DoD Supply Chain Integration Performance Metrics using RFID April 8, 2008.
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Transcript of DoD Supply Chain Integration Performance Metrics using RFID April 8, 2008.
DoD Supply Chain Integration
Performance Metrics using RFID
April 8, 2008
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Objective
Demonstrate how passive RFID…
- Captures precise measurement of materiel flow
- Identifies potential opportunities for improvement
• Improved business processes (Lean Six Sigma approach)
• Timely system updates
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Travis AFB, CA
Elmendorf AFB, AK
Fort Richardson, AK
Commercial Ship
Commercial Truck
Military Aircraft
DDJC
Objectives of Alaska Project
Determine how to automate processes with passive RFID technology & execute RFID enabled processes
Determine how to make ITV data available through DoD enterprise capabilities (e.g. DAAS, IDE, AV)
Identify business process re-engineering opportunities
Quantify the financial benefits
Using RFID to highlight opportunities for improvement
The Alaska RFID Project
Cross-Service implementation of passive RFID technology along multiple supply chain segments at select Department of Defense
(DoD) sites (DDJC, Travis, Alaska)
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RFID provides a new data point - revealing actual materiel movement more discretely for the first time
Continuous Process Improvement (CPI)
Root cause analysis
Issue Identification
Accurate measurement
RFID Middle-
ware
Actual Movement of Materiel
System Transaction
We need to understand this gap
Identify issues with the process between these two points
Logistics System
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RFID Middle-
ware
Distribution Depot
RFID Middle-
ware
RFID Middle-
ware
Retail Logistics
System
Retail Facility
Logistics System
Logistics System
The new RFID data point provides additional insight within the response time segments
Storage Depot Time Transportation / Theater Time
ArrivalReceipt
TransactionDeparture
Shipment Transaction
DepartureShipment
Transaction
Trans-shipment Point
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RFID reveals potential areas for improvement at the Container Consolidation Point
RFID Middle-
ware
Logistics System
Materiel loaded onto the truck trailer
System transaction indicating truck departure
Transportation Time
The average time to build a container load at the CCP was over 3 days
In-transit to the Customer
Average = 3.33 days
The average time to build a container was variable
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RFID reveals potential areas for improvement at the retail sites
RFID Middle-
ware
Retail Logistics
System
Actual Arrival of Materiel (Visibility Transaction)
System Receipt Transaction
The new data makes this process visible for analysis.
Transportation Time
Site A had an average receipt posting of 0.3 days. Site B had an average receipt posting of 8.5 days.
Opportunity: Reduce receipt take-up time
Business Benefits: Materiel to the customer more quickly, Increased throughput
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RFID reveals potential areas for improvement at retail sites when there is no system receipt at DAASC
RFID Middle-
ware
Actual Movement of Materiel
No System Transaction in DAASC
Identify issues with the process
X
Many requisitions to the Alaska sites did not have a system receipt at DAASC*:
• 19% of the requisitions going to Ft. Richardson• 26% of the requisitions going to Elmendorf AFB
*Requires additional causative research: - Receipted in local AIS but not sent to enterprise level? - Not receipted in local AIS or at enterprise level?
Sep-Nov 2007 requisitions reviewed in Jan 08. Metrics are based on a statistical sample - 95% confidence with a variation of ±6.5%.
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No ITV5%
Passive RFID44%
Active RFID24%
FedEx27%
Sep-Nov 2007 requisitions reviewed in Jan 08. Metrics are based on a statistical sample - 95% confidence with a variation of ±6.5%.
No ITV3%
Passive RFID74%
Active RFID13%
FedEx10%
Type of visibility at Ft Richardson
95 – 97% of requisitions were visible at the local site via RFID or FEDEX, despite not having a system receipt at DAASC
Type of visibility at Elmendorf AFB
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Closing receipts in a timely manner produces business benefits
RFID Middle-
ware
Actual Arrival of Materiel (Visibility Transaction)
Transportation Time
Including requisitions not received, the response time measurement grows from an average of 8.5 days to 28.9 days.
Time of the Analysis (No receipt in Systems yet)
Retail Facility
Opportunity: Reduce LRT by eliminating erroneous supply receipt discrepancies
Business Benefits: Reduce erroneous losses, Avoid possible reorders
System Receipt Transactions averaged 8.5 days
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22% of requisitions from DDJC to Alaska sites were never received at DAASC.
• After the expected arrival date, 30.1% of those requisitions had a subsequent requisition by the same unit ordering the same or greater quantity of the same NSN
• The POSSIBLE reorders represent 7% of the entire number of requisitions sent to Alaska in same timeframe (June – Sep 2007)- Transportation Savings- Inventory Reduction
Alaska Customers
DDJCOriginal Request:
Requisition A
NSN # 123
Reordered Request:
Requisition B
NSN #123
Materiel that Arrived
Reorder
Not Received
Analysis June 2007 – September 2007 Metrics are based on a statistical sample - 95% confidence with a variation of ±6.5%.
Estimating a potential business benefit – avoiding reorders
* Requires additional analysis of demand data to confirm if reorders occurred
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RFID reveals precise materiel movement, enabling Lean Six Sigma process analysis
TDD Target
* RFID LRT Mean = 32 days STDev = 17.5 days
*System LRT Mean = 43.5 days STDev = 24 days
68% of Issue Priority Group 3 requisitions actually arrive within the defined Time Definite Delivery (TDD) target of 37 days compared to 56% of system receipts.
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Trans-shipment PointDistribution Depot Retail Facility
Storage Depot Time Transportation / Theater Time
ArrivalReceipt
TransactionDeparture
Shipment Transaction
DepartureShipment
Transaction
Potential improvements will have a cumulative effect across the DoD Supply Chain
1 day improvement* 2 day improvement* 8 day improvement*
11 day improvement*
*days improvement are examples only
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Summary
Passive RFID provides a new data point
- Captures precise measurement of materiel flow
- Identifies potential opportunities for improvement
• Improved business processes (Lean Six Sigma approach)
• Timely system updates
Initial implementations at small sites yield an opportunity for improvement
Analysis team will continue to work with the Services to enable them to complete, and expand upon, the analysis