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Army Material Command,
Logistics Modernization Program
Anthony Zelinski, US Army Logistics Modernization Program
Horace Dick, CSCUS Army Logistics Modernization Program
AgendaAgenda
� LMP Background� Enterprise Vision� Organizational Alignment� Challenges�Working the Solution� Transition
SAPPHIRE / OR3824 Page 2
Why LMP?Why LMP?
� Focus business systems modernization on supporting the warfighter
• Improve business processes • Decrease operational cost and cycle times• Improve the accuracy and timeliness of information
� Remaining on legacy is not a viable option• Cost to support legacy systems are escalating• Legacy systems are rapidly aging
� To reduce redundant and stovepipe IT investments• Commodity Command Standard System (CCSS)• Standard Depot System (SDS)• Bridges and uniques
� Legacy systems cannot meet requirements of:• Federal Financial Improvement Act (FFMIA)• Business Enterprise Architecture (BEA)• Standard Financial Information System (SFIS)• Radio Frequency Identification (RFID) / Unique Identification
(UID)• Net-centricity
Key component of
the Army Logistics IT
vision
SAPPHIRE / OR3824 Page 3
Mission: Support Warfighter Readiness
• Common, accurate, real-time operating view
• Rapid decision making
• Financial integrity• Integrated planning and execution• Precise forecasting
• Focus on core business functions
• Single version of truth
Results: Improved Warfighter ReadinessRight Material, Right Place, Right Quantity, at a Moment’s Not
• Common, accurate, real-time operating view
• Rapid decision making
• Financial integrity• Integrated planning and execution• Precise forecasting
• Focus on core business functions
• Single version of truth
EffectiveConsumable andReparable Orders
Cost-Effective and Efficient IT
Service Reliably PredictMaterial Needs
Continuous Improvement
Single Versionof Truth
Logistics Modernization
Program
LMP Through AMC General’s (CEO) Lens
LMP Through the GeneralLMP Through the General’’s Lenss Lens
SAPPHIRE / OR3824 Page 4
AMC Scope and ComplexityAMC Scope and Complexity
50,000 Vendors 1,000,000CustomersGoods/Services
6,000,000 Items
149 Fixed Locations>1,000 Dynamic Locations
59 CONUS38 Countries
49,000 Civilians1,500 Military
Installation and Direct Support
• OEMs
• DLA
• Services
• Army Depots
• Plants
• Arsenals
• Air Force• Army• DLA
• Marines• Navy• Other Govt.
Unit Support (Warfighters)
Suppliers AMC OperationsInventory and Repair Depot
Customers andEnd Consumers
General Electric• Repairable product supply chain• 100 countries• Cost of goods sold—$38B annually
$40BWal-Mart
• Consumable product supply chain• 1,300 stores in nine countries• 100,000 items
Analogous to a large multinational conglomerate, multiple businesses (Commands), diverse product portfolios, multiple complex supply chains —
with added challenge of customer (Warfighter) readiness for survival
SAPPHIRE / OR3824 Page 5
Acquisition and Distribution
The LMP SolutionThe LMP Solution
� Collaboration• The LMP Team was built from
experts from across CSC, SAP, dozens of external partners and subject matter experts from across AMC
• Full functionality implementation approach
� Unprecedented ERP • Merged Solution
� Core R/3, Public Sector Solution and the Aerospace and Defense Solution
• New Dimensions Products.� Advanced Planner Optimizer
(APO)� Business Warehouse (BW)� Strategic Enterprise Management
(SEM)� Single Version of the Truth, End to
End Integration
• Army Search Matrix and Penetration Logic
• Real-time Global Available-to-Promise
• Back order Processing
• MILSTRIP sales order processing
Industrial Base Operations
• Acquisition• Manufacturing and Remanufacturing
Resource Requirements Planning• National Maintenance Management• Base Operations and Plant Maintenance• Quality Management• Human Resources
• Inventory Management
• Warehouse Management
• Single Stock Fund• Environment,
Health, and Safety
• Distribution Planning• Long Term and Material
Requirements Planning• Project Systems and
Budget Planning• Demand Planning
Logistics Chain Planning
Order Management Buy Distribution
Make
Fix
Budget and Finance• Cost Accounting• Budget Formulation
Product Lifecycle Management• Ammunition Support• Bills of Material
• General Accounting DFAS and Funds Management
• Cost Management and Real Estate (Facilities) Management
• Provisioning• Cataloging
• Packaging and Freight• Maintenance Engineering
Data andReporting
SAPPHIRE / OR3824 Page 6
Financial (FI)• General ledger• Special purpose ledger• Accounts payable• Accounts receivable• Report generator• Fund ManagementMaterials Management (MM)
• Purchasing• Inventory management• Invoice verification• Warehouse managementProduction Planning (PP)• Bill of Materials (BOM)• Work centers and routings• Master production scheduling• Materials requirements planning
(MRP)• Production Orders
Sales and Distribution (SD)• Sales order processing• Pricing• Shipping• Billing• Credit
Project Systems (PS)• WBS Elements• Network Orders
Controlling (CO)• Cost Element Accounting• Cost Center Accounting• Profit Center Accounting• Internal Orders• Profitability Analysis
Workflow (WF)Industry Solution (IS)• Public Services• Aerospace & Defense• Merged Solution
Quality Management (QM)Plant Maintenance (PM/CS)• WS Repair Project Planning• WS Repair & Overhaul Project
Execution
Human Resources (HR)• CATS• Personnel Administration
BI
R/34.6CR/34.6C
FIFICOCO
PSPSWFWF
ISIS
MMMM
HRHR
SDSD
PPPP
QMQMPMPM
AMAM
EP
SCMSEM
Product Lifecycle Management(PLM)• Product Data Management• EH&S
PLMPLM
SAPSAP®® Solution ComponentsSolution Components
Copyright © COMPUTER SCIENCES CORPORATION, 2005-2006.SAPPHIRE / OR3824 Page 7
LMP Enterprise IntegrationLMP Enterprise Integration
Army enterprise integration achieved with the proper solution of architecture, functionality and technology
TECHNOLOGY� Robust scalable architecture, 24x7
reliability.� Thin client technology.� Relational global data structure –
global configuration, with local flexibility.
� Centralized configuration management.
� COTS enterprise application integration.
Technology Advances
USER� Web browser screens.� Single sign-on.� Information readily available.� Real-time information.� Data redundancy standards.� Real-time on-screen reporting. DAASC
INTERIMCCSS
and SDS
DoDSERVICES
•AIR FORCE
•NAVY
•OTHERS
SARSS Gateway
LOGSA
•LIDB
DFAS•ATAAPS
•SOMARDS
•DCPS
AEPS
DCMA
-Reeng
inee
red
DLA
•BSM
•SAMMS
•DSS
•FLIS/CRS
OTHERSOTHERS
•Retail
Finance & Accounting
Inventory Mgmt
Human Resources
Programs & Projects
Planning & Budgeting
Management Information &
Decision Support
Maintenance Mgmt
Supply Chain Mgmt
Customer Mgmt
Facility & Fleet Mgmt
Procurement
AIT
Manufacturing Planning
Warehousing
Property Mgmt
LMP
70+ systems interfacing with LMP
•MOCAS
SAPPHIRE / OR3824 Page 8
SAPSAP®® Customer Competency Center CertificationCustomer Competency Center Certification
�Five Major Support areas assessed against SAP’s worldwide competency center database:
• Global Strategy and Service Level Management
• Support Desk Management• Management of SAP Technology• Support Process Management• Software Change Management
� Initial certification achieved in 2005 and re-certification achieved in 2007
Companies establish SAP Competency Centers as a best practice tosupport their SAP business solutions
Companies establish SAP Competency Centers as a best practice tosupport their SAP business solutions
SAPPHIRE / OR3824 Page 9
Enterprise VisionEnterprise VisionSingle Army Logistics Enterprise (SALE)Single Army Logistics Enterprise (SALE)
“This plan establishes a foundation for leaders and managers to guide them towards a Single Army Logistics Enterprise. We have a huge challenge, but together we can make it a reality. The Army cannot lose focus on the ultimate Logistics Domain IT objective…SUPPORT THE WARFIGHTER.”
- LTG Ann Dunwoody, Strategic Plan for Army Logistics Domain IT Transformation – August 2007
SAPPHIRE / OR3824 Page 10
Providing:• RFID/AIT Capability To Provide Visibility• Providing UID Parts Marking and Readers• Shop Floor Tracking• Enable Technical Data Records Management
Industrial Base Modernization
Providing Capacity & Material Requirements Planning:• Lean Operations• Ability to Re-Plan In Hours vs. Week• Immediate Visibility of Work-In-Progress• Proactive Planning vs. Reactive
Master Production Scheduling
Objective: Robust automation tools to support Army missions and enable the best decision in relation to: Industrial Operations capacity, cost, and schedule management
Part of Army Logistics Modernization Program –Single Army Logistics Enterprise
Phased Approach
Logistics Modernization Program Foundation Providing:
Commodity Commands• Improved Demand and Supply Chain Planning• Financial and Logistic Integration• Common Operating Picture Across Supply Chain• Ability To Share Data With DLA and Industry Base
Industrial Sites• Accurate Financial and Logistical Records• Improved Workloading Forecast• Cost Reduction for materiel used in production
process• Reduced Re-Planning • Improved On-Time Delivery
Enterprise VisionEnterprise Vision
SAPPHIRE / OR3824 Page 11
Organizational Alignment Organizational Alignment Maximizing ERP InvestmentMaximizing ERP Investment
ProjectAuthorization& Release
PLANNING
MasterBOMs/Routes Data
MRPRUNS
PlannedProductionOrdersCreated &Scheduled
WorkCentersData
PlannedPurchaseOrdersCreated &Scheduled
Shop FloorExecution(Work Centers)
Material Rcvd& Staged
Labor &ProductionReporting(Type 8s)
PRE-PRODUCTION
Master Scheduling/ Capacity Planning Process
EXECUTION
ProductionPlanners
MaterialExpediters
ProductionOrderClose-out
ProgramClose-out
CLOSE-OUT
FEED BACK to PLANNING DATA• Army• Other Services
PlannedWorkload
Funded/Unfunded
UnplannedWorkload
Customer ORDERS
DEMAND Thru SUPPLYPlan Make/Repair DeliverMake to stock/order
Source(Order New)
Schedule/ProduceM1.1/M2.1/M3.1M1.3/M2.3/M3.4
Plan to Make P1.1/P2.1/P3.1
Release to Delivery M1.6/M2.6/M3.7
MakeRepair
Plan to Make P1.1/P2.1/P3.1 Plan to
SourceP2.1/P2.2P2.3/P2.4
Plan to SourceP2.1/P2.2P2.3/P2.4
Deliver Make/Stock/EngineerD1/D2/D3/D4
Copyright © COMPUTER SCIENCES CORPORATION, 2007.SAPPHIRE / OR3824 Page 12
ChallengesChallenges
MRP / ERP EvolutionMRP / ERP Evolution
ClosedLoopMRP(70’s)
MRPII(80’s)
MRP(Late 60’s)
ERP(90’s)
Source: ERP Making It Happen, Thomas F. Wallace and Michael H. Kremzar
SAPPHIRE / OR3824 Page 13
ChallengesChallenges
EnthusiastsNaysayers
SilentMajority
Before ERP EducationBefore ERP Education
After ERP EducationAfter ERP Education
Source: ERP Making It Happen, Thomas F. Wallace and Michael H. Kremzar
EnthusiastsNaysayers
SilentMinority
Education was Mandatory, not Elective in Companies that have Achieved Class “A”ERP Certification
Education was Mandatory, not Elective in Companies that have Achieved Class “A”ERP Certification
SAPPHIRE / OR3824 Page 14
ChallengesChallenges
The GoalThe Goal: Achieving World Class Performance (By the Numbers): Achieving World Class Performance (By the Numbers)
Executive Management Planning
OperationsManagement Execution
OperationsManagement Planning
Copyright © COMPUTER SCIENCES CORPORATION, 2005-2007.SAPPHIRE / OR3824 Page 15
Working the SolutionWorking the Solution
Prototype Inputs and OutputsPrototype Inputs and Outputs
Education
Industry Best PracticeKnowledge
Training Baseline
TeamSolutionKnowledge
BusinessGoals&Objectives
NewBusinessOperatingModel
Pilot & FullDeploymentPrototype
Continuous Process Improvement
SDL
Test
EnhanceDesign
Copyright © COMPUTER SCIENCES CORPORATION, 2006.SAPPHIRE / OR3824 Page 16
Working the SolutionWorking the Solution
Moving from the Informal to the Formal System (Valid Moving from the Informal to the Formal System (Valid Schedules) is the key to ERP Business Benefits Realization Schedules) is the key to ERP Business Benefits Realization
Inventory
Inventory Obsolescence
Material Costs
Freight Premium Costs
Cycle Times (Make/Buy)
Overtime Costs
New Business
Workforce Productivity
Readiness / Ao
Business BenefitsBusiness Benefits(Value / Results)(Value / Results)
Inventory
Inventory Obsolescence
Material Costs
Freight Premium Costs
Cycle Times (Make/Buy)
Overtime Costs
New Business
Workforce Productivity
Readiness / Ao
Business BenefitsBusiness Benefits(Value / Results)(Value / Results)
• Reorder Point
• Estimate of Demand
• Excessive Shortages
• “Hot List” Priorities
• Front End Loaded Schedules
• “Funny” Numbers
• Lack of Accountability
• Excessive Mth/Yr End Overtime
• Long Cycle Times
• Unreliable Customer Promises
• Poor Operational Performance
Informal SystemInformal System(Order Launch & Expedite)(Order Launch & Expedite)
• Time-Phased Order Point
• Actual Calculated Demand
• Minimal Shortages
• Order Due Date Priorities
• Level Loaded Schedules
• Reliable / Accurate Numbers
• Single Point Accountability
• Level Loaded Capacity
• Short Cycle Times
• On-Time Shipments
• High Operational Performance
Formal SystemFormal System(Valid Schedules)(Valid Schedules)
Copyright © COMPUTER SCIENCES CORPORATION, 2005-2007.SAPPHIRE / OR3824 Page 17
TransitionTransitionToday vs. TomorrowToday vs. Tomorrow
Longer Cycle Times
Excess Materiel Not The Right Materiel
Idle Resources, Over Used Resources
Expediting as a Way of Life
Excessive Amount of Meeting Time Mostly Execution
Not Planning
Little if Any Management Visibility
Work Started That Will Have to be Put Aside
Reduced Cycle Time
Less Materiel/Excess
Re-planning in Hours Not Weeks
Lower Costs
Resources Load Balanced
Work Executed to Plan
Work Released at Best Time
Job and Asset Status at Fingertips (Readiness)
Parts Shortages Known Early Enough to Address
Problems Planned ForNot Reacted To
LEAN Operations
TOD
AY
TOMORROW(Demand Planning)
(MRP)
(CRP)
(MPS)
SAPPHIRE / OR3824 Page 18
Points of Contact
�Anthony “Tony” Zelinski• [email protected]• 570-954-9913
�Horace Dick• [email protected] • 856-988 4000
SAPPHIRE / OR3824 Page 19
Questions?Questions?
SAPPHIRE / OR3824 Page 20
Thank you!
SAPPHIRE / OR3824 Page 21
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