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We can no longer conduct business as usual

By Skies Magazine | June 7, 2024

Estimated reading time 5 minutes, 43 seconds.

Rich Foster, vice-president of L3Harris Technologies Canada, has long been a prominent voice in the Canadian defence aerospace industries. A former Deputy Commander of the Royal Canadian Air Force, who served for 35 years, he has long argued for changes to defence procurement.

On Thursday, May 30, Foster addressed the attendees of CANSEC, an annual trade show hosted by the Canadian Association of Defence and Security Industries, emphasizing the urgency of adapting to the evolving landscape. With geopolitical tensions, technological advancements and environmental challenges reshaping the world, he underscored the critical need for industry and government to work together more efficiently and decisively. Below are excerpts of his remarks in which he outlined some initial areas where he believes industry and government must collaborate to navigate the complexities of modern security challenges.

Rich Foster, VP of L3Harris Technologies Canada. JVL Photo Courtesy of CADSI

CANSEC represents a significant opportunity for Industry and government to meet and engage. An opportunity that is only increasing in importance as we continue to witness a world of conflict, climate change and, unfortunately, a continued decline in liberalism. As of October last year, the on-going conflict in the Middle East has added to these challenges. The threats to our national security, to our supply chains, to the sovereignty of our allies, and to our economy, only continue to intensify. We all feel the impact brought on by these threats and recognize that we are not trending in the right direction.

Compete when you need to compete, and not for the sake of competition. The cost of competition is high from a money, schedule and risk perspective. The processes involved are only becoming more complicated. How do we get to a place where both industry and government are comfortable with a direct sole-source decision or a competition that is limited to a few companies asked to bid, when it is evident that this is the right course of action? How does industry help government establish the criteria? I can tell you that combat has a way of inspiring decisiveness, and I would suggest that world events should be inspiring us to be a little more decisive.

Avoid high-risk developmental programs that are firm-fixed price. L3Harris’ CEO has publicly stated that we will not bid on these types of programs, and I know of three occasions where this occurred in the past year. Low bids to win a fixed price developmental program do not fully consider the internal R&D costs, put the company in the red, and lead to higher costs, lower value, late capability for the customer. We must better define the concepts of developmental programs and understand the implications. How can industry help government to better understand the developmental nature of an offering? How is this encapsulated in an RFP and subsequent contract?

Canadian industry should be more integrated in a U.S.-led North American supply chain. Our greatest ally and largest, and closest, trading partner is gearing up to counter the Asia-Pacific, European, Arctic, climate, cyber and ideological threats against the western world. Canada should look for ways to better integrate our industrial base with the U.S. while preserving those national capabilities that are more competitive and ensure our sovereign operational readiness. Better alignment with the U.S. will ensure that we are interoperable with all our allies in NORAD and NATO. That is not to say that Canada should ignore other NATO countries, but that we should look to North America first and foremost.

R&D investment within Canada should be longer-term and more focused. It should also support those capabilities that have the best chance to succeed in a competitive global market. We should target those competitive competencies that differentiate us from our allies and invest appropriately. A longer-term defence R&D partnership with Canadian industry would help our industrial base compete.

Given the current global situation, I believe that we can no longer conduct business as usual. Many of my industry colleagues are willing to engage and work with government to resolve some of these issues, ensuring we remain competitive while providing the right equipment to the men and women in our Canadian Forces and defence and security teams.

These are some thoughts for you to contemplate during the day.

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