In 2000, it was determined that the three Air Logistics Centers were underfunded compared to commercial industry. Specifically, the depots were not funded enough to allow reinvestment into capital assets. This determination was based on the fact that commercial industry reinvests 6% of its profits into capital programs while the Air Force depots reinvest only 3%. To keep the three Air Logistics Centers competitive, Congress injected $900M into the depots over a six year period, beginning in 2003. This Depot Maintenance Transformation (DMT) strategy was implemented so that the depots would increase profits over each of the six years to a point that would allow them to reinvest a sustained 6% (organically) at the end of year 6 in order to stay on par with the private sector. As the DMT program nears completion, the urgency to identify the aggregate benefits of the DMT program is increasing. However, this is not an easy task because many of the projects have intangible benefits that are hard to capture by quantifiable means. Additionally, of the tangible benefits associated with the DMT projects, 21% are reported to have negative projected savings in the out-years beyond initial investment. This makes the task of identifying the aggregate benefits that much more difficult to do. So, six years later, the question still remains: how well is the $900M DMT program performing ... but more strategically, what are the important considerations when making capital investment decisions? This Graduate Research Project addresses this important question.
In 2000, it was determined that the three Air Logistics Centers were underfunded compared to commercial industry. Specifically, the depots were not funded enough to allow reinvestment into capital assets. This determination was based on the fact that commercial industry reinvests 6% of its profits into capital programs while the Air Force depots reinvest only 3%. To keep the three Air Logistics Centers competitive, Congress injected $900M into the depots over a six year period, beginning in 2003. This Depot Maintenance Transformation (DMT) strategy was implemented so that the depots would increase profits over each of the six years to a point that would allow them to reinvest a sustained 6% (organically) at the end of year 6 in order to stay on par with the private sector. As the DMT program nears completion, the urgency to identify the aggregate benefits of the DMT program is increasing. However, this is not an easy task because many of the projects have intangible benefits that are hard to capture by quantifiable means. Additionally, of the tangible benefits associated with the DMT projects, 21% are reported to have negative projected savings in the out-years beyond initial investment. This makes the task of identifying the aggregate benefits that much more difficult to do. So, six years later, the question still remains: how well is the $900M DMT program performing ... but more strategically, what are the important considerations when making capital investment decisions? This Graduate Research Project addresses this important question.
GAO examined the Department of Defense's (DOD) depot maintenance program, focusing on whether the: (1) DOD depots should retain their engine repair capabilities; (2) opportunities exist to privatize...
The BiblioGov Project is an effort to expand awareness of the public documents and records of the U.S. Government via print publications. In broadening the public understanding of government and its...
In the early 2000s, the US Air Force (AF) realized that the capability of their organic depots was declining for a number of factors, aging workforce being one of the most significant. To determine...
The BiblioGov Project is an effort to expand awareness of the public documents and records of the U.S. Government via print publications. In broadening the public understanding of government and its...
This research addresses Air Force Material Command's desire to develop a flexible depot workforce to meet the demands of maintaining an ever-changing and aging aircraft fleet. Air Force depot...
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