News | Aug. 26, 2019

New DLA guidance outlines steps for reducing production lead time 

By Beth Reece

After a multiyear effort improving pre-award contract time, the Defense Logistics Agency is turning its focus to reducing post-award production lead time.

“We’re getting back to the basics and looking hard at measures we can take to get parts in customers’ hands faster,” said Glenn Starks, DLA’s chief of acquisition programs.

PLT measures the time it takes supplies to be receipted by a distribution depot or customers after orders are placed and is based on contract shipment terms. According to DLA guidance scheduled to be released early September, the goal is to reduce PLT by 25% from the last time a contract was awarded. Though items on LTCs already have a quick PLT because suppliers are kept informed of demand patterns and production lines are already in place, their PLT can also be improved, Starks added.

“Customers ordering things like food and medicine that we get through prime vendors and long-term contracts can usually get them on-the-spot the next day. Otherwise it can take a while, especially if we’re buying a part for an old aircraft and the production line has to be built from scratch because none exist,” he said.

About 5% of the items DLA procures are not on LTCs or automated awards, which incentivize suppliers to deliver items quickly and at the lowest cost, because they have low or unexpected demand. DLA Acquisition and DLA Logistics Operations recently conducted a Continuous Process Improvement project with the help of an independent party to outline obstacles to efficient lead times for such items.

“We went out and did interviews with the MSCs [major subordinate commands], testing facilities and suppliers to analyze the entire process and determine what some of the roadblocks are in getting our PLT down,” Starks said. “One of the obstacles we found was the reluctance to accept that a lot of the delay is actually caused by the government itself.”

Often mistaken as suppliers’ responsibility, PLT is a four-step process that includes post-award administration, manufacturing, testing and inspection, and delivery acceptance that involves multiple players ranging from acquisition specialists and suppliers to inspectors, military engineering support activities and the Defense Contract Management Agency.

The agency expects to improve PLT by quickly processing contract modifications in the post-award stage, timely validation of technical data and other measures.

“We have to make sure we’re providing the right technical data in the contract up front,” Starks said. “If it’s for a part we haven’t bought in five years and it’s not up-to-date, that holds the process up and the clock continues ticking while we rush to get the correct data.”

In some cases, PLT is slowed by first-article testing requirements in which the design and manufacturing process is verified for a particular part. The process can take three to 18 months, but technical quality specialists are being encouraged to challenge cases where first-article testing shouldn’t be used and to replace lot testing with approved vendor process controls where applicable.

Acquisition specialists will also work with DCMA to ensure testing and inspections are conducted on time, as well as expedite resolution of testing failures.

“It’s easy to be a tester and say, ‘My job today is to go out and test. I’ll be there by noon; I’ll be done by 4 p.m. Oh, I’m a little bit late because of traffic.’ But testing is a critical piece. Any holdup anywhere throughout this process will delay subsequent actions and make the overall PLT longer,” Starks said.

Items delivered overseas have additional challenges, added Brian Wilt, a procurement analyst on Starks’ team.

“Overseas orders are sent to a consolidation point and get put on pallets for shipment but might sit for days before there’s a big enough shipment to actually be sent out,” Wilt said. “Then, how quickly can the services pick it up and have time to say they’ve accepted it?”

Reducing PLT helps warfighters and supports DLA’s industry engagement efforts.

“We’re trying to increase our market intelligence, be more proactive and have a more open dialog with industry as well as our DCMA and service partners,” Starks added. “It’s all about greater collaboration for those we sell to, buy from and work with to meet customers’ needs.”

Input from employees in contracting and quality control throughout DLA helped make the new DLA guidance possible, he continued. Once signed, the document will be distributed through supervisors or employees can get a copy at the DLA Issuances website (a Common Access Card is required for access).