Designing for cost

Commercial common sense without compromising capability in warship design.

Warships are, for the most part, bespoke items. Low production runs, unique requirements, tightly defined specifications combined with a need for exceptional capability and reliability has traditionally meant that off-the-peg solutions have never been seen as acceptable.

Is cost an issue?

However, as financial pressures increase on everyone involved in warship procurement from government agencies and defence departments through major commercial entities to the smallest systems subcontractor, new approaches are being taken to ensure that cost reduction does not necessarily mean a reduction in capability. BAE Systems Naval Ships is developing this approach and ensuring that cost reduction can become an integral and beneficial part in the process of designing, building and supplying some of the most complex vessels afloat.

The traditional view is that cost reduction is a matter for the financial and procurement functions of a business, i.e. simply a matter of striking a better deal. Designers and engineers were tasked with meeting customer technical specifications and their focus was on ensuring above all else, that designs provided the required capability.

The designing for cost principle suggests that low cost cannot be ?managed? into a product, it must be ?engineered? into a product. If designers and engineers are involved at the earliest stages and kept aware of the financial implications of decisions then cost-consciousness becomes embedded in the entire design process.

Designing for cost

should be driven by engineers, not accountants.

Designing for cost

Designing for cost

(DFC) can be defined in many ways but the essential and underpinning principle is that it is proactive ? it is the conscious use of the engineering process to reduce life cycle costs.

It places engineering decisions rather than management decisions at the centre of cost reduction activity. For example, rather than undertaking iterative redesign of a project until the content meets a given budget, it seeks to design a product only once. If these design choices are actively made by engineers, rather than being forced upon them for cost reasons, then rework can be minimized.

This approach also directs more responsibility for quality control to the engineering function. A ?design for cost? approach may also take into account life cycle costs to the customer and adjust the design accordingly.

DFC, and the product delivery process, rewards simplicity while complexity increases cost and modern warships are incredibly complex. To design complex vessels and integrate numerous cutting edge subsystems, including weapons, navigation and propulsion, requires a great deal of confidence in the design and engineering process.

This reorientation of the engineering process can be a significant undertaking and has two strands.

The first is attitude. Creating an environment that fosters consideration of cost in the design process. In some organizations this may involve not only re-educating engineers but also others around them.

In many organizations cost information is seen as too sensitive to share widely with the design population (particularly at a working level). More generally there may a lack of communication between designers, cost estimators, procurement and manufacturing. This can lead to poor understanding of the cost implications of the design choices being made with little understanding of how this will impact on the programme as a whole.

The second is implementation. A number of tools are available for an organization wishing to take a DFC approach, some of which may already be available. These include, but are not limited to, ?design for manufacture and assembly? (DFMA), ?concurrent engineering?, ?activity based costing? and ?quality function deployment (QFD). As more emphasis is placed on controlling through-life costs, elements of a ?design for support? approach will also form part of the toolkit used by engineers.

Looking at QFD in more detail, one can see the advantages of using a structured system engineering process to aid planning. It derives requirements and ranks them in terms of customer values while providing a framework for tracking changing requirements. By creating this framework it also helps to identify key system?s parameters which should be optimized enabling effective and controlled trade-offs where they have to be made.

Why are we doing this?

BAE Systems Naval Ships is one of the major suppliers of warship capability to the UK Ministry of Defence. Their facilities on the river Clyde in Glasgow supplied the majority of the Type 23 Frigates currently in service and they are responsible for the Type 45 anti-air warfare destroyer contract, the future backbone of the Royal Navy. The company is also involved in the production of ?landing ship dock? vessels for the Royal Fleet Auxiliary and hopes to play a significant role in the new aircraft carriers project.

Naval Ships is also a major supplier of vessels to the export market and it is here that the commercial savings of adopting a design for cost philosophy can pay handsome dividends.

When working for the Royal Navy, BAE operates within a number of strict parameters that govern technical specifications, operational requirements and the type of equipment that can be used. Export work allows more freedom to define the nature of the product offered since it is here that the company?s skills in design, systems integration and contract management as well as engineering and production, enable extremely complex vessels to be built. In order to be competitive, BAE needs to develop designs that meet the requirements of customers, and that can be offered at a price that the market perceives as value for money. To do this, the shipbuilder needs to examine various aspects of its proposed solutions and DFC becomes a useful philosophy to employ.

Standardisation

BAE has developed a portfolio of designs that allow it to tailor solutions to the specific needs of a customer while retaining the underlying strengths of proven hull forms. For example, the F2000 generic frigate forms the basis for a number of designs. Currently, the company is completing an order for three ?offshore patrol vessels? for the Royal Brunei Armed Forces and these vessels are based on a 95-metre hull. In recent years the shipbuilder has also supplied a pair of similar vessels to Malaysia measuring 106 metres long which have a helicopter hanger. Developments are in progress for a variant of the design that is similar to the Brunei ships which includes a helicopter hangar.

Many of the key aspects of these designs were similar and consequently did not need to be reworked from first principles and benefited from having a flexible core design. The principle of DFC and the benefits of standardization do not only apply to complete ships or large items. Equipment such as storage cupboards, lockers and bed frames has, in the past, been made on an as-required basis to non-transferable designs. A number of catalogues of standard designs that can easily be assembled and fitted have been developed and this approach, alongside the expected productivity benefits of longer production runs, enables design decisions to be simplified.

Commercial standards

The culture of ?over-specing? can extend beyond key systems that are essential to the ship?s operational or fighting capability into secondary systems. Is redundancy needed, for example, on portable apparatus supplies in the crew quarters? Perhaps not. This recognises that you can reach a stage where the increased cost and complexity of fitting a ?multiple redundancy? system is not rewarded with a consequent increase of utility.

There is a move towards the use of commercial, rather than military, standards in some of the ships? systems where appropriate. This in no way diminishes the importance of providing ships of a high standard but simply recognises that a system can be fit for purpose without being built to highest military specifications.

Rather than viewing the decision process as military versus civilian, it is more appropriate to view this as a sliding scale, i.e. how far do you want to go before you begin to trade capability? How much capability do you actually need from a given system? By examining commercially available alternatives to certain systems, and by being clear on the actual system requirements in a design, one can ensure that engineering decisions can be made that can have a positive impact on costs.

Relationships

In addition to discussing the cultural changes that are necessary within engineering populations and within companies as a whole, it must also have the willing participation of two other key groups, i.e. customers and suppliers, for the process to be effective.

Dealing with a company operating on a DFC principle should not be an onerous task for any customer as it offers more transparency and the opportunity for balanced dialogue about capability. The focus on establishing design requirements early in the process also offers an opportunity for the customer to firm up its requirements before there are any cost implications for either party. This structured approach offers a checklist and ensures that customer requirements are clearly defined, understood and ranked in terms of customer value which can then be translated into system specifications, accurately costed and traded-off.

The various categories of systems required in a ship have to be looked at and this will tailor the shipbuilder?s approach to suppliers and subcontractors accordingly. Supply of a high-value item that is essential to the efficient functioning of the vessel will be considered differently to supply of a relatively low-value commodity item and the contractual arrangements will reflect this.

Contractors and suppliers

Within BAE Systems Naval Ships, the company is operating a ?lean? prime contract office model that separates the responsibility for managing a contract from the responsibility for delivering it. This separation can be applied to internal groups (e.g. the operations or production function within a business) or with external suppliers.

The effect should be the same; clearly defining what is required, making the individual or company responsible for delivering what they have agreed and then empowering them to do it. By re-examining an element of a contract and establishing ?what do we need this to do? and offering a supplier some flexibility as to how they deliver it, can often lead to more cost-effective solution being found.

It?s not ?rocket science?

Few of the principles outlined here are inherently difficult or new but the challenge lies in ensuring that the culture change is achieved. Modern warships are some of the most sophisticated fighting machines on earth and these vessels are capable of operating in high-risk environments, with significant degrees of automation.

While this operational complexity cannot be avoided, design of these systems can be streamlined, standardized and simplified to ensure high performance levels, provide capability but at the same time provide value for money. For those on either side of the partnership to accept a new approach that says ?simplify? may be a potentially revolutionary change but, in an era of escalating defence costs and greater demands for value, it may prove to be an essential evolutionary leap.