Anticipatory Logistics:  The Army's Answer to Supply Chain Management

by Major Joshua M. Lenzini

    The Army is experimenting with the concept of anticipatory logistics for class III (petroleum, oils, and lubricants), class V (ammunition), and maintenance. Anticipatory logistics uses technologies, information systems, and procedures to predict and prioritize customer requirements and provide appropriate sustainment. Although this sounds simple enough, future logisticians will use current and future technologies as tools to monitor supply levels and equipment conditions for combat units. They also will use decision support software to determine the best use of combat service support assets. How is this concept related to the supply chain management (SCM) technique that corporations use?

Supply Chain Management

    In the winter 1988 issue of Supply Chain Managemet Review, Peter J. Metz defined SCM is "a process-
oriented, integrated approach to producing, procuring, and delivering products and services to customers. SCM has a broad scope that includes subsuppliers, suppliers, internal operations, wholesale customers, retail customers, and end users." It also covers the management of materiel, information, and funds. SCM encompasses the entire process from raw materials to the final
customer.

    To better understand the concept of SCM, we need to visualize what a supply chain is. A supply chain is made up of all the manufacturers and suppliers who provide the parts that make up a particular product. It includes production, storage, and distribution activities that procure materials, transform the materials into intermediate and finished products, and distribute the finished products to the customer. Supply chains exist in both service and manufacturing industries. However, the complexity and organization of supply chains vary immensely from industry to industry and from organization to organization. In practice, supply chains have multiple products with the potential of many shared components, facilities, and capacities.

    While SCM and the supply chain seem to be very similar, the most notable difference is that SCM is a process that integrates and synchronizes the supply chain to meet an organization's goals and objectives. The chart on page 4 illustrates a corporate SCM conceptual model. SCM has seven components and six essential success factors. The seven components are—

The six essential success factors are—

    The dilemma that management in industry faces is how to satisfy two diametrically opposing forces: the customers' demands for better, faster, and less costly products and services and the organization's need for growth and profitability. To meet both requirements, business organizations use SCM.

    Consumer expectations concerning service, speed, cost, and choice will continue to rise. The business trend is to provide consumers with what they want faster than any competitors can, at a price lower than the current market price, and in real time. SCM organizes the overall business process to enable the profitable transformation of raw materials or products into finished goods and their timely distribution to meet customer demands.

 
Supply chain management is similar for both corporate (shown left) and military (shown right) organizations. However, some significant differences are evident in these models. The first is the absence of maintenance on the corporate model. Another is that transportation, distribution, and warehousing are unidirectional in the corporate model but dual directional in the military model. Note, also, that the external factors differ between the two types of organizations.

 

 

External Factors: Globalization, Government regulations, environment, and competition.

External Factors: End-user need, DOD regulations, environment, joint interoperability, deployment within and outside the continental United States, mission requirements.

External Factors: End-user need, DOD regulations, environment, joint interoperability, deployment within and outside the continental United States, mission requirements.

Supply chain management is similar for both corporate (shown left) and military (shown right) organizations. However, some significant differences are evident in these models. The first is the absence of maintenance on the corporate model. Another is that transportation, distribution, and warehousing are unidirectional in the corporate model but dual directional in the military model. Note, also, that the external factors differ between the two types of organizations.

Military Version of Supply Chain Management

    For military logistics operations, SCM has seven components and seven essential success factors. SCM for the Army is slightly different from SCM for corporate organizations because the Army's focus is on mission requirements rather than on quarterly earnings. The seven components of SCM for the Army are the same as for business—

The Army's seven essential success factors are—

    The SCM conceptual models for both business and the Army are remarkably similar; however, there are some significant differences. Most notable are the dual directional arrows on the chart for transportation and for distribution and warehousing in the Army SCM model. These illustrate that the Army may retrograde equipment and components for maintenance or retrograde personnel for medical care. Other differences are in the external factors that affect the supply chain. These factors include—

The supply chain reflects the Army's focus on mission accomplishment as opposed to business' focus on
profitability.

Anticipatory Logistics

    Like the corporate world, the Army faces two diametrically opposing forces: the need to support combat maneuver forces better, more responsively, and at a lower cost and the need to reduce the logistics footprint of the Army's future forces. The Army is exploring how to better support brigade combat teams (BCTs) by using some underlying SCM concepts, such as information and communication technologies, order management, and transportation using current and new technologies.

    By using the "tactical Internet" to achieve situational awareness, future logisticians will be able to track the status of supplies for individual units and better predict the needs of combat units. Systems that provide logistics leaders enhanced situational awareness will provide instantaneous supply status, predict component failures, and even provide two-way messaging. Sensors in both combat and combat service support vehicles will monitor supply levels, unit locations, and equipment status and be able to transmit this information to logistics leaders. Knowing on-hand supply levels will help logistics leaders to better configure "pulsed" logistics resupplies, typically consisting of 3 to 7 days' worth of supplies. Leaders will use this new, enhanced level of situational awareness, provided by decision support tools such as embedded diagnostics, automated testing, and data analysis, to better support combat forces with fewer logistics assets.

    In an endeavor to revolutionize anticipatory logistics at the wholesale level, the Army is forming a strategic alliance with SAP to integrate and streamline the wholesale logistics process. This alliance will manage demand, supply availability, distribution, financial control, and data management better and provide more flexible and dynamic logistics at the wholesale level to meet specific customer requirements. The benefits will include a synchronized global supply, distribution, and financial network that will increase weapon system readiness and manage mission-based requirements more responsively.

    The Department of Defense also is researching advanced technologies that will bring quantum improvements in joint military logistics, including force deployment, to enhance the readiness of all military forces.

    Industry's SCM and the Army's anticipatory logistics for supporting future combat forces are similar. Whereas anticipatory logistics concentrates on the wholesale and tactical (brigade and below levels), which is a small slice of the supply chain that culminates with the customer, SCM takes a holistic approach to the entire supply chain. Both anticipatory logistics and SCM share various fundamental concepts in order to meet their respective goals and objectives. The future of logistics in the Army is evolving toward a holistic approach, much like business' SCM efforts, to improve its logistics capability while reducing its logistics footprint.  ALOG

    Major Joshua M. Lenzini is an operations research analyst at the Army Training and Doctrine Command Analysis Center at Fort Lee, Virginia. He has a B.S. degree in mechanical engineering from Florida State University and M.S. degrees in operations research and engineering management from the University of Central Florida.