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INNOVATION DELIVERING EXCELLENCE

INNOVATION DELIVERING EXCELLENCE

Savings: Delivered

Paragon Delivers Impressive Results For USTRANSCOM

Savings: Delivered
Savings: Delivered
Savings: Delivered

"The Paragon Team made a huge impact on key decisions made by senior leadership regarding cost-saving and process improvement within the DOD."

CUSTOMER OVERVIEW

As the single manager of America's global defense transportation system (DTS), United States Transportation Command (USTRANSCOM) provides military and commercial air, land and sea transportation assets to all Department of Defense (DOD) agencies. USTRANSCOM also allows the United States to project and sustain forces, whenever, wherever, and for as long as they are needed by providing terminal management and aerial refueling — in time of peace and time of war. Established at Scott Air Force Base Illinois in 1987, USTRANSCOM is one of the DOD's nine unified combatant commands with missions assigned by the president of the United States.

Among its responsibilities, USTRANSCOM serves as the DOD Distribution Process Owner (DPO) to:

  • Coordinate and oversee the DOD distribution system.
  • Identify distribution process improvements that enhance the effectiveness and efficiency of defense logistics and global supply chain management systems providing vital support to warfighters.
  • Collaborate with stakeholders in developing and implementing distribution process improvements.

In this role, USTRANSCOM utilized Paragon to ensure efficiency and success under stringent budget requirements.

BUSINESS CHALLENGE

USTRANSCOM is in charge of improving overall efficiency and interoperability of distribution-related activities — deployment, sustainment, and redeployment support during peacetime, contingencies, crisis and war. However, improvements for future joint endeavors must not sacrifice our nation's ability to provide superior support for current operations.

As the U.S. government seeks solutions to long-term deficit-reduction challenges, USTRANSCOM is committed to preserving current effectiveness, reducing DTS energy consumption and introducing distribution processes that improve performance while reducing costs.

Using integrated cost and operations data to continue to enable monitoring and optimizing the efficiency and effectiveness of the DTS, Paragon applied commercial supply chain best practices and financial analysis to the Joint Deployment and Distribution Enterprise (JDDE). The implementation produced successful savings and improvements in efficiency and effectiveness. Proven continuous process improvement methods yielded significant improvements to effectiveness while simultaneously reducing net overall distribution costs to the warfighter.

HOW PARAGON HELPED

Paragon helped USTRANSCOM improve the DOD supply chain through a series of DPO Strategic Opportunities (DSO) initiatives, supported by institutional performance metrics and collaborative analysis. DSO initiatives include five major opportunities to enhance readiness, improve velocity and reduce DOD supply chain costs. Two of these opportunities — Strategic Surface Optimization and Strategic Air Optimization — lower the cost of distribution by better consolidating cargo and modifying container and pallet build business process rules to gain better utilization.

Within Strategic Air Optimization, the Next Generation Cargo Capability initiative improved aircraft cargo utilization at major continental Air Mobility Command (AMC) aerial ports. This initiative focuses on improving cargo processing, implementing new cargo aggregation standards, and balancing airlift availability with cargo generation. Enterprise pallet and aircraft utilization has increased by 10 percent since the August 2010 implementation at Dover Air Force Base (Delaware) and subsequently at Joint Base McGuire-Dix-Lakehurst (New Jersey), Travis Air Force Base (California) and Naval Air Station Norfolk (Virginia). Increases in pallet and aircraft utilization translate to lower enterprise costs and supports multiple DPO initiatives such as fuel savings.

The Strategic Surface Route Plan initiative combined cargo for multiple customer locations in Iraq into a single container. Consolidating cargo improved container utilization to these locations, reducing the number of containers required for shipment and thereby decreasing over-ocean transportation cost. The Strategic Surface Optimization team also analyzed the nature and volume of cargo being moved in Afghanistan. Through this process and by switching from 20' containers to 40' containers, cargo capacity nearly doubled with minimal cost difference.

TANGIBLE BUSINESS RESULTS

Since implementing Strategic Air Optimization initiatives, USTRANSCOM reduced the cost per pound of cargo moved by up to $0.88 per pound, resulting in more than $417 million in air distribution costs. Similarly, Strategic Surface Optimization initiatives saved more than $259 million cost avoidance in ground transportation costs.

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