Performance Based Logistics

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When a force needs to be scrambled to respond to an immediate threat, equipment needs to be instantly ready for deployment.

Mission scenarios are changing for the military. Reduced levels of major military conflict around the world have been counter-balanced by significant increases in less predictable, counter-insurgency style operations. When a force needs to be scrambled to respond to an immediate threat, equipment needs to be ready for deployment that very instant.

This is now reflected in the provision and support of military assets. Organizations are typically judged on product availability and performance over lifecycles that might last 50 years. Enter Performance Based Logistics (PBL) contracts. The US and UK have already realized the benefits of PBL contracts over the last decade. So much so, that it is now a mandated consideration for major new procurement projects.

Witness the fact that IFS has just announced the support of such provision into the UK MOD Military Flying Training System (MFTS). The UK MOD is currently investing $1.6 billion in the modernization of military flight training and IFS is providing software support to Affinity, the company responsible for supplying and maintaining the aircraft involved in the project as part of a long-term contract.

Industry Interest in Performance Based Logistics

The attraction is clear. If we take the example of a modern fast jet’s lifecycle, manufacturing and procurement constitute only 20% of the total cost of ownership. The remaining 80% of costs through life is taken up by in-service support. As a result, effective maintenance and operational support can help produce significant cost savings, while optimizing asset availability.

PBL contracts are one method of reducing the cost of supporting an asset through life, and this is not going unnoticed by key industry players.

Talking to National Defense Magazine in Q4 2015, Stephen King, Senior Manager of Product Support for Global Services and Support at Boeing, said:

“Against all of Boeing’s platforms, PBL is being assessed as a standard offer so every potential aircraft sale and/or sustainment business that we do, the question of, ‘Why not a PBL?’ is being asked internally and… most of the time externally with our customers.”

GE Aviation, the US Navy and IFS

General Electric’s F414 engine has powered the US F-18s for many years. Now, the F414 Enhanced Engine is delivering expanded capabilities for the next generation of combat needs with up to 18% more thrust and twice the horsepower of its predecessor.

The F414 uses IFS Aerospace and Defense (A&D) industry solutions for PBL in supporting the Navy’s inventory of more than 1,200 engines. It has delivered over $110 million in direct savings to the Navy Fleet Flying Hour Program and provided availability levels of over 95% as well as drive substantial infrastructure cost avoidances.

Performance Based Logistics

Setting the industry benchmark

The PBL project for the new, enhanced engine took another step toward transformation compared to previous GE support packages. It was given the Secretary of Defense Performance Based Logistics Component Level Award by the U.S. Department of Defense and was described as “setting the benchmark’ for performance-based engine support. It is a collaborative effort between GE Aviation, IFS North America, Sogeti USA and the US Navy PBL personnel.

Software support: The backbone of transformation

As with GE, much of the defense industry’s support transformation tends to start with manufacturing capability. The support partner then adds the support/MRO/fleet management/asset maintenance functionality as a particular defense organization travels “up the transformational staircase.” The transformation may be driven by visionary leadership, but often it is the result of financial and regulatory necessity.

Key to enabling this continuous, if not sometimes enforced, improvement process has been the adoption by the defense industry of enterprise management software that is able to ‘grow-as-they-go’ in an incremental process. Any supporting enterprise solution should be agile enough to keep pace with a step-change approach – further enabling defense organizations to execute maintenance and asset management through-life and keep mission-critical equipment at the ready efficiently.For more information on maintaining operational readiness, read this recent white paper: Ensuring military assets are at the ready – still the new approach? Performance Based Logistics up the transformational staircase.

For more information on maintaining operational readiness, read this recent white paper: Ensuring military assets are at the ready – still the new approach? Performance Based Logistics up the transformational staircase.


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