Public-Private Partnership D S C R... T H E B E S T I N W E A P O N S Y S T E M S S U P P O R T Virtual Prime Vendor 54H60 Propeller for C-130, P3, E2 Aircraft

Agenda  Background DLA’a PV/VPV Concept Development/Expansion VPV Proof of Concept  Challenges Contract Award Implementation Issues Cultural Obstacles  Migration of the Concept Current Contract Status/Performance  Conclusion VPV Lessons Learned Mainstreaming Public/Private Partnerships in DLA

Background  DLA’s PV/VPV Concept Development/Expansion Doing More with Less Acquisition Reforms Prime Vendors for Pharmaceuticals, Subsistence, Medical/Surgical Supplies, other Commercial Consumables Virtual Prime Vendors for Weapon Systems  VPV Proof of Concept Developing the Concept Identifying the Best Customer, Supplier, and Weapon System to prove the concept Broad Agency Announcement Industry Conference

Challenges  Contract Award Justification & Approval (J&A) for Sole Source Award Contract Length (1 year w/4 one year options new concept) Performance Metrics Pricing Methodologies Consensus/Agreement among Stakeholders  Implementation Issues Systemic Problems Stock Redistribution Ongoing Pricing Issues Metric Measurement

Challenges  Cultural Obstacles DLA ICPs/Depots Military Customers OEM Suppliers GAO/IG

Migration of the Concept  Migration of the Concept Public- Private Partnerships in DLA OEM Supplier Teams Corporate Contracts Strategic Supplier Alliances On-Site Contractor Support Roundtables – 1 on 1 with Suppliers

Current Contract Status/Performance  Metrics Better Aimed at Measuring Contractor Performance  Contractor Performance Time (CPT) - # of days from date delivery order is issued to date total quantity is shipped CPT Metric Routine Orders – 90% Shipped within 8 days Most recent 6 months – 99.4% CPT Metric Expedited Orders – 90% Shipped within 2 days Most recent 6 months – 97.8%  Time on Backorder (TOB) Backordered delivery orders delivered and Backordered delivery orders still outstanding at the end of the performance period – Must average between day Most recent 6 months – Average TOB 20.5 days

Current Contract Status/Performance  Contract Incentive Plan Vendor may earn additional service fees for exceeding CPT & TOB performance metrics Vendor may earn negative points for performance below the minimum requirements for CPT & TOB

 VPV Lessons Learned Stakeholder Buy-In and Shared Risks Business Case Analysis Surge  Mainstreaming Public/Private Partnerships in DLA  Controlling the A-76 Fear  Legacy Systems/Business Systems Modernization Conclusion