The task force interviewed and took briefings from more than 40 senior officials and experts from within DoD, other government agencies and the private sector. With an understanding that significant parts and functions of DoD's logistics enterprise have been extensively studied, task force. This helped to narrow the task force's focus to potential problem areas and to identify areas where change could be implemented and/or further efficiencies could be achieved.
Chief among the task force's efforts was the review of past and current logistics management models across the DoD. Another significant focus in the task group was on areas which... represent 'permanent problems' for the institute. In doing so, the working group aimed both to highlight the particular vulnerabilities in relation to a crucial aspect of the logistics business and to provide a general.
Due to the limited scope applied to the topic of Supply Chain Resilience, it was the first topic presented by the task force at the 20 October 2016 public meeting. Overall, the task force found that DoD employs highly dedicated professionals who are forward-thinking and committed to driving results and improvements in areas where they impacted the DoD's logistics enterprise.
BRAC
Congress does not dispute the need for efficiency, but remains concerned about the current reduction in military capabilities and the excessive costs and focus of the 2005 BRAC. The Office of the Secretary of Defense (OSD) has not established a process to ensure a timely security review of its support. OSD has rejected changes to the BRAC Act proposed by Congressman Adam Smith, ranking member of the U.S.
Costs to integrate each of the service's inventory management systems with DLA's systems were higher than expected based on costs to restock inventory at strategic distribution platforms, consolidate storage at forward distribution points, reallocate inventory between different distribution warehouses, and modify an existing contract. The focus of the A-76 competitive process is to create savings by reducing personnel costs by redesigning activities to be performed with fewer personnel (in-house or by the contractor). In addition, the Department of Defense needs to better understand the context of data relating to the for-profit logistics industry.
The DoD's 2014 Federal Activity Inventory Reform (FAIR) Act report, which assesses the number of active-duty military personnel in commercial activities, found that of the 1.3 million military personnel on active duty, more than 330,000 military personnel in are active duty – by far our most expensive workforce – serve in jobs that could be done by civil servants or contractors. Removing even 10 percent of the 330,563 active-duty conscripts from this category could free up $5.3 billion for combat and/or.
Supply Chain Resiliency
Maintain adequate public and private sector depot-level maintenance workloads to ensure adequate public sector industrial capacity, and. DoD should implement increased cybersecurity standards across both the domestic and foreign levels of the supply chain. DoD should centralize these efforts under a single lead entity to coordinate effectively with other executive and government agencies.
DLA Leadership Model
DWCF – DLA
DoD should continue to pursue another round of BRAC to reduce excess logistics infrastructure. DoD should evaluate where A-76 leagues best deliver immediate cost savings, validating a league closure. The Department of Defense should create a single definition of what constitutes "fully taxed lifecycle costs" of personnel and start tracking those costs across different workforces: active duty, surveillance, reserve, civilian, contractor, and federally funded research and research groups.
DoD must consider all cost elements including education, health care, and future retirement costs. The current commercial industry maintains pools of parts to support about 20,000 aircraft today, and DoD must be able to exploit this reality in order to achieve cost savings. DoD should strive to invest wisely by focusing depot repair on mission equipment and leaving commercial repair of dual-use systems to industry specialists.
And while the potential exists to threaten enterprise resiliency, DoD must also remain vigilant in its efforts to optimize its use. On behalf of the Chairman and the Defense Business Council, this study is respectfully submitted.
Defense Business Board
Logistics as a
Competitive Warfighting Advantage
Task Group
Background / Context
Terms of Reference (TOR)
Key Observations – Industry
Application of Industry Standards
Key Observations
Where Change is Needed -
Findings
Supply Chain Resiliency -
Recommendations
DLA Leadership Model -
Defense Working Capital Fund (DWCF) -
DWCF -
Base Realignment and Closure -
A-76 & Public-Private Competitions -
Congressionally mandated report requirement indicating what can be outsourced prior to reinitiating public – private competitions
10 USC 2466 50-50 Rule -
Maintenance (50 – 50 rule) applies an self-imposed constraint on Depot-level maintenance and repair
Specific aircraft programs are ripe to implement proven material
10 USC 2466 50-50 Rule/Leveraging Commercial Best Practices -
Logistics Recommendations Summary
D EFENSE B USINESS B OARD
The following underlined/red topics are "Key Observations" from the DRAFT Defense Business Board (DBB) brief regarding the Working Group study "Logistics as a Combat Advantage". The Defense Logistics Agency (DLA) would like to provide the following comments on the Key Observations summarized in Chart 2 of the DBB summary. DLA agrees that there are supply chain weaknesses – DLA had previously identified a number of these weaknesses.
We are creating a "cyber toolkit" used by all stakeholders affecting the workforce, customers and suppliers, to continuously monitor and assess DLA's key Cyber Terrain to avoid and where applicable, to mitigate disruptions in supply chain operations. The Office of Cyber Program Management will continue to pursue the implementation of the Cyber Resilience Integration Plan, with an emphasis placed on specific supply chain vulnerabilities. DLA employs a unique combination of capabilities in the areas of military and combat logistics, inventory/distribution/warehousing, supply chain management,.
DLA and the military will continue to provide an open and transparent approach to controlling costs and the resulting rate developments. During the annual program budget request cycle, DLA provides proposed DWCF rates to OSD Controller personnel and proposed rates to WCF representatives of the military services. DLA is successfully reducing the composite cost recovery rate (CRR) through self-imposed reductions, and our PBR 17 proposal will reduce it each year in FYDP.
In the period 2015, the moratorium also had consequences for DLA's pursuit of Performance Based Logistics (PBLs) schemes. The purpose of DLA PBL arrangements is not to convert activities or functions of government employees, but to allow a contractor to manage the supply chain for various parts and deliver these items directly to the customer. The functions and activities of DLA PLFA and the Distribution Center performed by federal employees will not fundamentally change, and management, operational and performance activities will continue.
Overall, DLA's A-76 program was rated GREEN from 2008 through 2013, when the last A-76 service provider completed its five-year operational period, both for performance and for exceeding budget savings goals. The costs of active duty military personnel assigned to the Defense Working Capital Fund are included in total operating expenses. DLA reimburses the military services for military personnel costs as defined in Volume 2B Chapter 9 and Volume 12 Chapter 12, DOD FMR Section 1202.
