good morning please be seated ladies and gentlemen welcome we thank our witnesses thank our colleagues on the panel and thank our guests for being with us this morning for today's hearing any large organization has a responsibility for acquiring goods and getting the amount of goods to the place where they are needed at the time when they are in the most efficient and productive way there are few organizations in the world perhaps context of some challenges and difficulties that have been raised in that context has looked at this issue over a number of years and identified some of those challenges some of the  difficult examples that have come up in the past in the past really jumped out at between two thousand and four and two thousand and seven it was concluded that the army had three point six  at the other end of the spectrum around the time of the iraq buildup fully understanding that this was a very stressful time for everyone involved in the department of defense for example the thirty two thousand six hundred dollars for the same product indicates that the challenges are substantial the purpose of our hearing this morning here about the progress that's been made in meeting those challenges  planning and strategy with global command and control serving as the single focal point for the war fighter command manage point five billion dollar budget over forty two hundred personnel general mccoy is a south to address as the department's use of contractors and grown as large combat support provides over forty two billion dollars in goods and services to our military serving domestically and around the world including the ongoing campaigns in iraq and afghanistan in fiscal year two thousand and eight this crucial logistical support to our military makes d l a along with the rest employ sound contracting practices in requirements appropriate contract and exercising effective contract management in the absence of the self to unnecessary risk and may not be able to ensure that tax dollars are spent on goods and services that provide the best value there are several contracting practices we continue to view as most vital in order to mitigate the first one making a contract a prerequisite to good outcomes as a match between well defined requirements and available resources this requires accurate demand and supply forecasting and realistic time frame among other things our previous reports and testimonies have highlighted several cases where poorly defined and changing requirements have contributed to increase risk of choosing the wrong wrong contract for the situation such as reexamining programs decide whether prime vendor for example is the best acquisition strategy third  and commodities d l a officials acknowledge that part of what led to the problem was poorly trained contracting personnel and implemented additional training for its contracting officers and managers over the last several years we've made individual leadership to translate policy and practice and the whole decision makers accountable finally the recent surge forces in afghanistan make it critical that contract oversight is adequately performed to minimize the employing lessons learned from commercial industry from academia and government we are eliminating duplications and focusing on standardization of our critical process getting started and are extremely proud of our progress today as a delivery eliminating inventory and reducing costs they provide the same high quality support to deployed war fighters to military service members in the united continental united deal as a where of its responsibility to maintain its industrial base of which small businesses are a critical component approximately fifty million dollars of congressional funding to maintain production capacity for go to  thousand and nine hundred dollars would have been shocked to go two thousand dollars for one they would do that they would say wait a minute what's different about this refrigerator was it cost more does that not happen place more in locations where the need is not there in that location so we spend a tremendous amount of our analysis trying to make sure that we can dennis where the need will occur and to put the right amount of inventory at those locations in the event that a need arises greater than we anticipated at another location objective is to try to move that and torrie rather than buying new inventory the precious dollars that we have we know that we have to spend  wisely and in fact to your earlier question one of the principles that we operate by is to treat resources as though they were our own so if we're buying components to go on aircraft or buying refrigerators we want to treat those as though their own resources and therefore not buy one more than we have to environment however we also want to make sure that we can consider contingencies but we also want to make sure that we don't exceed that requirement even preparing for contingencies even with all  airplanes that often break today it becomes even more difficult to find those points but we move resources around we have visibility of those around the world and we would rather move them rather than replace them with new amatory when we have that opportunity purposes anybody can for a certain kind of copier that can handle heavier load of copies what's the process begin to look in the commercial sector or and then only if the commercial sector doesn't provide it proactive rather than reactive and that is probably been one of the underpinnings of why don't you give us an example of one of the ways their product what did they diagnose and start to do or stop doing what they look at is  typical are such databases throughout our acquisition system in other words if i was responsible for buying bottles of water how much data would be available for me about patterns of how much water we  considering your written testimony and i would appreciate you supplementing the record with a request morning in the first quarter of two thousand and ten the panel is going to meet and discuss among ourselves recommendations that we think would respond to some of the issues raised in our hearings we would certainly solicit your input as to those recommendations as to what you think could be done the panel the issuing a report in the first quarter of calendar two thousand and ten with the goal of  presenting to the chairman and the ranking member on the full committee some legislative ideas for inclusion in the defense authorization bill so we welcome your continued participation not just this morning we thank you for the excellent job that you did