In accordance with the USD(AT&L) Better Buying Power (BBP) 2.0 Implementing Directive of April 24, 2013, the Acting ASD(L&MR) has issued a new memo dated November 22, 2013 entitled “Performance Based Logistics Comprehensive Guidance." According to the memo, “this comprehensive guidance is provided to assist the Services in adopting and expanding Performance Based Logistics (PBL) for all weapon system programs. This memorandum expands on BBP 2.0 guidance to assist the Services with increasing effective use of PBL.”

A few highlights:

·         Reiterates existing DoD policy contained in DoDI 5000.02 Enclosure 2 (Para 8.c.(1)(d) (page 29)), stating that “PBL is synonymous with performance based product support, where outcomes are acquired through performance based arrangements that deliver Warfighter requirements and incentivize product support providers to reduce costs through innovation.”

·         Emphasizes that PBL “arrangements are contracts with industry or inter-governmental agreements”, reiterating that PBL is neither outsourcing nor contractor logistics support (CLS). See also October 2009 article “What Performance Based Logistics Is And What It Is Not—And What It Can And Cannot Do”, the November 2009 DoD Weapon System Acquisition Reform: Product Support Assessment, and an earlier August 2013 CLS, ICS and PBL - A Study in Contrasts blog post.

·         Memo identifies a series of “attributes of effective PBL arrangements” as well as providing examples of what PBL arrangements do not incentivize.

·         Memo identifies circumstances when PBL arrangements should be considered and when they may not in fact be appropriate

·         Memo makes clear that “effective PBL arrangements involve more than the expertise and authority of the Life Cycle Logistics functional area.  In addition to Life Cycle Logistics, the essential functional areas that programs must engage as they develop, negotiate, deploy, and manage PBL arrangements include Program Management, Contracting, Engineering, Business – Cost Estimating, and Business – Financial Management”

·         Emphasizes that although the term PBL includes the word “logistics” does not mean PBL is exclusively the purview or solely the responsibility of the Life Cycle Logistician (or the Product Support Manager), stating “Component Acquisition Executives (CAEs), Program Executive Officers (PEOs), and Program Managers (PMs) play key roles in improving the use of PBL arrangements through their communication with the acquisition workforce.”

This memo contains detailed guidance including:

·         “CAEs, PEOs, and PMs will emphasize through appropriate communication vehicles the importance of pursuing performance based product support strategies and the beneficial role of PBL arrangements. This communication must draw on the PBL definition listed in this memorandum to promote a common understanding among the acquisition workforce and industry.”

·         “Components will continue to provide sustainment quad charts for Defense Acquisition Board (DAB) and Defense Acquisition Executive Summary (DAES) reviews per Under Secretary of Defense for Acquisition, Technology, and Logistics (USD(AT&L)) memorandum, “Strengthening Sustainment Governance for Acquisition Program Reviews" dated April 5, 2010 and ensure that PMs (Program Managers) list specific PBL arrangements, if appropriate, in the product support strategy section of the chart.”

·         “During (these) reviews, PMs should discuss the incentives in the arrangement used to achieve the sustainment requirements and operating and support costs.  CAEs should encourage similar discussion during Component reviews for programs below ACAT ID.”

·         “CAEs and Logistics and Materiel Readiness (L&MR) will review Departmental policy causing barriers (both intended and unintended) to adopting PBL arrangements and take steps to mitigate these barriers or revise policy, as appropriate.  If there are constraints to using PBL arrangements when compared to other product support arrangements, the rationale should be determined and corrected where warranted.”

·         “CAEs and the Defense Acquisition University (DAU) will continue to support L&MR efforts to develop and maintain a PBL Best Practices Guidebook. The guidebook provides process guidance, tools, and guiding tenets to assist programs in structuring effective PBL arrangements” (Note: the guidebook, when issued in early 2014, will be posted on both the PBL Community of Practice Policy & Guidance page and the Logistics Community of Practice (LOG CoP) Product Support Key References website).

·         “Components should include metrics-based assessments of PBL arrangements as part of program sustainment reviews (National Defense Authorization Act for Fiscal Year 2012, Section 832(10)). These assessments should measure the adequacy of PBL arrangements in achieving sustainment requirements and cost goals.”

·         “The Functional Lead for the Life Cycle Logistics Functional Integrated Product Team (FIPT) will coordinate with the Functional Leads for the other career fields listed (Program Management, Contracting, Engineering, Business – Cost Estimating, and Business – Financial Management) and the Component Defense Acquisition Career Managers to assess gaps in competencies essential to PBL arrangement development.  The Functional Leads will use the results of this assessment to inform changes to workforce training and DAU learning assets.”

·         “DAU will maintain a PBL Community of Practice (CoP) to provide a repository of lessons learned from material generated during PBL implementations across the Department.” (Note: The PBL CoP is available at https://acc.dau.mil/pbl).

·         “CAEs should encourage members of these career fields (Life Cycle Logistics, Program Management, Contracting, Engineering, Business – Cost Estimating, and Business – Financial Management) to pursue PBL training through DAU as part of their continuing education requirements.  Hands-on experience in structuring and executing PBL arrangements should complement training to instill proficiency among the cadre of PBL professionals.”

·         “CAEs will provide a summary of their PBL implementation efforts to the Business Senior Integration Group (B-SIG) on an annual basis. They should consider including the current use of PBL arrangements, achieved savings, lessons learned and future opportunities.”

For those who have not taken them yet -- or want to get ahead of the curve in the area of professional development – a few of the existing DAU learning assets include:

·          LOG 235 Performance-Based Logistics distance learning course

·          LOG 340 Life Cycle Product Support classroom course

·          CLL 011 Performance Based Life Cycle Product Support continuous learning module

·          Performance Based Logistics Community of Practice (PBL CoP)

·          Product Support Manager (PSM) Toolkit

In addition, new DAU learning assets planned for development include incorporation of updated PBL materials into several other non-logistics courses, development of a new CLL 031 PBL Contracting Strategies continuous learning module, and development of new web-based Performance Learning Tools (PLTs).