Page 1

SPECIAL REPORT

Global Defence Logistics Solutions

Global Defence Logistics Solutions The Increasing Importance of Logistics The Commercialisation of the Defence Supply Chain Ensuring SMART Defence and an Assured Supply Chain Delivering the Future

Sponsored by

Published by Global Business Media


Supply chain solutions

for defence and security

LAND

SEA

AIR

& COMMUNICATIONS

MARITIME SUPPORT

FIXED WING & ROTARY

Wincanton designs, implements and manages secure, cost effective supply chains for many of the world’s leading land, sea and air defence manufacturers. We help them operate more efficently, effectively and safely to support their customers globally

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk

Unlocking potential DF/9/1.0/0614


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

SPECIAL REPORT

Global Defence Logistics Solutions

Contents

Global Defence Logistics Solutions The Increasing Importance of Logistics The Commercialisation of the Defence Supply Chain Ensuring SMART Defence and an Assured Supply Chain

Foreword

2

Mary Dub, Editor

Delivering the Future

Global Defence Logistics Solutions

3

Wincanton Plc

Best in Class Supply Chain Solutions Working to Budgets and Timetables

Sponsored by

Synchronising the Supply Chain – the Key to Efficiency Published by Global Business Media

Published by Global Business Media

Best People Produce Best Results Wincanton’s Defence Supply Chain Solutions

Global Business Media Limited 62 The Street Ashtead Surrey KT21 1AT United Kingdom

The Increasing Importance of Logistics 6

Switchboard: +44 (0)1737 850 939 Fax: +44 (0)1737 851 952 Email: info@globalbusinessmedia.org Website: www.globalbusinessmedia.org

The Strength of TRANSCOM

Publisher Kevin Bell

The Commercialisation of the Defence Supply Chain

Business Development Director Marie-Anne Brooks Editor Mary Dub Senior Project Manager Steve Banks Advertising Executives Michael McCarthy Abigail Coombes Production Manager Paul Davies For further information visit: www.globalbusinessmedia.org The opinions and views expressed in the editorial content in this publication are those of the authors alone and do not necessarily represent the views of any organisation with which they may be associated. Material in advertisements and promotional features may be considered to represent the views of the advertisers and promoters. The views and opinions expressed in this publication do not necessarily express the views of the Publishers or the Editor. While every care has been taken in the preparation of this publication, neither the Publishers nor the Editor are responsible for such opinions and views or for any inaccuracies in the articles. © 2014. The entire contents of this publication are protected by copyright. Full details are available from the Publishers. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical photocopying, recording or otherwise, without the prior permission of the copyright owner.

Mary Dub, Editor

The Political Vulnerability of Supply Routes Reducing and Eliminating Demand for Goods, but not Fuel or Water

8

Don McBarnet, International Security Correspondent

Transformational Logistics The American Defence Logistics Agency Containerisation Networked Supply Chain

Ensuring SMART Defence and an Assured Supply Chain

10

Don McBarnet, International Security Correspondent

Software Supported Defence Supply Chains Lessons Learned from the Last 10 Years of Operations The Global Military Defence Logistics Market Projections

Delivering the Future

12

Mary Dub, Editor

The Future of UltraLog DARPA’s UltraLog Network Security Under Cyber Attack The Science of Networked Logistics

References 14

WWW.DEFENCEINDUSTRYREPORTS.COM | 1


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Foreword

“In the future, competition will be among supply chains.”

T

HIS WAS a saying by a prescient Israeli management thinker. It holds true in the 21st century with even greater rigour. This Special Report reviews the way the austerity of the last five years has been the catalyst for a stepchange in organisation and practice in the defence logistics industry.

logistics in the last five years. The specific institutional changes this has entailed are explored in the third piece. The growing use of high quality commercial support contractors for defence projects is the new trend. This increasing demand for contractor support has led to the introduction of good commercial practice, agility, resilience and operation networks to defence supply chains. Integrated contractor support to ministries of

The Report opens with an article that looks at the

defence has led to a step-change in industry; there

UK-based company, Wincanton, whose services

is now a bias towards the commercial approach.

cover the whole global supply chain and whose

However, there is a critical difference between the final

broad knowledge of the defence sector enables it to

accountability of commercial and defence logistics. On

create a host of added value benefits for many of the

operations the state is always ultimately responsible

world’s leading defence manufacturers. The article

for defence provision. This is not the case in the

examines the role played by the company in managing

commercial sphere.

the supply chains involved in the delivery of two Queen

For this writer like any other, there are always

Elizabeth (QE) Class aircraft carriers – the highest

difficulties about writing about the future of any field.

single value single build programme ever seen in the

However, a firm grounding in the strong trends of

UK defence industry. Training, safety, accuracy and

the present is not a bad starting point. Looking at

attention to detail, ensuring the best practice results

the way that DARPA has worked to achieve greater

are fundamental factors behind the delivery of the

resilience in its data driven logistics software

company’s high performing operations.

system, UltraLog, is revealing. The agility and resilience

The second article in the Report looks at the critical

of the software system it envisages is not just on

importance of logistics often learnt the hard and most

the ground, monitored by data, but is also assured

expensive way by the international coalition forces

against cyber attack.

in Iraq and Afghanistan in the last decade. The key factor that runs through the analysis is the overarching primacy of good logistics to ensure the successful continuation of the campaigns at a tolerable cost. American and British administrations have restructured their organisation and thinking about

Mary Dub Editor

Mary Dub is the editor of this Special Report. She has covered the defence field in the United States and the UK as a television broadcaster, journalist and conference manager.

2 | WWW.DEFENCEINDUSTRYREPORTS.COM


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Global Defence Logistics Solutions Wincanton Plc

W

INCANTON DESIGNS, implements and manages secure, robust and valueadded supply chains for many of the world’s leading defence manufacturers. Both deep and broad knowledge of the sector and the particular pressures it faces enable Wincanton to create value-added benefits, including efficiencies, cost-effectiveness, compliance and safety measures for its customers in this highly competitive and complex market.

The range and diversity of equipment is enormous, from basic nuts and bolts to 120 tonne Gas Turbine Assemblies or 40 tonne propeller shafts requiring special humidity controlled storage conditions.

Best in Class Supply Chain Solutions Wincanton’s services cover the whole global supply chain and, by working closely with its customers, it has a hard-earned reputation for delivering innovative solutions that continue to redefine and add value to defence logistics. When the Aircraft Carrier Alliance (ACA), a unique partnership between the UK Ministry of Defence and key prime defence contractors, was given responsibility for delivering two Queen Elizabeth (QE) Class aircraft carriers – the largest, most complex and highest value single build programme the UK defence industry has ever seen – it turned to Wincanton to manage its supply chains. Exceptional challenges require exceptional solutions, which themselves require exceptional people to deliver them. For its partnership with the ACA Wincanton devised and deployed best in class supply chain solutions that were completely new to the defence sector. The project’s scope is enormous and includes the full range of supply chain solutions, from designing bespoke packaging to collection and handling via a specifically designed central warehouse operation. With such vast scale comes complexity. Over 100 suppliers are involved in the manufacture of the QE class with over 8,500 different parts being delivered against a precise schedule to a range of different assembly yards. Never has the phrase “right product to the right place at the right time” been so important.

Bespoke defence supply chain solutions for land, sea and air

LAND WAREHOUSE MANAGEMENT

Since 2009, when the programme commenced, Wincanton, in partnership with the ACA, has: • Delivered a fit-for-purpose centralised storage and distribution facility alongside flexible and highly cost effective additional storage as and when required to meet the dynamics of the build programme • Consistently produced innovative solutions to drive down base costs • Achieved world class health and safety standards with no LTA (Lost Time Accidents) for over four years • Devised effective transport networks that both minimised the cost base and the carbon footprint with sustainability being the prime focus throughout the whole operation • Handled nearly 20 million items with a stock accuracy of 99.94%.

SEA

AIR

Working to Budgets and Timetables Any major project involving the public purse inevitably and quite rightly comes under intense scrutiny. Mindful of these politically sensitive aspects, heavy focus was placed on both budget and timetable, considerations made even more critical following the Strategic Defence Review, second only to health and safety.

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 3


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Over 100 suppliers are involved in the manufacture of the QE class with over 8,500 different parts being delivered against a precise schedule CONTAINER MANAGEMENT

to a range of different assembly yards

To allow the ACA to optimise build efficiency it was essential for the supply chain to provide exactly what was needed at exactly the right time, with the solution’s core principle being based on inventory and system accuracy ensuring the highest possible level of material visibility and availability. To meet this challenge the IS solution was carefully designed following a comprehensive analysis of the ACA business to ensure all requirements were fully identified, understood and satisfied. The system needed to interface seamlessly with a whole range of ERP systems embedded in the various build and assembly yards and the innovative use of the “Data Warehouse” ensured a single conduit for information flow to and from all sites. As with any system, processes and procedures need to be operated with a high level of compliance and this is never more important than within the defence industry. The key focus is attention to detail and on ensuring tasks are performed “right first time, every time” - Wincanton looks to pass this quality ethic throughout the supply chain. Recognising the need to provide the highest storage utilisation in order to minimise costs, Wincanton introduced a “best in class” warehouse management process and operates with a dynamic and constantly re-configured racking solution to respond to the continually changing product mix.

Synchronising the Supply Chain – the Key to Efficiency Drawing on its extensive experience and depth of expertise, Wincanton’s team knows that optimum efficiency can only be achieved by synchronisation of the whole supply chain, 4 | WWW.DEFENCEINDUSTRYREPORTS.COM

making working with the supplier base a prime objective from day 1. Ensuring all suppliers understood the need for a co-ordinated strategy and the close adherence to agreed procedures delivered a level of control and compliance that both optimised resource and produced a smooth efficient and therefore cost effective, operation. This highly controlled process not only facilitates exceptional levels of quality but also contributes hugely to a safe working environment – the number one priority for all business. Working closely with the suppliers creates benefits for all parties, with Wincanton offering a transport network that consolidates collections from a whole portfolio of different vendors all with the common goal of the same customer – the ACA. This generated a cost effective delivery solution to the vendors with savings shared and passed on to the ACA and, like any optimised transport solution, reduced miles results in a greener footprint – so a real win/win.

Best People Produce Best Results Wincanton knows that devising, implementing and operating the best supply chain solutions requires the best individuals and teams and the development of a true “people culture” – all fundamental factors behind high performing operations. Wincanton’s comprehensive range of solutions is aligned to every stage of the defence supply chain, with each service delivered by specialist teams whose attention to detail delivers best practice results. Much time is spent ensuring these teams are well trained not only in operational procedures,


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Bespoke defence supply chain solutions for land, sea and air

WINCANTON WAREHOUSE PEOPLE

but that they fully buy into the key principles of safety, accuracy and total belief in customer service. In turn, teams are rewarded for their effort and commitment and this open and honest working environment ensures the opportunity for all ideas to thrive and for people to really feel they can influence their place of work. Adding value was a key objective from day one. The Wincanton team took great pride in being able to drive out cost from the ACA’s logistics budget over the course of the programme. Reinforcing its reputation for unlocking potential in its customers’ supply chains and cementing its position as the leading logistics partner for the defence sector.

Wincanton’s Defence Supply Chain Solutions Inbound logistics Managing component in feed and kitting from vendor to production Warehousing services Scalable and flexible storage solutions to respond to exacting and changing programme demands Transport services and management 5,000 networked vehicles providing an integrated transport service from port of origin to customer Spares and reverse logistics Covering the collection, storage and distribution of serviceable and unserviceable spares Freight forwarding Integrated services to enable full visibility and traceability from point of issue to point of delivery

Tooling and maintenance parts logistics Storage, distribution and asset management of tooling, engineering and maintenance spares Post production and military packing Specialist on or off-site packing and outbound logistics to trade, military and export standards

LAND

Packaging design, manufacture and supply In-house design, production and supply of high performance packaging Records management Secure, on and off-site storage for hard copy documents and electronic media Technical services and information technology Engineering inspection, x-ray scanning, IT interfaces and solution modelling

SEA

Global support Providing value, innovation, operational excellence and sustainable high performance across all territories Compliance, SC21 and integrated management services Adherence to regulatory standards and licensing, best practice and continuous improvement

Contact Wincanton Plc. Methuen Park Wiltshire SN14 0WT United Kingdom Tel: +44 (0) 1249 710 000

AIR

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 5


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

The Increasing Importance of Logistics Mary Dub, Editor

“Bitter experience in war has taught the maxim that the art of war is the art of the logistically feasible.” Admiral Hyman Rickover, United States Navy (1900-1986)

A lack of projected surplus capacity along the Pakistani routes in conjunction with ongoing insurgent attacks, pilferage, trucking strikes, and growing fears of other scenarios, led defence planners to search for new ways to resupply their forces

B

UILDING A resilient and risk free supply chain is as critical to the achievement of a military operation as it is to a commercial venture. In the 21st century, the delivery of a product has become integral to the product itself. Indeed the competitive edge of a product in the market place is linked directly to an effective supply chain strategy. To continue the analogy, the decisive edge that a military force requires to prevail is directly linked to the resilience and robustness of its supply chain strategy.1 The recent ISAF campaign in Afghanistan, which is now being wound down, (writing in 2014) was subject to on-going pressures because of the vulnerability of lines of supply to its bases and forward operations. The CSIS (Center for Strategic and International Studies) reported in 2009 that as the Taliban insurgency in Pakistan intensified, these critical supply lines had come under increasing harassment. Baitullah Mehsud, for example, the late leader of the Tehrik-e-Taliban Pakistan, directly threatened this logistical pipeline, pledging that convoys would not be allowed to reach American and NATO units in Afghanistan. While Mehsud was unable to achieve this objective, militants forced the Pakistani government to stop Afghan-bound supply convoys seven times between September 2008 and March 2009.2

considered, and the price forced reconsideration. A lack of projected surplus capacity along the Pakistani routes in conjunction with on-going insurgent attacks, pilferage, trucking strikes, and growing fears of other scenarios, led defence planners to search for new ways to resupply their forces. One option was to increase shipments via air. According to General McNabb, “If we had to do everything by air, you would see a Berlin airlift.” This option would have been extremely expensive. Estimates by NATO placed the cost of airlifting supplies to Afghanistan at $14,000 per ton, or $7 per pound.3

The Strength of TRANSCOM

Reducing and Eliminating Demand for Goods, but not Fuel or Water

While Taliban attacks on supply convoys hampered the supply of essential goods, the lines were resilient. In March 2009, General Duncan J. McNabb, commander of the U.S. Transportation Command (TRANSCOM), stated that “about 130–140 shipments reach Afghanistan via Pakistan each day.” At the time, force levels in Afghanistan required only 78 containers per day. Thus, the attrition along the Pakistani supply line was not severe enough to hamper the overall war effort. But while the supply was resilient there was a price to be paid. To enable another approach, airlift was 6 | WWW.DEFENCEINDUSTRYREPORTS.COM

The Political Vulnerability of Supply Routes The dependence of ISAF forces on Pakistani cooperation to let supply convoys through is still an on-going pressure on TRANSCOM logisticians working in Afghanistan. The killing of 24 Pakistan soldiers in November 2012, allegedly by US forces, resulted in an escalation of demands for transit fees per truck from $250 to $5,0004. This figure was only reduced when Washington apologised for the losses suffered by the Pakistan military.5 The vulnerability and cost of the supply lines to Afghanistan led to local sourcing and a determined search to find ways to reduce the demand for materiel that had to pass through the bottlenecks.

The long logistics supply route that has to be sustained created a sense of urgency in reducing demand for imported products. The long logistics “tail” that follows troops into the war zone – moving fuel, water and supplies in and waste out – risks lives and diverts major resources from fighting. Fuel and water represented two-thirds of the tonnage in Iraq convoys – each one vulnerable to insurgents’ explosives. Armoured vehicles, helicopters and even fighter aircraft must


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Bespoke defence supply chain solutions for land, sea and air

LAND

SEA

protect each other. Afghanistan’s more remote, mountainous roads are still more challenging. Slowly seeing this reality, the military has deployed simple measures first. The Army, for example, recently spent $95 million spraying tents in Iraq with foam insulation, slashing air conditioning demands nearly in half and eliminating an estimated 12 fuel convoys a day.6 However, in 2014 the convoy trail is reversed as the last of the military equipment is being shipped out of Afghanistan and the remaining “white goods” brought in at such a price are sold

on the domestic market. On sale are a variety of previously used, commercial off-the-shelf items such as pneumatic tools, air conditioning units, office furniture, tractors, water trucks, forklifts and construction machinery.7 Many of the basic life support equipment items available, like shower and bath trailers, are no longer needed due to changing force requirements. This provides a commercial bonus for the Afghans who are able to make use of the products, and have fewer items to pack and return down a long supply route to their country of origin.

AIR

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 7


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

The Commercialisation of the Defence Supply Chain Don McBarnet, International Security Correspondent

“Leaders win through logistics. Vision, sure. Strategy, yes. But when you go to war, you need to have both toilet paper and bullets at the right place at the right time. In other words, you must win through superior logistics. Go back to the Gulf War. After that war ended, the media stories focused on the strategy that was devised by Colin Powell and executed by Norman Schwartzkopf. For my money, the guy who won the Gulf War was Gus Pagonis, the genius who managed all of the logistics. It doesn’t matter how brilliant your vision and strategy are if you can’t get the soldiers, the weapons, the vehicles, the gasoline, the chow – the boots, for God’s sake! -- to the right people, at the right place, at the right time. (Right now, Amazon. com and a hundred of its dotkin are learning – or failing to learn – the Gus Pagonis lesson.)” Tom Peters – Rule #3: Leadership Is Confusing As Hell, Fast Company, March 2001

The aim is to maximise contractor involvement, the CfC (Contracting for Capability) model, where the prime contractor provides a total support package

W

ITH THE end of operations for ISAF in Afghanistan approaching and a considered reluctance by President Obama to get involved in the conflict in Syria or Iraq, there is a trend towards financial retrenchment in the United States and Europe. This is exacerbated in the United States by Congressional requirements for cuts to defence budget and sequestration. What does this mean for the defence logisticians in the United States and Europe? In the United Kingdom the coalition government’s commitment to austerity has been the catalyst for a rethinking of the defence supply chain. The policy is called Transformational Logistics. What will this mean in practice?

the CfC idea is the Smart Acquisition approach, which encourages PTs (Project Teams) to seek increasingly innovative support solutions in order to optimise levels of service and value for money to drive down the cost of ownership. And there is more than one way of achieving this. CLS (Contractor Logistic Support) is defined as the methodology by which responsibility for provision of an agreed level of support is transferred to an industry provider. CLS can cover a wide spectrum of industry involvement ranging from minimal transferral under traditional product based support solutions to maximum transfer of responsibility to a Contractor. But the key idea behind CLS is the central importance of industry.

Transformational Logistics

The American Defence Logistics Agency

The plan from the Defence Equipment and Support Agency, part of the British Ministry of Defence, is to transform logistic support to the Front Line by delivering improved reliability and availability and continuing to maintain that level of support at reduced cost.8 Underpinning the strategy is the need for a through-life view that optimises logistic support solutions and provides opportunities and incentives for industry. The increased role for industry with a tighter budget is the message. The aim is to maximise contractor involvement, the CfC (Contracting for Capability) model, where the prime contractor provides a total support package. Aligned with

The American Defense Logistics Agency (DLA), one of several US agencies tasked with logistics, is seeing the post-overseas operational environment as quite different to when there were commitments in Iraq and Afghanistan. The management of food for the troops is a case in point. There is a shift in the way DLA and its industry partners do business. Col. Robert King, DLA Troop Support Subsistence Director, provided the group with an overview of the supply chain’s current state, including sales projections and the rollout plan for new initiatives. “The years that we were overseas in combat locations were good years as far as sales go. We’re getting back

8 | WWW.DEFENCEINDUSTRYREPORTS.COM


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Bespoke defence supply chain solutions for land, sea and air

LAND to a more normal situation as we move into the next few years here.” That situation includes a more than $1 billion drop in sales over the next few years. That is a lot less food to be transported overseas to soldiers working on operations.

Containerisation The predominant mode of transport of goods to Iraq and Afghanistan was and is in containers by sea. Only a small proportion of urgent materiel was airlifted in. Industry partners facilitated establishing the supply chain. The use of containers significantly reduces the number of man-hours required to move and account for the items within the containers. This has resulted in significant savings of time and money. Standardization also has led to intermodalism (the trans-shipping of cargo using two or more modes of transportation – sea, highway, rail, or air). Intermodalism and containerization facilitate and optimise cargo transfer without the need for intermediate handling of container contents. 9 Seaports throughout the world; manufacturers of container-handling equipment (CHE); and organizations dedicated to improving

container operations, such as the International Organization for Standardization (ISO) and the American National Standards Institute (ANSI), which develop appropriate containerization guidelines, have all adopted and now foster the use of standardised containers. TRANSCOM owns or leases almost all of the 20 and 40-foot containers used in the Defense Transportation System. MILVANs (military-owned, demountable containers) and SEAVANS (military containers moved by sea) fall into this category.10

SEA

Networked Supply Chain The first stage in securing a networked supply chain is knowing what was in the container and where it was. So RFID (radio frequency identification) has been used. Since 1993, the Army has been using (RFID) tags to gain inthe-box visibility for both deploying equipment and sustainment stocks. Use of RFID tags was a response to lessons learned from Operations Desert Shield and Desert Storm in 1990 and 1991. Since then, growth in the use of tags shows that RFID has become a very important part of today’s Total Asset Visibility plan.11

AIR

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 9


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Ensuring SMART Defence and an Assured Supply Chain Don McBarnet, International Security Correspondent

“You will not find it difficult to prove that battles, campaigns, and even wars have been won or lost primarily because of logistics.” Gen Dwight D. Eisenhower

In the process of modernizing their military infrastructure and related logistics, some countries are now moving away from ‘brute force logistics’, in which troops were responsible for sorting materials from huge inventories, towards a more efficient system that promotes precise accounting of consumption and replenishment in order to maximize efficiency

N

ATO AS an alliance of European allies and the United States is beginning to transform the way it approaches planning for future contingencies with limited resources. The NATO Support Agency, NSPA has changed the way it organises allied logistics. Logistics Operations, former NAMSA (NATO Maintenance and Supply Agency), will provide supply and maintenance support to NATO Operations; the CEPS Programme, former CEPMA (Central Europe Pipeline Management Agency), will transport and store fuel for its military and non-military clients and the Airlift Management Programme will support operation of its C17 aircrafts and the Heavy Airlift Wing (HAW). Capability and service delivery is preserved with in-house expertise and on-going support maintained.12

Software Supported Defence Supply Chains While airlift, sea containers and intermodal transport have been features of defence logistics for a while, the fastest moving trend is the development of software to manage the data generated from the movement of assets. One of many of these software programs is Freightsecurity. FWTracks is a secure, webbased GPS tracking and monitoring platform that provides 24/7 location visibility of cargo or assets. Location information is presented using Google Maps technology and is designed to push fast, high volumes of data. The software automatically provides notification when defined events occur. If the asset crosses user-defined boundaries for “safe zones” and “red zones” or if it starts or stops moving, users receive instant notification. This emphasis on managing the flow of data about the movement of important assets allows resilient and agile supply chain management. This quality of resilience and agility is critical to high levels of performance in complex projects,

10 | WWW.DEFENCEINDUSTRYREPORTS.COM

like military operations across the world or the building of large billion dollar defence platforms over extended time frames.

Lessons Learned from the Last 10 Years of Operations Brigadier Mark L Dunn, Head of support Chain Management, UK MOD, is previewed to make a series of salient points when he addresses a conference on military logistics in Kuwait in the Autumn of 2014. He underlines the overriding importance of working with industry collaboratively to ensure an agile and resilient supply chain. He stresses the need for visibility of quality data on the location and condition of assets. With any planned operation things go wrong and there is always a need to ‘prepare for the unexpected’. And he coins the catch phrase of commercial supply chain management by arguing for ‘availability of products’ rather than ‘the management of large inventories’. This supports the idea of “Just in time” rather than “Just in case”. Maintaining readiness of equipment even during times of austerity and peace is a necessity. He argues for planning maintenance operations to reduce downtime and determine materiel requirements. This enables effective logistics planning by forecasting maintenance and future requirements. This all means it is essential to incorporate mean downtime into maintenance and logistics planning activities.13

The Global Military Defence Logistics Market Projections The Global Military Defence Market 2012-2022 reported14 a shift from a supply-based system to a distribution-based system facilitated by increased use of software. The global defence industry is investing significantly in research and development in an effort to increase the logistical support capabilities of armies around the world. This has led to the use of new logistics


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Bespoke defence supply chain solutions for land, sea and air

LAND

SEA information software, which has enhanced the responsiveness of support providers, and has also enabled visibility of in-transit items in the military logistics supply chain. With the wide range of equipment that is being used, more civilian contractors are being brought in to deliver support services. This has resulted in common platformbased logistics systems in some countries, in order to enable vertical and horizontal integration at all levels of logistics. These software systems have ensured that all military and civil users view good logistics management information and therefore are enabled to make timely, data-driven decisions. Many armies across the world are expected to rely on private contractors to provide expertise in repair, maintenance, transportation, and inventory accountability.15 In the process of modernizing their military infrastructure and related logistics, some countries are now moving away from ‘brute force logistics’, in which troops were responsible for sorting materials from huge

inventories, towards a more efficient system that promotes precise accounting of consumption and replenishment in order to maximize efficiency. The report 2012-22 highlights that the military logistics industry is going through a process of rapid transformation. This transformation means that the supply-based system is gradually being replaced by distribution-based logistics. This shift is hoped to produce lower inventory costs, shorter lead times, enhanced responsiveness, enhanced survivability of the support infrastructure, and a reduced logistics footprint. The report outlines how in recent years there has been a growth in the development of Commercial Off The Shelf (COTS) products and technologies, by various defense companies engaged in the field of military infrastructure and logistics. Some major defense spenders such as the US and in Europe are moving to more advanced platforms, in an effort to increase the efficiency of the armed forces.16

AIR

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 11


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Delivering the Future Mary Dub, Editor

“Logistic considerations belong not only in the highest echelons of military planning during the process of preparation for war and for specific wartime operations, but may well become the controlling element with relation to timing and successful operation.” Vice Admiral Oscar C. Badger, USN (1890-1958)17

Military logisticians generally accept the potential advantages of a future logistics system that is highly networked and that is able to widely distribute real-time, actionable data on the battlefield

A

DMIRAL BADGER was prescient in seeing how logistics, now in the 21st century, have become the controlling element in a modern war. Logistics increasingly dominate issues of world trade and defence. To illustrate the importance of networked logistics operations, the World Bank logistics performance index (LPI) measures the level of performance of national logistics capabilities against a range of indices throughout the world.18 And of course, the efficiency of the supply chain in any sphere is only as good as its weakest link. The report highlights a gap between the performance of developing and other countries and notes the gaps in performance between countries of similar income levels against criteria such as efficiency of the clearance process like speed, simplicity and predictability of formalities by border control agencies, including customs. There’s the quality of trade and transport related infrastructure for example, ports, railroads, roads, information technology, and ease of arranging competitively priced shipments. Another dimension is the competence and quality of logistics operators, and their ability to track and trace consignments to achieve a timely and expected delivery. But one dimension of the process that has become increasingly salient is the software, which offers transparency to all parties while items are in transit.

the potential advantages of a future logistics system that is highly networked and that is able to widely distribute real-time, actionable data on the battlefield. However, the survivability of such a logistics information system has not been demonstrated in practice on the battlefield.19

DARPA’s UltraLog The UltraLog project’s goal has been to build an extremely survivable, agent-based logistics planning and execution information system for the modern battlefield. This is where an agent, or intelligent agent, is a software program that can perform many functions for a human computer user by applying a certain amount of reasoning. The difference between a commercial and defence logistics system is its need for security on the battlefield. DARPA has also recognised other features of importance. To ensure survivability under attack of a distributed logistics system there are three necessary components: robustness, scalability, and security. Robustness is the ability of a system to continue functioning when one or more of its components are destroyed or impaired. Scalability is the ability of a system to withstand massive increases in size and workload, such as might be encountered in going from peacetime operations to war. Security is the capacity of a system to maintain integrity and confidentiality, even when it is under directed information warfare (IW) attacks.

The Future of UltraLog

Network Security Under Cyber Attack

As Lieutenant Colonel James C Bates describes, information is a cornerstone of visions of future warfare. Programs as diverse as the Office of the Secretary of Defense’s Force Transformation program and the Army’s Future Combat Systems program envision a tight linking of operations, intelligence, and logistics made possible by extensive, shared, and widely distributed information. Military logisticians generally accept

UltraLog is secured by two key concepts agent system segmentation and dynamically reconfigurable, rule-based protective countermeasures. First, because of its globally distributed nature, UltraLog security is built on a unique framework of distributed trust that segments the agent society. Trust obstacles stand as sentinels between the segments and act to cordon off compromised segments, thus

12 | WWW.DEFENCEINDUSTRYREPORTS.COM


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

Bespoke defence supply chain solutions for land, sea and air

preventing damage from rolling unchecked throughout the system. Second, UltraLog incorporates a tight, policy-based security system. This system comprises a set of rules that is distributed throughout the system. Rules may be flexibly tailored to respond to changes in threat and are strictly enforced.20 As UltraLog reaches the end of its development cycle, many of the features targeted by the program have been achieved. This system would protect the data from a determined adversary and allow the United States working with its allies to achieve the military goal.21

The Science of Networked Logistics The pressures to modernise to achieve a competitive edge in the market place for logistics companies are being echoed in the demand for industry support for defence industries and ministries. In the commercial world, the supply chain has become the force that drives value.

The information system and management of data is central to the network design. Professor Wilding, Professor of Supply Chain Management at Cranfield University notes that assessing the key drivers is the key analytical insight. There is a marked contrast between the European market that may want affordability, but not at the price of responsiveness, whereas the African market may place affordability much higher in the scale of priorities. Logistics is becoming more finely honed. The aim is to deliver the perfect order experience through the supply chain. The ingredients might be order cycle time, inventory availability, order fill rate and order status information. And increasingly post-transaction, the availability of spares, the call out time and product tracing warranty are all-critical. The future of logistics is resilient, agile and networked with recognition of its importance integrated into the operation, military or commercial.

LAND

SEA

AIR

Contact T: 01536 454357 E: getintouch@wincanton.co.uk www.wincanton.co.uk DF/9/1.0/0614

WWW.DEFENCEINDUSTRYREPORTS.COM | 13


SPECIAL REPORT: GLOBAL DEFENCE LOGISTICS SOLUTIONS

References: http://www.richardwilding.info/blog/building-a-resilient-risk-free-supply-chain

1

Professor Richard Wilding OBE - Supply Chain and Logistics Expert, Professor at Cranfield School of Management http://www.richardwilding.info/

blog/building-a-resilient-risk-free-supply-chain#sthash.akFbjPTn.dpuf 2

Professor Richard Wilding’s blog on supply chain Building a resilient and risk free supply chain http://csis.org/files/publication/091217_Kuchins_NorthernDistNet_Web.pdf

The Northern Distribution Network and the Modern Silk Road

authors Andrew C. Kuchins Thomas M. Sanderson David A. Gordon December 2009

3

http://csis.org/files/publication/091217_Kuchins_NorthernDistNet_Web.pdf

The Northern Distribution Network and the Modern Silk Road

authors Andrew C. Kuchins Thomas M. Sanderson David A. Gordon December 2009

4

Despite Afghan war’s projected 2014 end, US still to foot much of bill for Afghan army By Jennifer Griffin Published May 22, 2012

http://www.foxnews.com/politics/2012/05/21/despite-pronouncement-end-to-afghan-war-in-2014-us-to-shoulder-burden-funding/ 5

http://www.bbc.com/news/world-asia-18691691 3 July 2012 Last updated at 19:54 GMT by Orla Guerin

6

New York Times US Logistics

http://www.nytimes.com/cwire/2009/07/27/27climatewire-the-pentagon-strives-to-tuck-in-its-long-log-39016.html?pagewanted=all

The Pentagon Strives to Tuck in Its Long Logistics ‘Tail’

By JESSICA LEBER of ClimateWire Published: July 27, 2009

7

8

http://www.dla.mil/dla_media_center/Pages/newsarticle201406301420.aspx DLA begins sale of excess non-military property to Afghans By Army Capt. Devon McRainey, American Forces Network Afghanistan

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/311638/20140506_JSP886_Vol3Part2_CLS_v2_18.pdf

JSP 886 DEFENCE LOGISTICS SUPPORT CHAIN MANUAL VOLUME 3

SUPPLY CHAIN MANAGEMENT PART 2 CONTRACTOR LOGISTIC SUPPORT

TRANSFORMATIONAL LOGISTICS

9 10 11

Containerizing the Joint Force by Lieutenant Colonel James C. Bates, USA (Ret.) http://www.almc.army.mil/alog/issues/marapr05/joint.html Containerizing the Joint Force by Lieutenant Colonel James C. Bates, USA (Ret.) http://www.almc.army.mil/alog/issues/marapr05/joint.html

http://www.almc.army.mil/alog/issues/marapr05/rfid.html

12

NATO SMART DEFENCE NATO SUPPORT AGENCY http://www.nspa.nato.int/en/organization/NSPA/faq.htm

13

Brigadier Mark L Dunn Head of Support Chain Management, conference speaker Military Logistics Kuwait

UK MoD http://www.militarylogisticskuwait.com/SpeakerInfo.aspx?tp_spkid=92558

14

Global Military Defence Market 2012-2022 http://www.defencetalk.com/global-military-infrastructure-logistics-market-2012-2022-42967/

15

Global Military Defence Market 2012-2022 http://www.defencetalk.com/global-military-infrastructure-logistics-market-2012-2022-42967/

16

Global Military Defence Market 2012-2022 http://www.defencetalk.com/global-military-infrastructure-logistics-market-2012-2022-42967/

17

In 1942 as Rear Admiral, he was Commander Destroyers Atlantic Fleet and subsequently Assistant Chief of Naval Operations for Logistics Plans. In February 1944 he became Commander Service Squadrons South Pacific and in October Commander Battleship Division 7. Badger was the first Navy officer to step ashore in Japan at the end of World War II.

18

World Bank international logistics comparison score chart 2014

http://lpi.worldbank.org/international/scorecard/column/254/C/GBR/2014/C/DEU/2014#chartarea 19

20

21

http://www.almc.army.mil/alog/issues/marapr05/Ultralog.html UltraLog: Securing Logistics Information on the Battlefield by Lieutenant Colonel James C. Bates, USA (Ret.) http://www.almc.army.mil/alog/issues/marapr05/Ultralog.html UltraLog: Securing Logistics Information on the Battlefield by Lieutenant Colonel James C. Bates, USA (Ret.) http://www.almc.army.mil/alog/issues/marapr05/Ultralog.html Commander James C. Workman, USN (Ret.), is employed by Los Alamos Technical

Associates, Inc., in Sterling, Virginia. Commander Workman served 20 years in the Navy Supply Corps, culminating in joint tours at the Office of the

Secretary of Defense and the Defense Logistics Agency.

14 | WWW.DEFENCEINDUSTRYREPORTS.COM


Defence Industry Reports… the Defence Industry Reports….the leading specialist combined leading specialist online research andcombined networking online research and networking resource for senior military and resource for senior military and defence industry professionals. defence industry professionals.

• Up minute Industry News other content available • to Upthe to the minute Industryand and Technology Technology News andand other content available to to allallsite users on a free of charge, open access basis. site users on a free of charge, open access basis. • Qualified signed upupmembers abletoto access premium content • Qualified signed members are are able access premium content SpecialSpecial Reports andand interact with usinga variety a variety of advanced Reports interact withtheir their peers peers using of advanced onlineonline networking tools. networking tools. • Designed to help usersidentify identify new solutions, understand the the • Designed to help users newtechnical technical solutions, understand implications of differenttechnical technical choices select the the bestbest solutions implications of different choicesand and select solutions available. available. • Thought Leadership Advice and from internationally recognised • Thought Leadership – -Advice andguidance guidance from internationally recognised defence industry key opinion leaders. leaders defence industry key opinion • Peer Input - Contributions from senior military personnel and defence industry • Peer Input – Contributions from senior military personnel and defence professionals industry professionals. •

Independent Editorial Content - Expert and authoritative analysis from award

Unbiased Supplier Provided Content

Designed to facilitate debate

• Independent Editorial Content – Expert and authoritative analysis from winning journalists and leading industry commentators award winning journalists and leading industry commentators. •

Unbiased Supplier Provided Content.

Designed debate. • Writtento tofacilitate the highest professional standards

Written to the highest professional standards.

Visit: www.defenceindustryreports.com


Defence Industry Report – Global Defence Logistics Solutions Wincanton  

Defence Industry – Special Report on Global Defence Logistics Solutions

Defence Industry Report – Global Defence Logistics Solutions Wincanton  

Defence Industry – Special Report on Global Defence Logistics Solutions