Carrier/3PL Protest Denied by Government Accountability Office

Dec. 20, 2006
The Defense Transportation Coordination Initiative (DTCI) will be allowed to continue following a Government Accountability Office (GAO) decision that

The DTCI freight management system is designed to improve the reliability, predictability and efficiency of Department of Defense (DOD) materiel moving within the continental United States by reducing cycle times and improving predictability through the use of more dedicated truck schedules, cross docking operations, better mode selection and load optimization, according to DTCI.

The process essentially centralizes the logistics functions under the coordinator with a mission of partnering with a world class transportation service provider to manage distribution in the continental United States and leveraging the logistics provider’s commercial business with best practices to achieve efficiencies in distribution and associated cost savings.

The DTCI group argued adequate competition existed and savings in excess of 15% supported the bundled service approach. Putting a dollar figure on the benefit, DOD estimates it could save nearly $60 million per year.

DOD pays private transportation companies over $1.5 billion per year for hauling services, notes James Calderwood in his bi-monthly column in Logistics Today magazine. “The transportation services procurement systems used by DOD and other government agencies are arcane and difficult to fathom. They can be perplexing to the uninitiated because they do not resemble the processes for procuring transportation in the civilian commercial sector,” Calderwood continued.

Calderwood was writing about increased enforcement efforts relative to corruption and fraud, saying that DOD’s Surface Deployment and Distribution Command has decided to go after abuse via criminal prosecutions. “All SDDC personnel are now mandated to undergo ethics and fraud training.”

The Transportation Intermediaries Association acknowledged that, in the wake of the November election, congressional Democrats had already stated they would look closely at Rumsfeld-era contracting and outsourcing.

To read James Calderwood’s column:

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