Better Investment Decisions Can Save Money at GSA and FAA

Highlights

An effective and efficient logistics system is one which maintains sufficient, but not excessive, stocks on hand to meet users' needs. Logistics managers must decide when to buy and how much to buy. In order to make these decisions, managers need current and valid cost, demand, leadtime, and safety level data. GAO reviewed how the General Services Administration (GSA) and the Federal Aviation Administration (FAA) managers make these purchasing decisions.

Recommendations

Recommendations for Executive Action

Agency Affected	Recommendation	Status Sort descending
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to establish a separate leadtime database for Small Business Administration section 8A contractors and include section 8A due-ins in the requirements determination process.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to develop a system which relates the need for and amount of safety level to item essentiality.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to use leadtime variation, rather than the length of leadtime, in the computation of safety level requirements.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to compute an item's safety level requirement on a systemwide basis, rather than on a depot-by-depot basis.	Closed Please call 202/512-6100 for additional information.
Federal Aviation Administration	The Administrator of FAA should adopt a variable safety level concept which considers the individual characteristics of an item--including item essentiality and demand and leadtime variations--in determining safety level requirements.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service and the Secretary of Transportation to direct the Administrator of FAA to implement the recently revised cost factors and to take advantage of opportunities offered by recent economic order quantity modeling developments to optimize inventory levels and reduce inventory management costs.	Closed Please call 202/512-6100 for additional information.
Federal Aviation Administration	The Administrator of FAA should emphasize the need for timely processing of received items into the warehouse.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to reevaluate its forecasting technique with a view toward changing the weighting factors to give greater weight to the more recent demand data.	Closed Please call 202/512-6100 for additional information.
Federal Aviation Administration	The Administrator of FAA should implement the recently revised cost factors and to take advantage of opportunities offered by recent economic order quantity modeling developments to optimize inventory levels and reduce inventory management costs.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to eliminate the delays between receipt of items at the depot and their posting to the records.	Closed Please call 202/512-6100 for additional information.
General Services Administration	The Administrator of GSA should direct the Commissioner of the Federal Supply Service to exclude leadtime attributable to the period that deliveries are deferred at the agency's request from the item's leadtime history.	Closed Please call 202/512-6100 for additional information.
Federal Aviation Administration	The Administrator of FAA should use an item's actual leadtime rather than the leadtime adjusted by a rounding factor to compute requirements.	Closed Please call 202/512-6100 for additional information.

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Chuck Young

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Topics

Government Operations

Administrative costsFederal supply systemsInventoriesInventory control systemsLogisticsProgram managementProcurementInventory controlContract costsStocks