Performance-Based Logistics Run Deep

 
 
By Kevin Fogarty  |  Posted 2006-05-29 Email Print this article Print
 
 
 
 
 
 
 

In the U.S. military, performance-based logistics means that the Department of Defense buys not only a product or weapons system but also an ongoing maintenance and support contract.

Performance-based logistics, or PBL, is a logistics model that puts in place specific goals and metrics to evaluate success.

In the U.S. military version, it generally means that the Department of Defense buys not only a product or weapons system from a vendor such as Lockheed Martin but also an ongoing maintenance and support contract.
The contractor then becomes the general contractor for sustaining that weapons system throughout the systems lifetime.
The contractor is responsible for moving the system and its components to the correct staging areas and hiring or supplying an integration agent that can connect the shippers, manufacturers, service technicians, trainers and other companies or individuals who contribute to the total support of that weapons system. The benefit to the military is that the arrangement lightens the load on its own logistics capability and makes the system more likely to be available when its needed because the contractor is paid according to how reliable the system is, rather than how much effort or how many parts went into making any necessary repairs or upgrades.
The benefit to the contractor is that it gets not only a product contract but also a revenue stream for the life of the product.

PBL contracts are still awarded to contractors on an ad hoc basis, rather than consistently, throughout the DOD. Check out eWEEK.coms for the latest news and analysis of enterprise supply chains.
 
 
 
 
 
 
 
 
 
 
 

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