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Maritime Logistics Community News : April 2014
28 MARITIME LOGISTICS COMMUNITY NEWSLETTER 2014 DMLO HMAS TOBRUK LEUT ALEXANDER COLRAIN, RAN Supply Chain Management Effective collaboration within Supply Chain Management (SCM) both up and down the chain, is a vital component that ensures not only customer satisfaction, yet allows supplier and delivery innovation. Abstract Opportunities for collaborative innovation at each stage along the Supply Chain (SC), provides beneficial strategies, initiatives, process improvement and training opportunities that ensures that each step along the SC process is afforded the most basic principle in SCM; The right product, to the right customer, at the right time, at the right place, in the right condition, in the right quantities, at the right cost. Introduction The Supply Chain that I will be analysing for this exam is the Australian Defence Force (ADF) Joint Logistics system. In order to provide effective analysis, it must first be described how materiel enters the supply chain, and then effectively managed, warehoused and distributed. The Defence Materiel Organisation (DMO) is the ADF's purchasing branch, responsible for the acquisition of all new capabilities and the ongoing sustainability of already in-service equipment and materiel. This is further subdivided into System Program Office's (SPO), who manage on behalf of Defence, the sustainability and maintenance of all primary capabilities such as Aircraft, Ships and Vehicles, and Inventory Purchasing Office's (IPO) who are vested with the purchase of specific and generic materiel to be kept on the shelf for immediate use. Once DMO or an IPO have purchased the items, all materiel is then entered into the Defence Supply Chain (DSC), controlled by Joint Logistics Command (JLC), with a unique nine digit NATO Stock Number (NSN) for ease of identification through the Military Inventory Logistics Information System (MILIS). Figure 1 right outlines the DSC owned and controlled by JLC. The DSC is split up into three main categories of support. First line, Second line and Third line. First line is categorised as those individual units using the equipment with a requirement for materiel support -- the end user or customer. Second line support are individual districts, supported by Joint Logistic Units (JLU), of which provide enhanced warehoused logistic materiel access and supportability with regards to the DSC for units within that district. There are five JLU districts strategically spread throughout Australia that support all the branches of the ADF being, Navy, Army and Air force. These are positioned in South Queensland (JLU-SQ); North Queensland (JLU- NQ); Darwin (JLU-North); Western Australia (JLU-W); and Victoria (JLU-V). These are all in turn supplied and supported by the primary third line logistic facility, being the Defence National Storage and Distribution Centre (DNSDC) at Moorebank, Sydney. Transport and distribution between all nodes is via the Defence Inventory Distribution System (DIDS), where JLC have a standing offer with TOLL Logistics. The Collaboration The process for demanding materiel and stores support within the ADF while on paper appears relatively straightforward can become quite involved. Theoretically, a typical demand will work as follows: In reality however; it is often encountered that the JLU does not have the item(s) in stock on hand, and therefore the respective JLU must then requisition through other JLU's, or DNSDC, for the issue of those particular items as shown in Figure 2. If they are available from another JLU or DNSDC, an inter district transfer (IDT) is conducted to the requesting JLU, then issued to the first line customer. If the item(s) are not available at either another JLU or DNSDC, the item(s) are then considered Nil Stock Global. This status is the enabler in order for DMO, through either a SPO or IPO, to commence the acquisition processes required to purchase the item(s), and also purchase additional items so that the Nil Stock Global status does not occur in the future. The number of items to be purchased is determined by the Logistics Data Allowance (LDA) branch of DMO that computes historical usage rates into an expected future usage rate for all materiel. Once the acquisition process is complete, the item(s) are brought onto charge in MILIS at DNSDC; an IDT is conducted electronically on MILIS, and then distributed through DIDS to the requesting JLU and issued to the first line customer. Analysis As described above, it appears that a great deal of collaboration occurs at all levels to ensure that the first line customer is afforded the right product, at the right time, at the right place, in the right condition and in the right quantities. Whilst a great deal of effort is placed into ensuring materiel is delivered, JLC and DMO both being branches of Defence, are in fact two Figure 1 -- Due to no JLU being located in the NSW region, DNSDC is the primary warehouse for NSW units to demand materiel from. Continued next page ...