Australia is facing a changing strategic environment. Threats are no longer limited to invasion or direct attack. Threats to our economic prosperity through trade restrictions and supply chain disruption, as well as the growing threat of cyber warfare, are not bound by geography. At the same time, the effects of climate change are impacting our region and increasing the demand for humanitarian assistance and disaster response.
The government has responded to the changing strategic environment with the announcement of a range of new programs including the introduction of nuclear powered submarines and long-range precision strike capability. This is accompanied by an increased focus on cyber security, climate change and supply chain resilience. Collectively, this takes us into a domain dependent on new technologies, international alliances, and a highly skilled workforce.
In an interconnected and interdependent world, the ability to rapidly identify and effectively respond to emerging threats across multiple fronts is critical. A more integrated and responsive approach to national security and capability delivery is essential in this new strategic environment. As identified in the recent Defence Strategic Review, “our nation and its leaders must take a much more whole-of-government and whole-of-nation approach to security”. In this new strategic environment, it will be important to approach defence capability acquisition and sustainment as an integrated system of projects and programs to effectively address the complex and interconnected challenges facing the Australian Defence Force (ADF).
As the international peak body for complex project delivery, the International Centre for Complex Project Management (ICCPM) has been leading thought leadership and capacity building in complex project leadership since 2007. Sixteen years ago, the Australian Department of Defence identified a growing need for people who could effectively deliver capability in dynamic and uncertain environments. Today, that need is greater than ever, and it spans Ministries and industries.
This article presents a way of thinking and working which is aligned with the current need. It advocates for systems level coordination and the development of a workforce with the skills and attributes required of a complex project leader, to position Australia to effectively operate in the new strategic environment.
A Different Way of Thinking
In the language of complexity, the current strategic environment is a Complex Adaptive System (CAS). This framing is important as it describes the rich interconnectivity of the elements within the system and the dynamic and unpredictable nature of the system. In Complex Adaptive Systems, reductionist approaches are not effective. Addressing individual issues and risks in isolation is not guaranteed to achieve success and can often lead to unintended consequences. In Complex Adaptive Systems, a systems thinking approach is essential. This different way of thinking emphasises the need to embrace uncertainty and adapt to changing circumstances, rather than attempting to control or predict outcomes.
The Defence Strategic Review introduced the move to “a more holistic approach to Australia’s defence and security strategy and the implementation of a new approach to planning, force posture, force structure, capability development and acquisition”. ICCPM strongly supports this approach. In line with the volatility, uncertainty, complexity and ambiguity in the strategic environment, ICCPM is a strong advocate for the adoption of a systems approach to project and program management for the acquisition and sustainment of defence capability.
A systems thinking approach can help identify the relationships between parts of the system and how they interact with each other. By understanding these relationships, leaders can make more informed decisions and develop strategies for improvement at the systems level. Mapping can be done at any level (project, program, portfolio, industry, etc) to understand system drivers and identify leverage points for system improvement. They can also be used to identify potential unintended consequences.
When considering the broader strategic environment encompassing military, economic, diplomatic, and environmental, and the roles of government, industry and academia, Causal Loop Diagrams (CLD)may be used in a powerful way for understanding interdependencies and system dynamics. The following is a deliberately incomplete, high-level CLD (Figure 1) representing the establishment of a domestic industry to support the sustainment of a nuclear submarine fleet. It is presented to illustrate the power and importance of systems mapping.
Figure 1: An incomplete high-level Causal Loop Diagram (systems map) of the Nuclear Powered Submarine program (‘s’: same direction; ‘o’: opposite direction)
Causal Loop Diagrams can be used to:
- Identify the key stakeholders and their roles in the system.
- Map out the relationships between these stakeholders to understand their interdependencies.
- Identify strategies that can be used to adapt to changing circumstances.
- Apply systems thinking to identify the key drivers of the system and how they interact with each other.
- Identity ‘leverage points’ in the system and devise systemic intervention strategies.
- Develop a monitoring and evaluation framework to track the implementation of interventions and identify any potential problems based on feedback loops.
- Continuously review and adapt the system to ensure that it remains effective and relevant.
A key feature of Complex Adaptive Systems is the recognition that both “hard” and “soft” systems contribute to system dynamics. In the current strategic environment, the Indo-Pacific region faces increasing competition spanning economic, diplomatic, strategic, and military imperatives. The promotion of a rules-based order is an intense contest of values and narratives. In this context the diplomatic service becomes an essential element for surfacing hidden issues and influencing the strategic environment.
A Different Way of Working
The delivery of capability in a dynamic, uncertain environment requires a different way of working. Traditional project, program and portfolio management, predicated on an understanding of a controlled environment is no longer sufficient. The development of capability in a joint forces environment is no longer sufficient, nor is a siloed response across multiple Ministries.
The ability to respond to an increasingly complex strategic environment, requires a more systemic approach to defence capability acquisition and sustainment. This includes moving from a joint force to an integrated force capable of adapting and responding to the complex and interconnected challenges facing the Australian Defence Force (ADF). It also includes considering the delivery of defence capability within a whole-of-government and whole-of-nation context.
As far back as 2012, the ICCPM International Roundtable Series report, Hitting a Moving Target: Complex Project and Programme Delivery in an Uncertain World, identified failure to acknowledge and address complexity, as a common source of project failure. To deliver capability in a whole-of-government context, the ability to surface hidden issues and their impact on capability delivery is essential. ICCPM has adopted and expanded the Remington & Pollock Dimensions of Project Complexity (Remington & Pollock, 2007) as a framework to inform project leaders. This framework is defined below and in Figure 2 (the nuclear submarine program is again used to demonstrate its use).
Like the strategic environment, sources of complexity can change over time. They can occur independently or be interconnected. The opportunity for a project leader is to identify potential sources of complexity and take steps to mitigate them before they negatively impact capability delivery.
Dimensions of Project Complexity
Structural complexity can be defined as multiple partners, stakeholders or suppliers; large numbers of interconnected activities; interdependencies.
Technical complexity includes the development or integration of new technologies into new or modified products or services.
Directional complexity is frequently exhibited by a misalignment of project goals or expectations, hidden agendas or the loss of original intent (e.g., when handing over to a new leader or team).
Temporal complexity portends a shifting environment or strategic direction over time, often experienced during mergers or changes of government.
Socio-cultural complexity (added by ICCPM) consists of human interactions and needs, diversity, unconscious bias, organisational culture and societal expectations.
Figure 2: Mapping potential sources of complexity in the Australian nuclear Powered submarine program (deliberately incomplete and based on publicly available material)
The changing strategic environment will undoubtedly introduce complexity into the delivery of defence projects. The ability to identify and respond to complexity will impact the success of defence acquisition and sustainment programs.
An important shift articulated in the Defence Strategic Review is that a “Defence’s force design must also address the current bias towards platforms. A platform that cannot be crewed or does not have weapons to fire at a range to achieve the desired operational or strategic effect, will not serve us well in the current strategic environment”. ICCPM strongly supports this outcomes-focused approach. In the context of Complex Adaptive Systems, the focus on acquisition and the development of technology in response to an individual risk or individual force requirement does not align with the need for system level responses outlined above. In an evolving strategic environment, the alignment of procurement with system objectives, and the requirement for system integration and sustainment is essential.
There is a growing opinion that building domestic production capacity is crucial for ensuring reliable access within the defence industrial base. Furthermore, it is crucial to create an ecosystem that supports innovation, redundancy, and new capacity in the defence supply chain. To successfully develop a comprehensive domestic supply chain, it will be critical to work closely with industry and economic policy to continually evaluate and adapt strategies in response to evolving challenges and requirements. The implementation processes, industrial mobilisation efforts, and various related considerations should be thoroughly examined to ensure the effective execution of the domestic supply chain development plans.
When considering acquisition and sustainment in a Complex Adaptive System, the use of a Viable Systems approach to create a framework that supports the resilience and adaptability of defence capability development and acquisition is necessary. A feature of Viable Systems is that they monitor and adapt to the changing environment in alignment with the strategic purpose of the system, whilst satisfying any governance requirements and coordinating the use of resources for efficiency. This outcomes-focused approach supports the development of capability in line with national strategy whilst allowing projects to adapt to the changing strategic environment. It shifts the imperative for the acquisition and development of technology from a response to individual risks, to a systemic risk response and establishes more resilient systems capable of responding to environmental changes.
The recursive nature of Viable Systems also means this approach can be used to align capability development and deployment at the project, program, portfolio, force, and national levels. To achieve the full impact of this approach, this would include aligning project governance, contracting and finance approaches with the emergent uncertainty in the strategic environment.
The current strategic environment can be characterised as emergent. Emergence is a known characteristic of Complex Adaptive Systems. Although it is by definition unknowable, there are strategies for establishing resilient systems capable of delivering defence capability in emergent environments. Figure 3 below shows the possible zones in which emergence can occur. The real challenge lies in zone 3, the zone of strong emergence where project leaders may face unknown unknowns and where such vulnerabilities are undiscoverable in advance. This is because truly emergent risks are simply not discoverable until they begin to emerge. Since emergence in this paradigm implies a time and relational component, an emergent uncertainty may be present now or yet to emerge. This distinction is important because until an emergent property is actually present, the risk is unknowable. Once it is present, the risks are always knowable. This is the domain of ‘weak signals’ where obliquity or attentive intelligence is required.
Figure 3: Zones of Emergence (Source: Harnessing Emergence in Complex Projects: Rethinking Risk, Opportunity and Resilience, ICCPM 2020-21 International Roundtable Series Report)
The delivery of defence capability in emergent environments, requires greater integration and collaboration between different branches of the military, as well as with other government agencies and international partners. A Viable Systems approach supports a more holistic approach to project and program management, with a focus on building flexible and adaptable systems that can respond quickly to changing circumstances, as well as a willingness to embrace innovation and collaboration in order to stay ahead of emerging threats and challenges.
Australia has responded to the shifting strategic environment with a range of new programs, taking us into a domain dependent on new technologies, international alliances, and a highly skilled workforce.
In addition to a highly skilled STEM (Science Technology Engineering and Mathematics) workforce, the ability to effectively operate in complex environments and deliver tangible benefits requires an additional skill set. This skill set is identified as Complex Project Leadership (CPL) and the individual competencies are defined in the Complex Project Manager Competency Standards. These competency standards are maintained by ICCPM on behalf of the Commonwealth of Australia.
Given that the defence environment is inherently complex, with multiple stakeholders, competing priorities, and a high degree of uncertainty. The risk to achieving success may very well be to continue to apply traditional project management methodologies alone when a more holistic, flexible and adaptive approach is better suited. This does not mean ‘throwing the baby out with the bath water’ and abandoning the traditional project management methodologies. However, projects and programs are not delivered in a vacuum and therefore it does mean augmenting those traditional skill sets and worldview with an additional worldview and set of competencies that better reflect the systemic nature of the environment in which the capability must be delivered.
Complex Project Leadership emphasises the importance of adaptability and flexibility in project delivery. It recognises that projects are often subject to unexpected changes and that project leaders often need to make decisions in uncertainty and ambiguity. They need the ability to think and act systemically, to leverage the expertise of multidisciplinary teams, to engage stakeholders as core members of a project team, to surface hidden risks and manage systemic risk, and to manage situations where there is no one right answer.
Figure 4 presents the need for a workforce skilled in complexity in addition to the traditional technical skills required to deliver the asset (plane, submarine, HR system, etc). The ability to see projects not just ‘as assets’ but also ‘as systems’ and ‘as conversations’ and to be able to act from a strategic logic is at the core of the project’s success.
Figure 4: Paradigms for Leading Complex Projects (Source: Project Leadership: The game changer in large scale complex projects, ICCPM 2018-19 International Roundtable Series Report)
The ability for the project to monitor and respond to the changing strategic environment is dependent on also having highly skilled complex project leaders as part of the project team. These leaders may be capability managers or project managers, but they may also be engineers, contract managers, finance managers or project professionals from any other discipline.
This workforce will increasingly be drawn from a combination of defence personnel, the Australian Public Service and contractors. The ability to harness its full potential will be dependent on developing a shared understanding of complex project leadership and the formation of an effective complex project team. Cultivating the project team’s ability and awareness of different project perspectives enables deliberate perspective taking, instead of merely acting out of habit. In the case of complex projects, this can be the difference between success and failure, as ‘best practice’ based on previous projects may not suffice to deal with the unique characteristics of this project.
This requires a shift from a focus on the development of individual skills and competencies, to the development of organisational capability and team development. ICCPM supports this development through combined training cohorts of cross-functional teams and action learning workshops.
The stakes are high. The strategic environment is changing, and Australia needs to align its response with the volatility and highly interdependent nature of the environment. We need to respond with strategic foresight and a systems approach. This includes prioritising collaboration and cooperation with domestic partners and allies in the region to ensure the country’s security and strong defence posture in the face of evolving security threats.
The key to successfully delivering capability in this new strategic environment will be:
- national leadership with a deep understanding of complexity and systems thinking;
- the ability to work in uncertainty and deliver capability in a changing environment;
- the alignment of governance, contracting and finance frameworks to an increasingly dynamic and uncertain environment;
- the ability to effectively engage stakeholders;
- the ability to manage polarities, such as immediate capability delivery and the development of new scientific and technological innovation;
- the ability to balance strategic, economic and environmental imperatives to support domestic resilience.
As the international peak body for complex project delivery, ICCPM looks forward to continuing to support the Australian Department of Defence and Defence Industry, the broader Australian Government, and our allies in building this essential capability.