Australia has entered a pivotal moment in the evolution of Defence capability delivery and industrial performance. With the 2026 National Defence Strategy, the establishment of the Defence Delivery Agency, the Productivity Commission’s national productivity agenda and major Defence digital, workforce and capability delivery reforms now in motion, there is a timely opportunity to strengthen how capability is planned, measured and delivered across the sector.

TBH’s latest white paper, A New Era: Building a Whole-of-Defence Sector Productivity System, makes the case for Australia to formally establish a whole-of-sector Defence productivity agenda – one jointly owned by Government, Defence and industry. It argues that many of the building blocks for reform are already present, but that they need to be brought together through a coherent, jointly governed system.

This proposed framework would integrate existing Defence reforms with national productivity policy and extend them across the Defence-industry boundary. With that shared architecture in place, reform efforts can be more effectively coordinated, measured and sustained across the broader industrial base.

Central to the white paper are three foundational pillars required to improve productivity across the Australian defence sector:

• Project Controls as the Technical Foundation – positioning project controls, including earned value management, schedule management, risk analysis and integrated performance measurement as the essential data architecture for productivity improvement.
• Collaborative and Relational Contracting – advancing collaborative contracting models that align Defence and industry incentives toward shared delivery performance rather than adversarial risk transfer.
• Systematic Joint Learning – establishing a shared Defence-industry lessons learned system, informed by just culture principles, to prevent repeated delivery failures and improve institutional learning across programs.

The paper also considers the industrial productivity challenge across Tier 1, Tier 2 and SME suppliers, arguing that Defence industry must be treated as a co-owner of productivity reform rather than simply a recipient of government-directed change.

It identifies the Defence Delivery Agency transition and the anticipated 2026 Defence Industry Development Strategy update as practical policy windows to embed a coordinated productivity agenda and strengthen shared accountability across the Defence enterprise.

This white paper concludes that Australia now has the strongest conditions in three decades to establish a durable whole-of-sector defence productivity system, but that success depends on naming the agenda, aligning governance and measurement frameworks and building shared accountability across the full defence enterprise.

Click below to download the white paper.