Defense Logistics: DOD Has Addressed Most Reporting Requirements and Continues to Refine Its Asset Visibility Strategy
Released: 2015-12-22T00:00:00

Letter

Background

DOD’s supply chain is a global network that provides materiel, services, and equipment to the joint force. DOD has had weaknesses in maintaining visibility of supplies, such as problems with inadequate radio- frequency identification information to track all cargo movements.

We added this area to the High-Risk List in 1990. Since that time, we have reported on various aspects of DOD’s supply chain, including asset visibility. Most recently, in our 2015 High Risk update, we reported on progress DOD has made in addressing weaknesses in its asset visibility, including developing its 2014 Strategy for Improving DOD Asset Visibility.

DOD’s Implementation of IUID

In May 2012, we evaluated DOD’s implementation of IUID and found that the department had taken some steps to improve its approach to implementing IUID technology but had not employed best management practices, such as goals and interim milestones, for gauging its progress in implementing IUID. Further, we found that DOD’s ability to track and share IUID data across components was hampered because the data were not fully integrated into the components’ enterprise information systems. DOD had not developed complete, integrated master schedules for integrating IUID DOD-wide and within the components’ systems. In 2012, we recommended several actions, including that DOD (1) develop quantifiable goals and milestones for marking its legacy items that would allow it to track progress toward those goals and (2) develop or revise master schedules for integrating IUID technology into the components’ Enterprise Resource Planning Systems. DOD concurred with these recommendations and stated that its IUID working group would establish interim milestones to track the progress of marking its legacy assets. Actions DOD has taken to address this recommendation in its 2014 and 2015 strategies are discussed later in this report.

DOD’s Draft Strategy for In-Transit Visibility

In February 2013, we reviewed DOD’s draft strategy for in-transit visibility and found that it included some, but not all of the elements GAO had previously identified as necessary for a comprehensive strategic plan, including a mission statement; a problem definition, scope, and methodology; goals and objectives; activities, milestones, and performance measures; resources and investments; information about organizational roles, responsibilities, and coordination; and a description of key external factors that could affect the achievement of goals. At that time, we found that the 2013 draft strategy fully included one of the seven elements of a comprehensive strategic plan, partially included four elements, and did not include two elements. For example, we found it included overarching goals and objectives, but it did not include information on DOD’s planned resources and investments to achieve those goals or key external factors that could affect the achievement of the goals. We recommended that DOD finalize its 2013 draft strategy and ensure that it contained all the key elements of a comprehensive strategic plan, including the elements that were not included in the draft strategy. DOD concurred with our recommendation and developed its 2014 Strategy for Improving DOD Asset Visibility. We discuss the extent to which DOD included many of these elements later in this report.

DOD’s First Strategy for Improving DOD Asset Visibility

In January 2014, DOD issued its Strategy for Improving DOD Asset Visibility. The 2014 Strategy included 22 implementation plans developed by the components that outlined initiatives intended to improve asset visibility. We reviewed DOD’s 2014 Strategy and reported in January 2015 that it included five of the seven elements of a comprehensive strategic plan but only partially included the other two elements. For example, 4 of the 22 implementation plans did not include resources, investments, and key external factors. As part of our January 2015 report, we recommended that DOD take four actions to improve its management of asset visibility including that DOD include information in subsequent updates to the Strategy and accompanying SEPs about which elements were used in developing cost estimates for resources and investments. DOD again concurred with our recommendations and stated in written comments included in the January 2015 report that it planned to address all four of our recommendations in its forthcoming 2015 Strategy. We discuss the status of these recommendations later in this report.

GAO’s High-Risk List

In February 2015, GAO issued its 2015 High-Risk Series Update, which included DOD’s Supply Chain Management. For DOD asset visibility, we reported that DOD had demonstrated leadership commitment and had made considerable progress in addressing the remaining four criteria for removal from the High-Risk List (capacity, corrective-action plan, monitoring, and demonstrated progress) through actions like developing its 2014 Strategy. We reported that DOD needed to take a number of actions to address the remaining four high-risk criteria that it had partially met. Specifically, DOD needed to include information in updates to the 2014 Strategy on the factors it had used in developing cost estimates for resources and investments. We also advised that DOD needed to clearly specify the linkage between the goals and objectives in the 2014 Strategy and the plans intended to implement it. We reported that DOD should assess, and refine as appropriate, existing performance measures to ensure that these measures assess implementation of individual plans as well as progress toward achieving the overarching goals and objectives outlined in the 2014 Strategy. Lastly, we reported that DOD needed to continue implementing the plans identified in the 2014 Strategy, refining them over time as appropriate, and demonstrating that implementation of these plans results in measurable outcomes and progress toward realizing the goals and objectives in the 2014 Strategy. DOD concurred, and the status is discussed later in this report.

DOD’s Update to the 2014 Strategy

In October 2015, DOD issued its update to the 2014 Strategy. Like its predecessor, DOD’s 2015 Strategy states that it is intended to create a framework whereby the DOD components can work collaboratively to enhance asset visibility in a manner that provides accurate, reliable, and timely data to track assets throughout their life cycle.

DOD’s 2014 Strategy Fully Addresses Several of the Statutory Elements, and DOD’s 2015 Strategy and Implementation Plans Fully Address Most of the Remaining Elements

DOD’s 2014 Strategy and accompanying implementation plans fully address six and partially address five of the statutory elements set forth in the Fiscal Year 2014 National Defense Authorization Act; and DOD’s 2015 Strategy and accompanying implementation plans address additional information for most of the statutory elements, including fully addressing four of the five elements that were partially addressed in the 2014 Strategy. DOD’s 2014 Strategy and implementation plans contain limited information on its collaboration efforts with industry to identify and incorporate best practices, but its 2015 Strategy provides more information on its efforts to collaborate with industry, including examples where that collaboration has resulted in initiatives intended to improve asset visibility. Additionally, DOD continues to make progress in addressing weaknesses in its implementation of IUID by establishing in its 2014 Strategy milestones for its implementation of IUID. Finally, in its 2014 Strategy, DOD identified 22 implementation plans but did not link its plans with the Strategy’s overarching goals and objectives. DOD has implemented 16 of its original 22 implementation plans and has identified in its 2015 Strategy new plans that link to the overarching goals and objectives in the 2015 Strategy.

DOD’s 2014 Strategy and Accompanying Implementation Plans Fully Address Six and Partially Address Five of the Statutory Elements, and its 2015 Strategy Fully Addresses Four of the Five Elements Previously Reported as Partially Addressed in the 2014 Strategy

We reviewed DOD’s 2014 Strategy and determined that the documents fully addressed 6 of the 11 statutory elements and partially addressed the remaining 5 (see table 1). Specifically, DOD’s 2014 Strategy fully addressed the following 6 elements: (1) overarching goals and objectives desired from implementation of the strategy; (2) a description of steps to achieve these goals and objectives, as well as milestones and performance measures to gauge results; (3) a description of the roles and responsibilities for managing and overseeing and implementing the Strategy; (4) a detailed description of asset marking requirements and how automated information and data-capture technologies could improve readiness, cost effectiveness, and performance; (5) a defined list of all categories of items that program managers are required to identify for the purposes of asset marking; and (6) a description of steps to improve asset tracking and in-transit visibility for classified programs. For example, we determined that DOD’s 2014 Strategy and accompanying implementation plans fully addressed roles and responsibilities for managing and overseeing the Strategy because they discuss the management structure established to oversee the execution and track progress. The 2014 Strategy also assigns roles and responsibilities and discusses several forums or working groups, such as the Asset Visibility Working Group, that provide a forum for discussion and input on improvements to asset visibility.

However, not all of the statutory elements were fully addressed. Specifically, the following 5 elements were partially addressed in the 2014 Strategy: (1) an estimate of the costs associated with executing the plan, and the sources and types of resources and investments required to meet the goals and objectives; (2) a description of key factors external to DOD and beyond its control that could significantly affect achievement of the long-term goals contained in the strategy; (3) steps to be undertaken to facilitate collaboration with industry designed to capture best practices, lessons learned, and any relevant technical matters; (4) a description of how improved asset tracking and in-transit visibility could enhance audit readiness, reduce counterfeit risk, enhance logistical processes, and otherwise benefit DOD; and (5) an operational security assessment designed to ensure that all DOD assets are appropriately protected during the execution of the strategy and implementation plan. For example, we determined that an operational security assessment was partially addressed, because while the 2014 Strategy provided examples of safeguards that are either in place or planned to ensure the security of DOD assets, it is not clear whether an operational security assessment had been conducted and, if it has, what the results of that assessment were.

Table 1 includes our assessment of the extent to which DOD’s 2014 Strategy addressed the 11 statutory elements. Additionally, since DOD issued its 2015 Strategy during our review, we assessed the 2015 Strategy for changes to the strategy from 2014 through 2015.

In addition to assessing DOD’s 2014 Strategy and accompanying implementation plans to determine the extent to which DOD satisfied its mandate, we also reviewed DOD’s 2015 Strategy, which was issued in October 2015, to determine changes that had been made between 2014 and 2015. We found that four of the five elements that were partially addressed in the 2014 Strategy are fully addressed in the 2015 Strategy. Specifically, in its 2015 Strategy, DOD fully addresses a description of key factors external to DOD and beyond its control that could significantly affect achievement of the long-term goals contained in the strategy; steps to be undertaken to facilitate collaboration with industry designed to capture best practices, lessons learned, and any relevant technical matters; a description of how improved asset tracking and in-transit visibility could enhance audit readiness, reduce counterfeit risk, enhance logistical processes, and otherwise benefit DOD; and an operational security assessment designed to ensure that DOD assets are appropriately protected during the execution of the strategy and implementation plan.

For example, DOD has added detailed discussion to its 2015 Strategy regarding the steps it is taking to collaborate with industry to capture best practices, lessons learned, and any relevant technical matters, including examples of where that collaboration led it to incorporate commercial automated information and data-capture technologies. The 2015 Strategy discusses DOD’s migration of active Radio Frequency Identification (RFID) from a proprietary communication standard protocol to an international standard to increase competition and lower costs and its partnership with a satellite tag provider to improve cargo tracking and the security of containerized cargo, to enable advanced cargo tracking. Additionally, DOD’s 2015 Strategy explains how IUID information will, among other things, support “logistics support decisions,” reduce the introduction of counterfeit parts into the supply chain, and support the achievement of clean audit opinions on DOD’s financial statements. Further, the 2015 Strategy contains criteria to assist DOD in determining the operational risk associated with the loss (damage, pilferage, etc.) of parts and equipment, to include determining which DOD assets require a higher level of security and management using IUID marking.

One statutory element—an estimate of the costs associated with executing the plan, and the sources and types of resources and investments, including skills, technology, human capital, information and other resources, required to meet goals and objectives—remains partially addressed in DOD’s 2015 Strategy. The 2015 Strategy calls for the components to consider items such as manpower, materiel, and sustainment costs when documenting cost estimates for the implementation plans. However, our review of the 2015 Strategy showed that three of the implementation plans do not include cost estimates. We recommended in our January 2015 report that DOD include information about which elements were used in developing cost estimates in subsequent updates to the strategy and accompanying implementation plans. Further, we reported in our February 2015 High Risk report that these cost estimates are important to ensure that DOD has the information it needs to make well-informed decisions about asset visibility, including setting budget priorities. Officials from the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration told us that the components did not include the cost estimates for the three implementation plans, pointing out that the funding for these plans is embedded within the overall program funding and it is impossible for the components to estimate the portion of total program funding associated with the plans. For example, two of the three plans that did not contain cost estimates are intended to enhance the capability of the Global Combat Support System–Joint (GCSS-J) to provide asset visibility and are funded by overall program funding for the GCSS-J rather than funding for the individual asset visibility implementation plans. Component officials argue that it is therefore impossible to isolate the costs associated with these implementation plans. We understand that the components may fund these initiatives from total program funding; and therefore, may not estimate the costs associated with the plan. However, without any idea of the cost associated with these plans, the components may be unable to determine the return on investment associated with them. We continue to believe DOD should follow its direction provided in the 2015 Strategy and require the components to estimate the costs associated with its implementation plans intended to improve asset visibility, as we have previously recommended. In October 2015, officials stated that DOD plans to provide direction in the next annual update to the Strategy on how to explain and document these cases, although they commented that there will be cases where the components may not be able to isolate the costs associated with an implementation plan.

DOD Provided Limited Information in the 2014 Strategy on Its Collaboration with Industry but Addressed the Issue More Fully in Its 2015 Strategy

As previously mentioned, DOD’s 2014 Strategy contained limited information on DOD’s efforts to collaborate with industry to identify and incorporate best practices. The 2014 Strategy includes phrases like “capitalization on better business processes,” but provides little explanation of how DOD is incorporating or has incorporated business best practices and lessons learned into its plans for improving asset visibility. DOD’s 2014 Strategy states that this element will be discussed in DOD’s 2015 Strategy. The 2014 Strategy further comments that DOD has numerous processes to keep abreast of and to evaluate or incorporate emerging technologies that show promise for enhancing DOD business processes, including participation or membership in the various AIT standards bodies, review of trade journals, and participation in trade forums. The 2014 Strategy references symposiums, such as DOD’s AIT in DOD Summit, where AIT industry leaders and international and DOD standards representatives meet to review AIT lessons learned, among other things.

Our review of DOD’s 2015 Strategy and implementation plans found that DOD has added information on its collaboration with industry to incorporate best practices, and has provided examples of where this collaboration has resulted in improvements to asset visibility. For example, DOD discusses the processes it utilizes for identifying and evaluating emerging technologies, such as participating in the AIT standards bodies and trade forums and DOD’s Research, Development, Test, and Evaluation (RDT&E) program. Additionally, as discussed in DOD’s 2015 Strategy, DOD worked with commercial partners to incorporate passive RFID to improve the accuracy of its inventory and decrease processing time for new recruits at Lackland Air Force Base. In some cases, the 2015 Strategy discusses results achieved from this collaboration in terms of the performance metrics for the initiatives. For example, DOD reported testing the application of passive RFID at Lackland Air Force Base, which it found improved its inventory accuracy and reduced the time for processing recruits by over 50 percent. DOD also reported working with a commercial provider to improve cargo tracking and the security of containerized cargo. Specifically, DOD reports that by using an industry-proven process where the logistics provider—industry—owns the tracking system; DOD is able to track cargo in a more affordable way. Key practices for effective collaboration call for agencies to, among other things, develop mechanisms to monitor, evaluate, and report on results of their collaborative efforts. Officials from the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration agreed that they should continue to discuss more in future updates to the Strategy improvements achieved for the initiatives resulting from collaboration with industry and stated that they are continuing to work with the components to assess the results stemming from the initiatives that have been implemented.

DOD Has Established Milestones for IUID Implementation in Its 2014 Strategy, and Has Updated Its IUID Instruction, but Implementation Challenges Remain

DOD’s 2014 Strategy demonstrates progress in establishing milestones for implementing IUID, and DOD recently updated its instruction for IUID marking. In its 2014 Strategy, DOD provides an integrated master schedule for IUID implementation with interim milestones for fiscal years 2013 through 2017. Specifically, DOD provides an integrated master schedule showing, at the department level, issues such as marking legacy items, training, and system updates and hardware that need to be addressed to implement IUID—and the interim milestones associated with each of these issues. In addition, DOD provides a schedule for an IUID automated information system update and an IUID item marking schedule by component. These schedules provide interim milestones for each of the components that are intended to illustrate planned timelines for integrating IUID information into enterprise planning systems and for marking IUID items.

As we found in 2012, DOD faces challenges with the integration of IUID data into the components’ enterprise information systems. This problem is not unique to IUID, as evidenced by our March 2014 report on ammunition where we found the automated information systems used by the military services to manage and maintain accountability for DOD’s ammunition inventory have limitations that affect their ability to facilitate efficient management of conventional ammunition, including that the systems cannot directly exchange ammunition data with each other. Specifically, we found that several of the systems involved in DOD’s overarching Enterprise Resource Planning (ERP) system were not being implemented on schedule and on budget. DOD officials have said that successful implementation of ERP, which has not yet occurred, is key to resolving the long-standing weaknesses in the department’s business operations in areas such as supply chain management and improving the department’s capability to provide DOD management and Congress with accurate and reliable information on the results of its operations. Specifically, DOD’s goal is for the components to share IUID data across many of their individual IT systems, and DOD-wide, between components. In order to accomplish enterprise-wide data sharing of this data, DOD officials stated that the components intended to use certain IT systems referred to as ERP systems. Absent successful integration of ERP, DOD is getting limited use from its IUID information, as only a few systems are able to recognize and use IUID data.

On September 3, 2015, DOD issued an update to its Instruction 8320.04, Item Unique Identification Standards for Tangible Personal Property. We reviewed the updated DOD Instruction 8320.04, which includes a decision tree that is intended to assist DOD components in determining which items should be IUID marked based on criteria such as whether the item is susceptible to counterfeiting. DOD has reported that the use of IUID could improve the accountability and maintenance of its components’ property and equipment. For example, by sharing unique item identification data across the components’ IT systems, DOD could follow equipment as it moves between components. In addition, a component could use these data in its IT systems to more quickly identify items that require higher amounts of maintenance. DOD’s 2015 Strategy includes updated milestones for IUID marking and schedules for updating automated information systems by component for fiscal years 2015 through 2019 (the 2014 Strategy includes schedules for fiscal years 2013 through 2017). However, it is not always clear what progress DOD has made against the original milestones set in its 2014 Strategy. Specifically, while DOD’s milestones for IUID marking in the 2015 Strategy include goals for percentages of items marked for all of the components, it is not clear what percentage of items have been marked to-date for each of the services. For example, while the Navy shows goals for the percentage of items it would like to have IUID marked by fiscal year 2018 and beyond, it does not show what percentage of items have been marked against that goal. Similarly, the milestones for updating automated information systems do not show progress made to-date. DOD officials agreed that it is not clear what progress has been made in meeting the milestones for fiscal years 2013 and 2014 for updating the military services’ automated information systems and have added legends to the milestone charts and language in the Strategy to clarify the progress that has been made. However, in comparing the milestones in the 2014 Strategy and those in the 2015 Strategy, we are still unable to determine which of DOD’s milestones for IUID marking and updating automated information systems have been achieved.

We have previously concluded that milestones provide decision makers with the information they need to assess progress and estimate realistic completion dates. In May 2012, we recommended that DOD establish quantifiable interim milestones for IUID marking of legacy items, which would allow DOD to track progress toward its goals for IUID marking. We also recommended that DOD develop or revise integrated master schedules for the integration of IUID technology within the components ERP systems. While DOD’s establishment of milestones for its IUID implementation efforts is a positive step, the utility of those milestones will be limited if it is unclear with each update of the Strategy what progress DOD has made in achieving its previous milestones and how that is affecting timelines in its 2015 Strategy. We discussed the milestones with officials to determine whether further updates were planned to make it more apparent what progress had been made against its 2014 milestones for IUID marking and automated information system updates, and officials agreed it was not altogether clear what progress had been made against the IUID milestones, particularly those associated with updating automated information systems. In an attempt to add clarity, DOD revised its IUID milestones for automated information system updates in the 2015 Strategy to reflect progress made by the Army and Marine Corps in updating their systems to read and share IUID data. The officials stated they are committed to further revising the milestones to provide insight on the progress that has been made in meeting interim milestones for integrating IUID data into DOD’s automated systems. DOD officials commented in October 2015 that they will continue to capture IUID progress and plan to update the format for the automated information systems milestones to ensure that progress that has been made is more easily understood.

DOD Continues to Implement Many of the Initiatives Identified in Its 2014 Strategy, and Has Identified New Initiatives in Its 2015 Strategy While Linking Them to Its Overarching Goals and Objectives

Since issuing its 2014 Strategy, DOD has implemented 16 of its original 22 implementation plans included in its 2014 Strategy. However, DOD did not link its implementation plans with the 2014 Strategy’s overarching goals and objectives. DOD added eight new implementation plans to its 2015 Strategy and linked each of these plans to the 2015 Strategy’s overarching goals and objectives. Aligning agency-wide goals and objectives with strategies to achieve those goals and objectives is a key practice that could increase the effectiveness of DOD’s efforts to improve asset visibility. Further, leading practices to promote successful data- driven performance reviews include ensuring alignment between agency goals, program activities, and resources.

DOD identified, in its 2014 Strategy, 22 implementation plans, which outline initiatives intended to improve asset visibility. The 2014 Strategy states that implementation plans detailing new initiatives identified by the components will be included in future versions of the Strategy. The Strategy also contains overarching goals and objectives for improving asset visibility. In January 2015, we found that 6 of the 22 implementation plans included in DOD’s 2014 Strategy had been implemented. For example, in 2014, U.S. Transportation Command (TRANSCOM) implemented a plan intended to create an integrated system for asset visibility information that is included in transportation and supply data systems and is now being used to enhance asset visibility. According to DOD, this new integrated system provides users with a single portal for viewing integrated supply and transportation data, making it possible to support virtually any business process with improved asset visibility.

We reported in January 2015 that the 2014 Strategy calls for components to identify at least one metric for assessing the implementation of each of its plans that are intended to improve asset visibility. However, the 2014 Strategy did not require that metrics developed for the plans link back to the goals or objectives in the 2014 Strategy, and we found that it was not clear whether the metrics link to the goals and objectives. Without creating a clear link between the goals and objectives in the 2014 Strategy and the plans intended to implement the 2014 Strategy, it will be difficult for DOD to assess progress toward realizing its goals and objectives. Therefore, we recommended that DOD ensure that the linkage between the performance measures for the individual plans and the goals and objectives outlined in the 2014 Strategy is clear. DOD concurred with our recommendation.

Subsequent to issuance of its 2014 Strategy, DOD implemented an additional 10 of the 22 original plans. For example, the U.S. Marine Corps’ Blount Island Command has implemented long-range passive RFID for visibility and accountability of items, resulting in improvements including an increased range for “reading” an item—from up to 30 feet to up to 240 feet—and reduced inventory cycle times from 12 days to 10 hours. Additionally, the Joint Staff has implemented its plan to develop in- transit visibility capabilities within the Global Combat Support System- Joint (GCSS-J), a web-based logistics program that was developed to provide logisticians with visibility and decision support tools to effectively plan and execute joint logistics support for current and future operations.

According to DOD, GCSS-J has dramatically improved functionality over the last several program releases to access and visualize logistics information. Also, after the release of the most recent software version, users graded GCSS-J as having exceeded their expectations with a 96 percent customer satisfaction rating.

While the 2014 Strategy introduced 22 implementation plans intended to improve asset visibility, the 2015 Strategy introduced additional plans. Specifically, DOD has added eight new implementation plans to its 2015 Strategy. For example, the U.S. Air Force’s Global Enterprise Tracking initiative uses real-time location system technology to track aircraft and critical assets and is expected to reduce the time required for these assets to get through depots. Additionally, the Non-Nodal In-Transit Visibility plan is expected to improve combat effectiveness by providing near real-time visibility of sustainment cargo and confirmation of delivery of the cargo to tactical units. An overview of the initiatives included in DOD’s 2014 and 2015 Strategies and implementation plans is included at appendix I of this report.

The 2015 Strategy also includes matrices that link each of DOD’s ongoing implementation plans to the Strategy’s overarching goals and objectives. Additionally, measures of performance and effectiveness have been identified for each plan. For example, the measure of performance for the Navy’s passive RFID plan for the Littoral Combat Ship is to conduct a technical assessment and one of its measures of effectiveness is to reduce inventory workload by 50 percent. By creating a clear link between the goals and objectives in the Strategy and the implementation plans intended to implement the Strategy, as well as identifying measures of performance and effectiveness, DOD should be better positioned to monitor progress toward the implementation of its plans and achievement of its overarching goals and objectives for asset visibility.

Agency Comments

We are not making recommendations in this report. We provided a draft of this report to DOD for advance review and comment. DOD did not provide any comments to include in this report.

We are sending copies of this report to the appropriate congressional committees and the Secretary of Defense. In addition, the report is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions about this report, please contact me at (202) 512-5257 or merrittz@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. Key contributors to this report are listed in appendix III.

Appendix I: DOD’s Implementation Plans to Improve Asset Visibility

This appendix provides an overview of DOD’s implementation plans intended to improve asset visibility and progress in implementing those plans. These implementation plans are described in detail in both DOD’s 2014 and 2015 Strategies for Improving DOD Asset Visibility.

The implementation plans in table 2 below were included in DOD’s 2014 Strategy for Improving DOD Asset Visibility and have been implemented, according to DOD.

The implementation plans in table 3 below were included in DOD’s 2014 Strategy for Improving DOD Asset Visibility but were halted for the reasons stated.

As of July 2015, the implementation plans in table 4 below were in the process of being implemented and were included in both DOD’s 2014 and its 2015 Strategies for Improving DOD Asset Visibility.

The implementation plans in table 5 below were included for the first time in DOD’s 2015 Strategy for Improving DOD Asset Visibility.

Appendix II: Scope and Methodology

To assess the extent to which the Department of Defense (DOD) satisfied its mandate to provide Congress a comprehensive strategy for improving asset tracking and in-transit visibility that includes each of the 11 statutory elements, we reviewed DOD’s October 2014 Report to Congress on the Strategy to Improve Asset Tracking and In-Transit Visibility, which incorporated its January 2014 Strategy for Improving DOD Asset Visibility and accompanying implementation plans. We refer to the 2014 strategy document, implementation plans, and 2014 report collectively as the 2014 Strategy. We performed a content analysis in which two analysts independently reviewed DOD’s 2014 Strategy and compared the information in these documents with the 11 statutory elements and assessed the extent to which DOD had addressed each required element. Any initial disagreements in the coding were discussed and reconciled by the analysts. The analysts then tallied the responses to determine the extent to which the reporting elements were addressed. We determined that DOD’s 2014 Strategy “fully addressed” an element when the documents described the entire element and “partially addressed” an element when the documents described some, but not all, parts of that element. When the documents did not explicitly reflect any part of an element, we determined that the element was “not addressed.” We discussed with officials from the Office of the Deputy Assistant Secretary of Defense for Supply Chain Integration any elements that we determined were partially addressed, to understand any efforts under way to address the elements more fully. We also discussed with officials from the Joint Staff, Defense Logistics Agency (DLA), U.S. Transportation Command (TRANSCOM), and each of the military services their roles in the development of DOD’s 2014 Strategy. DOD subsequently updated its asset visibility strategy and implementation plans in October 2015 (2015 Strategy). To understand enhancements made to the 2014 Strategy, including any efforts to more fully address those elements that were partially addressed, we reviewed DOD’s 2015 Strategy and discussed with officials future plans for addressing those items not fully addressed in the 2015 Strategy.

To determine what steps DOD has taken to incorporate industry best practices related to automated information and data-capture technologies and to implement Item Unique Identification (IUID), we reviewed DOD’s 2014 Strategy to identify the information DOD included about industry best practices and IUID. We did not identify industry best practices that exist relating to automated information and data-capture technologies, but rather assessed whether or not DOD’s 2014 Strategy discussed the department’s efforts to collaborate with industry and any examples of where this collaboration has resulted in industry involvement in the department’s plans to improve asset visibility. We also discussed with DOD officials how the department collaborates with industry to identify best practices and any work DOD has under way to enhance the discussion in the 2015 Strategy of its efforts to collaborate with industry. Further, in September 2015, we attended the annual Automatic Identification Technology (AIT) in DOD Symposium, where DOD officials, government leaders, business executives, and academics within the AIT industry gathered to discuss how industry technology users implement AIT to achieve higher returns on investment and how technology is working to improve asset visibility. Additionally, we discussed with officials efforts under way to update the 2014 Strategy and Instruction 8320.04 to address weaknesses we had previously identified and reviewed the September 2015 DOD Instruction 8320.04, Item Unique Identification (IUID) Standards for Tangible Personal Property, to determine what updates had been made. To understand enhancements being made to the 2014 Strategy, including those related to the discussion of collaboration with industry and any results of that collaboration, we reviewed DOD’s 2015 Strategy and discussed with officials implementation plans resulting from this collaboration and ongoing work to assess the effect of the collaboration on DOD’s plans. Further, we also reviewed documentation resulting from agency efforts to address recommendations in our 2015 high-risk asset visibility report.

To determine what progress DOD has made in implementing its 2014 Strategy’s implementation plans and in aligning the initiatives outlined in those plans with its overarching goals and objectives for asset tracking and in-transit visibility, we reviewed DOD’s 2014 Strategy’s implementation plans and discussed with the components the plans they had implemented or were implementing to improve asset visibility. We also reviewed updates to those implementation plans that the components had provided to the Asset Visibility Working Group. Additionally, to understand what plans were identified subsequent to the issuance of the 2014 Strategy, we reviewed DOD’s 2015 Strategy and discussed with officials the current status of all of DOD’s implementation plans. See appendix I for a complete list of implementation plans appearing in both the 2014 and 2015 Strategies along with their implementation status.

We conducted this performance audit from January 2014 to December 2015 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Appendix III: GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the contact named above, Carleen C. Bennett, Assistant Director; Elizabeth Curda; Nicole Harris; Joanne Landesman; Amie Lesser; Felicia Lopez; Greg Pugnetti; Mike Silver; Sabrina Streagle; Susan Tindall; and Jose Watkins made key contributions to this report.

Related GAO Products

High-Risk Series: An Update. GAO-15-290. Washington, D.C.: February 11, 2015.

Defense Logistics: DOD Has a Strategy and Has Taken Steps to Improve its Asset Visibility, But Further Actions are Needed. GAO-15-148. Washington, D.C.: January, 27, 2015.

Defense Logistics: A Completed Comprehensive Strategy is Needed to Guide DOD’s In-Transit Visibility Efforts. GAO-13-201. Washington, D.C.: February 28, 2013.

High-Risk Series: An Update: GAO-13-283. Washington, D.C.: February 14, 2013.

Defense Logistics: Improvements Needed to Enhance DOD’s Management Approach and Implementation of Item Unique Identification Technology. GAO-12-482. Washington, D.C.: May 3, 2012.

Defense Logistics: DOD Needs to Take Additional Actions to Address Challenges in Supply Chain Management. GAO-11-569. Washington, D.C.: July 28, 2011.

DOD’s High-Risk Areas: Observations on DOD’s Progress and Challenges in Strategic Planning for Supply Chain Management. GAO-10-929T. Washington, D.C.: July 27, 2010.

Defense Logistics: Lack of Key Information May Impede DOD’s Ability to Improve Supply Chain Management. GAO-09-150. Washington, D.C.: January 12, 2009.

High-Risk Series: An Update. GAO-09-271. Washington, D.C.: January 2009.