FORT BELVOIR, Va. –
Editor's Note: This is the second story in a two-part historical series on DLA's journey to managing most consumable items for the services. Read the first half: Consumable item growth at DLA: From 39% to 67%.
The Defense Logistics Agency’s management of consumable items rose from 39% of the military’s expendable inventory in 1962 to 67% three decades later due to steady accretion and one massive transfer. The same pattern would occur on an accelerated timeline over the next decade and a half. As before, assumption depended on communication between the agency and services, as well as both parties and the Office of the Secretary of Defense.
Growth continued when Defense Secretary Dick Cheney needed to adjust military structure after the Cold War. While some restructuring came as a result of Joint Chiefs of Staff force reductions, most logistics-orientated change emanated from the secretary’s Defense Management Review Decisions. DMRD 926, for example, ordered the 1.2 million consumable items still managed by the services transferred to DLA. Cheney expected this move to save $32 million and reduce the Defense Department by 10,500 employees.
Multiple reorganizations made it difficult to determine the transfer’s effectiveness. Other management review decisions, the 1990-1991 Gulf War, and Base Realignment and Closure rounds confused efforts to track savings. At the same time, a reduction in transfer quantity lowered expectations. The services, trying to control the rate at which their forces contracted, accepted the loss of items but not missions. They negotiated OSD down from 1.2 million consumables to 939,000 – 465,000 from the Air Force, 273,000 from the Navy, 199,000 from the Army and 2,000 from the Marine Corps.
DLA began cataloging these consumables Jan. 1, 1991, and receiving them Aug. 1, 1991. Transfers occurred in two phases: the first, for 756,000 items, covered basic items; the second, for 171,000 items, complex ones. According to the Defense Department Inspector General, it took longer than expected for DLA to realize efficiencies in Phase 1 because the services held onto responsibilities. While prompted by a desire to ensure uninterrupted support, their hesitancy doubled work, led to overordering and hindered requirements prediction.
Phase 2 also had problems. While numbering only a fifth of Phase 1 transfers, the second tranche included complex items such as parts for nuclear reactors. By the time the three-year transition ended, supply availabilities for DLA’s newly acquired commodities averaged 74% for the Army, 60% for the Navy and 58% for the Air Force. Like Phase 1 problems, those in Phase 2 stemmed from the services withholding information and responsibilities. Also like Phase 1 problems, they were temporary. After the services released the final 41,300 items, problems disappeared and DLA’s share of military consumables rose to 90%.
DLA’s consumable item management remained constant until the 2005 Base Realignment and Closure round. This BRAC, mandated by the 2002 National Defense Authorization Act, transferred both reparables and most of the services’ remaining consumables to DLA. Memory again played a distorting role, this time negatively. Army logisticians, citing Defense Department Inspector General reports released before numbers settled, claimed the 1990s transfers had caused “significant disruption.” Facing a smaller loss, however, they and other service logisticians directed their ire against reparables and let the consumable item transfer proceed.
The services may have accepted the BRAC transfers because they did not involve physical movement. Warehouse consolidation, one of the reforms of the mid-1990s, meant the agency already stored much of what it was about to receive. Little has changed since. The agency remains responsible for almost all military consumables today, with the services managing items only when OSD’s senior logistician grants exceptions for performance-based contracts or unstable designs.
OSD has been the driving force behind DLA’s consumable item growth since it assigned the agency commodity supply centers in 1962. Senior logisticians in this office consolidated consumables under DLA because they thought a single headquarters could save money. It did, but only on the margin. In 1996, for example, consumable items outnumbered reparables four to one but accounted for only 27.3% of the military’s secondary item expenditure. In another example, the 47,000 items transferred under BRAC 2005 saved only $9.4 million.
The services fought to retain these inexpensive items when transfers were large, opposing plans, getting OSD’s senior logistician to decrease quantities and delaying execution. To the degree their motivations can be discerned, they were not trying to handicap the agency but worried about the diminution of their logistics arms, each with a long and proud history. When the services eventually dropped their reticence, DLA realized the efficiencies expected of it. In time, logisticians throughout the military equated consumables with the agency. Logistics services and other item responsibilities aside, DLA is known today as the Defense Department’s consumable item manger.