Home INTERVIEWS Prof. Dr. İsmail DEMİR, President of Defence Industries: “Turkish defence and aerospace sector’s competence in project management and mastery of projects have been developing gradually.”

Prof. Dr. İsmail DEMİR, President of Defence Industries: “Turkish defence and aerospace sector’s competence in project management and mastery of projects have been developing gradually.”

by MSI

The Turkish-language version of MSI TDR published its 200th issue in November. One of the main motivations behind the launch of MSI TDR was the outcome of the Defence Industry Executive Committee meeting of May 2004, which brought about an almost complete overhaul of the Turkish defence and aerospace sector. As a result of the decisions taken during the meeting, Turkish companies took over the role of main contractor in projects to develop platforms that are today part of the inventory. Prof. Dr. İsmail Demir, President of Defence Industries, explained the factors behind this success, the role of the printed media within this process, and important issues regarding the future of the sector for our readers.

MSI TDR: Prof. Dr. Demir, to begin with, can we first talk about the role of the Presidency of Defence Industries (SSB) in the development of the Turkish defence and aerospace sector. At a time when the sector was just beginning to develop indigenous products, when the risks were relatively higher, what was the SSB’s approach to project management that both kept the end user satisfied and allowed indigenous products to see the light of day?

Prof. Dr. İsmail DEMİR: End users, both in the defence and aerospace field and in every other field, want to access and use the products they have purchased as soon as possible. They also expect the best possible quality from the said product. In the context of the defence and aerospace sector and Turkey, the main question was how we could bring our domestic industries into the process of product development at a time when it was apparent that we were lagging considerably behind in the technological and industrial fields. The answer was to operate a “patient and persistent” process.

The defence sector in Turkey, operating under the leadership of the Turkish Armed Forces Foundation companies, is mostly a sector in which the said companies take on jobs and distribute the work. We want the Turkish defence sector to develop, with the foundation companies playing the role of integrator, while at the same time expanding the base of the sector.

Someone had to set this process in motion and to ensure it kept running. With the end users, there were instances where the required patience was shown, perhaps due to some personal initiatives, however, those examples were not sustainable. The SSB played a role in ensuring this sustainability. We continued to push the message: “Let’s focus on domestic products; let’s trust our domestic industries rather than foreign products!”, and gained the support of end users to some extent. The presence of the SSB kept this emphasis alive, ensuring that it never fell off the agenda. Had we not achieved this, the emphasis on domestic products would have become a secondary priority, often with such excuses as: “A problem arose in this domestic product” and “This domestic product is worse than this foreign product due to this or that reason.”

In this process, the SSB maintained a continuous agenda, questioning how much a foreign supplier will contribute to domestic industry, and what they will do to develop the domestic sector in all externally sourced procurement projects. On some occasions, after inquiries such as, “Instead of buying more products, can we get domestic industries to do the following? Can we bring this technology?”, we attempted to increase the share of domestic production in the sector.

In my opinion, keeping domestic industry alive and on the agenda of the end user, industrial circles and foreign stakeholders has been the most important role we have undertaken in this process.

Within this process, our competence in project management and our mastery of projects have also been developing gradually.

In other public procurements, an approach similar to the one we adopted in the defence and aerospace sector may help in making the National Technology Move more successful in terms of industrialisation. We are pleased to see a similar model being adopted by the Ministry of Industry and Technology, but besides the model itself, the implementation of the model has also many dynamics. These dynamics should be analysed very carefully, potential risks should be identified and the necessary precautions should be taken.

Through the MİLGEM project, the Turkish defence and aerospace industry proved itself in the field of naval platforms.

MSI TDR: In this process, the SSB went beyond the powers and means it was given at the time of its establishment, and after the necessary legislation changes were made, it started to implement new practices. The establishment of SSTEK is among the first such implementations that come to mind in this regard. What kind of process brought these new practices from idea to action, and then to implementation? What contributions and benefits did these practices bring to the development of the sector?

Prof. Dr. İsmail DEMİR: In fact, there were some elements that were overlooked at the conceptual level, and we can say that we paid more attention to these elements. One such element I often bring up is in the name of the fund that we draw from: The Defence Industry Support Fund. The support of the defence sector is among our main duties, and this should be the purpose of the fund. Studies that will improve the sector should also be prioritised in practice.

The defence sector in Turkey, operating under the leadership of the Turkish Armed Forces Foundation companies, is mostly a sector in which the said companies take on jobs and distribute the work. We want the Turkish defence sector to develop, with the foundation companies playing the role of integrator, while at the same time expanding the base of the sector.

Sometimes, with the popularisation of the defence and aerospace sector in Turkey, the political and promotional aspects come to the surface. Here, it is important to stay within the limits. You need a reliable source that keeps track of such limits, that is to say, one that provides authentic news and relies on technical knowledge rather than demagogy. Here, I find the role of MSI TDR to be very important, as there are also entities that exaggerate the subject, or try to belittle or humiliate it to make it appear deficient.

The involvement of the private sector is also an important matter. Of course, when it comes to the private sector, there are issues of profitability and whether the sector is sufficiently attractive for investment. Certain areas can be seen as profitable. In special areas that require technological depth, however, there are sometimes no companies at all. Sometimes there is a mess, and sometimes there is potential that cannot be exploited.

Through SSTEK, which emerged as a result of all these factors, we aimed to provide support to an unfilled gap in the sector. We wanted to find out if there were any entities with an entrepreneurial spirit and the ability to apply a certain level of knowledge and technology, but that fell short of implementation for whatever reason, that had great ideas, or that had a scattered structure that needed to be concentrated around a certain purpose. We planned to encourage these entities, to involve ourselves in these entities as a partner or investor if needed, and to realise the relevant product by getting those structures up and running. We needed a structure like SSTEK to acquire technological depth.

The operational successes of platforms such as the T129 ATAK helicopter increases the international recognition of the Turkish defence and aerospace sector.

SSTEK does whatever is needed to provide the necessary support. For example, if there is a need to start a company, it does, and afterwards, this company may slowly recruit partners from the sector. The main purpose of SSTEK is to support their initiatives until they can establish a sustainable structure, after which SSTEK will then withdraw completely or remain as a minor partner with a small share, thus continuing the support that comes with its presence.

It has never been our aim to create a state structure offering life support, dominated by SSTEK. SSTEK should never be seen as government interference into the sector. We hear such comments from time to time. What we want to stress over and over again is that SSTEK plays a purely energising, supporting and stimulating role.

We believe in the private sector and its continued vitality. On the other hand, it is a known fact that in the defence sector, the private sector always receives work from the state – this being a very special area where they are not at liberty to sell their products to anyone they wish. As such, the state will always be present. This is inevitable.

From time to time, the idea of establishing an export company is considered, and we need to reassess the feasibility of this idea. Regardless of what we call it, I believe a system that directs, commands and coordinates is a necessity that stands before us.

MSI TDR Strikes a Very Good Balance

MSI TDR: How have media organisations contributed to the process since 2004? Could you provide us with your evaluation of MSI TDR here as we prepare to bring the 200th issue to our readers?

Prof. Dr. İsmail DEMİR: The sectoral media plays several roles. First, it maintains the flow of news and information to young people with an interest in the sector. For example, we organise various events that are exciting to young people, and the sectoral magazines are very important in promoting these. The presence of such publications in Turkey has an impact in the eyes of the public and young people, as if you have an innate interest in defence, aerospace and technology, you need resources if you are to keep track. Resources that provide you with inside news and with details of the latest developments are important. Let me give myself as an example. In my teenage years in the late 1970s, I would eagerly read M5 magazine, as it was called back then. I would write letters to companies such as General Dynamics and Rockwell, and they would send me brochures and pictures in return. My room was covered with these pictures.

Following on from the Bayraktar TB2, the AKINCI UCAV shows that Turkey can maintain its edge in UAVs with new generation systems.

Of course, sometimes, with the popularisation of the defence and aerospace sector in Turkey, the political and promotional aspects come to the surface. Here, it is important to stay within the limits. You need a reliable source that keeps track of such limits, that is to say, one that provides authentic news and relies on technical knowledge rather than demagogy. Here, I find the role of MSI TDR to be very important, as there are also entities that exaggerate the subject, or try to belittle or humiliate it to make it appear deficient. We need to be able to provide reliable information to both the domestic and foreign public, and in this respect MSI TDR is an important source of information about what is happening in Turkey and what is being done.

There is also the tabloid aspect. If you focus entirely on technology, you attract a narrower audience, but if you go the other way to tabloidisation, demagogy follows. It is necessary to strike a balance between the technology and tabloid approaches, and in my opinion, MSI TDR does this very well.

Once the ALTAY main battle tank enters into serial production, it is expected to achieve significant success, like the other original platforms of the sector.

A New Structure Needed for Exportation

MSI TDR: You often emphasise the importance of exports for the commercial sustainability of the sector. How would you evaluate the export performance of the sector? What do you think of the current situation?

Prof. Dr. İsmail DEMİR: As we keep iterating: defence exports are never merely a commercial matter, as there are a number of other relevant aspects, including politics and the geopolitical situation. For example, the perception of the technological level of our country is important. We see that this perception is constantly developing in a positive direction. The successes achieved with domestic products, especially in operations undertaken by the Turkish Armed Forces and security personnel, has drawn considerable attention to Turkey. This attention, particularly in the case of Western countries, often precedes embargoes or restrictions of the sale of various parts, while other countries take a more positive approach in which the focus is on cooperation.

One of the most ambitious projects of the Turkish defence and aerospace sector is the National Combat Aircraft.

On the commercial side, as the flagships of the sector, the foundation companies maintain their export operations autonomously and independently. Time and again, ideas of how to make export activities more efficient, channelling these activities through a certain structure, or bringing them together under an umbrella organisation are brought up. In general, I find that such ideas are not welcomed, as it seems everyone would rather handle their own business. However, we do find that the level and number of major exports are not satisfactory.

This brings me to our structural problems. It is clear that our business needs to be structurally reorganized. In particular, we need to call a halt to the opening of several different offices and the establishment of agencies in the same country by the foundation companies, working independently. Some coordination is needed. It is also necessary to prevent private sector companies working in the same field from stepping on each other’s toes abroad.

Striking a balance here is also important. That’s why we want to be a little more sensitive and careful, and to resolve the issue over an extended period of time. Neither a hard-line stance like, “Alright, you need to abide by this system; you can’t act without permission; you can’t sell products” nor a looser approach in which “everyone is free to do as they want” will make the cut. What we need here is a system that maintains the balance, that gives directions and that prevents fatal competition where needed, while at the same time preventing injustices.

Guided munition solutions, such as the ATMACA Surface-to-Surface Guided Missile developed by Roketsan, support the platforms developed by the sector.

From time to time, the idea of establishing an export company is considered, and we need to reassess the feasibility of this idea. Regardless of what we call it, I believe a system that directs, commands and coordinates is a necessity that stands before us. The civilian sector would also be included, and there should be a system through which the state cooperates with civil initiatives, along the lines of the SSI-SASAD relationship. I believe this system needs to be one that can prevent possible complaints from arising in the future, one that is fair yet moderating, and one that raises the international standing of our country. We need to sit down with our industries and address this issue together.

MSI TDR: What kind of role do you foresee for the sectoral press in the future? What are your expectations from us?

Prof. Dr. İsmail DEMİR: Firstly, sectoral press needs to be sensitive in showing the real picture. Secondly, regarding the broad base of the sector, it should highlight any competencies, skills, potentials, structures and civil sector elements that can contribute to the defence sector, and that we may have overlooked. I think it is very important to draw attention to these, and encourage them through industry publications. In addition, it may be highly beneficial for us if the sectoral media radars are kept active on the lookout for exemplary activities and technologies abroad.

On behalf of our readers, we thank Prof. Dr. İsmail Demir, President of Defence Industries, for taking the time to answer our questions and for providing us with such valuable information.

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