Logistics to boost defense business

The Defense Department will spend $6.8 billion in 2004 on information technology to improve logistics — the fastest growth area for vendors in jobs and money, the Government Electronics and IT Association (GEIA) said this week.

Logistics — the planning, shipping and delivery of food, water, shelter and warfighting materiel to troops deployed or in combat overseas — represents a boon next year for vendors because of military transformation efforts and lessons learned from this year's operations in Iraq, said George Shaw, an industry official who led GEIA's forecast of DOD's 2004 operations and maintenance budget. Shaw was speaking at the association's 2003 Vision Conference.

GEIA, an industry lobby group, annually predicts U.S. IT and defense electronics spending for the upcoming fiscal year and the next four years after interviewing government officials.

About one-third of DOD's 700,000 employees support logistics. Vendors in 2004 can reap more jobs as the military outsources work done by civilian employees, and can win more contracts at the department continues to automate logistics, said Shaw, a Raytheon Co. official.

DOD improved upon paper-based logistics used during the Gulf War in 1991, when thousands of cargo containers arrived in Saudi Arabia unmarked, requiring troops to open each one to determine their holdings. U.S. military personnel in Iraq started embedding electronic tags in containers that can be read like bar codes using a handheld device or automated scanning system, but supply piles still occurred.

Gen. Paul Kern, the Army's top materiel officer, speaking Oct. 7 during the Association of United States Army's 2003 Annual Meeting, showed a picture of wooden supply boxes in Kuwait spray-painted with their units' names. Kern said the military must improve logistics so the right materiel more easily gets to the right troops.