One such area  is inventory management. We have reported that in  order to successfully resolve supply chain management problems, DOD  needs to sustain top leadership commitment and long-term institutional  support for its strategic planning efforts for supply chain management,  obtain necessary commitments for its initiatives from the military services  and other DOD components, make substantial progress in implementing  improvement initiatives and programs across the department, and  demonstrate progress in achieving the objectives identified in supply chain  management-related strategic planning documents. In addition, successful resolution of weaknesses in supply chain  management depends on improvements in some of DOD’s other high-risk  areas. DOD’s new Logistics Strategic Plan is intended to support other recent  strategic planning efforts in the department, including the completion of  the 2010 Quadrennial Defense Review and the publication of the 2009  Strategic Management Plan. Our prior work has shown that strategic planning is the foundation for  defining what the agency seeks to accomplish, identifying the strategies it  will use to achieve desired results, and then determining how well it  succeeds in reaching results-oriented goals and achieving objectives. DOD Has Issued Prior Strategic Plans on Logistics and Supply Chain Management

Over a number of years prior to the publication of its Logistics Strategic  Plan, DOD issued a series of strategic planning documents for logistics  and the management of its supply chain. For example, for a period of several  years beginning in the mid-1990s, DOD issued a series of strategic plans  for logistics. Building on the “as is” Focused Logistics Roadmap, DOD recognized the  need for a comprehensive, integrated strategy for transforming logistics  and released its Logistics Roadmap in July 2008 to provide a more  coherent and authoritative framework for logistics improvement efforts,  including supply chain management. The roadmap documented numerous initiatives and programs that were  then under way and organized these around goals, joint capabilities, and  objectives. First, it did not  identify the scope of DOD’s logistics problems or gaps in logistics  capabilities. Third, DOD had not clearly stated how it intended to  integrate the roadmap into DOD’s logistics decision-making processes or  who within the department was responsible for this integration. DOD’s 2010 Logistics Strategic Plan Provides High-Level Strategic Direction

The 2010 Logistics Strategic Plan is DOD’s most recent effort to provide  high-level strategic direction for future logistics improvement efforts,  including those in the area of supply chain management. The Logistics Strategic Plan reiterates high-level department goals drawn  from both the Quadrennial Defense Review and the Strategic  Management Plan. In our review of the plan, we  noted that key initiatives appear to focus on issues that we have identified  as needing management attention. DOD identifies four success indicators  and three performance measures for this goal. Logistics Strategic Plan Lacks Specificity Regarding Strategies and Time Frames

		Plan Lacks Detailed Information in Several Areas

Although the Logistics Strategic Plan contains some key elements of an  effective strategic plan and provides unifying themes for improvement  efforts, it lacks detailed information regarding strategies and time frames  that would help to specify how and when goals will be achieved. While the plan presents  three performance measures associated with Goal 4, it lacks baseline  or trend data for past performance, measurable target-level  information, or time frames for the achievement of goals or completion  of initiatives. Key concepts. Problems and capability gaps. Resource needs. It is not clear how the Logistics Strategic Plan will be used within the  existing logistics governance framework to assist decision makers and  influence resource decisions and priorities. In conclusion, strategic plans need to remain at a high enough level to  provide a clear vision and direction for improvement, but without more  specific information in the Logistics Strategic Plan, it will be difficult for  DOD to demonstrate progress in addressing supply chain management  problems and provide Congress with assurance that the DOD supply chain  is fulfilling the department’s goal of providing cost-effective joint logistics  support for the warfighter.
Why GAO Did This Study

The Department of Defense's (DOD) management of its supply chain network is critical to supporting military forces in Iraq, Afghanistan, and elsewhere and also represents a substantial investment of resources. As a result of weaknesses in DOD's management of supply inventories and responsiveness to warfighter requirements, supply chain management is on GAO's list of high-risk federal government programs and operations. In July 2010, DOD issued a new Logistics Strategic Plan that represents the department's current vision and direction for supply chain management and other logistics areas. Today's testimony draws from GAO's prior related work and observations from an ongoing review of DOD supply chain management, and, as requested, will (1) describe DOD's prior strategic planning efforts in the area of logistics, (2) highlight key elements in the new Logistics Strategic Plan, and (3) discuss opportunities for improvement in future iterations of this plan. In conducting its ongoing audit work, GAO reviewed the Logistics Strategic Plan, compared elements in the plan with effective strategic planning practices, and met with cognizant officials from DOD, the military services, and other DOD components as appropriate.

What GAO Found

Prior to the publication of its new Logistics Strategic Plan, DOD issued a series of strategic planning documents for logistics over a period of several years. In 2008, DOD released its Logistics Roadmap to provide a more coherent and authoritative framework for logistics improvement efforts, including supply chain management. While the roadmap discussed numerous ongoing initiatives and programs that were organized around goals and joint capabilities, it fell short of providing a comprehensive, integrated strategy for logistics. GAO found, for example, that the roadmap did not identify gaps in logistics capabilities and that DOD had not clearly stated how the roadmap was integrated into DOD's logistics decision-making processes. GAO's prior work has shown that strategic planning is the foundation for defining what an agency seeks to accomplish, identifying the strategies it will use to achieve desired results, and then determining how well it succeeds in reaching results-oriented goals and achieving objectives. DOD said that it would remedy some of the weaknesses GAO identified in the roadmap. The July 2010 Logistics Strategic Plan, which updates the roadmap, is DOD's most recent effort to provide high-level strategic direction for future logistics improvement efforts, including those in the area of supply chain management. The plan provides unifying themes for improvement efforts, for example, by including a logistics mission statement and vision for the department, and it presents four goals for improvement efforts with supporting success indicators, key initiatives, and general performance measures. One goal focuses specifically on supply chain processes. The plan is aligned to and reiterates high-level departmentwide goals drawn from both the 2010 Quadrennial Defense Review and the 2009 Strategic Management Plan for business operations. Key initiatives in the plan appear to focus on issues that GAO has identified as needing management attention. While the Logistics Strategic Plan contains some of the elements necessary for strategic planning, it lacks some detailed information that would benefit decision makers and guide DOD's logistics and supply chain improvement efforts. The plan lacks specific and clear performance measurement information (such as baseline or trend data for past performance, measurable target-level information, or time frames for the achievement of goals or completion of initiatives), definition of key concepts, identification of problems and capability gaps, and discussion of resources needed to achieve goals. Further, linkages to other plans and some key related activities under way within logistics are unclear, and it is similarly unclear how the plan will be used within the existing governance framework for logistics. Without more specific information in the Logistics Strategic Plan, it will be difficult for DOD to demonstrate progress in addressing supply chain management problems and provide Congress with assurance that the DOD supply chain is fulfilling the department's goal of providing cost-effective joint logistics support for the warfighter.