TOBYHANNA ARMY DEPOT, Pa. -- A simple click of a computer mouse is helping personnel here eliminate excess inventory, saving millions in storage and maintenance fees over the next three years.
Tia Martini and a team of six subject matter experts recently completed a Lean Green Belt Project to restore balance in maintaining sufficient quantities of repair parts and raw materials to support production without stockpiling material beyond current and planned needs.
Lean is a quality improvement and business strategy that emphasizes reducing defects, process cycle times and costs. A Green Belt employee leads or supports improvement projects.
"Although we looked at this project as a tactical approach to reducing excess inventory, it is really part of a larger strategic plan of minimizing our inventory levels, resulting in reduced expensing rates and ultimately establishing Tobyhanna as the preferred Command, Control, Communications, Computers, Intelligence, Surveillance and Reconnaissance (C4ISR) provider," said Patrick Esposito, Production Management Directorate director and Green Belt sponsor.
Martini pointed out that excess inventory ties up funds which could be used for other purposes. She said the team looked at several things to determine why the depot wasn't using what it was buying. The supply systems analyst works in the PM Directorate's Material Management Division.
As it turns out the primary root cause of the depot's excess inventory was an unchecked open materials reservations box located in Logistics Modernization Program (LMP).
"We realized the master data in LMP and the signals that we gave the system were really impacting excess inventory," said Martini. "Tobyhanna is in the midst of a huge culture change where cost must be the business focus alongside providing value to the customer."
The value of Tobyhanna's excess inventory has dropped $3.3 million [from $16.8 million] since the Green Belt project started two years ago. Open material reservations have been reduced by more than $5 million.
"It's a one-time requirement to set the open materials reservation default," said Heather Yoder, Materiel Accountability and Analysis Branch chief. "Clearing the open reservation lets LMP know you have all you need, to stop requisitioning the materials, and gives a clearer picture of what's actually in the pipeline that can be used on future requirements."
Excess inventory data analyst Joseph Masi was tasked with identifying situations where employees procured more material than needed, determining the reason and making recommendations to prevent it from happening in the future. He explained that if 200 items were purchased, but only 100 were needed, then there's something wrong in the planning process. The goal is to look for opportunities to reduce the variance between what is planned and what was actually used. To procure no more or no less than what is needed, he said.
"This project was critical to ensure the competitiveness of the depot," said Michael Henry, Materiel Management Division chief. "The team did an outstanding job digging into the details of the excess material issue and found several root causes -- the biggest being closing out open material reservations, which will save the depot millions."
Henry explained that paying closer attention to items purchased to support depot workload can improve the overall supply chain and help the depot to meet customer expectations and schedules. The cost to buy, store, manage and dispose of excess material drives up the rates charged to our customers, he added. Instead of stretching resources to the limit, Henry suggested that personnel buy only what is really needed.
While Martini identified things that met established criteria for excess material, Christopher Tarrant and Anthony Portanova looked for errors and oddities.
"I would check to see if there were any open transfer orders, demand or notes showing in LMP that would make us think twice about excessing the material," Tarrant said, adding that he was able to work with expeditors to resolve issues of categorizing items for proper disposition.
Portanova noted that getting to the root of the problem, in some cases several years old, proved to be quite a challenge. In the end, creating and fixing these processes will help the depot to reduce waste and remain competitive.
"This project will have a profound impact on Tobyhanna's bottom line," he said. "It's vital we find ways to maximize the customer's dollar, ensuring the warfighter gets the best value."
Supply Technician Tina Lynott said throughout the Green Belt process, problem areas were identified and processes were created to correct those issues. Lynott works in the Material Accountability and Analysis Branch.
Her work brought to light problems with over shipment of materials and personnel procuring items using non-traditional methods, such as with a government credit card to expedite work even though the same items were already on order. Minimum buy restrictions and unit-of-measure issues with vendors also created problems, Lynott added.
"It was great being on this project and playing a key role in helping identify excess inventory conditions," said Richard Cook, System Data Analyst in the Enterprise Resource Planning Division. "It was a challenge to uncover the details due to the size of the inventory and in some cases the length of time that had passed."
Martini praised her team for their hard work and ultimate success of the Green Belt project.
"Personnel need to make the necessary changes to improve the overall health of the organization," she said. "It's really about having integrity with the data in the system and maintaining that integrity. Stay vigilant and understand that what you do impacts everyone else. Look for what's good for the depot."
Tobyhanna Army Depot is a recognized leader in providing world-class logistics support for C4ISR Systems across the Department of Defense. Tobyhanna's Corporate Philosophy, dedicated work force and electronics expertise ensure the depot is the Joint C4ISR provider of choice for all branches of the Armed Forces and industry partners.
Tobyhanna's unparalleled capabilities include full-spectrum support for sustainment, overhaul and repair, fabrication and manufacturing, engineering design and development, systems integration, technology insertion, modification, and global field support to warfighters.
About 3,100 personnel are employed at Tobyhanna, which is located in the Pocono Mountains of northeastern Pennsylvania. Tobyhanna Army Depot is part of the U.S. Army Communications-Electronics Command. Headquartered at Aberdeen Proving Ground, Md., the command's mission is to research, develop, acquire, field and sustain communications, command, control computer, intelligence, electronic warfare and sensors capabilities for the Armed Forces.
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