Case Study National Shipbuilding Procurement Strategy

Question: Discuss about theCase Studyfor National Shipbuilding Procurement Strategy. Answer: The National Shipbuilding Procurement Strategy (NSPS) The national procurement strategy for shipbuilding is a government implemented strategic program of Canada to restructure the fleets those comprise the Royal Navy department of the nation. The shipbuilding strategy has been initialized in the year 2010 through the government commitment to procure potential equipment and applicable job profiles for the Coast guard and Royal Navy division of Canada (Sloan, 2015). The reason behind Canadian Governments decision to optimize this strategy is the shipbuilding industry of Canada has gained no significant substantial growth from 1990 to 2010. The Canadian government believes that no profitable orders for constructing vessels have been received in between the years of 1990 to 2010 (Lerhe, 2013). Consequently, it has been seen that in comparison with other powerful countries of the world, Canada lacks in equipment access. Alongside, most of the workers of Canadian shipyards used to have lack of proper skill and supply lines found poorly manage d. Hence, the Canadian government felt the dire necessity to develop a long-term plan to support and revitalize the vessel constructing department and Coast guard of Canada, which will be sustainable at the same time. Considering the necessity of both large and small vessels and the need to implement a strong maintenance and repair subdivision, the strategy of shipbuilding procurement is designed to have three different frame works. These Fundamentally, NSPS is the part of The National Shipbuilding strategy (NSS), which on the same side is a long-term and sustainable plan of Canadian government for renewing those vessels, which are used for both combat and non-combat purposes. It is important to note that, the government of Canada tied their knot two leading Shipyards Shipyard of Halifax and Vancouver Shipyard of Seaspan (McCoy, 2015). However, the decision to revitalize the federal fleet of Canada has been enthused by the strategic decision to rebuild the shipbuilding industry take in the year 2006. However, the government set five specific goals for NSPS concerning the requirement for shipbuilding sector. The goals include a) reconstructing the department of Federal vessels, b) Maximise the value of the Taxpayers and the increase the sale of this specific industry, c) Form a long term strategic bond with Shipyard of Halifax and Vancouver Shipyard of Seaspan, d) Optimizing commitments for Value proposition and e) f inally strengthen the shipbuilding sector of Canada (Sloan, 2015). However, these goals frequently observed two giant constraints, which are inadequate budget for such a huge project and poor program management. It is unfortunate that no serious measurement have been taken to strongly confront these risks. In addition, it has been predicted that these two risks have opened the door for new risks those could make harmful footprint on aspects such as innovation and technology advancement. The Value Proposition The aspect of value proposition associated with the commitment of NSS regarding the shipyards of long vessels has been proposed to give greater benefits to the marine industry of Canada. The value proposition have been established based on three individual anticipation which are to develop human resources or the work force, make fruitful investment for technical advancement and finally development of the industry. Instead of the fact that the shipbuilding strategy has been initially offered to build ships and to reconstruct the navy department, NSPS has been proposed to revitalize the economic growth of the nation by maximising the value for the taxpayers and foster industrial development by technology advancement by implementing DPS (Defence Procurement strategy) and Industrial and Regional Benefit (IRB) (Stone, 2015). Sector growth As a consequence of IRB, the large vessel program has contributed gross domestic product worth of $4.4 billion and from the year 2012 5,500 job vacancies have been created. However, it is shocking that the defence strategy taken through NSPS still does not seem supportive for the industrial base. According to most of the regional and industrial organizations argued and complained that the procurement strategy has done nothing fruitful as they are excluded from foreign contracts (Gilmour, 2014). Additionally, there is lack of support from the federal government for the domestic enterprises to become the first buyers in comparison with other foreign companies. Supplier Development The economic benefits in terms of the suppliers from the NSPS have been reflected through the success of the regional and industrial suppliers all over the nation. Under the program of IRB, 100% contract value is given to the Canadian business due to which each year Canadian export manufacturing enterprises acquire orders worth of $20 million. From the year 2012 to 2015, near about 492 suppliers have received contracts worth of $1.3 billion and an estimated amount of $355 million has been provided to the suppliers of medium to small sized enterprises (Vucetic, 2016). On the other hand, over $21 million worth of contracts have been given to the suppliers of indigenous background. Research and Developments (R D) Canadas safety and Security program established by the Defence research which is led by the DPS has been forwarding the growth of research and development process. The Development Canada along with Defence research has announced 20 new science projects and has taken part in the $14.5 billion investment program for safety and security, taken by the DPS. It is to be noted that the growth in R D would not have been possible without the implementation of NSPS as DPS is one of the major part of the ship procurement strategy (Auger, 2016). The new RD projects led by DPS include increasing surveillance capabilities, development of PPE (Personal Protective Equipment) and development of internet mapping and other efficient alerting services for the public. Exports With the hand of NSPS Canadas export industry has contributed near about 49% of the entire sell in the year 2012. As a result of the Value proposition of NSPS, Ontario would be the leading regime for export potential in Canada (ic.gc.ca, 2014). Through the implementation of International export strategy, the value proposition has implanted the incremental capacity of the exporters. The strategies to strengthen the potentialities of the suppliers are Identifying the target market Identify risks and mitigate them Point out approach for market entry Analyse the competitive advantages of the bidders. References Auger, M. (2016).The Evolution of Defence Procurement in Canada. Library of Parliament. https://www.lop.parl.gc.ca/Content/LOP/ResearchPublications/2016-09-e.pdf Gilmour, J. (2014). Canadian Defence SpendingA Case Study of Mismanagement.Journal of Military and Strategic Studies,15(2). https://jmss.journalhosting.ucalgary.ca/jmss/index.php/jmss/article/view/535/522 Lerhe, E. J. (2013).The National Shipbuilding Procurement Strategy: An Update. Canadian Defence Foreign Affairs Institute. https://cdfai.org.previewmysite.com/PDF/The%20National%20Shipbuilding%20Procurement%20Strategy%20-%20An%20Update.pdf McCoy, K. M. (2015).Design and analysis of US Navy shipbuilding contract architecture(Doctoral dissertation, Massachusetts Institute of Technology). https://dspace.mit.edu/handle/1721.1/100110 Sector, I. (2014).ITB Policy: Value Proposition Guide - Industrial and Technological Benefits.Ic.gc.ca. Retrieved 23 October 2016, from https://www.ic.gc.ca/eic/site/086.nsf/eng/00006.html#export Sloan, E. (2015). America's rebalance to the Asia-Pacific: The impact on Canada's strategic thinking and maritime posture.International Journal: Canada's Journal of Global Policy Analysis, 0020702015572764. https://ijx.sagepub.com/content/early/2015/03/03/0020702015572764.abstract Stone, J. C. (2015). Improving the Acquisition Process in Canada.SPP Research Paper,8(16). https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2590370 Vucetic, S. (2016). Who framed the F-35? Governmentmedia relations in Canadian defence procurement.International Journal: Canada's Journal of Global Policy Analysis,71(2), 231-248. https://ijx.sagepub.com/content/71/2/231.short