The value of agility

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The use of Projective Analysis (PAN) modeling tools to establish the value of increased agility in responding to increasingly multi-sided demands being made on operational capabilities. The approach addresses the need to reduce cohesion costs by creating economies of alignment as well as economies of scale and scope.

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The value of agility

  1. 1. The Value of Agility Philip Boxer BSc MBA PhD September 21st 2013 . Copyright © BRL 2013 1
  2. 2. Contents • The Study – Objective – Design – Conclusions • The End-to-End Process – Demand Analysis – Structure Modeling – Analyzing Value for Defence • Next Steps . Copyright © BRL 2013 2
  3. 3. THE STUDY . Copyright © BRL 2013 3
  4. 4. Study Objective Scope – Surface fleet with a variety of vignettes spanning the full range of concurrent mission types and capability space Objective – Pilot an approach that can answer what reconfiguration of the existing surface capability would maximize the effectiveness of the existing surface capability within budgetary constraints Assumption – That the effectiveness of given configurations of Force Element in particular Mission Situations can be provided as input to the study Limitation – Very limited availability of data on architecture of Information Superiority Capabilities and their costs . Copyright © BRL 2013 4
  5. 5. Study Design • Preparation – • – – – • – • Write a report that articulates the use of the projective analysis method and application of PAN tools, and summarizes the results of the modeling and analysis – – – • We chose a large-scale scope for the end-toend process. Study – Collect and capture relevant data using a matrix that represents the multi-sided demands being made on operational capabilities Develop the appropriate modeling approach (planning the appropriate use of PAN tools best suited for the selected capability subset) for both the baseline data and proposed variations Develop models and analyze their architectural properties, including costs Identify options and provide associated economic analysis using the projective analysis method and PAN tools Closure Preparation – Define and document the scope of the pilot project Study – • Dominated by need to develop additional non-warfighting vignettes and to collate data into data templates. Availability of data very limited. Insufficient time gap between workshop developing vignettes and the modeling workshop, compounding the data problem. We might have added a C4ISTAR SME*, but chose to go for 1st approximation. The models had limited detail on the Alignment Processes and their costs, which limited analysis of stratification. A workaround was used on alignment costs. The savings identified were too large, having understated alignment costs and overstated the variation in costs of use. Closure – The end-to-end process was completed, gaps in data were identified, and a 1st approximation result obtained. * SME – Subject-matter Expert . Copyright © BRL 2013 5
  6. 6. Study Conclusions • Surface Fleet capabilities are confronted with an increasing proportion of mission situations in which Force Elements need to collaborate in changing or unpredictable ways. • Maximising effectiveness within budgetary constraints requires changes to the architectures of both Force Elements and Alignment Processes. • A modular approach using corvettes and fleet auxiliaries with corresponding changes to C4ISTAR capabilities shows an average saving of 35-45% on the force’s total operational costs of cohesion, which increases to 40-50% when taking into account the value of the reduced variation in these costs . Copyright © BRL 2013 6
  7. 7. END-TO-END PROCESS . Copyright © BRL 2013 7
  8. 8. Process Steps 1: Demand Analysis – Describe the variety of demands, defined in terms of the differing nature of the Alignment Processes needed to produce cohesive responses to this variety 2: Structure Modeling – Identify the architecture of the Force Elements and Alignment Processes 3: Analysing Value for Defence – Identify the costs of these architectures and any proposed changes, and value their impact on the cohesion costs across the variety of demands identified . Copyright © BRL 2013 8
  9. 9. 1: DEMAND ANALYSIS . Copyright © BRL 2013 9
  10. 10. Through-Life Capability Management (TLCM) • The UK MoD is engaged in a major change programme to evolve its acquisition processes – Since 2005 publication of the Defence Industrial Strategy (DIS), the UK MOD has been evolving its acquisition process to implement the processes, infrastructure and culture to deliver Through Life Capability Management (TLCM) • • TLCM is defined as: “…an approach to the acquisition and in-service management of military capability in which every aspect of new and existing military capability is planned and managed coherently across all Defence Lines of Development (DLoDs) from cradle to grave.” TLCM faces a challenge in the way it delivers a double agility: – Agility in the acquisition of new equipment capabilities and fielding them across the DLoDs, and – Agility in the operational responsiveness of fielded forces to rapidly changing and asymmetric forms of threat. . Copyright © BRL 2013 10
  11. 11. Agility • • The operational agility of a Joint Capability Package is the variety of capabilities that it can generate at campaign tempo. The acquisition agility of a supplier is the variety of Force Elements that it can provide at acquisition tempo. Demand for operational capabilities at demand/threat tempo Threat Physical Environment Coalition Contribution Capability Alignment Processes orchestrating and synchronizing the use of Force Elements at alignment tempo Audit Process Joint Capability Packages Force Elements Training Logistics Equipment Infrastructure Personnel Information Organisation Demand for Force Elements at acquisition tempo Doctrine http://www.aof.mod.uk/aofcontent/operational/business/capabilitymanagement/capabilitymanagement_whatis.htm . Copyright © BRL 2013 11
  12. 12. The demand for multi-sidedness • • The demand for operational agility creates a demand for multi-sidedness in the way a Force Element can be used. The multi-sidedness of the demands on a Force Element is the variety of different forms of collaboration* demanded of it. Current focus Threat met by use of single Force Element: a few very capable vessels Inter-State Conflict Force Elements X X Variety of Mission Situations X X X Non-inter-state Conflict X X 1 * Geometries-of-use . Threat met by composition of many Force Elements: different types of vessel and capability able to work collaboratively 2 3 Force Elements purpose built to meet most demanding threats 5 X X 4 X X X X 6 7 Defence trend X X 8 9 10 Force Elements built to meet a variety of threats through working together collaboratively Copyright © BRL 2013 12
  13. 13. Variety of demands across Campaign Types • • The larger proportion of operational time was spent in the top-right quadrant. The trend across the whole range of Campaign Types is towards the pursuit of greater asymmetry and therefore increasing variety. 1 13. Humanitarian assistance & distaster relief .95 Concurrent Campaign Types (aka Defence Operations) OR .05 AND Standing Overseas Commitments OR .25 .25 .5 Limited duration SS (MS) Power Projection Limited duration SS (MS) Peace enforcement .95 Limited duration SS (MS) focused intervention OR Enduring medium scale Military Assistance to Stabilisation & Development Enduring Medium Scale peacekeeping .2 .8 Enduring small scale PP 1 1 Enduring small scale PK 1 One-off large scale deliberate intervention 14. Counter Piracy 1 AND OR .05 many 1 1 14. Counter Piracy 9-10. CounterDrug Operation Number of managerially and operationally independent Actors 5-8. Noncombatant evacuation 11. Mine & obstacle countermeasures 3. Anti-Surface Warfare 2. Anti-Air Warfare 4. Antisubmarine Warfare 12. Ship to objective manoeuvre 1. Littoral Land Attack 11. Mine & obstacle counter-measures 3. AntiSurface Warfare 5-8. Noncombatant evacuation A vignette A scenario/effects ladder relates each vignette to its larger Campaign context 20% 13. Humanitarian assistance & disaster relief 12. Ship to objective manoeuvre 1. Littoral Land Attack 2. Anti-Air Warfare few 70% 9-10 CounterDrug Operation Insertion, reconnaissance, ISTAR 4. Antisubmarine Warfare 10% low high Variety of different types of Mission Situation* * Variety of geometries-of-use . Copyright © BRL 2013 13
  14. 14. 2: STRUCTURE MODELING . Copyright © BRL 2013 14
  15. 15. Current Approach • The MoD’s acquisition focus has been on the Force Elements capable of countering the most demanding threats, encountered primarily in inter-state conflicts. – The acquisition and deployment of a Force Element includes its systems-of-systems that can be assumed to reside under a single operational1 and managerial2 authority. – The costs of operational use are established through activity-based costing, focusing on the costs across the DLoDs that directly contribute to the operational use of the Force Element. • The costs of aligning the use of multiple Force Elements to the demands of particular mission situations either remains implicit in the use of particular Force Elements, or belongs to another type of enabling Force Element providing the capability for Information Superiority (viz CCII and ISTAR). – Capability acquisition is silo’d 1 Authority over 2 the way the Force Element is used as a part of an operationally deployed Force Package. Authority over the way the Force Element is made available for use by operational authority. . Copyright © BRL 2013 15
  16. 16. High-level capability Capabilities that a Force Element is built to create by acting together with others The Force Element is designed to operate within a Task Force with its own CCII, such that the Task Force can act like a single Force Element Alignment dependent on endo-systems Directed SoS: CCII architecture Starconnected Cost of operational use of the capability 2 Corvette Capabilities that a Force Element is built to create acting alone 1 2 . Alignment dependent on exo-systems 3 Surface combatant Collaborative SoS: CCII architecture fully networked ‘Containers on Fleet Auxiliaries’ Aircraft carrier 1 Interoperability Risks Capabilities are created that are independent of the platforms on which they are deployed A subset of capabilities can be deployed that are more dependent on exo-systems endo-system – systems-of-systems that are endogenous to the Force Element exo-system – systems-of-systems that are exogenous to the Force Element Copyright © BRL 2013 16
  17. 17. Current focus Changing Architecture in response to increasing multi-sidedness Threat met by use of single Force Element: a few very capable vessels Inter-State Conflict Force Elements X Variety of Mission Situations • Threat met by composition of many Force Elements: different types of vessel and capability able to work collaboratively X X X X Non-inter-state Conflict X X 1 2 3 Force Elements purpose built to meet most demanding threats 4 X X X X X 5 X 6 7 Defence trend X X 8 9 10 Force Elements built to meet a variety of threats through working together collaboratively Proposed changes in architecture introduce: – Increased modularity of Force Elements – Increased reliance on exogenous systems-of-systems • Value for Defence is ability to meet variety of Mission Situations across range of Campaign Types at reduced cost – Value of changes depends on specific nature of variety Reduced costs of Alignment Systems of Systems exogenous to Force Element Alignment Process Architecture 1 Architecture 2 Force Element Equipment capability . Systems of Systems endogenous to Force Element Reduced cost of Force Elements Copyright © BRL 2013 17
  18. 18. Balancing acquisition and operational agility • Balancing these two forms of agility and their corresponding costs involves spanning a number of different layers of organization. Institutional Forces Suppliers Theatre Command Skills, Assets & Equipment Fielded assets & equipment Force Elements 1 2 Composite operational capabilities 3 Acquisition agility, generating operationally available capabilities across the DLoDs Acquisition Tempo . Mission Command Operational Forces 4 Mission synchronization Scenario Effects 5 6 Operational agility, aligning composite operational capabilities to mission demands Alignment Tempo Demand/ Threat Tempo Copyright © BRL 2013 18
  19. 19. Modeling Approach • Projective analysis is an approach to modeling and analyzing the relationships across all six layers Domain of interactions: using surface assets Organization of TEPIDOIL generating Force Elements 2,3 Organization 1 Realization Skills, Assets, Equipment & Platforms Supporting organizations and infrastructures 4,5 Orchestration of Operational Capabilities & Mission Synchronization Analyzing multi-sidedness Supply-side Demand-side Skills, Assets, Equipment & Platforms Fielded Assets, Equipment & Platforms Force Elements 1 2 3 Acquisition Tempo . Effects Ladders Effects within Mission Types across Campaign Types 6 Operational capabilities 4 Alignment Tempo Mission synchronization Effects 5 6 Demand/ Threat Tempo Copyright © BRL 2013 19
  20. 20. Structure Modeling Accountability Hierarchies Demand Domain of interactions: using surface assets Circular Dependencies Organization Organization of TEPIDOIL generating Force Elements 2,3 1 Realization Skills, Assets, Equipment & Platforms Effects within Mission Types across Campaign Types 6 4,5 Orchestration of Operational Capabilities & Mission Synchronization Supply-side Demand-side Social & Data Synchronisation Structure & Function of physical and digital systems . Copyright © BRL 2013 20
  21. 21. Architectural Analysis of Stratification • • Analyzing the Alignment Processes separately from the individual capabilities showed the relative complexity of these processes in the vignettes placed in the top-right quadrant of the capability space. The delta architecture introduced modularity into both the Force Elements generated and the Alignment Processes. * top-right quadrant in the capability space Layers 4-6: Complexity of Alignment Processes Hi Lo V1 - Littoral land attack Hi Layers 1-3: Complexity of Force Generation Lo V11 - Clearance of landing beach V12 - Ship to objective manoeuver V2 - Anti-air warfare V4 - Anti-submarine warfare V13 - Disaster Relief* Modeling of basic relationships . V3 - anti-surface warfare V5-8 Non-combatant evacuation* V14 - Counter-piracy interdiction* V9 - Ship stop and search* V10 - Interdiction of gofasts* Analysis of patterns of Alignment Copyright © BRL 2013 21
  22. 22. 3: ANALYSING VALUE FOR DEFENCE . Copyright © BRL 2013 22
  23. 23. Cohesion Costing • A different costing model is needed to identify the total operational costs of responding to particular types of mission situation – cohesion costing. – Cohesion costing combines the costs of use of particular Force Elements with the costs of aligning their use in combination in relation to particular types of mission situation. Costs of Cohesion Costs of use Costs of alignment Skills, Assets & Equipment Fielded assets & equipment Force Elements 1 2 3 Acquisition Tempo . Composite operational capabilities 4 Alignment Tempo Mission synchronization Scenario Effects 5 6 Demand/ Threat Tempo Copyright © BRL 2013 23
  24. 24. Analysis of Value for Defence • • The value of an architectural change is the impact of both the reduced average and the reduced variation* ‘Real Option’ pricing allows a value to be assigned to the change in spread/variance The total operational cost of approach ‘b’ across the variety of scenarios Value for Defence from: 1. Reduction in average level of defence expenditure through impact of trade. 2. Change in spread/variance in levels of defence expenditure, based on the difference between the two curves ‘a’ and ‘b’ b a’b’ a The total operational cost of approach ‘a’ across the variety of scenarios Probability Levels of total operational expenditure on Concurrent Campaigns * Agility = property of the force package enabling it to do more things with the same underlying capability set. . Copyright © BRL 2013 24
  25. 25. Value to be captured by Terms-of-Business Agreement (ToBA) TLCM+: Through life management of (collaborative system-of-system-based) capability ToBA provider purchaser TLAM/TLCM: Through life management of (equipment-based) capability Purchaser-provider boundary defining value for defence provider purchaser Smart: Acquisition of equipment or platform spanning its life-cycle provider purchaser Skills, Assets & Equipment Fielded assets & equipment Force Elements 1 2 3 . Composite operational capabilities 4 Mission synchronization Effects 5 6 Copyright © BRL 2013 25
  26. 26. END-TO-END PROCESS CONT’D . Copyright © BRL 2013 26
  27. 27. End-to-end Process Capability Space: SMEs What variety of vignettes? campaign effects strategic context Relative frequency & duration of vignettes Effects Ladders: Campaign context to vignettes Vignettes: external events existing mission threads SMEs .kbs Stratification analysis: layers of alignment base model larger impact of changes alternative architecture(s) Monte Carlo distributions structure, orchestration & synchronization FE architecture, threads & internal/ external events Delta surface architecture: Vignette occurrence: Modeling effects generation: Data Templates: base case stratification Modeling delta: SMEs Cohesion costing templates: delta structure, orchestration & synchronization 5-layer analysis .xls Costings: SME* Workshops SME* sourcing of data Analysis Mission type occurrence: L/M/H confidence costs SMEs Base & Delta Costings: Cohesion costing for each vignette Costs delta & Variations: variation in total annual costs Present Value of savings: long term impact of delta architecture Real option valuation: Additional value of reducing variation * Subject-matter Experts (SME’s) used to overcome limitations in data currently available . Copyright © BRL 2013 27
  28. 28. Results from End-to-End Process many 14. Counter Piracy Number of managerially and operationally independent Actors 3. Anti-Surface Warfare 13. Humanitarian assistance & disaster relief 12. Ship to objective manoeuvre 1. Littoral Land Attack 2. Anti-Air Warfare 20% few Insertion, reconnaissance, ISTAR 4. Antisubmarine Warfare 10% low high Variety of different types of Mission Situation A Peak Z-axis: ‘Number of overlapping Orchestrations X-axis: Orchestrations of Force Elements 2. Complexity of supporting multisidedness Layers 4-6: Complexity of Alignment Processes * top-right quadrant in the capability space Hi Lo V1 - Littoral land attack V11 - Clearance of landing beach Hi V3 - anti-surface warfare V5-8 Non-combatant evacuation* V14 - Counter-piracy interdiction* V12 - Ship to objective manoeuver Layers 1-3: Complexity of Force Generation V2 - Anti-air warfare V9 - Ship stop and search* V10 - Interdiction of gofasts* V4 - Anti-submarine Lo warfare V13 - Disaster Relief* – There needs to be less redundancy in the provision of capabilities by Force Elements combined with a greater focus on the Alignment Processes per se. Variation in monthly costs per vignette 6.0 5.0 4.0 ACU ,000/month 3.0 2.0 1.0 V13 - Disaster Relief V9 - Ship stop and search V2 - Anti-air warfare V1 - Littoral land attack V3 - anti-surface warfare V12 - Ship to objective … base cohesion costing 0.0 V4 - Anti-submarine warfare What are the consequences of this multi-sidedness for engineering architecture of Force Elements and Alignment Processes? V5-8 Non-combatant evacuation • 3. Complexity of 2 agilities 4. Costs per vignette delta cohesion costing V14 - Counter-piracy interdiction – Significant multi-sidedness met by separate complex starconnected orchestrations of Force Element Jagged complex star-connected orchestrations Y-axis: Number of Force Elements needing to interoperate for this Orchestration V10 - Interdiction of go-fasts What is the level of multi-sidedness created by the current variety of demands? 1. Variety of demands V11 - Clearance of landing beach • 70% 9-10 CounterDrug Operation 5-8. Noncombatant evacuation 11. Mine & obstacle countermeasures hybrid delta cohesion costing Normalized probabilities of duration by vignette 1.00 0.80 V1 littoral land attack 0.60 V11-12 Ship to objective V13 Humanitarian assistance & disaster relief probability V14 Counter Piracy 0.40 V2 anti-air warfare V3 anti-surface warfare V4 anti-submarine warfare 0.20 V5-8 Non-combatant evacuation V9-10 Counter-Drug Operation 0.00 0 2 4 6 -0.20 8 10 12 14 months/year 5. Variation in vignette duration Average Annual Savings by Mission Type 30 25 20 ACU ,000 15 – A modular approach shows an average saving of 35-45% on the force’s total operational costs of cohesion, which is increased to 40-50% through reduced variation . 10 5 Limited Duration SS/MS PP (9) Limited duration SS/MS FI (7) Limited duration SS/MS PE (8) Enduring SS PP (4) Enduring MS PK (5) Enduring MS Military assistance (6) One-off LS DI 0 Enduring SS PK What are the expected savings when implications are successfully met? Standing Overseas Commitments • 6. Savings per vignette Normalized costs Normalized savings 0.4 0.40 0.35 0.35 0.3 0.30 0.25 0.2 0.15 0.1 0.25 probability 0.20 base 0.15 delta 0.10 0.05 0.05 0 0 100 200 ACU ,000 300 400 -0.05 0.00 -100 -50 0 50 100 150 ACU ,000 7. Changes in cost variation Copyright © BRL 2013 28 200 -0.05 probability
  29. 29. NEXT STEPS . Copyright © BRL 2013 29
  30. 30. Next Steps • • Given the potential impact of the approach for the MoD, a first step must be creating more awareness within that organization of this level of analysis Therefore, it is strongly recommended organizing a 1-day workshop for key people involved in strategy – What is multi-sidedness and how does it impact the MoD’s approach to generating capability? – What is necessary to increased effectiveness in an environment of increasingly multisided demands? – What were the results of this pilot study? • After this, next steps can be defined, for instance – To repeat the study with a refined scope and more solid data – To identify the consequences and next steps for the MoD – To identify the consequences and next steps for ToBA . Copyright © BRL 2013 30
  31. 31. END . Copyright © BRL 2013 31

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