Section 328 of the National Defense Authorization Act for Fiscal Year 2010 (P.L. 111-84) required the Secretary of Defense to submit a comprehensive plan for improving the inventory management systems of the Military Departments and the Defense Logistics Agency with the objective of reducing the acquisition and storage of secondary inventory that is excess to requirements.
This plan details specific objectives, to improve forecasting and reduce or terminate orders to ensure the inventory accurately reflects actual needs, to enhance the methods for determining the amount of inventory to retain, and to ensure timely review and disposal of excess inventory and secondary item inventory that is excess to requirements.
The plan outlines two overall goals:
- By the end of FY2016, the Department will reduce total on-order excess inventory from 8.5 percent in FY2009 to 4 percent of total obligated on-order dollars.
- The Department will reduce the on-hand excess inventory from 11.3% in FY2009 to 8% of the current value of potential reutilization stocks (PRS) by the end of FY2016.
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