WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 1 DEFENSE LOGISTICS AGENCY AMERICA’S COMBAT LOGISTICS SUPPORT AGENCY DEFENSE LOGISTICS AGENCY AMERICA’S COMBAT LOGISTICS SUPPORT AGENCY WARFIGHTER SUPPORT ENHANCEMENT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT DLA Disposition Services Overview Judy Mahmat DLA Disposition Services Reutilization Business Integration (RBI) Program Office July 12, 2011

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 2 Normal Disposition Flow Usable (50%) Scrap (50%) Primary Mission is to reutilize or safely and securely dispose of excess military equipment and materiel Army Navy Marine Corps Air Force DLA/Other Ultimate Disposal/Abandon & Destroy Army Navy Marine Corps Air Force DLA/Other Federal Agencies State Agencies/ Organizations Public Reutilization Transfer Usable Sales Donation Scrap Sales Public RECEIVERECEIVE HOLDHOLD DISPOSE Screen Verify Items Demilitarize Downgrade AVERAGE TOTAL CYCLE TIME – 49 DAYS DOD & Special Program (SP) screening 14 days Transfer & Donations screening 21 days Sales CONUS DISTRIBUTION TIMELINE Public Consumer Accumulation 7 days Donation allocation 5 days Last chance R/T/D screening 2 days Reutilization/Transfer/Donation cycle 49 days

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 3 1,174 People serving CONUS Fort Lewis Great Falls Minot Stockton Hill AFB Colorado Springs Fort Riley Fort Sill Texarkana Fort Polk Eglin Bragg Cherry Point WPAFB Sparta Mechanicsburg Pendleton DLA Disposit ion Service s Air Force Navy USMC Army Full Service Site Feeder Site San Antonio Norfolk Warner Robins CONUS Locations Aligned With Customers

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 4 Legend Air Force Army Marine Navy Full Service Site Feeder Site 202 People serving CENTCOM Sagami Okinawa Speicher Guam Bupyong Hawaii 173 People serving Europe Molesworth Rota Kaiserslautern Kastel Schweinfurt Germersheim Incirlik Livorno Kuwait Anaconda Al Asad Bagram Victory 161 People serving Asia/Pacific Grafenwoehr Disposition Services OCONUS Aligned With Customers

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 5 5 Administers property disposal service operations: –Receipt of excess and inspection –Categorize by type of property –Establish accountable record –Warehouse and display property for reutilization, transfer, donation, sales, ultimate disposal, abandonment and destruction –Determine final disposition –Monitor partner performance Disposition Services Field Operations

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 6 6  Disposal Turn-in Document, DD A  National Stock Number (valid in FedLog) –Demil Code –Supply Condition Code  Local Stock Number –Part Number –Manufacturers Name –Nomenclature –End Item Application –Explanation why no NSN –Demil Code –Supply Condition Code Receiving

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 7 7 Web Based Method To Prepare Disposal Turn-in Document (DD A) –Designed for generators who manually prepare DTIDS –Reduces time required to complete DTID –Allows review of turn-in before receipt –Electronically captures receipt information –Speeds receiving and improves data accuracy Electronic Turn-in Document (ETID) Barcoded A & Labels Usable or Hazardous Approx. 10% of Receipts

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 8 8 Inspect/Verify/ReceiveCustody Store Accountability CustomerAccumulate Disposition Services Process

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 9 9 Program Characteristics 222K Line Items Received in FY 10 –$6.6 B Acquisition Value –18% of DLA Disposition Services inventory Key Business Rules Electronic Screening, Property Remains at Depot NSN only (No LSNs) Condition Code A-F Hazardous (R/T/D only - not sold in RCP) Demil Required (R/T/D except G and P) Property direct shipped to R/T/S customers Depot designates RCP staging area for donees Recycling Control Point (RCP)

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 10 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 10 Disposal Service Representatives (DSRs) go to the customer: Pre-inspection of generator’s property –Complete, accurate and required documentation On-Site Decisions –Receipt in place (RIP) –Downgrade –Direct shipment to disposition partners Disposal Service Representatives Sierra Hood

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 11 Usable Scrap Primary Mission is to reutilize or safely and securely dispose of excess military equipment and materiel Army Navy Marine Corps Air Force DLA/Other Ultimate Disposal/Abandon & Destroy Army Navy Marine Corps Air Force DLA/Other Reutilization Scrap Sales Public RECEIVERECEIVE HOLDHOLD DISPOSE Screen Verify Items Demilitarize Downgrade Demil/Mutilation Kuwait has Reutilization/Transfer/Donation cycle 42 days Contingency Disposal Overview

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 12 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 12 DAISY is used by DLA Disposition Services (formerly known as Defense Reutilization and Marketing Service) DAISY is comprised of a suite of applications for managing the disposal of military excess property for the following DLA Disposition Services business processes –Property Accounting –Receipt, Store and Issue –Reutilization, Transfer and Donation (RTD) –Sales –Destruction –Ultimate Disposal –Procurement and Compliance Disposal Automated Information System (DAISY)

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 13 RBI Project Overview The RBI project will replace DLA Disposition Services legacy system (DAISY) by incorporating DLA Disposition Services business processes into the existing DLA enterprise suite Enterprise Business System (EBS) - Receipt, Issue, Inventory Management, Sales Contracts, Financials Distribution Standard System (DSS) - Pre-Receipt, Receipt Inventory Management, Ultimate Disposal Base Operating Support System (BOSS) and Destruction RBI Web – Compliance, Reutilization, Transfer, and Donation (RTD), Non-RTD Webs, and Sales Web DLA Transaction Services - Data Translation and Routing DLA Document Services (eDOCS) - Document Management Defense Logistics Management System (DLMS) - Data Exchange Standards, Forms, and Procedures Federal Logistics Information System (FLIS) - Item Identification and Maintenance Each RBI System Partner will be responsible for specific DLA Disposition Services functions:

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 14 RBI Conceptual Design Profiles Rules Item Aging and Status Service Disposition Handling ReceiptStoreIssue Warehousing Services Via MRO Governing Data Administrative Services Procurement Disposition Services Financial Workflow Compliance Identify Property Customer Service

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 15 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 15 DAISY Required Updates –Outmoded architecture (1990) Costly to maintain –Not integrated with DLA EBS, DSS * Hampers recoupment –No ability to research NSN for material * Over 40% of DLA Disposition Services inventory LSN 85% of receipts from outside DLA –Not DLMS, FIAR compliant –No “corporate memory” available at receipt Inadequate info for downgrade decisions –Limited AIT interface –LESO mission requires tracking after issue Why RBI? * GAO interest

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 16 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 16 Containerization –All items in a container covered by a single transaction but visible Reduces handling costs but visible as line item –Should minimize need to batch-lot –Improve visibility for off-site screeners Bar-coding/RFID/IUID On-line NSN searches –Reducing the 40% LSN inventory DLA Disposition Services Business Re-Engineering Opportunities

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 17 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 17 “Reachback” to item history –Available to receiver Downgrade to scrap on receipt for F-G-H items –Shares DLA Disposition Services previous experience with the item across the enterprise Applications –Forbid downgrades on receipt of any item: On any current want list Previously issued (RTDS) within 1 year No item history Item not received in DLA Disposition Services in 1 year Reachback Approach

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 18 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 18 “Standard” LSN’s –Limited by EBS Material Master –Descriptive for common items –Generic for unusual stock classes Condition Codes –Currently use 2-position code DOD alpha followed by GSA numeric (i.e., A1,H7) Some code combinations self-contradictory (A4) Surveys show no difference among numerics within alpha group “Large” cost to reprogram EBS/DSS –DLA Disposition Services to adopt single code Things that may take some getting used to…

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 19 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 19 Accountability requirements will be satisfied in DSS Current interfaces have been identified and will be redirected to DSS Disposal Services Field Office Anniston will be the only site to process Small Arms Disposition Services will continue to maintain the DLA Small Arms Registry Small Arms in RBI

WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 20 WARFIGHTER FOCUSED, GLOBALLY RESPONSIVE SUPPLY CHAIN LEADERSHIP 20 Continue Technical discussions and testing Identify any processes to change RBI integration testing began May 2011 RBI Initial Release is scheduled October 2011 RBI Full Deployment (FD) is scheduled April 2012 Next steps