Australian Defence Dept. to rationalize IT management

Australia’s biggest IT buyer, the Department of Defence will drastically rationalize the way it manages its information systems, with the position of CIO elevated to take charge of all “development and support of enterprise management applications”.

Known internally as the “super-CIO job”, the new position will absorb Defence’s information systems division (ISD), [part of the corporate services and infrastructure group] and potentially the IT side of Defence Materiel Organisation’s supply chain projects.

The massive shake-up aims to place day-to-day management of Defence’s back-end systems, called Defence Information Environment or DIE in the Chief Information Officer Group (CIOG) which will manage almost all of Defence’s enterprise systems.

Sources close to the project told Computerworld the changes are intended to force through savings of “hundreds of millions of dollars if not billions” from IT suppliers by effectively forcing them to sell into a single and coordinated entity, thus thwarting the “current divide and conquer approach” exploited by many vendors to recreate work and “perpetrate scope creep”.

After suffering two conspicuous IT-related pastings by the Australian National Audit Office, Defence department secretary, Rick Smith is also enthusiastically selling the savings behind the CIOG plan, albeit dolled up as strengthened governance provisions in the new deal.

“In combining the expertise, we will provide a single organizational point of focus and accountability for the DIE. The governance of DIE spending will be significantly improved under the new management arrangements and links between strategy, development, procurement and support of the DIE will be even tighter,” Smith said.

While the CIOG will effectively take charge of vendor wrangling and enforcement of service delivery levels to Defence organizations, users will still largely retain autonomy over their own business process definitions and system requirements for IT, effectively making the CIOG an in-house IT services shop similar to an outsourcer.

The IT shake-up comes only a fortnight after the delivery of a Boston Consulting Group (BCG) report to Defence top brass on ways to improve Defence’s IT performance and curtail budget blowouts.

Defence commissioned the BCG report last year following the unexpected departure of then CIO Patrick Hannan to become CIO of Victoria. Ironically, Hannan was also recruited into the Victorian position by BCG.

Since Hannan’s departure, Air Vice Marshall Julie Hammer has been filling the role of acting Defence CIO, occasionally raising questions as to when a permanent appointment would be made.

According to Defence, Hammer will continue in her current role until a permanent appointment for the new super-CIO is made, with the CIOG coming into effect from December 3.