On the defence

Military manoeuvres: A number of logistics companies have experienced success in the defence sector
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As pressure mounts on the defence sector to improve its operational efficiencies, could the logistics industry play a role in boosting the military supply chain?

he continued dominance of security issues in global politics has highlighted the importance of smooth operations within the defence sector, where nothing is left to chance. At present, one of the greatest challenges in sustaining a military campaign is the maintenance of uninterrupted supply chains, regardless of fluctuations in the political climate.

Despite the obvious difficulties this scenario presents, who better to advise on well-organised and implemented supply chains than the logistics industry itself?

“The efficiency of defence logistics relies on flexibility and remaining responsive in the face of a turbulent world,” says Michael McGill, director of defence logistics at IQPC, a global business intelligence company with offices in Dubai.

“Like other government sectors looking to iron out their inefficiencies, the defence industry has found a place for the commercial world in its military operations. Contracting out logistical support is fast gaining popularity and luring the big players into the defence logistics market.”

In particular, the prevailing security situation in the Middle East has increased the urgency of rapid response in defence operations. By building a closer relationship with the private sector, the region has been progressively adopting the joint-service logistics concept.

“As the requirements of the modern military change, particularly those peacetime reactive forces such as the UAE, there will be a greater need to rely on industry to ensure increased operational capability,” agrees McGill.

“This means ensuring that the logistics functions are operating seamlessly in terms of information management and increasing the supply chain visibility to provide effective distribution and support.”

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A boom in regional defence spending has been the driving factor behind increased military-industry partnerships in the GCC countries. Therefore, as governments continue to recognise the benefits of outsourcing military logistical operations, McGill expects there will be a windfall for the private sector.

“I feel that as awareness of what solutions are out there grows, the regional defence forces will be looking to develop new partnerships,” he says. “This will provide a unique opportunity for local and international defence contractors.”

One of the first major logistics players in the region to capitalise on this lucrative niche is Agility. “With billions allocated annually to private contractors, the Middle East defence logistics market is exhibiting tremendous potential for contractors,” concurs Tarek Al Mousa, the company’s regional executive director in the Middle East. “The potential of new cost-saving logistics practices has resulted in the increased outsourcing of operations by governments and military forces.”

With the military recognising the importance of outsourcing its core activities to large and experienced contractors, Al Mousa believes the sector has been pleasantly surprised by improvements in operations.

Indeed, Agility’s positive experience to date has led to the establishment of its defence and government services (DGS) division. With access to more than 550 offices in 100 countries, Agility DGS combines a vast network of warehousing facilities with risk-tolerant global land, sea and air transportation capabilities.

“In the Middle East, Agility provides regional governments with the neccessary supply chain capabilities to support and augment the logistical requirements of their armed forces,” explains Al Mousa.

“These global services include transportation, freight management and warehousing services, catering and food service solutions, in addition to bulk fuels and liquid distribution.”

Additionally, Agility procures, manages, stores and distributes every consumable item the armed forces need to operate, including food, clothing, medical supplies, general and industrial supplies, power and aviation support.

The company’s defence contracts include the high-profile Subsistence Prime Vendor Programme, which handles procurement, shipping, warehousing and distribution of food and supplies to US military facilities throughout Iraq. It also handles many smaller, highly-specialised defence logistics solutions, such as Heavy Lift, a transportation solution for general cargo, heavy machinery and equipment, and DDKS, a spare parts distribution centre in Kuwait.

Al Mousa strongly agrees that awareness is increasing as to how the private sector can bring proven logistics experience and unique capabilities to the global defence industry. “Governments around the world must constantly ensure that their armed forces can accomplish their intended missions and are ready to meet whatever need arises,” he observes.

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