Logistics management issues for military systems approaching the end of service life

Abstract

Many concepts and models have been proposed and implemented to support the logistics management of physical assets through their service life. These concepts and models generally focus on a 'steady state' or 'mature' phase of the idealised asset life-cycle, and as such make a number of appropriate simplifying assumptions. As an asset approaches the end of its service life many of these assumptions become questionable and new logistics and fleet management issues begin to arise which potentially require the consideration of new concepts and models. A military system fleet approaching the end of its service life will continue to need ongoing support, which potentially includes support in operations. For this, fleet managers need to continue to invest in inventory to meet preparedness requirements and address potential obsolescence, phase out demand and discontinued supply issues; despite the fact that the fleet has a looming end of service life date. However, the desire not to over invest in inventory as an asset approaches the end of service life is balancing against these needs, as this can tie up financial resources and potentially add to labour, warehousing, transport and eventual asset disposal costs. These matters create tensions between effectiveness and efficiency considerations as system fleets reach the end of their service life. Past experience often suggest these issues are a secondary consideration in fleet management. This paper will explore a range of end of service life logistic issues including approaches to the inventory management functions of requirements determination, and replenishment planning. We will consider some standard approaches to these functions and highlight how end of service life considerations may require new management heuristics and process models. In particular, we investigate efforts to integrate a spare parts management (SPM) phase out strategy. This includes seeking a process for developing options, and goal setting the final state of the spare parts inventory at the asset's end of life date. This can then modify demand forecasting selection processes and calculations for replenishment actions. Importantly, inventory segmentation can play a role to determine how to treat various asset spare parts based on factors such as supply characteristics, demand, cost, stock on hand and relationships to other parts of the asset sustainment system. How these factors can be integrated into a management model for decision policy is a focus of our discussion. We then present a management process model to indicate which replenishment actions suit particular items in the inventory based upon phase out segmentation analysis and a desired end of service state. In doing so, a number of key end-of-service life policy options can be proposed. This can aid military planners to oversee inventory management of assets that are approaching end of life.