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05302003

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R-TOC Best Practices: Reduced Supply Chain Response Times

Area: Supply Chain Response Times
Best Practice: Direct Vendor Delivery (DVD)
Pilot Program: Heavy Expanded Mobility Tactical Truck (HEMTT)

Initiative: The HEMTT program and DLA established a goal to improve support for the HEMTT and reduce costs by shifting from large DoD wholesale stockage to DVD support. A successor corporate contract was negotiated between DLA and Oshkosh Truck Corp. (OTC) in April 2000. Under the contract, OTC is required to deliver within 5 days via DVD.

Benefits: Over 1800 items have gone under DVD with a reduced recovery rate; the target by year-end is 2500 items. Since the October 1999 award of the original contract, over $3M in savings for HEMTT unique and common items have been achieved. DLA and OTC are exploring ways to expand coverage of the corporate contract and the use of DVD should expand throughout the HEMTT and similar programs.

Several efforts are also ongoing to expand and better measure the progress of this initiative. The first of these is the rebaselining of the entire HEMTT National Stock Number (NSN) population to insure inclusion of all DLA HEMTT-coded NSNs. The second is DLA's ongoing negotiation of a Strategic Supplier Alliance with OTC. This is a leading-edge DLA initiative to maximize information sharing and fully leverage customer buying power beyond the current corporate contract structure.

Besides reducing costs, the DVD contract has had other advantages. The reduction in inventories allows for more immediate impact of contractor design changes, the contractor's improved insight into asset visibility influences design changes, and the shared information gives both the contractor and the government increased retail consumption awareness.

Area: Supply Chain Response Times
Best Practice: Industrial Prime Vendor (IPV)
Pilot Programs: C/KC-135, F-16, and C-5
Initiative: The DLA's Defense Supply Center, Philadelphia (DLA/DSCP) awarded a long-term IPV contract aimed at providing improved fill rates and reduced cycle times for U.S. Air Force (USAF) Air Logistics Centers' industrial shops to include the C/KC-135 Programmed Depot Maintenance (PDM) line at Oklahoma City Air Logistics Center (OC-ALC), the F-16 maintenance line and landing gear shop at Ogden Air Logistics Center (OO-ALC), and the C-5 PDM Line at Warner Robins Air Logistics Center (WR-ALC). The IPV contractor keeps the bins close to the wrench turners filled for low cost consumable bench stock items such as fasteners, gaskets, seals, o-rings, etc. There are no requisitions and the customer does not pay until the point of use (monthly bill). Benefits: A 98% fill rate is required and there are incentives for the IPV contractor to reach a 100% fill rate. Total ownership costs have declined as a result of the improved fill rates for these items and the corresponding reduced cycle times and the reduction/elimination of government owned inventory for bench stock items.
Area: Supply Chain Response Times
Best Practice: Commercial Maintenance Agreement
Pilot Program: Aviation Support Equipment

Initiative: The Consolidated Automated Support System (CASS) is a Navy standard general purpose, multi function automated test system used to test and diagnose weapons system electronics. It is scheduled to consolidate 24 automatic test equipment (ATE) types to a single type. This will reduce the number of technical publications required from 624 to 4 disks, reduce the space required by a third, and reduce the personnel required to operate the equipment by half. The Consolidated Service Program (CSP) is a comprehensive commercial depot-repair agreement for CASS station component repair. The original CSP contract was signed with Lockheed Martin Information Systems (LMIS) in April 2000. The contract is an 8-year basic agreement for LMIS to provide services to multiple agencies. The contract is renegotiated annually based on actual demand, and the program office is planning to expand this type of contract to other CASS subsystems.

The contract requires 24-hour turn around time for Broad Arrow (downing failure) requisitions, and 30-day turn-around time for non Broad-Arrow requisitions. The contractor holds wholesale inventory. The contract provides an incentive award fee of 1 percent (to a maximum of 5 percent) for each 2 percent improvement in CASS station reliability.

The coverage of the CSP agreement is being expanded to include the CASS electro-optical configuration and the CASS High Power Operational Capability (HPOC) ancillary asset. Discussions with the USAF are also ongoing to investigate the feasibility of implementing a similar agreement for depot repair of the USAF and U.S. Navy (USN) Joint Service Electronic Countermeasures System Tester (JSECST) program in FY02. Initial production of the JSECST was approved in April 2001.

Benefits: The anticipated results of the contract include faster turn-around time for requisitions, reduced cost, onsite support availability, and improved reliability. The contract is providing 51 percent savings/cost avoidance over the prior depot contract repair vehicle. Supply Material Availability (SMA) is 95 percent, compared to 79 percent before the CSP was instituted, and SMA did not fluctuate during the higher operations tempo during Operation Enduring Freedom.

Area: Supply Chain Response Times
Best Practice: Virtual Prime Vendor (VPV) and Strategic Sourcing
Pilot Program: C-5
Initiative: The C-5 System Program Director and DLA have been working to improve reliability and mission capability and to reduce PDM cycle time at WR-ALC. DLA awarded a VPV contract to Lockheed Martin Logistics Services (LMLS) in December 2000. It is a 3-year indefinite delivery/indefinite quantity (ID/IQ) contract with two 2-year options and one 3-year option. The contract is limited to airframe parts (excluding engine and avionics) and covers more than 11,000 separate parts. Under the contract, LMLS provides tailored support to the WR-ALC PDM line and worldwide support for all C-5 operational customers. The contract will be phased in as government parts inventories are consumed. LMLS provides full supply chain management services in the area covered by the contract, including forecasting, establishing subcontractor base, purchasing, supply management, storage, and distribution. Key features of the VPV contract include:
  • An incentive plan for support above established metrics
  • Annual program management review conferences
  • A requirement for LMLS to move to government electronic commerce/ electronic data interchange (EC/EDI) interfaces within 60 days of contract award
  • Implementation by LMLS of a DVD/stocked material management strategy with emphasis on migration to DVD
  • An LMLS website to allow visibility of orders in process.

Under sponsorship of Air Force Materiel Command (AFMC), the C-5 program is also looking to develop comprehensive supplier relationships through a disciplined process of effectively purchasing materials, products and services to make the supply chain more effective and efficient. The strategic sourcing initiatives cuts across many weapon systems, centers, and agencies, and will consolidate many NSNs, provide longer-term periods of performance, and serve multiple users. C-5 strategic sourcing initiatives include: hydraulic manifolds, flight control surfaces, structural repair, and mechanical repair.

Benefits: The VPV contract requires performance metrics that will significantly enhance support to C-5 if LMLS performs to contract requirements for order to ship time, time on backorder, and lead time. If all options are exercised, the contract's potential value is $1.1B. Benefits of the strategic sourcing initiative include reduced administration (cost and time), economies of scale, and more reliable parts supply.

Area: Supply Chain Response Times
Best Practice: Reliability Centered Maintenance
Pilot Programs: EA-6B and Aviation Support Equipment

Initiative: The EA-6B Integrated Maintenance Concept (IMC) Team conducted a detailed Reliability Centered Maintenance (RCM) analysis on the EA-6B aircraft. RCM is an analytical process used to determine preventive maintenance tasks as well as provide recommendations for other actions necessary to maintain a required level of safety, maximize equipment availability, and minimize operating cost. The team documented the results of their analysis in an IMC Implementation Plan. This plan delineates revised intervals/maintenance levels (organic versus depot) for preventive maintenance actions.

This plan has been coordinated with fleet representatives and the NAVAIR Industrial Competency. The EA-6B IMC Integrated Product Team (IPT) briefed the NAVAIR IMC Review Board on November 17, 2000, and the implementation was approved in a December 2000 message from the Chief of Naval Operations (OPNAV). Results have been very close to projections.

The Aviation Support Equipment (ASE) Pilot Program has learned that 66 percent of the total cost of all schedule maintenance tasks for Common Ground Support Equipment (CGSE) is driven by 20 percent of the items. In an effort to reduce scheduled maintenance requirements, the program office has performed RCM analyses for selected items. These analyses have been performed by fleet equipment experts (operators and maintainers) under the guidance of a trained facilitator. Analyses for 21 different support equipment (SE) items was performed between FY98 and FY02, with an additional six items scheduled for FY03.

Benefits: The implementation of the IMC is expected to decrease EA-6B organizational level maintenance manhours by 121,185 per year (for 106 aircraft) and reduce aircraft out of service time (3,869 days/year for 106 aircraft). ASE reports significant reductions in scheduled maintenance requirements, reduced usage of consumables, and reduced disposal requirements for hazardous materials as a result of the RCM studies.

Area: Supply Chain Response Times
Best Practice: Condition Based Maintenance
Pilot Program: Advanced Amphibious Assault Vehicle

Initiative: Condition based maintenance (CBM) is "a set of maintenance processes and capabilities derived, in large part, from real-time assessment of weapon system condition obtained from embedded and/or external tests and measurements using portable equipment."

The AAAV ORD contains a requirement for overall design goals of ease of maintenance, achieved by "designing test points and self-diagnostics into the vehicle" and the concept "fix as far forward as possible." The program's solution is to utilize prognostics to reliably predict the remaining useful life of mechanical components, within an actionable time period and acceptable confidence limits. Implementation of CBM will provide asset management to operational commanders and to the support infrastructure, supports smart maintenance decisions, reduces the number of depot overhauls over the life of the vehicle, and avoids collateral damage. As vehicle integrator, General Dynamics Amphibious Systems (GDAMS) has begun program planning, data acquisition and fault characterization activities, marine/machine interface definition, and battery health and oil monitoring efforts.

Benefits: Implementation of CBM on the AAAV is expected to generate a return on investment (ROI) exceeding 35:1. The AAAV's CBM activities have served as one of the models for the OSD/Logistics and Materiel Readiness (L&MR) "Condition Based Maintenance Plus" (CBM+) initiative. CBM+ is intended to "improve the integration of maintenance, configuration management, and other logistics processes" through a wide variety of functions and features, including: prognostics/diagnostics, trend analysis, serial number tracking and asset visibility, integrated information systems, IETMs, and planned maintenance availability (PMA). CBM+ is included as one of six key components of the L&MR "Future Logistics Enterprise" activity.

Area: Supply Chain Response Times
Best Practice: Integrated Product Data Environment (IPDE)
Pilot Program: LPD-17

Initiative: The Integrated Product Data Environment (IPDE) is an information system capability which implements, through phases, the integration of a central product model database (Level I), associated data products such as drawings, technical manuals, GFI, training materials (Level II), and program execution information such as plans, schedules, and procedures (Level III) in order to satisfy the data requirements of both the Government and Industry Partnership.

Benefits: IPDE results in reduced costs for developing, delivering, and maintaining information. The data are entirely developed electronically, they are developed and entered only one time, and can be re-used throughout the life cycle for all 12 hulls. In addition, the IPDE will increase the accuracy and availability of data to end users. Members of the government-industry team will be able to access the data on-line, and there will be a single location for current ship configuration data. In addition, the extra costs incurred due to data re-hosting are eliminated by using IPDE. Over 1/2 of design and production data is re-used during O&S, both by ships force and by shore support activities. With the ability to reuse data, the program can avoid the need to replicate this information to populate external information systems for use during the ship's life cycle.

Area: Supply Chain Response Times
Best Practice: Interactive Electronic Technical Manuals (IETMs)
Pilot Program: HEMTT

Initiative: The original increment of R-TOC funding under PBD 721 provided funds for HEMTT to convert existing paper-based manuals to IETM format. Funding was received in October 00. This IETM was developed as an intrusive diagnostic tool for the maintainer, as opposed to a direct translation from paper manuals. The effort has achieved significant dividends in improved usability and supportability.

Initial actions included building a basic HEMTT IETM and developing subcontractor strategic partnerships with the OEM and the contractors selected to develop the IETMs. Subsequent actions included incorporating data from recent models, incorporating embedded training modules, devising a revised Repair Parts and Special Tools List (RPSTL) based on reconciliation of Logistics Support Analysis Report (LSAR) and Provisioning Master Record (PMR) databases, and incorporating latest engineering design changes.

Specific functional improvements include: (a) improved navigation within the IETM by consolidating task databases; (b) the addition of numerous additional troubleshooting tasks, which were systematically mapped to ensure coverage and logic flow; (c) consolidation of TM information from newer HEMTT variants to simplify the maintainer burden by leveraging system commonality; and (d) the addition of magnifying windows to enhance schematic reliability. The HEMTT IETM has been fully validated by soldier maintenance subject matter experts from the Ordnance Center and School, authenticated as an Army manual, and used to support the Type Classification/Materiel Release for the objective ESP configuration. It is now being fielded with that configuration with full maintainer training under Unit Set Fielding. The major ongoing activity with IETMs is the addition of Point to Point (P2P) schematic animation to provide additional visual tools as a general mechanics refresher and orientation. These advances also feed the companion IETM for similar OTC-produced military tactical vehicles as the program moves to embedded systems which encompass system health monitoring, diagnostics, data collection, and ultimately prognostics capabilities.

Benefits: Benefits of the IETM include:

  • Cost savings and cost avoidance opportunities
  • Diagnostic and prognostic capabilities
  • Reduced cycle time for troubleshooting
  • Reduced No Evidence of Failure (NEOFs)
  • Maximum leverage from existing palletized load system (PLS) IETM
  • Continued focus on soldier safety.
Area: Supply Chain Response Times
Best Practice: Diagnostic Test Equipment
Pilot Program: Airborne Warning and Control System (AWACS)

Initiative: Aircraft availability is a particularly serious issue for Low Density/High Demand (LD/HD) systems like AWACS. The Pinpoint Tester is a diagnostic test unit that recognizes and alerts the user to faults in circuit cards. It accommodates both analog and digital testing. Besides not performing as efficiently, the legacy tester is no longer supportable at the depot.

Benefits: The new system will provide superior diagnostic performance, substantially reduce life cycle cost, and improve aircraft availability. $8M in cost avoidance is projected within the Five Year Defense Plan (FYDP) alone, and the overall ROI is projected at 11.4:1. Funding for this project was approved in the most recent R-TOC PBD.

Area: Supply Chain Response Times
Best Practice: Commercial Buying and Management Initiatives
Pilot Program: C-5

Initiative: The Avionics Modernization Program (AMP) is an $850M, ACAT II program to modernize and upgrade major parts of the C-5 avionics. The AMP will meet new GATM requirements, and replace unsupportable flight control system and engine instrumentation. The project's vision is to provide a total GATM solution which reduces TOC by designing in the ability to easily adapt commercial standards and technology. This involves a considerable cultural change for the program. When the original concept, based on "reuse" and "upgrade" proved to be too complex, the contractor proposed using military product lines based on commercial product lines. The commercial systems approach provides a complete development-to-application environment and building block design.

Management of the C-5's two major modernization initiatives AMP and RERP has been reorganized into a single modernization team, with Lockheed Martin in the lead. Joint configuration control boards are also being developed.

Benefits: Benefits will include reduced sustainment and upgrade costs and reduced cycle time. By relying on commercial solutions to evolving international standards, the new capabilities can transition relatively easily to military product lines with minimized missionization for each weapon system. Testing and training is leveraged across systems.