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Accurately reporting supply chain actions for nontraditional maintenance.

Introduction

During the last few years, the Air Force has increased its use of less traditional maintenance concepts such as transitioning some items for repair from a base to a consolidated repair facility, and by using more warranties to maintain reparable parts. The traditional repair at a base or depot is no longer the only way to repair and sustain parts. However, the Air Force's current supply chain system (used to compute spares requires and set base and depot levels) does not model these less traditional maintenance concepts.

As a result, item managers and base personnel have identified cases where there are no demand levels to support high-demand items and the Air Force computed requirement is too small to adequately meet demand. For example, the sum of Standard Base Supply System (SBSS) demands reported to the Readiness Based Leveling (RBL) system was different than the sum of demands reported to the Secondary Item Requirements System (D200A). Therefore, RBL could not allocate a level to a base for a high-demand item because the requirements system did not record those demands and generate a sufficiently high requirement. With the use of less traditional maintenance concepts increasing, it is important that the Air Force supply requirements and leveling systems accurately model and compute requirements and allocate levels.

Current Demand Reporting Process

Air Force-managed reparable item demands recorded in the SBSS are reported to the Secondary Item Requirements System (D200A) and to RBL. D200A uses a national stock number's (NSN) SBSS reported demands, along with other data, to compute the worldwide requirement (WWR) necessary to support future customer demands. RBL uses SBSS reported demands to optimally allocate the computed WWR to using bases. In theory, the D200A-computed WWR should be the same as the sum of RBL-computed levels required to fill the worldwide need. However, there are cases where base needs (expected pipeline demand) (1) are greater than the D200A-computed WWR. In these cases, RBL assigns a problem item flag to the item indicating there is a data discrepancy that should be researched and resolved.

There are various reasons for cases where an item's RBL computed base need is greater than the item's WWR (such as D200A factors, file maintenance, and dirty data). This article focuses on reasons related to the CRF and warranty maintenance concepts.

What we found was the current methods used to record and report demands and compute pipelines do not adequately model the actual repair process for CRFs and warranted items. As a result, there is a difference in the D200A-computed need compared to the RBL-computed pipeline need; and neither currently matches the actual need. Thus, RBL levels are not being properly allocated for some items repaired at CRF locations and warranted items nor is the worldwide requirement accurately computed.

CRF Demand Data Reporting

Reporting SBSS Demands to D200A. In order to calculate worldwide requirements, D200A needs historical demand data from all SBSS accounts. SBSS demands are reported to D200A via 7SC images on a quarterly basis. (2) The number of demands reported for each NSN via the 7SC (3) is based on transaction history records created during the applicable quarter. Demands are reported to D200A as one of the following three actions: not reparable this station (NRTS), repaired this station (RTS), or condemned (COND). For example, in the first quarter (January to March) of calendar year 2010, a 7SC for NSN 1 at base X may reflect 2 NRTS actions and 3 RTS actions resulting in 5 total repair generations at base X; however, there may have been other REPGENS that were not reported on the 7SC because they were not considered demands (cannot duplicate actions) (4).

Reporting SBSS Demands to RILL. In order to calculate demand-based levels for each SBSS, RBL needs historical demand data and pipeline information from all SBSS accounts. Specifically, RBL needs the daily demand rate (DDR), the percentage of base repair (PBR), the order and ship time, the NRTS/condemned time (NCT) and the base repair cycle time.

This information is reported to RBL at least once a quarter via XCB images, not 7SC images. (5) SBSS does not record a demand for a reparable NSN at the time of the customer request. Instead, SBSS records the demand when the failed item is turned in to supply (either serviceable or unserviceable). That is, after a final repair decision has been made.

The final repair decision is identified by the action taken code (ATC) provided by the maintenance activity. Recording demand at the time of the turn-in ensures a valid failure occurred before a demand is recorded. For items repaired at the using base or shipped to the depot for repair, demand recording has no impact on the number of demands SBSS reports to D200A and RBL. However, for items where the using base must defer repair decisions to a CRF, the demand recording process can result in SBSS reporting a different number of demands to RBL than are reported to D200A.

SBSS logic counts turn-in transactions that generate a shipment to a CRF (turn-ins with an ATC D) as demands (NRTS) and thus reports those demands to RBL. However, by design, 7SC logic does not count ATC D turn-ins as demands because the final repair action is unknown. When CRF personnel determine the final repair action, a turn-in with the appropriate ATC is processed in the CRF SBSS. The ATC on the CRF turn-in determines if the repair action is recorded as a demand on the 7SC and thus reported to D200A.

For example, assume an NSN at a supported base (6) had six turn-in transactions with ATC D and that all six unserviceable assets were shipped to a CRF for repair. If the CRF turned-in all six assets with an ATC that counts as a demand in the 7SC logic, then the number of demands (6) reported via an XCB from the using base would equal the number of demands (6) reported by the CRF via 7SC. However, CRF turn-ins processed with ATCs that the 7SC logic does not count as a demand (cannot duplicate, ATC B) result in cases where more demands are reported to RBL than are reported to D200A.

Analysis Results. To determine the number of turn-ins processed by CRF activities using a noncounting ATC, SBSS transaction history records at SRANs 1819 and 1820 were scanned. (7)

Note in Table 1 over 44 percent of the turn-ins were nondemand counters at the CRF. The supported base reported these turn-ins as demands to RBL (via XCB), but neither the supported base nor the CRF reported them as demands to D200A (via 7SC). The volume of no failure (such as ATC B) turn-ins indicates the Air Force should account for these maintenance actions because the CRF- supported base had a need (with a related pipeline) that needed to be filled. We recommend reporting CRF ATC B turn-ins as RTS actions to D200A when the asset being turned-in can be traced back to an unserviceable, but reparable shipment from a base supported by the CRF. Doing so would decrease the differences in the number of demands reported by SBSS to RBL and D200A.

The high number of nondemand CRF actions (ATC B) raises another issue. These 1.8K occurrences represent 3.6K (8) unnecessary shipments, plus an added 6 to 20 days pipeline delay in providing serviceable assets to the supported bases. Items with a high number (9) of ATC B turn-ins should either not be repaired at CRF locations or closer management attention is needed to determine the cause of the high number of ATC B turn-ins. The CRF operations commander should monitor the repair actions and take appropriate action to reduce unnecessary transportation costs and needless pipeline delays.

Duplicate Demand Reporting to RBL. Under the CRF concept, SBSS demands have potential to be reported twice to RBL. For example, a NRTS D turn-in processed at a CRF-supported base is reported by the supported base as a demand to RBL. The subsequent turn-in (for the same item) at the CRF may also be reported as a demand to RBL, depending on the ATC.

Consider the previous example of the NSN at a supported base that had six turn-in transactions with ATC D, with all six unserviceable assets shipped to a CRF for repair. Recall the supported base SBSS records ATC D turn-ins as demands, and in-turn, reports the demands to RBL. If the CRF turned-in all six assets with an ATC that counted as a demand, then the CRF SBSS would also record six demands and report them to RBL. So in this example, the number of demands reported to RBL would be 12 and the number of demands reported to D200A would be 6.

To prevent duplicate demand reporting, the SBSS was modified to provide an indicator on the XCB image for each NSN that had a maximum adjusted stock level (ASL) of zero loaded at a CRF base. The indicator was intended to alert RBL to ignore the daily demand rate reported on applicable XCBs from the CRF, thereby preventing RBL from receiving and using duplicate demand reports from SBSS. Line replaceable units (LRU) at CRF locations should have a maximum ASL 0 loaded to prevent a peacetime level at the CRF because the CRF does not consume LRUs--it repairs them.

CRF Pipeline. The CRF concept creates a challenge to providing RBL with the correct repair pipeline times from CRF-supported bases. Currently, CRF-supported bases report zero PBR capability for items that are shipped to the CRF for repair. As a result, RBL uses the base's NCT, order and ship time, and the depot repair cycle time (RCT) to calculate the CRF-supported base pipeline need. In actuality, the pipeline need consists of the base's NCT, retrograde time, and the CRF RCT.

The number of days in a depot RCT is usually significantly more than the number of days in a CRF RCT. Table 2 shows the minimum, maximum, and average depot and CRF RCTs in the RBL central leveling summary file (April 2010) for 108 LRU NSNs at the Tyndall or Hurlburt Field CRF.

The difference in the average depot RCT and the average CRF RCT was almost 80 days. This gap is slightly overstated because the retrograde time and the base processing time are included in the depot repair cycle time. But even if those segments together took 20 days, the difference is still around 60 days. Therefore, pipeline times currently reported by CRF-supported bases are incorrect and actions should be taken to report the correct pipeline times.

Note the retrograde time and CRF RCT are captured and reported to RBL by the CRF location, but stock levels are not needed (for LRUs) at the CRF. Instead, levels are needed at bases supported by the CRF to fill the repair pipeline.

In order to report the correct repair pipeline from CRF-supported bases on NSNs shipped to the CRF for repair, the CRF should be viewed as a repair backshop for each supported base. Further, an assumption should be made that each unserviceable asset shipped to the CRF is repaired by the CRF. That is, change SBSS demand recording so that an ATC D turn-in at a CRF-supported base is recorded as an RTS action (instead of NRTS) at the applicable CRF-supported base. Doing so would result in SBSS reporting a positive PBR to RBL, which in turn would cause RBL to use the reported base RCT to calculate the pipeline quantity. The reported base RCT in these cases would be the sum of the base NCT, retrograde time, and CRF RCT. No change is required in 7SC logic since the ATC D turn-ins do not count as demands.

The drawback to such a change is that all CRF NRTS actions would be reported to RBL as RTS actions. To determine the impact, refer to Table 2 and note that 18 percent (740/ 4,102) of the turn-ins were processed with an ATC 1 (NRTS) at the CRF locations. (10) This indicates the CRF shipped these items to the depot for repair. Thus, counting all NRTS D turn-ins at CRF-supported bases as repairs would be an 82 percent solution. That is, the correct repair pipeline would have been reported in 82 percent of the observed cases, as opposed to the current method of not reporting the correct pipeline in any cases.

CRF Summary. For items repaired at CRFs, the logic used to record SBSS demands caused a significant difference in the number of demands reported to D200A versus the number of demands reported to RBL. D200A did not receive demand data for 44 percent (1,805/4,102) of the reparable generations at the CRF activities over a 17-month period. Further, demands associated with RTS and NRTS actions at the CRFs were reported twice to RBL; once by the supported base and once by the CRF. Additionally, the repair pipeline reported to RBL was incorrect (too long). These factors resulted in 29 percent of the NSNs repaired at the two CRFs being flagged as RBL problem items (because the subsequent worldwide requirement computed by D200A was understated and the base need computed by RBL was overstated). The sum of worldwide expected back orders computed by RBL for these 31 items was 331. Without corrective action, the number of problem items will continue to grow, especially given the expected increase in CRF activity. Our recommendations will: 1) result in SBSS reporting the same number of demands to RBL as are reported to D200A; 2) report the correct repair pipeline time in more than 80 percent of the cases, and; 3) provide more accurate requirements data.

Warranted Items

There is confusion regarding supply procedures for processing unserviceable Air Force-managed reparable assets that are covered under the Reliability Improvement Warranty (RIW) program. As a result, some bases have RIW assets that fail but the subsequent demand is not captured in the SBSS; thus, a positive RBL is not established and future demands result in customer back orders.

To identify an NSN in the RIW program, the responsible item manager loads a Reparable Item Movement Control System (RIMCS) code of G to the NSN in the Stock Control System (SCS). The SCS in turn notifies using SBSS accounts of the RIMCS code G assignment. Items identified as being covered under the R1W program have a repair warranty, and when found to be unserviceable, they should be returned to the contractor for repair and replacement at no cost.

Currently, RIW item failures are not counted as demands at the bases where failures occur. As a result, stock levels at bases will not be sufficient to support customer demands. Even though the Air Force should not procure replacement assets for warranted items, usage data is needed to determine the correct level to allocate to using bases. If demands are not recorded, the D200A computed requirement (that RBL uses to allocate levels) may be too small to fill the supply chain (contractor repair pipeline), thereby failing to adequately support the mission.

Currently, item managers use SBSS-reported demands and repair data provided by the repair contractor to determine the number of demands that should be reflected in D200A. Because not all SBSS demands for RIW items are reported, item managers do not have an accurate number of item failures from SBSS to compare to the number of repairs reported by the repair contractor. As a result, the computed worldwide requirement could be too small or too large. In either case, mission support suffers due to misallocated levels.

Current policy (TO 00-35D-54, USAF Deficiency Reporting, Investigation, and Resolution; and AFMAN 23-110, USAF Supply Manual) states unserviceable RIW items should be processed so that their failures are recorded as demands in SBSS and reported to D200A and RBL. Further, organizations turning in unserviceable RIW items should receive credit (upon turn-in) at the exchange price (not charged for contractor repair of the item).

Number of Warranty-Coded Items. To determine the number of warranty-coded items, SBSS repair cycle records as of 30 June 2010 were reviewed. The resulting NSNs were compared to a file of RIW NSNs obtained from the SCS. See Table 3 for comparison results.

Table 3 shows 88 NSNs were coded as RIW in both SBSS and the SCS--30 NSNs were coded as RIW in only SBSS, and 10 NSNs were coded as RIW in only SCS. The SCS is considered the source of truth in regards to RIMCS codes; therefore, the accurate number of NSNs assigned a RIMCS G is 98.

Note that 40 (of the 126) NSNs contained the incorrect warranty code in SBSS. That is, 30 NSNs had warranty codes but should not have, and 10 NSNs did not have warranty codes but should have.

Number of Warranty-Coded Item Failures. To determine the number of RIW item failures over a one-year period, SBSS transaction history records (for the 88 Air Force-managed NSNs coded as RIW items in both SCS and SBSS) were scanned to identify turn-in transactions that occurred from 1 July 2009 through 30 June 2010. There were 5,443 warranted item failures for the year.

Forty-three percent (2,346/5,443) of the turn-ins for RIW items during the past year were processed with an action taken code (C-repaired deferred) that did not record demands, and 38 percent (2,074/5,443) were processed with an ATC (1-repair not authorized) that did record demands. There appears to be an inconsistency on how to process unserviceable asset turn-ins in SBSS for NSNs coded as RIW. The current process is a manual workaround. Bases are to use ATC C (not record demands and not incur any working capital funds charges) and to load demand data using two FRR transactions. One FRR transaction is to load the demand data and one is to load the correct pipeline times. Thus base personnel must process 3 different transactions to ensure the correct demand and pipeline data recording. Eleven percent (612/5,443) of the turn-ins contained an ATC (A-repaired) that indicated warranted items were repaired at base level (and demands were recorded).

To determine the impact of not following the correct procedures (the workaround), the 656 NSN/SRAN cases associated with the 2,346 turn-ins for RIW items that were processed with an ATC C were reviewed. These NSN/SRAN cases should have a positive DDR in SBSS (and RBL) due to the turn-ins processed. To see how many cases actually had a positive RBL DDR or RBL level, RBL data from July 2009 and July 2010 was examined. Mission capable (MICAP) data from 1 July 2009 through 30 June 2010, and from 1 July 2010 through 5 December 2010 for the 656 NSN/SRAN cases was also examined to see if the July 2009 and July 2010 RBL levels were sufficient to meet future demands. The results are shown in Tables 4 and 5.

Over half of the RIW NSN/SRAN cases have either 0 or no RBL DDR (even though they had demands) and thus, no RBL levels (in both the July 2009 and July 2010 RBL data). These RIW items are of the most concern because, due to the turn-ins processed, these items should have a positive SBSS and thus, RBL DDR. These 0 or no RBL DDR cases account for 456 MICAP occurrences from July 2009 to July 2010. The number of MICAPs associated with these items may have been reduced if customer demands were recorded in SBSS and RBL.

Summary

AFMAN 23-110 guidance states that failures for RIW items should be handled under normal supply procedures and that customers should receive credit (at the exchange price) for failed RIW items. While AFMAN 23-110 contains procedures on how to process SBSS turn-in transactions for RIW items, these procedures do not work." To compensate, a manually intensive workaround is in place. The workaround is sometimes followed and sometimes not. If a base does not follow the workaround, customer demands are not recorded in SBSS or RBL, resulting in the using base receiving a demand-based level that is insufficient to meet future demands. The insufficient demands result in MICAP back orders that most likely could have been avoided. Implementing this article's recommendations (correct the difficulty report [DIREP]) will improve the accuracy of usage data used to compute demand-based levels for RIW NSNs thus providing the potential to prevent MICAP back orders for items.

Douglas J. Blazer, PhD, DAF

Woodrow A. Parrish, DAF

Notes

(1.) RBL computes the expected demand during the base repair time. Basically it is the base's daily demand rate times the time in the base repair cycle.

(2.) The first three positions of the transaction image are 7SC. Thus, the image is named 7SC.

(3.) Details concerning 7SC logic can be found in Air Force Manual (AFMAN) 23-110, USAF Supply Manual, Volume 2, Part 2, Chapter 19, Table 19B34.1 Recoverable Item (XF3/XD2) 7SC Logic.

(4.) Cannot duplicate means maintenance checked the suspected failed part and found nothing wrong with it. Basically the item did not fail, and therefore no demand is recorded.

(5.) The first three positions of the transaction image are XCB. Thus, the image is named XCB.

(6.) The term supported base is used to identify a base that receives repair support from a CRF.

(7.) The transaction history scan selected turn-in transactions at FB 1819 and FB 1820 from 1 January 2009 through 14 July 2010 where the NSN was equal to one of the 124 (85 at FB1819 and 39 at FB1820) line replaceable units (LRU) NSNs, the activity code on the document number was equal to C and the type transaction phrase code was equal to 20.

(8.) There were two shipments for each ATC B turn-in; one shipment from the supported base to the CRF and one shipment from the CRF to a base with a need.

(9.) Twenty percent (20/100) of the NSNs with ATC B turn-ins accounted for almost 60 percent (1,005/ 1,805) of the total ATC B turn-ins. Two NSNs had more than 75 ATC B turn-ins.

(10.) NRTS 1 turn-ins at the CRF location indicates the CRF shipped the unserviceable item to depot for repair. Why the CRF deferred repair to the depot in these cases is outside the scope of this analysis.

(11.) There is a deficiency report (DIREP) in the system to correct the RIW process.

Douglas J. Blazer, PhD, is a principal advisor for Air Force Directorate of Transformation (AF/A4I). He is a recognized expert on matters concerning the Air Force supply system. He is also a frequent contributor to the Air Force Journal of Logistics.

Woodrow A. Parrish is a Supply Chain Analyst at the Air Force Logistics Management Agency, Maxwell AFB, Gunter Annex, Alabama. He is a recognized expert in supply chain management, with more than 30 years experience in Air Force retail supply systems.
Table 1. Frequency Distribution of CRF Turn-In Transactions by
Action Taken

Actions      Total   Percentage

NRTS           740     18.0%
Repairs      1,539     37.5%
No Failure   1,815     44.4%
TOTALS       4,102      100%

Table 2. Comparing Depot RCTs to CRF RCTs

          Depot RCT   CRF RCT

Minimum       16          1
Maximum      180         10
Average       85        6.3

Table 3. Count of RIW Items in SBSS and SCS

        In    In SBSS   In SCS
       Both    Only      Only    Total

SBSS    88      30         0      118
SCS     88       0        10       98

Table 4. RBL DDR versus MICAPs--July 2009

              NSN/    No                            Did Not
              SRAN    RBL                           Have a
  RBL DDR     Cases   Lvl   RBL=O   RBL=1   RBL>1    MICAP

No DDR          59    59       0       0      0        23
0              367     0     355      10      2       246
0-0.0055        83     0      37      37      9        52
0.0055-0.01     65     0      28      32      5        38
> 0.01          82     0       6      33     43        45
Total          656    59     426     112     59       404

              Had a   Total
  RBL DDR     MICAP   MICAPs

No DDR          36      70
0              121     263
0-0.0055        31      82
0.0055-0.01     27      64
> 0.01          37     128
Total          252     607

Table 5. RBL DDR versus MICAPs--July 2010

              NSN/    No                            Did Not
    RBL       SRAN    RBL                           Have a
    DDR       Cases   Lvl   RBL=O   RBL=1   RBL>1    MICAP

No DDR          22    22       0       0      0        20
0              365     0     345      17      3       308
0-0.0055        87     0      41      44      2        73
0.0055-0.01     89     0      28      50     11        68
> 0.01          93     0      14      25     54        65
Total          656    22     428     136     70       534

    RBL       Had a   Total
    DDR       MICAP   MICAPs

No DDR           2       6
0               57     117
0-0.0055        14      24
0.0055-0.01     21      65
> 0.01          28     111
Total          122     323
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Title Annotation:Supply Chains and Spares
Author:Blazer, Douglas J.; Parrish, Woodrow A.
Publication:Air Force Journal of Logistics
Geographic Code:1USA
Date:Sep 22, 2011
Words:4101
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