Researchers at the University of South Australia (UniSA) have proposed a new planning formula to optimise the lifecycle value of Australia’s naval fleet. (From The Australian Defence Magazine.)
“Due to diminishing budgets, rapid advances in technology, and emerging threats, it is more important than ever to build a naval framework that is more flexible and cost effective,” lead researcher, Ben Petersen, stated.
He is a recent UniSA graduate who undertook this research as part of his university degree.
Based on an existing model used in financial decision making – the Real Options Approach (ROA) – but with modifications to address the unique nature of naval ship planning, the researchers hope the formula will transform the way the Royal Australian Navy (RAN) manages its fleet.
“Warships typically undergo major upgrades every seven to 10 years, with a service life of approximately 30 years, unlike other industries that have much shorter product lifecycles. These upgrades are substantial in scale and complexity, and they often go way over projected budgets,” Petersen said.
Along with UniSA systems engineer Dr Mahmoud Efatmaneshnik, the pair recently presented their proposed model to the International Symposium on Systems Engineering, which was held in Italy in late 2024.
The research identified key benefits to adopting the ROA:
- Operational readiness – ensuring that naval assets remain technologically advanced and mission-capable over time.
- Cost Efficiency – more efficient budgeting, prioritising upgrades and maintenance that deliver the best value.
- Risk Mitigation – reducing the financial and strategic risks associated with overinvestment in outdated technologies.
- Sovereign Defence Capability – supporting Australia’s goal of strengthening its defence industry by improving long-term planning for sustainable ship building.
