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Integrating Defence Logistics

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The logistics support of the future war, would not only require joint Services effort but will require the effort of the entire nation in terms of industrial back up, research and development, material support, infrastructure and manpower. But apparently, no integration is visible at any level…

 The military logistics system ensures that the correct item and service is provided to the end user, at the right time, place, and in correct quantity and quality required for the situation. In the future battlefield scenario, logistics sustenance will become very critical, thereby necessitating introspection and review of the existing capabilities. The likely issues needing immediate attention will be teeth to tail ratios, challenges of logistics in multiple terrain configurations, outsourcing initiatives, automation & modernisation of logistics Services and steps taken at the national level to integrate logistics and create strategic assets. The logistics support of the future war would require the effort of the entire nation in terms of industrial back up, research and development, material support, infrastructure and manpower, and not just a joint Services effort.

The wartime logistics need to be integrated not only at national and services level but also at intra-services level. Presently each service has its own policies, own inventory systems under number of authorities and is headless jointly.

Defence logistics is a complex subject and it deals with expenditure of national resources. Any wasteful expenditure in this area will be at the cost of development and modernisation of the defence forces from the limited budgetary resources.  A very large portion of the defence budget is spent on force maintenance and its readiness for war. Economically the sheer volume and cost of defence related goods make each aspect of logistics a cost centre where a marginal difference result in savings or loss of millions of rupees, even the disposal of scrap runs into millions. A comparative analysis of defence expenditure on maintenance/ personal/procurement shows that India is spending least on operations & maintenance but spending maximum on personal and procurement.

A cross comparison from the above diagram will reveal that Indian Defence Services spends approx 42% of their budget on pay & allowances compared to about 35% by world developed countries and spends about 15% on the operation & maintenance against the average 30%.  Incidentally 45% on Procurement as against 35% by others, which is mainly due to the fact that we have lagged behind in procurement in the past and saddled with vintage inventory.

Present System

The Indian defence services inherited their organisational structures at the time of independence and by and large continued with minor changes. Though, a major restructuring was attempted post Kargil conflict to appoint the Chief of Defence Staff (CDS) to integrate every aspect of logistics but it made no progress and the logistics management of the services is still not integrated.

At the MoD level, the two important entities in the field of logistics are the Defence Minister's Production and Supply Committee and Defence Research and Development Council. The role of the Production and Supply Committee is most important as it covers the entire gamut of planning force levels and equipment planning related to availability of resources. The COSC advises the defence minister on all military matters including logistics matters. The Joint Administrative Planning Committee (JAPC) under the direction of COSC is expected to coordinate the logistics effort of the three Services and is tasked with preparation of a joint administrative plan to supplement and support the overall mobilisation and operation plan evolved by the Joint Planning Committee (JPC), for any future operation or contingency plans involving two or more Services.

The material requirements of all the three Services are somewhat similar with minor variations like missiles, radars, communication systems, ammunition for certain kind of common weapon platforms, vehicles etc. However, all the three Services have separate methods and procedures for procuring materials and supplies, though at a few locations, the air force and the navy do use the services of the army depots for fuel, oil, lubricants and rations. Please refer supply chain diagram.

The present logistics systems of the three Services remain separate and currently using different computer based logistics systems that are mainly based on online materials management. The three Services have individually launched their programme to have computerised inventory management systems.

The Army Computerised Inventory Control Programme (CICP) was sanctioned in July 1994 to install an on-line inventory management system for the army. The first phase of the project was inaugurated in October 2002.

The Navy has its Integrated Logistics Management System (ILMS) which was the first ever automated systemised logistics management system of the armed forces. It was implemented in March 1997. The aim of ILMS is to achieve transparency and strengthen aggregate control, while reducing, if not eliminating, delay causing transaction specific controls. The total users number approximately 1,350 with additional 50 dial up users.

The Air Force has commissioned its Integrated Material Management on Line System (IMMOLS) which is an ERP solution developed by Tata Consultancy Services (TCS). The project started in 1993-94. It took a long and arduous journey of thirteen years to operationalise the IMMOLS. But the Indian Air Force (IAF) is now owner of a truly ERP solution software application. IMMOLS is operationalised at all the self-accounting units across the IAF.

Some of the logistical functions, which are static in nature and may not really affect combat efficiency, have been integrated. The medical services, postal services, MES (Military Engineering Service) works, Embarkation Headquarters, Defence Lands and Cantonment Organisation and the Canteen Stores Department are providing support to all the three Services. The navy and air force are also dependent on the army for common user items such as armaments, ammunition, vehicles, general stores and clothing. These arrangements have resulted in economy of effort and unity of purpose. Yet, there are a number of areas in the present logistics support system, which are open to integration and jointness to achieve synergies in operations.

Drawback

At present, there is no unified command for defence logistics either at national level or at service level and thus there is a considerable amount of divergence in procurement, stocking & maintenance and support functions. There is duplication in certain areas of logistics where common items and weapon systems are in use in more than one Service. The other important weaknesses of present system are:

  • Defence logistics has not been dovetailed into overall national planning.
  • Non-inclusion of public corporations and distribution systems for formulating an integrated national mobilisation plan.
  • The logistics management of the services is not integrated.
  • Services have not evolved a common logistics doctrine and philosophy of logistics support with no or limited interaction and intercommunication on matters of logistics.
  • Delays in decision-making in financial and production planning.
  • Lack of standardisation and codification leads to duplication and high inventories.
  • Multiple stocking echelons lead to a high level of stocking and gets further compounded by the lack of an integrated system approach to determine stock levels.
  • Services have undertaken automation in logistics field separately in spite of commonality of procedures.

Issues and Lessons from West

The uncertain requirements and demands of future conflicts, militaries all over the world are being forced to adapt their supply chains and the life cycle management of their assets. These changes mean that militaries and defence ministries will require greater support from both the manufacturers and suppliers of their equipment and from 3rd Party providers of logistics support. The military logistics systems and organisations of the USA and the UK do hold some lessons and guidelines for India to evolve its own logistics structures and organisations for meeting the challenges of war fighting in the 21st century.

The UK MOD has a common Defence Procurement Agency for all the material requirements of the three Services and the US Department of Defence (DOD) has the DLA for similar tasks, including the mandate for contracting various equipment and materials. Lessons & savings from their logistics system is as under:

India presently does not have a unified body to coordinate defence and civil logistics needs and infrastructure at the national level. The defence logistics should be part of the national economy and both should contribute to each other. Experience of the western world, in adopting an integrated and computerised logistics system has drawn following advantages:-

 

  • Efficient & effective logistics system.
  • Higher customer satisfaction.
  • Prompt response to flexible operational demands
  • Large reduction in stock holdings.
  • 15 per cent savings in inventory costs.
  • Better source contracting leading to further 20 per cent savings.

Way Forward

A common procurement agency would be cost-effective, improve quality control and would streamline stocking levels and inventory control. It would introduce a common procedure for provisioning, stocking and issue that would not only be economical, but would also be beneficial to the consumer and vendors. Another area of commonality could be warehousing of common items of the Services. There is also a case for integrating the logistics needs of the para-military forces especially when a large number of them are employed for border-manning duties and counter-insurgency operations. The aim should be to have a large number of common sub-systems between the three Services with the total life-cycle costs concept of the equipment as against the present concept of acquisition costs only.

Standardisation & Codification are major factor, where inter-Service integration will reduce inventory costs. The inventory of the three Services contains approximately 1.2 million items, out of these; there would be a large number of items and equipment amongst the inventory of the three Services which have identical or similar specifications, but are known by different part numbers and names. This results in excessive stocking, unmanageable inventories and at times unresponsive logistic chain. It would be economical to reduce the variety of similar equipment in the three Services without losing out on combat efficiency.

Today, more accurate means of computer-based simulations and intelligence are available and it is possible to make more efficient logistics plans, and forecast the distribution pattern much before any operation is undertaken. In a computer-based system, the “resource manager” can evaluate and provide various options to the commander. He can also give an objective opinion. For an operational commander, the basic issue is that of responsiveness from its logistics elements.

Another well-established practice increasingly being adopted by all major armed forces is the preferred option of shedding excess logistics baggage to service providers, also known as third party logistics (3PL), especially in non-core areas. This has a twin advantage. Firstly, the armed forces personnel can be more efficiently used for core operational duties, thereby, improving 'teeth-to tail' ratio. Secondly, the armed forces the world over are being put to greater financial scrutiny and public debate over the budgetary allocations. Other aspects need attention is:

  • Evolve a unified/integrated logistics management structure for the three services.
  • Logistics Strategy must harness all available resources at the National level and should account for delivery of logistics infrastructure in the desired theatre with a responsive supply chain.
  • The time taken between forecasting, receipt of the approvals and actual procurement needs to be reduced.
  • The defence forces should move towards nationally reputed firms in the private sector for servicing its central contracts and utilise their expertise in supply chain management best practices.
  • Integrate civil infrastructure and warehousing available in the theatre.
  • Original Equipment Manufacturer (OEM) be involved in forward repairs thereby reducing the need to stock higher inventory levels of spares, reduce requirements of transportation and related infrastructure.
  • The onus of holding stocks to be shifted on to the supplier.
  • Build and stock theaterised logistics grid of supply nodes with state of art warehousing through PPP model.
  • Establish collaboration with all available corporate medical facilities around the theater to achieve a medical supply chain.
  • Provisioning of improved mobility, mechanical handling facilities and universal use of bar-coding system etc in achieving higher efficiency and productivity.

Today there is an increasing acceptance of the concept of defence outsourcing of non-core logistic functions as it frees the commanders to focus on their primary task and saves resources. This is the incentive for synergising existing individual systems into integrated logistics which involves following:

  • At the national level an integrated logistics perspective involving the efforts of the entire nation in terms of industrial back up, research and development, material support, infrastructure and manpower.
  • At the Service HQs level a joint perspective of logistics integrated under one head.
  • The joint logistics framework should function on a systems approach in every aspect such as introduction of new equipment based on life-cycle costs and the “womb to tomb” concept. It would also involve integrating the suppliers with logistics org, linking the distribution system and logistics information networks with various users.

Conclusion

The multiplicity of procurement agencies and other logistics agencies is not conducive in obtaining best "value for money". Pooling of resources is an important step towards joint logistics. Once implemented it would provide the armed forces the capability to achieve the national aim.

We need to learn from the logistics processes of the other countries and introduce a new organisation for unifying and coordinating the logistics efforts of the three Services. At the national level, there is a need to integrate the civil and military logistics infrastructure. There is also considerable scope of privatisation of defence support facilities in order to achieve economy. In times of a futuristic war, the entire country, along with its civilian infrastructure and industries, will have to be mobilized for logistics support, and India is currently not prepared for such a situation.

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