BUSINESS CASE FOR NCI AGENCY "EXTERNAL CUSTOMER ...

NATO UNCLASSIFIED NCIA/DM/2016/02365

A Ney NATO Communications and Information Agency Agence OTAN d'information et de communication

BUSINESS CASE FOR NCI AGENCY

"EXTERNAL CUSTOMER SUPPORT MODEL"

BUSINESS IMPROVEMENT INITIATIVE

(Within the framework ofthe Business Improvement Plan / Sourcing Plan aligned to the Strategic Plan in response to NATO priorities and ASB Strategic Direction and Guidance)

Project NCDOl167: "Adaption of External Customer Support Model Study"

[Project Manager: Eric Lievre, Chief SP&CRM and Lead for trial ECSO]

Effective Date: 4 November 2016

Issued by: Dr Velizar Shalamanov, Director Demand Management, NCI Agency

Approved by: Murray Davidson, Director of Change, NCI Agency

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Enclosure 4 toNCIA/DM/2016/02367


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Table of Contents

References .............................................................................................................................................. 3

Glossary ................................................................................................................................................... 4

Executive Summary ................................................................................................................................. 6

Introduction ............................................................................................................................................ 8

Business Improvement Initiative .......................................................................................................... 11

Scope of Business Case ..................................................................................................................... 11

Current State ..................................................................................................................................... 11

Problem ............................................................................................................................................. 13

Opportunity....................................................................................................................................... 14

Options and Recommended Solutions ................................................................................................. 16

Goal and Principles of Options Development ................................................................................... 16

Options Considered .......................................................................................................................... 17

Recommended Solutions .................................................................................................................. 19

Risk Factors & Mitigation .................................................................................................................. 21

Financial and Legal implications ....................................................................................................... 22

Final Recommendation (Proposal) .................................................................................................... 22

Annex A: External Customer Support Office Background ..................................................................... 24

Annex B: Pugh Matrix ........................................................................................................................... 26

Annex C: Workshop Requirements ....................................................................................................... 28

Annex D: CSM’s Attributes .................................................................................................................... 31

Annex E: SWOT Analysis ....................................................................................................................... 32

Annex F: Workshop Stakeholder Key Findings ..................................................................................... 34


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References 1. North Atlantic Council Meeting: Warsaw Summit Communiqué, 8–9 July, 03 August 2016. 2. NCI Organisation (NCIO) Charter, 2009. 3. NCI Agency Supervisory Board Strategic Direction & Guidance, 01 August 2016. 4. NCI Agency Business Strategy 2017 – 2019, August 2016. 5. NCI Agency External Customer Support Model Adaptation Business Case, August 2016. 6. NCI Agency Business Case Lean Change Request Process, 2016. 7. NEDP NATO First Report, May 2016. 8. NCI Agency Demand Plan 2017 - 2019, August 2016 9. NCI Agency Financial Plan 2017 - 2019, August 2016 10. NCI Agency Business Plan 2017 - 2019, August 2016 11. NCI Agency Customer Satisfaction Assessment 2015, May 2016. 12. NCI Agency ECSM Adaption Study, NCIOC Phase 3; Workshop Read Ahead Pack. 13. NCI Agency ECSM Adaption Study, NCIOC Phase 3; Workshop Outbrief, September 2016. 14. External Customer Support Office (ECSO) Execution Report 2016, NCIA/DM/2016/02338/TT-3048,

14 October 2016. 15. NCI Agency Annual Report 2015, NCIA/SSTRAT/NLO/2016/08394, 07 June 2016. 16. NC3A Manual on the Implementation of Cooperation Service, NC3A/DSA-NN/2012/116, 28 June

2012. 17. NEDP Smarter Smart Defence, Multinational Cooperation Facilitated by the NCI Agecny and NSPA,

2014.


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Glossary Acronym Definition

ASB Agency Supervisory Board AM Account Managers BOA Basic Ordering Agreement BRM Business Relationship Manager CFRp Connected Forces Readiness program C&I Communication and Information

C&IP Communication & Information Partnerships CIOC Chief Information Officers’ Conference CIS3 CIS Security Standards

CMRE Center for Maritime Research & Experimentation CRF Customer Request Form

CRO’s Crisis Response Operations CRM Customer Relationship Management CSF Customer Satisfaction Form CSC Customer Services Catalogue CTO Chief Technical Officer DDM Director Demand Management

EC External Customer ECSM External Customer Support Model ECSO External Customer Support Offices eFP enhanced Forward Presence

eNRF enhanced NATO Response Force FMN Federated Mission Networking

iECSM External Customer Support Model iPOW Internal Programme of Work

MN ADAPT Multi-National Alliance Defence Analysis and Planning for Transformation MNC Multinational Core

MN CD2 Multinational Cyber Defence Capability Development MND Multinational Division

MN POW Multinational POW MNP&O Multinational Project & Organization MYPOW Multi-Year POW

N1S NATO First Solution NCOIC Network Centric Operations Industry Consortium

NCS NATO Command Structure NFIU NATO Force Integration Unit NfP Not For Profit NFS NATO Force Structure

NI:SAFE Interoperability: Secure, Affordable, Fast and Easy way NSPA NATO Support & Procurement Agency PM Project Manager PO Purchase Order

R&D Research and Development RAP Readiness Action Plan

RASP Regional Airspace Security Programme SME Subject Matter Expert SSP Service Support Packages


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SWOT Strengths, Weaknesses, Opportunities and Threats TF Trust Fund tFP tailored Forward Presence ToR Terms of Reference

USAREUR US Army Europe VJTF Very High Readiness Joint Task Force


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Executive Summary As follow-up from the 2016 Warsaw Summit (Ref 1), the execution of the ‘Post-Summit Implementation Plan for Deterrence and Defence’, to start in 2017, will result in a significant increase in the number of requests from External Customers as well as an expansion in External Customer base. Furthermore the Agency Supervisory Board (ASB) issued Strategic Direction and Guidance for the NCI Agency (Ref 3) mandating that Agency should ‘give priority to the provision of CIS services to the NATO enterprise’ and the ‘Agency shall ensure that any additional activity outside its core business, i.e. for non-common funded entities, will not adversely impact its core business’. Consequently, in order to address these challenges, the NCI Agency took actions to improve the effectiveness and efficiency for delivering affordable C3 capabilities and IT services to External Customers based on NATO Interoperability: Secure, Affordable, Fast and Easy way (NI:SAFE) in support of NATO First Solution (N1S) for Federated Mission Networking (FMN).

One action was to initiate a study, led by the NCI Agency Demand Management (DM), to adapt the Agency’s External Customer Support Model (ECSM) in order to better deliver products and services to External Customers based on NI:SAFE principles, in order to meet NATO’s deterrence and collective defence objectives, without adversely impacting core business from common funded entities (Internal Customers).

The ECSM Adaption Study followed a four phased approach: • The first phase, Phase 1, was independently conducted by Network Centric Operations

Industry Consortium (NCOIC) and identified three adaptable Industry Customer Support Models (CSM) based on ‘best industry practices’. For ease of distinguishing between the three models, easy-to-remember names were assigned, representing the relative amount of effort to transition from the NCI Agency Current CSM to one of the three patterns of industry: ‘Step’ (Option 2), ‘Stretch’ (Option 3) and ‘Leap’ (Option 4).

• In parallel the second phase, Phase 2, conducted by the NCI Agency, reviewed the Agency’s current ECSM (Option 1: ‘As-is’ model) to identify areas where the extant model does not satisfy External Customer support requirements.

• The proceeding phase, Phase 3, was an independent NCOIC facilitated workshop during which key cross functional ECSM stakeholders analysed the NCI Agency’s As-Is CSM and the three identified industry CSM’s and selected the optimum solution by assessing each CSM against ECSM requirements that were formulated based on a review of ASB Strategic Direction and Guidance.

The industry ‘Stretch’ CSM resulted in being the most appropriate CSM to meet External Customers demand without adversely impacting core business from Internal Customers. This CSM is a Service Company with a separate group for handling special Customer Requests, maintains a simple organizational hierarchy and structure and is governed by several detailed policies and procedures.

Based on the outcome of the ECSM Adaptation Study, Demand Management proposes approval of:

• The Business Case for NCI Agency ‘External Customer Support Model’ Business Improvement Initiative;

• The development of an External Customer Support Model Road Map detailing the design and the steps required to implement the ‘Stretch’ model (option 3) within the NCI Agency. The


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ECSM Road Map will be presented to the NCI Agency EMB for approval and subsequent authorisation in November 2017;

• The initiation, under the authority of the NCI Agency General Manager, of a trial implementation of an Interim External Customer Support Model (iECSM) starting in January 2017, based on the “Step” model (Option 2) identified as a required transition step towards the “Stretch” model. This interim solution enables transition and will improve the current situation and provide valuable information for the developing the design of the detailed roadmap of the ‘Stretch’ model.

This business case provides further information for the current situation, problem, opportunity, identified options, goal and principles for improvement and proposed course of action to be considered. This proposal is in line with NCI Agency Business Strategy (Ref 4) that is based on the ASB’s Strategic Direction and Guidance (Ref 3) and addresses single accountability for support of External customers.


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Introduction At the 2014 Wales Summit, NATO agreed to measures aimed at bolstering the confidence of our Allies. Through the Readiness Action Plan (RAP), NATO set out to significantly increase its ability to reinforce its Allies in the East and the South with a much larger NATO Response Force (NRF) and a quick-reaction Spearhead Force. While Wales represented NATO’s initial response, the 2016 Warsaw Summit (Ref 1) set out a long term strategy and agreed to increase our Forward Presence in the Eastern and the South-Eastern parts of the Alliance, which is respectively ‘enhanced Forward Presence (eFP)’ and ‘tailored Forward Presence (tFP)’.

A 2016 Warsaw Post-Summit implementation plan for work on deterrence and defence has been developed, including (but not limited to) the following strands:

1. Follow-on Readiness Action Plan-related work, in particular Training of Follow-On Forces, Logistics and the Future of Assurance Measures,

2. Implementation of the eFP (including Command and Control), 3. Implementation of the tFP in the Black Sea regions (including additional Air and Maritime

elements).

The implementation of the plan, to start in 2017, will result in an expanded customer based and significant increase in the number of C3 capabilities and IT services Customer Requests for the NCI Agency. In addition, as these requests will be interrelated, the management of interdependencies between projects within the external customer portfolio will be a critical success factor.

Furthermore the Agency Supervisory Board (ASB) issued Strategic Direction and Guidance for the NCI Agency (Ref 3) mandating that Agency should ‘give priority to the provision of CIS services to the NATO enterprise’ and the ‘Agency shall ensure that any additional activity outside its core business, i.e. for non-common funded entities, will not adversely impact its core business’.

In line with the Strategic Direction and Guidance from the ASB (Ref 3), the Agency commenced the preparation of a Business Strategy 2017-2019 (Ref 4) as a step to the required Business Plan and the Agency Business Improvement initiatives that identified the requirement to appoint and empower a mandated single owner for each programme of work (ACT,C3S, ACO, NSIP, External Customers, Operations & Exercises). The owners are to be accountable to the respective tasking and funding organisation for the correct and timely planning and reporting of the respective programme and for the correct execution. External Customers will be treated as a portfolio of projects, allowing for a clearer focus and rolling planning of resources and commitments and a more effective and timely resolution of priority conflicts amongst the full set of programmes. Given the current environment and objectives set forth in the NCI Agency Annual Report 2015 (Ref 15), the NCI Agency took actions to improve the effectiveness and efficiency for delivering C3 capabilities and IT services to External Customers based on NI: SAFE principles in support of NATO First Solution (N1S). One of the actions has been to initiate a study to adapt the Agency’s ECSM in order to better deliver products and services to External Customers, to meet NATO’s deterrence and collective defence objectives, without adversely impacting core business from common funded entities (Internal Customers). This effort is funded by the prioritised Internal Programme of Work (iPOW) that aims to improve support to Nations and NATO Force Structure (NFS).


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This Business Case considers the 2016 Warsaw Summit measures, ASB Strategic Direction and Guidance (Ref 3) and subsequent NCI Agency Business Strategy 2017 -2019 (Ref 4). The aim of presenting this business case for approval in November 2016 is to seek agreement for the development of a detailed ECSM Road Map that will be based on a proposed ECSM solution determined by ECSM stakeholders during an ECSM Selection Workshop held in September 2016. The ESCM Road Map for achieving ECSO Full Operational Capability (FOC) will be presented for approval by the EMB in November 2017 and authorisation for implementation in 2018. Meanwhile an iECSM will be implemented under the authority of the NCI Agency General Manager as part of business improvement steps as of 1st January 2017.

External Customer Support Model Study The ECSM Adaption Study was initiated to identify ‘best commercial practices’ in the context of reviewing Industry CSM’s. Indeed, even if the status of the NCI Agency is very specific compared to Industry, NCI Agency’s engagement with Customers and ability to satisfy them should be very similar to what is done in the Industry or National Agencies. The ECSO Model Adaption Study is broken down into four phases (Ref 5):

Figure 1: ECSM Study Flow Diagram

Phases 1-3 are now complete and summarised below: • Phase 1: Review of Industry Customer Support Models

This phase was independently conducted in parallel with Phase 2 by NCOIC and reviewed adaptable Industry CSM’s that serve small, medium and large value contracts.

• Phase 2: ECSM Current State Review & Requirements Simultaneously with Phase 1 this phase was conducted by the NCI Agency and reviewed the Agency's current ECSM to identify areas where the extant model does not satisfy External Customer support requirements. Further ECSM requirements were developed based on a review of ASB Strategic Direction and Guidance and the current NCI Agency CSM.

• Phase 3: Gap Analysis & ECSM Selection Workshop In an independent NCOIC facilitated Workshop, key cross functional ECSM stakeholders identified the optimum ECSM option through gap analysis; Pugh Matrix completion proceeded by Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis on the selected ECSM.


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Phase 4 will deliver an ECSM Transition Road Map. Based on approval of this business case (proposed solution) and trial implementation of iECSM in 2017, the Road Map will detail the steps required to adapt the NCI Agency ECSM within the Agency and meet the current and projected External Customer demand without prejudice to the Agency’s primary customers and core business.



Business Improvement Initiative

Scope of Business Case This Business Case applies exclusively to the NCI Agency’s ECSO operating within the NCI Agency’s Demand Management (DM) Directorate. The ECSO is focused on managing External Customers C3 systems and ICT services requirements. Demand Management seeks approval for the ECSM Business Improvement Business Case to progress to Phase 4 of the ECSM Adaptation Study (Ref 5) in order to adapt the NCI Agency current CSM such that it can deliver a higher number External Customer projects in a low prioritisation and capacity constrained environment.

• In Scope: The scope of this Business Case is limited to adapting the NCI Agency’s CSM for External Customers only with focus on NATO First Solution (N1S) based small projects / service support packages.

• Out of Scope: This Business Case does not address adapting NCI Agency’s CSM for Common Funded Customers.

When Common Funded Programmes / Projects from host Nations are transferred from the territorial host Nation to the NCI Agency, the NCI Agency will follow the required Common Funded domain rules where applicable to the ECSM. In addition all large Programs / Projects (as acquisition of Radars, large CIS and similar items) will follow the rules of the Common Funded domain and will be adapted to the direction provided by funding authorities (Nations, Steering Committee, etc.), even when being part of the External Customer (EC) account. Efforts will be made to consolidate interlinked small Projects for all Customers and execute them as an internal program e.g. the mandate for the Connected Forces Readiness Program (2015) to integrate NATO Force Integration Unit (NFIU) Common Funded projects with several other projects for Multinational Core (MNC) North East, Multinational Division (MND) South East and support to enhanced NATO Response Force (eNRF) certification (including Very High Readiness Joint Task Force (VHRF)). In same line of development efforts in order to establish a Multi-Year POW (MYPOW), Multinational POW (MN POW) or as in the charter – Multinational Programs and Communication & Information Partnerships (C&IPs) will be used to optimize the support to ECSO. In addition Trust fund arrangements, Brokerage agreements and other instruments will be used over and above main model to address NATO N1S based small projects for the EC’s. Based on EC Satisfaction, ECSM best practices could be applied to the Internal Customer Account.

Current State Since the formation of NCI Agency in 2012, the demand forecast for Agency’s C3 systems and ICT services has consistently exceeded the Agency’s planned capacity to deliver, see Annex A. This capacity shortfall has been exacerbated further by impacts on efficient and effective product and service delivery incurred as the Agency goes through a major Agency Reform Change Management activities. Actions have been taken to streamline the program lifecycle process, improve the Customer Services Catalogue (CSC) and customer interaction, to reduce the capacity required to implement both Internal Customers (medium - large projects) and EC’s (small projects) C3 capability requirements.



In the period 2010-2016 efforts were made to introduce business innovations in order to improve support to the EC’s, below key highlights have been listed:

1. Multi-Year Programs of Work (MYPOW) signed with 7 Nations and 2 NATO Force Structure entities.

2. Multi-National Projects (MNP), including Multi-National Cyber Defence Capability Development (MN CD2) and Multi-National Alliance Defence Analysis and Planning for Transformation (MN ADAPT).

3. Communications and Information Partnerships (C&IP), with the NATO Software Tool C&IP being the first C&IP established in October 2016, to be followed by the Air Command and Control (AirC2) C&IP and the CIS Security Standards (CIS3) C&IP by end of 2016.

4. Support to Ukraine; delivery of C4 Feasibility (sponsored by NHQ/DI) and Regional Airspace Security Programme (RASP) Feasibility Study (sponsored by the Ukraine C4 Trust Fund).

5. Small “p” programs, including the Connected Forces Readiness program (CFRp) covering the Readiness Action Plan implementation and directly related projects.

6. Routine Delivery of NATO Software Tools, providing access to 19 NATO Software Tools free of charge.

7. Service Support Packages (SSP) for external customers SLA (based on SSA/SSTA); the Agency is managing 14 SSAs (3.4 M Euro) for External Customers each of which has one or more Service Support Packages (SSPs) to define specific annual services. The number of SSAs and SSPs is expected to grow in the coming years.

8. Customer Request Form (CRF) – Customer Satisfaction Form (CSF) tracking. 9. Demand Planning. 10. Customer Service Catalogue, including on-line CSC and Pilot Costed Services Catalogue for

External Customers. 11. Customer Engagement Plan with Customer Satisfaction Program and interim Customer

Relationship Management (CRM) toolset. 12. Joint Partnership Statements signed with LANDCOM and MARCOM, with new ones under

discussion with AIRCOM and US Army Europe (USAREUR). 13. Chief Information Officers’ Conference (CIOC).

Initiatives have also been taken by Demand Management and Service Strategy on the current NCI Agency’s CSM but despite them, the CSM still lacks an adequate Customer Requests process to address External Demand appropriately. Existing practices are not streamlined sufficiently to optimize all stakeholder interactions, roles and responsibilities, approval / coordination authority and overall monitoring authority. Operational level guidelines to drive operations in acceptable timelines, are missing (Ref 6). This is not only evidenced by this analysis but by parallel work: the report from the 7th Cycle NEDP project on ‘NATO 1st, Sharing Alliance Capabilities with Nations’ (Ref 7) which concluded: ‘…the absence of a business model specifically adapted to the new multi-national perspective hinders the delivery of the desired levels of readiness and responsiveness. The Organization is not yet equipped to face the challenge of delivering NATO First solutions in a flexible and timely manner to meet the demands of Nations seeking proven and cost-efficient answers to their interoperability needs. Additional work must therefore be done to define a governance framework covering areas such as Legal, Finance, Intellectual Property, Management and Security…’ (Ref 7)

In addition, in line with ASB Strategic Direction and Guidance (Ref 3) the Agency’s priority for execution has been focused on Internal Customer projects; this has the difference between external demand and the available Agency capacity to execute that demand, widening year on year. In accordance with the NCI Agency Demand Plan(Ref 8), Financial Plan (Ref 9) and Business Plan (Ref 10) this situation will



not improve and the capacity available to support the ECSO will continue to decrease as External Customer project requests increase i.e. the ‘integral’ capacity available to execute External Customer projects will reduce proportionately further.

Problem The graph below, Figure 2, illustrates projected External Customer Demand from the Demand Plan (Ref 8) and Financial Operating Revenue from the Financial Plan (Ref 9) which is a derivation of the available Capacity to execute, laid down in the Business Plan (Ref 10). Operating Revenue against External Demand is limited, this is because the Agency’s ability to execute work beyond the ‘Core’ Business (for Internal Customers projects) is limited given the capacity levels defined in the Business Plan. In short, on current plans, NCI Agency will not be able to execute the External Demand placed on the Agency with the forecasted capacity levels and ASB priority to focus on ‘Core’ Business (Internal Customer projects).

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Figure 2: Excess External Customer Demand

Not executing External Customer projects will impair Nations individual defence progress towards meeting their National obligations and in the case of Multi-National projects, some collective efforts in the Alliance to building a ‘deterrence and collective defence’ (Ref 1) posture.



From a strategic stand point, this situation is not acceptable and the Agency must increase its ECSM ability to deliver more effectively to meet External Customer demand. This could be by smart insourcing or via ‘outsourcing…non-core technical capabilities’ (Ref 3) but it must be improved. These inadequacies have had a direct impact on External Customer Satisfaction. The recent 2015 Customer Satisfaction Assessment (Ref 11) revealed that on average the overall satisfaction in both the areas of Project Management and Service Delivery decreased again in 2015:

• Project Management satisfaction falling by %19.2 to 56.7% and • Service Delivery satisfaction falling by 4.5% to 67.9%.

Therefore the ECSO will need to adapt its business model and processes to become more effective and efficient in delivering External Customer C3 systems and ICT services projects requirements.

Opportunity The ASB Strategic Direction and Guidance (Ref 3) articulates the objectives the NCI Agency must achieve in the near/medium term. These are to be reflected in a new NCI Agency Strategic Plan which will influence the next NCI Agency Business Plan (linked to Financial Plan) and Benefits and Savings Realisation Plan. This BC and the NCI Agency Strategic Plan, must address the issue of the NCI Agency meeting the potential competing Internal and External Customer Demand in line with ASB Strategic Direction and Guidance therefore ‘outsource’ as much Common Funded Work (Internal Customer projects) as possible while retaining the ‘essential skills and competencies’ required to meet NATO’s military needs e.g. in Crisis Response Operations (CRO’s). The skills and competencies required CRO’s are similar in nature to those required to meet the small, low cost short timescale projects typically found in External Customer projects. Improving the manner in which the Agency meets External Customer Demand also creates the opportunity to maintain essential skills and competencies whilst ‘outsourcing…non-core technical capabilities’. A pre-cursor document, NCI Agency Business Strategy (Ref 4), has been drafted prior to the NCI Strategic Plan to meet the Nations objectives and ASB Strategic Direction and Guidance (Ref 3). Although still subject to Nations approval, this document describes many of the internal interactions of the NCI Agency and aspects relevant to the ECSO, the Business Strategy, emphasises a ‘value-added integrator role’, ‘higher industrial participation’ and ‘flexible delivery ecosystem’:

‘…The role of the Agency shall evolve towards that of a Value-Added Integrator, focusing on those higher value activities and services where it has special knowledge and competence, or a unique role to play, or a unique contribution to make. In line with this trend, where an activity or service has no significant NATO-specific component, and delivery by the Agency has no added value, the Agency should in principle evolve towards not delivering it directly, except for reasons of convenience or to preserve the necessary responsiveness in times of crisis…’ (Ref 1) ‘…To the maximum extent possible that is consistent with short term and longer term risks, value, speed and flexibility, and with the preservation of sufficient capacity to be able to act in time of crisis with in-house resources, technical work shall be performed by industry throughout-tasking, outsourcing or insourcing as appropriate…’ (Ref 1)



‘…The Agency shall establish an ecosystem of commercial and non-commercial entities, who participate in the performance of and delivery of the Agency’s work and services on a regular basis, engaged through a number of long-term and flexible capacity-sourcing arrangements, to allow rapid up-scaling and down-scaling of the total ability of the Agency to deliver to the commands and to the nations…’ (Ref 1) According to the Business Strategy document (Ref 4) Item 6 of the ASB Strategic Direction and Guidance (Ref 3) will be addressed with Measures 1 and 2.2, with a focus on understanding customer / stakeholder expectations and providing single accountability to meet these expectations. To deliver value to External Customers, the ECSM must be efficient and utilise the benefits of ‘commercial best practice’ within elements of its CSM to deliver External Customer projects on schedule, within cost and to the required quality standards in order to realise savings whilst meeting simultaneous expectations:

• Retain an enduring, integral staff capacity, with the requisite experience and the skills, to deliver the Alliances short notice,

• ‘Outsource’ as much Internal Customer work as possible.

A way to achieve this balance and retain within the Agency a workforce that has the essential skills and capabilities to meet CRO could be through CSM that outsources ’non-core technical capabilities’ to meets External Customer Demand; adapting current NCI Agency CSM based on ‘commercial best practice’ with an emphasis on outsourcing. The main opportunity is to develop a ECSM not just to address the main problem and concern of Internal Customers, but to provide crisis response capacity for the NCI Customer Funded Agency and to maintain a critical pool of expertise for NATO, to contribute to interoperability between NATO Command Structure (NCS) & NATO Force Structure (NFS) and National forces (including partners), to foster innovation and involvement of industry and public Research and Development (R&D) / Communication and Information (C&I) organizations, to support effectively Summit decisions and the concept of “One NATO”.



Options and Recommended Solutions To adapt the NCI Agency CSM to a tailorable outsourcing model that serves small, medium and large contract value projects, ECSM Requirements were derived based on a current NCI Agency CSM Review and ASB Strategic Direction and Guidance (Ref 3) and attributed to eight focus areas:

1. Structure & Personnel 2. Order (CRF) Acceptance / Refusal 3. Responsibility / Accountability / Authority 4. Catalogue of Services 5. Referrals 6. Interoperability & Integration 7. Cost & Lead Time Controls 8. Strategic Intent

Grouping requirements into focus areas allowed for the assessment as to how applicable elements within Industry CSM’s address the ECSM requirements. ‘Outsourcing’ appears to be a very viable solution to meet External Customer demand. Outsourcing ‘non-core technical capabilities’ will be a means to develop ‘contract management, competition management, legal and procurement’ (Ref 3) skill sets that are required to mitigate risks and manage project integration when sub-contracting External Customer projects to Industry and other Agencies and Organisations. It requires to put more focus on N1S BOA (outsource to industry) and Not For Profit (NfP) Basic Ordering Agreement (BOA) (outsource to public R&D organizations) for outsourcing to NATO nations industry and public R&D/C&I organizations.

Goal and Principles of Options Development The main goal is to solve the above defined problem and exploit the current opportunity to support and enhance NATO’s operational successes. Main principles to be followed in solution development are:

1. Customer funding of the EC support activities 2. Affordability for external customers 3. Transparency to all stakeholders – especially NATO Nations and internal customers 4. Optimizing interoperability in secure environment 5. Integrity of the process and use LEAN principles to make it fast and easy for participants 6. Provide flexibility and agility for the support provided 7. Involve NATO nations’ industry and public R&D/C&I organizations to drive innovation 8. Legality of all aspects of EC support 9. Use of best business and public organizations’ practices

In order to overcome the delayed response to EC’s and the capacity concerns of the Internal Customers, ECSO best practices must enables the combination of all critical expertise (Business Relationship Manager (BRM), legal, Chief Technical Officer (CTO), Acquisition, N1S Subject Matter Expert (SME) and Project Manager (PM)), operate within a well-defined framework that is agreed by governance and management bodies to provide strategic agility, manage unity and flexibility of resources to implement an agile strategy for excellence in EC support, contributing to NATO success.



Options Considered Alternative CSM’s, including the current NCI Agency CSM, were considered using a Pugh Matrix. Annex B provides Pugh Matrix methodology i.e. identifying which CSM’s meet ECSM requirements.

Key ECSM requirements, attributed to focus areas, were developed in Phase 2 and reconfigured by NCOIC and expressed as questions that fed into the Phase 3 Model Selection Workshop Annex C. A detailed description of each Industry CSM can be found in the NCIOC Workshop Read Ahead Pack (Ref 12) and Current Model Review Report and Annex D provides a summary of typical characteristics for the four CSM.

Customer Support Models considered by cross functional ECSM stakeholders to adapt the current NCI Agency CSM and fulfil ECSM requirements were:

• Option 1 - Current NCI Agency ECSM Model (Do nothing) Uses a complex organizational structure and implements detailed policies and procedures to assure governance. This results in substantial limitations for divisions and the need to coordinate across many levels of approval in order to obtain authorizations and decisions.

o Advantages: organizational depth of specialized personnel available for the entire company.

o Disadvantages: risk averse with limited flexibility; follows rigid, time-consuming processes, limited resources across the entire company to handle peak demands.

This option is based on use of the NC3A Manual on the Implementation of Cooperation Service (Ref 16) and continuous improvement in the framework of NCIA Request to Proposal (R2P), prioritization and closure improvement initiatives.

• Option 2 - Industry Step Model (Service Division of a Global/Multi-National Company) Uses a complex organizational structure and implements detailed policies and procedures to assure governance.

o Advantages: organizational depth of specialized personnel and extensive financial resources available for the entire company.

o Disadvantages: typically risk averse with limited flexibility; follows rigid, time-consuming processes.

This option for NCIA means to establish ECSO under A5 single accountability with fully billable Account Managers (AMs) (NFS – 2, NATO Nations – 3, Multinational Project & Organization (MNP&O) and Partners – 2, AM support – 1) under new Terms of Reference (ToR), providing streamlined process for SStrat, Legal, Acquisition, project / service management, N1S SME support under well-defined framework for DDM and COO1 as A6 and above decision making (signing). It should be noted that time spent executing External Customer activities by A5 and A6 will recorded for accounting purposes.

1 For legal agreements to be signed by GM the process to be defined by Legal office in the framework of A5 single accountability for ECs.



• Option 3 - Industry Stretch Model (Service Company with separate group for handling

specialized customer requests) Simpler organizational hierarchy and structure. Still governed by several detailed policies and procedures.

o Advantages: more flexibility and tolerance of moderate risk; reduced coordination approval cycle time to obtain decisions and authorizations.

o Disadvantages: lower availability of personnel with specialized skills; limited resources across the entire company to handle peak demands.

This option for NCIA means in addition to the above model to have formally dedicated (contracted) support from SStrat, LO, Acquisition, Finance and pool of Project Managers (PM) and N1S SMEs from production. It means better defined team of 9 plus about 30 people, able to provide rapid reaction team type of support to External customers with managed reliance on the rest of the Agency capacity (with BP 17 at 36M Euro we will need for execution about 180-200 Full Time Equivalents (FTE)). Please note that this will support resource management across the Agency based on NATO’s NCS & NFS priorities.

• Option 4 - Industry Leap Model (Small Service-Oriented Company) Simple, “flattened” organizational structure. Still governed by a framework of general policies and simple procedures but allows great flexibility for individuals to seek efficient solutions to individual situations.

o Advantages: Very agile and tolerant of higher risk; leadership is very competent and multi-talented, able to take action in unusual business situations to obtain customer satisfaction.

o Disadvantages: typically in financial “feast or famine” conditions; not all specialized skills available within the company (outsourced).

This option will require the NCI Agency to position all staff that are covered by less than 1 FTE or not constant during the year / years to maintain only core staff and rely on contracted support for peak situations. It means a core team of about 100-120 people with focus on External customers, operating as separate business units, very much as POs in NSPA. Such Purchase Order (PO) could be in NCI Agency, could be in NATO Support & Procurement Agency (NSPA) or as a separate entity as Center for Maritime Research & Experimentation (CMRE).

Based on these CSM options, ECSM stakeholders voted for elements within each CSM that meet the ECSM requirements.



Recommended Solutions The Workshop was successful and the stakeholders discussed and voted on 17 attributes in eight major categories for each of the four models (900 specific votes in total). The table below details voting results:

Figure 3: Workshop Voting Results

Voting results show that ECSM stakeholders recognise that the current NCI Agency CSM does not have the required architecture to fulfil future External Customer Demand and have leaned towards a combination Stretch and Step Industry CSM’s.

CSM’s to consider to adapt the current NCI Agency CSM and fulfil ECSM requirements are: 1. Highest Scoring Solution - Industry Stretch CSM (Option 3)

The Industry Stretch CSM resulted in being the most appropriate CSM to meet External Customer demand. Key advantages of this CSM that drew ECSM Stakeholder votes were:

o Entire company may have several hundred or a few thousand employees, but the specialized customer group is relatively small.

o The specialized customer group has a few constraints resulting from the policies, procedures, and governance of the whole company, but has some latitude for flexibility and is willing to handle a moderate level of risk.

o The entire company’s emphasis is on the higher-volume major accounts for regular customers; the fewer specialized customer accounts are handled by the specialized customer group.

o The specialized customer group has limited personnel and budget resources, but it can draw on personnel resources from the larger company on an “as-needed” basis, with a slightly lower priority– some functions (such as legal representation) may be obtained from contracted personnel.

RED shading indicates a consistent negative pattern of votes for that attribute GREEN shading indicates a consistent positive pattern of votes for that attribute No shading indicates a wide range of votes and thus further analysis is required

ATTRIBUTE AS-IS STEP STRETCH LEAP -- - 0 + ++ -- - 0 + ++ -- - 0 + ++ -- - 0 + ++

1.0 Structure & Personnel1.1 How service is provided…1.2 How well the staff is trained…1.3 Personnel skill sets…2.0 ORDER ACCEPTANCE/REFUSAL2.1 Flexibility of conditions…2.2 Use of standardized 'teplate' procedures…2.3 Flexibility in accomodating customer cost…3.0 RESPONSIBILITY/ACCOUNTABILITY/AUTORITY3.1 RRA to satisfy the customer single acc.3.2 Stability of assigned RAA…3.3 Organizational governance for single acc….4.0 CATALOGUE OF SERVICES4.1 Service provider's range of services…4.2 Training availability for customers…5.0 REFERRALS [if order rejected]5.1 Use of list of qualified/certified referrals…6.0 INTEROPERABILITY&INTEGRATION6.1 How well the service provider resolves...7.0 COST&LEAD TIME CONTROLS7.1 How well the service provider meets cost…8.0 STRATEGIC INTENT8.1 Accepting order of strategic/political value…8.2 Re-adjust internal prioritization…8.3 Capability to upgrade/modernize…

48 78 53 45 14 5 41 49 84 59 3 23 57 118 37 52 55 48 43 39



o Specialized customer account representatives are typically designated from a pool of available personnel, and an account representative typically remains stable for a customer over time to provide single responsibility/ accountability/authority for customer satisfaction.

The key attributes in which the Industry Stretch CSM scored highest are; Structure & Personnel, Order Acceptance and Responsibility / Accountability /Authority.

2. Hybrid Solution – Industry Step & Stretch CSM (Option 2 & 3) There was a marginal difference (12points) between the Industry Step and Stretch Models. Key advantages that attracted ECSM Stakeholders votes to both Industry CSM’s were:

o the Service Division handles a smaller volume of products/services to a few special customers

o The entire company’s emphasis is on the higher-volume major accounts for regular customers; the fewer specialized customer accounts are handled by the specialized customer Group.

o Service Division has limited personnel and budget resources, but it can draw on personnel resources from the entire company Specialized customer account representatives are typically designated from a pool of available personnel or may be a team of people

Key attributes in which the Industry Step & Stretch CSM’s scored highest are; Structure & Personnel, Order Acceptance and Responsibility / Accountability /Authority as well as Catalogue of Services. In order to meet the ECSM requirements attributed to other remaining focus areas the following CSM elements should be considered as part of the Hybrid option:

o Interoperability & Integration – Industry Step CSM. o Cost & Lead Time Controls - Industry Stretch & Leap CSM. o Strategic Intent - All CSM’s.

This option is in line with the findings from NEDP Smarter Smart Defence, Multinational Cooperation Facilitated by the NCI Agecny and NSPA (Ref17) that focuses on facilitating Smart Defence initiatives ‘by offering a simple and clear methodology, and savings while safeguarding national interests’.

3. Low Scoring Solution – Industry Leap CSM (Option 4) External Customer Demand will keep growing, operational revenue will not increase and priority will continue to be given to Internal Customers requests however the NCI Agency must deliver External Customer Demand to support a ‘deterrence and collective defence’ (Ref 1) posture. Given the uncompromising environment in which the ECSO operates it must ‘outsource’ to fulfil External Customer Demand. However the current NCI Agency CSM is not structured such that is can ‘outsource’ efficiently and effectively therefore to implement Options 1 & 2 above a varying degree of change to the current NCI Agency CSM will be required. An alternative solution is to establish the ECSO as a bespoke trading entity i.e. public corporation, NATO owned and operated and financed from ECSO trading activity. This will be a means of



financing ECSO trading operations which, hitherto, have been carried out on NCI Agency Customer Request prioritisation. As a bespoke trading entity, the ECSO will be a self-accounting unit that has greater freedom than the Internal Customer Account and will lead its own financial and management activities i.e. it will be funded through a departmental estimate, employees will remain NATO employees, it will publish its own plans and Annual Report and accounts that will be consolidated into its parent organisation, NCI Agency. This is may seem an extreme option however a lower-risk one and has the potential to bring the functional improvements necessary without requiring complex risk transfer to the private sector (A public - private partnership involves a level of transfer of risk from the public to the private sector, which can take many forms depending upon the degree of private sector involvement).

Further to these options Annex E provides a SWOT analysis on the required ECSM and Annex F Key Findings from the ECSM Stakeholders that complement the options listed above.

Risk Factors & Mitigation Key Risks associated with adapting the NCI Agency CSM to meet External Customer Demand are detailed below:

• Risk & Mitigation 1 o Risk 1: Decision for change is delayed and customer satisfaction goes further down

with independent decisions of the various customers not to rely anymore on NCIA for supporting their NATO priorities.

o Mitigation 1: In addition to presenting the business case for internal approval, the Agency is organizing deeper discussion at the CIOC on 16.11 with involvement of Policy, Operational and Resource communities, Nations (incl. Partners) and NATO Force Structure, NATEX’s (national industry and R&D/C&I organizations view).

• Risk & Mitigation 2

o Risk 2: Selected decision is not able to provide required level of resourcing and agility for EC support, because of critical problems and focus of the leadership on common funded capability development and service provision.

o Mitigation 2: Select SRO and single accountability on A6/A5 level excluding conflict of interest/priority between internal and external customers support.

• Risk & Mitigation 3

o Risk 3: The External Customer projects will be predominantly outsourced based on the adapted ECSM whilst Internal Customers projects will be executed by NCI Agency staff; a point of inflection will occur where the External Customers will require more core capability and Internal Customers work will be non-core however there is a risk that neither account will have the correct competencies to deliver.

o Mitigation 3: An assessment in this inflection point is required in order to transfer outsourcing competencies to the internal account and core competencies to the External Account in order cross pollinate skill set. At this point there may be a requirement to merge both the ECSM and Internal CSM.



Financial and Legal implications The External Customer Support Office (ECSO) can be established three different ways:

• Inside the NCI Agency is framed by the Charter and may require ASB decision as organizational governance body;

• Inside the NATO Support and Procurement Agency (NSPA) as C4ISR Programme Office which will require NAC approval;

• As an independent customer funded organization (as done with the Centre for Maritime Research and Experimentation - CMRE) which will require NAC approval.

In all cases, the External Customer Support Office will be established under A5 single accountability based on new Terms of Reference providing streamlined processes for other directorates and entities under a well-defined framework for Director Demand Management and and Chief Operating Officer2 as part of the decision making process (signature authority).

In order to increase transparency and ensure integrity of the model processes, all activities related to External Customer support will be fully billable when executed by permanently assigned Account Managers as well as by dedicated (contracted) support staff from Service Strategy, Legal Office, Acquisition, Finance and pool of Project/Service Managers and Subject Matter Experts. Time spent for executing External Customer support-related activities by A5 and A6 will also be recorded for accounting purposes.

Furthermore, an External Customer Business Plan will support resource management across the NCI Agency based on NATO Command Structure and NATO Force Structure priorities.

The transition however is part of the Business Improvement Plan (part of the NCI Agency Business Strategy) and supported by Change Portfolio. Final costing of transition could be provided after decision on the option to be selected and development of the related road map.

Final Recommendation (Proposal) The need for change is widely acknowledge and made in a number of NCI Agency commissioned reviews (including the ongoing ECSM Adaption Study) as well as Strategic Direction and Guidance from the ASB (Ref 3).

Given the three solutions reviewed above, Demand Management proposes approval of:

• The Business Case for NCI Agency ‘External Customer Support Model’ Business Improvement Initiative;

• The development of an External Customer Support Model Road Map detailing the design and the steps required to implement the ‘Stretch’ model (option 3) within the NCI Agency. The ECSM Road Map to be presented to the EMB for approval in November 2017;

• The initiation, under the authority of the NCI Agency General Manager, of a trial implementation of an Interim External Customer Support Model (iCSM) starting in January 2017, based on the “Step” model (option 2) identified as a required step towards the “Stretch” model. This interim solution enable transition and will improve the current situation and

2 For legal agreements to be signed by the NCI Agency GM, the process will have to be defined by the Legal Office in the framework of A5 single accountability for External Customers.



provide valuable information for the developing the design of the detailed roadmap of the ‘Stretch’ model.



Annex A: External Customer Support Office Background

External Customer Base Since 2010 (considered as a baseline for agencies reform, according to approved business case), the number of External Customers requesting NCI Agency’s C3 interoperability capability and ICT services significantly increased, consequently the number of projects executed by the NCI Agency exponentially increased (Fig 4):

Figure 4: External Customer Account Growth

The delivery of these External Customer projects has been one of the most strategically successful business development decisions and implementation activities made by the Agency in line with C4ISR Comprehensive Approach (C3B, 11.11.2009). There are currently 265 active projects in 2016 and expected number of Customer Request Forms is 450 (there were 225 CRFs in 2015). These projects are for about 50 active customers of total number of 124 customers in this account. The NCI Agency Demand Plan (Ref 8) predicts growth will continue in line with NATO’s Long Term Adaptation Plan. This includes the support provided to the following elements within the External Customer base;

• NATO Force Structure (NFS); • NATO Nations; • Multinational Organisations (constituted of NATO and Partner Nations); • Partner Nations.

This growth is partially a result of the evolving security environment but also due to additional inter-related factors:

• Emergence of new threats, such as Cyber and Hybrid Warfare; • Decrease in national resources (people and money) leading to Nations inclining towards

partnerships to reduce costs; • A realisation within Nations, post-International Security Assistance Force (ISAF) Strategic

Assessment of Capabilities (ISAC), that there are economic and operational advantages of seeking ‘One NATO’ approaches;

• An increase of training & exercise events which are opened to NFS and require Nations to recognise the need for greater interoperability;

0

50

100

150

200

250

300

2010 2011 2012 2013 2014 2015 2016

Number of Customers Number of Projects



• The requirement to ensure greater tactical-level interoperability at the lower levels in order to provide an effective and credible forward presence through combined tactical level formations;

• Increased pressure on Nations by the Alliance as a whole, to meet their Article III obligations and provide for their own defence rather than overly relay upon the Alliance as a whole to defend nation territory. Which has led some nations to seek NCI Agency support to meet those obligations.

Significant expansion of the External Customer base has also increased the support provided by the NCI Agency to the Nations, Memorandum of Understanding (MOU) - Organisations and in the framework NFS. The graph below illustrates the increase of support to Nations (bilateral and multinational projects) in years 2011 and 2015 (Fig 2):

Figure 5: NCI Agency National Customer Support 2011 – 2015 (NFS not included)

Consequently given the projected increase in External Customer demand and limited ECSO operating revenue, support to External Customer’s needs to be re-thought, initially with a fresh eye not impacted by legacy and afterwards at the strategic level.

No. of Projects



Annex B: Pugh Matrix

Pugh Matrix Description Pugh Matrix (PM) is a specific Matrix Diagram that allows for the comparison of a number of design candidates, Current ECSM and Industry CSM’s, leading ultimately to which best meets a set of criteria. It also permits a degree of qualitative optimisation of the alternative concepts through the generation of hybrid candidates, elements from both Current CSM and Industry CSM’s.

The Pugh Matrix is easy to use and relies upon a series of pairwise comparisons between design candidates, Current CSM and Industry CSM’s, against a number of criteria or requirements, External CSM requirements. One of its key advantages over other decision-making tools such as the Decision Matrix is its ability to handle a large number of decision criteria, in this case External CSM requirements. The table below shows the uncompleted high level External CSM Pugh Matrix:

National CSM Requirements NCI

Agency CSM

Industry CSM Step

Industry CSM

Stretch

Industry CSM Leap

External CSM

Structure / Personnel Order Acceptance / Refusal Responsibility / Accountability / Authority

Referrals Catalogue of Services Interoperability & Integration Cost & Lead Time Controls Strategic Intent Total + Total - Total Score

Figure 6: High Level ECSO CSM Pugh Matrix

Pugh Matrix Completion Each Requirement will have a Sub-Pugh Matrix that includes External CSM requirements identified derived in Phase 2. The process for constructing a Pugh Matrix comprises of selecting one concept as the baseline, in this case it will be the NCI Agency CSM. This baseline is then scored as ‘0’ against all requirements. The other concepts, Industry CRM’s, will then be compared in a pairwise fashion against the baseline concept, NCI Agency CSM.

If an Industry CSM is:

• better than the baseline a “+” is entered in the appropriate cell, • worse than the baseline a “-” is entered in the appropriate cell, • the same than the baseline an “S” is entered in the appropriate cell.

It is also possible to add extra levels of discrimination by using:

• ++ = much better • -- = much worse



The overall evaluation is made by adding the “+” and “-“for each CSM concept.

Pugh Matrix Evaluation After scoring each concept, a Hybrid Concept or an Industry Model for the External CSM will be selected based on combining the highest scores for each requirement or model, this is a form of qualitative optimisation.



Annex C: Workshop Requirements

STRUCTURE & PERSONNEL: • How services are provided-- via a dedicated staff, or draw from a matrixed staff?

(Especially for Procurement/Contracting functions, ordering functions, Legal functions, etc.)

• How is the staff trained to provide such services to external customers? • What skills are required? Standardized or specialized skills? Are staff multi-skilled or

specialized? ORDER ACCEPTANCE/REFUSAL:

• Under what conditions does the service provider accept the external customer request or refer to a different service provider? Or just politely refuse the customer’s order request?

• Does the service provider have standardized “template” procedures for order acceptance/refusal? Or is this done on a case-by-case basis?

• Cost and Lead time (how long must customers wait) are key considerations for most external customers, i.e. are conditions set by the external customer. How rigid/flexible is the service provider to such customer demands?

RESPONSIBILITY/ACCOUNTABILITY/AUTHORITY (RAA):

• Who has the RAA to satisfy the external customer if their order is accepted? Is that RAA in a single person or in a team? Does the RAA change through the duration of the service process (e.g. from Acct Manager to Project Manager to Delivery Manager)?

• What is the service provider’s Governance regarding such RAA, especially for single accountability?

CATALOG OF SERVICES:

• What is the service provider’s range of services? (e.g. Rigid “Take-It-Or-Leave-It” vs. Pre-Defined Options vs Limited Tailoring vs. Customized)

• What information is available for customers? REFERRALS:

• If the service provider cannot (or will not) meet an external customer’s request, does the service provider maintains a list of Qualified or Certified Referrals to other service providers?

INTEROPERABILITY & INTEGRATION:

• How does the service provider ensure that the delivered product/service solution will be interoperable with others in the customer’s bigger picture? If the external customer experiences interoperability or integration issues, will (or how will) the service provider work with the external customer to resolve such issues?

COST & LEAD TIME CONTROLS:

• How does the service provider meet external customer requirements for cost control and on-time delivery schedule, assuming that the service provider has accepted an order with that external customer?



STRATEGIC INTENT:

• Will the service provider consider unusual requests from external customers that provide a strategic benefit (e.g. political influence) to the service provider?

• Will (or how will) the service provider adjust their internal prioritization to achieve a strategic benefit?

• Does (or how does) the service provider upgrade/modernize their standard products/services to be more efficient and effective? (I.e. provide Cheaper-Better-Faster service)?



Annex D: CSM’s Attributes Attribute Category

"As-Is" Model

STEP Model

STRETCH Model

LEAP Model

Structure & Personnel Complex Hierarchical Structure, limited formal reporting

Complex Layered Structure, formal reporting

Simple Layered Structure, reduced formal reporting

Simple, "Flattened" Structure, limited formal reporting

Order Acceptance Or Refusal

Stakeholder dependent, no risk management

Rigid criteria for orders, risk adverse Some flexibility in orders, can tolerate some risk

Highly flexible, willing to assume risk

RAA Single team and single person responsibility, not well defined/assigned

Single Team accountability Single person accountability Single person accountability

Catalog Of Services Limited portfolio of typical products & services, allows extensive tailoring

Pre-defined portfolio of products and services

Portfolio of template products & services with some tailoring

Portfolio of typical products & services, allows extensive tailoring

Referrals (if order rejected)

No referrals to approved vendors. Referral to list of formally qualified & approved vendors

Referral to a few recommended vendors

Unlikely to give referrals, but if so then to a few alternate vendors

Interoperability & Integration

Formal requirements with formal verification and testing.

Formal requirements with formal verification and testing

High-level requirements with some structured verification and testing

Case-by-case tailoring to achieve interoperability and integration

Cost & Lead Time Controls

Formal cost & schedule controls, but prone to schedule slips due to re-prioritization

Formal cost & schedule controls, but prone to schedule slips due to re-prioritization

General cost & schedule controls, "best effort" toward maintaining schedule, some flexibility for customer satisfaction

More "cost-plus" than fixed-price cost controls, "best effort" toward maintaining schedule: emphasis on customer satisfaction

Strategic Intent Formal priorities based on negotiated agreements & political needs, willing to take extreme measures to satisfy current customers

Formal priorities based on negotiated agreements & political needs, able to achieve some political influence

Some emphasis on retaining or expanding market share (public image is very important)

Typically willing to take extreme measures to satisfy current customers

Figure 7: CSM’s Attributes



Annex E: SWOT Analysis Strengths

• NATO FIRST concept is a strong binding force. • Knowledge and experience available inside NCI Agency. • External Customers Support Model (ECSM) services based on

new type of contractual vehicle e.g. N1S

Weaknesses

• The Window of Opportunity to drive ECSM into realization is limited, as the customer will walk away, if his requests cannot be met.

• Lacking adequate means to leverage connecting existing body of knowledge and skills.

• The current services catalogue is presently not adequate to support ECSM.

Opportunities

• Leverage BOA-like services. • Use Window of Opportunity to secure guidance from ASB. • Change NCIA to become faster and leaner. • Increasing response to requests from external customers. • Include nations in processes for stimulating and streamlining. • If successful, the new support model (or elements of it) may

be considered for other customers’ segments. • Deliver faster on standard services. • Development of new frameworks for

cooperation/partnerships with industries. • Embrace change and improve processes to meet future

demands.

Threats

• Cannot meet the urgent requests by nations, if NCIA does not adapt.

• Protection of “organizational turf”. • NCIA may not be allowed to re-shape work-force. • Additional delivery points may not be able to be

accommodated by the Agency.

Figure 8: CSM’s SWOT Analysis



Annex F: Workshop Stakeholder Key Findings

– 1. Structure & Personnel • Essential skills and competencies are existing within the Agency • Training to qualify multi-skilled staff is essential • The Rapid Response Team should be established with “best staff” taken from

the matrix permanently • There may be a need for multiple Rapid Response Teams

– 2. Order acceptance/refusal

• The Agency shall accept certain requests (e.g. for operational needs) • It is not about business but about being operationally agile and flexible to

accommodate customer budget and lead time • We cannot turn NATO nations away

– 4. Catalogue of services

• Clearly-defined catalogue of services available to external customers with defined and constrained customization is critical

• NCI Agency products/services range should be well defined but limited • Specifically for ECSO we need N1S Catalogue and N1S Basic Ordering

Agreement (BOA) / Not for Profit BOA for outsourcing of work when required

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