State-owned arms manufacturer Denel has put much effort into driving innovation and technological advances, with a focus on operational excellence through improved programme management, supply chain efficiencies and cost reduction.
Denel is also improving access to international markets through greater teamwork with the South African Department of Defence and Military Veterans and with strategic international equity partnerships to secure international market access.
Denel is working closely with the Depart-ment of Defence and Military Veterans to secure greater government support in building stronger relationships with other countries, including African and emerging markets such as Brazil, Malaysia and Turkey, says Denel group CEO Talib Sadik.
“The South African defence industry bubble burst 20 years ago when government spending prioritised socioeconomic and infra- structure investments over defence funding. Austerity measures have also been put in place owing to the global economic crisis, resulting in further reductions in the defence budget,” he says.
Further, the efficiency of the defence spend is under review by Defence and Military Veterans Minister Lindiwe Sisulu, as a significant portion of the Budget spend is payroll related. The review will analyse the allocations of the defence budget on payroll, capital acquisitions and operational requirements.
Meanwhile, Denel has invested in the next generation of its unmanned aerial vehicle (UAV) to position itself strongly in assisting the Department of Defence and Military Veterans with border control, besides others in its product portfolio.
“The UAV would be effective for border control, internal security and paramilitary purposes. It will also be certified for civilian purposes, enabling use in nonmilitary applications, such as preventing cable theft and the protection of wildlife,” says Sadik.
He adds that this technology presents an opportunity to generate export business and to build on Denel’s current international client base of over 50 countries.
Additional investments have been made in the optical sight systems of Denel’s associate, Carl Zeiss Optronics, to increase its functionalities.
“Our company’s products contain locally created intellectual property, which can be used to effectively enter the export market for the benefit of South Africa,” he says.
Meanwhile, the limitations in the defence spend globally are resulting in an alignment between the military strategy of the country and the industrial strategy of the country.
In this way, the parties can examine options to optimise the defence spend and create jobs in the areas of science and technology, which is required in growing any economy.
Globally, owing to the cutbacks, there is greater military collaboration between countries. Industry has taken to interoperability, where companies and countries collaborate on training, as well as jointly explore the use of another country’s technology and equipment and combine equipment.
Further, Denel believes that, to be successful, the company must be part of the global supply chain and South Africa needs to embrace globalisation in the defence industry, Sadik concludes.