Aligns incentives, increases product up-time for improved customer satisfaction
Philadelphia — February 2, 2006 — MCA Solutions today announced a new strategic planning initiative that taps its service planning and optimization (SPOT) software suite to improve value and profitability in performance-based logistics (PBL) environments.
According to the firm, the new methodology provides analytical support for performance-based contract negotiations and long-term strategic planning to enhance multi-tier supply chain coordination and resource investment decisions. As a result, companies can meet customer demands for lower service support costs and improved product performance and uptime.
The shift to PBL is becoming more important for manufacturers in mission critical environments that need to provide ultimate product availability at the lowest cost and with the highest level of customer satisfaction, MCA Solutions said. By implementing a PBL relationship, organizations throughout the extended service supply chain can align incentives by directly tying supplier compensation to product performance and customer value.
The U.S. Department of Defense has mandated that performance-based logistics programs be adopted by its major weapon systems and equipment suppliers. Suppliers such as Boeing Integrated Defense Systems, Lockheed Martin Aeronautics and Rockwell Collins recognize that customers are demanding more dependable products with reduced cost of ownership. MCA said its PBL modeling approach can be used to help such companies meet this challenge in a profitable fashion.
MCA Solutions' PBL framework builds on a project funded by Lockheed Martin Aeronautics' F-35 Joint Strike Fighter program. The new MCA offering analyzes performance-based contracts and resource management decisions with a model framework that predicts the full impact of the PBL business model on the end customer, the prime supplier and lower-tier service support suppliers.
"PBL environments have the potential to change the dynamics of supplier/customer relationships," said Dr. Morris Cohen, co-founder of MCA Solutions. "However, in order for PBL contracts to be effective, suppliers must first analyze and understand their extended supply network of parts and people to determine the best decisions for enabling optimal product performance at the lowest cost."
A recent AMR Research report called "Service Parts Planning Vendor Landscape: Managing the Service Level and Inventory Investment Tradeoff," stated "MCA Solutions, designed specifically with customer-centricity in mind, offers the most differentiated functionality at present." MCA earned the highest rating across all four categories of functionality for customer-centric businesses in AMR Research's report.