04/14/08 PERU July 2009. 04/14/08 Customer Tools for Effective Case Management SAM-I, 5/1/09.

04/14/08

PERUJuly 2009

04/14/08

Customer Tools for

Effective Case Management

Customer Tools for


SAM-I, 5/1/09

04/14/08

Customer Tools for Effective Case Management

LOR & Customer Participation in the Process

FMS Transparency FMS Reviews Financial Management Reviews Customer Advocate Groups Personal Contacts-Communicate! Staying Informed

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Total PackageApproach

Letter of Request Checklist Support Equipment Facilities Follow on Support Publications

Services FMS Case Reviews Training DOD/Contractor Services Site Survey

Financial Considerations Funding Source Payment Schedule/Initial

deposit Financial Waivers

Special Considerations Memorandum of

Understanding (MOU) Offsets Commercial Negotiations Special Reports Interoperability

Identification Information Purpose:

P&A- Price & Availability LOA-Letter of Offer &

Acceptance Lease Purchaser Pre-negotiations Transparency Acceptance Time Frame International Solicitation

Major Item Considerations Standard Model Quantity Unique Configuration Delivery Timeframe Transportation Warranties Sole Source

Support Considerations Operations Concept Maintenance Concept Supply Concept Initial Spares

LORMODULE

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Need LOR preparation help?

DISAM’s LOR Writing Guide USASAC’S Commodity Specific

Checklists (Int’l Customers tab) AFSAC On-line Implementing Agency (IA)- Country

Program Director (CPD)

USASAC-U.S. Army Security Assistance CenterAFSAC-Air Force Security Assistance Center

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Total PackageApproach

Letter of Request Checklist Support Equipment Facilities Follow on Support Publications

Services FMS Case Reviews Training DOD/Contractor Services Site Survey

Financial Considerations Funding Source Payment Schedule/Initial

deposit Financial Waivers

Special Considerations Memorandum of

Understanding (MOU) Offsets Commercial Negotiations Special Reports Interoperability

Identification Information Purpose:

P&A- Price & Availability LOA-Letter of Offer &

Acceptance Lease Purchaser Pre-negotiations Transparency Acceptance Time Frame International Solicitation

Major Item Considerations Standard Model Quantity Unique Configuration Delivery Timeframe Transportation Warranties Sole Source

Support Considerations Operations Concept Maintenance Concept Supply Concept Initial Spares

DISAMLOR Preparation Guide

Customer Budget Limitations ???

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Typical DOD System Life-Cycle Cost

Life-Cycle Cost

Operation and Support

System Acquisition

Production

System Research and Development

0 I II IIIMilestones

10%10%

30%30%

60%60%

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AT&L Knowledge Sharing System

https://a

kss.dau.mil/D

efault.aspx

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Transparency in the FMS Process?

LOA in Development LOA Estimated Line Item Costs LOA Line Item Services LOA Contracting Process

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Purchaser Participation in the LOA Preparation Process

SAMM C5.4.6.2 Purchaser involvement early on in the LOA development

process is essential to ensure the final document provides the best “fit” for their requirements.

Purchasers should be encouraged to attend meetings and receive correspondence designed to clarify LOR information.

As the development of the LOA progresses, there are many instances where purchaser participation and input are necessary.

Any unique notes or conditions being considered may be provided to the purchaser for advance review to ensure these special case and/or program-unique needs are addressed

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LOA Estimated Line Item CostsDSAMS Report # 69

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Standard Level of Service

“Standard Level of Service” - What it is

Administrative Surcharge-funded activities necessary to write, implement, manage, execute, oversee, and close a Foreign Military Sales (FMS) or FMS-like case

An amount of effort estimated up-front and well-documented in the case - with changes made as the program changes/warrants

“Standard Level of Service” - What it is not

It is not the same number of reviews, reports, managers, etc. for every FMS or FMS-like case that is implemented

It is not the same amount of effort expended on each FMS or FMS-like case that is implemented

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#Core

Function(s)Program

Element(s)Functions/Activities

FMS Admin (Standard Level of

Service)FMS Case

7 Case Development

10 Development of an LOA that is “classified” at the request of the purchaser.

If work to prepare this “classified” LOA is expected to exceed 1/4 work-year or $25,000 (whichever is greater), a services line on the “classified” case must be used to cover costs incurred or expected to be incurred with preparation and handling outside the DSAMS document preparation capabilities.

8 Case Development

10 Processing case-related waivers to USG policies and procedures (e.g., nonrecurring cost waivers)

X

9 Case Development

8 Determine releasability and disclosure decisions for requested articles and services

Releasability and disclosure activities are not funded by FMS Admin or the FMS case. These activities are funded using Implementing Agency O&M funds.

16 Case Execution

13, 14, 15, 16

Preparation of reports as requested by the purchaser that are either (1) more detailed reporting than covered under #12; and/or (2) more frequent reporting

Incremental costs above the Standard Level of Support provided in #12.

Funding Source(Total Value for services, includes per diem, salary, travel)

Identifies thresholds for when specific work must be case-funded

Eliminates use of Program Management Lines

Identifies O&M-funded activities that CANNOT be funded by either FMS Admin or FMS Case

Requires “incremental” costing for certain activities that exceed the “Standard Level of Service”

1 2

3

4

SAMM Table C5.T6. - Manpower Matrix

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Manpower & Travel Data Sheet(MTDS) SAMM C9.F1

LOA service lines require justification to DSCA as part of the counter signature process

MTDS correlates services to the manpower matrix in SAMM C5.T6

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LOA Manpower ServicesManpower Travel Data Worksheet- MTDS

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Customer In Contract ProcessDFARS 225.7304, SAMM C.6.3

FMS Customer may: Request sole source prime and subcontractors Propose additional sources but cannot eliminate

and specific source

At contracting officer discretion, customer can participate in discussions with industry on: Technical Specifications Delivery Schedules Price/Performance Tradeoffs Other Requirements Unique to FMS Purchaser

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Security Assistance Reviews

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Security Assistance Reviews Bilats- Bi-lateral discussions SAWG-Security Assistance Working Group SAR-Security Assistance Review PMR- Program Management Review FMR-Financial Management Review CMR-Country Management Review SAMR-Security Assistance Management

Review LMR-Logistics Management Review

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FMS REVIEW POLICY TENETSDSCA 00-19, 02-48 & SAMM C6.5

Review Agenda Topics Program/Delivery Status Case Closure Contract Status Discrepancy Status Billing Issues Previous Review Action Items Financial Status

Commitment, obligations, expenditures Payment Schedules Unprogrammed funds

Current Issues

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FMS REVIEW POLICY TENETSDSCA 00-19, 02-48 & SAMM C6.5

Planning for a Review!

Specify types of review and appropriate scope of each. (Policy/Country/Service/Program/Internal reviews)

Each review must add value & have clear objectives and deliverables

Identify review objectives & goals and attendees Country, SAO, Contractor, DFAS, DSCA, MILDEP

Specify USG review attendee responsibilities: have distinct and active role be fully prepared be knowledgeable be empowered to make on-the-spot decisions

• Reduce the number of reviews Usually yearly, Must be case funded if more then one a year PMR’s require mandatory LOA note & schedule

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DSCA Financial Management Review Program (FMR)

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Financial Management Reviews (FMRs)

SAMM C9.14

Chaired by DSCA Tri-Service/MND level Objective: Review current and forecasted posture of purchasers

FMS program. Reconcile financial records. Review case financial records. Identify

cases for intensive financial management. SAMM Table C9.F7- provides mandatory format for a FMR preparation

Format: Executive Session -- general financial issues, macro FMS program

financial status, FMS reinvention, updated policies, readout of current financial topics

Case-Level Session -- review of open FMS cases Side Meetings -focus on logistical, programmatic, operational issues.

Duration: usually, one week Frequency: As required Location: usually alternates between DSCA and host country

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FPG-Foreign Procurement Group ICUG-Int’l Customers Users

GroupDefense MOU Attachés Group

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Foreign Procurement Group Charter

1. The Foreign Procurement Group (FPG)-The customer focal point, recognized by the DOD FMS community, as part of the Deputy Secretary of Defense's initiative for FMS re-engineering.

The FMS customer focal point to consider DOD proposals for changes in FMS arrangements and procedures.

It will additionally consider and propose to DOD other changes to FMS considered of benefit to the customer community

Countries participating in the FPG will be free to pursue, separately with the DOD

2. The FPG will hold meeting about once a month with DSCA and other key S.A. organizations.

3. Membership will be open to all members of the MOU Attachés Group, and to other countries as may be agreed by existing members of the FPG. Representatives will be knowledgeable and experienced FMS practitioners able to contribute to the FPG's deliberations and conclusions from their national view point and in pursuit of improvements of general benefit.

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-Transparency in FMS Charges/Standard Level of Service

-Other Admin Surcharge charges-Transparency in Delivery listing-Transportation-FMS as a commercial alternative/quantify and define the value added of FMS

-Annual Authorizations/Blanket Approvals-Country Specific cost and schedule performance measures-Payment Schedules-Commercial Accounts-Access to Contracting Documentation-Processing Times

FPG Top 10 Priorities

FPG priority details and

meeting minutes are

on the SCIP “Partner

Info” tab

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FPG Member Nations Argentina Australia Austria Belgium Brazil Canada Chile Denmark Egypt Finland France Germany Greece Indonesia Israel Italy

Japan Korea Netherlands New Zealand Norway Pakistan Poland Portugal Singapore Spain Sweden Switzerland Taiwan Turkey UK Yemen

May 2009

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FPG Points of Contact

Chairman – Dr Jennifer Stewart (Canada)

Secretary – SQNLDR Stephen Hall

[email protected]

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International Customer User Group (ICUG)

Comprised of customer ILCO representatives Primary responsibilities:

Enhance the FMS logistical process Provide unified customer position FMS issues and

computer systems development/ enhancements Receive & disseminate automation information

Meets on a quarterly basis; at least one joint annual meeting with the FPG

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International Customer User Group (ICUG) Priorities

Develop tri-service solution for SCIP access to EMALL & EFTS

Integration Issues with SCES

Develop formal list of ICUG objectives

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INTERNATIONAL CUSTOMER USER GROUP (ICUG)

Mr. Larry GlascoDLA J3/J4 Director of Logistics Operations and Readiness8725 John J. Kingman RoadFort Belvoir, Virginia 22060-6221

July 09, 2008

ICUG - FREIGHT INSPECTION AND TRANSPORT CONCERNS

Sir,

The International Customer Users Group (ICUG) exists to enhance the relationship and communication between DLA, Defense Security Cooperation Agency (DSCA) and the Foreign Military communities from all three International Logistics Control Offices (LCO’s). The membership, representing 33 countries, meets on a quarterly basis to review and discuss ongoing issues and initiatives affecting Foreign Military Sales (FMS) logistics processes. The ICUG members provide liaison with DSCA, the FMS Management Information Systems (MIS) Program Managers and their contractor support staff on behalf of their fellow ILCO customer representatives and in-country counterparts. The primary responsibility of ICUG members is to receive and disseminate MIS and logistics-related information and provide appropriate feedback to DSCA .

During our meeting of 3-4 June 2008, ICUG members expressed concerns over a recent DLA policy to delay items destined to foreign customers, in order for DLA to effect secondary inspections on outgoing shipments. This policy is causing significant delays on high priority (MICAP/NMCS and Priority 3) demands being shipped to our soldiers (many serving in-theatre on the Global War on Terrorism (GWOT)). While we understand the necessity for oversight, the lack of an announced policy is causing consternation with regards to how long this policy will be in place.

The question being submitted from the ICUG Membership is: Would it be possible for the Foreign Military Customer to be made formally aware of the new DLA policy which implemented a secondary inspection regime, and how long will this policy be in place? Secondly, is there any defined metric outlining the new shipment timelines so that we may better advise our countries on whether or not FMS requisitioning through DLA remains a viable option on high priority requisitions (versus direct commercial). Lastly, would it be possible to provide information on the inspection timeframe and metrics to show the progress for the MICAP/NMCS and high priorities?

Your review and consideration of this request for clarification is greatly appreciated by the ICUG Membership.

Regards,

Major Chris Dann (Canadian Liaison Officer)Chairperson - International Customer User Group700 Robbins Avenue, Philadelphia, PA 19111

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Personal Contacts-

Networking & Communication

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Personal Contacts Know who they are & where they are:

SAFR/FLO Country Representative at Systems Command SCO/ODC/OMC Case Manager US Country Program Director (CPD)

Know their roles and responsibilities, know what they can do for you-or not

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Communicate Effectively Messages & Info. Addresses Information Overload-be concise Subject Line

Talk to DSCA (when necessary!) CPD or CFD

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Continual Improvement-the customer is part of that

process!DSCA Strategic Plan Goal #4*

*Ref: DSCA Strategic Plan 2006-2011 dtd 13 Feb 2006

DEPSECDEF Guidance directs “how” – CPI through Lean Six Sigma

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Tell DSCA what your thinking!!!!

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Communicate your Ideas to DSCA !

Establish a Continuous Process Improvement (CPI) capability at DSCA using Lean Six Sigma (LSS) methodology Leverage the improvement efforts underway within DSCA and

across DoD – phased accelerated deployment Replicate best practices and project work from MILDEP LSS

implementations

Synchronize with OSD CPI / LSS requirements and DoD Performance Plan

Identify strategic performance gaps (e.g. FMS cold war process vs. GWOT requirements) across functions, organizations, and command structures and recommend solutions to close the gap

This isn’t the next “thing” – it will help change our culture and the way we work

DSCA Director Guidance

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Read, Web Surf & Keep Informed Know current policy and procedures Know key web sites

DSCA, DISAM, ETC

Know how to do web searches!

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DISAM/DSCA Web Site Resources

http://www.disam.dsca.mil/ http://www.dsca.mil/

Ask an Instru

ctor

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DISAM MET???

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Customer Tools for


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OPTIONAL SLIDES

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Role of Policy Coordination Office

Coordinate decisions within purchaser’s government

Central point of contact for American organizations

Nucleus of expertise about American programs

Liaison between other government agencies and U.S. offices

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Logistics Management Skills

Maintain a system to track requisitions and material deliveries.

Follow-up on old requisitions

Respond to shipment status notifications

Prepare requisitions in the Military Standard Requisitioning and Issue Procedures (MILSTRIP) format for FMS blanket order and CLSSA cases

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Logistics Management Skills

Select a freight forwarder and manage its performance

Keep the Military Assistance Program Address Directory (MAPAD) current

Prepare Supply Discrepancy Reports (SDRs) when necessary

Monitor the end-use of U.S.-provided defense items. Obtain U.S. approval prior to transferring items to other countries

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Education and TrainingAdministration Skills

Identify education and training needs

Identify and screen candidate students Ensure students meet English Language Training (ELT) and other (e.g., human rights) criteria for selected U.S. courses

Oversee the proper use of in-country English language laboratories

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Education and TrainingAdministration Skills

Manage budgets for FMS education and training programs

Use the Internet-based International Security Assistance Network (I-SAN) to manage country’s training program

In conjunction with SAO’s Training Management System (TMS) that tracks FMS and IMET training

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Location of Policy Coordination Office

Depends on desires of purchasing government

Since involves purchase of weapon system, may be in acquisition directorate of Ministry of Defense

May also be in planning and programming directorate of Ministry

Could be in U.S. at embassy or liaison office

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62

Priorities of the Foreign

Procurement Group

February 2009

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63

FPG Top 10 Priorities

1. Transparency in FMS charging/Standard Level of Service

2. Transparency in delivery listings

3. Other Administrative Surcharge changes

4. Processing times

5. Third party transfers

DSCA/MILDEPs

DSCA/MILDEPs

DSCA DSCA/MILDEPs/FPG Metrics

WG State

Stakeholders Priority

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1. Transparency and Standard Level of

Service An objective of the Administrative Surcharge

changes has been increased transparency This builds on past initiatives (e.g., increased

customer participation in LOA preparation) The implementation of the new policy on

Standard Level of Service (SLS), including the replacement of hidden program management lines with well-defined LOA lines, goes a long way towards meeting this objective

Increased visibility is leading to savings – some customers are already seeing differences in the bottom-line of certain cases

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1. Transparency and SLS (cont’d)

However, the application of SLS has raised new issues which need to be resolved

Chief among these is the need for greater clarity and consistency among the MILDEPs in terms of what activities are covered under SLS and what are “incremental” costs – to be customer funded

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1. Transparency and SLS (cont’d)

Other issues to be resolved include: Incidences of “double billing” – i.e., charging

customers for services that should be covered under SLS

Examples of countries being denied information Complaints from staff in the MILDEPS that they

are not receiving Admin funding for SLS activities Perception that the SLS is being eroded (e.g.,

cancellation of Navy CRRs)

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2. Transparency in delivery listings

Need to relate invoiced amount to delivered items/services in current delivery listings

Currently not the case: One line in the delivery listing may include a number of

different services rendered Can easily take 6 to 9 months before a delivery gets

invoiced on the delivery listing Impossible to verify charges made on an FMS case

against received deliveries and ensure financial control

Requisite information is available in the various US systems; this information needs to be made available to the customer

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3. Other Administrative Surcharge initiatives

Small Case Management Line Fee should be waived when USG says

“no” to a country’s proposed consolidation

Case writing consolidation Concerns that this consolidation has led

to increased processing times appear unfounded and will be addressed under Priority # 4

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4. Processing times Except for OIF and OEF requirements and requirements

from smaller agencies (NGA, NSA), the target of 120 days from LOR to LOA 80% of the time is often not being met

Important to have a reliable estimate to manage expectations of our capitals - but the solution should not be a longer timeframe

Recognize work underway throughout the community in general, and in the Security Cooperation Business Forum in particular, to examine LOA milestones and identify causes of delays; Metrics Working Group developing recommendations on how the customer can help reduce these delays

Need a plan and timeframe from DSCA for resolution

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• Reality of outsourcing needs to be better addressed in FMS agreements

Existing FMS case terms provide rights to transfer and use intellectual property and materiel to customer government and/or its agents

Agents are freight forwarders only. Contractors are not considered as agents

Given increased reliance on outsourcing – government employees working with a contingent workforce of contractors – the FPG has been advocating since 2004 to change the FMS definition of agent to include licensed, in-country contractors

5. Third Party Transfers

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5. Third party transfers (cont’d)

In May 2007, The Department of State (Dave Quinn of PM-RSAT) briefed the FPG on his proposed initiative underway to modify the definition of agent Developed in consultation with an FPG working group FPG strongly supported

Proposal has since been under “final” review by DOS Legal Counsel (but taking an “infinite” time)

Need DSCA support and State attention to finalize and implement

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6.1. FMS as a commercial alternative

Major issue = how to level playing field so an FMS proposal can compete with a direct commercial sales proposal

How to provide for firm delivery dates, fixed prices and performance guarantees, when required by a country's competitive procurement regime

These are not included in the FMS framework

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6.1. FMS as a commercial alternative (cont’d) Past solutions involve approval for a

waiver or a hybrid (part DCS, part FMS), where the contractor "underwrites" FMS

The Foreign Commercial Procurement Group will take on this issue, determine methodologies for comparing/competing FMS and DCS alternatives and report back to the FPG and DSCA

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6.2. Quantify and define the value-added of FMS

This is part of the business case for comparing DCS and FMS

DSCA has provided a paper on benefits of using the FMS process in general terms

Need specifics related to individual cases for a true DCS/FMS business case analysis

Will be studied by the FCPWG and a more specific list of requirements presented to the FPG and DSCA

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7. Transportation

Good progress has been made by the Interagency Working Group in identifying documents required for repair and returns, upgrades and modifications and classified shipments

Still issues with export seizures but improved communication flow between Customs and DSCA results in quicker resolutions

Still a need for formal guidance to be documented, released and published in the SAMM

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8. Country specific cost and schedule performance

At the Security Cooperation Business Forum, members are briefed on cost and schedule performance at an aggregate level

Need to have this data at a country specific level – at least for major FMS cases – to be able to report on whether a case is: Tracking to budget Reflecting a financial overrun of <5% of case value

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8. Cost and schedule performance (cont’d)

Reflecting a financial overrun of >5% of case

value Meeting the agreed (LOA) schedule Reflecting a schedule slip of <3 months Reflecting a schedule slip of >3 months

Caveats/issues to resolve Required information must be collected

manually Perhaps can leverage Financial Management

Review process

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9. Access to contracting documentation

Need to gain better insight into the final form of contract between the US and the Vendor

Requested to better understand the performance obligations of the vendor for things such as warranty provisions, transportation clauses and price sensitivities in support contracts

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10. Blanket export authorizations

Defined as: pre-clearing of nations, or communities of US military system users, for certain categories of requirements, or securing "blanket" export authorization for lower risk defense articles

Would streamline the procurement process and speed up approvals, particularly for urgent operational requirements

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10. Blanket authorizations (cont’d)

Examples: Broadened existing blanket end-use and retransfer assurances

to provide for transfers among user communities of US military systems – suggested by Belgium

A blanket case waiver for certain routine, in service munitions requirements - suggested by New Zealand

Blanket export authorization for CF-18 system support and munitions - suggested by Canada; could also be applied to other US military systems

A provision in the “Defense Trade Controls Performance Improvement Act of 2007” - HR 4246 (introduced into the House 15 Nov 07, but never passed) would have allowed US manufacturers to export spare and replacement parts without a license to the governments of NATO allies, Australia, New Zealand and Japan, for defense articles that were previously lawfully exported

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10. Blanket authorizations (cont’d)

“If the Departments of State and Defense have approved the export of a major defense article to one of our closest allies, why are we requiring licenses for nuts, bolts and brackets to keep these items working?” Representative Don Manzullo (R-IL), Chairman

of the Congressional Export Controls Working Group and one of the bill’s sponsors.

04/14/08Source: DSAMS 11 Jul 08

LOR COMPLETION TIME LOR COMPLETION TIME

1 Oct 06 – 30 Jun 081 Oct 06 – 30 Jun 08

AVERAGE TIME: LOR RECEIPT TO LOR COMPLETE

3130

18 18

21

16

39

34

14 13

13

24

0

5

10

15

20

25

30

35

40

45

All Army Navy Air Force

Av

era

ge

# D

ay

s

LOA AMD MOD

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LOA in Development-Team International-DSCA Policy

There is a recognized need to bring the relevant parties in an export sale together at the earliest possible time to better define program requirements and influence program execution. By developing a true partnership among the US government, the foreign customer, and US industry, the overall export sales and transfer process will be improved through greater understanding of each other’s needs, expectations, and limitations

Team International is best suited for programs that: Introduce a weapon system into a customer’s inventory. Integrate a weapon system on a nonstandard or non-U.S.

platform. Involve more than one military department.

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Team International

Team International can be formed for any of the following reasons:

Respond to a customer’s preliminary and formal requests for information, release of technical data, pricing, procurement, and delivery schedules regarding a potential acquisition of US platforms, weapons and/or major military systems and services.

Promote increased participation by key stakeholders in the development of Letters of Request (LOR)/Letters of Offer and Acceptance (LOA) or other documentation and the supporting contract.

Assist the customer in identifying or refining requirements for an acquisition, systems support, or systems upgrade program.

04/14/08 PERU July 2009. 04/14/08 Customer Tools for Effective Case Management SAM-I, 5/1/09.

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Transcript of 04/14/08 PERU July 2009. 04/14/08 Customer Tools for Effective Case Management SAM-I, 5/1/09.