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Sherlock – Solving Defence Procurement Headaches and Supply Chain Issues By Julian Nettlefold

 

 

 

 

Alex de Bruyn, 33, South African, an accountant by trade, started DoshEx three years ago to develop advanced blockchain software systems to manage complex construction contracts in particular. The company has its first contract to manage the refurbishment of a food mill in Cape Town through our client Redec, an industrial painter. Alex’s partner in DoshEx is Richard Creighton who spent 23 years with Honeywell in Africa, 10 years at the helm.

 

 

Sherlock is an enterprise-ready smart contract network, bringing together IoT, Distributed Document Management and Blockchain to improve traditional contracts, which in turn will make the business processes more efficient. Sherlock creates a trusted trackable record as it moves through a supply chain and combining that with the ability of sensory data throughout, ensures an asset adheres to all conditions, set out in the supply of contracts for the asset.

It was certainly an opportune moment for BATTLESPACE to meet up with Alex to discuss his advanced and unique software, Sherlock, the very week when the House of Commons Public Accounts Committee issued its damning report on the consistent and growing failures in defence procurement.

“How did you start DoshEx?” The Editor asked

“Richard and I recognised that Blockchain technology and IoT were key disruptors to the current processes of project management. We started from a clean sheet in an area we knew well, managing payments, and developed this, using IoT and Blockchain technologies to provide a system capable of managing complex construction projects. In these projects, there are a myriad of sub-contractors whose quotes and payments need to be managed to ensure the smooth delivery of the project on time and to budget. We saw that transparency, efficient management of sub-contractors and the supply chain along with trust of those sub-contracts, were key to the development of Sherlock. In 2017 we were engaged by IBM in South Africa and we now have an Embedded Solutions Agreement with them and more recently became a global finalist in their Beacon Blockchain Trailblazer award at the Think2020 conference. The company has grown to be six strong, mainly engineers and we now have had a presence in the UK since 2019.” Alex de Bruyn said.

Public Accounts Committee Report

On May 13th a report published by the UK Public Accounts Committee says the Ministry of Defence (MoD) has left the taxpayer to shoulder huge cost increases due to the MoD’s poor contract design and management. The MoD said it “immensely regretted” the huge waste of taxpayers’ money, which was caused by poor management of three nuclear infrastructure projects, resulting in a combined cost increase of £1.35bn and with delays of between 1.7 and 6.3 years.

The department also admits that costs could keep rising, as its poor contract design has left the taxpayer to assume financial risk, while doing little to incentivise contractors to improve their performance. The report finds, as the department itself admitted, that the risks associated with nuclear programmes, civil or military, are too large for private companies, and must be managed by the department, regardless of whether it owns the relevant sites or not.

The MoD was unable to explain why it has repeated past mistakes – many of which have been repeatedly commented on by the National Audit Office and Public Accounts Committee for more than 30 years – and has failed to learn lessons from comparable projects in the civil nuclear sector and in the United States. The MoD accepted that it must not operate in the same way in the future.

US communications giant Viasat, gave evidence to to UK House of Commons Defence Select Committee Inquiry on UK Defence Industrial Policy: Procurement and Prosperity.

Viasat’s evidence was published by the Committee, (https://committees.parliament.uk/writtenevidence/2048/default/)and calls for a modernized procurement and delivery framework to match the defence and security needs of the UK Government. In its submission, Viasat asks the UK Ministry of Defence (MoD) and Government to create an agile, hybrid approach to acquire defence-based systems and services to meet technology acceleration and rapidly changing adversarial threats.

The Viasat approach recommends:

• Building trusted partnerships between MoD, Government and the private sector to drive information advantage;

• Requiring defence procurement procedures to meet stringent competition rules;

• Executing an outcomes-based assessment programme;

• Investing in progressive technology to meet current and future front-line mission requirements;

• Moving integration ownership to industry consortia;

• Sharing risk and design obligations—thereby alleviating the burden on existing programme processes which are not shaped to continuously evolve;

• Allowing industry to provide ‘test before you buy’ solutions to reduce MoD costs and risk; and

• Driving incremental innovation at speeds that align with needed capabilities.

Steve Beeching, managing director, Viasat UK, said, “The UK Defence Industrial Policy: Procurement and Prosperity inquiry will shine a bright light on the current procurement procedures that have yielded programme delays, overspending and higher risks to the MoD. We feel very strongly that a more agile, hybrid approach is needed to procure the appropriate systems and services required to keep pace with technology advancement. By modernizing the procurement process, MoD can work toward better processes to keep the nation safer, its citizens protected and its service men and woman empowered on the frontline of battle.”

“Having seen this damning report how can Sherlock help solve these mounting problems?”

“Managing a complex defence project has the same pitfalls as the management of a complex construction project. By utilising Blockchain and distributed technology in Sherlock, this has given us the ability to increase transparency and reduce the reliance on trust in a network, while IoT has given us the ability to create a trusted device to gather accurate data on real-world events.”

“Given the sensitivity and security issues involved in defence contracting, can you ensure full security from sub-contractor to the Prime Contractor managing the contract?”

“Security is key to the success of Sherlock, each user has their own Privacy Key with an encrypted Authority Key, which is visible only to the user of that key.”

“What do you see as the key differentiator between Sherlock and other blockchain systems?”

“One of our key enablers is the management of smart contracts through Sherlock.”

“What are smart contracts?”

“A smart contract is a computer protocol intended to digitally facilitate, verify, or enforce the negotiation or performance of a contract. Smart contracts allow the performance of credible transactions without third party involvement. These transactions are trackable and irreversible.

The aim of smart contracts is to provide security that is superior to traditional contract law and to reduce other transaction costs associated with contracting. Smart contracts take on a vast array of forms with a magnitude of different systems that need integrating. Our team of experienced blockchain and integration engineers are equipped to deploy specific fit-for-purpose smart contracts and integrate them with most currently running systems and improve current processes with as little disruption as possible.”

Key Sherlock features

Key Sherlock features include Digital Twinswhichare intelligent sensors and smart controllers embedded in the process throughout the project lifecycle and smart devices which are capable of peer-to-peercontrol as needed and have logic capability in the sensors. Patterns of control can be executed in milliseconds from the device. IoT devices monitor topics (events) and publish changes to the blockchain, executing an applicable smart contract.

Sherlock converts critical elements (relevant to all stakeholders), from traditional Standard contracts to self-executing smart contracts, which are triggered by verifiable and auditable inbound oracles received from an encrypted IoT device.

Hyperledger Fabric, running on the IBM Blockchain Platformis a platform for distributed ledger

solutions underpinned by a modular architecture delivering high degrees of confidentiality,

resilience, flexibility, and scalability.

All events are appended to the blockchain within its relevant channel in order to

increase transparencyand accountability while respecting the privacyof each participant’s

commercial model.

“Can your system connect seamlessly across networks using open architecture software?”

“Again, that is another unique feature of Sherlock. We useIPFSwhich is a protocol and network designed to create a content-addressable, peer-to-peer method of storingand sharing hypermedia in a distributed file system.”

IPFS ensures that all stakeholders involved in a contract are working from any latest

signed-off documentationby embedding an immutable IPFS link, of that documentation, into

the blockchain.

“Of course the key to any new software is affordability, is Sherlock competitive with its competitors?”

“We have developed a tiered payment system which allows access to Sherlock from small SMEs through Tier 1 suppliers to the Prime Contractor.”

These start at a Tier I Member for $360 per month, through a Tier 2 Member at $2160.00 per month to Tier 3 which is $10,000 per month. All have a full support package 24/7 from DoshEx.

“It certainly looks like you have hit the sweet spot, what opportunities do you currently have?”

“We are looking at ten major project opportunities across the world with three to four in the UK. Once Sherlock becomes accepted in other defence and aerospace community, we see an exponential growth in interest and sales in these sectors.”

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