European defence industry consolidation and domestic procurement bias

How have European cross-border defence industrial mergers and acquisitions affected domestic procurement bias among the major EU powers? This article departs from the findings of Andrew Moravcsik more than two decades ago suggesting that major West European states had no ingrained preferences for defence industrial autarchy. When cross-national armament projects were derailed, this could be attributed to political efforts of national defence industrial champions favouring purely domestic projects. As former national champions join pan-European defence groups, their preferences are likely modified. Does this shift procurement towards non-European “off-the-shelf” solutions which, according to Moravcsik, are favoured by defence departments? Or does it give impetus to a stronger preference for European as opposed to domestic systems? In this article, procurement patterns in the aftermath of cross-border defence industry consolidation will be analysed. Procurement bias is assessed in two industry segments characterised by pervasive consolidation.     

From the people's army to the Jewish people's army: the IDF's force structure between professionalization and militarization

The article discusses processes of “religionization” within the institutional identity and ethos of the Israel Defense Forces (IDF) and the connection of these processes with the significant structural changes the IDF has undergone in recent decades. The main argument presented is that since the late 1980s, the IDF has been in a culture conflict, torn between soldiers and civilians who advocate turning the IDF into a professional army “military professionalization,” and others who wish to preserve, and even strengthen, the “people's army” model. The present article shows that the meaning of the term “people” in this phrase has shifted to refer strictly to the Jewish people, and that a national-ethnic perception strongly influenced by religious-national ideology has been adopted.     

‘I have seen the future and it works’: The US defence industry transformation – lessons for the UK defence industrial base

The US has embarked upon a major transformation of its approach to defence industrial base planning. Although bureaucratic and industrial inertia, as well as budgetary constraints, may delay transformation, its effects will lead to radical changes in the US defence industrial base with new entrants and new combinations of players. The UK, with more modest defence ambitions, capabilities and budget, will seek to keep in touch with the US. However, a commercially‐led drive to embed UK industry even more deeply in the US defence market could be the last step in creating a largely US–UK North Atlantic relationship, with much of Europe very much a subsidiary business concern. This contains a risk that the UK will become increasingly dependent on the US for design and integration of major systems and national defence industrial capability focused on a limited number of niche technologies.     

Estimated UK employment dependent on ministry of defence expenditure and defence exports

The Ministry of Defence (MOD) has published estimates of the number of average full‐time UK industry employees dependent on MOD expenditure and defence exports for a number of years. This paper provides the outcome of a recent review of the process used. The method of deriving MOD and defence export final demand vectors, and calculating from these estimates of direct employment (i.e. that in supplying companies) and indirect employment (i.e. that incurred through the supply chain) are described. Difficulties with the data are explored. Alternative approaches, methods used in other countries and challenges posed by changing MOD administrative systems are briefly discussed.     

Change as a cost driver in defence procurement

This paper discusses change transactions that occur in connection with the procurement of defence systems. The bases for the reasoning are the ideas of Miller and Vollman (1985 Miller JG Vollman TE (1985) The hidden factory – cutting the explosive growth of overhead costs requires mastery of more than just what happens on the shop floor Harvard Business Review Sept–Oct 142 150  [Google Scholar]) and Eppinger (2001 Eppinger DE (2001) Innovation at the speed of information Harvard Business Review January 149 158  [Google Scholar]). These researchers argue that unplanned flows of information lead to change transactions, causing significant overhead costs. According to this paper, change transactions in defence procurement could be caused by (a) the changes in technology taking place during the long lifetime of a defence system and (b) the structure and contents of the agreements between the defence agent (the procurer) and the defence industry (the supplier).     

An alliance between Cyprus and Greece: assessing its partners’ relative security contribution

The issue that this paper tackles is the assessment of the relative security benefits that Cyprus and Greece derive in the context of their cooperation on defence matters. This form of cooperation, known as the ‘Integrated Defence Space Doctrine’, aims at defending their interests in the Aegean Sea and the broader East Mediterranean theatre. The paper relies heavily on earlier research on this topic, which deals with the Greek–Cypriot alliance facing an arms race against Turkey, and uses a coefficient especially designed to assess the optimal levels of security and the associated defence expenditure of the two allies. A comparison of the relative security coefficient values for the two allies suggests that the security benefit that Greece derives thanks to its alliance with Cyprus exceeds the corresponding Cypriot benefit by far. Given the importance assigned to human resources by this index, in conjunction with the demographic problems of Greece, this conclusion justifies the recent Greek defence policy revision, emphasizing quality, capital equipment and flexibility of forces. This revision aims at satisfying the security requirements of the alliance and the increasing demands of an arms race against Turkey.     

The UK defence electronics industry: adjusting to change

The electronics industry provides components and capabilities that are critical to modern defence requirements. It is anticipated that the effectiveness of both weapons systems and the command and control network that supports military operations will become increasingly dependent upon the electronics sub‐systems they employ in the future. With the ascendancy of ‘network centric warfare’, it seems certain that defence electronics will continue to grow in importance in the future, enabling far‐reaching advances in military capability and efficiency. Yet little is known about the structure, conduct, performance and competitiveness of the UK defence electronics sector as it prepares to meet the challenges ahead. This paper reports the findings of a study commissioned in 2002 by Intellect, the UK defence electronics trade association, and supported by the Department of Trade and Industry. The UK defence electronics industry is found to be a high technology, R&D‐intensive and decreasing cost industry, which is competitive in world defence markets. The UK industry faces major competitive threats in the future from established US and European firms and from potential new entrants from China, India, Israel, Singapore, South Korea and Turkey. The future competitiveness of the UK defence electronics industry will depend on maintaining both technical advantage and open access to the large US market.     

Optimal defence structure for a small country

Small countries may not be able to afford all force elements (army, navy, air-force) operated by larger countries and certainly cannot afford all sub-elements (aircraft carriers, submarines, etc). This paper provides a framework for a small country to analyse its force structure, examining the influence of objectives, international co-operation, funding and technological constraints, and uncertainty. We analyse when a small country may choose to retain a balanced structure (with each force element) and when it may choose to drop one or more elements. The issues are illustrated with the decision by the New Zealand government over whether to retain a strike aircraft capacity.