Defence Materiel Organisation
The Defence Materiel Organisation ('DMO') is the Australian Government
Government of Australia
The Commonwealth of Australia is a federal constitutional monarchy under a parliamentary democracy. The Commonwealth of Australia was formed in 1901 as a result of an agreement among six self-governing British colonies, which became the six states...

 agency responsible for the acquisition, through-life support and disposal of equipment for the Australian Defence Force
Australian Defence Force
The Australian Defence Force is the military organisation responsible for the defence of Australia. It consists of the Royal Australian Navy , Australian Army, Royal Australian Air Force and a number of 'tri-service' units...

. The DMO is part of the Australian Department of Defence
Department of Defence (Australia)
The Australian Department of Defence is a Federal Government Department. It forms part of the Australian Defence Organisation along with the Australian Defence Force . The Defence mission is to defend Australia and its national interests...

, and manages the acquisition and support of a diverse range of materiel
Materiel is a term used in English to refer to the equipment and supplies in military and commercial supply chain management....

 (equipment), including aircraft, ships, vehicles, electronic systems, uniforms and rations. The DMO has a budget of A$11.8 billion (2009), with over $6.3 billion spent on purchasing new equipment and $5.5 billion on sustainment and through-life support (maintenance, upgrades, fuels, explosive ordnance and spares). In 2009, the DMO managed some 210 major projects (each with a budget over $20m) and more than 150 minor projects. It employs more than 7,500 military, civilian and contracted staff in more than 70 locations around Australia and internationally.


DMO was formed in 2000 when the then Defence Acquisition Organisation merged with Support Command Australia, bringing together the Department of Defence's capital acquisition and logistics organisations into a single entity. The DMO was given responsibility for purchasing, through-life support and disposal of military equipment assets, other than facilities and administrative assets. In July 2005, DMO became a Prescribed Agency under Australian Financial Management and Accountability legislation, meaning that although it remains a part of the Department of Defence
Department of Defence (Australia)
The Australian Department of Defence is a Federal Government Department. It forms part of the Australian Defence Organisation along with the Australian Defence Force . The Defence mission is to defend Australia and its national interests...

, it is separately accountable to the Minister of Defence for its budget and performance.

DMO's stated vision is to become the leading program management and engineering services organisation in Australia. Its goal is to deliver projects and sustainment on time, on budget and to the required capability, safety and quality.

Mortimer review

In May 2008, the Australian Government commissioned a review of the Defence procurement, which included in its terms of reference a report on the progress of implementing reforms from the last such review - the 2003 Kinnaird Review.

The review was conducted by David Mortimer, who presented his findings in September 2008. Mortimer identified five principal areas of concern. These were inadequate project management resources in the Capability Development Group, the inefficiency of the process leading to government approvals for new projects, personnel and skill shortages in the DMO, delays due to industry capacity and capability and difficulties in the introduction of equipment into full service.

In all, Mortimer made 46 recommendations, with 42 accepted in full by the Government and three accepted in part. One recommendation was not accepted - that the DMO should be separated from the Department of Defence
Department of Defence (Australia)
The Australian Department of Defence is a Federal Government Department. It forms part of the Australian Defence Organisation along with the Australian Defence Force . The Defence mission is to defend Australia and its national interests...

 and become an executive agency. This recommendation that was also made in the 2003 Kinnaird Review but was not implemented by the Howard government
Howard Government
The Howard Government refers to the federal Executive Government of Australia led by Prime Minister John Howard. It was made up of members of the Liberal–National Coalition, which won a majority of seats in the Australian House of Representatives at four successive elections. The Howard Government...

. As an executive agency the DMO would receive its own acquisition funding stream as a government appropriation and would be headed by a chief executive with "significant private sector and commercial experience". Mortimer also recommended that a General Manager Commercial position be created to implement a business-like focus throughout the organisation.

Post-Mortimer reforms

Ministerial statements in 2010 and 2011 suggested that the Government believed new procurement reforms were needed. On 26 November 2010 the Minister for Defence, Stephen Smith, in adding project AIR 5418 Joint Air to Surface Stand-off Missile (JASSM) to the 'Projects of Concern' list, stated that the listing was because of "our poor management, our failure to keep Government properly and fully informed about the project and it's difficulties." Minister Smith also said that he had asked Defence to review the effectiveness of its management of major projects. On 6 May 2011 Minister Smith announced further Defence procurement reforms aimed at improving project management, minimising risk at project start and identifying problems early and on 29 June 2011 Minister Smith announced reforms to the management of 'Projects of Concern' including the development of formal remediation plans for designated projects.


Dr Stephen Gumley was the DMO's Chief Executive Officer from February 2004 until his resignation was announced by the Minister for Defence, Stephen Smith on 7 July 2011. A replacement was not immediately announced. Gumley had headed an executive team of around 20 senior managers. According to the DMO, the executive team had considerable private and public sector experience, as well as extensive military domain knowledge.

The executive team consists of the CEO, four general managers, ten division heads, three program managers, a CFO, and a Special Counsel. In addition, several major capital acquisition programs are led by senior military or civilian managers. In January 2009 the DSTO
Defence Science and Technology Organisation
The Defence Science and Technology Organisation is a branch of the Australian Department of Defence which researches and develops technologies for use in the Australian defence industry....

 (Deputy Chief Defence Scientist level) position of Chief Systems Integration Officer was added to the management team.

In March 2009, the Corporate General Manager of the DMO, Jane Wolfe, was dismissed for unsatisfactory performance. The Canberra Times
The Canberra Times
The Canberra Times newspaper was founded in 1926 in Canberra, Australia by Arthur Shakespeare.It was the second paper to be printed in the city, the first being The Federal Capital Pioneer. The paper was sold to the Fairfax group in the 1960s by Arthur Shakespeare on the condition that it continue...

reported that its 'senior public service sources' believe she is the highest-ranking Australian Commonwealth public servant to ever have been dismissed for underperformance. Wolfe was reinstated in April 2010 following a legal challenge against her dismissal in the Federal Court of Australia
Federal Court of Australia
The Federal Court of Australia is an Australian superior court of record which has jurisdiction to deal with most civil disputes governed by federal law , along with some summary criminal matters. Cases are heard at first instance by single Judges...

. The case is said to have "significant implications" for the Senior Executive Service of the Australian Public Service
Australian Public Service
The Australian Public Service is the Australian federal civil service, the group of people employed by federal departments, agencies and courts under the Government of Australia, to administer the working of the public administration of the Commonwealth of Australia...

, where legal challenges to performance decisions have been rare.

External links

Further reading

  • Ergas, Henry. 'Some Economic Aspects of the Weapons Systems Acquisition Process' (2003); available from CRA International
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