defence logistics transformation program (dltp) industry briefing 20 feb.pdf · joint logistics...

JOINT LOGISTICS COMMAND

Defence Logistics Transformation Program (DLTP)

Brief to Industry

20 February 2012


This Industry Briefing is being conducted to provide background information only in relation to the Defence Logistics Transformation Program. It does not form part of the proposed Program procurement processes.

The information provided at this Industry Briefing is indicative only and is subject to change.

Defence accepts no responsibility or liability for any representations or information provided at this Industry Briefing.

JOINT LOGISTICS COMMANDDefence Logistics Reform: Logistics to train, fight and win

Commercial-in-Confidence


Presentation Contents

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Topic Presenter

Opening Address Air Vice Marshal Margaret StaibCommander Joint Logistics

DLTP Overview Mr. Dave McGaheyProgram DirectorDefence Logistics Transformation Program

Logistic Services Scope Mr. Dave McGahey

W & D Scope Mr. Dave McGahey

LMM Scope Mr. Dave McGahey

Service Delivery Interface Considerations Mr. Dave McGahey

International Traffic in Arms Regulations Considerations Mr. Dave McGahey

Information and Communication Technology Mr. Dave McGahey

Collaborative Innovation Colonel Andy MacleanDirector RetenderingDefence Logistics Transformation Program

Site Visits Colonel Andy Maclean

Infrastructure Mr. Dave McGahey

Transition Mr. Dave McGahey

Indicative Timeline Mr. Dave McGahey

Next Steps Mr. Dave McGahey

Conclusion and Questions All




Purpose

The purpose of this presentation is to provide additional information for prospective tenderers regarding:

Warehousing & Distribution (W & D) services Request For Tender (RFT)

Land Materiel Maintenance (LMM) services RFT

Logistics Innovation

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Previous Briefings

It is recognised that attendees have attended/viewed previous Industry Briefs (18 Apr 11, 2 Nov 11), where background information about the program was provided and that information will not be replicated in this briefing Probity processes outlined in the presentation on 2 Nov 11, in particular the guidelines relating to the formation of consortia, remain in forceArchived briefs are available on the DLTP internet site: http://www.defence.gov.au/jlc/DLTP_Pages/Industry_Briefings_Archive.html

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OPENING ADDRESS

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DEFENCE LOGISTICS TRANSFORMATION PROGRAM OVERVIEW

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Overview

The Defence Logistics Transformation Program (DLTP) offers a generational opportunity for Defence, in collaboration with industry, to make unprecedented improvements to the logistics network in respect of infrastructure, technology and logistics service delivery. DLTP provides for:

the alignment to Strategic Reform Program logistics stream savings

the opportunity for transformation of the Defence logistics network

an improved contracting approach and outcomes

collaborative service delivery

DEFENCE LOGISTICS TRANSFORMATION PROGRAM

OVERVIEW8


LOGISTICS SERVICES SCOPE

9




Scope of Services

DLTP is proposing to seek logistics services from the commercialmarket with two discrete RFTs. The resultant contracts are intended to replace the:

Defence Integrated Distribution System contract;

Albury Wodonga Military Area contract for warehousing and land materiel maintenance; and

Hunter Valley Military Area Logistics Services contract.

LOGISTIC SERVICES SCOPE10


W & D SCOPE

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‘In Scope’ Defence Inventory

General Inventory which does not require special management and handling

Large, oversized and bulk equipment such as bridging and engineering stores

High Security Items which are sensitive and attractive

Equipment Pools held nationally or regionally available for loan by customer units

Dangerous Goods including hazardous goods and radioactive substances

Vehicles and associated equipment

Protective and Monitoring Equipment with climate controlled storage

Deep Storage Inventory that requires alternate storage methods

Shelf Life and Batch / Lot inventory that has a limited life / ‘use by date’ and requires specific traceability

12 WAREHOUSING AND DISTRIBUTION SCOPE




Warehousing Services

Inbound.

Planning and execution of receipt of inventory into storage locations

Inventory will originate from Defence’s suppliers, other contractors, customer units, and other sites in the network

Storage. Maintaining inventory in storage including:

Inventory accuracy

Maintenance-in-storage for specific inventory

Outbound. Planning and execution of:

Issuing inventory to customer units, other contractors or suppliers

Consolidation and despatch of consignments





Warehousing Services

Support to Operations & Exercises. Providing labour support within Australia to sustain Australian Defence Force operations and training exercises including:

Consolidating, despatching and receipting cargo to and from operations, exercises and activities

Storing specialist vehicles, equipment and stores

Kitting of forces with equipment for operations

Disposal Services. Conducting disposal activities including:

Disposing of inventory through prescribed disposal methods including sale/auction or destruction

Processing documentation and payments





Distribution Services

Planning and execution of distribution, in conjunction with the warehousing services, including:

Distribution of priority and routine freight (including vehicles) to a site or between units within Australia

Adherence to site specific service level agreements or agreed delivery timeframes

Providing visibility of status of distribution tasks

Loading/unloading freight at origin and destination (when required)

Providing temperature control and other specialised requirements(e.g. escorts for specialised equipment)



LMM SCOPE

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The maintenance requirements to be managed within the logistics network relate predominantly to land based equipment operated byArmy, Navy and Air Force. Equipment may include:

armoured and protected mobility vehicles

light, medium and heavy general transport vehicles

engineering plant and equipment

weapons and small arms

electronic, instrument and radio, and test equipment

a limited range of marine equipment

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Scope of LMM Services

LAND MATERIEL MAINTENANCE SCOPE




Roles and Responsibilities

It is intended that:

Defence retains responsibility for the management of LMM in a collaborative

arrangement with the Contractor

Contractor Personnel co-located with Defence will work together on planning

and scheduling activities

The Contractor will be largely responsible for the day to day operation of the

relevant functional areas in the workshop

The Contractor will be accountable for equipment under repair and Defence

provided materiel such as repair parts, specialist tools, jigs and fixtures

The Contractor will be accountable for the quality of the work it performs

LAND MATERIEL MAINTENANCE SCOPE

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Impact of Defence Materiel Organisation LMM Sustainment Contracts

LMM of vehicles/equipment within the Defence logistic network will continue to

be a core requirement but may be subject to the following changes:

A likely reduction in heavy grade repair and rebuild, offset by an increase

in regional equipment pool maintenance workload

LMM work will be rebalanced across the network and not necessarily

concentrated in the existing heavy repair sites

It is intended that Joint Logistic Command, Defence Materiel

Organisation and the Contractor will work collaboratively to bring new

Defence LMM work into the network

19 LAND MATERIEL MAINTENANCE SCOPE


SERVICE DELIVERY INTERFACE CONSIDERATIONS

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Defence has accountability to manage the effective interface of the

W & D and LMM functions, and each Contractor will have specific

responsibilities and obligations

Defence recognises the criticality and interdependence of the

interface between W & D and LMM services

Defence has reviewed the relevant processes will identify the

required Contractor interfaces in the RFT

Service Delivery Contractor Interfaces

21 SERVICE DELIVERY INTERFACE CONSIDERATIONS


INTERNATIONAL TRAFFIC IN ARMS REGULATIONS

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What is ITAR?

International Traffic in Arms Regulations (ITAR) govern the use of United States (U.S.) Defense inventory

Access by the Australian Defence Force to certain U.S. Defense inventory is conditional upon:

it only being used for the purposes authorised

it not being transferred from Defence to any third party without U.S. State Department approval

products not being transferred by any means to a company or individual in Australia or overseas without U.S. State Department approval

23 INTERNATIONAL TRAFFIC IN ARMS REGULATIONS




Why ITAR Applies to DLTP


A portion of Australian Defence inventory is US sourced and ITAR

controlled. Therefore, W & D and LMM contractors must be ITAR

compliant and have obtained U.S. authorisation

W & D and LMM Contractors are third parties for the purposes of

ITAR




ITAR Compliance Requirements


Pre Assessment Process

1. Defence advertises tenders and requests registration

2. Defence issues Deed of Confidentiality and Fidelity and letter to prospective tenderers requesting corporate information

3. Prospective tenderers respond with executed Deed and entity / consortia information

4. Defence submits ITAR pre-assessment to US State Department

5. US State Department provides response

6. Prospective tenderers are notified of approval or non approval

Final Approval Process

Defence assists to facilitate the approval process with preferred tenderer/s and the U.S. State Department on a case-by-case basis




Tender Response Considerations


Rapid responses by prospective tenderers to the Deed of

Confidentiality and Fidelity and accompanying letter will assist in

obtaining a timely pre-assessment from the U.S. State Department

All tendering entities, including subcontractors, are required to be

ITAR compliant

Defence reserves the discretion not to proceed to contract with a

preferred tenderer, if US State Department authorisation is not

forthcoming




Prospective Tenderers are responsible for any costs incurred for

achieving ITAR compliance. Further information can be found at:

http://www.pmddtc.state.gov/regulations_laws/itar_official.html

Further information on ITAR compliance can be found at: http://www.defence.gov.au/strategy/deco/publications/brochures/screen.pdf

Tender Response Considerations (cont.)



INFORMATION AND COMMUNICATION TECHNOLOGY

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WarehousingInformation and Communication Technology

The Military Integrated Logistics Information System (MILIS) will remain

the ‘system of record‘ for Defence inventory

Defence will source a Warehouse Management System to be interfaced

into MILIS

Fixed and wireless networks will support the Warehouse Management

System and will be made available to the Contractor

Information regarding the logistics systems will be provided to

prospective tenderers

29 INFORMATION AND COMMUNICATION TECHNOLOGY




Defence will require the Contractor to present certain distribution

data from the Contractor’s system for managing freight movement to

Defence’s Cargo Visibility System (CVS)

Data requirements will be provided to prospective tenderers

DistributionInformation and Communication Technology

30 INFORMATION AND COMMUNICATION TECHNOLOGY


COLLABORATIVE INNOVATION




Collaborative Innovation

Collaborative innovation is a culture that embraces innovation and continuous improvement in the management

of the transformed Defence logistics network.

32COLLABORATIVE INNOVATION




Innovation Responses to the RFT

Defence intends to invite prospective tenderers in both the W & D and

LMM RFTs to propose its approach to innovate and continuously

improve the Defence Logistics system such that levels of service are

maintained or improved, while the total cost to serve is lowered

over time

Defence recognises that the addition of commercial logistics

experience, knowledge and input into the operation of the logistics

network is a key driver of the innovation it seeks and will evaluate

proposed solutions from tenderers as to how this might best be

achieved





It is intended that the proposed capability which will drive this

innovation and continuous improvement will work collaboratively

with Defence to identify, implement, measure and sustain any such

improvements

Collaboration is also intended to enable genuine knowledge

sharing with Defence personnel and to further develop commercial

capacity to manage the delivery of logistics services






In addition to the other requirements of the RFT, Defence anticipates it

will seek responses that articulate:

a proven track record in innovation and continuous improvement

through the life of similar commercial undertakings

how the total cost of operations can be lowered while service levels

are maintained or improved

a system of measurement and reporting of innovation and benefits






Defence will consider sharing the demonstrable benefits from these

improvements

Tender responses will need to be prepared having regard to:

The Commonwealth regulatory and governance framework

Primacy of the military command at all levels

The need to use Defence ICT and facilities




SITE VISITS

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RFT Site Visits for Prospective Tenderers

Site visits form a critical component of the tender process and will take

place early in the tender response period

Site visits will commence about 2-3 weeks after the release of the RFTs

This is a one-off opportunity for prospectivel tenderers to be involved –

supplementary visits will not be offered

Limits may be placed on the number of bid team members who will be

able to take part in the visits

The site visit registration process and conditions will be described in

each RFT

38SITE VISITS




RFT Site Visits for Prospective Tenderers

All seven major sites will be visited. In addition, selected specific/unique

secondary sites may also be visited including:JLU(N). One day - RAAF Base Darwin, Winnellie, Robertson Barracks

JLU(NQ). One day - Lavarack Barracks and RAAF Base Townsville

JLU(SQ). One day - Bulimba Barracks, and Meeandah

DNSDC. Two days - Moorebank, West Wattle Grove, Singleton and RAAF Richmond

JLU(V). Two days - Bandiana and Puckapunyal

JLU(S). One day - Warradale Barracks and RAAF Base Edinburgh

JLU(W). One day - Palmer Barracks and HMAS Stirling

39SITE VISITS




RFT Site Visits – Key Planning Factors

Visits will be coordinated by DLTP, however, hosted and conducted

by each JLU in the network

Visitors to all sites will be escorted by Commonwealth personnel

Tenderers are responsible for their own travel and associated costs

between sites

The general theme of the presentations will be ‘a day in the life’ of a

JLU, describing its key management functions, processes and

facilities use

40SITE VISITS




Site Visit Program – Indicative Schedule

Length of the Site Visit Program is:

LMM: 10 working days

W & D: 10-12 working days

Mon Tue Wed Thur Fri Mon Tue Wed Thur Fri Mon Tue Wed Thurs

LMMTsvl Brisbane Sydney Sydney Albury Pucka Adelaide Perth Travel Darwin

W&D TEAM AAlbury Pucka Adelaide Perth Travel Darwin Travel Tsvl Brisbane Brisbane Sydney Sydney

W&D TEAM B (if reqd) Darwin Tsvl Brisbane Brisbane Sydney Sydney Albury Pucka Adelaide Perth

41SITE VISITS


INFRASTRUCTURE PROJECT

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DLTP Infrastructure

Works Package 1 (Moorebank and Bandiana)

50% Design – Late March 2012

Work Package 2 (Brisbane)

30% Design– Late February 2012

Works Package 3 (Townsville)

50% Design – Mid May 2012

Works Package 4 (Darwin)

50% Design – Mid May 2012

Works Package 5 (Adelaide)


Works Package 6 (Perth)


INFRASTRUCTURE PROJECT


TRANSITION

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J J

Program Phase

Indicative Transition Phasing2013 2014 2015

A M A S O N D J F M A M J J A S O N D J F

LogisticsServices

Facilities

Stock Migration

ICT

Stock Migration Period

WMS Implementation

Facilities Transition Period

W&D and LMM Services Transition Period

Phase 2 Phase 2 ‐‐ Logistics Services TransitionLogistics Services Transition

Phase 3 Phase 3 ‐‐ Site MigrationSite Migration

JLCC

ontractor(s)E

nabler

Organisation Organisation Changes Changes

45TRANSITION


INDICATIVE TIMELINE

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Procurement ProcessesIndicative Timing

• Deed of Confidentiality and Fidelity Planned by end February 2012

• W & D RFT and LMM RFT release Planned by end June 2012

• Industry briefings 7-10 days after RFT release

• Site visits 12-16 days after RFT release

• LMM Tender close Planned 3 mths after RFT releaseby end September 2012

• W&D Tender close Planned 4 mths after RFT releaseby end October 2012

• LMM Tender evaluation and selection completed Anticipated by end January 2013

• W & D Tender evaluation and selection completed Anticipated by end April 2013

• W & D and LMM Services transition commences 1 July 2013

47INDICATIVE TIMELINE


NEXT STEPS




Deeds of Confidentiality and Fidelity

The next step will be the release of the Deeds of Confidentiality and Fidelity to prospective tenderersThe Deeds will be available shortly after this Industry Brief and will be advised on AusTender and in newspaper advertisementsThe execution of a Deed by potential tenderers:

Is necessary to receive the relevant RFT documentation;Will be a condition for participation in the relevant tender process; andthe subsequent provision of additional information is intended to facilitate the commencement of the ITAR pre-approval process

49NEXT STEPS


CONCLUSION AND QUESTIONS

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defence logistics transformation program (dltp) industry briefing 20 feb.pdf · joint logistics...

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