Acquisition Reform and the French Armaments e-Portal Project - International Business Environment

Program Manager, Sept-Oct, 2001 by Bertrand Jourlin

If you cast a glance at the e-environment as it was two or three years ago, you can easily assess how quickly and widely the Internet has succeeded in becoming a truly essential tool of international business. Yet, the explosion of e-business is not brand new. In 1994, the U.S. Federal Acquisition Streamlining Act mandated establishment of the Federal Acquisition Computer Network architecture to enable U.S. Federal Agencies and vendors to do business electronically in a standardized fashion. Rapid evolution in the technology provided alternative electronic purchasing methods, and in November 1997, the U.S. Department of Defense was allowed to pursue other means of implementing Electronic Commerce (EC). This led, a couple of months later, to the creation of the Joint Electronic Commerce Program Office, now renamed the Defense Electronic Business Program Office.

In France, during approximately the same period, la Delegation Generale pour I'Armement (DGA), or the French Procurement Agency, was on the verge of going through a major reform of its organization and revamping of its business practices. The conclusions of this reform endorsed the compelling outcomes of EC on our current working methods, notwithstanding the fact that the revolution and proliferation of Web technology was definitely going on -- with or without us.

Therefore, the DGA decided to adopt some of the commercial best practices embraced by the United States and started to experiment with some of the new tools associated with EC. In March 2000, the Chief of DGA set up a task force for this experimentation, located in DGA Headquarters, Paris. The objective of the task force was to establish an Armaments e-Portal with four major goals:

* Simplify the relations between DGA and its suppliers.

* Improve DGA procurement practices (with a focus on reducing cycle time).

* Streamline logistics.

* Promote assets of DGA suppliers.

A Top-Down Strategy

The DGA initiative, available on the Web at www.ixarm.com, is certainly relevant to challenges faced by industry today In the beginning of 2000, every industry executive was trying to address the same tough issues:

* Do I need to establish an e-marketplace in my business area?

* Do I need to develop a joint-order front office in collaboration with some of my competitors, and if yes, which ones?

* Is my back office able to work effectively with the emerging marketplaces?

And naturally all these issues had to be addressed and solved at Internet speed.

Of course, DGA is a governmental agency and, as such, must comply with government contracting regulations (Code des Marches Publics); at the same time, DGA is also striving to capture the best practices of the commercial environment. Thanks to a French Reform Initiative, launched in 1997, DGA is now managed as a kind of private company. As such, all the issues just discussed are still relevant for us, even if the challenges are sometimes faced from a different perspective.

We realize the tremendous ramifications of such a project - impacting partners far beyond our own environment. Changing business processes between DGA and its suppliers may even result in a requirement for these companies to revamp their own internal working practices. On the other hand, an unchanged DGA would represent an impediment to the modernization and restructuring of its contractors. DGA's Defense industrial partners will therefore benefit from the modernization of DGA, we believe, by using cutting-edge technology, thereby becoming more competitive on the world market. Additionally, by adopting commercial best practices, the traditional Defense suppliers reduce their operating costs, which are costs driven by their main customer -- DGA.

The Defense community as a whole is evolving with DGA, and we must consider all the members of this community -- such as suppliers, providers, and customers -- as partners in this major shift in our business practices.

Web standardization is an enabler of the partnership between DGA and its suppliers. Of course, some concerns remain for security and high-speed data exchanges; however, fielded with standard Web technologies such as http, html, and Xml, DGAs Web portal -www.ixarm.com -- offers easy and user-friendly access to every member of the community We do not pretend that all the relevant issues are now solved. In fact, we are still wrestling with some of them, and working to achieve complete interface with our partners. Admittedly we face a tough task, but by relying on commercial standards, we at least facilitate the handling of services provided.

Ixarm -- the Armaments Portal

To reach the goals and objectives assigned to the portal project, ixarm has been structured around three main areas (Figure 1), two of which are already accessible at www.ixam.com.

Marketing Area

This area provides an overview of products and describes the technical expertise of DGA suppliers, including Prime contractors, Sub-contractors, and Small Business companies. Soon, everyone will be able to view the operational capabilities of various weapon or procurement systems presented via this virtual show.