Medical Initiative to Save Estimated $254 M, Improve Warfighter Support

A new initiative Defense Logistics Agency Troop Support Medical is participating in could realize $254.1 million in savings to customers over five years, while improving support to warfighters.

Nancy Richardson, of the DLA Troop Support Medical forward cell at Fort Detrick, Md., leads a joint working group that includes representatives from DLA, each of the services’ medical logistics field agencies and commands, and the Defense Medical Logistics Standard Support program office. The group is sponsored by the Office of the Secretary of Defense.

Richardson said the initiative focuses on the Department of Defense substantially reducing the costs of medical material by educating customers on the best sourcing options and providing the business intelligence tools to help them make the best decisions.

DLA Troop Support Commander Navy Rear Adm. David Baucom said he is particularly proud of the logistics efficiency initiative.

“It is the most frugal and innovative for America’s taxpayers,” he said.

The initiative identifies the extent and cause of DOD customers purchasing medical material from sub-optimal and expensive sources like local vendors or credit card buys and redirects sales to optimal e-commerce sources like prime vendor or electronic catalog.

E-commerce enables DOD to consolidate medical material requirements and leverage them to obtain favorable prices, Richardson said.

“By moving the purchases to e-commerce, we buy the product the warfighter requires at a lower cost and deliver it much faster,” she said. “In most cases our e-commerce programs make deliveries in one to seven days while manual purchases deliver in two to four weeks.”

Many of the e-commerce tools also lessen administrative workload for customers by avoiding individual, manual purchases. Since these savings relate more to administrative costs, they are not included in the total savings.

Richardson said DLA Troop Support has some of the best business intelligence tools in the medical supply chain, both within the federal government and the commercial sector. She explained how tools like EzSave and Best Pharmacy Report empower customers to identify opportunities to improve their sourcing decisions in both the medical/surgical and pharmaceuticals areas.

“The ability of our tools to rapidly sort through and cross-reference the myriad of product codes and identifiers to make the necessary comparisons is a cut above,” she said.

Richardson emphasized teaming, communications and planning as the cornerstones of the team’s success.

“I act more as a consensus builder than a leader by identifying the various courses of action available and then work to build consensus for the best choice,” she said “I assist in developing the plans to implement the joint decision and the metrics to measure success.”

Richardson said she credits communication as a critical role in the program’s success.

“It was the group’s effective planning and communication of proposed actions, up and down the chain of command, as well as through the service component and OSD (Office of the Secretary of Defense) senior leadership levels, that earned us the credibility, respect and acceptance necessary to pull the entire initiative together,” she said.

The group has an approved plan of action and milestones that serve as a road map for the next five years. Richardson said many of the planned actions require customer training in using business intelligence tools, and that training has already begun. The next milestone is to establish the baseline used to measure success entering fiscal 2012.

“I believe we surprised a lot of senior people on the OSD staff by accepting their challenge and producing tangible results,” she said. “Normally, budget cuts are a contentious issue. Our team has proven that teamwork, ingenuity and a willingness to contribute can replace contention with cooperation and success.”

By Defense Logistics Agency – US Army