Military Logistics Shapes Up

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As the need for efficiency in military operations grows, streamlining the supply chain becomes imperative.

"In our world of defense, a vast transformation is underway, in which organizations, service members, their equipment, and tactics in combat are undergoing revolutionary change—ever more sharply focused by the events of September 11," wrote Major General Kenneth L. Privratsky, former commander of the Military Traffic Management Command (MTMC), the surface transportation command of the U.S. Department of Defense (DoD), in the organization's Strategic Plan 2002.

This transformation includes a new model for military logistics, which is being reconfigured to operate in a world of asymmetric warfare, billion-dollar weaponry, and reductions in active duty personnel.

DoD logistics operations support a continuum of efforts, ranging from small-scale initiatives such as humanitarian assistance to massive combat situations halfway around the world. Recognizing that logistics is a key part of its global response capability, the Department of Defense has given a high priority to optimizing logistics operations. It has made solid progress in compressing response time, improving service, reducing investment in inventory, and transitioning to a distribution-based approach.

"The shift from supply-based to distribution-based logistics is imperative to successful military operations," says Major General Ann E. Dunwoody, the current commander of MTMC.

While much work has already been done, the transformation is far from complete. "We've been transforming for a long time, but there's not an end state—it's an evolution," says Dunwoody, who came on board as MTMC's commander last October.

MTMC is transforming from its previous role as traffic manager to serving as a surface deployment and distribution command. "This is not just a name change. It's about process changes, organizational changes, and cultural changes," Dunwoody explains. As a result, "our warfighting allies will go to one command for all surface transportation."

MTMC will provide a single face to the field for all surface distribution, handling rail, commercial trucks, and—through a partnership with the Military Sealift Command (MSC)—ocean transportation.

Unified Transportation

MTMC, MSC and the Air Mobility Command are the transportation component commands of the United States Transportation Command (USTRANSCOM). A unified command, USTRANSCOM is headed by Gen. John W. Handy, a four-star Air Force general officer. It is supported by a staff of 730 active duty and reserve members of all the armed forces, including the Army, Navy, Marine Corps, Air Force, and Coast Guard. Now, when field commanders' transportation requirements go to USTRANSCOM headquarters, where the modal decision is made, the requirement is forwarded to the appropriate transportation component, which coordinates with the Defense Logistics Agency (DLA), the supply arm of DoD logistics.

"USTRANSCOM will be designated officially as the single joint distribution process owner," Dunwoody notes. When that occurs, the coordination and relationship between DLA and the military transportation components will be even closer than they are today.

USTRANSCOM uses a blend of military and commercial transportation resources. MTMC's portfolio, for example, includes 12,000-plus containers, more than 1,350 rail and tank cars, and 142 miles of government-owned railroad track. The military transportation components work with commercial motor and rail carriers, barge companies, and ocean liner operators. These private sector transportation resources move most of DoD's freight, which includes fuel, ammunition, vehicles, repair parts, food, and other commodities.

"We rely heavily on our industry partners," Dunwoody says. "We have healthy relationships with them, and hold forums to discuss our concerns, lessons learned, and how to improve."

MTMC also serves as DoD's port manager worldwide, with responsibility for pre-deployment planning, terminal service contracting, documentation, cargo stow planning, and customs clearance.

The scale of MTMC's operations is staggering. This spring, in just 10 weeks, MTMC moved 42.2 million meals to Iraq—enough to feed the population of Chicago for one week. During that time, MTMC transported 1.5 million tons of equipment and cargo, shipping 98,890 containers—the equivalent of 30,000 747 airloads—to support U.S. operations in Iraq.

Big Difference in a Decade

The changes underway in military logistics are reflected in the differences between Operation Desert Storm and Operation Desert Shield in the early 1990s and Operation Enduring Freedom (OEF) and Operation Iraqi Freedom (OIF) today.

"Our investment in strategic sealift and airlift capacity, along with investments in our power project platforms and assured access programs, has increased our flexibility and mobility tremendously," says Dunwoody.

The methods used by MTMC have changed significantly. "With Operation Desert Storm and Desert Shield, we sacrificed unit integrity for efficiency," she says. "We loaded vessels to maximize stows, delivering equipment vs. capability."

More than 30 breakbulk vessels carried ammunition to Desert Storm. Loading each vessel piece by piece took 14 days. Unloading the vessels required a huge reception staging area and substantial labor to sort the materiel by combat unit.

To support the combatant commander and the Army's intent to deliver capability and "force packages" in Operation Iraqi Freedom, MTMC employed a different strategy. Loading vessels by task organization with unit basic loads enabled MTMC to deliver capability rather than equipment. In port, MTMC assembled force packages that contained ammunition, artillery, food, and other items into one unit.

Cargo Ready for Combat

As a result, all the materiel for a brigade combat team was loaded by force package. While it takes longer to load the vessels this way and it's slightly less efficient, Dunwoody notes, when the loads come off a ship, they're ready to go into combat, significantly reducing the time required for RSOI (Reception Staging and Onward Integration).

Another key difference between logistics operations during Desert Shield/Desert Storm and OEF/OIF is asset and in-transit visibility.

"We used to put items in containers and not know what was in them," Dunwoody recalls. "We didn't have the technology to track materiel, and didn't have business rules in place for our carriers to provide identification of container content."

This meant that, when a container arrived, field forces often didn't know what was in it until they opened it. MTMC today is moving toward total in-transit and asset visibility, thanks to the use of radio-frequency tags and business rules requiring detailed information from carriers.

The Command is integrating supply chain strategies into its operations. "The commercial industry is our benchmark," Dunwoody notes. "We try to take the best of industry practices to streamline our process." This might include using Six Sigma, balanced scorecard, or best performance practices to better manage velocity and reduce customer wait time.

In December, MTMC revamped the way the military procures domestic freight services, streamlining procedures and awarding Tailored Transportation Contracts that put a premium on responsive, time-definite, consistent levels of service. The initiative was the result of work done by an integrated process team that included military transportation, acquisition, legal, and industry representatives. MTMC's industry partners and customers played an active part in developing the performance-based work statements. DoD shippers are free to choose among the carriers operating in their region, and can access a web-based metrics system that tracks and monitors contractor performance.

This is just one example of the changes underway at MTMC. "MTMC is almost one-half the size it was in Desert Storm," says Dunwoody, with more than 200 active duty personnel compared to the more than 600 on board during Desert Storm. As a result, "we're heavily dependent on reservists, our civilian workforce, and our partners in industry," she says.

Fort-to-Port Command and Control

Dunwoody is working to realign MTMC units with modular capabilities that will allow for fort-to-port command and control, fully integrating the reserves with active duty units. This means supporting a highly adaptive and committed workforce with technology, equipment, and revamped processes, and establishing a culture dedicated to achieving MTMC's vision: to be "the warfighter's single surface deployment/distribution provider...accountable for synchronized and agile solutions...to deliver capability and sustainment on time."

Like MTMC, Air Force supply strategy and operations are undergoing a transformation. Just ask Marvin A. Arostegui, who was a U.S. Air Force supply officer for 15 years. "The career field that used to be called 'supply' doesn't exist anymore," notes Arostegui, who is now a major. "All of us who used to be supply, transportation, and logistics plans officers have all become logistics readiness officers."

The Air Force is striving to develop true logisticians who are knowledgeable in all aspects of planning and moving people and materiel for contingencies.

The transition from functional to logistics readiness officer has been in the works for several years. The first step involved combining the transportation and supply functions.

"We had done a lot of centralizing, using information systems to streamline operations, so it made sense to combine those two organizations into one and implement the concept of supply chain," Arostegui says. Logistics planning capabilities were then added, producing the broader position of logistics readiness officer.

The organization has changed to support the new concept. "At the bases, we used to have supply squadrons, transportation squadrons, and a staff function over logistics plans. All those were brought together under a single squadron, called the logistics readiness squadron," the major explains.

Arostegui was one of the first logistics readiness squadron commanders, based at Yokota Air Base in Japan. "At first, I was a supply squadron commander, then I transitioned to become the logistics squadron commander," he recalls. "I inherited the transportation and logistics planning functions, and went from having 250 personnel that did supply and fuel only, to having 530 people that did everything." The transition, which began in June 2002, was completed just 50 days later.

Some of the changes included co-locating the inbound transportation function at Yokota with the supply receiving function, and co-locating the supply reverse logistics function with outbound transportation. Results are already significant, especially in cycle-time reduction. More improvement is expected in the future, Arostegui says, especially once Air Force personnel are cross-trained.

The move to a true logistics position is just the latest in a number of changes that have taken place in the supply side of military logistics. "When I started out, we ran big warehouses where we'd keep and store everything from critical airplane parts to pens and pencils, light bulbs, and cleaning supplies," Arostegui recalls. "We'd stock maybe 70,000 different line items."

Crediting the Purchase Card

Creation of the government purchase card changed all that. Today, base personnel can purchase basic supplies using their credit card, which enables them to buy from the private sector, such as an office supply store, or directly from the General Services Administration over the Internet.

As a result, Arostegui notes, "we don't have to stock those types of products on base, so have narrowed our focus to items you can't get from the private sector, such as weapon systems support and aircraft parts." The change has made a significant difference in the way the Air Force operates.

"We used to maintain warehouses with parts such as tires and filters for vehicle repair and maintenance," Arostegui says. Now, a combination of vendor-managed inventory and use of the government purchase card enables a supply specialist who works with vehicle maintenance, for example, to keep a small amount of stock on hand without having to maintain a large inventory.

Another major change is the centralization of inventory management. "Decisions about what to stock and not to stock used to be made at the base level," Arostegui says. Then the Air Force centralized much of inventory management into four regions that have visibility of the inventory in the warehouses.

Now, "instead of hundreds of people at each base, we have a few dozen doing inventory management at the centralized regions," explains Arostegui, who has returned from his tour at Yokota to serve as assistant professor of logistics at the Air Force Institute of Technology, Wright-Patterson Air Force Base, Ohio.

A True Sea Change

Things are changing for the Marines as well. As they transition from fighting linear to multidirectional battles, the methods of supporting the Marines are also being transformed, notes Kevin R. Gue, associate professor of logistics at the Graduate School of Business and Public Policy of the Naval Postgraduate School in Monterey, Calif.

Historically, Marines have stormed a beach and pushed inland. After they took the beach and cleared out a large space for supplies, support operations would establish acres of logistics support facilities from which to run a regular distribution operation.

Supporting Marines from the beach is not practical when the United States is unable to obtain host nation support for military logistics operations, Gue says. More importantly, Marines are developing new modes of warfare that involves inserting a number of small fighting forces that attack in multiple directions.

As a result, "we can no longer support the Marines in the traditional way," notes Gue, who has researched issues involved in supporting Marines from the sea.

"The term 'sea-based logistics' and the concept of supporting Marines from the sea are not new. But the thought of doing it on a massive scale is definitely new," Gue says.

Sea-based logistics would involve having pick, pack, and delivery operations taking place on a sea base—a ship or set of ships that act as a floating warehouse or depot. This would require flying in tailored and customized loads to small units of Marines located in small places in hostile environments.

Transitioning to this new support model "will probably require entirely new classes of ships or modified versions of existing platforms," Gue notes. "Right now, we have ships with gigantic holds, into which we cram lots of materiel that is sent to the beach where it's sorted and shipped out."

Sea-based logistics will require that sorting and picking be done onboard ship. To do so, "the ship has to be transformed from a warehouse to a distribution center," he explains, "so we can pick items, assemble orders, kit, package, and ship supplies out via helicopter or tilt-rotor aircraft."

The sea-based logistics model has a number of crucial issues that need to be resolved, including:

Replenishing ships. One option is to send some ships in the sea base to a land base to be resupplied. Another option would be to use shuttle ships to replenish the sea base. "This would involve transferring goods from one ship to another on a large scale," Gue says. In addition to numerous material handling and technology questions are issues such as how to transfer standard shipping containers at sea in rough weather.

Optimizing support operations. Also being considered is how to optimally sustain a Marine force at shore. This might involve pre-kitting pallets of supplies. "Suppose there's a battalion ashore that has been in the field for a week or two. They'll run out of initial supplies, and we'll have to 'sustain' them, perhaps on a daily basis," Gue says. Anticipating demand and preconfiguring replenishment supply kits will help minimize the distribution challenge for Marines on shore.

Where breakbulk is done. "Almost everything that comes from the continental United States will be in shipping containers. "But Marines in the field don't handle containers," Gue says, "so at some point we have to break down the container into smaller units." If a sea base is replenished by shuttle ships, should the container be broken down before or after it's transferred to the sea base?

More Changes to Come

While many changes are well underway, the job of transforming military logistics is not done. "There's room for improvement in reducing cycle time," notes Stephan P. Brady, Ph.D., who is a lieutenant colonel in the Air Force. Brady is assistant professor of logistics management and deputy department head at the Air Force Institute of Technology.

Using Collaborative Planning, Forecasting and Replenishment (CPFR) and other tools will enable the Air Force to reduce order cycle time by matching production with demand. But "collaborating requires us to think differently," Brady notes. Such change can come slowly.

"We need to convince people that things will work better than they did before," he says, and will enable meeting requirements faster, more reliably, and at lower cost.

As part of his work at AFIT, Brady is looking at the lessons learned through CPFR to see how they can be applied to a military organization. He will make presentations on topics such as CPFR and change management to military and civilian management personnel at Air Force maintenance depots during two-day executive seminars on process improvement.

Whether executive education or a master's degree, The Air Force places a high premium on education and training, with much of that taking place at AFIT. "AFIT is chartered with education beyond basic training for everyone in the Air Force," explains Brady, who is a deputy department head at the institute. AFIT offers continuing education in logistics through its School of Systems and Logistics, and a core management program in logistics through its Graduate School of Engineering and Management.

"We have a pedigree that most schools would be proud to have, with a logistics management faculty from Penn State, Ohio State, Michigan, Arkansas, the University of Maryland, and Arizona State," Brady says.

Part of their task is exposing students to new toolsets and helping them develop critical thinking skills. "The goal is to help officers and enlisted troops in the field make better decisions," he explains. In military logistics, as in private industry, a key challenge is to make optimum decisions that balance requirements and resource constraints.

"There are very few differences between military and business logistics," according to Brady, who notes that many business logistics lessons originated in the military.

For example, the military supported General Patton with just-in-time logistics. "He was always one day ahead of lines of supply. He always traveled lean, and the support staff made sure he had what he needed the next day."

With new methods, strategies, and systems, military logisticians are working hard to make sure they can continue to do the same, supporting the warfighter of today—and tomorrow—on time, every time.

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