Performance-Based Logistics Good afternoon. I want to thank Gen. Skibbie and Gen. Landis for the opportunity to chat with you about our ongoing efforts to transform logistics. Performance-Based Logistics 17 June 2003

QDR Direction Project and sustain the force with minimal footprint Implement performance-based logistics to improve readiness for major weapon systems and availability of commodities Reduce cycle times to industry standards Our national logistics performance goals were documented in the Quadrennial Defense Review. They were driven to support operational performance requirements of rapid deployment, precision engagement, and decisive action.

Performance-Based Logistics JACG Oversight via DAB/DAES Oversight via R-TOC Forum DoD 5000 Policy New program implementation 30 Pilot Programs F/A-18 E/F JSTARS Quadrennial Defense Review Second major topic for today was status of PBL Currently preferred sustainment strategy for new systems in 5000.2-R Endorsed by QDR for application to legacy systems 03 DPG included requirement for Service Implementation Schedules to be submitted by March 2002 Reengineer Product Support Performance-Based Logistics Legacy Systems FY03 DPG Service Implementation Schedules Lessons Learned Operational Demonstrations Adjustments A joint, disciplined program to successfully implement PBL! CY02/03 PEO/SYSCOM PM Roundtable AIA Product Support

Performance-Based Logistics Real-Time System Status Industry/Government Buys Performance As a Package (Including Surge/Flexibility) Weapon System Manager Force Provider Partnerships PBA Ensure system is sustained at optimum level per PBA PBA Provide continuous, reliable, affordable support per PBA Acquisition Visibility into cost/risk decisions across life cycle Sustainment Disposal

Delivering Capability PBL Programs in OIF JSTARS B-2 F/A-18 E/F F-117 C-17 Common Ground Station AWACS Delivering Capability

Weapon System Sustainment Roadmap PM accountable for life cycle JROC established sustainment requirements Enabling Depot legislation Revised Maintenance Policy Industry Supply Chains Reengineered Training Number Number of Partnerships (1998 & 2002) Joint Strike Fighter Future Combat System Advanced Amphibious Assault Vehicle Today Suppressed Readiness Marginal reliability Fractionated Accountability $67B/year Huge footprint Warfighter-driven readiness Ultra-reliability Clear PM accountability Minimal Footprint s Financial Reform (PR05) Single-line Accounting Life Cycle Cost Management Operational requirements synchronized with PBBS 2000 2005 2015

Road Ahead On Schedule TLCSM WG JROC Adjustments Workforce Development 5000 Series Updates Revised WSM Logistics Curriculum Workforce Development Service PBL Schedules Program Transition per Service Schedules Enabling Financial Mechanisms On Schedule

Emerging Issues Industry wrap-rates on performance contracts Product Support enabling financial processes Integration of PBL strategies and DLA consumable management Evolution of PM toolkit to support PBL