heads to develop their own plans and strategies for how they will use ODIS to deliver local solutions as the organisation evolves.

MORE FLEXIBLE

One of the perceived roadblocks with the CDIC was that it was inflexible to the point that it was no longer fit-for-purpose.

ODIS won’t be inflexible.

It will adopt a flexible staffing model that will have experienced and specialist staff with Air Force, Navy, Army and commercial backgrounds to ensure the advice provided to businesses is the right advice.

There will be, as a bare minimum to begin with, an additional 16 people spread across the country.

And to ensure ODIS remains fit-for-purpose, its staffing requirements will be reviewed every month for the first 12 months of its existence.

I will not have our small businesses impacted by a lack of resources.

I am not going to put a price on sovereign capability.

REGIONAL SUPPORT

As a regional Member of Parliament, it’s a given that I’m going to do whatever I can to support our regional SMEs.

So I am very pleased that ODIS will have a dedicated regional SME support team.

I know there is so much more potential in regional Australia that needs to be unlocked, and I am determined to do this.

There will be seven staff in the regional SME support team to start with, and I have no doubt that if demand increases over the first 12 months, so too will the number of people in this team.

LOCATION LOCATION LOCATION

In my view, the CDIC did not treat industry as a true partner in the endeavour to equip the Australian Defence Force.

Each ODIS office will be co-located within a defence industry precinct within each state and territory to allow easy access for Defence businesses, Defence units and Defence industry associations.

They will be known as Mobile Defence Industry Hubs, and they will be in the thick of the action.

Exact locations haven’t been locked in yet, but it is quite possible that in WA, ODIS will be in Henderson.

In South Australia, perhaps Lot 14.

In Victoria, at Fisherman’s Bend.

I can assure you that ODIS staff will be right where the action is, as they should be.

TAILORED ADVICE

ODIS will have advisers in each State with specific Air Force, Army and Navy experience to provide specialist advice to businesses…

This will ensure they can adapt their development and opportunities to meet specific Defence capability requirements.

One of the issues identified in the CDIC Review was that it was reactive and didn’t provide advice tailored to that business at that moment in time.

With these changes, that will no longer be the case.

ODIS will be proactive, focusing on business growth, and it will be driven by the needs of Defence.

This will increase the competitiveness of SMEs, giving them the ability to easily integrate into supply chains and grow to become competitive defence providers in their own right.

ODIS will also have direct linkages to Defence procurement programs by identifying the needs of Defence capability managers and delivery groups.

ODIS will then use these requirements to identify current SMEs who can meet Defence needs in the short term.

As I have said many times, we need to take small business by the scruff of their neck and drag them through the door to take up those opportunities from our $270 billion investment in Defence capabilities.

PARTNERING WITH INDUSTRY ASSOCIATIONS

It will be standard practice for ODIS to partner with industry associations and registered training providers across the country to deliver ‘Defence Ready’ training and workshops to maximise our reach to all corners of Australia.

As some of you may recall, I announced in April that Defence would team up with HunterNet to deliver a pilot program aimed at helping local businesses in the Hunter get ‘Defence Ready’.

The pilot was offered to businesses free of charge and has provided vital information and education to help companies become defence ready.

The program has been so successful that it is my pleasure to announce today that we will double the number of funded places in it from 40 to 80.

This is testament to the remarkable interest we’ve had from businesses in the Hunter.

While the Defence Ready Pilot will end next June, the solution is clearer.

Through targeted partnerships like the one with HunterNet, Defence is able to engage with a broader group of businesses that are able to support the defence industry supply chain.

It is not easy for businesses to get ‘Defence Ready’ – nor should it be.

You need the right security practices in place, you need to know how to respond to Defence tenders, and you need to be able to compete on capability and have the capital to support your bids.

That’s why managing expectations is going to be so important – not everyone will be a winner.

But what we can do is partner with industry and educate SMEs on what is needed.

CONCLUSION

As I finish my remarks here today, I want to make it clear that ODIS must become the trusted link between Defence and industry.

So my message to the ODIS team is this…

You are now so much more than the front door for defence SMEs.

Your work is going to be critical if we are to truly develop sovereign capability among Australian SMEs that can meet the capability requirements of Defence.

Work with our industry stakeholders in partnership, develop those relationships with capability managers and primes…

And drag SMEs through the door to find them opportunities in our Defence programs.

My message to our esteemed industry stakeholders in the room is this…

Work with ODIS, share your ideas, identify opportunities and solve problems together, so that you can be well placed to help deliver our Defence capabilities.

My message to all the Service Chiefs and Group Heads is that I am keen for you to come back to me in the New Year with your plans and strategies for how you will utilise ODIS going forward.

ODIS is going to be your problem solver.

To Kate Cameron, the Head of ODIS and Fran Rush as the Head of AIC Division good luck!

It may sound like the world is on your shoulders, but I know you and the team will do well, and I can’t wait to work with you.

Thank you and have a great evening.

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