News | Oct. 11, 2017

Logistics Stock Exchange opens a world of possibilities for DLA order fulfillment

By Dianne Ryder

The Defense Logistics Agency has recently increased its support to the North Atlantic Treaty Organization by making DLA items available in a database where NATO member and partner countries buy and sell more than 6 million items.

Since July 1, DLA has taken part in the NATO Logistics Stock Exchange, a web-based program that identifies assets DLA can purchase from participating nations. The NLSE is managed by the NATO Support and Procurement Agency.

To use NLSE, nations must become members of the Common Item Materiel Management partnership. To join COMMIT, DLA had to gain permission from the undersecretary of defense for acquisition, technology and logistics, said Adrienne McGeachy, the U.S. representative for NLSE in the DLA Logistics Operations Order Management Division.

“That’s when the Office of the Secretary of Defense and the Department of State became involved, because we had to get approval from them to be the representative for the United States,” she said. “We’re not just representing DLA; we’re the representative for all of the United States for any NLSE activity.”

McGeachy said DLA went through the silent approval process, which means all of the other nations had a chance to vote or abstain. Then DLA was unanimously accepted.

COMMIT’s other full members are Belgium, Canada, Denmark, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, the Netherlands, Norway, Poland, Portugal, Slovakia, Spain, Turkey and the United Kingdom. Associate members are Austria, Sweden, Finland and Ukraine.

“Once a request is submitted, it goes through the COMMIT partnership, all the nations vote, and then there’s a 60-day wait,” McGeachy said. “It took a while to stand up the program, but we wanted to make sure that we got it right and had the right folks in place.”

Many years ago, DLA implemented a pilot program with NLSE, McGeachy said.

“Based upon the pilot, [DLA] decided not to continue,” McGeachy said. “But in May 2014, we were given direction from [former DLA Director] Adm. [Mark] Harnitchek and the Executive Board to reengage and join.”

John Ampela, Order Management Division chief, said DLA had several forays into pilot programs, but it wasn’t until 2009 when the agency briefly became a member.

“DLA Europe and Africa had a keen interest in it because they get a lot of feedback from the services that this could be helpful in the EUCOM Theater,” he said. “But there are bigger applications than in the EUCOM Theater.”

Membership in NLSE provides an opportunity to fill back orders and to collaborate with partners in the theater, Ampela said.

“It’s a new avenue for alternate means of support, other than the standard procurement,” he said.

Ampela noted some alternate supply actions that DLA can perform when reviewing lists of back orders.

“If planning and procurement miss the mark and we don’t have stock on hand or a contract to support, but [the need is] urgent, we want to look toward other means of supply,” he said. These include:

  • Inventory Locator Services: A U.S. surplus marketplace. “I would look for surplus that vendors had bought from DLA or other government partners for government parts, national stock numbers — and I could actually buy it from those surplus dealers if I can prove traceability,” Ampela said. “We can buy it back from those vendors to support a back order.”
  • Organic manufacturing: For example, at Tinker Air Force Base, Oklahoma. “They can make certain parts or reengineer them,” he said. “If they have the specifications, they can produce it to spec.”
  • Davis-Monthan Air Force Base, Arizona (“the Boneyard”): The 309th Aerospace Maintenance and Regeneration Group retrieves parts from planes sitting unused in the desert, Ampela said. “We can cannibalize a part from a decommissioned aircraft or weapons system.”

The NLSE adds to DLA’s alternative sources of supply. Ampela likens it to an online NATO international auction site for military surplus.

“It’s just another tool in the toolbox for the supply chains to improve their materiel availability and to have other means of getting assets to fill our customers’ needs,” he said. “By working with NLSE, it opens up a whole other inventory for our customers.”

“We’re also exploring the possibility of using NLSE to sell excess inventory,” McGeachy said. “DLA disposes of quite a bit of inventory, and it would be another chance for us to recoup some of the funds for the organization.”

McGeachy said she and the team are excited about the opportunity to partner with NATO, and NLSE provides inventory visibility to all members.

“NLSE also gives you access to NATO contracts and agreements that they have, so it opens up yet another door for us to be able to meet our customer needs if we don’t have a current source,” she said. “NLSE gives our customers that are in theater with unique items only sold in theater an opportunity to get them in a timely manner.”

The COMMIT partnership meets twice a year: once at the NSPA headquarters in Capellen, Luxembourg, and the other at a participating nation’s location. Ampela attended the Luxembourg meeting last fall and said he became an advocate of the program.

“When I came back, I realized it’s more than just buying parts from each other; this is a forum for partnership building, coalition building and building relationships between nations,” he said. “We’re coming together as friendly nations and trying to collaborate and assist each other in common goals — that was my biggest takeaway.”

Ampela said DLA is trying to build better, more supportable processes.

“[The process is] more mature now, and hopefully it will become economical and cost effective to use NLSE. The Enterprise Business System has evolved quite a bit, and NLSE’s website has evolved, so it’s much easier to buy and sell inventory,” he said. “The timing is better now for this to succeed and be of help to DLA in warfighter support.”

The team has selected some candidate NSNs from the major subordinate commands and will soon perform a proof of concept, Ampela said.

“We’ll take a few items from each supply chain that are available on the NLSE, buy them and make sure that we can get the item purchased, delivered to the customer and paid for through the EBS and NLSE,” he said.