Issue Brief
Performance-Based Logistics (PBL) is the purchase of support as an integrated, affordable, performance package designed to optimize system readiness and meet performance goals through long-term support arrangements with clear lines of authority. PBL may be applied to defense systems, subsystems, secondary items, components, assemblies, sub-assemblies or business processes.
By shifting the logistics focus to whole platforms, total life-cycle management, performance results, rapid deployment, flexibility and sustainability and reliability of weapons and war-fighter support, PBL involves large scale transformations and it is clear that PBL can have a dramatic impact on both the cost and performance of sustainment and support activities. There are numerous and growing examples of the ways in which Performance-Based Agreements (PBA) are helping to transform the military’s supply chain. Among the now many examples of successful PBAs are:
- The C-17 Globemaster Sustainment Partnership between Boeing and Warner-Robins Air Logistics Center (ALC). In 2006, the program resulted in a fleet-wide mission capable rate of 85.4 percent;
- Warner Robins ALC and Northrop Grumman work share on JSTARS prime mission equipment, software and ground support systems;
- The Aegis SPY-Radar PBA between the Navy and Lockheed Martin;
- The F/A-18 E/F FIRST program between NAVICP and Boeing. This program increased aircraft availability from 67 percent to 85 percent, with enhanced reliability; and
- The APU partnership between Honeywell and NADEP Cherry Point; the NADEP serves as a sub-contractor supplying touch labor.
Since 2000, PBL has been the preferred DoD strategy for weapons systems support. Given its unquestioned record of success, the question is why are PBAs not common place? PBAs are still a comparatively small part of DoD’s overall sustainment effort. Moreover, there are only a handful of PBAs that cover most of a weapons system’s life-cycle support. By comparison, the United Kingdom recently awarded a PBA for the complete life-cycle support for its CH-47 helicopters.
There is also a need to educate contract officers and finance officials regarding the permissible scope of PBAs. There is a level of ignorance or willful blindness regarding PBLs that is rather inexplicable considering that the program has been officially sanctioned by DoD since 2000.
DoD needs to accelerate the process of converting weapons systems support activities to PBAs. Legal, regulatory and contracting barriers to PBAs need to be removed. In addition, DoD needs to educate its procurement officials on ways of implementing the PBL strategy.
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