CHAPTER I : INTRODUCTION

1. As a direct result of the political situation, the NATO military mission has evolved and the financial resources available for defence have reduced in all member states. In response numerous co-operation initiatives within nations and NATO were launched in the broad field of logistics with the aim to improve upon NATO’s collective capabilities.
2. In September 1997, following an initiative from NAMSA, a NATO inter-staff group concluded that although many forms of co-operation existed, their origins were still in national priorities and objectives. Furthermore it was concluded that co-operation was carried out on a piecemeal basis.

3. Recently, the Ministerial Guidance, the Strategic Concept and the Defence Capability Initiative (DCI) acknowledge that a new approach to co-operation in logistics is required due to lower force contributions by individual allies.

4. The SNLC established an Ad Hoc Working Group (AHWG) in EAPC format to study the need for a Nato Concept for Co-operation in Logistics (NCCL) and to develop such a concept if required.

5. This document is the AHWG NCCL’s report to the SNLC on phase 1 of its work (see Terms of Reference in Annex A). It reflects the findings of the AHWG and it makes recommendations to the SNLC on the way ahead.

6. The report is a concise review of the AHWG’s findings. They serve both as rationale for a NATO Concept for Co-operation in Logistics, as well as the potential constituent elements thereof.

7. Also this document serves to inform the logistics and logistics related community in NATO and in EAPC.

8. In the absence of a formal definition, for the purpose of this study, co-operation in logistics is defined as:

9. For the purpose of this study, the aim of co-operation in logistics is to enhance the overall logistics posture of NATO, to increase efficiency of logistics support in peacetime, crisis and conflict and to achieve cost-savings through economies of scale.

10. The AHWG did not limit itself "just" to Information Systems/ Information Technology (IS/IT)-related issues (from which field the requirement originated). Neither did it limit its deliberations to operational logistics only. It covered the full range of logistics as implied by the definition in the NATO Logistics Handbook. Therefore the AHWG decided to treat co-operation in logistics in NATO as a broad topic, crossing current partitions in logistics, and adopting a through life cycle approach.

11. The WG further decided to address logistics in two major domains:

11.1 Logistic support provided to multinational forces and/or the acquisition and life-cycle support of NATO common funded equipment. The subject here is common resources, for which there is a collective responsibility.

11.2 Other forms of co-operation in logistics between NATO on a bi or multilateral basis, or between NATO and other organisations (e.g. PfP, UN, WEU etc.). In this domain NATO acts where necessary as a forum for facilitating and co-ordinating logistics co-operation.

12. The AHWG, partly in separate SWG’s, made an inventory and analysis of current logistics policy documents and ongoing logistics initiatives and programmes.

13. The results of this work were translated into a "Statement of the Issues" document. This document, with an added questionnaire, was sent for comments to a wide audience, logistics and logistics related, nations and NATO bodies. The many responses to the questionnaire were used to confirm and to refine the findings of the AHWG.

14. The AHWG recognises that its work cannot stand separate from all other ongoing developments in NATO. Amongst others, it therefore took note of the latest proposals from CNAD, NC3B and NCS. NATO bodies outside SNLC took part in the work of the AHWG, either through membership to the AHWG itself, or through the response to the questionnaire.

15. There is a close relationship between the tasks of this AHWG and the AHWG on SNLC/LSM’s TOR’s. Both groups worked closely together.

16. The logistics paragraphs of the NATO-only Defence Capabilities Initiative (DCI) for a large part overlap the work of this EAPC-format AHWG. The AHWG already is tasked with several DCI-elements. When entering phase 2, developing and implementing a NATO concept for co-operation in logistics, careful consideration should be given to what should be done by the AHWG in NATO-only session and what can be done in EAPC format.

17. The AHWG is aware that its task covers a very broad area. Because of the already overloaded agenda’s of the AHWG’s members, it was impossible to fully analyse the entire width and depth of NATO and national logistics. The AHWG, however, is confident (based on the work that has been done and on the responses received) that the following findings constitute the core of the deficiencies of and challenges to co-operation in logistics in NATO.

CHAPTER 2 : DISCUSSION AND FINDINGS

19. The New Strategic Concept and the DCI are reinforcing the need for co-operation in logistics. The focus now needs to be on looking ahead and seeking constructive long-term solutions and continuous improvement.

20. To date, most logistic support for operational forces within NATO has been planned, organised and provided directly by nations, usually on a single service basis. This approach has served the Alliance well for the past 50 years. It remains important today.

21. As the requirement for combined joint operations has grown, many different forms of logistic co-operation have emerged across the Alliance. These include:

21.1 local, ad hoc arrangements between operational units;

21.2 different models of co-operation, such as lead nation and role specialisation;

21.3 bi, or multinational agreements applicable to specific force units or weapon systems (e.g. Weapon System Partnerships);

21.4 NATO initiatives e.g. SHARE, COMMIT and PROFIT;

21.5 NATO policy and doctrine initiatives which are intended to be binding on members. (e.g. MC319/1, AJP 4).

22. The main question to be answered by the AHWG NCCL in phase 1 of its work is whether there is a need for a NATO Concept for Co-operation in Logistics. In order to answer that question, it is necessary to agree on the definition of "concept", and/or on the constituent elements of such concept. It is very difficult to reach an agreement on the exact definition of the term. Is it a business model, a road map towards actual improvements, a concept for managing the improvement process, a concept for how co-operation is meant to happen in practice for a typical mission, a set of principles or the definition of roles and responsibilities.

23. The term "concept" should therefore be seen merely as a "blanket" for any activity that may affect co-operation in logistics.

24. Schematically, this may encompass the following:

25. The AHWG used this model as a mind-set. It will also be used to support the work in phase 2.

26. The model comprises:

26.1 a shared context, consisting of vision, goals, policy terminology etc, resulting in

26.2 logistics requirements, which, through

26.3 pro-active and/or corrective activities to improve the capability to co-operate, focussed on:

26.4 the development and actual implementation of products (or, in other words, the tools to implement the policy) such as procedures, units, staff elements, IS/IT structures etc, result in

26.5 co-operating users: nations and NATO bodies, in support of troops in actual operations or exercises and during the whole of the equipment’s lifecycle.

26.6 The required mechanism for harmonisation, co-ordination and control would include existing committees and working groups such as SNLC, LSM etc, but may also require additional permanent capability at the strategic level.

27. Currently, there is no such consolidated framework for co-operation in logistics.

28. Three of the elements of the above schematic represent the main deficiencies of the present situation:

28.1 The context: what are our goals, how do we intend to reach them, what means do we intend to deploy to that end.

28.2 The products: what units, staff elements, committees, procedures, IT/IS systems, etc are needed to effectively and efficiently enhance co-operation in logistics.

28.3 The mechanism for harmonisation, co-ordination and control, including feedback flows, to continuously evaluate and improve NATO´s logistics posture through co-operation.

The following will elaborate on those elements in this order.

29. Although co-operation in logistics already is – to a large extent - properly covered in existing policy documents, there is no policy document encompassing the totality of the logistics effort in NATO. Although MC 319/1 is a fairly recent document, it merely states the policy for operational logistics. The Strategic Concept, being the next higher policy document is too "vague" in its logistics statements to act as a tangible planning base for all types of logistics in NATO.

30. The lack of a clear overall concept for co-operation in logistics and the existing sub-division of logistics into different and separate elements – production logistics, consumer logistics, operational logistics etc. – make co-operation difficult and can distract attention from the need to optimise the complete logistic supply chain, across organisational boundaries. The division of responsibilities on logistics within NATO between CNAD, SNLC and MC illustrates this problem.

31. There is a clear need for a policy document that translates the Strategic Concept into guidelines for coherent and co-ordinated development and implementation of policies for operational and acquisition logistics. This document should be a NAC level document.

32. This document should include a/o. generic goals, in the sense of what the logistic posture of NATO should be and what the goals of multinational co-operation in logistics (in NATO and in PfP) are. For the latter it must be recognised that in the field of logistics (as in the field of standardisation), higher degrees of co-operation could be hampered by national interests. This is a political question, which can not be resolved by military logisticians.

33. The NATO logistics policies should include a new approach towards co-operation in logistics. Any co-operation in NATO has to achieve a balance between what is done by nations and what is done collectively. In order to optimise the total effort, nations have to be willing to contribute to the collective effort. For this to happen, nations must be convinced that the benefits from co-operation outweigh the disadvantages. Nations will perceive co-operation as attractive only when this co-operation is clearly profitable to them, in terms of effectiveness and efficiency.

34. At the moment cost awareness is lacking generally, and perhaps especially in the operational logistics area. Logistics staffs should be able to provide financial estimates of the logistics effort to NATO commanders and to nations. Correct financial estimates are of particular importance to nations. They ultimately provide the necessary funds and they determine whether to conduct logistics nationally or in co-operation with other nations.

35. The logistic vision should therefore also be intended to create a new culture within the logistics community. It is therefore particularly important that there are clear and unambiguous objectives, which reflect this vision and guide, improve and develop co-operative logistics.

36. Part of this culture should be visibility. The exchange of information between nations and NATO concerning logistic programmes, initiatives, assets and capabilities is essential for the efficient management and co-ordination of support and co-operation between nations, NATO authorities and NATO bodies. Visibility ensures that operational efficiency is not compromised, potential increase of operational effectiveness is accomplished, more effective expenditure on logistic support is achieved, the use of national resources is optimised, distributed fairly and life costs reduced.

37. The motto for a renewed NATO concept for co-operation in logistics could be "Co-operation in logistics in NATO (and EAPC) cannot be imposed, but should be re-inforced and promoted".

38. The high level NATO policies have sufficient flexibility to accommodate increased co-operation, although the degree to which co-operation in logistics is addressed in the relevant documents varies.

39. Logistics concepts for the support of acquired NATO Defence Capabilities vary from program to program. Differences are also evident in the logistic supply process of nations.

40. This hinders co-operation on a wider scale. Therefore, whilst it is neither practical nor desirable for NATO to impose concepts and procedures on nations, there is a need to further develop a set of concepts, processes and procedures at the NATO or multinational level. The aim is to translate the inherent flexibility into more detailed concepts and processes to support the required tangible co-operation across the Alliance.

41. Furthermore, there are many logistics and logistics related documents at NATO and SC level. It would be preferable to reduce that number if possible and to at least secure consistency between those documents.

42. Concerning operational logistics, MC 319/1 already is a very useful document. The earlier basic rule that logistics is a purely national affair was changed into a more collective responsibility. However, there are some flaws that should be improved in the next update version in due time. A/o. the denomination of levels (of operations) is unclear. A logistics policy should differentiate between logistics at strategic, operational and tactical levels. Roles, responsibilities and authority of the various parties involved should be adapted to that differentiation. This should also be reflected in a further specification of terms like lead nation, role specialisation etc.

43. The implementation of policies in the form of fielded capabilities is inadequate. This problem may even grow in significance because recent NATO operations stress the need to accelerate the implementation of co-operation in logistics.

44. There are deficiencies across the whole of the logistics system. It is therefore imperative to put in place ‘enablers’ ensuring the right quality and quantity of logistic co-operation to support NATO and NATO forces in their mission.

45. These ‘enablers’ therefore really have to work, thus inviting nations to participate and to expand logistics co-operation even further. For this reason, enablers do not necessarily have to be NATO (or PfP) wide from the outset. An enabler could therefore very well be "just" a bilateral co-operation between two nations. Thus, a system could grow of various enablers, initiated by various parties and beneficial to the parties concerned. This system would develop, depending on the requirements of the moment. Consistency between all enablers should be guaranteed, in order not to let the system grow wild.

46. Enablers can be manifold. It is not feasible at this time to try to define and field every possible enabler. There is not enough staff capacity to do that; also it is very likely that there are many opportunities and requirements that the AHWG NCCL has not yet identified. For the moment it would be wise to focus on quickly developing one or two of the most prominent enablers and to create a staff capability for further work.

47. Enablers could assume many different forms. A prominent enabler is a well-defined logistics IS/IT system. Presently, there are limitations in both the data we have available and in the connectivity of the systems holding it.

48. The lack of a comprehensive, over-arching information architecture for NATO logistics seriously hampers the development and operations of NATO wide logistics and C3 information systems. It is important therefore that arrangements for overseeing the information technology requirements in logistics across the NATO community are strengthened.

49. This may consist of a single architecture, encompassing the various current separate logistics systems (operational and acquisition systems) and future additions (e.g. asset tracking systems). The prerequisites and workings of this architecture should be directly derived from the logistics policies mentioned before. Co-ordination with NC3B AND CALS is necessary.

50. Data and information are to be managed and shared across organisational boundaries. International agreements to working practices (business processes and common standards) are key elements.

51. Currently, the number and use of MILU’s is limited. The MILU’s that do exist, really contribute to strengthening logistics interoperability, including non-NATO nations participating in NATO led operations.

52. The MILU concept (being developed) and MILU’s themselves are enablers for co-operation in logistics. Implementation of this concept should therefore be expanded. The increase of the number of MILU’s, especially within the peacetime establishment but also within the crisis establishment, would greatly enhance the multinational effort.

53. There is no specific NATO education philosophy aimed at multinational co-operation in the areas of acquisition logistics and consumer logistics.

54. The logistics portion of recent exercises is only very limited and does not allow for a thorough test of the logistics system.

55. Presently, many countries are developing new training programmes individually.

56. This fragmented attention for logistics training and exercises is detrimental to the total effort. Co-operation in logistics should be higher up the training agenda. Firstly, this would reinforce the logistics system and the professionalism of those who work in it. Secondly, this would serve `getting the message across´, thus supporting the new culture mentioned earlier.

57. Improvements in this field require a clear logistics training policy and doctrine. Also, for reasons of efficiency, it would be advisable to co-ordinate the separate national efforts.

58. In NATO the ratification and implementation process of STANAG’s is such that nations can autonomously decide to join or not. Presently, there are many examples in the logistics area where standardisation is not at an optimum. Examples range from different asset tracking systems, via different port handling facilities to different POL gauges.

59. Especially for multinational formations the overall co-operation between all forces and units is essential. This requires a significant level of standardisation.

60. More generally, the standardisation of the policies, doctrines, procedures and information concerning materiel, logistics operations and support, logistics services and logistics information will foster co-operation and cost-effectiveness in logistics support.

61. Therefore the process of ratification and implementation of STANAG’s may have to be changed to make STANAG’s real enablers for co-operation in logistics. Improvements in this area must be co-ordinated with NCS.

62. Especially the responses to the questionnaire show that multinational logistic plans compete and differ on the different command levels. Also there is no common in-service support concept for defence equipment. Finally, nations and NATO bodies are only slowly adopting ‘best commercial practices’.

63. This is reflected in non-optimised logistics in the field. It is therefore necessary to improve this aspect of logistics in co-ordination with CNAD.

64. NAMSA and other NATO agencies can be considered as enablers, in the sense that they (can) provide a forum and programmes for a coherent development of logistics support, especially where production and consumer logistics tangibly meet.

65. At present there is no formal mechanism for sharing requirements or plans for logistics improvement initiatives. This is detrimental to the total effort, especially at a time when national initiatives impact heavily on co-operation and where perhaps a higher involvement of primarily multinational industry and the use of commercial best practises in tools and processes are required.

66. Within NATO, a mechanism for harmonisation, co-ordination and control would consist of a structure and of procedures.

67. At the moment SCs and SNLC are tasked with evaluating NATO’s logistic posture. The SCs execute this task within the framework of force planning, in which logistics is not very prominent. The SNLC holds this task "NATO wide", however, until now has not done very much about it. This is subject of a presently ongoing study of the AHWG on SNLC’s TOR.

68. The SNLC provides a pro-active forum for initiating and harmonising the development and implementation of logistic policies and initiatives, through consultation and co-operation among nations.

69. It is very likely that the efficient control of NATO logistics will require additional capabilities at the strategic and other levels.

70. Defence Planning is the system’s unique systematic reasserting of most key policy documents on a biannual basis. The defence planning procedure document CM(97)35 is too high a level to address co-operation in logistics, however, it introduces logistics as one of the seven defence planning disciplines.

71. At the moment there is no procedure for the logistics pillar of defence planning at all, contrary for instance to armaments and operational planning.

72. Therefore there is a requirement to review the logistics pillar of the defence planning process.

73. National and NATO logistic planning must be harmonised as early as possible during the defence planning processes so that potential for co-operation can be maximised. The focus should be on harmonisation with Force Planning. The Force Goals and the DPQs are good carriers for this. However, harmonisation should be enhanced in a wider framework as stated by DCI.

74. The PARP process, like Defence Planning, is defined in broad enough sense to include co-operation in logistics. The same arguments used for the Force Proposals also apply for Partnership Goals.

75. Mission related logistic force generation under peacetime conditions is an important aspect of planning for non-Article 5 operations. Therefore, logistic force requirements and potential for co-operation must be established at an early stage and in consultation with nations so that co-operative opportunities can be exploited.

76. Currently, the biggest problem is the (lack of) feedback. What feedback there is, is mainly on an ad hoc basis. There is no structured system for logistics auditing.

77. Part of the new approach to logistics should be benchmarking with other organisation. To demonstrate that joint and multinational co-operation in logistics is effective and saving costs for all the participants, performance indicators should be formulated and periodically measured.

CHAPTER 3 : CONCLUSIONS AND RECOMMENDATIONS

78. The pursuit of Logistics Co-operation in NATO is a continuing imperative. Effective communication, information and involvement of Nations are of fundamental importance.

79. A wide range of co-operative logistics initiatives already exists, and NATO has a number of major and far-reaching programmes in train or being developed. Guidance and direction from current NATO plans and policy documents for such co-operation is being followed, but implementation is often fragmented and inconsistent. The focus needs to be on looking ahead, seeking constructive long-term solutions and continuous improvement.

80. NAC principles and policy to enhance Co-operation in Logistics are therefore required. This would encourage NATO members, NATO bodies and Partner Nations to focus more clearly on the use and value of co-operation across the logistic chain. The overall aim is to develop a more coherent approach, improve decision-making, and provide for greater economies of scale.

81. Based on these NAC principles and policy, a NATO concept for co-operation in logistics should be developed to define the vision, means and appropriate control mechanisms. This will allow NATO and NATO member nations to implement the structures, systems and procedures enabling co-operative logistics to be identified, marketed, co-ordinated and managed effectively as a whole. Therefore there is a need for further work as envisaged in the TOR of this working group.

82. The SNLC is invited to:

82.1 Endorse the findings and conclusions of this report;

82.2 TASK the WG to continue into Phase 2 as envisaged in the TOR as follows (by april 2000):