It is a truism in business that the customer is always right.
But in the peculiar world of military contracting, it is not always clear exactly who the customer is.
By most reasonable criteria, one would presume that the customers of military contractors are the soldiers, sailors, airmen and marines who defend the nation.
But that is not necessarily so.
It will come as no surprise to military contractors that in the business of defense, the definition of “customer” can be indeed convoluted. The numerous layers of bureaucracies that oversee the design, development and procurement of new weapons have created a system where it is virtually impossible for a company to really focus on the customer.
Suppliers of military equipment may find it “emotionally satisfying” to claim combat soldiers as their ultimate customers, while in fact most companies are organized so that they can satisfy a complex web of buying organizations that may or may not reflect the true needs of combat soldiers, suggests a recent article in the Defense Acquisition University’s monthly journal.
Nowhere do companies find it more difficult to concentrate on true customer needs than in the Army procurement system.
In a piece titled, “Customer Focus and Army Procurement: Is It Possible?” industry experts Keith R. Shelton and Drumm McNaughton postulate that the first problem encountered with the Army procurement system is determining who the customer really is.
All defense contractors want to provide products and services to the combat soldier. “Public relations demand this sort of ‘user as customer’ focus,” they write.
The uncomfortable truth in this industry, however, is that the users of Army products — the combat soldiers — do not control any of the actual procurement processes.
Shelton and McNaughton explain — in terminology that would make most people’s head spin — why combat soldiers cannot possibly be considered the real customers. Fighting forces are so far removed from the acquisition process that any contractor who pays too much attention to frontline troops is going to fail in business.
The key to success is to develop relationships with each of the “customers” that are in charge of the different phases of a weapon’s design, development and procurement. Early in the development cycle, the customers are officers within the Joint Chiefs of Staff, who vet each weapon system to ensure the requirement is valid. Later, the “combat developer” agencies are seen as the customer. Later, the “material developer” community becomes the customer.
Throughout the whole process, various “proponent schools,” such as infantry or aviation, are the customers. “Relationships must be formed with each of these communities if any influence is to be gained,” Shelton and McNaughton note. “This obviously makes for a bewildering mix of relationships, because each of these customers has a different set of needs and concerns.”
Every piece of Army hardware that is fielded to soldiers goes through seven distinct stages, each of which is tightly controlled by statute and regulation. As a result, the authors maintain, defense contractors cannot quickly capitalize on an innovation or a technological breakthrough by marketing a new product to combat soldiers.
While neither Shelton nor McNaughton recommends a radical overhaul of the procurement system, they do raise disquieting questions about the government and industry’s capacity to satisfy the requirements of combat forces. If the authorities who make buying decisions are not truly representing the needs of combat troops, then who’s to blame?
No specific culprit is identified. It is a classic chicken-and-egg conundrum. The Army procurement system is so inflexible that contractors, if they are to stay in business, have to please many masters who may or may not speak for the users of the products. As a result, companies organize themselves in accordance to the Army’s rigid structure and are financially not motivated to operate with a “customer focus” in mind. And the beat goes on.
In recent years, the Army has introduced “rapid acquisition” programs to expedite the delivery of equipment requested by commanders in Iraq. But short of a radical overhaul of procurement rules, regulations and legislation, American defense contractors will never be able to deliver what business gurus call “personalized experiences” or “real time solutions to identified problems,” Shelton and McNaughton write.
Their elaborate analysis brings to mind the plight of soldiers who, in the months following the invasion of Iraq, found themselves in a treacherous war zone without sufficient body armor or armored trucks, with shortages of handheld radios, jamming devices to neutralize bombs and fire retardant garments. It took the Army about two years to backfill the demand for such essential gear.
Talk about customers being shortchanged.
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