by Ron Mullan
72nd Air Base Wing Public Affairs
7/31/2015 - TINKER AIR FORCE BASE, Okla. -- In
an effort to provide better support to the warfighter and generate both
cost-effective readiness and combat power for America, the 448th Supply
Chain Management Wing developed, base-lined and implemented a method of
measuring the demand on the supply chain system, called Demand Forecast
Accuracy, for the first time in 2008.
"DFA is a measure of how well demand on the supply chain is predicted
relative to the actual demand that is generated," said Belinda Slavick,
948th SCMG director. "DFA is expressed as a percentage of actual demand
that was correctly forecast."
Today, demand forecasts are generated by the 448th SCMW's equipment
specialists who maintain application records and calculate replacement
rates and factors using the D200 Requirements Computation System. The
448th SCMW's Demand Planning team and equipment specialists have been
implementing annual and quarterly DFA improvement initiatives that have
garnered significant and steady improvements since its inception.
The 948th Supply Chain Management Group began dollarizing the impact
that improvements in DFA had on its budget submissions in 2012 in order
to capture savings under the Logistics & Installations Efficiency
initiative. Dollarizing DFA improvements is complicated, said Slavick.
It includes annualizing the demand quantities plus lead-time and
multiplying demand quantities by either buy or repair costs depending on
computed deficits in the requirements computation.
"Basically, we are calculating the cost of buys and repairs we would
have budgeted for if we hadn't made improvements to our forecast and
comparing the results to budget submissions with the improved
forecasts," Slavick said. Dollarizing 2010 through 2013 improvements to
DFA resulted in net budgetary reduction of $125 million.
"We transitioned to an Office of the Secretary of Defense developed
standard dollar-demand weighted formula demand in 2014," said Slavick.
"It provides additional emphasis on high dollar and high demand item
Improvements to DFA resulted in $191 million in savings to the spares budget in 2014.
With the demand planners in the 448th SCMW continued emphasis on
accurate forecasting using today's systems, methods, and improvement
initiatives, they are also looking to the future.
"We are participating in the AF analysis of PEAK and NextGen, processes
which offer new ways to forecast for items with low demand and highly
variable demand patterns, as well as implementation of an Advanced
Planning System," Slavick said.
An APS is a state of the art requirements determination system for
demand, supply and inventory planning. It is more robust and more
responsive then the current Air Force legacy requirements determination
systems. According to Slavick, the current system uses eight-quarter
moving average, four quarter moving average or exponential smoothing and
is limited to quarterly requirement computation capability. The APSs of
today offer multiple algorithms to choose from and can generate
requirements computations as often as daily.
Great systems and methods are only as good as the people who use them.
"The dedicated demand planning professionals of the 448th SCMW continue
to achieve remarkable improvements in Demand Forecasting year after
year," Slavick said. "They have made the 'Art of the Possible' a reality
across the Air Force supply chain."
Despite unprecedented times of culture change, operational tempo and
fiscal constraints, the demand planners of the 448th SCMW have achieved
steady success culminating in a current wing DFA of 65 percent. The rest
of the Air Force is at 62.9 percent, which is significantly higher than
any of the other DOD services. In addition, the unit has contributed
$316 million to the Air Force Sustainment Center's Road to $1 billion to