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DSCC: Today & Tomorrow. Welcome. THE. DEFENSE . SUPPLY CENTER, COLUMBUS. Mr. James McClaugherty, Deputy Commander, DSCC. DSCC. “DSCC Today & Tommorow” Agenda. DSCC Today Structure Of Inventory Control Point DSCC Tomorrow Improving Customer Relationships

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  1. DSCC: Today & Tomorrow Welcome

  2. THE DEFENSE .SUPPLY CENTER, COLUMBUS Mr. James McClaugherty, Deputy Commander, DSCC

  3. DSCC “DSCC Today & Tommorow”Agenda • DSCC Today • Structure Of Inventory Control Point • DSCC Tomorrow • Improving Customer Relationships • Managing Supplier Relationships • Business System Modernization • Ongoing Organizational Realignment • Summary

  4. DLA Today: Balancing Of Two Tasks • Improved Support • To The War Fighter • Implement Transformation

  5. DSCC Today Inventory Control Point (ICP) Organization

  6. DSCC LEAD CENTER: ENERGY LEAD CENTER: TROOP SUPPORT & GENERAL/INDUSTRIAL SUPPLY Lead Center Concept Defense Energy Support Center Ft Belvoir, VA Defense Supply Center Philadelphia, PA LEAD CENTER: LAND, MARITIME & MISSILES Defense Logistics Agency LEAD CENTER: AVIATION Defense Supply Center Columbus, OH Defense Supply Center Richmond, VA

  7. DSCC DLA Weapon System NSN (Spare Parts) Workload Maritime Land Aviation DSCC DSCP DSCR

  8. DSCC Business Base • 4.9 M Reqs Annually • 1.6 M NSNs • $2.3B Sales • 22,000 Customers • 4,700 Suppliers DSCC

  9. DSCC FY02 Customer Profile By Customer Orders By Sales ($) FMS (13.3%) $308.7M Marines (2.6%) $59.4M Army (49.7%) 2,431,318 Navy (34.7%) $804.6M FMS (4.3%) 210,436 Marines (3.5%) 170,877 Coast Guard (0.5%) $10.6M Coast Guard (0.6%) 27,772 Army (23.7%) $549.1M Oth DoD (0.8%) 37,442 Oth DoD (0.7%) $15.4 Air Force (16.8%) 821,688 Navy (23.5%) 1,149,303 Civ Agencies (0.8%) 41,050 Civ Agencies (0.5%) $11.4 Air Force (24.1%) $558.5 Total Dollar Value: $2.3B Total Requisitions: 4.9 M 01CustomerProfile:kdf:22Oct 01

  10. Enduring Freedom / Iraq Freedom Requisitions by Customer Priority Groups DSCC Blue = Highest Priority 1.1M Requisitions / $486.5M

  11. DSCC Organizational Commitment To Readiness

  12. Organizational Structure DSCC Operations Support Readiness & Bus. Ops Public Affairs Command Support Internal Review Commander Deputy Cmdr Office of Counsel Small Business Customer Advocacy Corporate Information Procurement Comptroller Commodities Maritime (Q) Maritime (F) Aerospace Land Chief Of Staff Emergency Services CSO- Columbus Installation Services Safety EEO

  13. DSCC Readiness & Business Operations Commodities Land Aerospace Maritime Active Devices Unit Electrical Devices Unit Passive Devices Unit Commodities Corporate Unit Ground Transport Combat Vehicles Engineering Spt Readiness Weapon Sys Support Tailored Support Unit Transports, Bombers & Helicopters Fighters & Trainers Readiness Tailored Support Unit Surface Combatant Subsurface Small Craft Readiness Tailored Support Unit

  14. Weapon System Support Doctrine / Organization DSCC • Weapon System Vice Item Focused • Five Weapon System Groups: Land, • Maritime (Q/F), Aerospace, Electronics • 14 Weapon System Support Managers (WSSMs) One Face to the Maritime, Land & Missile Customer!

  15. Commodities Group DSCC • Different Strategy • Federal Supply Class vs. Weapon System • Face To Industry vs. Face To Customer • Multifunctional Teams Managing Federal Supply Classes (e.g. Connectors)

  16. DSCC TOMMOROW DLA’s “M Sisters” Business Systems Modernization (BSM) Customer Relationship Management (CRM) Supplier Relationship Management (SRM)

  17. Customer Relationship Management

  18. DSCC Our Reason For Being Weapon Systems Support Management

  19. DSCC Weapon Systems Supported AAV HEMTT M1 TANK PLS M88A1 M9 ACE WOLVERINE HET AVENGER Total Land Weapon Systems 551

  20. DSCC LAND CUSTOMER OPERATIONS PROPOSED ORGANIZATIONAL STRUCTURE Director Customer Ops Readiness Officer Customer Support Div. Customer Facing Div. Customer Planning Div. Operational Force Cell Group – Army M9 ACE (A) SEE (A), ETC. Eng Spt Equip Call Center HMMWV (A/M) , ASV/HMT (A), STRYKER (A), FMTV (A) TAC Veh I Operational Force Cell Group – USMC TAC Veh II HET (A), PLS (A), ROWPU(A/M), HEMTT (A), LVS (M), HTV (A/M) TBD Customer Analysts Cell Industrial Cell Group – Army Grd Cbt I BFVS (A), M113 (A) M1 (A/M), M88 (A/M) Grd Cbt II Industrial Cell Group – USMC AAV (M), LAV (M), AAAV (M), ETC. Grd Cbt III Land Other Cell Field Arty M198 (A/M), M109 (A), FAASV (A), M155 (A), S. ARMS(A/M) Air Def Missile Patriot (A), TOW (A/M), ETC.

  21. DSCC MARITIME CUSTOMER OPERATIONS PROPOSED ORGANIZATIONAL STRUCTURE Director Customer Ops Customer Facing Div. Customer Planning Div. Customer Support Div. Readiness Officer Call Center Electronics IPT Maritime Sub IPT Maritime Surface IPT Shipyard Cell Carrier/Surface Cell 02N (SWS) 21N (NRP) 23N (TRID) 82N (ALRE) EXN (SSN 688) EZN (TICON) JAN (NIMITZ) JDN (ARL BRKE) JGN (SEAWLF) JUN (OSPY MHC) JXN (AVENG MHC) YJN (SSN 774) YNN (ANTI TERR / FORC PROTEC) Customer Analysts Cell Aerospace IPT C & E IPT Submarine Cell Trident Cell Army/Navy FMS Cell Other Navy Cell

  22. Multiple Levels of Customer Relationships Partnering Relationship Relationship Growth Future Personal Relationship Transactional Relationship Now New Relationship No Relationship Source: LMI Research.

  23. Supplier Relationship Management

  24. DSCC Workload Stats – FY02 • 588,421 Award Actions • 99.7% Award Actions Under $100,000 • Competitive Solicitations • 87.3% Of Dollars • 87.5% Of Actions • DLA Recognized As Top Performing Major Defense Agency For FY2002

  25. DSCC DSCC Products Procured Most Active Past 12 Months • Values, Nonpowered (FSC4820) = $108.4 Mil • Fittings & Specialties (FSC4730) = $98.8 Mil • Misc. Power Transmission Equipment (FSC3040) = $88.1 Mil • Switches = (FSC5930) $78.1 Mil • Hose & Tubing, Flexible (FSC4720) = $71.0 Mil • Vehicle Brake, Steer Axle, Wheel & Track Parts (FSC2530) = $67.7 Mil • Pipe & Tube = (FSC4710) $56.2 Mil • Values, Powered (FSC4810) = $55.1 Mil • Vehicle Furniture & Accessories (FSC2540) = $52.5 Mil Note: Some Other Very Active Product Groups = Gun Parts, Hand Pumps, Gears, Connectors, Other Electronic Components

  26. Multiple Levels of Supplier Relationships Partnering Relationship Relationship Growth Future Personal Relationship Transactional Relationship Now New Relationship No Relationship Source: LMI Research.

  27. Reliance on inventories Reliance on Industry Management of parts Management of Relationships Managing processes Integrating supply chains Business Vision — ”A Value Added Broker of Suppliers for Materials and Services” From To • Buy commercial supply chains where they exist • Build virtual chains where the pieces exist • Retool acquisitions consistent with the vendor base • Integrate organic chain when it must be used Maintain a Balance in SocioeconomicPrograms Utilize Commercial Sector Experts

  28. Targets of Opportunity Strategic Materiel Sourcing Strategic Supplier Alliance Items representing largest business drivers Vendors representing largest business base -- Demand/spend -- Readiness factors -- BSM concept demo -- Large annual sales -- Multiple customer support requirements -- Strategic partnering

  29. Strategic Materiel Sourcing DLA’s Item Grouping Tool DEMAND/SPEND 2% of items with 80% of sales 551,000 Core Items READINESS FACTORS Surge & sustainment items, Not Mission Capable drivers and Weapon System Identifier Code & critical items with high Production Lead Time 310K Core Strategic Materiel Sourcing Groups Items for Placement on Contract Standard Long Term Contracts Corporate Contract Prime Vendor Virtual Prime Vendor Strategic Supplier Alliances

  30. DSCC Automated Manual 42,489 11,680 (78%) (22%) Automated Award Actions Apr 03

  31. Business System Modernization (BSM)

  32. “BSM = Helping Us To Better Manage Our Business” SAP Manu DPACS Integrated Customer Teams Integrated Supplier Teams C U S T O M E R S S U P P L I E R S Aviation Aviation Land Land Maritime Maritime Troop/Gen Troop/Gen This Is New Stuff For Us We Know How To Buy !!

  33. DSCC DSCC Organizational Realignment

  34. DSCC Standard Organization Structure Supply Chain S U P P L I E R Customer Operations Supplier Operations C U S T O M E R Supply Support Customer Facing Readiness and ICT Support Supplier Facing Supplier Relationship Management

  35. FOC Jan 2006 Roll Out Plan Summer 2004 Phased Roll-Out 100% Systems Capability We are here Spring 2004 2003 Design , Build, Test Release 2 Implement Release 1 2002 Release 2 Planning 2002 2001-02 Release 1 Testing and Training Summer/Winter 2001 Design/Build FOC Requirements/Blueprint Spring 2001 IOC Requirements/Blueprint January 2001 SC 025 6/17/02

  36. DSCC Summary • Today: • Weapon System & Federal Supply Class Focus • Case For Change – Single Up Organizational Alignment Across Enterprise • Tomorrow: • Comprehensive Supply Chain Management • Collaborative Partnering With Key/Major Suppliers and Customers • Improved Support To War Fighter!!

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