Summary
Military operations in Iraq and Afghanistan have focused attention on the performance of the Department of Defense's (DOD) supply chain management. According to DOD, it spent approximately $178 billion on its supply chain in fiscal year 2007. As a result of weaknesses in DOD's management of its supply chain, this area has been on GAO's list of high-risk federal government programs since 1990. DOD released its Logistics Roadmap in July 2008 to guide, measure, and track logistics improvements. DOD has identified two technologies included in this roadmap, item unique identification (IUID) and passive radio frequency identification (RFID), as having promise to address weaknesses in asset visibility. GAO reviewed (1) the extent to which the roadmap serves as a comprehensive, integrated strategy to improve logistics; and (2) the progress DOD has made implementing IUID and passive RFID. GAO reviewed the roadmap based on DOD statements about its intended purposes and visited sites where IUID and passive RFID were implemented.
The Logistics Roadmap falls short of meeting DOD's goal to provide a comprehensive and integrated strategy to address logistics problems department-wide. The roadmap documents numerous initiatives and programs that are under way and aligns these with goals and objectives. However, the roadmap lacks key information in three areas necessary for it to be a more useful tool that DOD's senior leaders can use to guide and track logistics improvement efforts toward achieving stated goals and objectives. First, the roadmap does not identify the scope of logistics problems or gaps in logistics capabilities, information that could allow the roadmap to serve as a basis for establishing priorities to improve logistics and address any gaps. Second, the roadmap lacks outcome-based performance measures that would enable DOD to assess and track progress toward meeting stated goals and objectives. Third, DOD has not clearly stated how it intends to integrate the roadmap into DOD's logistics decision-making processes or who within the department is responsible for this integration. DOD officials stated they plan to remedy some of these weaknesses in their follow-on efforts. For instance, DOD has begun to conduct gap assessments for individual objectives in the roadmap and hopes to complete these by July 2009. They stated that they recognized the need for these assessments; however, they had committed to Members of Congress to release the roadmap by the summer of 2008 and were unable to conduct the assessments prior to the release of the roadmap. A comprehensive, integrated strategy that includes these three elements is critical, in part, because of the diffuse organization of DOD logistics, which is spread across multiple DOD components with separate funding and management of logistics resources and systems. Until the roadmap provides a basis for determining priorities and identifying gaps, incorporates performance measures, and is integrated into decision-making processes, it is likely to be of limited use to senior DOD decision makers as they seek to improve supply chain management. DOD has taken initial steps to implement two technologies included in the Logistics Roadmap-IUID and passive RFID-that enable electronic identification and tracking of equipment and supplies; but has experienced difficulty fully demonstrating return on investment for these technologies to the military components that have primary responsibility for determining how and where these technologies are implemented. Although DOD has undertaken initial implementation efforts of these technologies at several locations, at present, it does not collect data on implementation costs or performance-based outcome measures that would enable the department to quantify the return on investment associated with these two technologies. Without this information, it may be difficult for DOD to gain the support needed from the military components to make significant commitments in funding and staff resources necessary to overcome challenges to widespread implementation of these technologies. As a result, full implementation of these technologies is impeded and the realization of potential benefits to asset visibility DOD expects may be delayed.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change
from "In process" to "Implemented" or "Not implemented" based on our follow up work.
Director:
Team:
Phone:
William M. Solis
Government Accountability Office: Defense Capabilities and Management
(202) 512-8365
Recommendations for Executive Action
Recommendation: To improve DOD's ability to guide logistics initiatives and programs across the department and to demonstrate the effectiveness, efficiency, and impact of its efforts to resolve supply chain management problems, and to have a comprehensive, integrated strategy for improving logistics, the Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology, and Logistics) to identify the scope of logistics problems and capability gaps to be addressed through the Logistics Roadmap and associated efforts.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve DOD's ability to guide logistics initiatives and programs across the department and to demonstrate the effectiveness, efficiency, and impact of its efforts to resolve supply chain management problems, and to have a comprehensive, integrated strategy for improving logistics, the Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology, and Logistics) to develop, implement, and monitor outcome-focused performance measures to assess progress toward achieving the roadmap's objectives and goals.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve DOD's ability to guide logistics initiatives and programs across the department and to demonstrate the effectiveness, efficiency, and impact of its efforts to resolve supply chain management problems, and to have a comprehensive, integrated strategy for improving logistics, the Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology, and Logistics) to document specifically how the roadmap will be used within the department's decision-making processes used to govern and fund logistics and who will be responsible for its implementation.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve the likelihood DOD will achieve the potential benefits it expects from the implementation of IUID and passive RFID, the Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology, and Logistics), in conjunction with the military components, to collect detailed information on the costs, including costs currently being funded from operational accounts, and performance outcomes for ongoing and future implementation of these two technologies.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve the likelihood DOD will achieve the potential benefits it expects from the implementation of IUID and passive RFID, the Secretary of Defense should direct the Under Secretary of Defense (Acquisition, Technology, and Logistics), in conjunction with the military components, on the basis of these data, to develop an analysis or analyses of the return on investment to justify expanded investment of resources in the implementation of the technologies.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: The Secretary of Defense should direct the Secretaries of the Army, the Navy, and the Air Force; the Commandant of the Marine Corps; and the Director of the Defense Logistics Agency to determine, on the basis of the aforementioned analyses, whether sufficient funding priority has been given to the integration of these technologies into their respective business processes and, if not, to take appropriate corrective action.
Agency Affected: Department of Defense
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
