The document discusses the Defense Logistics Agency's logistics strategy of working with top IT strategists to deliver technology, materials, and information around the world in a timely manner. It details how DLA has modernized its contracting and procurement processes through initiatives like electronic bidding, prime vendor programs, and leveraging web and e-commerce technologies. This has streamlined operations and reduced costs while allowing DLA to more efficiently support the vast logistics needs of the military.

2. THE LOGISTICS
STRATEGY
The Defense Logistics Agency is working with the world’s top informa-
tion technology strategists in an integrated effort to deliver technology,
materials and information around the world.
BY DAWN MARIE YANKEELOV
I n the race to deliver information to
every major U.S. military operation,
the Defense Logistics Agency has turned
to some of the world’s top information
technology strategists for planning and
implementation agendas. Commercial en-
tities have been able to answer the battle
cry for delivery in better than real-time,
beginning with the obvious deployment of
web-browser technology to more complex
programming assignments.
Bidders from worldwide consult-
ing firms, such as Booz, Allen and
Hamilton offices on the East Coast, to spe-
cialists in programming at Logicon Syscon
near the capitol, have taken on the dynamic
opportunities available to revolutionize a
contract processing system that still, in
some cases, use proprietary programming
code more than 20 years old.
Coordinating documents required
for electronic Request for Proposals trans- infrastructure at DLA will continue to be a Members of the DLA Europe Contin-
actions gives some insight into the myriad daily challenge. DLA manages the com- gency Support Team at work during
of back-end revisions that have taken place plete, computerized tracking of more than exercise Bright Star ’95 in Egypt
in the ’90s. “The ancient languages held 4 million items, processing more than 30
on mainframes and specialized application million annual distribution actions and ad-
programming interface documents that of- ministering more than $900 billion of DoD
ten were incorrect from the start for old and other agency contracts.
proprietary software had to be investigated, Recent years have seen the cou-
dissected and learned. This was done be- pling of its tremendous databases, track-
fore we could even start on the develop- ing technology, military partnerships and
ment of an automated bid interface involv- electronic commerce to leash the power of
ing technical drawings. Needless to say, it the Internet. Nearly every consumable part
was a technical challenge from the word of the military from milk to medical sup-
go,” said Travis Scarborough, subject mat- plies to ammunition is managed through
ter expert at Logicon Syscon. this agency. Nowhere else in the U.S. does
The mission to develop a for- computerdriven logistics mean so much,
ward-thinking, growth-driven computer nor affect so many daily lives. 71

3. “Speed is the new virtue in industry. Reducing time-to-market
is going to be the high-priority goal for the leading manufac-
turers in the future.” Dr. Rajan Sun, University of Wisconsin
Based in Fort Belvoir, Va., more than management on the Net.“Delivery of information at The Automated
50,000 civilian and military personnel work for the desktop is critical. We are trying to leverage our Manifest System and
DLA in facilities from supply centers to in-plant existing infrastructure. We have even enlisted radio frequency
residencies with defense contractors and property Federal Express in Memphis. We are pre-positioned tagging at work in
reutilization offices. In 1997, a new military model and can request high priority when necessary,” said Taszar, Hungary.
of thinking, Concurrent Engineering (CE), was Von Bernewitz. DLA oversees nine primary
designed to cope with further future computer commodities: clothing, including uniforms, helmets
integration initiatives. The Computer-Aided and shoes; construction material, such as lumber
Acquisition and Logistics Support (now called and plumbing accessories; electronic supplies used
Continuous Acquisition and Life-Cycle support) in maintenance and repair of military equipment;
(CALS)/CE Industrial Steering Group (ISG), fuel, such as bulk petroleum; canned, frozen, and
within the National Security Industrial Association, dehydrated food; general supplies, such as machine
chartered task groups to identify issues and guides tools and wet-cell batteries; and medical supplies,
to CE in the following areas: information exchange, including prescription drugs and surgical materials.
electronic systems, mechanical systems, software For more than 50 years, DLA has been the
and reliability and maintainability. The first report, procurement agency for DoD. In the 1940s, it was
presented at the Annual Reliability and Maintain- determined that vast warehousing would be the
ability Symposium in Philadelphia in early 1997, model of choice. However, today’s mobile military
outlined a competitive strategy for electronic is focused on 24-hour response, and dealing with
system development. immediate needs with a button click of a desktop
In recent years, Web-enabled technologies computer.
have greatly influenced the overhaul of the pur-
chasing, tracking, and delivery of supplies. “Better PRIME VENDOR AND VIRTUAL PRIME
than realtime” is how the system has been de- VENDOR PROGRAMS
scribed by Carla Von Bernewitz, executive director Commercial products from household
of Material Management, Information Systems & names are now providing items previously bought
Technology in DLA. Commercialization has crept from hundreds of vendors through EDI (Electronic
into its programs, allowing for supply chain Data Interchange). With the Prime Vendor program,
73

4. reciprocal links to suppliers and military con- & Minor continues in large part to its $30 million
sumers takes place. For example, the purchase defense contracts thanks to four medical-surgical
of food has moved from buying centers to in- supply prime vendor contracts from the Defense
dividual customers. Troops now eat the same Personnel Support Center. Over the next five years,
food we find in area hotels and restaurants. the estimated total sales for the Nation’s Capital
Competitive pricing is guaranteed, and brand region alone is approximately $163 million for
names are now on all bases within 48 hours, Owens & Minor.
such as Parris Island Marine Corps Base in Online catalogs for medical supplies, food
South Carolina. and clothing allow for unique inventory control,
Medical inventory is handled in much linked to a Material Management Intranet. “In the
the same manner. DLA supplies one of the larg- past we would have contracted for 15 different
est hospital networks in the world. Mail order vendors for just two different products. This re-
pharmacies and medical air express made great quired longterm warehousing,” Von Bernewitz
strides in aiding a monolithic delivery process, said. With the recent Virtual Prime Vendor pro-
but Prime Vendor contracts went further. Cov- gram, there is no warehousing of product.
erage in the program is now global. Emergency Virtual Prime Vendor allows tailored lo-
deliveries can be made within six hours. Losses gistics support to particular military “customers”
from expirations and overstocking have been by electronically linking all consumable parts,
eliminated. whether for combat readiness, emergency pre-
McKesson Drug Company won the paredness or day-to-day operations. Agreements
first pharmaceutical contract several years ago allow the military regional purchases with an es-
for the Washington, D.C. area. Four major com- tablished delivery process - less governmentese,
petitors dominate the U.S. consolidated medi- more commercial handling. With Virtual vendors,
cal-surgical supplies market, including there are specialized contract management services
McKesson and another DLA supplier, Owens from preaward to post-award; worldwide disposal
& Minor, Inc. The general upswing for Owens services as well as information of excess mili-

5. tary property; worldwide hazardous material dis- have migrated to commercial corporations willing to
posal, and information in its management; special- handle larger orders and stockpile at their facilities
ized product testing; and access to the Federal Cata- when necessary. The savings show up not only in less
log system. warehousing requirements, but also in personnel.
In turn, companies such as Owens & Minor David Cannon, technical director for elec-
are generating dollars for other computer delivery tronic catalogs at Management Technology Advanced
systems to support their efforts. Recently the com- Systems in Fairmont, W. Va., helped to develop this
pany purchased PowerMart, a data warehouse de- effort by working with IBM Mainframe types. Can-
veloped by Informatica Corp. in Menlo Park, Calif. non makes the point that IT people do not want to
PowerMart is used by Owens to bring sales data host the new hardware. “They do not want to look at
inhouse, supporting processes for customer service the new development requirements. The IT people
and sales. Owens currently stores its data on an want to know why this can’t be
outsourced mainframe computer and pays monthly done in Cobol,” Cannon told
fees based on usage. ComputerWorld in a recent inter-
Electronic commerce has moved the agency view. He pointed out that DLA and
to a paperless society, and more progress is expected. others believe that all suppliers
The Federal Acquisition Streamlining Act have information available in a
requires the federal government to transform the ac- useful electronic format and that
quisition process to a computer-based system readily this is not necessarily the case.
accessible to government and private users, includ- Military objectives do not differ
ing small businesses. Though the act originally much from commercial issues
called for agencies to be up and running on EDI by raised at large companies, such as
1997, an extension will allow some agencies to wait US West, 3Com, and others, he
until 1999. added.
Federal agencies are posting requests for
quotes on their individual Internet home page THE NA VY PRESSES
Websites, and Electronic Data Resource Centers CONTRACT INFORMA TION
have been set up as federally-funded agencies to help TO SMALL BUSINESS
small businesses with their government transactions. The Navy has been aggressive in the last 12 A Marine recruit
scans input into a
By filling out a two-page Central Contrac- months in deploying information and communication computer using
tor Registration form by March 1998 and filing it technology to its fleets and potential contractors. electronic data
interchange
electronically, firms no longer need to register indi- Three demonstration ships in San Diego now show- technology.
vidually with every federal site with which they do case an off-the-shelf LAN with a full-motion video
business. All procurement contracts between $2,500 system, real-time video, voice, and data transmissions,
and $100,000 will be restricted to small businesses, and a UHF radio modified for realtime audio, video,
minority and women-owned firms. For example, the and data. Every U.S. Navy ship is expected to have
Iowa Procurement Outreach Center has a hand in these interactive media systems within three years.
educating firms looking to get involved in this EDI This communications structure then assists in logis-
trend. Six Iowa federal suppliers are installing and tics deployment with all armed forces.
getting training to use hardware and software now Online activity finds ways to identify tech-
available to a few manufacturers through the Busi- nology solutions. The Navy’s Fleet and Industrial
ness Network Training Program. Supply Center (FISC) plans to add more local busi-
Concurrent Technologies Corp. is one of nesses to its technological endeavors by expanding
two companies under contract with the Department contract information on the Net. The FISC Web site
of Defense’s logistics agency to run electronic com- (www.sd.fisc.navy.mil) relates to companies’ govern-
merce centers. The centers assist both government ment marketing strategies. The types of FISC con-
agencies and small companies in adapting electronic tracts include industrial supplies and repairs, indus-
commerce technologies, including EDI. trial parts, and hardware/software. FISC distributed
By 2010, all contracts will be handled in nearly $700 million worth of commercial contracts
cyberspace, without pencil touching paper. Contracts in 1996.
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6. QRM TECHNIQUES IN THE MILITARY
The Quick Response Manufacturing ap- for bids. The issue of physical possession of documen-
proach is played out with large and small vendors tation in order to provide accurate bids used to be a big
alike. “Speed is the new virtue in industry,” said one, said John Karpovich, Chief Information Officer
QRM expert Dr. Rajan Suri, director of manufac- for DLA. “We used to have to send out packages to
turing systems engineering, Center for Quick Re- potential vendors upwards to $10 or more of paper with
sponse Manufacturing at the University of Wis- maps, drawings etc. Now technical data is hotlinked to
consin. “Reducing time-to-market is going to be engineering-related materials,” he pointed out. An Au-
the high-priority goal for the leading manufactur- tomated Bid Interface was designed by Logicon in
ers in the future.” McLean, Va., for this streamlining effort.
A small female-owned business based in The original Logicon project began back in
Phoenix, Arizona, Atlas Headwear supplies Nike, 1992. “Getting DLA to define the scope of the project
Inc., one of DLA’s Quick Response vendors. At- was difficult. For starters, we were dealing with an 841-
las now can provide the military with uniform caps transaction set, and not all 841-transaction systems are
within 72 hours of receiving an order. Other manu- alike. The TISCA system, one of the procurement sys-
tems in use at DLA, which checks technical data against
“How else can we reach every potential supplier inter- the national stock number, and the Defense Procure-
nationally?... When you post a proposal on the Web, ment Activity System, a giant list of open solicitations
in the world, posed hurdles as well,” said Scarborough,
you have an instantaneous international bid room” a subject matter expert.
John Karpovich, Defense Logistics Agency He added that the biggest hurdle was
JEDMICS, developed originally for the Navy. This
technical drawing repository on optical disks was very
facturers involved in this military partnering in- difficult to back-end, he said. Nonetheless, the first pi-
clude Alabama-based American Apparel, the Na- lot was deployed in June 1995 at the Defense Supply
tional Industries for the Blind, and Terry Manu- Center in Columbus and passed all government-re-
facturing, a small minority-owned firm that has a quired testing.
shared production agreement with McDonald’s. In the last two years, the use of the World Wide
Yet another approach called Dual-Use Web heated up further at DLA, according to Karpovich.
Technology allows for shared production agree- “The maturation of the Web has fed the demand side.
ments with manufacturers and commercial clients. How else can we reach every potential supplier inter-
This ensures that when a facility’s full production nationally? This has, in turn, created a 60 percent sav-
capabilities are needed for national defense, it will ings in time. When you post a proposal on the Web,
occur in an immediate fashion. you have an instantaneous international bid room.”
Other large corporations that participate With Java applications, Microsoft and Netscape serv-
in supplying DLA through an electronic commerce ers and software, the military has spent the last 10
forum are 3M, Grimes Aerospace, Cummins En- months refining its virtual inventory control points.
gine, Allied Signal and Boeing. More than $50 million will be spent with Microsoft
and Netscape in the next five years.
CALS (COMPUTER-AIDED ACQUISI- DLA’s five inventory control points - at Fort
TION AND LOGISTICS SUPPORT) Belvoir, Va., Philadelphia, Pa., (two points), Colum-
One of the challenges in DLA is to coor- bus, Ohio, and Richmond, Va. - buy the items used in
dinate the information required on an RFP. Not all military areas. The agency supports more than 1,400
every document can be boiled down into words. weapons systems, and purchases 86 percent of the to-
Even office furniture sometimes requires exten- tal number of items used by the Defense Department.
sive technical drawings. DLA, through computer- More than 20 million requisitions a year, representing
added acquisition and logistics support (CALS), sales of more than $11 billion annually to the military
has been able to create the architecture necessary customers, work their way through DLA.
to have plug and play specifcations available online Continued on page 206
76

7. The Logistics Strategy
in The Department of Defense: 50th
Continued from page 76
Anniversary 1997 Faircount Interna-
Success stories have occurred in every facet of tional, Inc
military operation, including the Defense
Finance & Accounting Service. Karpovich said
there has been a big savings in both accuracy
and printing costs. Coding issues, such as
unmatched disbursements, have virtually
cleaned themselves up.
DLA is also working on a pro-active
approach to anticipate contingency support
problems and to improve peacetime support in a
plan dubbed the Integrated Consumable Item
Support Model.
THE AUTOMATED MANIFEST SYSTEM
AND RF TAGS
Once ordered, the tracking process of
goods and services through DLA leaves very
little guesswork. Information Spectrum, Inc. has
developed an automated manifest system for the
military that creates instant receipts and logs
necessary information about a shipment’s
contents. An optical memory or laser card in a
thin, credit-card format is used and can with-
stand harsh weather or combat. These plastic
cards required intensive training; however, a
prototype test at Ft. Polk, La., in 1994, proved
that processing receipts could be done in 66
percent less time. Personnel requirements were
cut by more than a third. AMS has since been
deployed in Somalia, Haiti, Korea, and Bosnia-
Herzegovina.
Yet another tagging approach keeps
real-time monitoring available through wireless
communication tools. RF tags are satellite-
monitored and can be read by hand-held
scanners with precision. A tracking mechanism
known as INTRANSIT, or International
Transportation Information Tracking, records
messages and positions from moving vehicles.
This monitoring allows for personnel on the
receiving end to be prepared with appropriate
equipment or staff to move the cargo to its final
destination.
DAWN MARIE YANKEELOV is a freelance
technology writer based in Louisville, Ky.
Portions of this article originally appeared 206