MLF 6-5 (June 2012)

Defense Logistics Agency

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Supply Optimizer Redding HobbyActing Director, Defense Logistics Agency Logistics Operations Directorate

Energy Expertise O Cases and Containers O Building Partnerships Land & Maritime, Aviation, Troop Support O Maj. Gen. Ken Dowd

The Publication of Record for the Military Logistics Community

Vice Adm. mArk d. HArnitcHekDirector, Defense Logistics Agency

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June 2012Volume 6, Issue 5

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Military logistics ForuM June 2012 VoluMe 6 • issue 5

Features coVer / Q&a

19

DepartMents

Dan Keefeexecutive Vice President and Group

General managermantech technical Services Group

32

Mr. Redding Hobby Acting director

defense Logistics Agency Logistics Operations directorate

2

4

16

31

Editor’s Perspective

Log Ops/People

Supply Chain

Resource Center

inDustry interView

9

The Shipping NewsHow packages, cases and shipping containers are evolving in today’s agile, energy-conscious military. From small cases to large containers, it all ensures the safe arrival of critical components.By Heather Baldwin

14

Energy ExpertiseAs a primary level field activity of the defense Logistics Agency, dLA energy is the agency’s fuel supplier, providing the equivalent of approximately 144 million barrels of fuel, energy and power, worth about $20 billion in the last fiscal year.By Henry canaday

26

Not Up in the AirdLA Aviation’s mission is to take the unknowns out of the aviation supply chain, while reducing costs and wait time.By christian Bourge

6

DLA Land and MaritimeLand and maritime supply chain develops synergies with industry partners to drive down costs and gain efficiencies.By Peter Buxbaum

29

For the TroopsWith nearly $15 billion in sales projected for this fiscal year, the defense Logistics Agency’s troop Support would rank in the top third of the Fortune 500. However, it operates under conditions and constraints that similarly sized private companies don’t.By Hank Hogan

12

Organizing for SuccessMLF talks with major General kenneth dowd, the incoming director of defense Logistics Agency Logistics Operations, about the success of the 1st Sustainment command (theater) and transition to dLA.

exclusive interview withVice Admiral Mark D. Harnitchekdirectordefense Logistics Agency

Building Partnerships Q&A with Amy Sajda

DLA Top Contracts FY11

DoD Procurement Technical Assistance Program

deFenSe LOGiSticS AGencySPeciAL PULL-OUt SUPPLement

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All it had to do was be boosted into space on top of a rocket, circle the earth, come within 33 feet and sync up its orbit with the International Space Station, before being grabbed by a robotic arm and placed into a docking position. And so far, Dragon has performed as expected/hoped/prayed it would. Another huge step in the use of unmanned platforms for resupply has been demonstrated by SpaceX’s Dragon spacecraft.

While certainly not the first use of unmanned space modules to resupply in-orbit platforms, it was the first by a commercial company in what is hoped will be the first steps toward a more commercially-based space operation, where the government is not bearing all the cost burden for some space missions where their overhead costs could make missions much more expensive, especially if the U.S. has to rely on the space agencies of other countries. While much of the research and development was funded by NASA, along with the carrot of a $1.6 billion supply contract, SpaceX is counting on other customers in this brave new (commercial) space world.

Unmanned supply missions are proving their worth in Afghanistan. Harsh terrain and a poor ground network make overland supply difficult, and constant threats at almost every point along those routes are road markers for alternative supply options. Aircraft—manned and unmanned—are taking up the slack and saving lives, especially when delivering routine necessities like water and fuel. While distance and other complexities are apparent between supplying the ISS and a mountaintop FOB, supplies are supplies and unmanned is unmanned.

In essence, the SpaceX long-range supply mission is reflective of supply chains everywhere. When the number of routes and/or options are limited, the cost to maintain and operate that supply chain will be high. Case in point, the PAKGLOC. Routes into Afghanistan are either difficult or long, and in most cases, both! U.S. planners had been anticipating some form of supply chain interruption, so when Pakistan closed the route, other routes were avail-able—albeit they take longer and cost more, but they are keeping the supply chain functioning.

As an aside, if you look at the family of KMI Media Group magazine’s listed below, you will note a difference from the last issue—we have added a new magazine! Launching in June is KMI’s 11th title, Border & CBRNE Defense. It will cover the homeland security, border patrol and CBRNE communities across the military, federal, state and local governments. With the same style and depth of coverage as our other 10 titles, BCD is focused on the decision-makers and the operators out on the frontlines of homeland defense.

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Editor-In-ChiefJeff McKaughan [email protected] EditorHarrison Donnelly [email protected] Editorial ManagerLaura Davis [email protected] EditorLaural Hobbes [email protected] Baldwin • Peter Buxbaum Henry Canaday • Cheryl Gerber • Hank Hogan Leslie Shaver

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Art DirectorJennifer Owers [email protected] Graphic DesignerJittima Saiwongnuan [email protected] Designers Amanda Kirsch [email protected] Morris [email protected] Waring [email protected]

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Compiled by KMi Media Group staffLOG OPS

New Land Vehicle Support Venture

DynCorp International, Force Protection Industries, Oshkosh Defense and McLane Advanced Technologies have announced a new joint venture—Mission Readiness—to serve the U.S. and coalition forces’ essential vehicle main-tenance needs in austere combat environments. Mission Readiness is a standalone company exclusively dedicated to bringing its collective 170 years of team experience in the manufacture and logistical support of land vehicles.

“There is no job more important than keeping our troops safe and mission-ready,” said James Grazioplene, Mission Readiness chief exec-utive officer. “Mission Readiness is 100 percent focused on ensuring that the warfighter will have the vehicles they need for the fight, every day.”

Mission Readiness provides a best value, low risk, technically superior, global solution for TACOM LCMC, through its unique team, which blends the expertise, experience and commitment of its four large partners. Mission Readiness’ effec-tiveness and reliability are proven: collectively the team currently supports 94 percent of the MRAP

FOV in-theater defined as Afghanistan, Iraq and Kuwait, as well as CONUS, with a footprint of more than 17,000 personnel on the ground today.

“In the past year, the Department of Defense message from Dr. Ashton Carter to industry has been loud and clear: be leaner and more effi-cient,” said DynCorp International chairman and CEO Steve Gaffney. “Through this team we’ve answered that call for efficiency and enhanced the value to the government. We pulled together the absolute best providers of MRAP FOV support in an innovative, standalone company that keeps costs to the customer at a minimum while maxi-mizing customer focus.”

“Force Protection takes great pride in the vehicles we have built and in the lifesaving perfor-mance of the RCV and MRAP fleets in general,” said Michael Moody, president, Force Protection Industries. “We look forward to helping to sustain these vehicles as vital components of our Armed Forces for many years to come by helping to provide essential, best value total life cycle support services.”

“The Mission Readiness team will deliver supe-rior MRAP design and production expertise and extensive in-theater sustainment experience to the warfighter,” said John Urias, president of Oshkosh Defense. “Together, we can offer new levels of MRAP performance to warfighters—supporting an expanding range of critical missions, and ulti-mately getting them home safely.”

“Technology-driven solutions are essential for streamlining operations, saving money and sustaining a military prepared for the future,” said Drayton McLane, chief executive officer, McLane Advanced Technologies. “The industry knowledge and technology experience within the Mission Readiness team will manage fleet resources efficiently, keep costs under control, and enable military readiness.”

The U.S. Army TACOM LCMC issued a request for proposals on June 7, 2011, for contractor logistics sustainment and support for the MRAP FOV. The five-year contract is valued at a total of more than $3 billion, if all options are exercised.

Compiled by KMi Media Group staffPEOPLEMatthew Beebe has been assigned as deputy director, Defense Logistics Agency acquisition, Defense Logistics Agency, Fort Belvoir, Va. Beebe previ-ously served as executive director, operational contract support, Fort Belvoir, Va.

Army Reserve Colonel Francisco A. Espaillat, has been nominated for appointment to the rank of brigadier general, and for assignment as mobi-lization assistant to the deputy director (individual mobilization augmentee), Defense Logistics Agency, Fort Belvoir, Va. Espaillat

is currently serving as project manager, combined arms tactical trainers (Army Guard Reserve), Program Executive Office-Simulation, Training and Instrumentation, Orlando, Fla.

Edward Case has been assigned as vice director, Defense Logistics Agency, Fort Belvoir, Va. Case previ-ously served as director, Defense Logistics Agency information operations, Fort Belvoir, Va.

Brigadier General Susan A. Davidson, deputy commanding

general/director of operations, Military Surface Deployment and Distribution Command, Scott Air Force Base, Ill., has been assigned to commander, Defense Logistics Agency-Distribution, Defense Logistics Agency, New Cumberland, Pa.

Brigadier General David A. Harris, vice commander, Air Armament Center, Air Force Materiel Command, Eglin Air Force Base, Fla., has been assigned to commander, 96th Test Wing, Air Force Materiel Command, Eglin Air Force Base, Fla.

Colonel Michael T. Brewer, who has been selected for the rank of brigadier general, commander, Arnold Engineering Development Center, Air Force Materiel Command, Arnold Air Force Base, Tenn., has been assigned to commander, 412th Test Wing, Air Force Materiel Command, Edwards Air Force Base, Calif.

Colonel Cedric D. George, who has been selected for the rank of brigadier general, commander, 76th Maintenance Wing, Oklahoma City Air Logistics Center, Air Force Materiel

Command, Tinker Air Force Base, Okla., has been assigned to commander, Warner Robins Air Logistics Complex, Air Force Materiel Command, Robins Air Force Base, Ga.

Colonel Allen J. Jamerson, who has been selected for the rank of brigadier general, chief of staff, Headquarters Air Force Materiel Command, Wright-Patterson Air Force Base, Ohio, has been assigned to director, security forces, deputy chief of staff, logistics, installa-tions and mission support, Headquarters U.S. Air Force, Pentagon, Washington, D.C.

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The Defense Logistics Agency has long sought to save money for the U.S. Department of Defense by aggregating the purchasing power of the military services and agencies on millions of items of parts and supplies. In an era of tight military budgets, and with drawdowns from theaters of operation further constricting spending, the DLA’s mis-sions of savings and efficiencies have become all the more emphasized.

The practices employed by DLA’s land and maritime supply chain group in Columbus, Ohio, are examples of how innovative acquisitions and contracting strategies can pay off for DoD as a whole. The fact that two supply chains, land and maritime, came to be managed together was coincidental, but it has yielded synergies which promote savings and efficiencies. The group has also developed synergies with industry partners, primarily in the form of long-term contracts and strategic alliances, to drive down costs and gain efficiencies. The vendor com-panies, for their part, work consistently to do the same.

“The DLA land and maritime group’s overall mission is to support two supply chains for DoD,” said Ben Roberts, DLA’s deputy director, land supplier operations. “The land supply chain involves largely spare parts to repair or rebuild land-based systems like tanks, HMMWVs and MRAPs. On the maritime side, we also manage spare parts to support maritime system and there is also a heavy component of electronic parts that cross different types of weapons systems.”

Management of the two supply chains coexisted in Columbus before they were organizationally aligned in 2005. “The workforce was already here,” said Roberts. “We do get some efficiencies managing the two supply chains together.”

“There are OEMs, distributors and manufacturing representa-tives that we do business with that are common to both the land and

maritime supply chains,” added Ste-phen Rodocker, director, DLA land and maritime strategic programs. Overall, the group manages some 2.4 million items, as many as 67,000 of which generate significant activity.

“DLA has the enormous task of providing the armed services and other agencies the full spectrum of logistics and technical services,” said John Bryant, vice president and gen-eral manager of joint and marine programs at Oshkosh Defense. Oshkosh is one of the largest suppliers of wheeled tactical vehicles to the U.S. military.

“DLA provides over 80 percent of the spare parts to keep equip-ment mission ready,” Bryant added. “DLA has long leveraged com-petitive contracts to keep costs down. But at a time of drawdowns and shrinking budgets, there is additional pressure to lower costs. All this is happening as the volume of equipment coming back and in need of repairs is increasing.”

Oshkosh has had a strategic supplier alliance with DLA since 2008 through which the company supports the agency with parts supplies and services. “We collaborate very closely with DLA,” said Bryant. “We incorporate lean strategies to lower costs and improve quality and we incorporate advanced demand planning and quality control to provide parts the customer needs at very affordable rates.”

Besides providing advantageous pricing, Oshkosh’s alliance with DLA has reduced wait time for orders, more accurate demand

John Bryant

Land and maritime suppLy chains innovate to generate efficiencies. By peter BuxBaum

mLf correspondent


forecasting, lower administrative costs and a streamlined negotiation process. “As a result, a comprehensive contract can last several years,” said Bryant, “as opposed to establishing large numbers of contracts with a sole-source vendor and pricing purchase orders one at a time. It’s much more efficient for the customer and it works well for us also.”

Strategic alliances and long term contracts are among the corner-stones of DLA’s strategy to drive efficiencies to the land and maritime supply chains. “Long-term contracts with suppliers enable us to reduce the time is takes to put something on contract and allows us to reduce inventory and better support our customers,” said Rodocker. DLA has established these relationships with Navistar, Force Protec-tion and AM General, as well as with Oshkosh and others.

“These programs take a top-down approach and are very struc-tured,” Rodocker added. “We establish a charter with each company to lay out goals to be achieved. We always focus on improving customer support and reducing the costs of the products.”

The approach starts with creating joint teams among DLA and company representatives to manage certain products or classes of products. “We establish a battle rhythm with our suppliers and we meet with them regularly,” said Rodocker. “We establish joint steer-ing groups to work on issues and problems and to come up with resolutions and we track how they are doing. We have found that this approach results in a much improved working relationship with sup-pliers.”

Around 65 percent of the dollars spent on land spare parts and 30 percent in the maritime supply chain are now managed through

long-term contracts, typically lasting three to five years. “It has had a huge impact,” said Roberts. “It reduces labor costs because you don’t have to spot buy every time there is a requirement. It also reduces inventory levels and provides better customer service.”

There are a number of criteria that DLA looks for to place items on long-term contracts. “They should have stable technical character-istics,” said Rodocker. “Items with good spend histories and recurring demand are also key for long-term contracts. That is also what compa-nies are looking for to provide us with a good business deal.”

The DLA land and maritime group has an arrangement with AM General LLC, an HMMWV OEM, designed to reduce inventory levels while improving customer support. “AM General provides spare parts to HMMWV rebuild lines at the Red River and Letterkenny army depots,” explained Roberts. “They plan the requirements and leverage their commercial as well as DLA’s organic supply chains in order to deliver parts to production lines at the depots.”

The DLA-AM General arrangement has succeeded in reducing inventory levels as well as line stoppers, situations necessitating a work stoppage because of the lack of parts, according to Roberts. The program has rebuilt over 43,000 HMMWVs since the inception of the program.

Another example of such a strategic alliance revolves around the supply of water purification systems. DLA engaged Aqua-Chem Inc. through a competitive bidding process to perform demand forecasting for water purification equipment as well as stocking and supporting DLA customers directly with those systems.

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“The idea is to tap into industry capabilities and expertise to do a better job than we could do on a macro level,” said Rodocker. “In this way we are able to reduce costs, improve parts support and provide better troubleshooting for the customer.”

Oshkosh Defense has several long-term contracts with DLA land and maritime, including the recently awarded hybrid long-term con-tract. “What we did was to identify this population of parts that had significant recurring demand to make them eligible candidates for long-term contract coverage,” said Lorinda Lewis, Oshkosh Defense’s director of DLA programs. “We did a lot of analysis to help DLA under-stand the buying patterns of the customer from us and from DLA and helped them to determine appropriate parts to add to the contract. We also estimated annual demands for the parts.”

Hybrid covers a variety of products that are included on many plat-forms. “They are not unique to one specific vehicle,” said Lewis. “DLA is looking for coverage. If there is enough demand it can be added to a long-term contract. It saves DLA the administrative burden of issuing one-time contracts over and over.”

Each contract has its own performance specifications, most of them surrounding on-times deliveries. When products are added to existing long-term contracts, the performance criteria applicable to that contract automatically prevail for those added parts. Many of the parts contracts have users, rather than DLA, ordering parts directly from the vendor.

Demand planning is one of the cornerstones of streamlining sup-ply chains. Both DLA and its vendors engage in this activity.

In the early 2000s, DLA deployed a planning and forecasting module from Manugistics, a company which has since been absorbed by JDA, and integrated that with its SAP enterprise resource planning system. DLA started feeding Manugistics with data in 2003. In 2006, all items subject to demand forecasting—around 80,000 faster moving products with recurring demand—were in the system.

Manugistics gathers historical demand data and applies those through algorithms to several different categories of items that DLA carries. Current programmatic intelligence, as well as seasonal and cyclical elements, can also be added to the forecasting mix.

“The accuracy of the demand forecast depends on the item and on its design stability,” said Roberts. “Demand for new systems such as the MRAP, which was first fielded in Iraq, is more difficult for any statisti-cal forecast to plan. The system can take into account current demand information supplied by customers.”

“Oshkosh uses advanced demand planning allows us to provide very quick contract pricing and very quick product delivery,” said Bry-ant. “We are working with the DLA supply chains to constantly refine demand planning and refine prices to drive parts prices down over time and in order to provide just-in-time deliveries to customers. It allows us to provide a precisely quoted price and to complete delivery a short period of time after a request for quote is issued.”

One demand planning technique that Oshkosh Defense has refined is to analyze demand for products based by demand stream. In other words, demand for a part is analyzed separately depending on whether part was ordered on a long-term contract, short-term contract, or spot buy.

“This gives us better visibility into patterns of demand and it has allowed us to refine the demand planning process,” said Lewis. “When we look at each demand stream individually we can see how demand is changing from the perspective of the customer base and it enables us respond to customers appropriately. It allows us to adjust on-hand quantities to better match demand patterns. Analyzing demand streams as a group produced a lot of noise and in variability of demand. We also use an application that allows us to see how accurate our demand planning is.”

DLA’s strategy of combining long-term contracts with demand planning has reduced inventory levels and saved DLA and the taxpayers money. “Inventory levels would definitely be higher because we would have to make spot buys at higher material costs,” said Rodocker.

From Oshkosh’s perspective, the process is all about reducing costs and improving deliveries and quality over time. “We are con-stantly re-examining and remapping the entire value chain in all of our commodity and service areas to make continuous improvements,” said Bryant. “We work hard to ferret out inefficiency from the earliest stage of the value stream and the lowest level supplier all the way to customer delivery.”

“DLA is seeking cost reduction across its range of contracts,” said Lewis. “They are taking a hard-nosed approach to any price increases. If we have a cost increase, no matter how insignificant, they are look-ing for an explanation for why our costs and theirs went up. We work hard with our own supply base and challenge them. We can sometimes evaluate an opportunity to buy in larger quantities in order to reduce costs for the customer when we see that there is demand across mul-tiple demand streams.”

“We are not that different than big businesses in the private sec-tor,” said Roberts. “They develop long-term contracts and good work-ing relationships with key suppliers and so do we. Working with and building our industrial base is one of our key focuses.” O

Lean Management of Logistics: WarfighterSupport and Stewardship Excellence

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Vice Admiral John T.Blake, USN, Integration ofCapabilities & Resources,Deputy Chief of NavalOperations

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Major General WendyM. Masiello, USAF,Deputy Assistant Secretaryfor Contracting, AssistantSecretary of the AirForce for Acquisition

Redding Hobby, SES,Deputy Director of LogisticsOperations, DefenseLogistics Agency

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Rear Admiral Patricia E Wolfe, Director – JointReserve Force, DefenseLogistics Agency

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At first glance, the containers used to ship military equipment and supplies around the world appear not to have changed much over the past half-century. Walk into any shipyard and the same cranes seem to be moving the same containers they moved roughly 60 years ago when container sizes became standard-ized worldwide.

A closer look, however, will reveal some significant evolutions in these containers as well as in the hard cases used to transport everything from weapons and electronics to medical supplies. Many of them have chemical agent resistant coatings on them. A growing number have electromagnetic interference (EMI)/radio frequency interfer-ence (RFI) protection to keep signals from emanating outside or coming into the con-tainer. Some have been cleverly engineered into energy-efficient shelters while others, through high-tech GPS tags, can be tracked and inventoried anywhere in the world.

As of May 2012, the Department of Defense owned 333,486 registered contain-ers, according to the Military Surface Deploy-ment and Distribution Command’s (SDDC) Global Container Management (GCM) branch. Between 7,000 and 10,000 of that total were added in the last five years. Just under half the total inventory is comprised of the 20-foot container, by far the most com-mon container in the system.

“The 20-foot container is number one because of its ease of use,” said Thomas Catchings, programs, systems and training lead for SDDC’s GCM branch. “It can be moved by a large or small element. You can stack them, you can put them on a truck. When we ship equipment overseas, once the 20-foot container gets there, it can be used for force protection, for storage and more. That kind of agility is what we’re looking for.”

GCM is currently working with other military organizations to create a compre-hensive, single-source solution for tracking

all containers in the DoD system through-out their life cycles, from procurement to disposal. “It will be a system for anyone in DoD to go into and have total visibility on a container—where it is, the maintenance cycle, the money owed on it,” said Catchings. “Today, we have different buckets for all that information with different people covering different lanes throughout the container life cycle.” Catchings expects funding for this program to begin flowing in fiscal year 2013.

The complexities of creating such a sys-tem are apparent when one considers the overwhelming number of variables in today’s container designs. Sea Box Inc., for instance, currently offers hundreds of designs and is adding three or four new ones every week in response to customer requests, said Sea Box President Jim Brennan.

While most of these designs are one-time custom builds, Brennan has observed several overarching trends, mostly related to the military’s efforts to go green. For instance, sandwich panel construction is increasingly popular. Unlike corrugated steel, sandwich paneling is built using multiple layers of foam, fiberglass and other insulating materi-als bonded together. “It’s equally as strong as corrugated, but it’s insulated,” said Brennan. “So you can get more insulation in the same amount of space [as corrugated], or you can get the same insulation in less space. You then use less energy and that’s the trend—moving toward more energy efficiency.”

A similar shift is occurring in the area of insulating paint, which uses thermally reflec-tive materials to reduce heat transfer through the coating, thereby reducing the energy needed to cool a container’s interior. Sea Box has offered this option for about five years but only recently has Brennan noticed an uptick in interest. “It’s been growing slowly because it’s expensive,” he said, “but people are start-ing to look more at their total energy life cycle costs and the reflective paint reduces those

costs over the long term.”In response to the U.S. Army’s efforts

to reduce energy usage housing soldiers in Afghanistan and elsewhere, Sea Box recently rolled out the Collapsible Re-deployable Shel-ter (CRS). The CRS is built from a shipping container with high-grade insulation in the walls and roof. It includes LED lighting and an electrical package, and it collapses to 2 feet in height for shipping. When four collapsed shelters are stacked, they are the same size and shape as a standard cargo container, mak-ing them easy to move via ship, truck and rail.

The Army recently finished six months of testing the CRS and other similar solutions at Fort Devens, Mass. Brennan anticipates the written results of that testing to be delivered in June. In the meantime, a major defense contractor just ordered a CRS complex with EMI shielding. “EMI-shielded collapsible shel-ters are brand new,” said Brennan, adding that the shelter will be complete by August.

“More customers are asking for EMI/RFI shielding and chem/bio features,” echoed Jason Raffaele, director of engineering at AAR Mobility Systems. “Our customers are put-ting more people and electronics in shelters deployed to austere environments, requiring ever-increasing cooling capacity and dehu-midification.”

AAR Mobility Systems traces its history of providing turn-key mobility and sustainment solutions to 1963 when it began manufac-turing aluminum cargo pallets for the U.S. Air Force. Today, it continues to support the defense marketplace via the prototype, design, manufacture, integration and life cycle sup-port of a wide variety of shelters, containers, CROPs and flat racks, pallets and palletized systems, and integrated platforms.

Beyond the growing number of requests for EMI/RFI shielding, Raffaele said the mili-tary is placing increased emphasis on weight and energy efficiency. “Lighter systems mean more payload and less fuel,” explained Mark

how packages, cases and shipping containers are evoLving in today’s agiLe, energy-conscious miLitary.

By heather BaLdwin

mLf correspondent


Pickett, marketing director for AAR Mobility Systems. “We are always looking for lighter weight, lower cost materials that support mis-sion requirements.” At the same time, AAR is working side by side with customers to address their growing desire for alternative energy and energy generation/storage in shelter systems. “We are collaborating with industry partners that complement our mobility platforms to leverage a strong integration experience” for green energy, Pickett said.

The push towards lighter weight and increased durability is affecting containers of all sizes. In response to a call from spe-cial operations and others for lighter cases, Cases2Go, a distributor of top quality ship-ping cases, and partner Dynamic Innovations created Carbon Armor cases, a line they rolled out in mid-2011. The cases leverage the unique characteristics of carbon fiber reinforced plastics, an advanced composite using continuous fiber in a thermoplastic matrix. Carbon Armor is half the weight of aluminum with six times aluminum’s tor-sion, tensile and strength. It is twice the strength of steel.

“When I look down the road, I don’t see anything replacing this technology,” said David Root, president of Cases2Go.

In addition to the growing demand for lighter weight, Root said his customers, like the customers of shipping container manu-facturers, are increasingly requesting EMI/RFI shielding on Cases2Go products. While it isn’t yet possible to integrate an effective EMI/RFI lining during the production of plastic or fiberglass, Cases2Go’s Carbon Armor cases offer an optional expanded metal mesh that is co-molded with the carbon fiber case wall to provide EMI/RFI shielding.

“Case design is in a constant state of move-ment with the evolution of technology,” Root observed. Today, cases are lighter, stronger and more technologically advanced than ever before. At the same time, they are shrinking. “There’s a trend toward smaller,” said Root. “Everything is compressing in size.”

Smaller size, unmatched durability and electronic equipment protection are the hall-marks of Pelican Products Inc.’s new Peli-can HardBack Series, cases made to protect devices such as laptops, tablets, e-readers and other small electronics. “We are target-ing digital survival with this series,” said Dan Klepacz, product manager, worldwide govern-ment market for Pelican, a leading manu-facturer of reusable transport cases for all environments. “The HardBack Series is travel armor for computing devices.”

Answering a call from cus-tomers for sleeker, more styl-ish products, Pelican worked in a design partnership with BMW DesignWorks to create the cases. They combine BMW’s design prowess with well-known Pelican features such as crush resistance, a watertight seal and an automatic pressure equalization valve that prevents vacuum lock, making the cases easier to open at any altitude. They also include anti-scratch foam inserts to protect delicate electronics.

As cases and containers get more technologically advanced and the equipment inside them becomes more advanced, the military is taking a harder look at how to keep track of everything. While many cases already include passive RFID tags, Klepacz said the past two years have seen growing demand for GPS and active RFID tags that can reveal case contents at a distance and/or enable a case owner to pinpoint the geographic location of his case.

In response, Pelican “is looking into this capability more, trying to figure out how to integrate it, investing more money in it and working with outside companies to figure out the best solutions,” said Klepacz. The capa-bilities of these advanced tags go far beyond inventory and location. “If there’s a shelf life to a part, you could tag it and it would send out a signal when it’s coming to its end of life,” explained Klepacz. “Or if you have weapons in storage, the tag could signal when there’s too much humidity. Or if you are transporting medical gear that is temperature sensitive, the tag can send a signal when interior tempera-tures are nearing their limits.” Advanced tags also can measure shock, vibration and other motion for sensitive electronic equipment.

In response to another military challenge, the problem of stacking cases of different sizes, Pelican last year launched its Inter-Stacking Pattern (ISP) Case. The system is compatible across six different case sizes, from 4 to 25 cubic feet of storage. “Normally, case ribs prevent containers of unlike size from stacking. We came up with a pattern that, no matter what size case, it will stack,” said Klepacz. Undercuts also make the case useful once it is deployed. For instance, a printer shipped in one of Pelican’s ISP cases can be removed at its final destination and the case

transformed into a table for the printer. This multi-use functionality cuts down on shipping requirements, ulti-mately saving the military on inventory and shipping costs.

“The business of military cases definitely has evolved with all the green initiatives,” said Klepacz. This year, Peli-can will roll out 45 new cases and lighting products, a sharp increase from the dozen or so it typically averages.

The military’s search for green shipping solutions goes all the way down to the pack-aging on the products it uses. Brian Koester, vice president of engineering for Advanced Military Packaging, a division of AD Inc., said last year he received a letter from TACOM that explained how the mili-

tary was going green and asking suppliers like AMP to evaluate the packing materials they are using.

“We can’t get entirely away from poly-mers,” said Koester, “but we are now trying to use more corrugated products.”

Koester explained that polymers such as polyethylene and polystyrene provide the best cushioning but don’t break down in land-fills. Corrugated products, though they break down in landfills and are effective in some cushioning applications, don’t rebound once compressed and so can’t entirely replace the environmentally-unfriendly polymers. Take an 80-pound hydraulic pump, for instance. “We have to put it in a vapor-proof bag, like a bag of potato chips,” he explained. “In the bag, we have to cushion the pump so it is protected from impact and at the same time won’t punc-ture the bag. We are trying to look for more corrugated solutions to accomplish this.”

Currently, Koester is examining a new corrugated product similar to cardboard but with a thin wood facing. “It would add extra strength and would be disposable,” said Koes-ter. If the material passes Koester’s evaluation, he will seek to get it TACOM approved, further boosting the command’s percent of green packing. O

For more information, contact Editor-in-Chief Jeff McKaughan at [email protected] or search our online archives for related stories

at www.mlf-kmi.com.

David Root

Dan Klepacz


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Q: In terms of the equipment that came out of Iraq, how much is still in Kuwait?

A: We started the big drawdown last year when the president [gave orders on] October 21, and we were done by December 18—about 58 days. During that time, we’ve been clearing out all that gear. Our last vehicle left on March 25, was loaded on the ship out of Kuwait and headed back to the States. We just made a video news clip of it being offloaded at the Port of Beaumont, Texas, and then transported to its final destination—the 1st Cavalry Museum at Fort Hood.

Of the total pieces, we moved well over 4,900 pieces of rolling stock, [which were] out of Kuwait in less than 100 days. We had some very great systems in line from the Army Materiel Command [AMC] and the Defense Logistics Agency [DLA], so we’re able to account for the items here in theater. Everything that came out of Iraq has been shipped to CONUS or incorporated into other stocks.

The job has been completed. As you know, during the first Gulf War, all that accounting was done back in CONUS, so pushing this capability forward allowed us greater efficiency and effectiveness in retrograding, redeploying or reposturing all U.S. property and equipment here.

Q: Geography is the biggest obvious difference between retrograde from Afghanistan versus that in Iraq. That being said, how will the system processes that were so successful coming out of Iraq and Kuwait work in the Afghanistan scenario?

A: We had a couple of ROC [rehearsal of concept] drills earlier this spring in which we highlighted the requirements for this draw-down effort and were able to take lessons learned and apply them to Afghanistan. As you know, Afghanistan is landlocked, and the PAKGLOC [Pakistan ground lines of communications] is closed right now.

Major General Kenneth S. Dowd is the com-mander of the 1st Sustainment Command (Theater).

He was commissioned through the ROTC pro-gram upon graduation from Cumberland College, Williamsburg, Ky., in 1979. His military education includes the Quartermaster Basic and Advanced Course, Logistics Executive Development Course,

U.S. Army Command and General Staff College, Armed Forces Staff Col-lege and the U.S. Army War College. In addition, he holds a master’s degree in logistics management from the Florida Institute of Technology.

Dowd has served in numerous command and staff positions through-out his career. His assignments include: commander, 299th Forward Sup-port Battalion, Schweinfurt, Germany (with operational deployment to Bosnia); chief, Logistics Operation Center, and DA DCSLOG, Washington, D.C.; commander of the 1st Armored Division Support Command (with combat deployment in support of Operation Iraqi Freedom); assistant deputy chief of staff for logistics, U.S. Army Europe, and the executive officer to the Army G4; director of logistics, engineering and security assis-tance, U.S. Pacific Command, Camp Smith, Hawaii; director for logistics, U.S. Central Command, MacDill Air Force Base, Fla., where he directed all logistics and engineering planning and operations in support of Operations Enduring Freedom and Iraqi Freedom. While there, he led the develop-ment and planning for the significant and historical logistics efforts that the 1st Sustainment Command (Theater).

Dowd’s awards and decorations include the Defense Superior Service Medal, Legion of Merit with one Oak Leaf Cluster, Defense Meritorious Service Medal, Meritorious Service Medal with four Oak Leaf Clusters, Army Commendation Medal with Silver Oak Leaf Cluster, and the Army Achievement medal with two Oak Leaf Clusters.

The 1st Sustainment Com-mand (Theater) was a focal point for the smooth retrograde of people and equipment from Iraq. That success and the lessons learned are being used as a model for plan-ning the Afghanistan drawdown. In the October 2011 issue of Mili-tary Logistics Forum, we had the chance to sit down with Major Gen-eral Kenneth Dowd and talk about the elements of the command that came together to get the job done. As Dowd prepares to leave 1TSC for his new job as the director of logistics operations for the Defense Logistics Agency, we wanted to do an exit interview of sorts to see where the command will go from here and how his experiences have prepared him for DLA.


We used a lot of things we developed in Iraq, like the RPAT [redis-tribution property accountability team] yards, where units can bring gear and turn it in, and the retro-sort yards, where they can turn in any kind of excess equipment. In Afghanistan, we have three different sites that are working with that same process.

We go through the sustainment brigades and inventory every-thing. If it’s serviceable, we put it back into the supply system. If it’s un-serviceable, we’ll go ahead and de-militarize it. Last month alone, at one of the turn-in sites they re-collected about $120 million worth of various items—and that was not equipment, but stuff that was turned in, tentage for example.

Units are starting to clear the battlefield and we’re starting the same process as in Iraq. We’re accounting for containers early on right now, and making sure the vehicles are clean and ready to move. We’re using the air piece to move the gear out of Afghanistan to places like Jordan. Then, we will ship it home from there.

Q: The basic processes that you put in place that work so well, up to the RPAT and up to the actual shipping of it—those systems are very similar to what was used in the Iraq scenario.

A: You’re exactly right, and the same types of property accountability, synchronizing movement of resources out of theater, force protec-tion measures, redistribution and transfer of excess equipment, and command partnerships. The only thing that’s a little harder is the process to move it because we have to use so much airlift capacity.

Q: Was 1TSC involved in working on the plans for preparing for that surge recovery and general retrograde?

A: Yes. We developed the plan in Iraq, but in Afghanistan, we had planners forward. Now we have part of my headquarters, the TSC Forward, pushed into Afghanistan. Its effort is to do that synchroni-zation of logistics to make sure we can continue to sustain the fight. But as the fighting season goes on, you start to retrograde gear out that’s excess, battle damaged, or stuff that can get out.

We moved part of my headquarters out of Kuwait into Afghani-stan to help synchronize the logistic goal retrograde efforts. The commitment and engagement with senior leaders in that theater is essential to the drawdown process.

Q: We last spoke toward the end of 2011. You made a point of talk-ing about the jointness of the command, 1TSC, to include civilians as well. Can you address that now as you’re looking back on the whole process and how it came together?

A: Yes. At any one time, we had about 18,000 folks within the com-mand—that included active, Reserve, sister service and civilians. So I actually had airmen, two companies that were driving trucks from Kuwait into Iraq, doing our truck driving because I had the short fall amount of trucks as there was so much demand for transportation.

I also used Navy customs teams to handle all of the agriculture inspections. I pushed about 24 of those experienced team members into Afghanistan, to get the customs clearance process started there.

The civilian contractors and AMC with their civilians have helped us do the processes and management of equipment—it’s a total team effort, and I refer to it as a “LOG Nation.” I don’t care what patch you wear; everyone’s trying to work it from a logistical standpoint in order to make it better for the warfighter.

The biggest takeaway is out of those 18,000 people, 66 percent were Reserve or National Guard. They were trained up in places like Camp Shelby and other places back in the States, and arrived here and became my transportation companies, my RPAT experts, customs teams, all those things—[they] just did an outstanding job.

Q: Can you tell me what the footprint looks like of 1TSC, where it’s located, and what you think that footprint will look like a year from now?

A: Right now, my headquarters is at Fort Bragg, and I have part of my command here in Kuwait. I have a smaller portion of my com-mand in Afghanistan that’s starting to build as we start to work the retrograde and other events.

In a year, I would look at just a little bigger footprint in Afghani-stan as we get into the retrograde and bring in other units to help us. Those are called the CMRE [CENTCOM Materiel Retrograde Effort], [and will] help us do the retrograde. I’ll still have a small footprint here in Kuwait.

At Fort Bragg, we’re going to take a hard look at developing some of our teams who helped train folks in CONUS, as units start to move back there on what logistic things we’ve worked through the war, just to keep our skills up. As you’ve seen, more units will probably be back in CONUS, and work those relationships with units and CONUS.

Q: What experiences at 1TSC have helped prepare you for your new role coming up with DLA?

A: I’ve been blessed as a solider: 33 years in the Army, the last five having been deployed—three years at CENTCOM and two years here at the 1st TSC. At CENTCOM, having to develop the plans for the surge into Iraq and the plus up in Afghanistan, and the withdrawal of forces out of Iraq and developing those plans and then coming into this command to execute those, has just been really outstanding. It’s allowed me to go to the DLA and work with those great Americans as we work the Afghanistan drawdown, be able to talk to those folks about the realities of what goes on over there and the fight, and how we can help from the DLA perspective to contribute to leverage our capabilities to support the warfighter.

Q: Is there anything you’d like to add about the men and women of 1TSC as you get ready to transition out?

A: I’ve worked with all these great folks over the last 22 months. I would just say we’ve got a tremendous military with these young men and women of all services. I sometimes think we forget that the real heroes have families that are back in CONUS who allow these warriors to come forward, be on point and do all this great work. I want to make sure we thank the families, because they’re going through stresses and separations just as these young men and women in combat are going through. I often think we don’t say thank you enough to them, because they’re a part of this big team also. O


at www.mlf-kmi.com.


As a primary level field activity of the Defense Logistics Agency, DLA Energy is the agency’s fuel supplier, providing the Department of Defense and other government agencies with comprehensive energy solutions in the most effective and efficient manner possible. DLA Energy provides a host of ground, marine and aviation fuels as well as space and missile propellants, chemicals and gases, utility fuels and electricity. In addition, DLA Energy is the DoD’s center of expertise for alternative fuels and renewable energy and serves as the executive agent for DoD’s bulk petroleum supply chain.

DLA Energy bought the equivalent of approximately 144 million barrels of fuel, energy and power, worth about $20 billion in the last fiscal year. That total included petroleum products for aircraft and ships; diesel fuel and gasoline for vehicles; heating oil, natural gas, coal and electricity for installations; aerospace fuels and products for the National Aeronautics and Space Administration (NASA), DoD, and the commercial space launch programs; and small quantities of alternative fuels for the military services’ testing and certification programs.

Although the military services are occasionally granted local pur-chase authority to buy fuels in unique circumstances, DLA Energy buys more than 99 percent of fuels used by the U.S. military. “By purchas-ing our customer’s requirements in aggregate we get buying power,” explained Director of Supplier Operations Mark Iden. “Rather than having each military service buy its own fuel requirements indepen-dently with its own acquisition office and service-specific contracting methods, we provide the overall DoD purchasing leverage, do it in a consistent manner, and generally issue solicitations for our recurring buys on set schedules that industry has grown accustomed to over the years.”

Iden noted that “for the bulk petroleum products, we generally buy the products from the producers and manage the supply chain end to end.” DLA Energy does not own the assets that distribute these petroleum products throughout the supply chain. DLA Energy arranges transportation via U.S. Transportation Command activities, the Military Sealift Command and the Military Surface Deployment and Distribution Command. But DLA Energy is responsible for ensur-ing the on-time delivery of these products to their end-use customers. Iden also noted that DLA Energy owns the bulk fuel products generally up to the point of sale to their customer, which typically takes place at the wing of the aircraft or into the piece of equipment being refueled.

Tied in with this fuel-ownership role is DLA Energy’s responsibility to fund the sustainment, restoration and modernization requirements for the military services’ fuel storage and distribution systems that contain this DLA-owned fuel.

For bulk purchases of conventional fuels like JP8 aviation turbine fuel, JP5 naval aviation turbine fuel and F76 ship propulsion fuel, DLA Energy obtains requirements from their customers and then puts out a request for proposal, explained Research and Development Strategic Energy Analyst Jeanne Binder. “Our bulk petroleum business unit then receives the bids and evaluates them, seeking the lowest total cost to the government,” Binder said. Then an indefinite delivery/indefinite quantity award is made for a one-year delivery period, with an estimated quantity and a guaranteed lift of 75 percent of this volume. The initial price is adjusted weekly or even daily based on changes in commercial fuel indexes.

Other purchases of conventional fuels, for example of the diesel fuel, gasoline or heating oil handled by DLA Energy’s Direct Delivery Fuels business unit, are conducted in a similar fashion, except that these can result in multi-year requirements contracts with up to five-year delivery periods. All RFPs are posted on the Federal Business Opportu-nities website. The vast majority of purchases, for both bulk petroleum products and for the direct delivery products, are competitive, and all acquisitions comply with both Federal Acquisition Regulations and Defense Federal Acquisition Regulation Supplement, noted Iden.

DLA Energy bulk fuel purchases are also subject to small business set-aside rules. DLA Energy is currently working with the Small Busi-ness Administration to consider an increase in the size definition of small refineries. “Over the years, the number of small refineries has diminished as these refineries have been bought out or have merged or consolidated with other firms, thereby losing their current small business status,” Iden explained. “A revised small refinery size determi-nation could help us increase the number of potential small business participants in our key bulk petroleum acquisition programs.”

DLA Energy is also actively engaged with the military services in support of their current efforts to test and certify a number of new alternative fuels. Binder said the major difference for purchases of the new brand of alternative fuels is that these are generally for a small quantity specifically requested by the military services for testing and certification purposes. The quantities requested range from a couple

By henry canaday

mLf correspondent

fueL By the BiLLions of gaLLons.


hundred to a couple hundred thousand gallons, compared with more than 4 billion gallons for the bulk fuel purchase programs. However, the one-time buys of alternative fuels are still competitively bid on by several alternative fuel suppliers.

Iden said DLA Energy plans to stick with its basic fuel procurement processes as the alternative fuel program matures into larger acquisi-tion volumes. “It is tried and true, industry is comfortable with it, and they know when the RFPs for our recurring acquisition programs will come out.” However, one possible change in DLA Energy’s bulk petroleum acquisition programs is a shift toward more commercial-specification type fuels. “Instead of military specification JP8, we may see a move to the Jet A commercial specification fuel used by the air-lines,” Iden noted. “We are in the beginning phases of this conversion. It is not fully approved, but we are beginning the necessary steps in that direction. Using a commercial specification fuel may make it easier for refiners to supply us and may broaden our potential supplier base.”

All alternative fuels approved as a replacement for military speci-fication fuel for military use will be drop-ins, and will be blended with conventional fuels, thus having the same performance characteristics as the straight conventional fuels. So far, the Air Force has an updated military specification for JP8 blended with coal, natural gas or biomass converted to liquid by the Fischer–Tropsch (FT) process, Binder noted. Original prices for purchases of the FT product ranged from $4 to $7 per gallon.

The Navy and Army are working on their FT certification, and the services are also testing hydrotreated renewable fuels, with completion expected next year. “They are also starting on sugar to hydrocarbons,” Binder noted. For operational buys, in contrast to testing and certifica-tion, the price of alternative fuels will also be important. “Prices are going down,” Binder observed. For the latest purchase of 350,000 gal-lons of biofuel l for the Navy, the price was $26 per gallon.

“When we started purchasing biofuels three years ago, the price was in the mid-$60 per gallon range,” Iden said. “Recently, we have seen the price drop by a factor of two or three for our more recent contracts.”

The next step in gaining economy of scale for alternative fuels will come with larger purchases in the range of millions of gallons. “It’s a chicken-and-egg thing,” Iden said. “You must have volumes to lower cost. But to ramp up to the larger volumes, it will take time for the costs to come down.”

DLA Energy’s purchases of alternative fuels will be set by customer requirements. The Navy has set a goal of 50 percent of its fuel coming from blends of alternative fuels by 2020, and the Air Force wants the same portion for its domestic fuels by 2016. DLA Energy has calcu-lated that these goals translate into 387 million gallons of alternatives blended into JP8 and 336 million gallons blended into JP5 and F76.

Iden emphasized that these are still just goals and objectives. “The assumption is alternatives will be competitive in price with conven-tional fuels by time we buy them for operational requirements.”

Private companies play a very important role in getting fuel to DLA Energy and to the field where these fuels are needed. For example, the Supreme Group supplies primarily jet fuel to DLA, according to John Segleski, managing director for fuels. Volumes vary month by month, but are typically between 4 to 10 million gallons each month. Segleski said Supreme delivers this fuel to a range of locations across Afghanistan.

“Supreme has been operating in challenging environments for more than 50 years, and has been providing services in Afghanistan for over 10 years,” Segleski stressed. “Supreme made a commer-cial decision to establish regional distribution centers to facilitate

improvements in supply chain performance and has developed excel-lent infrastructure and storage facilities close to point of consumption on military bases, thereby reducing risk and enhancing service to the warfighter.” The company operates a robust supply chain, with multiple sources, multiple suppliers, multiple entry points and multiple local partners. “Supreme has the capability to move large volumes in what is a long, 90-day, supply chain.”

Solazyme is working with DLA Energy and the U.S. Navy in fuel certification for the scale-up in renewable oil technology, said Bob Ames, vice president of Fuels Commercialization.

To date, Solazyme has delivered what it believes to be the largest quantities of microbially-derived advanced biofuels in history, including over 600,000 liters of in-specification jet fuel and marine diesel to the Navy. “Since 2008, we have had several contracts with DLA Energy to deliver to the Navy increasingly larger quantities of algae-derived fuels,” Ames said.

In 2009, Solazyme contracted with DLA Energy to provide over 80,000 liters of algae-derived renewable F76 marine diesel fuel to the Navy. A second 2009 contract was for production of algae-derived renewable JP5 naval jet fuel. In 2010, Solazyme entered into a third contract to produce up to 566,000 liters of renewable F76 fuel. The Navy funded the contract option for purchase of 283,000 liters, which the company anticipates producing through the second half of 2012. “We believe that our performance of this third contract progresses the completion of the technical testing and certification program for our algae-derived fuel,” Ames said.

Solazyme’s algae-derived fuels have been successfully tested in multiple Navy vessels. Its algae-derived jet fuel was tested successfully in May 2011 in a MH-60S Seahawk helicopter test flight using the fuel in a 50 percent blend with petroleum-derived jet fuel. This Seahawk flight was the first-ever military aircraft to fly on an algae-based jet fuel.

The Navy also tested Solazyme’s marine distillate fuel in a destroyer over a 20-hour voyage up the California coastline. A biofuel speed record was set by the Navy when testing Solazyme fuel in a landing craft util-ity vehicle. The Navy has also supplied Solazyme’s algae-derived diesel to Maersk Shipping Line, which tested the fuel in a 300-meter Maersk Kalmar container vessel over a one-month, 6,500-nautical mile voyage. Solazyme fuel was also successfully tested in a Navy frigate, USS Ford.

Solazyme agreed in December 2011 to supply 10 percent of the total feedstock required under a Navy contract for 100,000 gallons of renewable jet fuel and 350,000 gallons of renewable marine diesel. This new contract will be fulfilled by Solazyme in conjunction with Dynamic Fuels and represents the single largest purchase of biofuel in government history. The fuel will be used as part of the Navy’s efforts to develop a Green Strike Group composed of vessels and ships powered by advanced biofuel.

The company is now taking steps toward supplying commercial quantities of tactical fuels, renewable JP5 and F76 to DLA and the Navy for operational use.

Ames said fuels refined from Solazyme’s oil offer superior envi-ronmental benefits when compared to a majority of other biofuels. Life cycle greenhouse-gas emissions are reduced by a minimum of 66 percent when used for road transportation, as determined by Life Cycle Associates, an independent carbon intensity measurement firm. O


at www.mlf-kmi.com.


SUPPLY CHAIN

Ammunition Deliveries

ATK has received orders totaling more than $266 million for small caliber ammu-nition under an indefinite delivery/indefi-nite quantity (IDIQ) contract with the U.S. Army Contracting Command, Rock Island. This order includes a mix of 5.56 mm, 7.62 mm and .50-caliber military ammuni-tion to be produced at the Lake City Army Ammunition Plant in Independence, Mo. ATK has operated the Lake City plant since April 2000.

“ATK is honored to be the Army’s industrial partner at the Lake City Army Ammunition Plant, collaborating in the operation and maintenance of the nation’s largest ammunition production facility,”

said ATK Small Caliber Systems Vice President and General Manager Kent Holiday. “Since 2000, we have delivered more than 11 billion rounds of ammunition in support of our nation’s warfighters while modernizing the facility, increasing capacity, improving productivity and efficiency, and doing so in a safe and responsible manner.”

The Army and ATK are nearing comple-tion of a $276 million modernization project at the Lake City facility. This includes the capacity to increase production of the new 5.56 mm Enhanced Performance Round. ATK has delivered approximately 250 million of these rounds since transitioning to production in 2010.

Body Armor

Point Blank Enterprises Inc., a leader in the production of soft body armor and related protective solutions, announced that it has been awarded a firm-fixed-price contract from the Defense Logistics Agency (DLA) to provide improved outer tactical vest and outer tactical vest components to support U.S. Army and U.S. Air Force personnel. This contract has a maximum value of $119.9 million and the company expects the first year’s value to be approximately $50 million with three one-year option awards thereafter.

Commenting on this latest award, Jim Henderson, chief executive officer, stated, “We continue to receive large volume orders from the U.S. military and government given our past proven performance, our ability to produce high volume quality products on time, and for our never-ending commitment to innovation and safety. We are proud to be a chosen supplier to the U.S. government and it’s with great pride that we continue to produce life-saving products for America’s servicemen and women.”

Last C-5 AMP Delivered

Lockheed Martin completed delivery of the 79th and final C-5 Galaxy aircraft of the current Avionics Modernization Program at a ceremony at Travis Air Force Base, Calif., on April 27.

“We are very proud of our AMP team,” said Greg Ulmer, vice president of the C-5 program. “This delivery continues the ever-growing legacy of the C-5 Galaxy and the critical role it plays in

supporting the warfighter across the globe for many years to come.”

Aircraft 70-448 will be assigned to the Air Force Reserve 433rd Airlift Wing at Lackland AFB in San Antonio.

The AMP program is the first part of a two-step modernization process. AMP began in 1998 and incor-porates a mission computer, a glass cockpit with digital avionics, autopilot capa-bilities and state-of-the-art

communications, navigation and surveillance components for air traffic management.

The second phase of the C-5 modernization effort is the Reliability Enhancement and Re-Engining Program. Of the 79 C-5s that received the AMP modifications, 52 will be upgraded with newer, quieter CF-6 engines and more than 70 additional improvements as part of the transition to becoming a C-5M Super Galaxy.



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Vice Admiral Mark D. Harnitchek became director of the Defense Logistics Agency in November 2011. As such, he is responsible for providing the Army, Navy, Air Force, Marine Corps and other federal agencies with a variety of logistics, acquisition and technical services in peace and war. These services include logistics information, materiel management, procurement, warehousing and distribution of spare parts, food, clothing, medical supplies and fuel, reutilization of surplus mili-tary materiel and document automation and production. This worldwide mission is performed by nearly 27,000 civilian and military personnel.

He previously served as deputy commander, U.S. Transporta-tion Command, Scott Air Force Base, Ill.

Harnitchek, a native of Philadelphia, received a Bachelor of Arts degree from Penn State University in 1977 and was commis-sioned through the Navy ROTC program. In 1987, he received a master’s degree in management from the Naval Postgraduate School, Monterey, Calif.

Harnitchek has served in a variety of sea tours including two submarines, USS Will Rogers (SSBN 659) and USS Buffalo (SSN-715); two ships, USS Holland (AS-32) and USS Proteus (AS-19); and the aircraft carrier USS Theodore Roosevelt (CVN-71). His shore tours include commander, Submarine Group 7, Yokosuka, Japan; the Navy Ships Parts Control Center, Naval Air Station Oceana, Va.; and the Chief of Naval Operations Staff.

Flag assignments include commanding officer, Naval Inven-tory Control Point; vice director for logistics, the Joint Staff; Director, Strategy, Policy, Programs and Logistics, USTRANS-COM; and director, U.S. Central Command Deployment and Distribution Operations Center in operations Iraqi and Endur-ing Freedom.

Q: Now that you’ve been in the slot there for about six months, what are your impressions of the agency and the workforce?

A: First and foremost, I’m again reminded of the professionalism of our civilian workforce. Since I left the Navy I’m out of the big end item logistics business, but what struck me back then in

my days as NAVICP commander was how the military logistics system really relies on our dedicated civilians, led by our military folks. That’s maybe not an impression, but coming from TRANS-COM and a higher ratio of military on the team, it’s a pleasant reminder of what it’s also like working big DoD logistics issues with a strong civilian workforce.

And speaking of big, the other thing that strikes me about DLA is how large its mission is. I’d been a customer of DLA for probably 30 years before I got here and I knew they were big, but I just never had a sense of how big. We’re operating in 28 countries and 48 states with about 27,000 people, 26 depots, supporting eight supply chains. The dollar value of our sales is about a $46 billion enterprise, of which more than $5 billion is for the cost of operations, people, infrastructure and information technology and about $40 billion or so is the actual cost of the materiel.

What also strikes me is how a significant portion of our total sales is for fuel—it’s about half. And the other two big ones are food, at about $5 billion, and pharmaceuticals, which are about another $5 billion. Another big impression I have of DLA is that it’s not the DLA I grew up with as a customer. In my 35-year career, DLA has largely been a wholesaler. But now, due to BRAC and mis-sion growth, we’re doing things like retail inventory management

Vice Admiral Mark D. HarnitchekDirector


Supply Chain ProviderManaging the Global Supply Chain Efficiently and Effectively

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and support at service industrial sites. We also do a service, sort of a Title 10 function, where we’re buying service managed depot-level reparables.

The other significant issue is battlespace support for food and fuel. DLA is the executive agent for both of those commodities, which means you have responsibilities from end to end—from procurement to distribution for forces in Afghanistan, and in Iraq for the State Department. Our contracts, written out of DLA Troop Support for food and DLA Energy for fuel, include not only the sourcing of the fuel but the tactical distribution of it, and in Afghanistan that’s battlefield logistics. And again, this is a much different DLA in terms of what it is we do now—mission and scope—than I remember as a youngster coming up. DLA’s involve-ment starts from the oil coming out of the ground until it’s getting burned in the machines in Afghanistan. So I’d say that’s probably my biggest impression, along with the quality of the workforce.

Q: I understand you updated the director’s guide. Can you share with me the key elements of that?

A: My predecessor, Vice Admiral Thompson, had a great product in terms of his 2012 director’s guidance. The last thing I wanted to do was to change course strategically in the beginning of the fiscal year when Admiral Thompson and the agency overall had just worked so hard to set that guidance forth last fall. All I did was expand on it a little bit. So it really hasn’t changed, rather I’ve built on an outstanding document from my predecessor. With that great foundation, the big categories have stayed the same: warfighter support, stewardship excellence and workforce development. But what you’ll see is I’ve added some very concrete numerical goals and metrics so everybody knows the direction we’re going and where I am holding them accountable to execute. The nice thing about being in the logistics business is everything’s inherently measurable. Really, the challenge is not creating the metrics, but picking the right ones and getting the big ship headed that way. The goals are fairly aggressive. My theme for both the guidance and our program budget review 2014 is to significantly improve support to our customers and dramatically take cost out of the enterprise. We’re setting the bar high, but I think we have a great team here at DLA, and they’re going to help me think big, make big decisions, prioritize and get it done.

Q: With that as a foundation, is it possible to separate out some of the major strategic objectives that you want to hit the mark on over the next two-three years?

A: Right now we have two big things. First, the new defense strategy that the president announced in January, which of course works its way down to folks who execute logistics. And two years ago the chairman published the joint operating environment and capstone document for joint operations. So, using those as our strategic guidance as well as the budget reality DoD is facing, we know DoD is expected to reduce the budget by about $500 billion in the next 10 years. So again, my two strategic objectives here are to deliver significant and sustainable efficiency improvements above and beyond those cost reductions that I think will naturally occur as a result of reduced op tempo, while we at the same time significantly improve customer service levels.

DoD initially charged DLA to save about $4 billion by fiscal year 2018 and we’ve become a little more aggressive and upped that goal to about $10 billion. What that translates to for my folks is about $2 billion out of operating costs, and about $8 billion in product costs across all of the supply chains that we are respon-sible for here at DLA. We’re calling this 10 and five: $10 billion in five years. So we’ll get there in 2 percent increments every year until we get to 10 percent in FY18. The notion on the operating side is to pass these savings along to the services, so we cost less in terms of our cost recovery rate and the actual cost of materiel will be less. Again, our intent is to pass those savings on to the customer, and we have a strategy to get there, which I can talk about in very general terms.

One of them is this culture of judiciousness. That’s not a term I coined, but one that I got from the Chief of Naval Operations at our last flag officer conference. It means that when we’re spend-ing money we really need to think constantly about how much is enough. If it was my money, would I spend it that way? The point is to be very mindful of the responsibility that we as logisticians have in helping the nation with the deficit problem. I think if everybody pulls on the rope the same way—and you’ve got 27,000 DLA pro-fessionals doing that—we’re going to have some great success.

We’re also doing something here called strategic network optimization. That’s the notion of where do we position inventory, how much do we position, does the infrastructure meet the mis-sion. Essentially, you don’t want to have more of anything than you have requirements for, and trim away excess so you can better employ the resources that you have now. The objective is to have less but much harder working inventory strategically positioned to meet our war fighting outcome, regardless of what that is, and with a whole lot less infrastructure.

On the acquisition side, DLA was a pioneer back in the ’90s for things like subsistence and pharmaceutical prime vendor, but we decided fundamentally to get out of that business and ride the coattails of a great big commercial environment that does essen-tially the same thing. I think for DLA there are still a couple of new frontiers on that front that we’re going to take a look at. We’re going to use tools like a reverse auction, instead of a low price or best and final offer that the competitors don’t see. So if you’ve seen an online auction on a site like eBay, where folks who want some-thing bid against one another and the highest bid wins, a reverse auction is exactly the opposite, where competitors who respond to a DLA solicitation issue bids against one another for that business. We’ve already had some great success with this within DLA, and in my service experience back in the Navy we would save on average about 20 percent over the last time we bought that item. Some were less, some were more, but on average, savings are in the 20s, so we see an advantage there.

I think we need an improved strategy on EMALL. We’ve seen our sales decrease by 25 percent in the DoD EMALL over time, and I’m not sure if that’s the result of any strategic direction, so we’re going to take another look at it. We think that in the 21st century and with all the technology we can leverage, there’s great opportunity to have public competition on the Internet and where appropriate get out of the business of buying, storing and distrib-uting things the way commercial industry does.

We’re also going to take another run at long-term contracts. In my service experience, they are generally for five years or

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more. In my time here with DLA, they’re less than that. But I think what I’ve learned over time is if you want to really incentiv-ize good behavior, better price and a strategic relationship, you don’t do that a year at a time, you do that with much longer term contracts. Of course, there’s one focus that we talk about all the time but have trouble executing: this notion of really shorten-ing the amount of time it takes us to both write the contract and then get the materiel. So again, the old notion that time is money means shorter times are better than longer times.

As a result of BRAC we received several service-specific functions in support of the industrial missions for each of the services. The intent of the legislation was to really leverage the DLA enterprise to improve effectiveness at those service indus-trial sites and then get more efficient on the back end. The tough part for DLA is that we are now not only a wholesaler, we’re also a retailer. This requires thinking quite a bit differently about our business; we need to have different business processes in place so we’re not only delighting customers at the wholesale level, we’re getting the right materiel to the right industrial production site so artisans aren’t waiting for a part. I think there’s great oppor-tunity for us here as well.

This year we’ve included energy as part of our savings base. That’s something traditionally DLA has not done before, but again, the numbers are so big we had to include them as part of our efforts to find new savings and efficiency opportunities.

Excellence in overall inventory management is another area we’re focused on improving. After many years into our Business Systems Modernization program, we’re going to take stock of this successful project everyone here at DLA is proud of and see if it is in fact delivering the sort of performance it had promised in terms of inventory turn and inventory investment. Are we buying the right inventory, are we buying the right range, are we buying the right depth, etc. And where we need to take a turn to make it better, we’ll do that. For the amount of money we’ve spent on inventory, I think there’s some improvement we can make in terms of our investment. The notion is to do better ensuring that for every dollar’s worth of inventory we buy, we sell that dollar as opposed to just holding some of it for a long time.

Finally, the Secretary of Defense has given the department very specific guidance on audit readiness. This means asking, are we good stewards of the taxpayer’s money? Are we making the right investment decisions? Can we support the decisions we’ve made with written procedures and the proper IT, etc. I think we’re going to find some areas where perhaps we’re not as tight as we need to be in terms of efficiency, so this is another oppor-tunity to drive some inefficiency and waste out of our operations.

We have some fairly aggressive goals here, the 10 in five for example, and I think we have a whole host of strategies to get there. Some will work and some won’t, but where they don’t work, we’ll try something else.

Q: I understand you’ve initiated a program called Captains of Industry Days. Can you tell me the genesis of that, what you’re getting out of it and what you hope to get out of it in the future?

A: This is something that I have some experience with from my Navy days, and then most recently during my tour at TRANSCOM, where every quarter we would meet with our sea lift and air lift

partners to talk about the strategic relationship: where we saw operations going, are we organized contractually and strategi-cally the best we need to be, are there issues confronting us or that are just over the horizon which need to be addressed so we can execute our mission efficiently. We addressed a whole host of issues which were appropriate for three-stars and chief operating officers and chief executive officers to discuss, all with the goal in mind that we would do right by the taxpayer, do right by private industry, and do right by the warfighter who we all support.

They were very focused, very outcome-oriented meetings, where we decided what we were going to go do and then held ourselves accountable to go do it. I’d like to start the same thing here at DLA. We’ve done this with our food services providers already, and as I indicated, it’s about a $5 billion business. I’ve asked each of my supply chains to save about 10 percent over the next five years and of course most of that is in the cost of materials, so who better to discuss this with than our providers? For example, when we had our food providers here, I asked them directly: We’re under a lot of budget pressure and have been ordered to save about $4 billion in the next five years, and there could be more coming. Help me figure out from a partnership perspective how to best meet this goal. And of course, they had lots of great ideas on things we need to do in order for them to help us hit 10 percent.

What you find over time is that a lot of things we ask our industry partners to do, especially where we’re riding a commer-cial supply chain, can cause them to charge us more money. So we, by virtue very often of what we ask them to do, unknowingly induce a lot of waste and inefficiencies and cost in the process. So who better to talk to in order to save 10 percent than your business partners? We’re very frank, very open and very out-come-oriented. When you read the secretary’s defense planning guidance, everybody in industry is understandably nervous about the budget cuts on the horizon, so the secretary’s guidance is to talk to industry and that’s exactly what we’re doing.

Q: You mentioned that industry is a big partner in this. Some-times DoD, DLA, and the defense industry may get in their own way with their decision-making process; it’s not doing business the same way that commercial industry would do it. Are there other ways that you’re trying to be innovative with the way you deal with industry partners and perhaps become more in line with the way they do business in the commercial sector?

A: Certainly. First and foremost we’re going to be effective, but we need to be very mindful of cost. You can talk about this in terms of acquisition reform and that spans a whole array of things we need to do. A lot of it is on our end, just improving our processes, being good stewards, trusting one another at the strategic level. If you’re not going forward with this in concert with your partners then you really haven’t reformed anything. Reform must be done on both ends of the supplier-customer spectrum. I can tell you from a DLA perspective that’s exactly what we’re going to do.

I talked some about the notion of reverse auctions and long-term relationships, which are just very focused efforts to get more out of our acquisition dollars while offering a fair profit to our industrial customers and suppliers. It’s a win for everyone,



but you must have incentives aligned and you’ve got to talk to people at both the operational and leadership levels. Generally, achieving whatever operational effect you’re trying to meet and doing so at the least cost to the taxpayer is what you’re looking to do. If that’s the mission, how do you best do that? As I discussed earlier, how do you work with industry to get the best solutions? Do you do that with a long-term agreement or with more com-petition? Do you do that with a fixed price contract, with a cost contract? Do you do that with multi-service contracting? I don’t know the answer in every case, but the solution is certainly not one size fits all.

Q: Talking about some of those bigger issues, what do you see as DLA’s biggest challenges that it will face in the next two years?

A: Back to our savings targets, we don’t have the real aggressive percentages until much later in the future years defense pro-gram, but what’s critical for us is to start hitting some homers in the very near future so we’re actually exceeding our goals in ’14 rather than coming up short. Getting these big things right initially will be critical for us. Time is the only thing you can’t buy back, so for lack of a better term I will tell you that we’re on the clock with regards to hitting these savings targets quickly. That’s a big deal for us.

The other big thing we’re going to be most challenged by is whether or not DLA is ready to respond to joint force command-ers and ensure they have the freedom of action that is talked about in joint pub 4-0. Are we ready—not are we ready with parts, but is the system ready? Is our fuel system ready, our class nine system ready, and our distribution system ready to support operations in very dispersed locales, in very inhospitable envi-ronments? Are we ready to operate like we are in Afghanistan, across a very uncertain and fragile transportation network? Is DLA ready to respond in an area where we can’t use a military footprint; where we have to rely on a commercial supply chain exclusively and where we have to rely on uncertain partners; where our lines of communication are unsecured or uncertain?

Probably the final challenge is the persistent cyber-attack on our logistics network. When you’re a logistician, you move two things: the stuff and then of course information about the stuff. One of the big things we learned back in the ’90s was that it wasn’t enough just to move supplies, because if you’re not moving the information at the same time you’ll end up with a mountain of equipment. The bottom line is that the flow of information is just as vital as the physical movement of equip-ment and supplies.

Of course the other challenges are continuing to support operations in Afghanistan with our two big supply chains, class one and class three, making sure that as fast as the off-ramp happens in Afghanistan, from a disposition perspective, we’re ready to support the services and CENTCOM with regard to gear they no longer need. We’re very mindful of how we conduct the disposition of that materiel.

So again, lots of things going on at DLA, but we’re an orga-nization with a lot of very dedicated folks, great teammates in the COCOMs and the services, and we’re really optimistic and enthusiastic about the challenges that are ahead.

Q: You’ve spoken recently about the need to think critically. Can you tell me what that means and how you can use that as a foundation to train and educate logisticians now and in the future?

A: One of the things I’ve learned is that the ability to think critically is a skill I value most in leaders and folks who work for me. And you don’t necessarily need to be a logistician to be able to think critically, but if you have a logistician that can think critically, all the better. Critical thinkers are folks who are able to look at a logistics problem and distill it down to its essence: What are the three to five big things we need to do in order to solve this logistics problem? I’ll tell you a sea story here: When I was the J-5 and then the deputy of transcom, one of the chal-lenges in 2009 was determining what we needed to do to open up a route into Afghanistan from the north. Our four-star at the time, General McNabb, said, ‘Well, it’s really pretty simple. You need to do two big things: You need to get the permission of about 15 nations, and you need to get a transportation network set up.’ And he was right, that’s all we needed to do. And from the four-star and three-star perspective, being able to think critically is focusing on those two big things. That was his guidance and it was up to the staff to operationalize it.

So that’s my sense of critical thinking—it’s the ability to look at a logistics problem and distill the problem down to its essence in terms of what it is you need to do in order to achieve the operational outcome you want. My message to the workforce is to do smart things; don’t wait for somebody to tell you what the requirement is or for somebody to ask, because if you wait you’re probably too late. I tell my folks that nobody knows the DLA busi-ness like we do, so I expect them to go out and do great things, to prioritize, make decisions, do it your own way, but get it done.

This is not just the DLA director’s guidance, this is what we’re hearing from our nation’s leadership and leadership in the department, so to that extent we all need to think about transfor-mative change. The department is requiring it from us, and that’s what we’re going to go do.

Q: Is there anything you’d like to add about the mission, the organization, and the men and women of the DLA?

A: I think the message needs to be very consistent about what it is we’re going to go do and how we’re going to go do it. We are first and foremost always effective, but we’re also always mindful about how much things cost. We’re going to do right by the warf-ighter, right by the taxpayer, and do right by our people. They are the three big focus areas for us, so as long as we keep that very clear in mind, I think we’ll be great.

It’s a real thrill after 30-plus years to be the director of this fabulous organization, and an honor to continue the work that I’ve done over the past couple of years with all the great logisti-cians in the department, the services, the combatant command-ers, and frankly across the interagency as well. I want every DLA customer to know that when they buy something from DLA, they’re not just getting a product or thing, they’re getting the best-value solution that exists. It’s just a great honor to be the director of this wonderful, now 50-year-old organization, to build on what’s come before and help it be even better. O



Vice Adm. Mark D. Harnitchek, SC, USN

Director

Rear Adm. David F. Baucom, USN

CommanderDLA Troop Support

Brig. Gen. Scott W. Jansson, USAF

CommanderDLA Aviation

David RodriguezDirector

DLA Installation Support

Brad B. BunnDirector

DLA Human Resources (J1)

Col. Joe E. Arnold Jr., USA CommanderDLA Pacific

Redding HobbyActing Director

DLA Logistics Operations (J3)

Col. Joseph E. Ladner IV, USACommander

DLA Europe and Africa

Col. Jan K. DeMartini, USA Director

DLA Office of Inspector General

Col. Michael C. Bird, USACommanderDLA Central

Amy SajdaDirector

DLA Small Business (DB)

cOMMANDERS & DIREcTORS

cORPORATE STAFF


Command Sgt. Maj. Otis Cuffee, USA

Senior Enlisted Leader

Fred BaillieChief of Staff

Edward J. Case Vice Director

Kathy CutlerDirector

DLA Information Operations (J6)

Deborah L. GregerDirector

DLA Logistics Information Services

Brig. Gen. Darrell K. Williams, USA

CommanderDLA Land and Maritime

Fred T. PribbleDLA General Counsel (DG)

Stephen T. ShermanDirector

DLA Document Services

Rear Adm. Thomas C. Traaen SC, USN

CommanderDLA Distribution

J. Anthony PoleoDLA Chief Financial

Officer (J8)

Patrick J. DulinActing Commander

DLA Energy

Nancy M. HeimbaughDirector

DLA Acquisition (J7)

Ronnie FavorsAdministrator

DLA Strategic Materials

Twila C. GonzalesDirector

DLA Disposition Services

Rear Adm. Patricia E. Wolfe, USN Director Joint Reserve

Force (J9)

Rear Adm. Ron J. MacLaren, USN

DirectorJoint Contingency

Acquisition Support Office


Q: Can we start with an overview of your office size and the amount of work that processes through the DLA Small Business Office daily?

A: DLA has approximately 63 small business specialists located throughout the organiza-tion, supporting the contracting officers who issue the solicitations and awards. DLA aver-ages about 11,000 total contract awards each day and has about a million individual contract actions per year. The small business specialists advocate for small businesses in each of the acquisitions they review.

Q: What is the total revenue awarded on an annual basis through small business?

A: Last year we issued a total of $6.9 billion in contract awards to small businesses. That was out of $22.7 billion eligible for small business awards.

Q: Where are the biggest portions of small business awards made?

A: We do a fairly robust business with our distribution mission, because this includes a lot of commercial items. It is easiest to find a small business source in the industrial base for commercial items.

Q: Do you have branch or satellite offices?

A: In addition to my office, we have nine satellite offices located in DLA field activities worldwide.

Q: Does DLA have goals as to how much of its business should go to small businesses? Do these goals differ by procurement area?

A: The statutory goal for all the federal govern-ment is 23 percent of purchases. Each year, the Small Business Administration negotiates a goal for each department. This year the Department of Defense goal is 22.5 percent of purchases. DLA’s share is 33.5 percent, based on the com-modities that we buy. We have one of the highest goals because of the high volume of commercial products we buy on behalf of America’s military services. These goals are stretch goals. It is up to each agency to see what they can do.

Q: Is there a simple definition of small business?

A: The Small Business Administration estab-lishes the size definition of a small business by NAICS [North American Industrial Classifica-tion System] code. You can find the link to the size definition for your NAICS code on the DLA small business webpage. Size standards differ by industry.

Q: Does your office only manage the contracts of small business awards or do you offer other services to existing and potential small busi-ness that are doing or want to do business with DLA?

A: My office does not manage contracts or solicit, evaluate or sign contracts. We support the buyers and the contracting officers in the solicitations and evaluations they make. We advocate for small businesses in the contracting process. We look for additional sources of small business supply, and we advise the acquisition folks on how to craft the solicitations with small businesses in mind.

Q: What are the advantages for DLA in having a portion of its contracts with small businesses?

A: There are numerous benefits. Small busi-nesses increase the size of the industrial base. They stimulate the economy. They increase competition. Seven out of every 10 new jobs are created by small businesses. So there are benefits to the military, to the economy and to the taxpayer.

Q: What does a small business need to do to prepare to do business with DLA?

A: The first thing they need to do is to access our DLA small business webpage. This will give them instruction on what to do. It will tell them how to register in the Central Contracting Reg-istration database and to request a DUNS [Dun and Bradstreet] number. It tells them how to search the DLA Internet Bid Board System and to identify requirements by NAICS or by NSN [National Stock Number].

In addition, my office also manages the Procurement Technical Assistance Program on behalf of the Department of Defense. Since 1985, Congress has appropriated money to establish Procurement Technical Assistance Centers [PTACs] all over the country to pro-vide technical assistance to firms that want to

do business with state and local government or with the federal government. We currently have 93 PTACs, including six Native American centers and one each in Guam and Puerto Rico.

We participate in outreach events, and we counsel vendors one-on-one, both in person and telephonically, answering any questions they have. We provide counseling to prospective businesses and we will even tell them how to fill out forms if that is what they need.

Q: Are small businesses held to the same level of responsibility and accountability as large firms?

A: Absolutely, all the same rules apply. They must deliver what they agree to in the contract, of the right quality and when they promise to deliver it. These are the same expectations as for large business suppliers.

Q: How would you like to see the DLA Small Business Office evolve or services added?

A: After almost 27 years in DLA, I have been in this position for about a year. One of the things I have found is that it is challenging for buyers and contracting officers to research and identify all the possible small business sources when they send out solicitations and make awards.

So I have started data mining to identify possible additional sources. For example, we have searched a Veterans Administration data-base of certified service-disabled veteran-owned small businesses to identify those that we have not bought from before. I have passed that list on to DLA procurement offices.

Also, the Department of Defense has selected 83 NAICS codes for seeking business from women-owned small businesses. So we have searched the Central Contractor Registra-tion database for these businesses that we have not bought from before as well.

We want to identify more service-disabled small businesses, so we are in the process of set-ting up meetings with representatives from the VFW [Veterans of Foreign Wars], the American Legion, the Disabled American Veterans Asso-ciation and the Service-Disabled Veteran-Owned Small Business Council to brainstorm opportu-nities to expand our industrial base in this area. We want to bring on additional sources of supply.

DLA Director Vice Admiral Mark Harnitchek is very interested in procurement from small businesses. I speak with him weekly on our small business efforts and brief him every month in executive session. Small business is very high on his priority list and has been since he arrived. O

Q&A with Amy Sajda,Director of DLA SmALL BuSineSS ProgrAmS



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MOTOR OIL (HELLAS) CORINTH REFINERIES S.A. 23 395,618,687.48 0.004% 1.104%

OWENS & MINOR 18,168 378,588,360.23 3.135% 1.057%

MINA CORP LTD 21 357,446,852.05 0.004% 0.998%

GAZPROMNEFT-AERO KYRGYZSTAN LLC 2 347,479,836.98 0.000% 0.970%

RAM DIS TICARET A S 12 342,325,141.99 0.002% 0.956%

EXXON MOBIL 52 334,991,044.07 0.009% 0.935%

TESORO CORPORATION 28 331,189,045.06 0.005% 0.925%

THE BOEING COMPANY 9,318 316,975,810.84 1.608% 0.885%

SAIC INC. 11,659 312,645,067.56 2.012% 0.873%

BAHRAIN PETROLEUM COMPANY B.S.C. (CLOSED) 9 279,984,653.43 0.002% 0.782%

NORTHROP GRUMMAN CORPORATION 842 259,405,172.03 0.145% 0.724%

BAE SYSTEMS PLC 3,267 257,297,067.03 0.564% 0.718%

ACCENTURE PLC 79 250,072,371.94 0.014% 0.698%

TOTAL RAFFINAGE MARKETING 14 233,032,451.35 0.002% 0.651%

SK INNOVATION CO. 20 224,641,626.37 0.003% 0.627%

ARCTIC SLOPE REGIONAL CORPORATION 17 217,865,279.54 0.003% 0.608%

TEXTRON INC. 3,500 217,243,695.30 0.604% 0.607%

AMERIQUAL GROUP 264 216,358,601.34 0.046% 0.604%

REFINERY ASSOCIATES OF TEXAS INC. 49 208,764,047.42 0.008% 0.583%

RED STAR ENTERPRISES LTD 14 194,450,739.85 0.002% 0.543%

HONEYWELL INTERNATIONAL INC. 5,359 190,399,767.04 0.925% 0.532%

BELL BOEING JPO 526 188,748,639.13 0.091% 0.527%

WESTERN REFINING 7 183,908,089.33 0.001% 0.513%

SUPREME FUELS TRADING FZE 7 183,106,918.56 0.001% 0.511%

RAYTHEON COMPANY 1,238 177,470,966.08 0.214% 0.495%

S-OIL CORPORATION 8 173,352,511.44 0.001% 0.484%

COMPANIA ESPANOLA DE PETROLEOS SA 6 162,158,798.78 0.001% 0.453%

GOVERNMENT OF CANADA 433 149,783,235.81 0.075% 0.418%

OSHKOSH CORPORATION 2,590 148,163,491.81 0.447% 0.414%

UNITED CAPITAL INVESTMENT GROUP INC. 5 141,267,793.73 0.001% 0.394%

CONOCOPHILLIPS 17 138,352,776.39 0.003% 0.386%

SECURIFORCE INTERNATIONAL AMERICA LLC 4 137,978,346.20 0.001% 0.385%

GOODRICH CORPORATION 1,579 137,770,605.74 0.272% 0.385%

ADA NAKLIYAT VE DIS TICARET LTD STI 2 135,535,048.87 0.000% 0.378%

AMERICAN WATER WORKS COMPANY INC. 50 130,233,082.78 0.009% 0.364%

MICHELIN ET CIE 6,705 123,313,107.90 1.157% 0.344%

IP&E HOLDINGS LLC 3 120,415,919.30 0.001% 0.336%

AGILITY PUBLIC WAREHOUSING CO. KSC 1,514 115,208,049.44 0.261% 0.322%

VITOL INC. 5 114,438,946.50 0.001% 0.319%

CARTER ENTERPRISES LLC 40 110,498,003.55 0.007% 0.308%

UNAKA COMPANY INC. 147 109,947,987.99 0.025% 0.307%

GS CALTEX CORPORATION 21 107,374,158.66 0.004% 0.300%

CFM INTERNATIONAL INC. 558 107,315,046.93 0.096% 0.300%

GRAYBAR ELECTRIC COMPANY INC. 4,761 106,940,954.08 0.822% 0.299%

SOURCE ONE DISTRIBUTORS INC. 608 104,971,740.33 0.105% 0.293%

NICHE INC. 14 103,858,529.00 0.002% 0.290%

HESCO BASTION LTD 118 103,700,323.74 0.020% 0.290%

U.S. OIL TRADING LLC 7 102,720,624.72 0.001% 0.287%

ROLLS-ROYCE GROUP PLC 708 101,526,214.15 0.122% 0.283%

PATRIOT PETROLEUM INC. 11 99,313,499.26 0.002% 0.277%

TRAJEN FLIGHT SUPPORT LP 13 97,930,886.76 0.002% 0.273%

WORLD ENERGY CORPORATION 24 96,949,717.38 0.004% 0.271%

AAR CORPORATION 1,914 95,157,849.87 0.330% 0.266%

PARKER-HANNIFIN CORPORATION 2,022 94,658,736.52 0.349% 0.264%

FOSTER FUELS INC. 151 91,022,590.32 0.026% 0.254%

USF HOLDING CORPORATION 8,214 90,300,411.67 1.417% 0.252%

NCS FUEL A/S 9 90,231,660.00 0.002% 0.252%

AMERICAN APPAREL INC. 94 85,386,641.19 0.016% 0.238%

THEODOR WILLE INTERTRADE AG 2,734 83,866,869.64 0.472% 0.234%

GENERAL DYNAMICS CORPORATION 2,219 83,626,192.55 0.383% 0.233%

SUPPLYCORE INC. 5,496 82,630,541.87 0.948% 0.231%

ROCKWELL COLLINS INC. 468 82,514,779.17 0.081% 0.230%

CVR ENERGY INC. 11 81,657,458.72 0.002% 0.228%

REPSOL YPF SA 6 79,939,478.53 0.001% 0.223%

VEYANCE TECHNOLOGIES INC. 35 79,167,985.82 0.006% 0.221%

GULF COAST ENERGY LLC 7 78,564,150.00 0.001% 0.219%

SEVEN SEAS SHIPCHANDLERS LLC 2,230 78,399,646.50 0.385% 0.219%

MEGGITT PLC 985 78,396,030.10 0.170% 0.219%

BBA AVIATION PLC 519 77,336,131.17 0.090% 0.216%

L-3 COMMUNICATIONS HOLDINGS INC. 1,283 73,177,558.72 0.221% 0.204%

NATIONAL INDUSTRIES FOR THE BLIND 231 70,061,011.85 0.040% 0.196%

DMS PHARMACEUTICAL GROUP INC. 7,685 68,905,703.67 1.326% 0.192%

ALON ISRAEL OIL COMPANY LTD. 10 68,235,097.90 0.002% 0.190%

BAHRAIN MARITIME AND MERCANTILE INTL. BSC 1,958 67,158,112.69 0.338% 0.187%

NAVISTAR INTERNATIONAL CORPORATION 975 65,701,103.36 0.168% 0.183%

DDJ CAPITAL MANAGEMENT LLC 157 63,561,263.94 0.027% 0.177%

EATON CORPORATION 2,016 63,407,800.77 0.348% 0.177%

EPIC AVIATION LLC 54 63,228,171.11 0.009% 0.177%

MAXUM PETROLEUM HOLDINGS INC. 32 62,551,630.39 0.006% 0.175%

DOYON UTILITIES LLC 53 61,741,680.54 0.009% 0.172%

PII INC. 61 61,568,265.64 0.011% 0.172%

READYONE INDUSTRIES INC. 17 58,354,838.40 0.003% 0.163%

ENERSYS 783 57,584,788.12 0.135% 0.161%

COBHAM PLC 842 57,094,966.86 0.145% 0.159%

DLA Top Contracts FY11

Global Vendor Name # Of Actions Dollars Obligated % Total

Actions% Total Dollars Global Vendor Name # Of

Actions Dollars Obligated % Total Actions

% Total Dollars



DoD Procurement Technical Assistance Program

The DoD Procurement Technical Assistance Program (PTAP) was established by Congress in 1985 to provide DoD assistance to eligible entities by sharing the cost of establishing new and/or maintaining existing procurement technical assistance programs. The purpose of the PTAP is to generate employment and to improve the general economy by assisting business firms in obtaining and performing under federal, state and local government contracts.

Chapter 142 of Title 10, United States Code, authorizes the Secretary of Defense to enter into cost sharing cooperative agree-ments with eligible entities. This authority has been delegated to the Defense Logistics Agency. These eligible entities include state and local governments, nonprofit organizations, and Native American economic enterprises and tribal organizations. Within DLA, the DLA director of the Office of Small Business Programs is responsible for PTAP management.

Cooperative agreements are different from contracts. A coop-erative agreement is an assistance instrument where the principal purpose is to transfer funds to a person or entity to carry out a public purpose of support or stimulation authorized by a law of the U.S. On the other hand, a contract is used to acquire goods or services for the U.S. government.

PTAP is an operations and maintenance (O&M) funded pro-gram with a yearly appropriation. The program is a discretionary cooperative agreement program in which DoD/DLA provides up to 50 percent of the cost (up to 75 percent in the case where the pro-curement technical assistance recipient services an economically distressed area) of operating a procurement technical assistance

center (PTAC). Assistance during any fiscal year may not exceed $600,000 for a statewide program and $300,000 for a regional program.

PTACs provide day-to-day assistance to firms seeking to do business with federal agencies and state and local governments in the form of such services as helping prepare bids/proposals, marketing to potential buyers, establishing electronic commerce capability, setting up or improving quality assurance and account-ing systems, and resolving payment problems. This specialized and professional assistance may consist of but is not limited to outreach and counseling type services.

Participants in this program are expected to seek out and assist small businesses, small disadvantaged businesses, women-owned small businesses, historically underutilized business zone small business concerns, veteran-owned small businesses (VOSB) including service-disabled VOSB, and historically black colleges and minority institutions. Participants also provide assistance to large businesses seeking small businesses of all types with whom to subcontract.

The cooperative agreements are administered by the Defense Contract Management Agency except those with colleges and uni-versities, which are administered by the Office of Naval Research.

There are currently 93 PTACs in all states except North Dakota. There are also PTACs in Puerto Rico and Guam. Six of the 93 PTACs are Native American providing services to reservations.

For more information about the program, go to www.aptac-us.org/new/index.php.

current listing of Procurement Technical Assistance centers(This information is current as of June 2012)

ALABAMA

Alabama Procurement Technical Assistance center ProgramThe University of Alabama205-348-1687Fax: [email protected] www.al-ptac.org

ALASKA

Procurement Technical Assistance centers of [email protected] www.ptacalaska.org/

ARIZONA

Arizona Procurement Technical Assistance center Glendale Community [email protected]

ARKANSAS

Arkansas Procurement Assistance centerUniversity of Arkansas Cooperative Extension Service [email protected]/apac.htm

CALIFORNIA

Los Angeles county Office of Small Business/[email protected] http://osb.lacounty.gov

Procurement Assistance centerRiverside Community College [email protected] www.rccpac.com

San Diego contracting Opportunities center – [email protected] www.ptac-sandiego.org

COLORADO

colorado [email protected]

CONNECTICUT

connecticut Procurement Technical Assistance Program860-437-4659, Ext. 208888-673-2837, Ext. [email protected] www.ctptap.org/

DELAWARE

PTAc of DelawareUniversity of [email protected] www.delawarecontracts.com

DISTRICT OF COLUMBIAThere is no PTAC located in the District of Columbia.

FLORIDA

University of West Florida [email protected] www.fptac.org

GEORGIA

Georgia Tech Procurement Assistance [email protected] www.gtpac.org



GUAM

Guam Procurement Technical Assistance centerUniversity of Guam School of Business & Public [email protected] www.guamptac.com

HAWAII

Hawaii Procurement Technical Assistance center (HI-PTAc)808-596-8990, Ext. [email protected] http://hiptac.ecenterdirect.com

IDAHO

Idaho PTAc Idaho Department of [email protected] www.ptac.idaho.gov

ILLINOIS

Illinois Procurement Technical Assistance Program [email protected] www.ienconnect.com\ptac

INDIANA

Partners in contracting [email protected]

IOWA

Iowa PTAcIowa State University Extension – [email protected] www.ciras.iastate.edu/procurement/

KANSAS/MISSOURI

Heartland PTAcMissouri Southern State [email protected]/heartlandptac

KENTUCKY

Kentucky Procurement Assistance ProgramCabinet for Economic Development 800-838-3266502-564-7140www.thinkkentucky.com/kpap

LOUISIANA

Louisiana [email protected] www.la-ptac.org

Northwest Louisiana Government Procurement center [email protected] www.nwlagpc.org/

MAINE

Maine [email protected] www.maineptac.org

MARYLAND

Maryland Procurement Technical Assistance [email protected] www.mdptap.umd.edu

MASSACHUSETTS

Massachusetts Small Business Development center Network/PTAcUniversity of [email protected] www.msbdc.org/ptac/rfc.html

MICHIGAN

Downriver community conference [email protected] www.dccwf.org/economic_dev_ptac.php

Macomb Regional [email protected] www.ptacsofmichigan.org

Muskegon Area First PTAc231-722-7700info@muskegonareafirst.orgwww.muskegonareafirst.org/ptac

Northeast Michigan consortium [email protected] www.nemcworks.org

PTAc of Northwest [email protected] www.nwm.org/ptac.asp

PTAc of Schoolcraft [email protected] www.schoolcraft.edu/bdc/ptac.asp

PTAc of South central [email protected]

Southwest Michigan Procurement Technical Assistance center269-381-2977, Ext. [email protected]/swmiptac

Genesse Regional chamber of commerce810-600-1432ptac@thegrcc,org www.thegrcc.org/ptac

MINNESOTA

Metropolitan Economic Development Association [email protected] www.ptac-meda.net

MISSISSIPPI

Mississippi Procurement Technical Assistance ProgramMississippi Development [email protected] www.mississippi.org/mptap

MISSOURI

Missouri Procurement Technical Assistance [email protected] www.moptac.net Note: Missouri Southern State University (MSSU) provides procurement technical assistance in southwest Missouri. Find contact information for MSSU under Kansas.

MONTANA

Montana Procurement Technical Assistance center406-256-6871, Ext. [email protected] www.bigskyeda-edc.org/

NEBRASKA

Nebraska Business Development [email protected] http://ptac.unomaha.edu

NEVADA

Procurement Outreach ProgramGovernor’s Office of Economic [email protected] www.diversifynevada.com/divisions/procurement_outreach/

NEW HAMPSHIRE

New Hampshire Procurement Technical Assistance Program 603-271-7581 [email protected] www.nheconomy.com/sell-to-the-government

NEW JERSEY

NJIT - Procurement Technical Assistance center [email protected] www.njit.edu/dptac

UcEDc Procurement Technical Assistance [email protected] www.ucedc.com

NEW MEXICO

NMSBDc/PTAP Lead [email protected]/ptap-government.html

NEW YORK

cattaraugus county [email protected] www.ccptac.org

LaGuardia community college Procurement Technical Assistance [email protected] www.laguardia.edu/ptac/

New York city Department of Small Business [email protected] www.nyc.gov/sbs

North country [email protected] www.northcountryptac.com

Monroe county Finger Lakes PTAc585-753-2015/[email protected] www.monroecountyfingerlakesptac.org

Rockland Economic Development corporation [email protected] www.redc.org/new/index.php?/site/ptac

SoBRO [email protected] www.sobro.org

NORTH CAROLINA

North carolina PTAc [email protected] www.nc-ptac.org

NORTH DAKOTAThere is no PTAC located in North Dakota.

OHIO

Procurement Technical Assistance centers of OhioOhio Department of [email protected] www.odod.state.oh.us/dmba/ptac.htm

Southern Ohio Procurement Outreach center [email protected] www.sopoc.org

OKLAHOMA

Oklahoma Bid Assistance [email protected] www.okbid.org

current listing of Procurement Technical Assistance centers(continued from previous page)



OREGON

The Government contract Assistance Program [email protected] www.gcap.org

PENNSYLVANIA

Government Agency coordination OfficeCalifornia University of [email protected] www.calu.edu/business-community

IUP Government contracting Assistance Program [email protected] www.iup.edu/ptac

Johnstown Area Regional Industries PTAc814-535-8675 [email protected] http://jari.com/jari/services_procurement.html

NEPA Alliance PTAc 570-655-5581, Ext. [email protected] www.nepa-alliance.org/ptac/index.htm

Northwest Pennsylvania Regional Planning and Development commission814-677-4800, Ext. [email protected] www.nwcommission.org/gov.html

SEDA council of [email protected] www.seda-cog.org/ptac

Southeast Pennsylvania Procurement Technical Assistance [email protected]/government

Southern Alleghenies Planning & Development commission [email protected] www.sapdc.org/helpingbusinesses/howtogetgovernmentcontracts.aspx

PUERTO RICO

Puerto Rico Federal contracting center787-758-4747, Ext. [email protected] www.federalcontractingpr.com

RHODE ISLAND

Rhode Island Procurement Technical Assistance [email protected] www.riptac.org

SOUTH CAROLINA

Sc SBDc/PTAcUSC Technology [email protected] www.scsbdc.com/ptac.php

SOUTH DAKOTA

South Dakota Procurement Technical Assistance [email protected] www.usd.edu/ptac

TENNESSEE

University of TennesseeCenter for Industrial [email protected]

TEXAS

Angelina college Procurement Assistance center [email protected]

contract Opportunities [email protected] www.elpasococ.org

Del Mar college [email protected] http://dmc122011.delmar.edu/sbdc/ptac.html

Rio South Texas Regional [email protected]/ptac

Texas Tech University Procurement Assistance [email protected] www.nwtpac.org

University of Houston Procurement Technical Assistance center [email protected] www.ptac.uh.edu

University of Texas at Arlington Cross Timbers Procurement [email protected] www.ctpc-texas.org

West Texas contract Procurement [email protected] www.contractprocurementcenter.com

UTAH

Governor’s Office of Economic [email protected] http://hbusiness.utah.gov/ptac

VERMONT

Vermont Procurement Technical Assistance center [email protected] http://economicdevelopment.vermont.gov/vtptac

VIRGINIA

crater Procurement Assistance [email protected]

Virginia Procurement Technical Assistance ProgramGeorge Mason University Mason Enterprise [email protected] www.vaptap.org

Southwest Virginia community college [email protected] http://ptac.sw.edu

WASHINGTON

Washington [email protected]

WEST VIRGINIA

Regional contracting Assistance center304-344-2546, Ext. [email protected] www.rcacwv.com

WISCONSIN

Business Procurement Assistance center [email protected] http://madisoncollege.org/bpac

Wisconsin Procurement Institute414-270-3600 [email protected] www.wispro.org

WYOMING

Wyoming [email protected] www.wyomingentrepreneur.biz/

NATIVE AMERICAN PTACsCoverage is by Bureau of Indian Affairs (BIA) Regions

American Indian chamber Education Fund – [email protected] www.aicccal.org/ptacwebsites/ptachome3.htm Covers entire Pacific Region and half of Western Region

UIDA Business Services [email protected] www.uida.org/Covers entire Southwest and Navajo Regions and half of Eastern Region (AL, CT, FL, LA, MS, NC, RI, SC)

First American capital corporation PTAcOneida Skenandoah [email protected] www.faccptac.com Covers entire Midwest and half of Eastern Region (NY, ME, MA)

NADc PTAc406 [email protected] www.nadc-nabn.org/Covers entire Rocky Mountain Region and half of Great Plains Region

Tribal Government Institute [email protected] www.tgiok.com/Covers entire Eastern Oklahoma and Southern Plains Regions

Native American [email protected] www.nativeptac.org/ Covers entire Alaska and Northwest Regions

current listing of Procurement Technical Assistance centers(continued from previous page)

The Defense Logistics Agency, on behalf of the Secretary of Defense, administers the DoD Procurement Technical Assistance Program. Procurement Technical Assistance Centers are a local resource available at no or nominal cost that can provide assis-tance to business firms in marketing products and services to the federal, state and local governments.

Website: www.dla.mil/smallbusiness/pages/procurementtechnicalassistancecenters.aspx



Compiled by KMi Media Group staffSUPPLY CHAIN

USNS Medgar Evers

General Dynamics NASSCO has delivered USNS Medgar Evers (T-AKE 13) to the U.S. Navy. The ship is named in honor of the slain African-American civil rights leader from Mississippi who served as the state’s first-ever field secretary for the National Association for the Advancement of Colored People (NAACP).

Construction of the USNS Medgar Evers began in April 2010. NASSCO has incorpo-rated international marine technologies and commercial ship-design features into T-AKE-class ships, including an integrated electric-drive propulsion system, to minimize operating costs during each ship’s projected 40-year service life. During the course of the decade-long T-AKE Program, NASSCO has implemented more than 20,000 ideas to drive down costs and improve quality and more than 1.5 million hours have been invested in employee training

since 2006. With a cargo capacity of more than 10,000 tons, the primary mission of T-AKE ships is to deliver food, ammunition, fuel and other provisions from shore stations to combat ships at sea.

“As demonstrated on our successful sea trials three weeks ago, the Medgar Evers is ready for immediate service,” said Fred Harris, president of General Dynamics NASSCO. “The 12 deployed T-AKE ships are performing and proving their ability to serve the fleet in their primary missions and in a variety of other roles.”

Including the Medgar Evers, NASSCO has delivered the first 13 ships of the T-AKE (Lewis and Clark) class to the Navy. The 14th ship and final ship of the class, USNS Cesar Chavez, was christened and launched on May 5, before its delivery in fourth quarter 2012.

Be Alert

Desktop Alert Inc., a provider of IP-based mass notification to the U.S. Army worldwide, recently announced that the U.S. Army stationed in Afghanistan has procured the Desktop Alert Emergency Mass Notification System (EMNS).

The selection furthers the compa-ny’s position within the U.S. Army as the predominant IP-based mass notification platform postured to support the warf-ighters in CONUS and OCONUS locations.

U.S. Army locations seeking to imple-ment an EMNS solution similar to the mass notification system deployed by the U.S. Army in Afghanistan, Fort Huachuca

and Fort Hood can contact Desktop Alert for a briefing and system demonstration.

The Desktop Alert EMNS provides bi-directional extensibility and integra-tion with IP-based phones, landline and cell phones, computers, digital displays and kiosks, text messaging, pagers, public address system, common area alerting devices and secure social media end-points. The system also boasts the most complete solution for Cisco UC infra-structure available on the market today with over 700 Cisco UC customers using the award-winning Cistera Convergence Server.

Engine Filtration Protection

Donaldson Aerospace & Defense, a division of Donaldson Company, Inc., has delivered the first complete shipset of CH-53K engine air particle protection system (EAPPS) units to Sikorsky Aircraft. The milestone delivery supports Sikorsky’s System Development and Demonstration Program. The advanced engine protec-tion units featuring Donaldson’s patented Strata Tube technology will be installed on the CH-53K Ground Test Vehicle. The complete shipset included an EAPPS for the number 1, 2 and 3 engines including the integral engine inlet supplied by Meggitt and installed by Donaldson.

“Donaldson is proud that our advanced filtration system will contribute to mission readiness for this critical future military asset,” said Sheila Peyraud, general manager, aerospace and defense at Donaldson. Peyraud added that qualification testing is in progress at Donaldson headquarters in Minneapolis, and so far “the results exceed all specifications and requirements.”

In 2007, Donaldson was awarded the contract to design, develop and qualify an inlet filtration system that would protect each of the CH-53K helicopter engines. Using Donaldson’s patented Strata Tube technology, the company has developed a lightweight, high efficiency filtration system that requires minimal maintenance. The United States Marine Corps will operate the CH-53K, a brand new aircraft maintaining the same physical config-uration and footprint of the legacy CH-53A/D/E/G heavy lift helicopters. It is designed to operate in harsh, mountainous and desert environments while providing a substantial increase in lift capability. The CH-53K aircraft is scheduled to achieve its initial oper-ating capability in fiscal year 2019 and is planned to replace the current inven-tory of CH-53Es.


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From manufacturing support to aftermarket services, we help global leaders stay one step ahead of change, and find value in their supply chains. We can do the same for you.

Your supply chain can. Visit NewBreed.com and learn why Boeing, Honeywell, Navistar Defense, Pratt & Whitney, Sikorsky Aircraft, the US Marine Corps and Woodward rely on a new breed of partner for mission-critical supply chains.

Redding Hobby, a member of the Senior Executive Service, is the acting director of Defense Logistics Agency Logistics Opera-tions. DLA Logistics Operations (J3) is responsible for the end-to-end supply chain management of the Defense Logistics Agency’s eight supply chains, providing logistics and material process management policy, guidance, oversight and monitoring of sup-ply chain performance. J3 is the principal strategic, operational and tactical planner for DLA business operations, champion-ing best business practices, Enterprise Business Systems and value-added logistics solutions for the warfighter. J3 oversees the daily operation of the DLA Logistics field activities and engages customers around the world to maximize readiness and logistics combat power by leveraging an enterprise solution.

Hobby has served in a wide range of military and civilian positions during his tenure with the federal government. Most recently, he was the executive director of the Strategic Programs and Initiatives Directorate, where he oversaw responsibility for managing strategic plans, programs, concepts and initiatives for the current to near future in order to inform and influence deci-sions on policy, strategy and the development of capabilities to enhance anticipated logistics support to warfighters. Part of this mission included overseeing implementation of the Base Realign-ment and Closure 2005 Supply and Storage recommendations that focus on Defense Department logistics supply chain integra-tion.

While on active duty as an Army officer, he commanded at platoon, company, battalion and brigade levels. He saw extensive service in tactical-level organizations in Europe, Korea and the United States. He became a logistician in 1984. Hobby’s mili-tary service culminated in 2002, when he retired as a colonel of ordnance and transitioned to civil service. He served as an envi-ronmental physical scientist, logistics specialist and Army Senior Executive Service member. He was appointed to the Air Force Senior Executive Service in 2008.

Hobby graduated from the U.S. Military Academy, West Point, N.Y., in 1973, receiving a Bachelor of Science degree in engineer-ing. He is a graduate of the Army Command and General Staff College, Fort Leavenworth, Kan., and the Army War College, Carlisle, Pa.

His personal awards include the Bronze Star, the Legion of Merit with three oak leaf clusters, the Meritorious Service Medal with oak leaf cluster, the Joint Meritorious Civilian Service Award,

two Meritorious Civilian Service Awards and the Achievement Medal for Civilian Service. He is a senior parachutist and an Army Ranger.

Redding Hobby was interviewed by KMI Media Group Editor-in-Chief Jeff McKaughan

Q: What are the budget implications for DLA and how is that driving agency efficiencies from where you sit?

A: The Defense Logistics Agency is a defense working capital fund organization. That means we provide sustainment support to the military services on a reimbursable basis. If a unit needs a repair part, for example, DLA’s Land and Maritime organization or our DLA Aviation organization or perhaps DLA’s Troop Support orga-nization procures that part and we provide it to the service. Their Title 10 responsibility then, in a manner of speaking, reimburses us for that.

In austere budget times, DLA sells less, so we adjust our busi-ness models to accommodate the needs of the services. We will focus on the demand signals we get from the military services and adjust our acquisition strategies appropriately. We never want to over or under buy, so we focus on hitting it just right and buying what the services need in a timely manner. In that way, we syn-chronize with our primary supported units and customers—the military services.

Redding Hobby Acting Director

Defense Logistics Agency Logistics Operations Directorate

Supply OptimizerMaintaining a Globally Responsive Supply Chain

Q&AQ&A


Q: Buying—what will that mean for staffing at DLA?

A: It will probably mean an increase in our contracting corps. As we work hard to get the demand signals right, which is one of our biggest challenges, our acquisition professionals are focused on procuring those demands.

Since we use the working capital fund, we don’t work with a table of organization equipment or a table of distribution and allowances like our military service partners. Instead, we work on a need basis and manage our workforce to the requirement. If we need more acquisition folks because of the rigor that goes into planning and purchasing, we may have to increase that workforce.

On the other side of the coin, the distribution and storage requirement will probably decrease. If so, our manning and sup-port to those kinds of functions will shrink. Overall, I would say the budget impact on the structure and the face of DLA from an orga-nizational point of view probably won’t make us change very much. We won’t face significant personnel cuts like the military services are facing. Instead, we face a challenge to ensure we have the right skill set appropriate to meet the largest challenges. This gives us huge opportunities for efficiencies. It’s much like the private sec-tor—the better you can provide the material to your customer, the more likely they are to buy. The more accurate you are in meeting their demand, the more likely they are to have what they need when they need it. It’s about hitting the sweet spot between focus-ing on the supplier side or the distribution side … about focusing on the acquisition side or the supply and storage side. Those are the metrics we look at when we right size and right-skill our workforce.

Fortunately, DLA has more than 50 years of experience to draw upon. We consider past practices and past challenges and come up with some pretty accurate staffing models that give us what we need to come real close to what right looks like to support the services effectively and efficiently.

Q: Are there any initiatives that highlight what DLA is doing to shoulder their share of the burden of generating efficiencies and meeting goals?

A: That’s the perfect question.It may sound like it’s just business as usual for DLA … that

we simply shift resources around but nothing else would change. Nothing could be further from the truth.

Our director has challenged us to be effective and efficient—we’ve coined it the 10 in 5 plan, $10 billion in five years. He’s chal-lenged us to take $10 billion out of DLA over the next five years.

Last year, DLA was about a $46 billion enterprise. About $4.5 billion goes to running the business at DLA; the other $40 billion is tied to sales. Given those two numbers—$40 billion and $4.5 billion—which number should we focus on? Our director’s chal-lenge is to go after the big number—to take $10 billion out of sales, while dramatically improving performance. In no way does this mean we’re going to change readiness rates and not provide sustainment. The biggest single initiative is looking at ways we can be more effective over the next five years to achieve that $10 billion dollar reduction.

So how do we actually make it happen?There are several programs that are going to help.Strategic network optimization [SNO] is the first. It’s an effort

to get our distribution arcs—how we deliver the supplies to our

supported units, how we provide material to our customer and how we position that material around the world—as efficient as they can be. As background, we have 10 years of experience from two wars in two theaters, while supporting the continental U.S. and the other geographic COCOMS. The demand patterns that we’ve used over the last 10 years give us some dramatic demand history for look-ing forward—who needed what when, what issue priority it was supplied against, and how many pounds or items went to these different locations.

Using some modeling processes, we looked at where the mate-rial flowed from, which distribution depot to which customer, etc. We’ve asked that model be optimized based on cost, time and weight. Using those models, we look at where the efficiencies lie. Was this cost driven? Supply driven? Could we have purchased it instead of moved it? Or was it cheaper to have moved it instead of purchasing it? Taking that information, we then apply the opera-tional impact on these models.

In the initial phase, when we optimized only the process, we came up with a little over $700 million of savings just by a distri-bution optimization. In phase two, we’ll look at how to optimize inventory by looking at what we buy, when we buy and where it’s positioned.

So if it’s something that’s going to be delivered to the central U.S.—Fort Hood, Texas, for example—we’ll position that material at a distribution site that’s as close to Fort Hood as possible and then buy the supplies that Fort Hood needs and store them close by. We may have material now in our pipeline or in our ware-houses at another location, and it may be cheaper to ship that material from that known location today to that distant location where that customer is, but it would be bought back to the closer location. Doing it this way means we don’t waste material and we don’t mistakenly position material. It’s all about making our process more effective.

We borrowed Willie Sutton’s idea of following the money, so we focus on where the money is. Now that we have the distribution process optimized, we position the material in those optimized locations to get a double payback for our investment. We get not only the distribution dividend, but the inventory dividend as well.

Finally, the third leg of the SNO stool is the infrastructure. As we better position material, certainly there’s going to be ware-housing space that will be freed up. Not all at one time, as it’s a slow process, but over the next five years as those facilities are freed up, we’ll be able to take those locations out of the inventory or pass them back to the services. We’re also working with another department and the Secretary of Defense to see if we can get demo-lition money to assist the services in demolishing excess locations. We could avoid a double touch for that excess warehouse by cen-tralizing the demilitarization and demolition if that was what the service was planning on doing anyway. Unused facilities tend to fill up because there’s always a natural tendency to store things. SNO will discourage bad behavior and reduce unnecessary costs.

Q: You mentioned not only having the supplies but getting them into the distribution channels—the PAKGLOC for example. You all don’t handle or transport materials yourselves. How do you adjust for circumstances that will impact the delivery of supplies?

A: On November 26, 2010, the PAKGLOC closed. We’d been depen-dent on it for almost 10 years, moving material with our partners


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in USTRANSCOM through Karachi and then upward through two main ground routes through Pakistan into Afghanistan.

As a logistician, I’ve watched that movement from several dif-ferent jobs that I’ve held over the last five or six years. If you had asked me prior to November 2011, what do you think about that, I would have said well, that’s the way we do things. It’s almost an assumption that we’ll move on the ground because of the access and the distance in a landlocked country and all the operational impact. When it closed, there was a little bit of a concern on the part of DLA about how we would provide sustainment inside a landlocked country, knowing that we’d been heavily dependent on that Pakistan ground line of communication.

Fortunately, in about 2008, USTRANSCOM and Central Com-mand decided they needed another entrance, and the northern distribution network was established. Frankly speaking, our depen-dence on the PAKGLOC was really on my mind. As it turned out, we were not as dependent as I had thought we were. The northern distribution network and the effective partnership between DLA and USTRANSCOM proved a successful workaround, based on the dedicated effort, focus and outstanding support by the rank and file members of both organizations—USTRANSCOM and their ground component is the Surface Deployment and Distribution Com-mand—as well as other partners. Quite frankly, since the early part of 2012 we’ve even grown our theater sustainment support.

Q: Staying with Afghanistan, looking at how you did things in Iraq versus how you’re going to have to do things in Afghanistan, what does DLA’s forward deployment structure look like in Afghanistan in comparison to Iraq? Is the structure you have now an evolving structure or are you where you want to be?

A: I’ll tell you like all the operators will tell you, Afghanistan is not Iraq—but our structure is very similar. We have a DLA support team headed up by a military 06 who manages the various commodities, supply chains we support, and the distribution processes we have in place. If you look at the reverse logistics, the disposition require-ments, the defense reutilization and marketing office—there are three sites today in Afghanistan. That structure is very similar to what we used in Iraq. We had the same reutilization and marketing office sites, where the military members could turn in equipment that was no longer needed or was unserviceable. In Iraq, as it came time for the repositioning out, units were able to move some ser-viceable material to us and let DLA provide the disposition services.

There were several categories of that reutilization that we were able to use to help us identify exactly how to do that right. First of all, we would try to redistribute it to needs that the services had. If that didn’t work, then we would try to market it and sell it as scrap or as unserviceable military gear. If that didn’t work, then we would take the responsibility for demilitarizing it or destroying it and then additionally selling that demilitarized material as scrap to eligible consumers.

I’d be remiss if I didn’t say that the theme there is the deployable agility of the DLA workforce. Some of that work I described is inher-ently governmental, so we need DLA employees to step up to the responsibility of deploying, and we’ve had incredible success with our employees stepping up to those responsibilities.

Q: You’ve explained the structure that DLA has in Afghanistan. Can you go a little deeper into what DLA will do to manage the

flow of equipment and avoid mountains or iron or tremendous backlogs?

A: The role that DLA plays and its support to the mission will be very similar to that in Iraq: to provide a single touchpoint for the combatant commander and his component commands inside the AOR to turn to for disposition services and capabilities. In Iraq, we established a place to unburden the services of excess and no longer serviceable equipment, and ensured what went back was exactly what had to go back. The end goal is identical in Afghani-stan. However, techniques, tactics and procedures for doing this will be different, because we don’t have an outlet. There is no mature government infrastructure to do business with, from a marketing and resell environment, so our practice and our tech-nique of managing that will be somewhat different. We’ll have to work carefully on how we plan to do the demilitarization, for instance.

Let me give you an example. Today, in Iraq, we are able to successfully market to the Iraqis. A businessman in Iraq could purchase over 600,000 pounds of scrap from our DRMO site. We don’t have that same enterprise opportunity in Afghanistan, but we in DLA still have the requirement to demilitarize that material and move it into a categorization called scrap. What we’re going to do with that and how we actually dispose of it in that country is something we’re working on. We don’t have any perfect answers. Moving it out of that country, paying to ship it, is not an alterna-tive. It’s too expensive; we don’t get any return on that investment for our taxpayer. So we’ll have to come up with an innovative approach to actually dispose of that material. I’ve talked about the reutilization and the resale and the actual disposal of it. How we move that out of Afghanistan, off their terrain, is something we’re working real hard.

Q: Does DLA have a seat at the table in deciding what happens to a piece of equipment? What’s DLA’s role in that decision?

A: That’s another great question. Almost all the military equip-ment over there belongs to the military services. There’s very little actual material, actual supplies, that belong to DLA. Some of our sustainment repair parts, for example, belong to DLA until we have a requirement for them from the service, a point of sale if you will, and we then transfer it to the military service that needs it. But by and large, the things you’re talking about—military weapons systems, trucks, communications systems, infrastructure like the re-locatable buildings and tents—all belong to the services.

Despite that, we absolutely have a seat at the table. I would say we’re a partner with the services on that. We’re not an equal partner—it’s their supplies, it’s their material, it’s their weapons systems and fighting platforms—but we absolutely sit at the table with them and provide our expertise with regard to the tactical questions: How can I move it to you? What condition does it need to be in? What are the processes I need to go through to take it off my records so the supply record-keeping is accurate? Those sort of administrative functions that make sure the property is properly documented and taken care of are accomplished in partnership with the units. DLA plays a key role in that.

With regards to physically transferring property, those three sites that I talked about occupy approximately 40 acres in theater and we’re about to double that over the next few months as we

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prepare to reposition forces out. There’s a physical space opera-tion in addition to the academic aspect of keeping records and the integrity of our supply system; all are critical to know what we equipment we have and whose books it’s on. DLA acts as a partner to provide disposition instructions: what goes on with that gear, how it gets handed off to DLA, and where we put it so we can then do the proper thing to accommodate the last portion of disposition.

I mentioned two important parts. One is record-keeping and the other is the actual handling and transfer of equipment that the unit no longer needs. DLA partners with the units to help them unburden themselves of the unnecessary gear so they can transfer important things back to the states. That has a huge impact on that reverse logistics pipeline. By taking out excess, we take out items that aren’t authorized or aren’t needed back at home station when that unit redeploys. So I think we play a key role. Just to reiterate, we absolutely do that from a seat at the table, in concert with the units that are redeploying.

Q: Let’s talk about inventory: Excess inventory is excess cost, both in storage and in the acquisition of it. Can you go into detail about demand planning and forecasting?

A: We have three major supply centers: our DLA Land and Maritime Organization in Columbus, the DLA Aviation Organization in Rich-mond, and our DLA Troop Support Organization in Philadelphia. Those are our three supply centers and they face the customer.

Clearly, that’s the interface to answer the challenging question of what is your demand, what is your requirement. Those organiza-tions, as a part of BRAC 2005, put DLA employees inside the plan-ning processes within the services. Prior to 2005, some of those people belonged to the services. They were Army, Navy, Air Force and Marine Corps employees. As we extended DLA into the retail world, those employees became DLA employees. Some of this has only occurred in the last five or 10 years, but it gives us a huge abil-ity to understand service requirements. So those planners, buyers if you will, are forward positioned with the services.

Let’s use the example of a depot maintenance activity in the Army: DLA planners are embedded in that depot activity. When the depot gets its annual workload funded by the services’ maintenance budgets, those depot maintenance dollars are planned and pro-grammed against a requirement to produce a planned number of vehicles or items of equipment through that depot process. What a great place for our interface to take place. As the service plans their maintenance and production workload, DLA is planning the sustainment with them. Our supply centers have the customer fac-ing responsibility to get the requirement just right, and then, once they have it right, put those items on acquisition and requisition processing.

Let’s say a weapons system is being repaired at one of the Army maintenance depots. As that depot’s plan for the fiscal year is produced, we put those requisitions into process simultaneously. So when that material appears in the depot line for repair, the sustainment repair parts are right there with it. I could describe a similar process for the Navy shipyards: As a ship comes in for a repair cycle, the repair cycle might be longer—perhaps three years for a ship—but our process is the same. As that ship is identified, the planning begins immediately for arguably about 50 percent of what that ship’s going to need. As the time draws closer and the programming becomes available, that 50 percent goes to more like

80 or 90 percent. So by the time the ship goes into dry dock, the material is in place in the depot system. It may be one of our major distribution depots, or it may be forward positioned actually inside the Navy shipyard.

There’s an effectiveness criteria and an algorithm we use for whether we forward position it right there or if we have the delivery capability based on our historical demand to be able to hold it and not do the point of sale until it’s actually needed. That gives the services great flexibility with their working capital, to let the defense working capital hold that material until we get that point of sale. Great efficiency and flexibility for the services, and quite frankly, it’s efficient. If the service bought the material, there would always be a tendency to buy an insurance level, to have it just in case. This takes away the “just in case I need it, or might need it, or potentially could need it,” and lets DLA assume responsibility. When the demand hits, we’ve got an obligation for customer support to provide that material on time, so that nothing in the production cycle gets inter-rupted. We do that on DLA’s dime.

Q: Planning for major military operations always include the logistics arm, but what of DLA’s role in unplanned events—for example, the Japanese tsunami, Katrina, the earthquake in Haiti. What’s DLA’s role in meeting the logistics obligations when the military responds to those things?

A: You know, in military parlance, we call what you describe the range of military activities from major combat operations to the humanitarian assistance or the disaster relief that you describe.

Honestly, that humanitarian assistance and disaster relief is far more likely to occur. The last three or four years has proven it. DLA has to be prepared for that. We leverage DLA’s data and data analysis to position certain items forward—blankets, cots, some food and bottled water—in anticipation of that most likely scenario, particu-larly in the overseas environment.

Should the Defense Department be called upon, DLA’s role is much like it would be in major combat. We would have a sustain-ment role, providing the food and the bottled water that are critical to life support. If you take it to the next level, victims would require shelter. DLA would be there to provide tents and cots and blankets.

This does not mean DLA provides all of the food. If the Defense Department does not have the lead, the World Food Program and other non-governmental organizations are the first responders. However, when we have crisis situations like Tomadochi, or as you mentioned Katrina, where we have rapidly deteriorating or destroyed infrastructure, non-governmental organizations may not have the capability to do the distribution process. That’s a situation where the Defense Department can be effective. One of the services would probably go in with the military gear and the troop strength, and DLA would provide support through one of our field activities.

While DLA is unlikely to provide direct support to one of the non-governmental organizations, it has provided support to FEMA. If the infrastructure and the distribution processes allowed us to position material, FEMA or another DHS organization might do the last tactical mile, if you will, and put the supplies in the hands of those that need it the most.

Q: What is DLA’s customer service mantra? How do you measure and improve on customer service, and how do you measure your status?


A: Our mantra is “Warfighter Support.” We have three major pil-lars that we base our core competencies on: warfighter support, stewardship excellence and workforce development. Number one among those is support to the warfighter customer; whether in Afghanistan or at Schofield Barracks, Hawaii, it is our primary concern.

I mentioned how we face the depots and accomplish demand planning with our supply centers. From a DLA perspective though, there’s another facet of that, and that is the direct interface. DLA is a global agency with four regional organizations positioned to liaison with our combatant commands at the geographic combat-ant commands—PACOM, Europe and Africa Command, Central Command, North and South Command, so we’re attuned to the big picture the geographic combatant commander has.

Let’s look at PACOM and focus one level down. The Pacific Command is headquartered in Hawaii, but the Army, Navy and Air Force components are also there, so we positioned a DLA regional commander there [at the 06 level] who has the responsibility to touch all those organizations, through that combatant com-mander.

This way we maintain that customer focus. It’s not just look-ing at what the maintenance production requirement is inside of the service’s industrial site at a depot or a Navy shipyard or air logistics center; it’s also being attuned to the requirements of a combatant commander as they prepare for their operational plans, or for humanitarian assistance or disaster relief.

Q: Is there anything you’d like to add about your customer out-reach programs, or the formalized or informal things you do to keep in touch with customers?

A: DLA does many important things. We provide $40 billion annually in supplies to the services. It’s important we get that right and know what ‘right’ looks like in our planning, pur-chasing and acquisition lead times when we’re getting those supplies.

But I think DLA does something even more important. We build trust and confidence with our warfighter customer. That warfighter support is the first leg of our core competency. Stew-ardship excellence and workforce development will follow if we get the warfighter support right. I really just want to emphasize that DLA is America’s combat logistics support agency. We’re more than a supplier; we serve the total life cycle of an item of equipment, beginning with the customer-facing element of our supply centers, through storage and distribution support, to ultimate disposition services. Today, units are turning in items to a disposition yard in Kandahar, Afghanistan, so they can be released from their mission and go back to home station or prepare for the next contingency. The planning for that has to be done now—not only from the preparedness and readiness point of view, but how to do this most effectively. In this austere bud-get time, we must get our warfighter customer’s requirement exactly right. O

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Logistics procurement management is a key component of DLA Aviation’s mission, aimed at keeping U.S. military aircraft operational and in the air instead of in depots awaiting repairs. Data man-agement technologies and efficiency plan-ning efforts central to this not only reduce downtime by ensuring parts get to where they need to be as fast as possible, they also reduce costs.

“That is really the focus of what we do—buying components for our service customers to make sure they can keep our aviators mission ready,” Brigadier General Scott W. Jansson, commander of DLA Avi-ation, told Military Logistics Forum. “It’s a quite extensive procurement mission.”

He said that while ensuring the effec-tive management of both the supply and demand spare parts chains—which include storage and distribution opera-tions that support aviation needs across the U.S. armed forces through various outposts nationwide—the Richmond, Va.-based agency deals with around 9,000

different suppliers. At times, the agency aggregates the individual needs of each of the services in order to increase buying power.

With depot procurement and storage/distribution operations located from Naval Air Station, Jacksonville, Fla., to Utah’s Hill Air Force Base, the mission supports over 1,300 major weapons systems in total, with more than 440,000 aviation parts of the 1.3 million repair and supply items for which the agency serves as the primary U.S. military supplier.

Jansson explained that that in terms of current fiscal year priorities, DLA Aviation is looking to improve industrial customer support by further improving their ser-vices for aerospace repair depots, which remain its main clients, as well as improve support to operations customers across the services.

“Our first priority is to improve those services to the customer,” said Jansson. “One of the things we are trying to do is execute more timely and affordable

acquisitions, making sure we understand our customer requirements, and reduce the time of getting parts to them. The more agile we are in the supply chain, the more quickly we can turn items around.”

One way that DLA plans to do this is by further reducing already truncated lead times for part replacements, an area in which they have seen great improve-ment in recent years through a num-ber of means. One of those management techniques is simply working closely with suppliers.

Jansson said he meets twice a year with key staffers from strategic suppliers, typically large integrators who are origi-nal equipment manufacturers, including firms like Boeing, Pratt & Whitney and Northrop Grumman. He added that at lower pay grades, staff meets with man-agement personnel from key firms quar-terly to as often as weekly.

Brenda Mitchell, director of military support and services at Pratt & Whitney’s East Hartford, Conn., facility, said the

dLa aviation’s mission is to take the unknowns out of the aviation suppLy chain, whiLe reducing costs and wait time.

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company primarily works with DLA to pro-vide parts for the Air Force’s F100 engine, which powers the F-15 and F-16 fighter.

“We have a long-term strategic contract with DLA that enables us to more effectively and efficiently meet customer requirements in the shortest time possible,” said Mitchell. She noted that having the contract in place has helped reduce lead times from 120 to 45 days or less.

“The long-term contract really enables DLA to get more parts on order because they include, typically, long multi-year prices,” Mitchell told MLF. “Long-term stra-tegic contracts are a key initiative for DLA [and are] really an improvement for us as well. [They] really have helped save time but speed up the supply process as well.”

Jansson said that reducing lead times from partner providers has been a combina-tion of efforts by both his agency and the provider, including allowing suppliers to develop qualified product lines. As a result of such efforts, he said, Honeywell increased reliability from 67 percent to 80 percent last year.

For DLA Aviation, this has meant expe-diting processing times to ensure items meet compliance specs and allowing sup-pliers to better manage their deliverables by anticipating requirements based on his-torical need, including buying raw materi-als in advance. This remains particularly important with parts for which production involves long material lead times.

But such effort amounts to much more than shorter wait times for delivery. Jansson

pointed to several efforts that have accom-plished this along with saving taxpayer dollars. “One of our top priorities is to have more affordable acquisitions,” he said.

For instance, he noted that DLA is intro-ducing more competition into the process for some parts by allowing for reverse engi-neering of existing sourced parts from new sources, as well as other means of imple-menting competition for contract sourc-ing. At times, the firm is also reaching out directly to the manufacturer of parts that were previously supplied from major inte-grators. This comes after years of limited competition for these parts by sole-sourcing components from major suppliers.

“We will work with some other small business contractors to reverse engineer components,” explained Jansson, noting that collected data for some products allows for the introduction of new manufacturers, leading to greater efficiencies. “We have been successful in reducing prices.”

In one recent case, he said, competi-tion surrounding FA-18 rewiring provided an approximately 20 percent reduction in prices from newly contracted alternative sources.

“We have saved $26 million for items put on long-term contracts, reducing lead times, and by increased competition,” he said.

Even with the move toward more competition for part supplying, DLA Avia-tion appears to remain committed to the major traditional sole source parts provider. Recently, the agency awarded contracts to several prime suppliers for structural

components by whittling down those seek-ing contracts to four prime military con-tractors under a competition to provide around 2,000 parts for primarily Air Force use. One portion of that effort allows for several suppliers to provide landing gear collectively, providing $37 million in sav-ings over the previous sole-sourced vendor contract.

But military part procurement contract-ing is not the sole purview of major manu-facturers or smaller firms who can replicate parts in their place. Memphis, Tenn.-based Inventory Locator Service LLC was founded in 1979 with the aim of matching buyers and sellers of aviation parts and ground sup-port equipment.

John Angelbeck, senior manager, defense solutions for the firm, said that their proprietary searchable database allows people to input commercial part numbers or a keyword to find all the supplies listed in their database. The database provides infor-mation including the number of parts avail-able from an individual supplier, whether it is new or overhauled, and the plane from which it was removed. The database also shows whether the potential supplier is gov-ernment certified so it can easily do busi-ness and meet DLA shipping specifications. Also listed is government cross reference information to allow for more sourcing options when parts are used in more than one type of military aircraft.

Represented in about 115 countries worldwide, Angelbeck said the com-pany “works heavily” with DLA Aviation,

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providing over 75 million lines of inven-tory in their database with 14,000 parts searched for on a daily basis. For govern-ment use specifically, the firm lists about 13 million items of both active and histori-cal use.

“ILS assists DLA in providing them a global asset view of available parts,” said Angelbeck. “We deal with a lot of MICAP (mission impaired capability awaiting parts) situations, incapable aircraft that they need a part for to get it back into ser-vice. We assist them with identifying the parts so they can get it in house and help the warfighter.”

He added that the company sees even greater opportunities with DLA in light of the recent update to the 2012 Direc-tor’s Guidance, which he said places an “emphasis on shifting industry capabili-ties” in light of the tightening DoD budget situation, coming Afghanistan drawdown and other factors.

“One of the things at the top of their list is viewing information as the most cost-effective means to overcome the per-ceived cost shortfall,” said Angelbeck.

data advancing efficiency

With procurement cost and delivery timing a central focus of DLA Aviation’s operations, data management and other technological advances are a key compo-nent to ensuring both. Pratt & Whitney’s Mitchell noted that in support of the con-tract, the company has developed a sophis-ticated forecast modeling tool and process that the Air Force has cited as a best prac-tices effort. She said these “value stream” enhancements are being worked as part of a collaborative forecasting process for aviation supply deliverables, adding that the company is currently working with DLA Aviation and Air Force Global Logis-tics Support Center and industry peers on further improvements in this area.

“That’s really one of the most signifi-cant initiatives we as industry are working on with the DLA, to come up with a better forecasting process that will produce a more accurate and stable demand signal that we can reliably execute, resulting in 100 percent on-time delivery to customer need,” said Mitchell.

According to ILS’s Angelbeck, his firm not only connects DLA with needed parts, but also forecasts future demand for a par-ticular part based on historical data and

historic pricing information, which helps any purchaser with the bottom line.

ILS’s market intelligence group devel-ops 12-month predictions for the expected supply and demand on a particular part, data that is linked to the broader availabil-ity data, providing government contractor information that includes pricing history for negotiation purposes.

“They have a base line to go out and procure that part,” Angelbeck said.

Outside of suppliers to the agency and those who connect the two, another component of the DLA supply chain is the firms that do repair work on military aircraft.

Dan Gonzales, vice president of busi-ness development for government and military sector at Tempe, Ariz.-based Stan-dardAero, said that while the aviation overhaul firm has other arrangements in place should it not be able to get materials through the agency, it relies on DLA to provide parts for many of its operations.

“One of the benefits of working with DLA is that they are a very steady supplier of parts,” said Gonzales.

StandardAero does depot work for the Air Force, Navy and Coast Guard, which totals 30-35 percent of their $1.5 billion in annual revenue, said Gonzales. Their largest workload portion is managing the overhaul of the C-130 supply plane’s T56 turboprop engines, which they have been doing at the former Kelley Air Force base since 1999.

Randal Herrington, director of materi-als for the StandardAero’s T56 operations, said DLA is good at ensuring the opera-tion’s steady part demands are met using their forecast data.

“That is certainly how we work best with the DLA,” said Herrington.

Gonzales said that one of the ways they ensure this is effective is to collect real time data, evaluated and calculated nightly to feed their forward supply pro-jections. He added that they’ve also come to count on regularly scheduled meetings with DLA as part of their work with the agency to ensure efficiency.

Advances in procurement model-ing are also leading to further potential logistics advancement. Gonzales said that StandardAero is developing a model that would anticipate when engine part failures will occur in the field in anticipation of demand patterns for the DLA to reduce down times for broken engines.

Pratt & Whitney’s Mitchell also pointed to discussions about the use of performance-based logistics contracts as a possible means of improving logistics outcomes, although she said that these types of contracts are typically led by the Air Force, as they own system level perfor-mance and DLA is not responsible for met-rics at the operational level. This points to DLA’s integral but in some ways limited role in the overall military procurement process.

“I think there is still some confusion about role of DLA in PBLs,” she said, adding that industry and government are trying to figure out what DLA’s actual responsibility would be under such a con-tract.

Even as DLA Aviation and its part-ners take advantage of the latest data-driven technology and analysis, the agency continues to look forward to other ways in which it can improve the aviation sup-ply procurement process for the armed services, its industry partners and the taxpayer.

ILS’s Angelbeck said that a major topic within the aviation supply industry cur-rently is counterfeit parts and how to ensure they don’t get onto planes. One of the ways ILS seeks to address the issue is traceability of part history within its database.

“One of the things that is important to DLA and industry is traceability,” said Angelbeck. “They want to have the routing going back to the manufacturer. One of the things we are working on with the DLA is traceability within our database. We hope, in the near future, to supply trace-ability and at the least, tag the particular supplier.”

DLA’s Jansson said that the agency is looking to take traceability even further, utilizing the latest in individual part track-ing technology.

“DLA, overall, is working on new tech-nology to try and help mitigate the risk of counterfeit parts using biological DNA to stamp electronic components for example, to ensure as counterfeit parts aren’t enter-ing the supply chain.” O


at www.mlf-kmi.com.


With nearly $15 billion in sales projected for this fiscal year, the Defense Logistics Agency’s Troop Support would rank in the top third of the Fortune 500. However, it operates under conditions and constraints that similarly sized private companies don’t. For one thing, some of its customers work in war zones. For another, certain products it buys have to be made wholly within the United States.

Nonetheless, this Philadelphia-based arm of the DLA has applied commercial tech-niques and technology, including local sourc-ing and just-in-time delivery, to save tens of millions of dollars annually. The goal is to save an additional $252 million over the next five years. This is being done while improving the quality of foodstuffs, medical supplies, construction equipment and clothing, as a look at each of these areas shows.

meaLs, ready-to-eat and otherwise

A recent example of such an improve-ment comes from DLA Troop Support’s Subsistence Directorate, which in March established a second Afghanistan distribution center in Helmand province. This reduced perishable food transportation time by two to four days for each shipment, which average 3,750 a month.

“What we try to do is purchase as much locally to cut down on the transportation costs,” said Rich Faso, director of subsistence customer operations. “For instance, we’ve got two very good sources of bottled water right in Afghanistan that we purchase from.”

Having local sources helps overcome supply chain problems, such as those that have arisen due to the closing of land routes through Pakistan. In addition to saving money and time, this approach injects funds into the local economy.

The local sources are inspected and approved by U.S. Army Public Health Com-mand. Quality controls are also written into vendor contracts.

The Supreme Group USA of Reston, Va., is the prime food services vendor in Afghani-stan. Supreme financed, designed, built and manages the Helmand regional distribu-tion site, said Mick Schuster, the company’s managing director for logistics. Self-con-tained, the plant has warehouses and bulk fuel installations, as well as its own security arrangements, water purification and sewage treatment plant. It represents an investment of $110 million.

“Supreme made a commercial decision to establish ‘regional distribution centers’ to facilitate improvements in supply chain per-formance with product stored closer to point of consumption on military bases, thereby reducing risk and enhancing service to the warfighter,” Schuster said.

It helps that the company has been oper-ating in challenging environments for more than 50 years. However, each theater of oper-ation is unique. For instance, in Afghanistan, there’s a lack of transportation infrastructure, severe weather conditions, mountains and deserts, as well as security threats. Supreme has to provide tailored solutions and be flex-ible, Schuster noted.

In addition to frozen, dried and other commercially standard foodstuffs, DLA’s Faso noted that the Subsistence Directorate also procures some warfighter-specific items, like MREs. Meals-ready-to-eat have a long shelf life, are fully cooked and ready to serve.

No matter what the foodstuff, DLA Troop Support must deal with a long supply line and overcome possible disruptions. Hence, it maintains a 60-day inventory along the supply chain. That’s a substantial amount of material, considering that some 40 shipping containers are needed a day just to feed those serving in

Afghanistan. This inventory approach is not used within CONUS, as the commercial infra-structure and supply chain in the continental U.S. can handle disruptions.

As for the future, one possibility being investigated is for DLA Troop Support to go a step beyond food delivery and move into its preparation. Today, that is handled by the military services themselves, Faso said. “To take over that responsibility, we’ll have to show a good cost savings, not only for them but the government as a whole.”

suppLying pharmaceuticaLs and more

DLA Troop Support’s Medical Directorate purchases drugs, medical supplies and equip-ment, with the last including such high-dollar items as MRI imagers, CT scanners and the IT that manages the images produced. For the most part, this is done with only about a 20th of the inventory stored in depots, said Don Buchwald, director of customer operations for the Medical Directorate.

The reliance on commercial vendors and the use of just-in-time delivery has to be adjusted a bit, due to the need to be ready for the unexpected. For example, there may be a sudden surge in demand due to a disaster or the outbreak of hostilities, but that possibility has been planned for.

“At the cost of $24 million a year, we’re able to get guaranteed access to $778 million worth of material,” Buchwald said.

Areas with a robust supply chain and good transportation infrastructure typically operate on an ‘order today, get it tomorrow’ schedule. One challenge is the sheer num-ber of items and the fact that some require special handling, such as refrigeration or the avoidance of heat en route. The latter is handled through the use of temperature monitors and other technology.

at dLa troop support, cots techniques save money.

By hank hogan

mLf correspondent

For the Troops



at www.mlf-kmi.com.

Some items, like flu vaccines, have a lim-ited shelf life and must reach every base and ship annually within a strict time window. Others, such as CT scanners, need to go into buildings before all the walls are in place, as these may prevent installation.

One cost-saving strategy being pursued involves lining up supplies of generic drugs as replacements to name brands as soon as this becomes possible, Buchwald said. Another is the development of an integrated operating room, which is intended to save both time and money in setting up such facilities.

Larry Stepp is vice president of national accounts for the government division of Chesterbrook, Pa.-based AmerisourceBergen, a prime pharmacy vendor for DLA Troop Support. The company offers a 24-hour turn-around on any product that it carries, with the contract measuring performance by deliv-ery against what’s ordered over a specified period. Those service levels are 98 percent or higher, leading to greater supply chain efficiency, Stepp said.

One of the changes that he sees on the horizon is the greater use of electronic order-ing. Another involves track-and-trace bar code initiatives that will support supply chain data and integrity. Pharmaceuticals and med-ical supplies also have pedigree requirements, mandating that additional information be in the bar code.

“That’s all the way down to lot numbers and things like that. That’s what I think the future is. The manufacturers will begin to provide more of that data in their bar codes on the actual products,” Stepp said.

more than construction equipment

DLA Troop Support’s Construction and Equipment Directorate handles perhaps the largest and most diverse array of goods of any of the directorates. The list includes light-ing, metals, lumber, firefighting equipment, materials handling and special operations equipment.

“We do some lighting type items. We do heavy equipment,” summarized Tony D’Ambrosio, deputy director of construction and equipment at DLA Troop Support. “We have a full range of items. They range from light bulbs to bulldozers.”

Commodity items are handled via a just-in-time delivery system. For others, a cat-egory that includes heavy equipment, that’s not really possible. In all cases, procurement is handled via contracts that have been set up,

with customers ordering items against those contracts.

SAIC of McLean, Va., is one vendor responding to those customer orders. It does so under an integrated prime vendor pro-gram, as well as a maintenance, repair and operations tailored logistics support program.

John Ptakowski is division manager for SAIC’s prime vendor program, which he said handles over 36,000 unique stock numbers. These are used to fill over 99,000 bins at three fleet readiness centers, where technicians repair and refurbish helicopters and other assets.

“The requirement that we have as a con-tractor is to keep those bins filled so that the mechanics do not stop their job for a lack of supply parts,” he said.

The bin fill rate is currently over 99 per-cent, several points higher than called for in the contract.

As for the tailored logistics support pro-gram, some 250,000 individual line items go through it a year, said Christian Frye, prime vendor maintenance repair and opera-tions division manager. SAIC can handle this thanks to its procurement professionals, an IT backend that can handle the load, a nimble response to what can be a rapidly chang-ing situation, and enhanced customer facing technology.

“We provide a web interface to the indi-vidual customer so they can come to use with their individual requirements as they are needed. Some things are planned because they’re going to do some expansion. Many things are not planned; that’s where things can break down without the right level of support,” Frye said.

Another equipment supplier is ADS of Virginia Beach, Va. Jack Pellicci, DLA sales manager, said the company leverages its buy-ing power and implements commercial prac-tices to generate savings. These are then passed along to the government, something that Pellicci is happy to see.

“We’re very, very proud to provide these services and cost savings to the government to ensure that our warfighters are getting the latest and greatest equipment that they need,” he said.

the cLothes on their Back

The final DLA Troop Support supply chain involves clothing and textiles. This cov-ers everything from utility uniforms, helmets, body armor and boots to dress uniforms, backpacks, tents and sleeping bags, said Gary

Colello, director of customer operations for the Clothing and Textiles Directorate.

Unlike the other supply chains, this one cannot use just-in-time delivery system and must stockpile items in depots, in part due to the Berry Amendment. That requires that all of the clothing and textiles products be domestically sourced. At the same time, they have to be made to detailed and restrictive military specifications. As a result, there is a small industrial base to support the war-fighter, with only one wool manufacturer in the U.S., for instance. There are only four companies that produce the fabric used in camouflage uniforms.

Dealing with this situation mandates that the demand be closely monitored, which is done by tracking the number of incom-ing recruits. There’s also an online ordering system that picks up the demand signal from those already in the military.

This information then is constantly com-municated to the vendors, who may have only one customer for the products, Colello said. “They need to plan in advance. You can work your way all the way back through the sup-ply chain to ensure there’s enough coming through but not too much.”

Some clothing and textile items change very slowly. Others have been undergoing a rapid evolution, with such being the case for body armor. One supplier of such gear is BAE Systems, which in March was awarded a four-year contract to produce tactical vests equipped with soft body armor. These are pro-duced at the company’s Jessup, Pa., facility.

In discussing future directions in this type of technology, Eric Gavelda, program director for warfighter protection at BAE Systems, noted that there is an open solicita-tion out for an advanced combat helmet. The spec includes a weight reduction, with the aim of shaving as much as 10 percent weight off when compared to past helmets. That sort of advance is now typical of what DLA Troop Support attempts to do in modernizing through sustainment.

As Gavelda said, “It almost always focuses on those two items: weight reduction or increased capability.” O


at www.mlf-kmi.com.


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Dan KeefeExecutive Vice President and Group General Manager

ManTech Technical Services GroupDan Keefe is executive vice president

and group general manager for Man-Tech’s Technical Services Group. Keefe is a retired U.S. Army brigadier general whose career highlights included service as com-manding general of U.S. forces in Kosovo and V Corps chief of staff during Operation Iraqi Freedom.

Q: Let’s start with some background on ManTech. What does ManTech do and how does the company contribute to the DoD logistics mission?

A: ManTech provides innovative technol-ogies and solutions for mission-critical national security programs. Founded in 1968, ManTech has almost 10,000 employ-ees, with 2011 revenues of $3 billion. In addition to the Department of Defense, our customers include the intelligence com-munity; departments of State, Homeland Security and Justice; the space commu-nity; and other U.S. federal government customers. Logistics and global supply chain management are at the core of many of our offerings.

We also provide C4ISR life cycle sup-port, cyber, IT modernization and sus-tainment, intelligence, counterintelligence support, systems engineering, and test and evaluation services. We support our gov-ernment in major missions, such as mili-tary readiness, terrorist threat detection, information security and border protec-tion. For example, we support technology modernization and network operations for the State Department at all U.S. embassies. We also support NATO worldwide, particu-larly in-theater.

ManTech goes where our customers go. We help them meet their missions anytime, anywhere, with about 2,000 staff members overseas supporting our cus-tomers’ vital missions. In fact, most of ManTech’s overseas staff works side-by-side with U.S. forces in Afghanistan and Kuwait on logistics, supply chain management and systems readiness programs.

Q: As a major player in the military logis-tics arena, how is ManTech helping DoD meet current key logistics objectives?

A: For more than 20 years, ManTech has provided core logistics services worldwide. Among these are warehousing, logistics management, property management, ship-ping and receiving, repair and maintenance, unique system training and fielding sup-port, resource management, and inventory tracking for customer systems in deployed, isolated and remote locations. We main-tain life-sustaining operational readiness for counter-improvised explosive device vehi-cles and systems, including mine resistant ambush protected vehicles, MRAP all-ter-rain vehicles and route-clearance vehicles, predominantly in Afghanistan. We began our support for the MRAP family of vehicles in 2003 and have expanded our services over the years to meet operational requirements. We’ve supported the U.S. Army TACOM and its unique customers with sustainment and maintenance; through our supply chain effectiveness efforts, we’re providing people and parts so we can meet our customers’ stringent readiness needs.

One of our teams is responsible for maintaining the Army’s array of elevated sensors in Afghanistan at the highest opera-tional availability rate possible. Recently, the team achieved an operational avail-ability rate of 99 percent, the highest ever achieved over the life of the program. The team accomplished this while lowering pro-gram costs 40 percent and at the same time having the quantity of supported systems grow over 70 percent. We realized this level of efficiency by optimizing the logistics labor force, aligning technicians and spares with transportation lines, adjusting autho-rized stock levels based on historical expe-rience, leveraging the gamut of shipping vendors, and streamlining routine logistical and supply processes.

Because we work side-by-side with military personnel on these programs, we get an up-close view of the support our

customer needs from us. We see each day that the work we do is an essential part of the military’s effort to reduce casualties and improve personnel survivability.

Q: What are some of the main challenges you are facing in meeting the needs of the 21st-century warfighter?

A: We see the need for a fuller range of services support in a more efficient deliv-ery model. With our in-theater support of logistics and materiel readiness, we also provide services in cybersecurity and C4ISR, particularly around border man-agement, real-time visualization of the environment and sensors.

Our approach significantly increased readiness while driving efficiencies and lowering the cost to the customer. These are the systems our warfighters depend on, so it’s essential that they get compre-hensive and consistent support. We also see a high demand for modernization to enhance the efficiencies of IT investments and extend the life of IT systems—another way to not only improve the usefulness of the system, but to reduce the cost of capital for the military.

Program execution is essential—we have to support the warfighter and the mission—but so is efficiency. Our custom-ers are facing pressure to do more with less, and we continually help them meet those demands. Efficiency is about man-aging the business in its entirety while ensuring mission integrity. We know how to keep costs down by hiring the right people, training them and empowering them to be effective in the work they do for our customers. The best qualified worker also is often the most cost-effective, and that’s why cross training is a smart invest-ment. The one person, one job approach gives some immediate efficiency, but for us, it makes more sense to have people who can fit smartly into a broad range of mission-critical logistics and supply chain processes. It keeps vital missions running effectively for our customer and has the added benefit of providing career develop-ment and advancement opportunities for our people. O

INDUSTRY INTERVIEW Military Logistics Forum


The U.S. military needs reliable operational availability at a low life-cycle cost.

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