Indigenisation of Aerospace Industry

Jonah’s Thinking Process

PV Athawale

Published first in Asia Defence Review 2012

By Centre for Air Power Studies

The world we have created is a process of our thinking. It cannot be changed without changing our thinking

                                                                                                      - Albert Einstein

Introduction

Indian Industry

Until independence, India had remained significantly isolated from the industrial revolution around the world¹. Independent India gradually began on a progressive path of industrialisation with a firm resolve. A poor nation with a large population and little design and manufacturing infrastructure chose the socialist route to industrial growth through the public sector. Even after the economic reforms of the 1990s, the hi-tech aerospace design and manufacturing have been left relatively untouched by the private sector. This can be attributed to the inherently high costs and the lack of a market. The public sector has contributed only sporadically with products for use primarily by military aviation. The defence production units viz. Defence Public Sector Undertakings (DPSUs) and Ordnance Factories (OFs), having made their contribution, seem to have tapered to saturation. Their qualification and ability to undertake Design and Development (D&D) tasks, however innovative and efficient, do not inspire great confidence. If there is anything that will bring about rejuvenation, it is competition.

In keeping with a socialist ideology, the country kept itself isolated from external suppliers until the 1980s. Clearly two generations behind those in the world market, cars made by Hindustan Motors and Premier Automobiles managed to transport Indians who wore hmt watches. But, on the subject related to defence of our skies, we required machines that could match the adversaries’ assets. Having the latest technology in cars may not have been a necessity but when it came to aircraft, it was imperative to keep pace with the world. There was a limit to which the genius of our pilots would have offset deficiencies in our aircraft. We were, therefore, compelled to acquire aircraft and systems from foreign sources. This proved to be sufficient justification for scrapping the indigenous Maruts (HF-24) to make way for the British Jaguars even as the decision hurt the sentiments of many air warriors. With the surrender of indigenous military aerospace design and manufacture to foreign purchases, the Indian industry was left with no option but to be satisfied with manufacturing under license.

The opening of Indian markets after the 1990s changed the economy but the industry remained under a distinct hangover from the past, so much that the typically Indian fear of manufacturing has endured through this long phase of economic growth. The economy has been propelled primarily by the service sector, which suited the Original Equipment Manufacturers (OEMs) from abroad. By outsourcing routine work to India, they got access to our markets while safeguarding key design and manufacturing acumen. Most industrial sectors, after having gone through these long phases of services and partial manufacturing/assembly under license, are now attempting to break free to enter into independent design and manufacturing.

However, the aerospace industry’s predicament has continued even in the post 1990s scenario. Unlike others, the aerospace industry cannot develop its own market segment, especially in view of the distinctly higher cost and technology involved in the face of an extremely restricted and uncertain market. Therefore, state sponsorship has been
essential for growth in this sector where the entry of new players is almost impossible without government support. The public sector has justifiably been favoured for the last few decades. But, the DPSUs have gradually gone into a state of virtual happiness with licensed manufacturing. They are going down further to seek the routine maintenance of Air Force inventories in the field, shifting their focus from D&D. Ordnance factories, tucked well behind the Ministry of Defence (MoD) show little respect for accepted production tasks. At the same time, the Defence Research and Development Organisation (DRDO) has not succeeded in bringing out competitive technologies with acceptable standards of reliability and product support from manufacturing partners. The most disappointing part has been the lack of adherence to time schedules. The Air Force, amidst this national industrial incapability, has found justification in looking out for arms purchase from foreign vendors.

Around the world, only a few global companies supply aircraft and equipment to most civil airlines and airport authorities. The civil aerospace sector is also like any other commercial field e.g. motor cars manufacture. The lack of indigenous control here does not have a far-reaching strategic impact as in the case of defence aerospace. Different airlines as buyers find it suitable to purchase from the best globally available. In comparison, institutionalised measures by the MoD to promote indigenisation and provide for offsets in defence procurements have particularly encouraged the industry including the private sector. Therefore, the entire indigenisation focus of the Indian aerospace industry hinges on defence supplies, resulting in raised expectations from the defence establishment.

Where does Air Power Reside?

The Air Force, without doubt in anyone’s mind, is the measure of air power. It is the front end. It is the agency which is ultimately responsible for effective deployment of air power on call by the national leadership. Technically, a reference to the Air Force should not include the air arms of the Army and the Navy. But, for the sake of simplicity, we may call the combined air arms the ‘Air Force’. As we ponder upon ‘where the foundation of air power lies’, we are called upon to look well beyond the Air Force. Even though behind the scenes, indigenous defence Research and Development (R&D) and industry begin to play a distinctive role as expectations from air power rise.

      Fig 1 

 

The defence aerospace power can be perceived to rest on a triangular foundation made of the three vertices viz. DRDO, Industry and Air Force (Fig 1). The reach and influence of this aerospace power is determined through a non-linear relationship with the three determinants. This is held in a precarious balance as each contributing element works towards maximising its own effectiveness to feel constrained by the lack of contribution of someone else - ‘the problem is always somewhere else’! The biggest positive is the fact that everyone wholeheartedly agrees with the objective of indigenisation. And yet, everyone finds so many hurdles in decision-making and execution. These conflicts paralyse us in status quo and we remain unable to take action to change things for the 

better under the fear that the situation may turn for the worse.

The conventional view serves to protect us from the painful job of thinking.

 -  John Kenneth Galbraith

Transformation of Conflict into Synergy

While all involved may be well meaning and working relentlessly towards organisational goals, conflict arises because the efforts do not synergise. There is no inherent conflict among people. And, therefore, the triangle of conflict can easily be transformed into the triangle of synergy. In my opinion, the Theory of Constraint’s (TOC’s) thinking process can help us get rid of this conflict. I wish to provide a glimpse of this approach here, the details of which can be worked out by a separate task group if we really want a change.

Defence researchers and analysts are left with no time and energy for industrial issues, because the predominant combat element of air power hogs all their attention. Military literature includes technology issues usually related to fascination with future possibilities and innovative applications. It also deals with the operational aspects of logistics and supply chain. But seldom are the optimisation philosophies for acquisition and life cycle fleet management discussed in books that are globally acknowledged and sold. It is a relief then that theories and practices from the commercial world apply equally to the military, which in itself is a big industry. However, research from the commercial arena does not attract adequate attention of military men because of references to market, money, profit, customer, etc. We do not like to be diverted from air power related strategic or tactical battle space vocabulary to something so commercial. The text, therefore, needs to be suitably modified and adapted to be meaningful to the military. I will attempt to link the TOC expressions with our air power context in a limited sense to break the conflict related to indigenisation.

Introduction to Theory of Constraints

Before a detailed discussion in the context of indigenisation, it will be useful to present an overview of the Theory of Constraints (TOC). Eliyahu M. Goldratt developed the ‘Theory of Constraints’ as a management and improvement philosophy. He introduced it through his many books including The Goal (1984)², The Goal II - It’s Not Luck (1994)³, Critical Chain (1997)⁴ and Theory of Constraints (1999)⁵.

Goldratt saw organisations as systems with resources and processes to perform. TOC asserts that “any manageable system is limited in achieving more of its goals by a very small number of constraints, and there is always at least one constraint”. This constraint may be related to  machines,  equipment,  people  or  policy. A five-step process for improvement is suggested by this theory as listed below:

·         Identification of constraints.

·         Decision on how to exploit the constraint (to get the most capacity out).

·         Subordination of everything else to support the decisions.

·         Elevation of the constraint (break through other major changes).

·         When the constraint is broken and it moves, getting back to step 1 and not letting inertia become a constraint.

The logical conflict between the society and industrial processes has been explained by Kelvyn Youngman⁶. He says that our everyday beliefs and mental fixations of social networks block us from understanding the industrial processes. This is what he calls the ‘error of logical type’. Social networks call for optimising individual outputs to maximise group achievement. On the other hand, industrial systems are more sequential, where the system output is limited by the weakest element called the constraint. Parts other than the constraint have excess capacity. Therefore, optimising all parts for maximising individual output would lead us to no enhancement. In fact, the usual state of the system is such that it is unable to even produce to the maximum capacity of the constraint. That is why we have to maximise the constraint instead of maximising every system element.

Thus, the theme of ‘maximising almost all while subordinating a few’   from the social world has to give way to ‘maximising only the constraints while subordinating everything else to that’.

The Theory of Constraints covers many things, including some of the following:-

·          Five focusing steps for solution (listed in above para).

·       Drum Buffer Rope: The drum is the rate at which the constraint resource is able to process. The correct loading of the constraint is ensured by the ‘drum beat’. The   Murphy is looked after by a buffer set up in front of the drum in such a way that work is always waiting to be taken up by the constraint. The constraint is never required to wait for work otherwise the output would go below the capacity of the constraint itself. The important aspect is that the buffer capacity is measured and set up in units of time required by the constraint. The rope is the schedule that ties all parts of the system together to enable subordination of the capacities of all non-constraint parts to the constraint.

·       Critical Chain:. Project managers estimate the time required as the arithmetic sum of estimates of different parts. The different parts tend to estimate requirements with their own safety margins pushed in. The result is that the benefit of specific parts finishing early hardly ever goes to the subsequent stages, but the delays are shared. Therefore,
Critical Chain Project management was developed by Goldratt to solve the problems of projects’ time as well as cost overruns. The longest dependent path is identified as the ‘Critical Chain’ as against the ‘Critical Path’. A project buffer is kept to account for the
overall delay. Feeding buffers (of time) and resource buffers (of people and skills) are kept for the critical chain. Finally, the tasks are measured in terms of their remaining duration rather than percentage completion.

·       Thinking Process: Goldratt put forward the ‘Thinking Process’   to find solutions to systemic problems. The process breaks the constraint of our thinking paradigm. The identification of the root cause of the systemic problem, its solution and implementation are achieved by addressing three fundamental questions: ‘What to change’, ‘What to change to’ and ‘How to cause the change’?

The Goal

The clarity of the ‘goal’ of an organisation is the starting point for every related action and most certainly actions related to transformation and improvement. Therefore, before we identify constraints, the following prerequisites are essential.

·         System definition and its goal (purpose or objective).

·      Determination of a metric or a measure to evaluate the efficacy of the system meeting its purpose.

For all business organisations, Goldratt suggested the purpose or goal in simple language as, “Making more money now as well as in the future”. To amplify further, he suggested, “To provide a secure and satisfying environment for employees now and in the future” and “To provide satisfaction to the market now as well as in the future” as the other two primary objectives for sustenance of the business. Each one of the three can be seen as complementary to the other two.

Here the contrast between business and the military is obvious. The military is not interested in making money today or tomorrow! But, the armed forces most certainly are concerned about reducing operating expense to maximise the use of the available budget. The military has a goal which must be kept sight of at all times. As an example, one may say that the goal of the Air Force is to match (or better) the individual (or combined) capabilities of adversaries. Alternatively, one may say the goal of the Air Force is to be a regional air power or an air power with global influence. The next important issue is whether the achievement of the goal is measurable. Military men are known to be proud of their discipline and ethics. Above all, we are fond of a different set of rules to determine the behaviour of our men as well as machines. We don’t like the civilian business world to cast its shadow on our systems and would, therefore, quickly close our minds to ‘sales and profit’ talk as simply ‘not applicable’ to us. At this stage, therefore, I wish to reiterate the relevance. It won’t be justifiable to close up by saying no yardstick of measurement of efficacy applies to us. Oversimplification by measuring percentage serviceability or flying effort as per current norms could be misleading. The number of squadrons maintained, average fleet serviceability and flying effort are all incomprehensive measurements. These must be made to relate to force structure, fleet availability (not unit percentage serviceability), training and war potential.

Goldratt considered business companies to be making money when they created value add to bought out material faster than the expenditure. He identified three ways of categorisation with Throughput, Operating Expense and Rate of Return. In essence, the measure of value generation is vital for making decisions regarding process refinements, whether the organisation makes money or generates output in different units. For military requirements, the throughput measured as war potential generated (per unit of constraint per unit time) must govern all decisions. Can we then measure war potential like the bottom line of a business balance sheet? Like the throughput, we can certainly devise appropriate metrics, but that perhaps will have to be the outcome of a separate study.

Jonah’s Thinking Process

A fictitious character by the name of Jonah was created by Goldratt in his story-like books to illustrate TOC. The thinking process has accordingly been popularised as Jonah’s Thinking Process. In line with the scientific approach, this process verbalises the cause and effect relationships so that the assumptions can be verified. These assumptions
are challenged and either invalidated to relieve the conflict or accepted to gain renewed understanding of relationships. The following fundamental beliefs are at the core:-

·         Nature has inherent simplicity and not complexity.

·         Nature has inherent harmony and no conflicts.

·         All problems converge to a single root cause or core conflict.

·         There are no bad people; we only have bad assumptions.

The thinking process uses six methods to enable focused improvement. These are discussed briefly here to enable appreciation of the concept. The retention of some of the original terms may make the text a little intricate. But, the examples of our domains will make things easily comprehensible later on.

Current Reality Tree (CRT)-1

The  thinking  process  starts  with  precise  articulation  of  the  problems  named  as Undesirable Effects (UDEs). As per the guideline, articulation of UDEs does not require an explanation; no cause, no blame is to be assigned and no solution is required to be offered. With UDEs, we build a Current Reality Tree connecting the cause and effect relationships of all problems. An example is shown in Fig 2.

        Fig 2

               Evaporating Cloud or Conflict Diagram-2

The  systemic  cloud  is  drawn  as  shown  below  in  Fig  3  for  breaking  the  conflict surrounding a given problem. Here the prerequisite is an objective, which is a positive systemic objective agreed upon by all parties. B and C are needs; both are positive and supportive of the objective. The prerequisite actions and wants at D and D’ individually support the needs at B and C respectively, leading to the objective. But, these conflict with each other and cannot exist together. At the same time, D jeopardises the need at C, while D’ jeopardises the need at B; this is what makes the conflict really tight. These are real life situations as we will see later.

Fig 3

  

                                                                                                                                              Now, all linkages from one block to the other are verbalised listing assumptions for each as shown below:

l   In order to have A, we must have the requirement B because <reason 1>

       In order to have A, we must have the requirement B because <reason m>

l   In order to have B, we must have the action D because <reason 1>

       In order to have B, we must have the action D because <reason n>

l   In order to have A, we must have the requirement C because <reason 1>

       In order to have A, we must have the requirement C because <reason p>

l   In order to have C, we must have the action D’ because <reason 1>

  In order to have C, we must have the action D’ because <reason q>

l   If action D is carried out, then we cannot get C because <reason 1>
      If action D is carried out, then we cannot get C because <reason r>
AND

l   If action D’ is carried out, then we cannot get B because <reason 1>
      If action D’ is carried out, then we cannot get B because <reason s>

As we verbalise our assumptions and carry out a rigorous check, we begin to invalidate many assumptions leading to the conflict. Injections (or actions) can be then generated for insertion in the Current Reality Tree (CRT) to remove conflicts to turn Undesirable Effects (UDEs) into Desirable Effects (DEs). Evaporating clouds bring out and confirm ‘what to change’.

Future Reality Tree (FRT)-3

The FRT is constructed with injections taken into account to enable testing new ideas. This is drawn exactly like the CRT except for the difference that some assumptions have been invalidated and new actions and policies have been injected. Now the tree looks all positive and approaching a solution. The FRT also reveals any possibility of collateral affects and permits addressing these. This enables us to know ‘what to change to’.

Negative Branch Reservation-4

As members participate, the actions listed in the FRTs can throw up a few negative reservations. These are required to be dealt with by validation of new assumptions or insertion of additional actions (called injections).

The Prerequisite Tree (PRT)-5

The third step deals with implementation of the solution i.e. ‘how to change’. Towards this, the PRT helps in identifying obstacles in the way of implementation. The FRT with injections and trimmed negative branches is the input to the PRT. People who are intuitive in their respective fields can visualise obstacles in implementation and also Intermediate Objectives (IOs) to achieve. With their participation, the PRT is made to indicate sequential actions to achieve objectives.

Transition Tree (TrT)-6

Finally, the Transition Tree describes how to execute. Here, the interfaces, actions,
intermediate states and outcome results are depicted. The action plan TrT (‘how to change’) connects all the elements like the existing reality, an unfulfilled need, a specific action to be taken, an unexpected effect of the preceding three actions and the rationale of the need.

Insight into Evaporating Clouds

Crises and deadlocks, when they occur, have at least this advantage that they force us to think.

                                                      - Pandit Jawaharlal Nehru

Kelvyn Youngman has called the conflict shown in Fig 4 ‘The Lieutenant’s Cloud.’ Here the lieutenant wishes to perform a task but is stopped by a rule which prohibits him. D has something that we have, but we don’t want. And D’ has an action that we wish to take, but  cannot. It  is  quite  amazing  then that there is something negative in D, but we carry on suffering from it because it also satisfies a positive need (or so we feel) towards the achievement of the goal. At the same time, it is intriguing that knowing well about the good outcome of a positive change or action in D’, we continue to be paralysed, and fail to change. The result is a status quo because of our fear that if we take action at D’ (and change), it will jeopardise the need at B and the goal. It is here that verbalisation of our assumptions (which have made us believe a certain outcome) can help us in challenging some beliefs. Verbalisation can also help us to understand and strengthen a few assumptions which were only vaguely perceived hitherto.

                                                            Fig 4

Conventionally, the box D is used to write the UDE; an undesirable rule that blocks the action, we wish to take listed in D’. These two wants or actions are, therefore, naturally exclusive. Kelvyn Youngman suggests dividing the diagram with a horizontal line drawn from box A across. This virtually divides the space occupied by B and D from that of C and D’. The upper and lower part of the dashed line can now be seen as separating two different worlds of logic, as shown in the diagram. The conflict is created fundamentally because the local begins to influence the global view instead of aligning with the ‘MAIN’; short-term policies restrict long-term vision because of the fear of failure, the current affects the future adversely.

It’s Not a Compromise

This system of belief has one special approach. A solution does not lie in compromises as the outcome of compromises is further undesirable effects. The answer is not in giving up short-term gains totally to build avenues for long-term achievements. The resolution of conflict is not intended as one side giving up (lose-win); forcing the other side (win-lose) or even a compromise (lose-lose). The intended solution is win-win.

The quest is for a simple and elegant solution rather than a sophisticated one. According to Goldratt, “Human based environments are governed by simple common sense logic”. There is no conflict about the system goal and the needs when we set out to analyse. Only the assumptions either fulfilling or obstructing these needs may have inconsistencies, causing conflicts.

Simple can be harder than complex: you have to work hard to get your thinking clear to make it simple. But, it is worth it in the end because once you get there, you can move mountains.

                                                                                 -  Steve Jobs

The Maintenance Manager

The story of a conflict faced by the maintenance manager has been presented in Deming and Goldratt by Lepore and Cohen⁶. The conflict has been further explained by Kelvyn Youngman in his online guide⁷. This is the story of a conflict between the responsibilities and authority assigned to the maintenance manager. The maintenance manager is measured by the ‘uptime’ of his production infrastructure. But, he does not have the authority to buy the requisite spares. The spares are purchased by the purchase manager, who is measured by the least expenditure on purchases. Accordingly, he follows laid down rules for purchase of cheapest available spares. The conflict diagram is shown in Fig 5.

Fig 5

We can verbalise dependencies and assumptions as given below:

l   AB: In order to keep the company profitable (A), we need control on the purchase process (B), because increased purchase costs would reduce profits.
l   BD: In order to have control on the purchase process (B), we have to authorise only the purchase manager to buy (D), because only he can strike the best deal, following the laid down norms.

l   BD’: If the maintenance manager buys spares (D’), accountability would be lost and we cannot (jeopardy) exercise control over the purchase process (B).
l   BD’: If the maintenance manager buys spares (D’), he would wish to buy costly spares for his perceived reasons of reliability of spares and the control would be lost (jeopardy) on the purchase process (B).

l AC: In order to keep the company profitable (A), we need to have good quality spares (C) because good spares will give us high uptime and, consequently, higher production and profits.

l CD’: In order to have good quality spares (C), the maintenance manager must buy spares (D’) because only he can assess the quality.

l CD: If the purchase manager buys spares (D), we cannot (jeopardy) be assured of       quality (C), because he would go for the least price.

The assumptions can now be examined:

(i)    Is it true that only the purchase manager can strike the best deal?

(ii)   If the maintenance manager advises the purchase manager for spares (instead of  himself buying), will the control on the purchase process still be lost?

(iii) If the maintenance manager buys spares which are not the cheapest, will it really end up in costs going up so much as to bring profits down?

The first two questions throw up the solution that if the maintenance manager advises on spares purchase, the purchase process can be controlled by the purchase manager. And also that good quality spares can be purchased with the intervention of the maintenance manager. But, Kelvyn Youngman goes further to point out the following anomaly:

l Even if the maintenance manager advises the purchase manager for spares, the       accountability of both remains substantially diluted, as the responsibility gets       divided.

The answer to the above negativity can be provided by breaking the logical separation between D and D’. Now, the question (iii) also needs to be answered about profit really reducing if the maintenance manager recommends spares which are not the cheapest. The answer, therefore, lies in throughput accounting for the system rather than local optimisation for individual performances measures. In this case especially, it turns up as given below:

l   Good quality spares may increase the cost of spares.

l   But good quality spares will enhance uptime and reduce breakdowns.

l   Good quality spares will need fewer replacements.

l   Enhanced uptime will increase throughput of the system.

l   With increased Throughput (T), enhancement of profits can be ensured even if the Operating Expenditure (OE) goes up marginally (Profit = T - OE).

The change enables the maintenance manager to extend advice for spares purchase. But, he is now responsible for the throughput, which is systemic rather than uptime of machines. And in the purchase process, instead of only purchase cost being of concern, the operating expense which is a systemic parameter, now becomes the measure. So, the maintenance manager, while advising for spares, can be made responsible for both, maintaining high throughput as well as controlling operating expenditure. The purchase manager goes conveniently out of the conflict. Here, a further change in approach is possible if the functions of the maintenance manager turn more comprehensive to overall logistics. He would better buy spares following the laid down norms. The system block diagram would then reduce to the one shown at Fig 6 with no conflicts.

Fig 6

Is Indigenisation Our Goal?

At this point, it would be worth examining whether ‘indigenisation of the aerospace industry’ is our goal. If yes, we need to reaffirm that this is our collective goal - of the three participants: DRDO, industry (public as well as private) and Air Force. We may have to articulate it with assumptions for justification. We will also need to articulate the measure of accomplishment of our goal. Hypothetically, let me put down below a few words for each of the three elements as an academic exercise.

DRDO:   The organisation exists for the development of  indigenous  defence technology. The aerospace arena is no different. Indigenisation is the goal for the aerospace industry as well. However, for accomplishment of the goal, to a great extent, it depends on the users’ inherent acceptance of indigenous designs.

Aerospace Industry:   The DPSUs would also see indigenisation as their intrinsic goal. For its accomplishment, however, they would feel dependent on MoD support for Transfer of Technology (ToT), DRDO support for indigenous designs and users’  support for acceptance without being fussy. The private sector would see great opportunity for the aerospace sector in manufacturing, Maintenance, Repair and Overhaul (MRO) as well as services, beginning with an entry through defence offsets and then diversification. They would see the success as depending largely on promotion by the government, accommodation by DRDO and DPSUs, and in principle acceptance by the users.

Air Force: Indigenisation has been the Air Force’s especially focused effort for over two decades. There is genuine promotion of indigenous support in   everything. But, the Air Force carries the final responsibility—so, systems cannot be acquired and used just because of indigenous D&D if these lack an edge over globally available contemporary weapons. The private sector has to step in to undertake challenges with associated risks (we can also share). If they come up with good products, we are here to support them.

Every participant is zealous about indigenisation. But, everyone has strong reasons for non-achievement on account of shortfall on the part of someone else. The ‘problem is elsewhere’ syndrome permits everyone to remain locked in conflict. Original R&D, technology evolution and follow-up production are time consuming. Such systems cannot be indigenously available off-the-shelf to compete with the global giants. The private sector needs assurances from the R&D agencies and users. Ultimately, the Air Force is in a tight corner because all the risk is transferred to the user. In this conflict, the measure of success (indigenisation effort) is determined by each part to suit its own local logic. Each one makes an effort to optimise one’s own sphere within the local logic, hoping that global benefits would naturally accrue. On the contrary, without the constituents being conscious of it, the global conflict continues to exist. Therefore, for all three constituents
it would be pertinent to identify and align with the global goal. Then, together as they diffuse the conflict in the logic, they can also find measures of achievement, which also align with the systemic measures.

Whose Need is it?

Peter Senge reminds us⁸ about our mental models and experiences from the past which shape up our behaviour. In a situation of conflict, we are locked between the local view and the system or global view. The lock gets tighter as we develop our  measurement  yardsticks  conforming  to  our  local  or  departmental  needs.
The department doing well by these yardsticks is delightfully satisfied under the assumption that the system optimum is a mere arithmetic sum of the local optima. We stay firm in our local view, in a state of conflict with the global needs - locked in our current state without gathering courage to change the future - fixations of the kind that if we don’t continue with the present approach, the situation may worsen, actually paralyse us. The vital thing pointed out by Kelvyn Youngman is that we apply the logic of our department to the whole system, and fail to adopt the system’s logic for the parts. Actually, most often, we are not even aware of it, believing “my department’s local view is God’s own view”.

“God’s view” brings me to the fundamental question of ‘whose need is it anyway’? I recall an experience when a renowned swamiji came to address us at the College of Defence Management (CDM). In just a few minutes, he introduced us to the fundamental conflicts in life as he explained the ‘dog pattern’ and ‘cat pattern’ of human behaviour. A dog and a cat separately live happily, very well taken care of by their respective masters. But their views of life are entirely different. The dog acknowledges that it is blessed with great life under the care of its master because the master is God. On the other hand, the cat believes that it has a great life and, is taken well care of because it is God. I venture to suggest that ‘I am God’  is well entrenched in the local view projected by everyone of us. We continue to suffer from this myopia with a sincere belief that my view is the system’s need. As per the Theory of Constraints, the system’s logic has to be applied to all parts. And all parts have to be subordinate to the system’s needs which are governed by the constraint.

Maturity Levels of Air Power

In my opinion, there are three distinct levels of aerospace power equations. These are governed by the state of maturity levels and predominance of the three participating elements as shown below.

Fig 7

 l  Air Power with Local Influence 

m     Air  Force  assets,  management,  training  and  operational  preparedness  are       predominant elements which determine the level of influence.

m       Indigenous R&D and industry are insignificant.

l       Regional Influence

m     The Air Force remains proficient and agile and derives strength for maintenance          and upgrades backed by strong R&D and industry.

m     Indigenous R&D and industry begin to play an increasingly significant role.

l       Global Influence

m     Indigenous R&D and industry assume predominance and enable the Air Force       first use of the globally best technology.

m     The Air Force gains further proficiency and agility strategising the use of hi-    tech forces while validating tactics under indigenous control.

The Indigenisation Clouds

Logic and Intuition

An intuitive mind is a sacred gift and a rational mind is a faithful servant. We have created a society that honours the servant and has forgotten the gift.

—Albert Einstein

Before drawing indigenisation clouds of conflict and even remotely attempting to indicate a possible strategy for evaporating these, I should clarify the following few things explicitly.

l This is not merely elementary arithmetic that a consultant can use to break logic and provide straight answers.

l Goldratt suggested that logic itself was not enough. You must have system experience       also. Without intuition, no logic can help.

 l A consultant can, at best, lead participants into a solution method. The participants       themselves,  sitting  together,  draw  clouds  and  reality  trees  and  then  verbalise       assumptions, validate, check for negative branch reservations to work out a win-           win  solution.

l Here, only a representative method is being put up. The real analysis is only            possible when those currently in business apply themselves intuitively to relate           with the current reality (tree) that exists.

The Undesirable Effects

The formulation of the problem is often more essential than its solution, which may be merely a matter of mathematical or experimental skill.

— Albert Einstein

The following is an attempt to list out the Undesirable Effects (UDEs) in the process of acquisition and indigenisation. These are only academic to represent a process wherein a few participants from different areas would sit together to voice their concerns without assigning causes, pointing blame or giving instant solutions. The UDEs are also not listed
in any sequence.

l     We can’t get state-of-the-art weapon systems from Indian manufacturers.

l     The General Services Qualitative Requirements (GSQRs) are often unrealistic.

l     The requirements go on changing.

l     Adversaries are raising their potential steadily.

l     Our assets are getting obsolete.

l     Users are unable to gather courage to try out indigenous designs.

l     We have tremendous hurdles in operationalising indigenous products.

l     We are under pressure to modernise.

l     Life cycle cost of foreign acquisitions is high.

l     After foreign purchases, we remain dependent for maintenance.

l     We get stuck for spares even in cases of licensed manufacture.

l     Foreign procurements take a long time.

l     We have to buy from foreign sources.

l     We are unable to build indigenous capability.

l     Cost of spares and support is high for foreign weapon systems.

l     Delays in indigenous projects upset our plans.

l     We are unable to get indigenous products to meet our specifications.

l     We are unable to get the desired support from DPSUs.

l     DRDO has not been quite productive in the aerospace sector.

l     We have no model to promote the indigenous private sector.

l     DPSUs are neither treated as partners nor independent suppliers.

l     DPSUs have little flexibility in costing products.

l     DPSUs have to absorb uncertainties of vaguely contracted buy/make projects.

l     We are unable to maintain high serviceability for most fleets.

l     Weapon systems are becoming costlier by the day.

l     ToT for manufacture or overhaul is not adequate to stand up on our own.

l     Every major contract goes only to DPSUs.

l     We are unable to get adequate control over foreign suppliers after production of

DRDO designs.

l     We have not been able to derive tangible benefits from the offsets policy.

l     We are unable to get the right response and efficiency from DPSUs.

l      The aerospace market is limited to the military.

l      We are unable to feel secure in a long-term relationship with the private sector.

l      We are unable to find a robust method of costing of private sector products.

l      We cannot promote a few reputed companies only.

l      Budgets remain tight.

From the above list of UDEs, a Current Reality Tree would be drawn providing a flow from causes to effects. Where required, additional blocks with statements not otherwise contained in the list of UDEs would be added. These steps have been avoided here because they involve details and also because analyses without the involvement of specialists may not truly represent reality. It suffices to say that the Current Reality Tree would throw up a few UDEs which would determine most others. These are the constraints we would need to focus on. As an academic exercise, I will pick up the following two examples as core constraints:

l        Foreign procurements have inherent dependency.

l        We have no model to promote private sector indigenisation.

“Foreign Procurements have Inherent Dependencies”. The cloud for this UDE can be drawn as shown in Fig 8.

Fig 8

The assumptions may be listed out as shown below:

·         In order to be a dominant air power, we need state-of-the-art systems, because an edge over adversaries’ weaponry is necessary.

·         In order to meet the need for state-of-the-art systems, we have to procure from foreign sources because only foreign manufacturers have such systems for sale.

·         If we buy indigenous systems, we cannot (jeopardy) satisfy the need for state-of-the-art systems, because we have to usually compromise on desired specifications.

·         If we buy indigenous systems, we cannot (jeopardy) satisfy the need for state-of-the-art systems, because indigenous developments involve undue and uncertain delays.

·         In order to be a dominant air power, we need enhanced indigenous capability, because it would enhance logistic support and fleet availability.

·         In order to be a dominant air power, we need enhanced indigenous capability, because it would provide us with flexibility to exploit systems.

·         In order to be a dominant air power, we need enhanced indigenous capability,because we can assist friendly neighbours.

·         In order to have enhanced indigenous capability, we must buy from indigenous sources so that indigenous R&D and industry can follow up.

·         If we buy from foreign sources, we cannot (jeopardy) enhance indigenous capability, because we will always get limited visibility into designs and special manufacturing processes.

·         If we buy from foreign sources, we cannot (jeopardy) enhance indigenous capability, because we will continue to be tied up with licensed manufacture at best.

   As we begin to examine assumptions, conflicts will begin to dissolve with                  questions as shown below:

·         Do we need all systems to be state-of-the-art?

·         Do budget restrictions not make us look for a portion of inventory which is affordable  and may be a generation older than top of the line?

·         Can defence R&D and production adhere to timelines in case of projects where  technology is within reach?

“We Have No Model to Promote Private Industry” This conflict Cloud can be depicted as shown in Fig 9.

       Fig 9

The assumptions could be as listed below:

·         In order to be a dominant air power, we need assured support at reasonable cost, because logistics govern fleet availability and consequent power to exploit systems.

·         In order to be a dominant air power, we need assured support at reasonable cost, because revenue expenditure has to be kept in check.

·         In order to have assured support at reasonable cost, we must have major contracts with only DPSUs, because the MoD has control over these.

·         In order to have assured support at reasonable cost, we must have major contracts with only DPSUs, because we can verify their costing methods.

·         If major contracts are given to the private sector, we won’t (jeopardy) be assured of support at reasonable cost, because once secure in business, companies will arbitrarily raise prices.

·         If major contracts are given to the private sector, we won’t (jeopardy) be assured of support at reasonable cost, because companies can arbitrarily withdraw support if not viable.

·         In order to be a dominant air power, we need enhanced agility of response because better logistics support would enhance fleet availability.

·         In order to have enhanced agility of response, we need contracts with the private sector, because the private sector has inherent flexibility.

·         If major contracts are with the DPSUs, agility of response is lost (jeopardy) on       account of bureaucratic delays and interferences.

·         If major contracts are with the DPSUs, agility of response is lost (jeopardy), because       public sector companies have inherent inefficiencies.

The assumptions could be questioned as shown below:

·         Can we have a shortlist of reputed private companies, which can be considered for major contracts? All others can join in as sub-contractors.

·         Can we not develop a model for engaging the private sector, so as to get listed companies committed with assurances through contracts?

·         Can we not develop a suitable model of costing and partnership with trust? Can the  costing models be revalidated periodically?

·         Can we look for joint ventures to derive benefits from both public and private sector strengths?

Evaporating clouds would take us through to identification of the problem. The next few steps, as discussed earlier will, assist the change teams to eventually develop a solution. TOC did not, however, limit itself to only clinically finding out a solution for the identified problem. The implementation obstacles at each step were recognised and layers of resistance advised as listed below:

·         Don’t agree with the problem.

·         Don’t agree about the solution.

·         Have reservations (negative effects).

·         Implementation obstacles.

·         Unverbalised fears.

The biggest resistance we face right in the beginning is in acceptance of the problem itself. It is most common to find a situation where an organisation wishes to hire a consultant to first identify the problem and accordingly suggest a solution. This approach is sure to fail because the most concerned remain unaligned with the whole process of identification of the problem, its solution and the implementation method. Therefore, at the national level, it is vital to first accept that we have a problem. Only then, can a task group find solutions, whichever method it uses.

Before I conclude, I must clarify that enhanced indigenisation of the aerospace industry cannot expect cessation of all foreign industrial activity connected with aerospace in India. Today, no worthwhile industrial house can be tagged with one nationality. Industries have truly gone global, taking advantage of the ability to establish different processes or divisions of business at different places around the world. The current global equations govern that no large industry anywhere in the world can remain profitable if it is completely indigenous for all parts. Accordingly, indigenisation of the aerospace industry in India should strive to create interdependence with foreign sources where Indian defence interests are legitimately protected, bringing substantially increased strategic independence.

             Give me a lever long enough and a fulcrum on which to place

             it and I shall move the world.

                                                                                  - Archimedes

Archimedes told us of the importance of the high leverage point. Peter Senge tells us⁸ about an example of ‘trim tab’ to explain the big effect with a small effort. That is mathematical. But, Peter Senge also tells us about these high leverage areas in every system being the least obvious. The theory of constraints tells us that the core constraint is the place to act. In my opinion ‘our inability to develop a model to involve the private sector in a major way’ is the core constraint for the indigenisation of the aerospace industry. We have to pull ourselves out of the paralysis, push the fear out, and act. We can effect a change if we begin with sincere acceptance of the problem and break conflicts to implement win-win solutions.

References

1.   Air Cmde Jasjit Singh, Indian Aircraft Industry (New Delhi: KW Publishers Pvt Ltd, 2011).

2.   E. M. Goldratt and J. Cox, The Goal (The North River Press, 1984; Reprint by Productivity &
        Quality Publishing).

3.   E. M. Goldratt, Goal II -It’s not Luck’ (The North River Press, 1994; Reprint by Productivity
  & Quality Publishing).

4.   E. M. Goldratt, Critical Chain (The North River Press 1997; Reprint by Productivity & Quality
  Publishing, 2012).

5.   E. M. Goldratt, Theory of Constraints (The North River Press, 1999).

6.   Dr. Kelvyn Youngman, “Online Guide in Implementing TOC 2008-2009,” //www.dbrmfg.
  co.nz

7.   Domenico Lepore and Oded Cohen, Deming and Goldratt (Reprint by Productivity & Quality
  Publishing, 2010).

8.   Peter Senge, Fifth Discipline (1990, London: Reprint by Random House, 2006).