AIRMSHL Leo Davies - video transcript

Defence Innovation Hub Industry Update

AIRMSHL Leo Davies: Good morning and thanks very much for the opportunity. Many of you would have heard me speak before. And since this is the second iteration of this particular conference, I did note that it had three parts or three guidance. It’s the Defence Capability and Innovation Branch is putting on this event-- Defence Innovation Hub industry update. So I’m suspecting in there some way that you’re going to want an update-- maybe not.

A Defence Innovation Hub conference-- so that means there’s an opportunity for presenters to present and for you to ask questions. So rather than use the speech that was provided to me, I’ve just got a few points on a couple of cards. I’m not going to take my whole 25 minutes and leave about 15, hopefully, for you to ask me what I think, which I hope is what you are after from me.

But what I did notice is on the nine pages of about 45 companies that are represented here, there were a majority of them that I had no idea existed. And in one sense, that’s really good. And that’s probably what I’m trying to cover here in my 10 minutes is innovation is happening, and I don’t know it.

Is that a bad thing? I don’t think so, but I would through this day encourage you all – industry, those part of the Innovation Hub, those that are using what innovation will bring in a Defence context, I would like to see our awareness expand. And I think that is one of the parts that’s missing.

So I noticed a couple of companies here or groups – SOAPdrones, Raging Digital, Anomaly, Blue Glue, [? Arado ?], synth, Trellis Data, SAGE Automation. So why is it that the Chief of Air Force or any other capability manager don’t know that those companies exist or don’t know what it is they might bring to me as a capability manager. And for me, that is a real important part of what Innovation Hub is doing. White paper, the strategic reform program, industry as a fundamental input to capability-- all significant changes but we’ve kind of been here before.

Anyone not heard of RPDE? Did that work? Kind of – and it was the start.

So in my view, we’ve all been on this journey for a little while. So this is not about innovation and what innovation brings – and I’ll be a bit narrow here during my presentation, as I’m sure Chief of Army will be later on in the morning – in an air context, we’ve been on this journey for a little while. It is a bit like expecting that because we said it, we are now industry, a fundamental input to capability. We said that on Friday. What do we expect on Monday? And I would offer the view, Leo’s view, that we expected a whole bunch more than we were able to deliver.

There was a thought that having said it, we’re going to innovate. We’re going to have a hub. We’re going to have billions of dollars spent on innovating. Why didn’t that happen over the weekend? Why can’t we do all that we aspire to do on Monday?

And I liken it somewhat to the journey Defence has been on, and that is around making joint by design a fundamental start point. I have said before many times, we used to think we were joint, but we were not. We just threw a J in front of an already existing acronym and thought we were. So we are not yet, I don’t think, and what I feel, and some of those companies I read out, businesses I read out-- we are only at the very beginning of the innovation journey.

So my expectation at the moment is that we will see modest growth, but we’ll see an increasing complexity, an increasing rate of change. And that, to me, is a cultural shift. That is an adaption, if you like, like we did through joint and in a really simplistic sense, like it was back in the ‘60s when we were told we had to wear seat belts.

What I know and what I want. What I absolutely see is time is of the essence, not just today or tomorrow but in our ability to generate what I need for the Air Force as part of a joint fighting outfit. The time I’ve got to get it, whatever it might be, is getting shorter. What’s the average, for the last couple of decades at least, time for Air Force to deliver a project? Seven years, eight? I don’t think anyone in the room is saying two. Why is that?

And part of that, in my view, is because we were quite risk averse. We were risk averse from an industry point of view is how much do I invest to be able to get a reward for my investment and shareholders? From a uniform point of view, I can’t afford failure. This project has to work. What we’re talking about here in an innovation context is exactly the opposite. We want to find out whether it’s going to work really quickly, and I’m quite happy to invest in finding out really quickly. That is a paradigm shift, and one that we have not adjusted to just yet.

Plan Jericho – Jeff Brown, previous chief of Air Force, started Plan Jericho, and we have continued over the last four years or so in trying to get Air Force culture to accept what an innovation inspired opportunity will present.

So the fundamental of Jericho is in two parts, but one of them is connect a few more green wires-- the device, the radio. The way we were connected can become more connected through Jericho. That’s one part that’s technical, that’s practical, and really is what’s on the screen. How do we connect all those bits because that is the Air Force transitioning? That is the single biggest Air Force transition in our 97-year history. But I don’t really care too much about the metal-- that’s pretty straightforward.

How do I get each of those to talk to every other one of those? And when I say talk, it’s not about radio. It’s about data. It’s about speed. It’s about time. It’s about security.

Outside of that, how do I get that to talk to the Army’s battle management system or the future frigate, air warfare destroyer? How do I get those integrated? And at the moment, on a traditional path without innovation, we never will because I’ll be retiring the first one of those, the C27J will come off that map first, and it will be gone before it’s innovated to be able to connect to the rest of Air Force.

A bit of a negative or an observation at least-- I can use-- for those that are aware of it-- air 6500 as the project that I can talk around here. It is a real opportunity, but I still get the sense that both industry and uniform-- industry and Defence-- are not quite aligned.

I still get a fairly strong view of whichever company I am talking to, you need one of what I’ve got. And on the other side of the fence, you are still getting from industry, from uniform, from Air Force to industry, but I want version two of what I’ve already got. I just want it to go a bit further, a bit faster because we can’t see what the opportunity would be if we were to innovate. And those two cultures, at the moment, to me are still a little bit apart.

I would hope that this sort of conference, this ability to engage with industry and have the conversation, I hope some questions later would offer the opportunity for us to narrow that gap. But as I said earlier, it might take a year or two from here. I had a comment on the bottom of the card. I’ll use it because it does fit sort of in that last comment.

Your shareholders have a real say in how you conduct your business. My shareholder, at times, is the enemy. So if they are moving faster, than we can move, I’m going to need some help in keeping up, and I think that speed piece is where you play a big part.

So what are some of the things that are on my mind to give you a thought of what is or what might be a priority in the Innovation Hub? So I’ll be quite blunt here for a second. I don’t know what the priorities are in the Innovation Hub. Is that bad? I don’t know.

Drones-- they’re coming. They’re already here. Don’t like the term drones, actually. Unmanned aerial systems, remotely piloted aircraft-- happy with those.

But we seem to have lost the drone conversation. Anyway, we’re developing them. They’ll be delivering pizzas if they’re not already.

But how do we fight a drone? How do we defend against it? And if you don’t think that’s real, drones, remotely piloted aircraft are dropping weapons on civilian populations by ISIS today. How do you stop them? And what is the innovation pace or the way we would go about defending ourselves that would have a counter drone opportunity and is anyone working on that? I don’t know.

What about information sharing? We talk about it a lot, the ability to share either a single one or zero or a collection of a picture, an electronic warfare signature, a signal intelligence data set. How do I share that? And how do I share it in a fifth-generation context?

This is going to be really ugly because I’m going to bare my lack of engineering and sophistication here. But if I’ve got a radio that’s tuned to a particular frequency band, I can’t hear anything else-- only in that frequency band. So that’s a pretty simple example. But if you’re going to go to something as sophisticated as F-35, it’s not just the frequency band. It’s the source.

It’s the way it’s written. It is a complicated data set. How do I pass that to someone who doesn’t have F-35?

And I’ll flow that across the entire Air Force programme. How do I share that with a neighbour without declaring that we have a security element to that particular data set? How do we manage up and down scalable? And I don’t think we have an answer for that yet, but I’d certainly like to work on it.

Speed-- at the moment, we are relying on largely weeks for data information to flow. We are working on days. Chief of Air Force’s view is it needs to be in seconds and minutes.

And if it’s not, the enemy will have a vote because they will have already made that decision, and we will lose. It doesn’t mean necessarily that we will lose aircraft or people, but we won’t be able to accomplish the mission. We’ll have to come back tomorrow, and tomorrow might look quite different.

So as a context setter-- and the last piece of my presentation before I take any questions-- think of project X, whatever that might be. So how would that project look if Defence had unlimited dollars? How would you design project X if I could offer you unlimited budget to research, innovate, and deliver?

Same project, different context-- what if it didn’t matter how much profit you made or whether it actually worked or not? What would project X look like with that lens? And then ask yourself, for that same project, what if we swap places?

What if you sat in the chief of Air Force’s chair and said this is what I need for project X? What would the options set, what would the solution set look like if you had my lens and not an industry lens? I think there’s a little bit of work for us to go.

And my last point-- I think we have some decisions still to make or some room to move in terms of the Innovation Hub itself. Should industry set the tone by providing a plethora of innovative ideas and options-- hundreds, thousands-- and then Defence chooses which ones of those we would like to adopt? Or does Defence set the priorities and say this is where we want you to innovate and you are restricted to those particular priorities? Which is the better outcome or is it a mix?

Thanks for your time, ladies and gents. I’ll take your questions.

Master of ceremonies: Ladies and gentlemen, while I put the questions up, please thank Chief of Air Force Air Marshal Leo Davies.

[APPLAUSE]

AIRMSHL Leo Davies: I did stick to the under 10 minutes. Please.

Question: Thank you very much that was informative. You mentioned the word “enemy” a few times. Could you define what, who is the enemy, please?

AIRMSHL Leo Davies: How I would describe the enemy is growing by the week. We would traditionally have thought of the enemy during World War II as the Germans or the Japanese. That is not the case at the moment. The enemy is anyone who would attempt to change the way Australians would expect to live their life-- somebody who would want to either do harm to us or influence Australia in a way that is undesirable by Australians.

So enemies aren’t necessarily those that would provide a kinetic effect. ISIS is an enemy.

Master of ceremonies: Ask people to please use the Slido app so we can get all the questions compiled, and we will attempt to answer as many as possible.

Question: [INAUDIBLE] would that include your manufacturing base?

AIRMSHL Leo Davies: Absolutely, absolutely.

Question: [? Does that include ?] the damage that’s being done right now?

AIRMSHL Leo Davies: So the questions are linked here. One of the security elements-- that sounds really bad, doesn’t it? The reverb. But one of the real elements here about an enemy is what happens to the spare part on the F-35 that is hacked with one single element changed that when it gets fitted, the F-35 said, sorry, this is not the real part, and I’m not going flying today.

Question: So you mentioned before in your discussion with the Air 6500 Integrated Air and Missile Defence for Australia, you talked about Defence and industry being divergent or not being on the same page. Are you talking more in terms of industries, especially the big primes inability to collaborate, or are you talking about the industry primes and ability to innovate? Or is it a connection between the two?

AIRMSHL Leo Davies: Both. So Leo’s view IP is the killer of conversation. If I got the primes in my conference room and said you tell me what the solution is for Air 6500, I would want a single answer or at least a very narrowed option set but that’s not what I got. I got a prime A answer, a prime B answer, a prime C answer, and a prime D answer, and there is no way any of the other three could possibly be the solution.

That’s not just industry’s issue. This is Air Force’s problem because we didn’t define the options set or the requirements set clearly enough. So there’s more conversation to happen. But I’m saying in the context of innovation and a modern way of doing our business, we are still-- actually, I disagree. It’s not divergent. It is convergent, but we started apart.

Question: So my question goes back to your closing comments, I suppose. And conversely, great presentation. I enjoyed the specific nature of the [INAUDIBLE]. The concern I have at the moment is that if you, as one of our core capability managers, is unaware of the priorities of the Defence Innovation Hub, how then can we be prioritising operational outcomes for the ADF through the Innovation Hub? Minister Pyne in an earlier conference said in the first 18 months, we will have spent $68 million standing up the Innovation Hub. What wasn’t able to be answered is how much of that had actually transitioned into operational capability for warfighting [INAUDIBLE].

AIRMSHL Leo Davies: Sure, in this job, I’ve learned at least one thing. That is I don’t need to be a part of every decision that Air Force makes. There are some really talented young airmen and airwomen in the Royal Australian Air Force.

So in a true acceptance of a risk profile that says, if you’re a one star and have a really good idea, then it’s likely over time, the priorities that Air Force would ask the Innovation Hub to consider will be taken care of. Leo’s twenty cents’ worth, and I might adjust it a little bit, but I don’t feel like I need to be there every time we have a prioritisation function in the innovation hub. But I would like to have more visibility of those priorities and how they are indeed coming to fruition.

One bit of this though is if we were truly bold in an Innovation Hub context, what if none of them came to fruition? What if we spent $100 million and got zip? We would have five years ago considered that to be a fail. That might just be $100 million spent to save a couple of billion dollars later. So at the moment, I am holding the view, and I’m asking Air Force to hold the view that spending money in Innovation Hub and not getting a result is OK.

Question: Air marshal-- building on that question, Force Design sets the priorities for the Innovation Hub. But for Air Force specifically, what do you see are the priorities?

AIRMSHL Leo Davies: I mentioned a couple of them, but the real win for Air Force is going to be fidelity and speed of data transfer. It’s going to be information – ability to make a decision faster than the enemy. And at the moment, we are still restricted by the way we transfer, the mechanisms for transfer, and the acceptance, if you like, of that data. We started in what I would regard as a federated data framework, and it needs to be integrated.

So we have a couple of things linked here. That is the way a company X generates an electronic warfare data package, and I try and ingest that into company B’s machine-- not happening because we grew up in a Federated stovepipe environment. We still have legacy systems that function that way. So that’s my priority.

Master of ceremonies: Ladies and gentlemen, please thank Chief of Air Force Air Marshal Leo Davies.

AIRMSHL Leo Davies: Thank you.

[APPLAUSE]

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