Defense's fleet support branch pulls out of the depot business

Defense's fleet support branch pulls out of the depot business

By William Jackson

GCN Staff

The Defense Logistics Agency is streamlining the way it buys and manages the thousands of parts that keep the Defense Department's tanks, trucks and bulldozers rolling.


The Fleet Automotive Support Initiative will free DLA depots from ordering and maintaining inventories of spare parts for DOD vehicles.


Under the Fleet Automotive Support Initiative, a so-called virtual prime contractor will handle not only acquisition and delivery of parts, but also forecasting and inventory management.

DLA wants to leverage the electronic-commerce expertise of its first virtual prime contractor to reduce the inventories of spare and replacement parts now maintained by military depots.

20,000 strong

The agency has awarded contracts for its South, Southwest and Southeast regions to ProcureNet Inc. of Fairfield, N.J. The contracts are managed by the Defense Supply Center in Columbus, Ohio. The first FASI orders covering 20,000 types of parts will begin coming in over DOD's Milstrip procurement system next month.

Contracts for DLA's East and West regions were delayed because military bases in those areas have been undergoing reorganizations. Army Lt. Col. Timothy D. Dixon, chief of the Combat Vehicles and Tailored Support Unit at the Land Application Group in Columbus, said the contracts could come late this year or early next.

'This is not outsourcing,' Dixon said. 'The FASI contractor is acting as an integrator.'

ProcureNet was selected because of its expertise in online acquisition, he said. 'One of its strengths is how long it has been doing e-commerce,' Dixon said. 'DLA is also very far along the e-commerce path.'

Although ProcureNet will have access to long-term DLA contracts for some military-specific items, it will primarily use its own supply network for FASI's back end.

'About 70 percent of our transactions today are over the Web,' said Mike McGovern, ProcureNet director of new business development.

The way ProcureNet will link to individual suppliers depends on their capabilities''either the Internet or electronic data interchange or, if necessary with the smaller guys, phone and fax,' McGovern said.

ProcureNet holds a number of federal procurement contracts, including one for services similar to FASI's for overseas military installations. The company has learned from overseas work over the last two years that 'every end user's requirements are different,' McGovern said.

FASI systems support will vary from one base to another, Dixon said.

'Each of the installations has a particular skew on what it needs supported,' he said.

Initially, FASI will cover weapons systems in the automotive fleets, meaning everything from the M-3 Bradley Fighting Vehicle and the M1A2 Abrams Tank to humvees and armored earthmovers''the things with wheels and tracks,' Dixon said.

Keeping them rolling takes about 20,000 different parts, contracting officer Jann Cook said. The number will grow as other types of vehicles are added to FASI's list.

Depending on demand and availability, ProcureNet will maintain inventories of some parts in its own warehouses and distribute them. Other parts will be shipped direct from vendors to DOD users.

FASI will roll out initially in one or two bases in each region, beginning with Camp Pendleton and Fort Irwin, Calif., in the Southwest region; and Camp Lejeune, N.C., and Fort Stewart, Ga., in the Southeast region.

The phased rollout 'will let us gain credibility with the user and gain experience,' McGovern said.

Westward, ho

Although the contract for the South region has been awarded, implementation at Fort Hood, Texas, is on hold.

'They are getting hit with a lot of new projects, so they asked that we put them down a little on the list,' Dixon said.

As part of FASI, ProcureNet is building an online catalog site from which DOD users already can buy about 500 parts. The company's goal is to put the entire program online.

'All users need is a browser, and they will be able to order over the Web,' McGovern said.

Dixon agreed on the eventual end-game plan. 'We want to keep it moving in that direction,' he said, while maintaining connectivity with older communications systems.'For the time being, 'there will be no changes in the way the customer orders,' Dixon said. 'It will be standard Milstrip requisitioning.'

Milstrip, DOD's proprietary logistics transaction system, will connect to FASI at the Columbus Defense Supply Center through an electronic paperless procurement interface, said Mark A. Stanley, chief of the center's Tailored Support Group. As Milstrip orders come in, a filter will divert the FASI portion to the interface, which will issue electronic orders to ProcureNet.

Milstrip's continued use will let DLA capture information about demand for parts and minimize the change for users.

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