Defense Distribution Gets Professional Revving Up

The Defense Logistics Agency tapped a program management specialist to help it streamline the military's supply distribution system during the past few years and boost efficiency.

That streamlining process involved closing redundant facilities and assuming management of all military supply depots, including those formerly owned and operated by the Air Force, Army, Navy and Marine Corps.

As a critical part of this effort, the Defense Distribution Systems Center (DDSC), an element of the Defense Logistics Agency, was called on to implement a common distribution system for all the depots known as the Defense Standards System (DSS).

The goal was to build a best-of-breed system combining elements of each existing system as well as commercial solutions, said Jim Sanchez, director of DDSC and program manager for Defense Standards System.

The DSS development group faced a number of challenges, not the least of which was getting all the military organizations to agree to the changes, said Sanchez.

For help in managing this project, DDSC turned to Robbins-Gioia Inc., Alexandria, Va., which has carved out a lucrative niche for itself providing program management services. The company earned approximately $60 million in total revenue last year, about 10 percent more than 1997, said Gene Bounds, the company's executive vice president for operations.

About 60 percent of Robbins-Gioia's business comes from government customers, he said. The company is seeing about 20 percent growth in the public sector, with most of it coming from the civilian agencies, he said.

Its government clients also include the administrative office of the U.S. Courts, Bureau of Reclamation, Justice Department, the Patent & Trademark Office and the Department of Veterans Affairs.

There is a growing recognition of the importance of program management, Bounds said.

"Program management provides us with a snapshot of what is ahead," said Sanchez. "We can anticipate and react before something is so far off track that other components of the program are affected, which is critical to staying on budget."

"We take a holistic approach to program management, and look at it as a structured business," focusing on several areas, including planning, cost analysis and change, risk, resource, quality and life-cycle management, said Barry Cologero, Robbins-Gioia executive vice president of business development and general manager.

In practice, Robbins-Gioia personnel work closely with their clients. "We are a team here," Sanchez said. "They sit in the staff meetings and take part in all the decision-making processes."

The company also brings to the project everything needed to make management decisions, said Sanchez. Using advanced management tools, such as Microsoft Project, "they give you the data to make smart decisions and to track your progress," he said.

"We worked with DLA visiting all the services to define their requirements, started putting a comprehensive plan in place across their entire enterprise, and implemented a configuration management capability to manage change," said Bounds.

Deployment of the system, which began in 1992, is concluding, with DSS now in use at all of the 23 depots worldwide, including two megacenters in Mechanicsburg, Pa., and Ogden, Utah.

The system is mainframe-based but is being moved to client-server host, said Sanchez. The rehosting project began in December 1998 and is expected conclude in the next year and a half at a cost of about $20 million, he said. The contractor responsible for that work is MATCOMM Inc., Alexandria, Va.

According to Sanchez, the current system features bar coding, radio frequency and automated manifest technology to manage stock flow. In addition, "our customers can go on the Web and link right into DSS," he said.

For example, someone aboard a ship can go online, submit a requisition and DSS will provide specific information about where the item or items are in the distribution system in a matter of seconds, Sanchez said.

The total life-cycle cost of the system has been $1.3 billion covering a 12-year period. That figure includes phasing out the existing legacy systems, DSS design and development, system maintenance and operations, mainframe processing and implementation.

Sanchez estimated the system has yielded an estimated $500 million in savings.

Robbins-Gioia did not disclose its earnings from the project. Bounds said the company's typical engagement is in the $200,000 to $250,000 range, but that number increases if it provides outsourcing services.

? Ed McKenna