Government & Defence

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Asset Acquisition Strategy (Spares List Determination)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. An operating system had been introduced into service and due to regular demands for spares that could not be fulfilled (as they were not on the original spares acquisition list) was at risk of not achieving Full Operating Capability. GRA assisted the client to develop a spares buy list. Our client made use of GRA’s suggested spares buy list and recommended inventory management settings to make a one off acquisition buy to address the ‘nil stock’ issue. Once the spares acquired came into stock, the demanded spares fulfilment rate to the operator dramatically improved and the system achieved Full Operating Capability on schedule.

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Asset Acquisition Strategy (Test Equipment Options Development)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. A major component of the Support and Test Equipment (S&TE) system was due to become obsolete, with a limited window to make an acquisition decision for the number of replacement (upgraded model) units and associated test program sets. GRA assisted the client in making a timely acquisition decision with in depth analysis and modelling of future state scenario options. Our support to the client and recommendations enabled them to make a well informed decision within the limited time window, to satisfy the procurement lead time requirement and mitigate a high risk with significant consequences.

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Asset Acquisition Strategy (Logistics Support Concept Review)

Our client is responsible for managing and providing engineering and supply chain sustainment support for an aviation system. Following a series of acquisition decisions and challenges a comprehensive review of the sustainment support strategy was undertaken by GRA. We identified 30 components that may be impacted or warranted a review; assessed each component prioritising findings for a ‘deep dive’ analysis based on impact to the system and support costs; conducted a detail analysis of nine support strategy components; and recommended options with an assessment of trade-offs and impact on cost and system outcomes under each option.

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Transport Strategy, Procurement, Supply Chain Strategy, Risk Management

Our client runs one of the largest logistics events in Australia - the Federal Election. Challenges for our client include securely moving ballots to over 7,700 polling places, temporary growth in staff from 800 to 70,000, and advanced purchasing of all materials and supplies. GRA was engaged to redesign the secure transport processes, identify the best use of technology and design a tender for the private sector to respond. GRA also reviewed the procurement process and transport for all Materials used at polling places. We presented the findings and at the conclusion of the current phase of the project our recommendations have been accepted by the Acting Commissioner and the Executive Team.

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Impact of Operating Effort on Annual Expenditure

Our client, in response to Defence's 5% sustainment expenditure cuts, had targeted savings of $6.25m. GRA investigatedwhether the potential under achievement of the target Rate Of Effort (ROE) might lead to the opportunity for reduced expenditure. GRA performed a Baseline Cost Analysis and with new purchase recommendations identified a total potential saving of $1,38m.

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Spares & Rotables Inventory Management

The RAAF initiated a project to identify the opportunities associated with improving service levels, reducing inventory costs and balancing assets across the distribution network. The adoption of an inventory optimisation system / APS was identified as a fundamental part of the solution. After an exhaustive worldwide software selection process was undertaken, GAINS was selected as the preferred system. After implementation, the following was realised: $186m reduction in inventory (down from $675m to $489m), 42% reduction of the number of items held in RAAF warehouses and 67% reduction in understocked items, 47% increase in balanced items and 37% reduction in overstocked items.

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Inventory Optimisation & Service Level Improvement

Our client, required analysis of its inventory position and a review of its inventory and performance management processes in order to achieve immediate and sustainable service level improvements. Challenges included limited accountability for supply chain performance of which the Client had very limited control (pull v push processes) and needing to work within a heavily bureaucratic system. Our efforts returned a 70% reduction in understocked inventory and an 85% increase in balanced inventory as well as improved DIFOT performance from 90% to 96% with a 340% increase in transaction volume and a 28% reduction in the annual operating budget.

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Supply Chain Network Optimisation 3

Our client commissioned a review of their current maintenance, storage and distribution network and future support requirements to identify opportunities to reduce whole of life support costs, increase network capacity, improve customer service delivery and inform infrastructure requirements. Through analysis of support plans, service agreements and contracts within and between business units and the broader industry community, we determined that changing from a linear network to a multi-echelon network identified a potential reduction in Time to Make Serviceable of 55% whilst removing repetition of maintenance effort reduced Repair Time per repair of 21% for Medium Grade Repair and 12% for Heavy Grade Repair.

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"We saved $14 million in six months... here are the graphs. We're used to being promised these kinds of numbers; we're just not used to having them delivered."

– Wing Commander, Royal Australian Airforce (RAAF)

Typical results

  • 20-40% inventory investment reduction
  • increased service levels ranging up to 99.9%
  • 10%-15% reduction in supply chain operating costs
  • 5%-20% spend management savings
  • the ability to fund business initiatives from operating cash flow (OCF) improvements
  • improved return on capital employed (ROCE)
  • a minimum 3:1 ROI (10:1 to 30:1 typical)