Army Working Capital Fund (AWCF) Investments Process and Opportunities

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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Army Working Capital Fund (AWCF) Investments Process and Opportunities
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Presentation transcript:

Army Working Capital Fund (AWCF) Investments Process and Opportunities 4 March 2015 Josh Kennedy AMCOM Logistics Center U.S. Army Aviation and Missile Command

Modernization [Technology Refreshment] is Continuous… Sustain Field Acquire Dispose Utility PM Example: UH-60L-Digital ITEP MWO’s UH-60L UH-60M UH-60A Numerous ways for Industry Partners (of any size) to “get into the game” APA/OMA – New Models, Major Modifications, Spiral Development… PEOs /PMs Performance Based Logistics (PBL), IRAD, Eng Change Proposals (ECPs) Team Redstone endeavors to maintain a capability and technology overmatch through continuous modernization and technology refreshment. There are multiple paths for industry to “get into the game”: Through PM modernization and sustainment efforts Through PBL contracts, IRAD, and ECPs And through AWCF investments to resolve obsolescence issues, and tackle RAM, cost, and maintenance labor drivers 3) Understanding the needs, priorities, constraints, and programmatic challenges for each weapon system, at each milestone and throughout each lifecycle phase is imperative for effective Government-Industry partnership which create business opportunities We’ll present one method employed by Team Redstone to identify those opportunities for weapon systems in the sustainment lifecycle phase, and highlight key points where industry can gain insight into those needs, priorities, and opportunities – specifically the sustainment analysis process through which we prioritize AWCF investment capital The rest is up to you – our industry partners – to establish, develop, and maintain relationships with key POCs and offices so that your capabilities, your value proposition are aligned to the most critical needs of the Government Industry AMC - AMCOM AWCF Investments in Component Re-Design $60M/yr 2

Public Law Regarding AWCF Investments Authority: 10 U.S. Code § 2208 - Working-capital funds (c) Working-capital funds shall be charged, when appropriate, with the cost of (1) supplies that are procured or otherwise acquired, manufactured, repaired, issued, or used, including the cost of the procurement and qualification of technology-enhanced maintenance capabilities that improve either reliability, maintainability, sustainability, or supportability and have, at a minimum, been demonstrated to be functional in an actual system application or operational environment; and (2) services or work performed; Importance: Ability to Influence Sustainment Costs and Readiness AMCOM has Leveraged AWCF for: - Obsolescence Mitigation - Operating & Support Cost Reduction - Condition-Based Maintenance - Continuous Technology Refreshment - Reliability Improvement Program - Product Improvement Pilot Program We leverage Title 10 authority to use AWCF for a wide array of product and process improvement projects Having this authority and maximizing the effective application of funds gives us the ability to influence sustainment costs and readiness drivers Twice each year, we request project proposals from all aviation and missile project offices These proposals are vetted and prioritized based on a comprehensive review process which requires PM buy-in Semi-Annual Process to Determine Where to Invest

AWCF Data Call Process: Purpose: Solicit and fund project candidates that will provide implementable solutions to mitigate known obsolescence issues, reduce sustainment costs, improve component reliability & usable life, and/or improve readiness. This process strives to vet and prioritize projects based on technical merit and stakeholder priority. AWCF Data Call Process: Entry: Candidate Project Packages – Consolidated List PEO Review / Concurrence PEO/ALC Consolidated List Exit: Final List / Project Packets Approved for Funding AMCOM will Solicit for Solutions to Specific Root Causes Identified in the Sustainment Analysis Process 1) The semi-annual project data call is the culmination of analysis processes to identify issues, down to the root cause, and opportunities with significant return on investment Opportunity for ROI can be measured in terms of cost avoidance, RAM improvements, obsolescence mitigation, decreased maintenance labor burden, improved safety, or any combination thereof Key take-away, which will be highlighted again, is PM sponsorship – a well developed proposal which addresses one or more root causes AND has been fully coordinated with, and supported by, a PM Proposals: Must Focus on Reduced Demands/Cost, or to Mitigate Obsolescence Industry: Can Submit Project Candidates to AMCOM for Consideration for Any Secondary Item

AWCF Project Proposals Each Project Must be Coordinated with Applicable PM Project proposals are submitted in a standard format covering what is proposed and what the proposed project will accomplish (in measurable terms), who will provide the solution (Government, industry, large business and/or small business), when the solution will be implemented – and how Key take-away, again, is PM sponsorship….you may write the best proposal ever written, but without PM sponsorship the likelihood of success is low Primary message: know what the PM see’s as the primary concerns through close coordination with the appropriate POC and craft proposals that are responsive to those needs Well written proposals focused on the most critical need, describing solutions to identified and high priority root causes are vetted through a comprehensive review process… Industry: Can Submit Project Candidates to AMCOM for Consideration for Any Secondary Item

Project Evaluation Flow Chart All project proposals are evaluated thoroughly, scored, and ranked according to technical merit and criticality of the root cause Scored projects are then rank ordered by the affected PM and prioritized by the respective PEO If your proposal addresses issues on systems that are deployed to an operational theater you can bet that PM interest will be higher Once submitted, the project evaluation process takes approximately five months to complete all gates Once AMC approval is obtained, Government leads are notified and contract actions are initiated Twice a year during a 5 month duration April thru August October thru February

How We Are Tackling “Spend” Drivers Numerous ways for Industry Partners (of any size) to “get into the game” OEM PBLs or Efforts Supporting PMs PEOs/PMs Modernization Efforts *Industry Proposals must address: Reduced Demands & Cost Mitigate Obsolescence 3) Lower Lifecycle Cost Burden End-To-End Sustainment Analysis Process I’ve talked about project proposals, when they are submitted, how they are vetted, and the key aspect of having PM sponsorship, now I’ll focus on how we get there: the analysis process that is used to generate project proposals The process begins with the Integrated Priority List and follows a detailed, data-driven exploratory analysis process, to get down to root causes Key take away from this slide is that proposed solutions to root causes should address at least one of the three key areas – best solutions address more than one

Integrated Priority List (IPL) Purpose: The AMCOM Integrated Priority List (IPL) provides a comprehensive list of metrics for all active AMCOM-managed components to facilitate analysis of historical component performance in the areas of maintenance, supply, demand, operational performance and other related areas. IPL Process: Entry: Calendar Trigger – Start Semi- Annual Process on 1 Mar & 1 Sep Query LMP Data, integrate other data sources keyed to NIINs Ranked by Cost Burden Internal & External Validation & Verification Exit: Published IPL The IPL is a key document which lists all AMCOM-managed items, about 18,000 of them, in a rank order according to their per unit cost and annual demands It’s generated twice each year on the 1st of October and the 1st of April and is available to industry through the CASL Legal, contractual, and security constraints limit the amount of data we can include in the public release version of the IPL; however, you can see from the list where AMCOM spends the majority of our AWCF dollars IPL Posted to CASL Information to Industry

Integrated Priority List (IPL) Serves as a Focusing Mechanism for Spending Limited Resources (funding, personnel, time) Priority: Rack-and-stack of All AMCOM-Managed Items by Annual Cost Burden (Price x Demands) Integrated: ‘One-Stop Shop’ of Info on a Given NIIN Across a Wide Variety of Sustainment Metrics LMP/Demand, ASAP/R&M , MCDS/2410, RIMFIRE, & Other Sources as identified IPL Has Evolved, each Semi-Annual Iteration Has New Features: Visibility on B16-AVN (CECOM- managed) Items, Filter by Platform, Costing Data, and more 26.3% FOUO AWCF Cost Burden: AVN/B17 MSL/B64 Total AWCF AMCOM Cost Burden $1.373B $122.6M Top 200 AMCOM Cost Burden $1.134B $102.4M Percentage 82.5% 83.5% As indicated on this slide, roughly 83% of the secondary item cost burden occurs on the top 200 items of the IPL. As such, these items are where we’ll focus the majority of our analysis efforts FOUO FOR OFFICIAL USE ONLY

Component X Purpose: Comp X Process: Component X (Comp-X) performs exhaustive exploratory analysis on a component to identify where additional effort could lead to large payoff reductions in the sustainment cost burden by extending usable life, reducing demands, reducing Maintenance Man-Hours (MMH), and/or improving readiness. These components are collectively referred to as Values of Opportunity (VoO). Comp X Process: Entry: Published IPL & PM Priority List Data Gathering & Analysis Identify the Value of Opportunity (VoO) Exit: Generate Problem Statement for the Final Signed Report Industry: Any Relevant Findings from the Comp X Process will be Provided as Part of the Solicitation

Root Cause Working Group (RCWG) Purpose: For a specific component, the Root Cause Working Group (RCWG) determines associated root cause and recommends possible courses of action (COAs) to address problem statements identified by the Component X (Comp X) process. RCWG Process: Entry: Signed Comp X Final Report Steering Committee Unanimous Approval Decision goes to Industry or Government Prioritize & Identify Root Cause(s) Based on Likelihood Steering Committee Review Exit: Root Cause Determination & Develop Project Proposal Packets for AWCF Investment Industry Opportunity Industry: Any Relevant Findings from the RCWG Process will be Provided as Part of the Solicitation Competitive Solicitation

AWCF Data Call Process: Purpose: Solicit and fund project candidates that will provide implementable solutions to mitigate known obsolescence issues, reduce sustainment costs, improve component reliability & usable life, and/or improve readiness. This process strives to vet and prioritize projects based on technical merit and stakeholder priority. AWCF Data Call Process: Entry: Candidate Project Packages – Consolidated List PEO Review / Concurrence PEO/ALC Consolidated List Exit: Final List / Project Packets Approved for Funding AMCOM will Solicit for Solutions to Specific Root Causes Identified in the Sustainment Analysis Process 1) The semi-annual project data call is the culmination of analysis processes to identify issues, down to the root cause, and opportunities with significant return on investment Opportunity for ROI can be measured in terms of cost avoidance, RAM improvements, obsolescence mitigation, decreased maintenance labor burden, improved safety, or any combination thereof Key take-away, which will be highlighted again, is PM sponsorship – a well developed proposal which addresses one or more root causes AND has been fully coordinated with, and supported by, a PM Proposals: Must Focus on Reduced Demands/Cost, or to Mitigate Obsolescence Industry: Can Submit Project Candidates to AMCOM for Consideration for Any Secondary Item

Project Tracking and Assessments General Officer Quarterly Reviews

Key Take Aways AMCOM has Developed a Consolidated Analysis Playbook Process to Focus its Investments for Systems in Sustainment Lifecycle Phase In Partnership with PEO AVN and PEO MS, AMCOM Invests Approximately $60M/year of AWCF in New Technology and Product or Process Improvements to Lower Ownership Costs and Fight Obsolescence, While Maintaining or Improving Readiness Numerous Ways for Industry (any size) to “Get Into the Game” For AMCOM: Semi-Annual Data Call for Projects Projects that Mitigate/Eliminate Obsolescence Projects that Reduce Demands and/or Price (Cost Burden) Competitive Solicitations for Specific Root Causes via FedBizOpps (as Marketed through CASL) Relevant Findings from Sustainment Analysis Process will be Part of Solicitations Review IPL Provided via CASL

FY15 Projected/Remaining Organic Non-Competitive Competitive ALC Opportunities $M $M Secondary Items Services Repairs $1,184.80 FY15 To Date FY15 Projected/Remaining $1,155.10 Competitive Procurement Goal = 24.5% 11 Awards $513.69M Total 26 Awards $1,592.79M Total Total Services $2,106.48 Procurements $406.10 Engineering/Technical Support Logistics Support Equipment Maintenance Support IT Support Management Support Studies, Analysis, and Evaluations Other/Publications $332.30 Secondary Items: Procurements for FY14 = $519.3M ( FY15 projects a 24% increase, FY16 projects a 8% decrease) Repairs for FY14 = $488.13 (FY15 projects a 23% increase, FY16 projects a 28% increase) Total FY15 Services: Engineering Support Technical Services = 10 Awards / $763.49M / 36.14% Logistics Support Services = 2 Awards / $654.00M / 30.96% Equipment Maintenance Support Services = 7 Awards / $618.53M / 29.28% IT Support Services = 5 Awards / $53.85M / 2.55% Management Support Services = 4 Awards / $13.44M / 0.64% Studies, Analysis and Evaluations = 5 Awards /$3.83M / 0.18% Other Contract Services = 2 Awards / $3.17M / 0.15% Publications Support Services = 1 /$2.00M /0.09% FY14 24,532 Items Managed 1,394 Buys Per Year (30 Sep 14) 420 Competitive Buys AMCOMs Industry Partners (General Electric, Sikorsky, Honeywell & Boeing) Project Competitive/Sub Contracting Opportunities of Approximately 24.5% Information Available in CASL http://amcomdmz.redstone.army.mil/casl_cmo/casl_cmo_home

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