Systems Reveille: Model Systems Standardization Project Keeps the DoD on Time and on Budget

The Department of Defense (DoD) distribution depots are responsible for supplying all branches of the Armed Services. Before 1992, each depot was isolated with its own inventory, accounting and shipping and receiving systems -- making it difficult to locate hard-to-find items without numerous phone calls. The DoD recognized the need to consolidate all the depots for an efficient and ultimately cost-saving system.

The Defense Distribution Systems Center (DDSC) is responsible for the development and deployment of the Distribution Standard System (DSS) to all Defense Logistics Agency (DLA) distribution depots, as well as for the maintenance of legacy (existing) distribution systems until they are replaced by DSS.

Traditionally, each Department of Defense (DoD) depot operated separately, with individual inventory, accounting and shipping and receiving systems. If someone needed a difficult-to-find item, the only way to search for that item was to place individual phone calls to each of the depots, wasting time and dollars along the way. Today, interaction and cooperation among the various Armed Forces has increased substantially as the DoD transitions its infrastructure to best meet evolving national security requirements. This evolving infrastructure makes consolidation a top priority.

The DoD initiated the Distribution Standard System program in 1992, a multi-year, multi-million dollar effort to achieve overall savings through depot system consolidation. Lifecycle benefits are projected to be almost $500 million, yielding a more than 5:1 return on investment.

"DoD is committed to eradicating redundancies and deploying the most cost-effective, best-of-breed solutions available," states James Sanchez, Program Manager, DDSC. "This effort is concrete evidence of real steps we are taking towards a better, faster, cheaper government."

Taking Stock

DLA's primary goals were to improve inventory accuracy, workload planning, stock receiving, packing, shipping, transportation, hazardous materials handling and storage location management - not a small undertaking.

"Our marching orders were to deliver the productivity enhancements and functional process improvements needed to meet DoD-directed cost reductions by putting industry best business practices in place and leveraging information processing technology," states Sanchez. "Our first challenge was how to manage the effort."

The task of keeping more than 49 government civilian personnel, supported by three major contractors, the Office of the Secretary of Defense (OSD), the individual Services and DLA field activities on track and on budget was a significant task in and of itself - and would be the deciding factor between project success and failure.

Together, the DDSC team shared responsibility for: overseeing design, development and testing of DSS increments; assuring the DSS meets user requirements; planning and conducting testing; planning and overseeing, both user training and deployment of DSS to 21 sites; resolving interface issues with Military Services, managing program, cost, schedule and performance; assuring effective DISA support; and software development and implementation support from the DLA System Design Center (DSDC). In addition, the DDSC team needed to plan systems architecture for the future and manage the former Military Service legacy systems until they were retired.

"We believed, from the beginning, that effective program management would be critical," states Sanchez. "An effort this complicated could easily have strayed off target. We looked for structured, proven business processes that would help us meet our goals as efficiently as possible."

System development and replacement at 21 depots posed a number of unique challenges. "Each Military Service naturally felt that their system was the best solution," explains Sanchez. "We worked to take the best from each to build DSS, and then to clearly communicate the benefits of consolidation throughout the DoD. Our goal was to provide centralized, consolidated data and eliminate the redundancies of having six different systems dedicated to essentially the same task."

Determined to make the best use of resources and deliver DSS on time and on budget, the DDSC turned to Robbins-Gioia Inc. (Alexandria, Va.). Together with Robbins-Gioia, the DDSC team utilized a variety of program management methodologies to keep the DSS program on schedule and within budget.

"Program management provides us with a snapshot of what is ahead," explains Sanchez. "We can anticipate and react before something is so far off track that other components of the program are affected. This is critical to staying on budget. If we get a week behind schedule, the total cost can be as much as $250,000. If we fall a month behind - the cost could be $1 million. Program management enables us to model functional and systems capabilities that will enable us to meet our goals better and cheaper."

Program Control

DDSC knew that a good configuration management program was key to success. "The DDSC functional analysts relied on our program management data to maintain control and integrity of the baseline," explains John Enloe, Program Manager, Robbins-Gioia. "This data enabled them to ensure that the configuration management process and procedures were maintained throughout the life cycle of the program."

The OSD Major Automated Information Systems Review Council (MAISRC) monitors program status. The program manager is constantly reviewing and updating documentation, including the Test and Evaluation Master Plan (TEMP), Telecommunications Plan, Acquisition Program Baseline, Security Plan and the Acquisition Plan. These documents, along with briefings, are used by higher authorities to track and monitor the status of the DSS program. The DSS program received MAISRC Milestone III approval to continue deploying DSS to the former Military Service sites. This milestone involved updating the life cycle documentation, obtaining approvals, preparing a System Decision Paper (SDP) and resolving Service interface issues through a series of Working Level Integrated Product Team (WIPT) meetings with the Army, Navy and Air Force.

Work Breakdown Structure

DDSC worked with Robbins-Gioia to develop and deploy a Work Breakdown Structure and an automated planning tool to support the integration of tasks to be performed, planned resources and costs of each activity to develop and deploy DSS. Using this automated process, the team could capture and validate the actual labor-hours worked and measure progress against the plan. In addition, detailed analyses of alternatives could be performed, providing management with the impact on cost and schedule, to aid in making informed decisions.

Another analysis technique used by the DSS team is Cost/Schedule Status Reporting, which enables Earned Value Analysis. Earned Value, a current mandate in many government arenas, can mean nothing more than assessing and tracking the resources consumed at various points in the program, but at DLA it is used within a comprehensive program management framework to maintain cost visibility throughout the life cycle. The tool is primarily used by the team to provide the DSS Program Manager with an independent measure of progress.

Cost Analysis

Another critical area of program management support is estimation of life cycle costs and benefits for the DSS program. This process includes defining all aspects of the program's life cycle, including system operation and support costs. In addition, functional improvements are identified and quantified to determine the economic feasibility of the program implementation. These efforts culminate in the DSS Economics Analysis (EA), which serves as the program's baseline and permits the team to conduct trade-off and what-if analyses for future portions of the program.

Robbins-Gioia analysts also provide support in developing the program office budget and Program Objective Memorandum (POM) documentation for out-year requirements, as well as tracking daily obligations and expenditures.

DDSC deployed cost analysis tools across the program, including one for the Defense Information Systems Agency (DISA) processing and telecommunications support to DLA. The resulting report identified billing errors for correction, educated DLA HQ and field top managers on the components of DISA billing and projected future DISA costs based on expected DLA workload. The analysis was also useful to DISA in planning for DLA revenues. The actions from the telecommunications portion of the analysis are expected to save $1 million per year. The DDSC team initiated monthly executive meetings with the Defense Information Systems Agency (DISA) to review and improve system processing support to the depots, and the results have been remarkable. DISA's number of late processing days has been reduced dramatically through DDSC efforts. The team also targeted DISA processing performance, and by teaming with DISA, was able to improve availability from 89 percent to 99.9 percent in January 1997. The team is continuing to work with DISA in an effort to reduce operations costs.

Management Information Services

The Management Information Services group is responsible for the development, automation and maintenance of DDSC's program management applications. These applications include an Executive Information System (EIS), the DDSC Automated Budget System, a Travel Order Tracking System and the DDSC Home Page.

"The DSS development and implementation effort is an integrated government/contractor team endeavor," states Sanchez. "This environment of government and industry working side-by-side to deploy best value solutions is truly the model for the future."

Rising to the Challenge

The road was not always a smooth one for the DDSC team. Taking DSS to the first DLA depot, which was co-located with a Service maintenance depot, was a major task. A serious challenge arose because the Military Service systems were not compliant with DoD military standards (MILS). The two systems needed a way to communicate. DDSC soon rejected the option of asking the Services to become MILS compliant, since the estimated cost of that option was $18 million. DDSC and DSDC were able to work out a solution by building a translator, or bridging software, to convert transactions passing between DSS and the Service system. This was a lower-cost solution ($1 million) that allowed DDSC to stay on schedule.

The DDSC's willingness to partner with field activities by sharing information, planning and assigning responsibility has also been key to success. DDSC meets early with each site to present information about DSS and receive information on site business processes. They utilized a DDSC-developed Plan of Actions and Milestones (POAM) framework to build a unique POAM for the site. Each POAM is large and complex, but lays out the sequence of implementation events, due dates and responsible parties. POAMs are available online for updating and viewing, and DDSC holds in-process review video teleconferences with the Regions and Depots to assess progress and solve problems.

From the start of the DSS program, OSD established firm budget and schedule goals for the team to achieve during development and deployment. The DDSC team has not only achieved those goals, but also delivered more efficient and responsive distribution support to the Military Services.

"The depth and breadth of the team's knowledge and experience have been invaluable," states Sanchez. "The team has a unique blend of depot management and system capabilities, which allows them to plan, organize and execute enormously complex site implementations. Their insights into what is required to operate a depot have allowed the DSS program to make the most effective use of DoD resources and to successfully implement DSS at 18 depots to date. The implementations at the former Army depots went so smoothly that an Army Material Command representative reported that they were transparent to the Army; they saw no interruption or degradation in support when DSS was implemented."

The DSS team utilized Working Integrated Product Teams to pull together experts from OSD, DISA, the Military Services and DLA (DSDC, Defense Distribution Center and Depots) who could address a broad spectrum of complex issues, including development and implementation schedules, security and systems issues. The IPTs resulted in a clear plan and understanding by all parties and decision-making authority at the lowest possible level.

System Overview

DSS has been deployed at fifteen distribution depots across the country, with the number increasing constantly. Built in APS-generated COBOL II (4GL) and running on an MVS.ESA (OS390) operating system upgrade, the system will store data in CA Datacom 8.1, an SQL-compliant Relational Database Management System (RDBMS). The system incorporates more than 10,000 terminals, with data processing hubs located at two DISA Megacenters. Several commercial software packages have also been incorporated.

Progress in Action: DSS Delivers

"DSS sets an example," states Sanchez. "Deployed with precision and purpose, we are confident the system will continue to deliver against stated objectives."

Significant DDSC team results include:

• Resolving major interface issues and concerns with the Military Services.

• Successfully testing and implementing DSS Increments 7.1 at the former Army depots, 7.2 at the former Air Force Depots and 7.3 at four of the former Navy depots.

• Developing a new DISA cost-estimating methodology for use in budget projections.

• Implementing a new capability to provide requisition status to DLA customers via the Internet.

• Managing seven legacy systems successfully and keeping them operational with minimal levels of maintenance.

• Developing new and better methods of training employees to use DSS.

• Applying lessons learned from earlier development, testing and deployments.

In addition to focusing on today's business, the DDSC team is working continually to achieve better future systems architecture for the DoD distribution business, which will reduce DLA's operating costs. By working with field activities to identify and prioritize changes to the system, the DDSC team significantly increased productivity, saving millions of dollars each year.

While standardizing DLA's distribution system through DSS, the DDSC team brings many process improvements, including inventory accuracy, workload planning, stock receiving, packing, shipping, transportation, hazardous materials handling and storage location management.

One module of DSS, the Automated Manifest Systems, provides visibility of stock in transit and the Army has already seen major savings in their material receiving operations in Korea, Haiti and Bosnia. The standard system puts DLA's distribution depots on par with industry best business practices and helps the depots improve support to customers - the Military Services warfighters. For example, the DLA Primary Distribution Site in Pennsylvania set another new production record by handling 778,000 customer orders and receipts during the month of March 1997 - an average of 37,000 per workday. High priority orders are processed in four hours and routine orders in less than two days. The cost per receipt or issue may also be the lowest on record for defense depots.

Today, all of DLA's distribution business volume is operating under DSS. Through DSS, the DDSC team is providing a platform for DLA to move from traditional receipt, storage and issue of material to tailored logistics support. DSS strengthens the management of the distribution function by adding process control and warehouse discipline. In addition, it is technically current and scalable to meet future DoD distribution needs.

"The DDSC team exemplifies the highest standards of teamwork, effective program management, sense of purpose and a high level of excellence in performance and productivity - all focused on enabling the government to work better and cheaper," states Sanchez. "The future has arrived."

Nicole Burdette is a freelance writer based in Media, Pa.

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