In this period of transition between conflict and peace, defense acquisition and sustainment must find the balance between effectively supporting warfighters and the demand for more efficiency, a new report said.
The balance must also take into account the defense strategy’s call for support if a larger force structure must be reconstituted.
The Defense Department doesn’t need to reinvent the wheel, but expand some new, but existing approaches, says Daniel Goure of the Lexington Institute in his new report: “Toward a 21st Century Logistics Enterprise.”
More than a decade of conflict demonstrated there are innovative approaches to procurement and supply chain management that can serve as the basis for an acquisition system that is “smart, simple, flexible and relatively cheap.”
These solutions have also shown the ability to reduce indirect costs associated with management and oversight, as well as the costs of products and services, the report said.
These new approaches show performance can be improved, lead times reduced, and money saved. In addition, commercial best practices can be applied to managing large, ongoing DoD acquisition and distribution programs.
Innovative approaches show common features, the report said, including consolidating numerous contracts, increasing competition, simplifying contracting mechanisms, improving access to commercial and niche vendors, improved oversight, reduced costs, and a reduced need for inventories and infrastructure.
And, these approaches are seen as being more responsive to customer requirements.
One of the most important features of programs such as the Defense Logistics Agency’s (DLA) Tailored Logistics Support Program (TLSP) is the ability to provide for effective and responsive contracting at the same time they require continuous competition, the report said.
“Balance is achieved by creating long-term, multiple award contract vehicles or Basic Ordering Agreements that provide customers the assurance that the winning contracts possess the experience, size, flexibility and resourcefulness to meet changing demands,” the report said. “Competition is focused where it belongs: at the product or service level. As the rapid pace of technological change continues in so many sectors, forcing the locus of competition down to the lowest level possible is an imperative.”
The TLSP, the Naval Sea Systems Command’s SeaPort-Enhanced and the Army Sustainment Command’s Enhanced Army Global Logistics Enterprise all have demonstrated “a remarkable ability to streamline the procurement and supply chain process while simultaneously improving responsiveness and reducing costs.”
DoD could expand such techniques, Goure said.
“For example, DLA’s TLSP system could be expanded to other types of procurement such as communications and surveillance systems, as well as soldier clothing and individual equipment. The department also should seek to expand the current, limited use of performance-based logistics contracts.”
Additionally, the report said DoD should get out of supply chain management “to the maximum extent possible,” and turn it over to the private sector.
As well, DoD should expand the “current, limited” use of proven performance-based logistics contracts (PBLs).