Publication:
An analysis of category management of service contracts

Loading...
Thumbnail Image
Authors
Clark, Austin B.
Arruda, Corey M.
Subjects
Category Management
strategic sourcing
service contracts
cost drivers
business mapping
Advisors
Landale, Karen
Apte, Aruna
Date of Issue
2017-12
Date
Dec-17
Publisher
Monterey, California: Naval Postgraduate School
Language
Abstract
In an increasingly budget-constrained environment, the Department of Defense (DOD) must maximize the value of fiscal resources obligated to service contracts. According to the Government Accountability Office report Strategic Sourcing published in 2013, over half of procurement spending between 2008 and 2013 was obligated to service contracts. Therefore, this research focused on identifying rate, process, and demand savings for common recurring DOD service requirements. We developed a methodology to standardize analysis of service requirements to identify relevant cost drivers. Furthermore, a clustering continuum was created to organize services based on proximity between the customer-supplier base. Utilizing commercial business mapping software, we analyzed the cost driver data, produced visualizations, and illustrated strategic opportunities for Category Management initiatives. Requirements for Integrated Solid Waste Management (ISWM) within the Los Angeles area were evaluated using the software and methodology to demonstrate a model for practical application. This research resulted in two findings: rate and demand savings were inconclusive but suggested opportunities do exist, and significant opportunities for process savings exist across the DOD. Further research is needed to quantify rate and demand savings and identify other opportunities to achieve efficiencies through Category Management of service requirements. We also recommend that future research focus on proximity-independent services.
Type
Thesis
Description
MBA Professional Report
Department
Business & Public Policy (GSBPP)
Identifiers
NPS Report Number
Sponsors
Funder
Format
Citation
Distribution Statement
Approved for public release; distribution is unlimited.
Rights
This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.
Collections