1. Contract Administration
DLA Aviation
Supplier Operations
Contract Administration
Rob Baker
Industry Day
May 2017

2. Aviation Leadership/Org Structure
Commander: Brig Gen Allan Day (USAF)
Deputy Commander: Mr. Charlie Lilli (SES)
Acquisition Executive/HCA: Ms. Cathy Contreras (SES)
Director, Supplier Operations: CAPT Bob Keating
Deputy Director, Supplier Operations: Floyd Moore
Contract Administration, Division Chief: Rob Baker
Deputy Division Chief: Janice Hicks
3 Branch Chiefs – GS-13’s – 45 administrators per Branch
12-Section Supervisors – GS-12’s

3. Aviation OEM - Administration
OEM, Division Chief: Shirley Quaye
2 BRANCHES/4 SECTIONS WITHIN THE DIVISION
40 Contract Administrators
OEM Divisions - Original Equipment Manufacturer
Directly supports our 18 Aviation Strategic Supplier Alliance (SSA) Partners:
Boeing
Bell
Sikorsky
GE, etc.
Aligned with OEM Pre-Award ISTs
Aligned with Supplier Relationship Managers (SRMs)
Participate/Support Joint Steering Groups
Participate/Support Executive Committee Meetings

4. Aviation Scope Of Operations
Obligate $8-$9M Purchase Orders/Contracts daily
Averaging 120,000 open contract lines per month
121,646 – April valued at over $3.6B
3,471 different suppliers worldwide
16K contract administration actions per month
10K modifications per month
4K expedites per month
2K (QNs/ZTs/CPARS/CDRs/OPs) per month
Airframes, Engines, Aviation Commodities (Bearings, Cables, etc.)
Work assigned by alpha (A-AC)/CAGE code based on volume
Average Lines Per Administrator: 800 lines (down 40% from 2014)
Average Suppliers Per Administrator: 30 suppliers
Aviation Scope Of Operations
Note: Although not all lines have actions and flow through the system, there are many that are touched even if only an expedite request

5. DLA Aviation Active Delinquencies/OTD Oldest Delinquent POs (>CDD)
AD Goal: No POs Lines > 90 Days Past CDD, Actual 9030
OTD Goal: 90%, Actual 90.80%
Open PO Lines – 112,331
PO Lines > CDD – 19,271, 17.2%
Oldest Delinquent POs (>CDD)
Quality Inspection (3SEY5) 3181 days > CDD
Richardson Electronics (5L804) 2280 days > CDD
GE Aviation (35351) 2158 days > CDD
Tarrant Assoc (1V478) 1941 days > CDD
Wyvern Tech (0C8D3) 1781 days > CDD
Delinquent PO Lines >90 Days Past CDD
Rolls Royce (K0378) 109 lines > 90 days, 25%
Federal Prisons (90142) 123 lines > 90 days, 25%
Sikorsky (78286) 658 lines > 90 days, 14%
Hamilton Sundstrand (73030) 381 lines > 90 days, 11%
Boeing (0PXV4) 468 lines > 90 days, 10%

6. DLA Aviation – OTD Goals
Improving Internal Processes – Back to Basics
PARs/QNs/FATs/PLTs/CDRs
CPARs/OPs/ULOs/Contract Close-outs
Consideration/Withdrawals
Trade-Offs:
Ensure we modify contracts (if we make a deal)
Improved Internal/External Relationships
Pre-Award/Quality/Material Planners
DCMA
Get it right the first time!

7. DLA Aviation – OTD Goals
Bi-weekly open order report to Suppliers
Collaborating with DCMA
Analyze volume/adjust – “Readiness Focus”
Pro-Active Calls/Communication
Dedicated Teams – 60 Days/FAT Team
Adding Critical Milestones in Contracts
Post Award checks performance/mitigates delays early vs days before delivery
Incentives/Disincentives to drive OTD
GE Joint Opportunity Contract (JOC)
OTD above 90% last 2 quarters
1% disincentive charged for missing OTD goal

8. Aviation Standards/Expectations
Quality Notifications (Non-conformance issues)
Once assigned, QNs - 50 days
31% Reduction – March 2017
ZTs (FAT/PLT/Textile testing, etc.)
Once assigned, ZTs - 15 days
Special Projects/High Viz – 5 days
29% Reduction – March 2017
Contract Deficiency Reports
resolved within 30 days
Sent to administrators weekly
88% Reduction in Aged CDRs – March 2017
Modifications – 5 days

9. Aviation Test Tracker – FATesT (First Article Test)
FATesT tracks every open testing CLIN from creation until closure in EBS (DLA system)
CLINs added from DPR report twice a month
Status updated upon changes
Manual - Delivery at lab, receipt of test report, creation of QN
Automatic – Creation, CDD changes, QN closure, CLIN closure
**DLA can now systemically get status of FATs**

10. Aviation Supply Chain 17% reduction 33% reduction Late at Lab
Late at MFG
Aviation Supply Chain
FAT Gated Flow Process
March 6, 2017
8,216 Open Test CLINs
Gate 1
MFG
Gate 2
Lab
Gate 3
QN Created/FAPM
Gate 4
PS/PAA Review
Gate 5
Vendor Notified
2615
1914
194
129
701
689
434
305
399
5488
On Time = CLIN CDD
Not Breached
Late =
CLIN CDD
Breached
5 Calendar /
3 working days
25 Calendar /
18 working days
Process Complete
LAB: Elevation process begins 30 days beyond CLIN Contract Delivery Schedule (derived from prior lab performance)
Continue elevation every 30 days thereafter
LAB Performance
> than 60 Days Late - 15
> than 90 Days Late - 41
> than 180 Days Late – 29

11. Aviation Testing Status Testing Labs/Platforms by Volume
Facility
ESA
NIINs
CLINs
Late
AWP/G
UFOs
IPG1
Tinker ALC
155
157 39
299
294
221
Warner Robins ALC
F-15 65 70 24 17
112 43
C-5 61 63 28 21 48 30
C-130 55 58 25
118 23 12 9 7 16 10
Hill ALC 8 77
Wright Patterson Materials Lab 35 38 33
501 54
USA 31 36 6 96 90
USN 20 27
109
80% Reduction in Lateness – WR-ALC C-130
57% Reduction in Lateness – WR-ALC C-5
11% Reduction in Lateness – WR-ALC F-15

12. Aviation Testing Status
Top 10 Delinquent Contractors by Late CLINs at Manufacturer
Vendor
Late
Tot CLINs
Pct Late
AWP/G
UFOs
IPG1
CASCADE AVIATION SERVICES INC DBA 48
142
34%
105
143
106
DANKO ARLINGTON, INC DBA 36 66
55% 33 28 20
D-J ENGINEERING, INC. DBA 69
48% 35 50 31
HONEYCOMB COMPANY OF AMERICA, INC. 30 67
45% 44 57 43
S & S PRECISION MANUFACTURING, 42
67% 27
123 52
PRECI-MANUFACTURING, INCORPORATED 63
43% 25
112
LOC INDUSTRIES, INC. DBA 26 56
46%
181 45
TECHNIC SPHERE DBA
74% 53
G. S. E. DYNAMICS, INC. DBA 23
101
23% 8
154
SONFARREL INC. DBA 22
63%
129 29
15+ Top Ten Aviation FAT Suppliers cleared from list in 2016
41% Reduction in Top 10 Late CLINS per supplier
From 56.8 average late CLINS to 33.8 average late CLINS

13. DLA Aviation/DCMA Strategic Engagements
Aviation Site-Visits to DCMA CMOs/Commands:
DCMA Dallas – 2015 (most mature relationship)
DCMA Baltimore
DCMA Hartford -2016
DCMA Detroit
DCMA Los Angeles – 2016
DCMA Central Command/Aviation Summit-March 2017
DCMA Tampa – April 2017

14. DLA Aviation/DCMA Lessons Learned/Way Forward
Increase DLA collaboration w/DCMA on business decisions
Ensure DCMA is represented on all DLA supplier engagements
Establish Single DLA/DCMA “battle rhythm”:
One Open order report
One Government Team
DLA HQ Post Award Summit Action Item
Expand Engagements to all DLA Buying Commands
Maturing the DLA Aviation/DCMA relationship
Industrial Specialist + QAR + Contract Administrator = SUCCESS
Aligning DLA resources to DCMA CMOs
For those DCMA Top 500 or DLA Aviation high volume suppliers

15. How Can You Help DLA Contract Accuracy Accurate Proposals
Communication Between Parties
Accurate Proposals
Bidding Within Supplier Capacity
Effective Management of Subcontractors and Suppliers

16. Final Thoughts DLA can’t do anything without our Industry Partners
DLA has to better understand Industry
Both capabilities and limitations
Proactive conversations vs. reactive
Goal to increase DLA/Industry engagements to collaborate our resources/efforts to minimize duplication and deliver on time for the warfighter!

17. Questions Rob Baker, Division Chief, robert.baker@dla.mil
Janice Hicks, Deputy Division Chief,

18. Back-up Slides

19. Types of Modifications
Bilateral
FAR (a)
Supplemental Agreements
Used when parties agree
Unilateral
FAR (b)
Used when the government exerts its rights to change the contract without consultation or agreement with the contractor

20. Bilateral Modifications
Contract modification that is signed by the contractor and the contracting officer. Bilateral modifications are used for the following:
Make negotiated equitable adjustments resulting from the issuance of a change order;
Definitize letter contracts; and
Reflect other agreements of the parties modifying the terms of contracts

21. Unilateral Modifications
Contract modification that is signed only by the contracting officer. Unilateral modifications are used for the following:
Make administrative changes;
Issue change orders;
Make changes authorized by clauses other than a changes clause (e.g., Property clause, Options clause, Suspension of Work clause, etc.); and
Issue termination notices.

22. Recurring Root Causes For Modifications and Delinquencies
First Article Testing / FAT Data Reports
Unrealistic Contract Delivery Date (CDD) and Production Lead Time (PLT)
Bids Without Exception
Technical Data Deficiencies
Tooling
Supply Chain Management (Prime to Sub)
Material Availability
Poor Production Planning

23. Root Causes (Continued)
Overextended Contractors
Bid Despite Capacity
Parts for Aging Fleets Past Expected Life-Cycle
Rare or Difficult to Manufacture
Administrative Changes and/or Corrections
Buyer Error
Posting and Invoicing Issues