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QUALITY & RISK ASSESSMENT: INTEGRAL TO PROCUREMENT MANAGEMENT

A new autonomous Defence Procurement Organization (DPO) is need of the hour, to work directly under the Ministry of Defence (MoD) to deal with the procurement for the Armed Forces. The organisation need to have accountability and transparency with a mandate to manage delivery within the agreed PCTR (Performance, Cost, Time and Risk) as per the annual acquisition plans.

Revamping Defence Procurement Organization (DPO)

Dr. Pritam Singh committee was mandated to recommend a revamped acquisition setup for provisioning for the Armed Forces, enhancing indigenization, building capabilities within the country and creating an effective defence industrial base in India. In one of the recommendation on Defence Procurement Organization (DPO), the committee has favoured a new autonomous organization directly under the Ministry of Defence (MoD) to deal with the procurements for the Armed Forces. It will have the mandate for formulating policies as also planning and executing weapons purchases for the Armed Forces. Basic guiding principles suggested for its functioning are, that it should be a fully autonomous body, with decentralized decision making, and to make the DPO burden the onus of accountability and transparency with a mandate to manage delivery within the agreed PCTR (Performance, Cost, Time and Risk) envelope, as per the annual acquisition plans. Hence, the Indian MoD is planning to have a separate and professional body for Defence Procurement.

Caveat: As the report has not yet been put up in the public domain and is still under consideration, one will have to await the outcome of their recommendations and acceptance by the MoD.

Quality and Risk Assessment Part of Procurement

Among the key processes of any Quality Management System (QMS), the process of procurement and management of material resources directly affects the quality of the final product and therefore the performance and reputation of the organization. An efficient process of procurement and management of material resources based on good relationships with the suppliers will help to increase the effectiveness and efficiency of the organization and achieving lasting success by meeting the expectations of all stakeholders.

            Due to a dynamic and competitive environment, in which prices are subject to ever increasing pressures, quality becomes a determining factor, and sometimes even a casualty, in the competitive struggle. However, needless to say, the ultimate Users always place a great premium on quality and reliability of systems under procurement/acquisition.

            Though the DPP does envisage certain limited functions by the Quality Assurance (QA) agencies during the procurement process, unfortunately the same are more conspicuous by their absence. The main role of QA agencies is typically visible only during post-procurement stage, mainly during the production processes and the Acceptance Inspections. Hence, often quality issues surface at a much later date when the procurement process has already been completed, which is rather too late. Therefore, Risk Assessment and Risk Management functions are ideally to be carried out (duly incorporating the QA agencies) during the early stages of evaluation and procurement.             The Risk assessment needs to be done, at ab-initio stages of procurement, keeping in view the following:

  • Identification of technical capabilities and limitations of available concepts and design options under consideration.
  • Association during initial stages of system under development to ensure robust design, and best production Processes and Practices
  • Evolving effective validation processes to preempt/ minimize unforeseen failures post procurement.
  • Assessment of project to ensure that the critical technical and operational parameters envisaged by the User are met, viz effective Compliance Assessment.
  • Certifying the system's readiness for operational or field evaluation based on analyses of the test data.

Multiplicity of QA Agencies within MoD

India is, undeniably, known to have a complex, multifarious and multilayered agency based control system, and especially so in the matters of defence acquisition and production. Take an example of Quality Assurance in defence - there are number of QA agencies existing within the MoD, with different cadre structures and each having different reporting channels and each having different work processes, procedures & ethos.

            Currently, the MoD is besotted/saddled with the legacy of having multiple QA agencies under its aegis, all of which are placed quite far away from the DPO, and each has its own customized processes and procedures. This often deprives the DPO from fully exploiting the quality and reliability expertise of these organizations. Therefore, the need to amalgamate and integrate the QA organizations with ab-initio procurement functions assumes paramount importance. Various QA agencies and organizations are:

Dte Gen of Quality Assurance (DGQA) - In existence since 1869, this is by far the largest, oldest and the flagship QA organization under the Department of Defence Production (DDP), uniquely mandated by the system to render 2nd Party QA services, to both, the production & supply agencies as also to the Users viz the Armed Forces. It is tasked to look  after the whole gamut of QA functions in respect of complete range of systems, including all war-like equipment and the Armaments  of the Army, and those common with the Air Force  and the Navy (except Naval Armaments).

Dte Gen of Aeronautical QA (DGAQA)- This too functions under the direct aegis of the DDP, and looks after the QA functions in respect of all Airborne stores & eqpt of the Air Force.

Dir Gen of Naval Armament Inspection (DGNAI) - This organization is a part of NHQ and functions directly under their aegis. It carries out all QA functions of Naval Armaments viz weapons and ammunition of the Navy. However, QA of the rest of the equipment in use by the Navy viz the Warships and the Naval Stores, is provided by the DGQA.

Missile System Quality Assurance Agency (MSQAA) - It was created in the year 1990 as a common Inspection Agency for providing QA coverage during development and production of all indigenous missile systems under Integrated Guided Missile Development Programme (IGMDP) of the DRDO. It functions under the administrative control of the DGAQA, and is manned by personnel drawn from the DGQA, DGAQA and the DG(NAI), and also headed in rotation by officers from these three QA organizations.

Strategic Systems QA Group (SSQAG) - This has been set up in 2010 for providing QA cover to the Strategic Missiles, both ground and air, being developed by the DRDO. This too functions under the administrative control of the DGAQA, and is manned/staffed by personnel drawn from the DGQA, DGAQA and the DGNAI.

Dte of Standardisation - Though strictly speaking, this entity working directly under the DDP is not a QA organization, but it carries out various standardization functions which are crucial to QA activities. It can play a vital role in standardizing the hybrid gamut of nomenclatures, specifications, processes and QA plans based on Universal Best Practices in QA.

 Need to create single QA organisation

Each of these organizations have their own processes, specifications and criteria even for similar products, thus working in isolation. There is dire need to amalgamate all these into one cohesive entity, without affecting their individual charter of duties and mandated responsibilities in their own domains. Simultaneously, various QA activities also need to be standardized, which could be achieved by making Directorate of Standardization integral to restructured unified QA organization.

            Such an unified umbrella organization will not only have an advantage of removing/minimizing duplicity and redundancy in quality levels and quality management practices across all agencies, but also result in synergizing and reinforcing the Best Practices of each other, which would be of a great advantage to all stakeholders and saving the nation to the tune of Rs 100 Crores every year.

Integrating QA Agencies within DPO

The new DPO ought to have the unified QA organization as integral to its set up. The new DPO is likely to be an Organization with broad charter in Defence Procurement as under:-

            The quality function encompasses all functional areas that are involved in internal definition of quality right from customer's perspective to assurance, product/service consumption and satisfaction.  The function can be considered as a horizontal spread inter-twining throughout all the functions of the organization.

            Traditionally, the QA functions have been performed strictly as Control Functions, wherein all the Quality related issues are tightly controlled by the QA agencies. In the changed scenario, the Quality Management function has to have inherent capability to redefine/transform itself from controlling function to a facilitating function by being associated with identification of requirements, mapping existing knowledge of the platforms, identification of the gaps, fill the knowledge gaps, and continually expand the base to meet the requirement. This will mitigate the risks associated with non-integration and non-dovetailing of QA in the processes of the DPO.

            The closer and intimate association of QA with the Procurement Organization will also bring greater organisational effectiveness through professional best practices, and to meet future challenges posed by problems of rapid obsolescence, greater user awareness, cost consciousness and brisk technological advancements in various fields.

            The MoD ought to take initiative to evolve policies, systems and procedures for achieving and improving such a program through proper integration of agencies and processes in new entity for procurement management. Configuration management is one such function which is essential part of procurement management. It entails process for establishing and maintaining consistency of a products performance, functional & physical attributes with its requirements, design & operational information throughout its life and insulate the military systems from suffering from reliability and quality related issues.

            DGQA, by virtue of its wide-ranging and deep core competences, could be the nodal agency of the new amalgamated unified QA entity.

Epilogue

Revamping of the DPO is the need of the day, while the current set-up of the DPO and its various constituents, have endeavoured  to  procure, provide and provision the best for our Armed Forces, a few  crucial aspects need to be taken care of  in the new avatar of the DPO that is in the offing. The concept to have a Unified QA, fully in conformity with the practices as followed by many militarily advanced developed countries and to integrate it with the all-important Defence Procurement Organization (DPO) needs to be given a serious consideration.

            Model of ARMSCOR, the Armament Corporation of South Africa, would be an ideal DPO model to follow. This single and fully autonomous organizationis mandated to carry out all functions on behalf of the their Armed Forces (SANDF) as well as their DoD viz R&D, indigenous Production, Exports, Full QA (including during pre-procurement, during trial evaluations, during production, during in-service e.g. failure Analysis, operation of T&E facilities including Firing ranges etc, and right upto disposal stage), in-service upgrades, etc. Such a single window concept is also followed globally by many other countries, where the QA is an inbuilt entity in the procurement management.

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