Performance Based Logistics:

1
Naval Inventory Control Point
Performance Based Logistics A New Business
Paradigm
CAPT Steve Nagorzanski ILS Director, NAVICP 28
October 2002
Ready. Resourceful. Responsive!
2
Agenda

• PBL Background
• Acquisition Process
• Business Case Analysis
• Statutory Requirements
• Awarded PBLs
• PBLs on the Horizon
• Lessons Learned
• Take-Aways

3
PBL Background

• Comply with USC Title 10 CORE Statues
• Partner with Government (e.g. Depots)
• Must pass Business Case Analysis (BCA)
• Sound Business Decision
• Merits Must Stand-up to Audit
• Reduced Total Cost to the Fleet

• Concept
• Single Supplier / Integrator
• (Commercial or Organic)
• Provide Fleet Improved Weapon System Support
  Through
• Cost Reduced Total Ownership
• Obsolescence Management
• Reliability Improvement/Tech Refreshment
• Availability Improvements

4
PBL BackgroundA Necessary Transformation
A Fundamental Change in the way NAVICP provides
Weapons System Support!!!
Philosophy
Drives Perspective
ICP Role
Results

• Focus Exclusively on Supply Availability
• More Infrastructure
• Higher Total Costs
• No Incentive to Improve Reliability or Quality

Manage Supplies
Inventory Based
Lowest Price
Historically
Change Driven by Fewer Resources, Acquisition
Reform, Technology Advances

• Focus on Customer Service, Reliability and
  Readiness
• Less Infrastructure
• Lower Total Costs
• Increased Reliability
• Higher Quality

Manage Suppliers
Performance Based
Best Value
Today
The Result... High Yield Logistics
5
PBL BackgroundA Necessary Transformation
Buying Performance Not Parts
Roles
Guaranteed Warehousing Obsolescence
Availability Management Inventory Mgmt
Transportation Reliability
Improvement Engineer/Technical
Warranties Configuration Support
Control Piece Part Support
Purpose
Leverage Commercial Supply Chain Solutions
Cultivate Long Term Partnerships With Industry
Reduce Cost Lower Response Time Lighter Logistics
Tail Increase Availability