Reform – Improving Forecasting to Increase Speed and Reliability

By Jennifer Blair, Public Affairs/Corporate Communications, NAVSUP Weapon Systems Support

In order to meet the fleet’s changing needs, NAVSUP launched a reform effort in April 2018 focused on streamlining requirements and acquisition processes to ensure the readiness and lethality of U.S. naval forces.

There are five value pillars under the reform program and four enablers. The value pillars serve as the core efforts to improve the way NAVSUP does business: Responsive Contracting, Customer Presence, Forecasting, Strategic Supplier Management, and Integrated Logistics. The four enablers focus on areas that will facilitate and amplify the impact of the core pillars: Driving Reform, Digital Accelerator, Audit, and Enable a New Era Workforce.

Each element of reform is led by a senior leader from the NAVSUP Enterprise and has a value team focused on improving business processes. NAVSUP Weapon Systems Support (WSS) Vice Commander Lynn Kohl is the sponsor for the Forecasting pillar, and the value team is led by John Bendick from the NAVSUP WSS Surface Operations Directorate.

The goal of the forecasting effort is to provide enhanced agility and customer service to the warfighter by leveraging advanced analytics and data feeds to better anticipate customer demand.

“Forecasting is our business,” said Kohl. “We need to make sure we’re improving our processes to provide exactly what our customer needs.”

The first step the team took was to hold workshops in Philadelphia and Mechanicsburg, Pennsylvania in order to identify the root causes of forecasting inaccuracy and brainstorm possible solutions. The team was able to pinpoint 153 root cause drivers and developed 39 potential pilot projects to address those causes. The potential pilots focused on ways to incorporate forward-looking customer maintenance planning, forecast for growing fleets, and improve comprehensive cycle time estimates.

Of the 39 potential pilots, the team chose three to focus on during the 18-month reform program – “Private Shipyard,” “Missing Repair Time in ERP,” and “Demand Accuracy.” “From a forecast accuracy perspective, there’s opportunity to improve overall,” said Bendick. “Today, our systems look backwards. We look back five years and try to predict what our demand will be, but past demand doesn’t always hold true to what we need now and in the future. With these pilots we’re taking a holistic approach based off our operational and maintenance knowledge to drive a better supply model.”

The “Private Shipyard” pilot focuses on improving communication with the shipyards to better anticipate needs prior to a ship’s arrival for maintenance and modernization. Under the current system, the shipyard may know two to three years in advance when a ship will arrive and what work they will need to perform. However, NAVSUP WSS may not know what parts are needed until the shipyard begins ordering materiel.

The team is working with the Regional Maintenance Centers to develop ways that NAVSUP WSS can know in advance what critical material or items with long lead times will be needed prior to the ship’s arrival at the shipyard.

“We want to avoid a parts delay when the ship is in for maintenance,” said Bendick. “To do that, we need more engagement with the shipyard. We’re leaning forward and putting ourselves into communities where we haven’t traditionally had a presence. This will allow us to gather better feedback and ultimately provide better service to the fleet.”

The second pilot the team is working on is “Missing Repair Time in ERP.” The team found that Enterprise Resource Planning (ERP) was recommending repair decisions too late, which was negatively affecting the fill rate. The ERP repair decision was based on a calculation that included demand and lead time. Upon further inspection, it was discovered that there were critical pieces missing from the equation.

The repair turnaround time in ERP only measured the time from when a vendor inducted an asset into repair until the time the repair was complete. The calculation did not include the days the part is in transit or account for delays that take place once the material is delivered to the vendor. “The team found an average of 80-120 days was missing from the overall repair time, which meant that we weren’t as efficient as we thought we were. Now we’re trying to load the true requirement,” said Bendick.

The additional time will soon be loaded into ERP. The team expects the change will start driving procurements in the December timeframe, with benefits beginning to show in calendar year 2020. “We made a significant change to the math model. It’s a large change that will do well, but it will take time to see the benefit,” said Bendick.

The third pilot, “Demand Accuracy,” focuses on overhauling the process for overriding the demand forecast in ERP.

“Because ERP only looks backwards, there are times when a supply planner may need to override the system, but it’s not straightforward,” said Bendick. “The engaged supply planner and integrated weapon system team can have valuable operational insight.”

To assist planners with override decisions, the team is developing a forecast accuracy policy and training materials aimed not only at implementing overrides, but monitoring the overrides.

“Ultimately, it’s about equipping our planners with the best knowledge and tools so they can make decisions that better serve the fleet,” said Bendick.

“Driving reform takes a consolidated effort to get things done,” he added. “We have good engagement from across the command and the full support of our leadership. Through reform, we’ve started looking towards the future and how we can best support a growing fleet.”

Winter 2019