Description
Organization: NAVAIR, NAWC, China Lake
Team Name: Small Procurement Electronic Data Interchange (SPEDI) Team
Related Acquisition Topic(s): Cycle Time Reduction (CTR), Integrated Digital Environment (IDE), Paperless Contracting, Simplified Acquisition
Description:
SPEDI was developed in the late 1980's as one of several initiatives designed to solve what was then considered as one of the most pressing problems at the Weapons Center, the long lead times being experienced in small purchases. The average time from initiation of a request to receipt of the item was 95 days. The SPEDI system has proved itself many times over as a means for better service for end users and buyers, paying vendors faster, reducing inventory and lead times, getting rid of paper, and saving time and money. SPEDI is more than a computer application for buying items. It is a complete process that focuses on what is important to the end users while incorporating electronic commerce tools and smart application systems. The goal of SPEDI is to make the buying process simple, accurate, timely, and auditable using cost effective and host portable tools. For SPEDI contract items, NAWCWD has reduced lead times from 95 days to between one and five days, depending on the commodity; moved to paper-less proof of delivery; reduced payment time from 30 days to less than 10; reduced the average administrative cost associated with each purchase from $233 to $97; and, enjoyed quantity discounts of 10 to 70 percent. In addition to the below description, an eight-minute video (which provides an excellent overview of SPEDI) is included with this submission.
In 1998, SPEDI demonstrated that the system could be deployed in a multi-site environment along with a continued push to enhance the system. Enhancements have included areas such as the joint project with DFAS to introduce computer to computer payment processing. These system enhancements represent significant steps toward meeting the Department of Defense's goal of totally paperless acquisition. The criteria of simplifying the acquisition process, re-engineering the acquisition process and electronic data interchange/electronic commerce apply to this nomination.
SPEDI is a fully operational order management system featuring Internet based on-line catalogs. Orders are placed and confirmed via American National Standards Institute's (ANSI) X12 Electronic Data Interchange (EDI) data interchanges. Material is delivered with bar coded labels and tracked through final receipt. It is an Evaluated Receipt System (ERS) activating vendor payment via Electronic Funds Transfer (EFT).
The SPEDI system is built around a central relational database management system (Ingres) and applications that function as an information hub, exchanging and combining data with a variety of systems using application-specific electronic data feeds, ANSI X12 data feeds, and direct connections. The system includes a number of checks, validations, and automated functions that eliminate data entry and paper processes while providing control and accountability. The system generates a wide variety of receiving, delivery, invoice, audit, tracking, history, performance, costing, and management data and reports.
The SPEDI database supports hundreds of thousands of line items that reflect many different commodity types. It includes information specific to each item, and when available, pictures provided by CD-ROM. New catalogs and catalog updates are fed electronically to SPEDI by E-mail or FTP exchange. Vendors can send these directly or use third party catalogs as specified in site-specific contracts for catalog data. When they are received. SPEDI performs data checks and edits to screen out errors before the database is updated. Future integration of the EDI 832 Price/Sales Catalog transaction set will provide an additional data feed solution.
Vendors can inspect their own on-line catalogs via the Internet. Access is controlled by specific IP address authorization built into SPEDI, as well as the host site's firewall and Secure Socket Layer (SSL) encryption.
SPEDI vendors must be capable of receiving as EDI 850 Purchase Order transaction set, generating an acceptable 3 of 9 bar code label, and sending an EDI 856 Ship Notice/Manifest. NAWCWD provides an EDI and bar code information package for the vendors to follow to ensure consistency. SPEDI uses established, long-term systems contracts that are competitively awarded by the local site.
Electronic exchanges between SPEDI and local financial and accounting systems are site-specific, and may be either flat file data or EDI transaction sets.
The tracking data collected and stored in the SPEDI system includes: order placement, order transmission to vendor, order shipment from vendor, order receipt, order loading and order delivery. These steps are traced from the point of receipt through delivery via bar code scanning. From this data, the system generates receipt and invoice data that accounting and finance use to authorize payment to the vendor. The data collected provides the tracking, audit, and vendor performance information needed for management control and reporting.
The system employs industry standard Internet browser software, with encryption, as the Graphical User Interface (GUI). As part the user exchange with the system, SPEDI performs checks and validations before an order can be placed. Among the validations performed are Job Order Numbers (JONs), user authorization level, and final delivery destination. User authorization levels can be used to control the purchase of specific items, such as hazardous materials.
The various SPEDI system interfaces, checks, and processes were developed as functional modules using Inges relational database management system. This allows the system to easily adapt to changes, additions, new data feeds, or new requirements.
SPEDI was successfully implemented at the Weapons Center and has been in production since October 1990. However NAWCWD, given funding cutbacks, could not afford to continue to fund the required enhancements to the system. The SPEDI office began to look for external sponsors. The Smart Base Project Office (OPNAV N46) recognized the potential of SPEDI and, in May 1997, selected SPEDI as Smart Base initiative. Smart Base provided funds for a developmental effort to demonstrate multi-site applicability of SPEDI. In 1998, SPEDI connectivity between the China Lake hub and geographically remote sites was established. NAS Lemoore is operational on the West Coast. NAS Brunswick and NSY Portsmouth are operational on the East Coast. SPEDI is also currently working with the Defense Finance and Accounting Service to implement a computer to computer "lights out" payment process. It is anticipated that the payment process will be operational by early summer of 1999.
Efforts are currently underway to move program management of SPEDI to Navy level to accommodate enterprise wide utilization of SPEDI. It appears the EA-21, Electronic Acquisition in the 21st Century, part of the Navy's Paperless Acquisition Office, will accept SPEDI as an initiative and assume program management responsibilities.
