By Beth Reece
The Defense Logistics Agency is building a masterplan for meeting new challenges posed by the shifting global logistics environment through its new Acquisition Modernization Program.
The strategy is expected to formalize how the agency strengthens acquisition employees’ skills, improves processes and applies market intelligence, all while taking advantage of DLA’s ongoing efforts to modernize its information technology tools.
Challenges DLA encountered in its support to warfighters and other federal agencies, especially during the pandemic, have highlighted the need for deeper understanding of the dynamic environments in which the agency now operates, DLA Acquisition Director Matthew Beebe said.
“We have to continually evolve with new developments in acquisition and work to address emerging risks, and the best way to do that is to have an enterprise-wide plan that guides us toward our common goals,” he said.
DLA has worked to improve acquisition capabilities through various initiatives over the years, but AMP is a long-term plan that will synchronize existing efforts and help influence budgets, added Luis Villarreal, DLA’s industrial capability and Warstopper program manager.
An agency-wide advisory group called the Acquisition Enterprise Innovation Council is being created to provide vision and direction in eight focus areas that range from strengthening employee knowledge and giving them better tools to automating processes.
“So often our processes are affected by technology. If we can use things like artificial intelligence and machine learning to make people’s jobs easier and to achieve the outcomes we want, then that’s progress,” Villarreal said.
Market intelligence is another key component of AMP. Although contracting officers already conduct market research by gathering data on business and industry trends as well as suppliers’ capabilities, market intelligence provides deeper knowledge of industry operations and risks.
“Where is the supplier getting their materials from? Do their financial ratios indicate a high degree of risk? Do they do large-batch runs or small-batch runs? What makes them tick? This kind of data gives us a much more robust understanding of industry than what we gain through market research,” Villarreal said.
Adopting market intelligence at DLA will help drive decision making and reduce risk, but getting there means establishing valid data sources and creating standard processes for supply chain analysis. The intent, Villarreal added, is to create a market intelligence capability at DLA that equips acquisition employees with a product that helps them understand how to best form acquisition strategies in particular commodities.
“So what are those work products that the market intel cells are going to deliver? AMP will help us figure that out,” he said, adding that each supply chain at DLA’s major subordinate commands is at a different stage of maturity in market intelligence.
A better knowledge of industry strengths and weaknesses will also help DLA assess current and future contracting strategies, said Air Force Col. Scott Ekstrom, AMP program manager.
“We’re not going acquire capability in 10 years the same way we’re doing it today,” he said. “Look at the amount of digital transformation that’s going on where industry is using computer models instead of two-dimensional drawings, for example. How do we modernize our approach to technical data in government acquisitions to keep up with developments in industry?”
AMP also includes redefining quality in DLA contracts. The agency already has processes for measuring how well agency contracts conform to laws and regulations and even whether the contract is a smart buy in terms of dollars and customer requirements. What it doesn’t measure is the rate of errors that make contracts nonexecutable, Villarreal said.
“We also need a way of tracking metrics that give us a more wholistic picture of what defines quality, particularly from customers’ points of view,” he continued.
All DLA acquisition employees will be part of AMP, Beebe added.
“Whether they are training for a new skill or interacting with new software that’s giving them more insight into elements like risk, we want them to know they’re actively taking part in AMP,” he said. “Defense market competition is dramatically more complex and data-driven than ever, and AMP is how we’ll continue to strengthen our advantages as a team.”
AMP compliments the Defense Department’s Adaptive Acquisition Framework, which is intended to shift defense acquisition from a one-size-fits-all structure to a flexible system that promotes critical thinking, tailored strategies and risk management. It is also a key part of the DLA Strategic Plan, for which the fourth line of effort is “Modernize Acquisition and Supply Chain Management.”