Defining and implementing Performance-Based Logistics in government

Defense AR Journal, Dec, 2004 by David Berkowitz, Jatinder N.D. Gupta, James T. Simpson, Joan B. McWilliams

CONCLUSIONS

We have reviewed the best practices and lessons learned in DoD and Industry for managing and sustaining a complex system in a performance-based environment. Specifically, we identified issues and key criteria for developing strategies and policies to define the required relationships, contractual mechanisms, and incentives to achieve the objectives of PBL in government. Our research efforts resulted in the development of a definition of PBL to be used to guide deployment efforts. We also identified the drivers for PBL and the infrastructure changes needed to successfully use PBL in government. Based on our research findings and those of previous related studies in government and Industry, we proposed six guidelines to successfully implement PBL.

This research also suggests some directions for future efforts needed to successfully implement PBL in government. First, an educational program to clarify the understanding and comprehension of the definition, scope, and purpose of PBL will mitigate some myths and fears about its use. Second, each of the six guidelines requires further research to develop specific policies, procedures, and measures for their use and effectiveness. Third, while the conceptual framework for PBL envisions an organizationwide adoption, in actual practice it is more incremental in nature. Therefore, further research is needed to develop a quantitative method to rank order projects that are candidates for an early adoption of PBL.

Fourth, since the PBL approach emphasizes performance, appropriate performance expectations need to be specified. This requires the development of the performance specifications needed from the customers using the systems being acquired and sustained. Therefore, future research directed toward the development of methodologies and algorithms for creating performance specifications will enhance the implementation and acceptance of PBL approaches in government. Finally, development and implementation of performance-based incentives that include some form of innovation and technology enhancement will be required to realize the full benefits of PBL. While this research has resulted in creating suitable guidelines for implementing PBL, more research is needed to make it a reality.

TABLE 1.
PILOT PROGRAMS FOR PRODUCT SUPPORT STRATEGIES

DoD PILOTS FOR PRODUCT SUPPORT STRATEGIES

Army                    Navy                    Air Force

Abrams M-1 Tank         Advanced Amphibious     Airborne Warning and
                        Assault Vehicle         Control System (AWACS)
                        (AAAV)

Advanced Field          AEGIS Cruiser           * B-1B Lancer
Artillery Tactical
Data System (AFATDA)

* Apache AH-64          * ASE/CASS              * C-17 Globemaster

* Chinook CH-47         Common Ship             * C-5 Galaxy

* Comanche RAH-66       CVN-68                  Cheyenne Mountain
                                                Complex

Crusader                * EA-6B Prowler         F-117 Nighthawk

Guardrail/Common        * H-60 Helicopter       F-16 Falcon
Sensor

* Heavy Expanded        Landing Platform        * Joint Surveillance
Mobility Tactical       Dock-17 (LPD-17)        Target Attack Radar
Trucks (HEMTT)                                  System (J-STARS)

* High Mobility         Medium Tactical         * KC-135 Stratotanker
Artillery Rocket        Vehicle Replacement
System (HIMARS)         (MTVR)

TOW/ITAS                * Standoff Land         Space-Based Infrared
                        Attack Missile-         Systems (SBIRS)
                        Expanded Response
                        (SLAM-ER)

ASE/CASS =Aviation Support Equipment Consolidated Automated Support
System

TOW/ITAS = Tube-launched, Optically-tracked, Wire-guided Improved
Target Acquisition System

* Highlighted programs were included in our Performance-Based Logistics
research through interviews or presentations.