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Maritime Logistics Community News : Winter 2011
36 NAVY SUPPLY NEWSLETTER WINTER 2011 This is a joint Navy/DMO project introduced under the Strategic Reform Program (SRP) and New Generation Navy (NGN). MCM allows ships to easily see the cost of stores ordered by the ship and consumed by departments within the ship. Ships will now be far more cost-conscious in their management of Naval Stores. MCM is not intended to make Navy "do more with less"; instead, it gives Navy an excellent tool to know what drives costs so that we can collectively use our resources more efficiently and thus gain an improved capability outcome from Navy's finite stores sustainment funding. Background Historically, there has been no effective way to manage the consumption of stores by ships. Ships could consume and re-order stores to allowances with limited available information or incentive to make cost-conscious decisions. Stores procurement agencies such as Navy Inventory Procurement Organisation (NIPO) were conscious of the costs involved, but were limited in their ability to influence ships' consumption decisions. These agencies were obliged to replenish and repair stores consumed and inevitably finite resources meant that some required items became unavailable. Overall, this situation generated sub-optimal stores management, waste and ultimately reduced capability. Consumption Management has been tried in the past but has not endured. MCM has incorporated some of the lessons of those experiences, including the requirement to minimise administrative overhead and any other non- value adding processes. Consequently, MCM data collection and report Materiel Consumption Management Fleet Command has introduced Material Consumption Management (MCM) effective from 01 April 2011. LCDR T.C. BINNS RANR AND CMDR B.S. YORK RAN