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When I assumed my office in November, 1997, I established Logistics Transformation as a top priority to improve service to our warfighters and to reduce costs. Doing so, I predicted, would free up resources to increase modernization. I initiated this bold effort, with its apparent dichotomy (improved service at reduced costs), based on the experience of worldclass commercial logistics providers. These providers have demonstrated dramatic improvements in customer service (responsiveness, on-time deliveries and dependability) and a 40 percent reduction in cost. Our challenge has been to assess and adopt these commercial practices to the unique military requirements of DoD logistics.
Through the heroic efforts of the Military Departments, the Defense Logistics Agency (DLA) and the U.S. Transportation Command (TRANSCOM), we have achieved dramatic improvements in our logistics operations over the past three years. Average logistics response time has been slashed by 50 percent (from 36 days to 18 days). Secondary item inventory was reduced from $67 billion to $55 billion. We also increased in-storage asset visibility from 50 percent to over 94 percent. The fact that these dramatic improvements were realized while continuing to support the high operational...
