Defense Logistics Reengineering Initiatives

DEFENSE LOGISTICS: Actions Needed to Enhance Success of Reengineering Initiatives

Since the end of the Cold War, the Department of Defense has dramatically reduced its fighting forces and logistics infrastructure. The Department estimates it is spending about $59 billion a year on logistics support 1 programs to operate and sustain weapon systems, 2 but it reports that significant reductions can be achieved by adopting a variety of different logistics support practices. We reported in January 2001 that serious weaknesses persist throughout the Department's logistics activities and that it is unclear to what extent ongoing reengineering management improvement initiatives will overcome them. 3 The Department has taken a number of significant steps in recent years directed at improving its outdated and inefficient logistics processes. Specifically, the Office of the Secretary of Defense and each of the military services and appropriate Defense commands have established a number of significant logistics reengineering efforts. In addition, the Office of the Secretary of Defense developed the Fiscal Year 2000 Logistics Strategic Plan in August 1999, which outlines six overall objectives, a basic.

As part of GAO'S continuing effort to review the Department of Defense's (DOD) inventory management practices, GAO compared the Air Force's management of its $33 billion reparable parts inventory with the operations of leading-edge private sector firms to identify opportunities where costs could be reduced and service improved. The review was done at the request of the Ranking Minority Member, Subcommittee on Oversight of Government Management and the District of Columbia, Senate Committee on Governmental Affairs. This report focuses on (1) best management practices used in the commercial airline industry to streamline logistics operations and improve customer service, (2) Air Force reengineering efforts to improve the responsiveness of its logistics system and reduce costs, and (3) barriers that may stop the Air Force from achieving the full benefits of its reengineering efforts.