Contracor Logistics Support in the U.S. Air Force

by Bioto, Michael; Cook, Cynthia R.; Graser, John C.

• ISBN13: 9780833045768
• ISBN10: 0833045768
• Format: Paperback
• Copyright: 2009-06-16
• Publisher: RAND Corporation

Summary

The Air Force has several options for sustaining weapon systems and components but has, in recent years, increasingly chosen contractor logistics support (CLS) over organic support. Still, questions remain about costs and efficiency, even about whether CLS is the best option. The authors explored these by reviewing the relevant laws and regulations, analyzing program and contract costs, and speaking with individuals involved in managing and contracting and budgeting for CLS contracts. The authors noted that CLS contracts have often been awarded to original equipment manufacturers because, lacking the technical data, the Air Force could not choose a third party. Without competition, the price of CLS contracts is often determined by analysis and negotiation. They also noted that contracts that guarantee large annual sums limit the Air Force's ability to adjust when its own funding changes. The Air Force has taken steps to assess requirements for technical data early in the acquisition process and to use contracting provisions that allow funding levels to be more flexible. Requiring the reporting and collection of detailed CLS costs in a standardized format and making the data available to program offices across the Air Force would further strengthen the Air Force's ability to obtain favorable prices. Book jacket.

Table of Contents

Preface	p. iii
Figures	p. ix
Tables	p. xi
Summary	p. xiii
Acknowledgments	p. xix
Abbreviations	p. xxiii
Introduction	p. 1
Maintenance of Weapon Systems and the Use of Contractor Logistics Support	p. 1
Purpose of This Monograph	p. 4
Research Approach	p. 5
Organization of This Monograph	p. 7
Chapter 2	p. 9
Background	p. 10
Key Laws Affecting CLS Use	p. 10
Key DoD Directives and Instructions That Affect CLS	p. 12
Key Air Force Direction That Affects CLS	p. 13
Implications of Laws and Regulations That Affect CLS Use	p. 15
Chapter 3	p. 17
Findings and Observations: CLS Funding and Costs	p. 18
How Does the Air Force Define CLS for Funding and Costing?	p. 18
What Programs Use CLS, and How Much Does Each Spend on CLS?	p. 24
Programs That Account for the Growth in CLS Over the Last Seven Years	p. 26
What Are the Key Cost Drivers for CLS?	p. 29
Observations and Conclusions About CLS Funding and Costs	p. 33
Chapter 4	p. 35
Cost and Performance: Comparing CLS with Organic Support	p. 35
How Does the Government Measure CLS Performance and Using What Metrics?	p. 35
What Has Contractor Cost Performance Been Like for Major Programs Using CLS?	p. 38
How Effective Has CLS Proven for Major Programs Using CLS?	p. 43
Discussion on CLS Supply Support	p. 45
How Does CLS Price Growth Compare to Organic Cost Growth?	p. 47
Do Contractors Have Inherent Advantages or Disadvantages in Performing Some Tasks?	p. 49
Observations on CLS Performance	p. 51
Conclusion	p. 52
CLS Management	p. 55
Current Processes for Choosing CLS and Ongoing CLS Management	p. 55
Reasons Existing Programs Use CLS	p. 57
How Are Tasks on CLS Contracts Defined and Funded?	p. 65
Why Do CLS Contracts Have So Little Variable Funding?	p. 68
How Much Insight Does the Government Have Into the Contractor's Costs?	p. 69
How Are CLS Contract Prices Determined?	p. 72
Observations on CLS Management	p. 73
Implications for Cost Analysts	p. 75
Funding Sources May Shift at Different Stages of Support	p. 75
CLS Affects the Amounts and Proportions of Costs Reported in Non-CLS O&S Elements	p. 76
The Nature and Scope of CLS Tasks Differ Among Programs	p. 76
Cost and Cost Growth	p. 77
Some CLS Costs Are Accounted for Differently Than Are the Corresponding Organic Costs	p. 78
It Is Difficult to Generate Cost-Estimating Relationships for Total System O&S Costs Because Funding Constraints Affect Much of the Total Cost	p. 78
Summary and Recommendations	p. 81
Summary of Findings	p. 81
Recommendations	p. 82
Require Centralized Decisions on Buying Design and Technical Data or Use Rights to Data	p. 83
Require a Uniform Format for Cost Data	p. 85
Provide Centralized Guidance to Achieve Flexibility	p. 87
Strengthen Centralized Expertise to Optimize CLS Use	p. 88
Retain Choices for Logistics Services	p. 91
Appendixes
A	p. 93
B	p. 99
References	p. 125
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