A HALF-CENTURY OF SUPPORT
really do stress reducing our operating costs and trying to make that as low as we possibly can. One of the things that we put much more emphasis on in the last couple of years is the price we pay to industry and trying to get the abso- lute best price. We saw an opportunity because for the last decade, most of the emphasis was on the effectiveness of DLA support and maybe not quite as focused on the efficiency. Part of it was also Dr. Ashton [B.] Carter, Under Secretary of Defense for Acquisition, Technology, and Logistics, who introduced his Better Buy- ing Power Initiative, and so we looked and asked, “How can we do our part?”
We’ve really ramped up our efforts in try- ing to get a better deal from industry, and we have a number of different techniques, from greater use of long-term contracts, a lot of efforts in price negotiation for our acquisition personnel, and a number of different tools. A year ago, we essentially went public with our supplier base—and DLA buys from thousands of organiza- tions—and told them, here’s the new deal: When we buy something from you the next time, we want to pay 10 percent less than we paid the last time.
Q. Can you be specific about areas in which competition is easier to find than others?
A. It really depends on the commod- ity. Clearly, in subsistence it’s very easy. There’s typically a large industry group in the food service distribution business, so typically it’s very competitive with respect to pricing. In the hardware area, it depends. If it is an item that, due to say, engineering drawings, is really a sole- source [contract] for life, then obviously you’re kind of stuck there. But in many cases we find that we’ve been able to suc- cessfully break those out from the OEMs [original equipment manufacturers]. And
68 Army AL&T Magazine
PROBABLY ONE OF THE GREATEST LESSONS LEARNED IS THAT WE REALLY HAVE TO HAVE A MUCH MORE CAPABLE PROFESSIONAL CONTINGENCY CONTRACTING CAPABILITY TO SUPPORT ANY FUTURE CONTINGENCY.
where you have the technical data, it’s really a wide-open field. Medical supplies [are] very competitive; I think we get very good prices. The fuel product is kind of a global market, and that’s very competi- tive, where you’re paying for associated services to operate facilities or do delivery and so forth. There are typically a number of companies that can provide that, and regardless of where we are in the world, we almost never have a sole-source con- tract in that area.
For the most part, the nature of DLA business is very competitive, and therefore a high percentage of our total contracts are competitively awarded. That’s very, very helpful.
Q. What are some of the challenges related to stewardship efforts?
A. The next decade is going to be very different from the last decade. The last decade was all about, “Support the war- fighter, support the warfighter, support the warfighter,” with a great deal of rapid change in the support requirement; it was largely about effectiveness of sup- port. But now, with the federal budget and the defense budget under enormous
pressure, DLA is going to be looked to to try and really squeeze cost out of the logistics support.
I think the big challenge for us in steward- ship is really taking all of our efforts to the next level. Nothing’s easy, and in almost everything we’ve tried, you run into fric- tion points for many different reasons. Either you’re asking people to do things differently, or you’re asking something from industry that maybe they don’t per- ceive as being in their own best interests financially, or you just go about something in a different way. I think that what we’ve done in the last one to two years has really been breakthrough learning that we can apply with greater energy over the next several years. There’s no question that we’re going to have to squeeze out more costs.
It also means that I think we’re going to have to get tighter [in] each of the ser- vices, Army in particular, looking at what logistics functions are done in the service versus DLA, and could DLA add value and reduce logistics support costs for the service if we did more for them. There’s already a pretty active dialogue on the part of the Secretary of Defense’s staff with each of the services. We have a very close
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