Optimizing Supply Chains in Military Operations

1. 6/11/2012 1 Optimizing Supply Chains in Military Operations Moshe Kress CEMA, Israel

2. 6/11/2012 2 Preliminaries Military operations are rare events; During peacetime the military consumes resources; Peacetime SC is similar to a business SC (MinCost, best business practices, efficiency); Strategic decisions regarding wartime SC are taken during peacetime (national supply levels, logistics force structure, doctrine), F(threat, national capabilities); Operational and tactical decisions are taken during wartime: F(theater, scenario).

3. 6/11/2012 3 Logistics Support Chain Planning, implementing and controlling: - Supply - Mobilization - Ordnance - Maintenance - Medical

4. 6/11/2012 4 The General Problem

5. 6/11/2012 5 Overview Characteristics of a military supply chain during an operation Comparing Mil. SC with Bus. SC Types of uncertainty in Mil. SC Descriptive model Prescriptive model

6. 6/11/2012 6 Logistics Supply Chain

7. 6/11/2012 7 Trendy Buzz-Terms and Tenets Velocity management Minimum footprint Just-in-case vs. just-in-time Trade mass for velocity The military community has recently developed a list of trendy buzzwords (and buzz phrases) �Trading Mass for Velocity� which means carry less with the forces and enhance responsiveness by reducing lead time. There are of course two general ideas behind this phrase: Economies of scale and risk pooling. But there is also a distinct operational reason � reduce the log tail and enhance the agility of combat units. The MSC paradigm is similar to the BSC paradigm (cross-docking=supply interchange point) and, as I just mentioned, principles like risk pooling and economies of scale apply. However there are some major differences. The military community has recently developed a list of trendy buzzwords (and buzz phrases) �Trading Mass for Velocity� which means carry less with the forces and enhance responsiveness by reducing lead time. There are of course two general ideas behind this phrase: Economies of scale and risk pooling. But there is also a distinct operational reason � reduce the log tail and enhance the agility of combat units. The MSC paradigm is similar to the BSC paradigm (cross-docking=supply interchange point) and, as I just mentioned, principles like risk pooling and economies of scale apply. However there are some major differences.

8. 6/11/2012 8 Retail vs. Military Supply Chains

9. 6/11/2012 9 Service Level Measures

10. 6/11/2012 10 A Simple Risk Pooling Example

11. 6/11/2012 11 Types of Uncertainty

12. 6/11/2012 12 Descriptive (Static) Approach

13. 6/11/2012 13 Descriptive (Static) Approach cont.

14. 6/11/2012 14 Descriptive (Static) Approach cont.

15. 6/11/2012 15 Prescriptive (Dynamic) Approach(Inter-Temporal Network)

16. 6/11/2012 16 Features of ITN Nodes and edges may be added and removed Slopes of diagonal edges represent lead-times Scenarios (demand vector, graph topology) are simulated Initial supply levels - F(initial demand, transportation needs, nodes/edges survivability) Specific replenishing decision rules may be explicitly represented

17. 6/11/2012 17 Example: Two Periods Two Levels

18. 6/11/2012 18

19. 6/11/2012 19 Recourse

20. 6/11/2012 20 Looking At Scenarios

21. 6/11/2012 21 The Two-Periods Problem

22. 6/11/2012 22 Summary Military supply chains are rare; Supply-related risks are very high and must be explicitly modeled; The Logistics network has a dynamic structure; Several facets of uncertainty; Descriptive and prescriptive models; Strict probabilistic criteria; Recourse modeling is important and useful (? SP).