Integrating the Department of Defense Supply Chain: Techincial Report

By Eric Peltz; Marc Robbins | Go to book overview

Preface

Recognizing the promise of achieving a more integrated supply chain, the Assistant Secretary of Defense for Logistics and Materiel Readiness (ASD(L&MR)) sponsored the project that led to this report. The project was intended to provide an informed perspective on how the Department of Defense (DoD) supply chain could become more integrated based upon the body of RAND Corporation research since the mid-1990s that has focused on improving DoD supply chain performance and efficiency and based upon recent and ongoing DoD supply chain management improvement initiatives. This report draws these threads together and is intended to provide a guide for the design and improvement of DoD supply chain policy, structure, and management practices. It should also be valuable for DoD supply chain personnel at all levels with respect to understanding and determining how to improve the role they play in maximizing overall supply chain cost-effectiveness.

The DoD sustainment supply chain community has increased performance and harvested significant efficiencies through process improvement activities and rationalization of common activities. However, the majority of strides have been made within functions and processes. We posit that more opportunities for improvement remain in end-to-end supply chain integration—spanning all DoD organizations and its suppliers—of processes that jointly affect total supply chain costs and performance.1 The report explains what is meant by supply chain integration, provides illustrative evidence of DoD supply chain integration shortfalls, and describes why there are shortfalls in integration. It then provides a framework for an integrated DoD supply chain, associated recommendations for DoD supply chain policy, and a framework for developing management practices that drive people to take actions that produce supply chain integration. In the course of the project, the ASD(L&MR) adopted many of the policy recommendations in the drafting of an update of DoD supply chain materiel management policy; these changes are also described in the report. The report then turns to potential opportunities to improve DoD supply chain efficiency and performance built on the earlier material. These opportunities also provide further indications of the room to improve supply chain integration. The ASD(L&MR) and other DoD supply chain organizations have begun pursuing some of these, as indicated in the report.

This research was conducted by the Forces and Resources Policy Center of the RAND National Defense Research Institute (NDRI). NDRI is a federally funded research and development center sponsored by the Office of the Secretary of Defense, the Joint Staff, the Unified

1 The scope of this report and the associated project is the DoD sustainment supply chain, with an emphasis on classes II (clothing, individual equipment, tools, and administrative supplies), IIIP (packaged petroleum, oil, and lubricants), IV (construction materiel), and IX (repair parts).

-iii-

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