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the linkAustrAliAn defence logistics mAgAzine
Signing of New Global Freight Contract
Joint logistics Command leads the Way Towards Transitioning Out the AO
effective Collaboration: Alignment, Trust and Information
Sharing in Collaborative Supply Chain Management
the link
AustrAliAn defence logistics mAgAzine is a professional logistics journal published twice annually in hard copy and online by Joint logistics command.
its objectives are:
• Topublisharticlesinengaging,non-technicallanguagethataddtothelogisticsbodyofknowledge,andenhancetheprofessionoflogisticsandtheimageoflogisticians;
• ToinformtheDefenceandwidercommunityofthestrategicroleandscopeoflogisticsinsupportingoperationsandtheraise,train,sustainfunctionsoftheAustralianDefenceForce;
• TohighlightadvancesandachievementsinDefencelogistics;and
• TosupporttheprogramoflogisticsreformintheAustralianDefenceOrganisation.
SubmissionsforThe Linkaremostwelcome.Writers’guidelinesareontheJointLogisticsCommandintranetsiteorcanberequestedfromtheeditor.
TheviewsexpressedinThe LinkarethecontributorsandnotnecessarilythoseofJointLogisticsCommandortheDepartmentofDefence.
MrsPatriciaCliffordEditor,The Link
POBox7913CANBERRABCACT2610
E-mail:JLC.Communications@defence.gov.au
the linkAustrAliAn defence logistics mAgAzine
AustrAliAn defence logistics mAgAzine 1
IwelcomeyoutotheJune2013editionofThe Link.InthisissuewefocusonLogisticsreformandtransformation,andsupporttooperationsincludingforwardandreversesupplychains.
LogisticsunderpinsalltheAustralianDefenceForceachievesinoperationsathomeandoverseas.In2013,supportingoperationsis,asalways,theCommand’snumberonepriority.Thisincludesensuringthatnationalsupportbaseinfrastructurecontinuestoenable,supportandenhanceoperations,andassistanceintheplanningandimplementationofAustralia’sdrawdownofpersonnelandequipmentfromAfghanistan.
ThearticlescontributedforthisissueofThe LinkhaveagainremindedmeoftherangeoftalentedandintelligentpersonnelatalllevelswithintheAustralianDefenceOrganisation.Ourfeaturearticleisathoughtprovoking(andsomemightevensuggestcontroversial)analysisofthepotentialbenefitsofTechnicalRefreshmentandEvolutionaryAcquisitionofLandMaterielwrittenbyLTCOLBandLTCOLCfromSpecialOperationsCommand.
LEUTCameronMathesonhasprovidedaninsightfularticleonJointLogisticsCommand’skeyinvolvementintransitioningoutofAO.JayneMelling’sarticleoutlinestheincreaseinlogisticslearningoptionssoontobeavailableonDefence’snewlearningsolution,Campus Anywhere,providinguserswiththeabilitytoaccessup-todatelogisticstrainingevenwhendeployedoverseas.
WGCDRNeilCollie’sarticlediscusestheimportanceofeffectivecollaborationinsupplychainmanagement,andDavidClarkeprovidesdetailsontheNationalAssetandInventorySample.Withthe20December2012signingoftheGlobalFreightForwardingandCustoms
ClearanceServicescontractwithDHL,PhillipFrancis’timelyarticleprovidesfurtherdetailsonacontractwhichwilldelivermoreefficientlogisticsupportservicestoDefence.
IwouldliketothanktheauthorsfortheircontributiontowhatIbelieveisanotherthoughtprovokingissueofThe Link.IencourageyoutoreadtheeleventheditionofThe Link,andwelcomeyourcontributionsandthoughtsforfutureissues.
Regards,
Rear Admiral Clint Thomas, AM, CSC, RANCommanderJointLogistics
AustrAliAn Defence logistics MAgAzine 3
ContentS
loGiStiCS leARninG OPTIONS INCREASED 4
eFFeCtiVe CollABoRAtion: ALIGNMENT, TRUST AND INFORMATION SHARING IN COLLABORATIVE SUPPLY CHAIN MANAGEMENT 5
SIGNING OF NEW GloBAl FReiGht ContRACt 8
Joint loGiStiCS CoMMAnD leADS the WAY TOWARDS TRANSITIONING OUT OF THE AO 10
nAtionAl ASSet AND INVENTORY SAMPLE 13
the FoRGotten link 16
AN ESSAY ON teChniCAl ReFReShMent AnD eVolUtionARY ACQUiSition oF lAnD MAteRiel 17 8
5
13
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LogisticstrainingwillformakeypartoftheDefence-specifictrainingavailableviathenewlearningsolution,Campus Anywhere.
Campus AnywhereisanunclassifiedversionofCampusthatwillallowpeoplefromtheDefencecommunitytoaccesscorporate,web-basedtrainingwhennotconnectedtotheDefenceRestrictedNetwork(DRN).
JointLogisticsCommandhasreviewedtheLogisticse-learnsuiteofcourses,ensuringtheyareappropriateforanunclassifiedtrainingenvironment.
FourofthecorefoundationlogisticscoursesarecurrentlyavailableonCampusandviaCampus Anywhere.Thesecoursesare:CoalitionLogisticsEducationPackage;IntroductoryModuleonLogisticsinDefence;LogisticsSupporttoCapability;andLogisticsSupporttoOperations.
Additionally,arecentlyreleasedlogisticse-learnproduct,theADFSupplyChain,willbeaddedtoCampusAnywherein2013.CommanderJointLogistics(CJLOG),RADMClintThomas,commissionedthise-learnproducthavingrecognisedtheimportanceofthesupplychaininenablingoperationalsuccess.HealsoendorsedthereleaseofCampus Anywhere,recognisingthebenefitsthatcomefromhavingonlinelogisticstrainingavailabletouserswithoutDRNaccess.
loGiStiCS leARninG OPTIONS INCREASEDJayne MellingVCDFG & HQJOC Learning Business Partner Defence Learning Branch Vice Chief of the Defence Force Group
CJLOGstated,‘Theabilitytoprovideup-todatelogisticstraining,andtheabilityforeasyaccesstorefreshandrevise,isimportantfordeployedpersonnel’.Forexample,personnelalreadyin-situoverseaswillbeabletoaccessthisnewlogisticstrainingpackagewhenitisreleasedtoCampus Anywhere.
Asshowninthetablebelow,therewere860completionsacrossthesefourlogisticscoursesavailableviaCampusin2012.CompletionsareexpectedtoincreaseonceCampus Anywhereisoperational,anditwillbeeasierformemberstoaccessthiskeytraining.
AccesstoCampus AnywherewillberolledoutgraduallyacrossDefenceduring2013.Reservememberswillbetargetedinitially,andothermemberswillsubsequentlybeabletoregistertheirinterestandbeallocatedanaccount.UpdatesandfurtherinformationonCampus AnywherecanbefoundontheDefenceintranetathttp://intranet.defence.gov.au/vcdf/sites/LearningSolutions/ComWeb.asp?Page=91462
Name PMKeyS2012 completions(sourcedfromCampus)
CoalitionLogisticsEducationPackage 209788 133
IntroductoryModuleonLogisticsinDefence 202745 495
LogisticsSupporttoCapability 206366 134
LogisticsSupporttoOperations 204557 98
860 total
AustrAliAn Defence logistics MAgAzine 5
eFFeCtiVe CollABoRAtion: ALIGNMENT, TRUST AND INFORMATION SHARING IN COLLABORATIVE SUPPLY CHAIN MANAGEMENTWGCDR n.R. CollieCommanding Officer Joint Logistics Unit (South) Joint Logistics Command
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IntroductionStudiesconductedin2004concludedthat
thesupplychainofthefuturewouldneedto
demonstratethreecharacteristics;synthesis,
velocity,andcollaboration.Thisarticlewill
confineitselftoadiscussionastothenatureof
effectivecollaborationanditsrelevancetothe
contractualrelationshipsthatexist,orwillsoon
exist,inJointLogisticsCommand(JLC).
JLCwillenterintonewWarehousingand
Distribution(W&D)andLandMateriel
Maintenance(LMM)LogisticsServices
Contractsin2013.Theintentionisthenew
businesspartnershipthatwillexistbetweenJLC
andthecontractorwillbebasedonprinciplesof
collaboration.
The Nature of Collaborative Supply Chain ManagementCollaboration,itisargued,isachievedthrough
properapplicationoftechnologyandtrue
partnerships.Technologyisclearlyofgreat
importanceinprovidingthelinkagesrequired
forsupplychainstakeholderstocollaborate,
however,itiswiththehumandimensionof
collaborativeSupplyChainManagement
(SCM)—howthestakeholderswithinthe
collaborativeSCMpartnershipbehavetowards
eachother—thatweareconcerned.
Ofthedistinguishingfeaturesofa‘true
partnership’inproperlycollaborativeSCM,three
standout:trueunderstandingandalignment
withapartners’business;commitmenttolong-
termrelationshipsbasedontrust;andbeliefin
sharinginformation.
Alignment in Collaborative SCMAlignmentofallthestakeholdersinthesupply
chainallowseachstakeholdertomaximise
theirowninterests,whilstoptimisingthe
supplychainasawhole.Inasituationwhere
expectationsarepoorlyaligned,therisks
oftherelationshipquicklyencountering
problemsimmediatelyafterthepost-signature
honeymoonperiodarehigh.Atworstthese
problemsmightde-generatetoapointwhere
severecompromiseorcatastrophicbreakdown
ofthepartnershipoccurs.
Theconditionofalignmentthenisakey
featureinthesuccessofcollaborativeSCM.It
isachievedbyplacingemphasisontwoareas
ofthepre-signaturecontractnegotiation,
clarificationandalignmentofstakeholder
roles,andresponsibilitiesandalignmentof
stakeholderincentives.Intheinitialstagesofa
collaborativeSCMrelationship,therequirement
toclarifyandalignrolesandresponsibilities
demandsthatthoserolesandresponsibilities
aredrawnfromcompatibleobjectives.
Alignmentduringthiskeyperiodmayoften
bethreatenedbydifferentperceptionsofhow
thegoalsshouldbeachieved.Significanteffort
mustbeexpendedup-frontindeterminingand
mutuallyclarifyingthosecompatiblebusiness
objectivesorgoals,andestablishingand
clarifyingclearincentivesforallpartieswhere
roles,responsibilities,rewardsandremuneration
detailsarecompletelyunderstood.
DeterminationandalignmentofbothJLC’sand
thecontractor’sgoalsandbusinessobjectives
duringfinalcontractnegotiationsforthenew
LogisticsServicescontractswillbecrucialin
thisregard,andshoulddemandaconsiderable
amountofattentionfromcontractnegotiators.
Onlyfromthisfoundationalbaselinecantrust
begintodevelopasanecessarypartofthe
collaboration.
Trust in Collaborative SCMTrustisrecognisedasacharacteristicrequired
inanysuccessfulrelationship,andtrustis
thekeycharacteristicrequiredtopromote
collaborativebehaviourwithinamutually
beneficialandalignedbusinesspartnership.
Thedevelopmentoftrustmustcomefirstinthe
newcontractualarrangementasaprecursorto
informationsharing.
Recentresearchsuggeststhatrelationshipand
trustissueswerefoundtobemoreimportant
toeffectiveinformationsharingthansystems
andtechnology,thatface-to-faceinteractions
areessentialforbuildingtrust,andthatnothing
canreplacethisduringtheearlystagesofa
relationship.Thispointonissuesoftrustisof
particularrelevancetoJLCaspreparationsand
negotiationsforthenewcontractingjourney
gatherpace.Theimportanceofmaintaining
andpromotingtheface-to-faceelementof
collaborativerelationshipsatalllevels,from
CommandHQtotheinterplaybetween
membersoftheJLCBusinessUnits(BUs)
andcontractorpersonnelonsite,cannotbe
overstated.Significanteffortatalllevelsof
JLCandcontractorenterprisesneedstobe
expendedinbuildingthistrust.Thiscanbe
achievedthroughearlyandqualitydialoguefor
AustrAliAn Defence logistics MAgAzine 7
bothpartiestoachievemutualsuccessesand
toestablishtheleveloftrustandtransparency
neededtofostereffectiveinformationsharing.
Information Sharing in Collaborative SCMGoodqualityinformationsharingin
collaborativeSCMenablesoptimisationofthe
supplychaintoreachfurtherupstreamand
downstreamthanthelimitedlocaloptimisation
thatmightbeavailablewhereinformationflow
ispoor.Sharedinformationencompassesthe
provisionofdemand,inventory,maintenance
andotherlogisticsdatatoallstakeholders.
Whereinformationisoverlyorunnecessarily
protectedanddoesnotflowtowhereitneeds
to,stakeholderswillberestrictedtointernal
andlocalplanningandproblemsolving.Local
orinternalplansmaywellbeinconsistentwith
theplansofotherstakeholdersandsupply
chainvisibilitymaybeseverelycompromised,
leadingtorestrictedsupplychainagilityand
lackofvelocity.Universalknowledgemakes
forfarmoreeffectivejointplanning,problem
solving,supplychainvisibilityandperformance
measurementtooccur.Thiswillresultin
superiorlevelsofintegrationofplansalongthe
supplychain,andhighlevelsofvisibility,agility
andvelocityinthesupplychain.
ConclusionWhilstthetechnologythatwillprovidethe
linkagesnecessaryforsupplychainstakeholders
tocollaborate,itisthehumanor‘soft’aspect
ofeffectivecollaborationthatisofequal,ifnot
superiorimportance.
Therelativenationalandregionalsuccessofthe
newW&DandLMMLogisticsServicesContracts
willdependonthelevelofcommitmentwithin
theJLCBUenvironment,andintheContract
ManagementenvironmentinHQJLCSupply
ChainBranch,toestablishthecriticalconditions
forcollaboration.Earlyworkinthisregardmight
beachievedafterthesuccessfultenderersfor
eachcontracthavebeenannouncedandbefore
thecommencementofbothcontracts.
Effortmustbeexpendedtoalignincentives
duringfinalcontractnegotiations,andestablish
trustthroughfrequent,honestandopen
dialogue.Centraltothisdialogueneedstobea
genuinedeterminationtodevelopandestablish
abasisoftrustwiththenewcontractoratevery
level,fromnationallevelcontractmanagement
tolocallevelservicedelivery.Thisrelationshipneedstobecharacterisedbytransparencymaintainedthrougheffectiveinformationsharingandconsistencyinwordanddeedintothefuture.
ReferencesFawcett, S. E., Magnan, G. M. & McCarter, M. W. (2008). Benefits, Barriers, and Bridges to Effective Supply Chain Management, Supply Chain Management: An International Journal, Vol. 13 No. 1, 35-48.
Klappich, D. (2012) Collaboration, Cloud and Evolving Strategies will Drive Global Logistics in 2013, MHD Supply Chain Solutions, Vol 43 No. 1, 30-32.
Lee, H. L. (2004), The Triple-A Supply Chain. On Point Article for Harvard Business Review, Boston, MA: Harvard Business School Publishing Corporation.
Myhr, N. & Spekman, R. E. (2005). Collaborative Supply-Chain Partnerships Built Upon Trust and Electronically Mediated Exchange. Journal of Business & Industrial Marketing, Vol.20 No. 4/5, 179-186.
O’Byrne, R. (2012) Logistics Outsourcing Tips: A Practical Guide – Part 3, MHD Supply Chain Solutions, Vol 43 No. 1, 34-35.
Sheu, C., Yen, H.R. & Chae, B. (2006).Determinants of Supplier-Retailer Collaboration: Evidence from an International Study.International Journal of Operations & Production Management, Vol. 26 No. 1, 24-49.
Tomasini, R. & Van Wassenhove, L.N. (2009). Humanitarian Logistics. Basingstoke: Palgrave Macmillan.
Tompkins, J.A. (2004). Partnerships in the Supply Chain. In J. A. Tompkins and Harmelink (Ed), The Supply Chain Handbook. Raleigh, NC: Tompkins Press.
Tompkins, J.A (2004). The Supply Chain: Past, Present, and Future. In J. A. Tompkins and Harmelink (Ed), The Supply Chain Handbook. Raleigh, NC: Tompkins Press.
Wisner, J. D., Tan, K. & Leong, G. K. (2008). Principles of Supply Chain Management: A balanced approach. (2nd ed). USA: South-Western Cengage Learning.
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FollowingthereleaseofaRequestforTender(RFT)on5May2012,andsubsequentevaluationandsuccessfulcontractnegotiation,anewcontractfortheProvisionofGlobalFreightForwardingandCustomsClearanceServiceswassignedon20December2012withGlobalForwardingAustralia(DHL).
Thecontractisforaninitialperiodoffouryears,withoptionsforafurtherfouryears,andwillbetheprimarymeanstosupporttheinternationalmovementof:
• goodsprocuredcommerciallyfromitsinternationalsuppliers,
• goodsprocuredthroughtheUSForeignMilitarySales(FMS)program,
• goodsforrepairandreturn,
• Defenceassetsusedtosupportmanufacturingandtesting,and
• Defenceassetsusedtosupportoperationsandexercises.
DHLhaveover30year’sexperienceintheshippingofDefencematerial,andalsoholdscontractswiththeNewZealandDefenceForceandUKMinistryofDefence.DHL’svastglobalnetworkofofficesmakesthemanidealsupplieroftheseservices.
ThecontractwilldelivermoreefficientlogisticsupportservicesbyincorporatingmoreflexiblearrangementswhichallowDefencetotakeadvantageofmarketopportunitiesarisingfromtheverycompetitivenatureofthefreightforwardingbusiness.Thecontractalsointroducesmoreeffectivegovernancearrangementsinordertomitigatecontractualcostsandrisks.
SIGNING OF NEW GloBAl FReiGht ContRACt Phillip FrancisSO1 International Freight Supply Chain Branch Joint Logistics Command
ThesigningofthiscontractextendsDefence’srelationshipwithDHLtoalmost30years,duringwhichthecompanyhassupportedDefenceanditspersonnelonaglobalbasis,providingarangeofservices,includinginternationalairandoceanfreightservices,charterservicesandcustomsclearanceservices.Todate,DHLhassupportedDefenceinover250locationsaroundtheworld,includinglocationssuchasAfghanistan,Angola,IcelandandSudan.DHLhasbeenrequiredtoarrangeforthemovementofDefenceequipmentdirectfromourinternationalsuppliersinNorthAmericaandEuropetoAfghanistanbybothregularcommercialflightsandcharteraircraft.
FollowingcontractsignatureatVictoriaBarracksinMelbourne,BRIGPeterDaniel,DirectorGeneralSupplyChain,commented,‘DHLwasselectedfollowinganopenapproachtotheindustry.DHLwasabletodemonstratetotheprojectteamthattheycoulddeliveranefficientandeffectivefreightforwardingservicetoDefence.TheservicestobeprovidedunderthiscontractareextremelyimportanttoDefenceandwelookforwardtocontinuingthestrongrelationshipwithDHLGlobalForwarding.WeareexcitedabouttheopportunitiesthiscontractwilldelivertoDefence’.
Thenewcontractcameintoeffecton1March2013,andwillbemanagedbyJLC’sInternationalFreightoffice.Whilethemanagementofthiscontractisakeyactivityoftheoffice,theofficealsoprovidesadvicetothewiderDefencecommunityontherangeofissuesrelatedtotheimportandexportofDefencegoods,includingimport/exportlicensing,importtariffsandGSTonimports.
AustrAliAn Defence logistics MAgAzine 9
TheInternationalFreightOfficehasbeenabletoachievesignificantsavingsforDefenceandDMOtominimisedutyliabilityonDefenceimportsbytheuseoftheTariffConcessionschemeandvariousFreeTradeAgreementsbyimplementingbestpracticeintheconsolidationoffreight.TheInternationalFreightOfficeisavailabletoassistDefenceandDMOstaffinminimisingtheirdutyandfreightliabilities.
DefenceisrequiredtocomplywithAustralianlegislationgoverningtheImportation/ExportationofgoodsacrosstheAustralianBordertostreamlinetheimportclearanceofgoods.TheInternationalFreightofficehassuccessfullynegotiatedwithAustralianCustomsandtheAttorney-General’sDepartmenttoobtainon-goingimportapprovalsforweapons,ammunition,explosives(includingImprovisedExplosiveDevice’s)andgeneralwarfareitems.
TheInternationalFreightOfficecanprovideadviceonallimport/exportcontrols.Ifyouhavequestionsorrequireanyinformationonissuesrelatingtotheinternationalmovementoffreight,pleasecontacttheDefenceInternationalFreightOfficeon0392826937oremailado.customs@defence.gov.au
Contract Signing
left to Right Front Row: Mr Phil Lumsden - General Manager NSW DHL, Mr Tony Boll - CEO (South Pacific) DHL, BRIG Peter Daniel - Director General Supply Chain, Mr David Frith - Director Supply Chain Contracts. Back Row: Mr John Walker - Account Manger DHL, Mr Dean Herbert - Director Domestic Contracts, Mr Phillip Francis - Global Freight Contract Manager.
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Joint loGiStiCS CoMMAnD leADS the WAY TOWARDS TRANSITIONING OUT OF THE AO Cameron Matheson leUt, RAn Reverse Supply Chain Supply Chain Branch Joint Logistics Command
AustrAliAn Defence logistics MAgAzine 11
IntroductionThisyearhasseensomesignificantstructure
changesfortheDirectorateofSupplyChain
OperationsandPlans(DSCOP).Regionaland
nonRegionalOperationshastransformedinto
Operations(forwardandreversesupplychain)
andPlans.DSCOPstillmaintainstheprimary
roleofcoordinatingdesignatedlogisticssupport
tocurrentoperations,exercisesandactivities
throughouttheend-to-endoperationalsupply
chain,however,thefocusisshifting.This
transformationhasbeenmadeoutofnecessity
duetothereallocationofOperationalpriorities.
Closingdownortransitioningoperations
designatesastrongeremphasisontheReverse
SupplyChain(RSC)cell,forbothmanning
withinJointLogisticsCommand(JLC)and
deliveringsuitableresourcesincountry(suchas
LiaisonOfficers),toensureadequatecoverage
duringthishightempoperiod.
OP ASTUTEAtthetimeofwriting,theongoingAustralian
DefenceForce(ADF)operationalsupportfor
stabilisationandsecurityoperationswasdueto
concludeinApril2013.Logisticallyspeaking,
thiscouldbeconsideredasmalleroperationdue
tothequantitiesinvolvedandlocationrelativeto
Australia.Therefore,thishasprovidedaunique
opportunitytotrialseveralnewinitiatives,
includingGlobalPositioningSystemtagtrialand
directfreightforwardingtotheenddestination.
ThefirsttrialwasbasedontheRadioFrequency
Identification(RFID)system,currentlywell
establishedwithintheSupplyChain.Withthe
keylimitationidentifiedasthelevelofcoverage
duringtransitsituations,theconceptwasto
‘leaders win through logistics. Vision, sure. Strategy, yes. But when you go to war, you need to have both toilet paper and bullets at the right place at the right time. in other words, you must win through superior logistics.’
Tom Peters - Rule #3: Leadership Is Confusing As Hell, Fast Company, March 2001
utiliseGPStransponderstopinpointlocationof
cargo,facilitatingefficiencygainstosupporting
agencies.Timelyandaccurateinformationon
thestatusandlocationofstockinthesupply
chainresultsinahigherlevelofefficiencyin
preparednesstoreceipttheitemswithinports
andBusinessUnits(BU).
Thesecondtrialinvolvedfreightforwarding
totheendlocation.Itrequiresahigherlevel
ofplanning,followedbydeliberatestuffingof
thecontainersdirectlyforthePrimaryStorage
Unit(PSU),i.e.JLCBU.Allcontainersarethen
transportedtoamajorshippinghub(inthis
caseviaSingapore)beforebeingpushedto
thePSU’sclosestport(Brisbane,Melbourneor
Sydney)forconsolidationintothestoressystem.
Thisprocesshastheaddedpositiveresultof
reducingtheprocessingburdenofCustoms
andDepartmentofAgriculture,Fisheriesand
ForestryBiosecurity(DDAFF-B),andreduces
thecosttoDefenceintheformofstorage,
lengthoftimecontainersarehired,lengthof
timeitemsareunavailableforissue,etc.
OP ANODE WiththeADFcontributiontotheAustralian-
ledRegionalAssistanceMissiontoSolomon
Islands(RAMSI)comingtoaclose,planning
iswellunderwayforextraction.Withdrawal
willcontinuethroughtoJune2013,afterwhich
timeequipmentwillberepatriated,bases
closedandpropertyandbuildingsreturned
totheGovernmentofSolomonIslands.Both
HQJointOperationsCommand(JOC)and
JLCarewellpositionedfromtherecentOP
ASTUTEdrawdowntobuildonlessonslearntto
effectivelyreturnequipmentandpersonnel.
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Theconsiderablequantityofequipmenttobe
RTAalsopresentsnewchallenges.Howdo
werelocatehundredsofshippingcontainers
andvehicles?Whatisthemostcosteffective
waytohiretheshippingcontainers?Arethey
certifiedforseamovement?Dotheintheatre
humanresourceshavethecapacitytoundertake
theassignedworkloadinthedesignatedtime
frame?Canthecontainersbemoveddirectlyto
enddestination,enablinglessmovementusing
theDefenceIntegratedDistributionSystem
uponRTA?Whatisthebest(consideringtime
andvalue)optionfortransporting?When
thecontainersarriveinAustralia,atwhatrate
canthecontainersbeprocessed?Itisclear
thatextensivecoordinationbymanyvaried
AustralianDefenceOrganisationswillbe
requiredtosuccessfullywithdrawfromthe
MEAO.
SummaryWhileJLCcontinuestoprovidehighlevelsof
customerdrivenservicetosustaintheforce,it
isclearthatJLChasplayedandwillcontinue
toplayasignificantroleinthesuccessful
drawdownandclosureofthreeverydifferent
andgeographicallydispersedOperations.
Lookingforward,extensiveplanningand
positioningofpersonnelwillensurethat
therestockingofthePrimaryStorageUnits
readyforsubsequenttaskingissuccessful–
maintainingthetoiletpaperandbulletsinthe
rightplaceattherighttime.
OP SLIPPER On12December2011,theMinisterforDefence
announcedaboosttoForceProtectionfor
troopsdeployedtoAfghanistan.Thisinvolved
theupgradeofProtectedMobilityVehicles
(PMV)toProductionPeriod4,andtheir
subsequentdeliveryintotheatreduring2012.
TherotationoftheupgradedPMVsinto
theatre,incorporationintoserviceandthe
extractionofthesupersededPMVsrequired
multi-agencysupportofwhichJLCwasa
significantcontributor.Thisrangedfrom
liaisonwithDefenceMaterialOrganisation
forscheduleupdates,tokeepingallagencies
informedofthePMVdeliveryschedule.JLC
BUshaveworkedcloselywithHQ1JMOVGPto
ensurethatPMVsarepresentedandreadyfor
shipmentinaccordancewiththemovement
plan.CoordinationbetweenJLC’sDirectorate
ofSupplyChainContractingOperational
ContractsandDAFF-Bhasbeencriticalto
thesmoothmovementofvehiclesthusfar.
Cleaningrequirements,subsequentinspection
andclearanceofvehiclespriortodeparture
fromtheatreandagainuponreturntothe
NationalSupportBasewithinAustraliahastaken
significanteffortfrommanyagencies.The
successfulrotationofthePMVfleetintothe
MiddleEastAreaofOperations(MEAO)fully
demonstratedthelevelofcommitmentand
professionalismthatJLCprovidestoAustralian
deployedforces.
PlansarewellunderwaytoReturnToAustralia
(RTA)thesignificantamountofequipmentand
personnelwithintheMEAO.Asoperations
arereducedorreassigned,considerableeffort
isgoingintotheprocessofdecidingwhere
andwhatADFassetsareneeded.Equipment
thatistobedisposedofincountryneeds
tobeidentified,locallynegotiated(attimes
internationalpartiesareinvolved),permission
soughtandthenadministeredtodisposal.
AustrAliAn Defence logistics MAgAzine 13
On4February2013,thefirstcountsoftheNationalAssetandInventorySample(NAIS)commencedattheBAESystemscontactorfacilitieslocatedatMawsonLakes,SouthAustralia.Overthenextfivemonths,4,069stockcodeswillbesampled,inbothWarehousesandSupplyCustomerAccounts,across83Defenceunitsandcontractorsites.Theselectedsamplewillrepresent15.6%byvalueofDefence’sMilitaryIntegratedLogisticsInformationSystem(MILIS)manageditems.
BACKGROUNDManagedbytheLogisticsAssuranceBranch(LAB)withinJointLogisticsCommand(JLC),theNAISisnowawellestablished,keylogisticsassurancetaskforDefence.ItenablesDefencetousestatisticalsamplingtoverify,adjustandsubstantiateourinventorymanagementrecordsandfinancialstatementsforMILISmanageditems.ItalsoallowsDefencetoprovidetheAustralianGovernmentwithanadditionallevelofassuranceoverourinventorymanagementpractices,proceduresandsystems.
Nowinitsthirdyear,theNAISwasfirstconductedin2011aspartoftheDefenceInventoryAssuranceStrategytoaddressthequalificationofDefencefinancialaccountsbytheAustralianNationalAuditOffice(ANAO).In2011,theANAOcontinuedtoconductauditsamplesathighmaterialitysites.TheyalsoobservedtheexecutionoftheNAISandcomparedtheresultswiththeirownauditsamples.TheoutcomewasthattheANAOweresatisfiedthattheNAISprovidedDefencewithasound,statisticallydeterminedmeasureofthepotentialerroradjustmentforDefencefinancialstatements.In2011,Defencemadeanetreductionof$36.5mtotheMILISmanageditemsbalancesintheDefenceFY2010-11financialstatementsonthebasisoftheNAISresults.
nAtionAl ASSet AND INVENTORY SAMPLEDavid Clarke SO Logistics Performance Analysis Logistics Assurance Branch Joint Logistics Command
Asadirectresultofthesuccessfulconductofthe2011NAISbyDefence,thefollowingyeartheANAOelectednottoconducttheirownindependentauditsofMILISmanageditems.ThiswasaconsiderableachievementforDefence.ItsignificantlyreducedtheauditandassuranceburdenplacedonDefenceunitsandDefencecontractorstomeettheassuranceandauditrequirementsofbothDefenceandtheANAO.
TheANAOremainedcloselyinvolvedinthedevelopmentandapprovalofthe2012NAISmethodology,andobservedtheexecutionoftheNAIScountsatamajorityofthehighmaterialitysites.TheANAOalsoconductedanauditofallthefinalNAISresults,includingthedetailedevidenceandcountsheets,andconfirmedthatitwasagainverysatisfiedwiththeresults.In2012,theoverallNAISresultsresultedinanetreductionof$23.31m(or0.31%)ofMILISmanageditembalancesintheDefenceFY2011-12financialstatements.
ANAO comments on Defence Ministerial Submission on MILIS
‘the successful execution of the nAiS program continues to be essential to Defence demonstrating the accuracy and completeness of inventory and asset balances and reducing the risk of an unqualified audit opinion.’
Ms Jocelyn Ashford, Executive Director, Assurance Audit Services
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Aftertheexecutionandreviewofthe2012NAIS,LABcommencedplanningforthe2013NAIS.AmoredetailedandcomprehensiveAdministrationInstructionwasissuedforthe2013NAISthataddressedanumberofissuesidentifiedinthe2012NAISpost-activityassessmentsandtheANAO2011-12FinancialStatementsAuditClosingReport.AlthoughANAOstaffwillobserveNAIScountsat12locations(covering37Defenceunitsandcontractors),theANAOwillnotbeconductinganyindependentauditcountsin2013andwillagainrelyontheNAISforitsassessmentofDefenceinventoryandfinancialstatements.
METHODOLOGYEachyear,DefenceisrequiredtoprovideassuranceoverthevalueofMILISmanageditemsreportedintheDefencefinancialstatements.TheaimofthestatisticalsamplingmethodologyusedbytheNAISistoprovideareliableestimateofthedollaradjustmentrequiredtotheMILISmanageditemsbalance.ThesizeofthatadjustmenttoDefence’sfinancialstatementsismadebyusingstatisticalextrapolationofquantityerrorsdiscoveredduringtheconductoftheNAISacrossthewholeofthevalueandmixofMILISmanageditems.
TheNAISmethodologywasdevelopedbyoneofAustralia’sleadingstrategicinformationandstatisticalconsultants,DataAnalysisAustralia(DAA).TheNAISassurancesamplingissplitbetweenRegister-to-Floor(R2F)samplesandBin-to-Register(B2R)samples,andcoversallMILISmanageditems(i.e.,RepairableItems(RI)andGeneralStoresInventory(GSI)).ThetwotypesofsamplingprovideDefencewithevidenceovertheaccuracyofMILISrecords(R2F)andthecompletenessofMILISrecords(B2R).
register to floor (r2f). TheR2Fsamplingmethodologyusesamixtureofstratifiedandclustersampling.MILISholdingsarestratifiedbetweenWarehousesandSupplyCustomerAccounts(SCA),betweenRIandGSIandbetweenhigh,mediumandlowvaluelocations.SCAsarealsofurtherstratifiedbetweenDefenceSCAsandthoseheldbythird-partycontractors.Theclustersamplingisatwostageprocess,wherearandomselectionofWarehousesandSCAlocationsareidentifiedandarandomselectionofstockcodesarethenidentifiedwithinthoselocations.The2013NAISwillsample18WarehousesforRIholdings,29WarehousesforGSIholdingsand54SCAholdings.
Bin-to-register (B2r).TheB2Rsamplingmethodologywasfirstutilisedinthe2012NAIStoaddressthelong-heldconcernsoftheANAOoverthecompletenessofDefenceinventoryrecords.ThepurposeoftheB2RsampleistodetecterrorsthattheR2FsamplecannotbyidentifyinganyinventoryitemsthatdonotappearonMILIS.AB2RsampleallowsverificationofthecontentsofaWarehousebinlocationtodetectanystockcodesthatshouldnotbepresentinthebin.The2013NAISwillsample1,087Binsacross39Warehouses.
exclusions.TheNAISsampleexcludesMILISholdingsinoverseasestablishments,onoperationaldeploymentandallHMAShips.
GSI RI SCA
Total Value $2,438,377,193 $2,569,525,220 $2,705,294,878
No.ofSites 632 467 8,253
No.ofStocklines 927,036 81,05 104,316
No.ofUniqueStockcodes
390,168 42,694 22,849
TotalStock-On-Hand(SOH)
111,069,429 722,928 525,323
AverageUOIPrice $22 $3,554 $5,150
Summary of MiliS Managed Defence inventory holdings
* (MILIS data as at November 2012)
AustrAliAn Defence logistics MAgAzine 15
EXECUTIONOncetheWarehousesandSCAstobesampledhavebeenrandomlyselected,LAB,inconsultationwithGroupsandServices,developsandpromulgatestheNAISscheduleofthestartdatesofthecountsatthenominatedsites.Oneworkingdaybeforeascheduledcount,LABstaffbuildthestocktakeprogramsinMILIS,allowingtheselectedunitstoprintthecountsheetsonthedayofthesamplecount.Thesampledunitshave20daystocompletethecount,resolveanydiscrepanciesandacquitthestocktakeinMILIS.AllrelevantdocumentationiscollatedintoNAISevidencepacksandforwardedtoLABviatheparentGroupandServicelogisticsgovernancesectionforreviewandaqualityassessment.Subsequently,theANAOconductsanauditofallevidencepacksforfurtherassessment,andthecumulativeresultsofthecountarethenforwardedtoDataAnalysisAustralia(DAA).
AttheconclusionoftheNAIScounts,DAA,theANAOandDefenceresolveanyoutstandingdiscrepanciesandstatisticaloutliersinthesampleandproduceafinalreportthatmakesarecommendationforthedollaradjustmentofMILISmanageditemsbalancefortheDefencefinancialstatements.
2013 NAISThe2013NAISisunderwayandsamplecountswillbeconductedfromFebruarythroughtoJune2013.Amajorchallengefortheconductofthe2013NAISiscoordinatingthecountswiththeDefenceIntegratedDistributionSystem(DIDS)contracttransitionactivities.ToensurethatallNAIScountshavetheminimumimpactonDIDSmanagedsites,allcountsatDefenceNationalStorageandDistributionCentre(DNSDC)andJointLogisticsUnit(JLU)locationswillbeconductedinMay-June2013.ThefinalNAIScountswillcommenceon24June2013attheDNSDCwarehouseatRAAFBaseWilliamtownandJLU(North)inDarwin.
CONCLUSIONTheresultsoftheNAISreflectthecontinuingeffortsofallusersacrosstheADOtocomplywithMILISprocessesandprocedures.TheimprovingcompliancepicturesupportsDefence’sdirectiontostreamlineauditandassuranceacrossDefenceassetandinventoryholdingsandreducetheburdenonindividualunits.TheNAISresultsprovidetheCommanderJointLogistics(CJLOG)withvaluableperformanceinformationthatfeedsdirectlyintocriticalinvestmentdecisionsforfuturestaffing,technologyandsystems.
‘the nAiS has become a key assurance line of operation for Defence and the AnAo.it has played a critical role in ensuring Defence’s financial statements have not been qualified, and would not have been possible without the cooperation of all involved. the continued support of the logistics community in the execution of the nAiS is greatly appreciated.’
RADM C.W Thomas, AM, CSC, RAN Commander Joint Logistics
SGT Elvin Prasad (Air Force) and Ms Lorena Skipper (ANAO) conducting a NAIS Count at RAAF Base Amberley
Paradoxically,whileinventorydisposalsare
oneofthemostimportantactivitiesrelating
toLogisticReformandTransformation,they
havespentthelast20years,ifnotmore,being
largelyoverlooked.Despitetheoftenconfusing
andconvolutedprocessthatis“Disposals”,it
masksanimportantideology-wedon’twant
thesoldiers,sailorsandairmendependingon
ustobesentitemsthatshouldhavehitthe
scrapheapyearsago.Nolongercanweafford
fordisposalstobethe“forgottenlink”inthe
logisticschain.
Thereisnogreaterevidenceofthisthanthe
currentsituationenvelopingtheDefence
NationalStorageandDistributionCentre
(DNSDC).Atotalof39Defencewarehouses
fullofstocknowneedtobecondenseddown
intojustone.Inlinewiththis,animmense
disposalactivityhasalreadycommended.
BeginningalmostfiveyearsagoinApril2008,
theAcceleratedDisposalProjectbeganby
disposingof40,000linesofinventoryover
asixmonthperiod.Thiswasthenextended
to100,000lineswithinjustover12months.
Followingthisinitialspark,amyriadofdisposal
projectshaveflowedthroughDNSDC.These
includedtheDefenceAcceleratedDisposals
Program,MarineSupportDivisionDisposal
Project,disposaloftheB707aircraftplatform,
andmorerecentlytheF1-11,SeaKingand
Caribouplatformdisposalstonameafew.
Alongwiththisrationalisationcomesthe
changingnatureofDNSDC.Onceuponatime
thenationaldumpinggroundforDefence
inventory,thetransformationofDNSDCtoJoint
LogisticsUnitEast(JLU(E))isastarkreminder
thatdisposalsneedstobeaneverydaypriority,
andis,infact,anintegralpartofinventory
management.ThenewfacilitiesatWest
Wattlegrove,NSW,willnothavethecapacityto
functioninthesamemannerthatDNSDCdoes
now.Wewill,therefore,needtoworksmarter
inourapproachtomanagingourinventoryand
the FoRGotten linkSara Vila Disposal Clerk Defence National and Distribution Centre Joint Logistics Command
hencemanagingourdisposals.Bymaintainingandstocktakingonlywhatweneed,workinghand-in-handwithpurchasingareasasrequired,willnotonlyreducethecostoverheadforDefence,butsignificantlyreducetheriskofourpeoplereceivingandusingitemsthatarenotfitforpurposeandarepotentiallydangerous.
Atestamenttotheageofitems“firstfound”attheDNSDCaretheitemsfondlyreferredtoas“Collectables”.Suchitemshaveincludedbrasstelescopesdatingbacktothe1940s,sextantsdatingbackto1881,straightlinecompassesdatingbackto1910andleatherandsheep’swoolflyerscapsusedinWWII.TheAustralianWarMemorial,AustralianNationalMaritimeMuseum,SpectacleIslandandothermuseumshaveandwillcontinuetobenefitfromthesefinds.Surplusitemsarethenofferedforsaleinspecialisedcollectableauctions.Thispresentsaunique(andpotentiallyonceinalifetime)opportunityfortheAustralianpublictopurchasemilitarymemorabilia.
Inpartnershipwithournewandexistingcontractors,theexplorationofnewavenues(newtoDefence)fordisposals,suchasbroaderaudienceinternetauctions,specificitemtypeauctions(e.g.marineorplantequipment),shreddingweaponsratherthanthecostlysmeltingprocessorturninguniformsintopunchingbagstuffing,hasallowedforgreatervalueformoneytobeachieved.Insomecases,wehaveeventurnedthedisposalofitemsthatwouldhavebeenacosttoDefence,intorevenue.
AsDNSDCfacesthechallengesofthisnewageinstrategiclogistics,weareremindedthatdisposalsarenotamatterfortheback-burnerorthe“toohardbasket”.Theprocessisanintegralpartofwhatwedoandwhoweare,andthebenefitsgoingforwardaremoreefficientlogisticssystem,betterinventoryholdingsandimprovedsafetyforthoseveryimportantpeopleinthefieldthatitisourdutytosupport.
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AustrAliAn Defence logistics MAgAzine 17
‘if the individual’s wants are to be urgent they must be original with himself. they cannot be urgent if they must be contrived for him. And above all, they must not be contrived by the process of production by which they are satisfied. ... one cannot defend production as satisfying wants if that production creates the wants’ 1
John Galbraith, The Affluent Society
AN ESSAY ONteChniCAl ReFReShMent AnD eVolUtionARY ACQUiSition oF lAnD MAteRielltCol B and ltCol C Special Operations Command
IntroductionPopularlyregardedasattackingproductiongearedtowardsconspicuousconsumption,criticsofcapitalistconsumer-basedsocietieshaveoversimplifiedGalbraith’shypothesis.Galbraith’sargumentwasmoresubtleandcanbemadeagainsttheneedtoconducttechnicalrefreshment(TR)andevolutionaryacquisition(EA)ofMateriel.ThecurrentausterebudgetaryenvironmentreinforcesGalbraith’sargument,especiallywhenitisperceivedproductionofasuperioritemgeneratesaneed.ThosewithadolescentchildrenpossessingasoontobesupersedediPhonewillbealltoofamiliarwiththisconcept.
AimThisarticleseekstodefinefeasiblepathwaysthroughwhichArmycanimplementanddeliveracoherentprogramtosustainmaterielbysupplementingtraditionalacquisitionandsustainmentmethodologieswithplannedTRandEA.
Definitionstechnical refresh (tr).TRcanbedefinedastheperiodicinsertionoftechnologyorthereplacementofcommercialofftheshelf(COTS)andmilitaryofftheshelf(MOTS)componentsassociatedwithlargerADFsustainment dominated systems 2toassurecontinuedsupportabilityofthatsystemtoLifeofType(LOT)orinordertoextendthatsystem’sLOT.
evolutionary Acquisition (eA).EAcanbedefinedasthesustainmentofcapabilitythroughthereplacementoftechnicalorrapidlydevelopedcapabilitiesat,orinside,theirtechnicallife.EAischaracterisedbytheregularprocurementofsmallquantitiesofequipment,withlittleornorepairandattritionstockholdings.Forexample,acapabilitywithatechnicallifeof36monthsmightholdnilrepairandattritionstock,choosinginsteadarepairbyreplacementandpurchase20percentofthefleeteachyear.EAisbestsuitedtoCommercialoftheShelf(COTS)/MilitaryoftheShelf(MOTS)ormodifiedCOTS/MOTSmateriel.EAallowsCapabilityManagement(CM)stafftoprogramtechnologyrefreshesintheannualbudgetcycle,addingincreasedpredictabilitytosustainmentbudgets.AmatureEAstrategycouldhandoffsupersededtechnologytolowerpriorityformations,unitsorsub-unitswhenrefreshedwithinhigherreadinesselementsoftheforce.
1 Galbraith, J.K., The Affluent Society, pp 124
2 Systems whose long-term sustainment (lifecycle) costs exceed the original procurement costs for the system.
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OpportunityTRandEAenablestheCMandtheDefenceMaterialOrganisation(DMO)torespondquicklytochangesinoperationalneedsandprioritiesby:
• acknowledgingtherapidadoptionofcurrenttechnologysignificantlyreducestheresearchanddevelopmenttimelinesassociatedwithtraditionalblockreplacement;
• reducingintroductionintoservice(IIS)costsbecausethetechnicaldocumentationrequiredtoachievedesignacceptancecanbealignedtothatprovidedwithcommercialormilitaryequipment3;andbecauserepairbyreplacementmethodologyisoftenmorecosteffective,attritionstockandsparepartsholdingsarereducedsignificantly–furtherreducingwarehousingneed,associatedcostsandcorporategovernanceoverheads4;
• deliveringcurrenttechnology(orstate-of-the-art)equipmentsoonafteritbecomesavailable;and
• reducingprojectscheduleandcostrisksasonlyapercentageofthefleetisreplacedatanypointintime.
TR and EA driversAcoherentstrategyonTRandEArequiresanunderstandingoftheforcesthatnecessitatetechnologicalchange.Theseare:
• improved technical benefits/capability increase. Industryimprovementstoanexistingproductoftenyieldimprovementsineffectiveness,includinghigheroperationalavailability,lighterweight,improvedreliabilityandloweroperatingcostsagainstanexistinguserrequirement.
• obsolescence.Amanufacturermayceaseproductionofanitemorcomponent,renderingasystemineffectiveagainsttheuserrequirement.ThiscanbeovercomeatadisproportionallyhighcostorbyconductingTRviaanEAstrategy.
• evolving user requirement.Externalinfluences,includinglegislativechanges,evolvingthreatand/orfriendlyforceTactics,TechniquesandProcedures(TTP)orcapabilities,areknowndriversofrevisedornewrequirements.
ReturningbrieflytoJohnGalbraith’sobservationsregardinganurgentneedbeingcontrivedbytheprocessofproduction,CMstaffmight,asonemeasureofmitigation,considerarequirementtobesubjecttooneormoreoftheabovedriversbeforeapprovingTR/EAofaspecificcapability.
Case studiesobsolescence.Inextantfleets,obsolescenceisaprincipledriverofajustifiableneedtoengageinaprogramofTR,andArmyusesobsolescencetoengageinTR.Newmodelcommercialvehiclesarerefreshedasolderonesarenolongermanufactured.Forexample,anewermodel2012HoldenCommodorestaffcarreplaces2010FordFalconstaffcar.
Manyproductlinesarenotastechnicalasamotorvehicleandhaveaproductlifecycleofapproximatelythreetofiveyears,particularlyitemswithahighlevelofcommercialelectronicscontent.Paradoxically,thecombinationoftheCMandDMOdecisionandprocurementcyclesresultsinleadtimesinexcessof12monthsfromidentificationofarequirementthroughtoitseventualdelivery.Whereaproductlineisonewithahighrateoftechnicalrefresh,itislikelytobecomeobsoleteasitisdelivered.Anysubsequentprocurementislikelytoincuradditionalcoststore-manufacturethisobsoleteitem.
ItisreasonabletoconcludethatCOTS/MOTSitemswithashortproductlifecycleshouldbeapriorityareafortheCMtoapplyaTR/EAmethodology.Examplefleetsincludeinformationandcommunicationstechnology,sightingsystemsandweaponaccessories,all-terrainvehiclesandnightfightingequipment.Theseitemscanbe:
• readilyintegratedandhaveshortproductlifecycles,andthereforeshouldnotincurthecostoffulldesignacceptanceorintroductionintoservice;and/or
• procuredthrougharangeofsuppliersusingsimpleprocurementmethodologies.
3 Full IIS for repair by replacement items would not be required. Items would rarely if ever be required to undergo full Design Acceptance as detailed in the TRAMM-L, instead only undergoing Provisional Design Acceptance and being recorded within CES, ILSI and MILIS under generic nomenclatures and NSN.
4 The Defence Logistic Transformation Program (DLTP) will result in a rationalisation of warehousing space across the National Support Base. A reduction in Repair Pool and Attrition Stock holdings of suitable COTS/MOTS items that are better supported through a repair by replacement approach will support implementation of DLTP outcomes.
AustrAliAn Defence logistics MAgAzine 19
AguidingprincipalmaybethatTR/EAactivitydrivenbyobsolescenceshouldnotrequireredesignofahigher-levelassembly(thinkweaponsaccessoriesnotrequiringredesignofthesupportedweaponsystem)andthesubsequentre-certificationofthatsupportedhigher-levelassembly.Similarly,theCMcouldconsiderTR/EAwhereaProgramOfficeisrequiredtoengageaproductmanufacturertore-openproductionofanitem,oftenatsignificantadditionalcostoveranewer,betterproduct.
Perceived improved technical benefit. AsGalbraithsuggests,anewerversionofanexistingproductlineofferingalevelofimprovedeffectivenessisnot,onitsown,alwaysajustifiablebasisforperformingaTR/EAactivity.However,combinedwithasignificantdemonstratedcost-benefitimprovement,thisshouldbeadriverfortheconductofTR/EA.Forexample,SpecialOperationsCommand(SOCOMD)hasrecentlyidentifiedaCOTSretractablepistollanyardsignificantlycheaperthanthein-service“telephonecord”lanyard,anditmitigatesarecognisedsnagrisk.ThisitemisanidealcandidateforTR/EA.
Insomeinstances,thisformofTR/EAdrivermayrequiresomeformoflimitedredesignofthesupportedhigherassembly.Forexample,updatingtheinserviceMercury25HPOutBoardMotorwithaMulti-FuelEnginetosupporttheSOCOMDF470fleet.
A change in user requirement (ur).Staffinguserrequirementsisalengthyandinvolvedprocess.CMstaffshouldconsiderthelevelofdetailrequiredtofacilitatetheacquisitionandIISofnon-complexCOTS/MOTSitemthatmeetstheuserneeds.AnabbreviatedURmaybemoreappropriateandgosomewaytoaddressingobsolescenceasadriverofTR/EAinitsownright.A‘tickandflick’webformmaybeamoreappropriateavenuetostreamlinethisprocess,enablingCMandDMOstafftoeasilyreviewandproceedwithTRopportunities.
WhenaCOTS/MOTSitemissuperseded,anewURshouldnotberequired.Rathertwothingsshouldoccur:
• DMOproactivelyreviewthenewitemagainsttheexistingUR;includingthelevelofconformance,whetheritexceeds,meets,orfailstosatisfytherequirement.TheresultsofthisreviewarethencommunicatedtotheCM.
• CMstaffsubsequentlycommunicatestotheDMOagreementtoproceedwithTR/EAand/ortheacceptanceofidentifiedrisks.
A model for TR using EAAsalreadyhighlighted,manyCOTS/MOTSitemshaveathree-fiveyeartechnicalrefreshcycle.ItmaybefortuitousthatArmyhasdevelopeda36-monthForceGeneration(FORGEN)Cycle,enablingbroadalignmentofaTR/EAstrategyandFORGEN.AbasicTR/EAstrategycouldseesmalltranchesofthelatestgenerationofCOTS/MOTSitemsprocuredeachyeartosupportSOCOMD,theReadyBrigade5anditsassignedenablersinasimilarmannerasLand125iscurrentlysoldiercombatensemble.The“firstgeneration”itemis“sustained”6foracompletecyclebeforebeingupdatedwithlatergenerationequipmentmeetingtheendorsedUR.Firstgenerationitemsdeclaredobsoleteattheconclusionofthecycleeithercouldbewithdrawnfordisposalorre-issuedtolowerreadinesselementsintheenablingforce.TheSOCOMDCapabilityImprovementProgram(SCIP)demonstratesthatthismethodologycanbesuccessfulwithinSOCOMD.
TheopportunityexistsforArmytoinstituteaprogramofcontrolledhandbackofcapabilitiesintroducedbySOCOMDtoArmyinlinewiththeFORGENcycle.Figure1isastrawmanforhowthismaybeachieved.
5 Equipment subject to TR using an EA strategy would enter the FORGEN cycle at the Readying Brigade as it prepares for certification and ultimately designation as the ‘Ready Brigade’.
6 In the context of TR, selected items where TR is driven by ‘obsolescence’ and does not require higher assembly redesign, the item would be subjected to Provisional Design Acceptance (PDA) only on the basis it is a repair by replacement item with no endorsed repair strategy. They would be considered ‘in-use’ and not be subject to full introduction into service.
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Figure 1: Technical Refresh using Evolutionary Acquisition and its relationship to the FORGEN cycle
TheSCIPutilisesanEAapproachtoexploit,withinreason,industrydrivenTRtomaintainSpecialOperationscapabilityedge,enablingregularevaluationofsmallaffordablequantitiesofequipmentintrainingandonthebattlefield.TheopportunityexistsforArmytodevelopaprogramofcontrolledtransferofselectedSOCOMDcapabilitiestoFORCOMD.Exemplarcapabilitiesmayincludeaccessoriesforsmallarmsandheavyweapons.
Managing TR/EA through sustainmentTheCMarticulatesitsguidancetosupportingtheDMOthroughtheMaterielSustainmentAgreement(MSA)andamendsguidancethroughtheMSAChangeProposal(MSACP).TheMSAremainsthemostappropriatemeanstocommunicateTR/EArequirementsidentifiedthroughproductschedule(PdS)reviews,changesinrequirementsorduringnormalfleetmanagementactivities.SpecificTR/EAguidancecouldtakeanumberofforms:
• Annual ‘rolling replacement’ of a percentage of a product line.Balancedagainstobsolescenceandimprovedtechnicalbenefits,aprogramofannualrollingreplacementwouldworkbestinPdSwithalimitednumberofproductlineswheresupportedhigherassembliescanbesustainedandrefreshedbycontinuousreplacementofnon-technicalCOTSitemsthataredesignatedas‘repairbyreplacement’.
• targeted refresh.ManagedbetweentheCManditssubordinatestakeholders,targetedrefreshmightyielditsgreatestbenefitinresponsetoTR/EAdrivenbyaperceivedimprovedtechnicalbenefitand/orachangeinuserrequirement.TheapplicationofMulti-FuelEngineTechnology,developedbytheUnitedStatesSpecialOperationsCommandandEvinrude,totheADFF470ZodiacSmallCraftfleetisanactivitywhichcouldbeconductedasatargetedTR/EAactivityinresponsetoaperceivedtechnicalbenefit(newtechnologyusedtoremediateacapabilityshortcoming:Un-leadedPetrolprohibitiononRANvessels).
RefinementofMSAsandPdSdocumentationtoincorporateandresourceTRandEAguidancecouldbethesubjectofadiscussionpaperinitsownrightorongoingimprovementtotheArmysustainmentprogram.
ConclusionAperceptionexiststhatthesystemistooslowtorespondtourgentneeds.TR/EAmethodologycanmakeapositivecontributiontothetimelyrefreshofmateriel.IfCMstaffaretoensurevitalresourcesarenotwastedoncontrivedneeds,itiscriticaltounderstandtherolesofobsolescence,technologyevolutionanduserneedasdriversofTR/EA.Thisiscriticaltodeterminingtheproductlinesthismethodologycouldsupport.TheopportunitiestoreducecostsandshortenprocurementtimelinesassociatedwitharigorousandmatureTR/EAprogrammakethecaseforchangecompelling.EvenMrGalbraithmightagree.
AustrAliAn Defence logistics MAgAzine 21
BibliographyDepartment of Finance and Deregulation (Financial Management Group),1 July 2012, Commonwealth Procurement Rules – Achieving Value for Money, Commonwealth of Australia
Galbraith, John Kenneth, 1958, The Affluent Society, Mariner Books New York
Haines, Linda, 2001, Technology Refreshment within DoD, Defence Resources Management Institute, viewed 10 October 2012,
http://www.dau.mil/pubscats/PubsCats/PM/articles01/haim-a.pdf
Stavash, Jeffrey; Sharma, Shanti and Konicki, Thad, 2004, Technology Refresh: A System Level Approach to Managing Obsolescence, Lockheed Martin Advanced Technology Laboratories, New Jersey, viewed 10 October 2012,
http://www.atl.lmco.com/papers/1236.pdf
Wood, Greg, 2004, Technology Refresh Planning Aids in Sustainment of Military Systems, American Competitiveness Institute, November 2004, Philadelphia, viewed 10 October 2012,
http://www.empf.org/html/emphasis/nov04.pdf
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Australian GovernmentDepartment of Defence