DP3 – A moving industry conundrum | RELO Roundtable...a gathering place

DP3 – A moving industry conundrum

Managing Expectations: SDDC's challenge for relocating military service members

shellgame DP3 – A moving industry conundrum The U.S. Air Force published a new piece at their official website entitled Realignments add to busy summer moving season. The article addresses concerns about a “busier-than-usual military moving season” that is “about to kick into high gear”.

Officials from the military Surface Deployment & Distribution Command (SDDC), the executive agent for the Department of Defense's (DOD) new household goods personal property procurement program, DP3, are apparently asking service members to book their moving dates early and to and to “keep flexibility in mind when doing so.”

Hmmm. …

Managing PCS Expectations

The way that the Defense Personal Property System (DPS) is set up, service members and their families required to undertake a domestic or international permanent-change-of-station (PCS) move each year can't register in SDDC's automated new self-counseling move management system until they receive their transfer orders.

According to the article, John Johnson, SDDC's chief of personal property, said the military moves about 600,000 shipments a year, and more than a third of those moves take place over the summer.

"The biggest challenge is expectation management," … "Moving in the summer season is already difficult, and most people are set on moving on holiday weekends. It's always a challenge when volume exceeds capacity. We need to ensure we have enough trucks and crews to move people." – John Johnson – Chief of Personal Property, SDDC

It seems like DOD's own logistics arm could do a much better job managing their service members 'expectations', then, especially if the bottleneck to the moving industry's shrinking capacity problem is exacerbated by the overwhelming surge of 200,000 late breaking military shipments whose owners all want to move at the same time as everyone else in the country.

This could be more easily accomplished internally by SDDC's program administrators by simply requiring each of 10 branches falling under the United States Transportation Command to schedule transfers and release PCS orders according to a more organized, well developed coordinated DOD transfer policy and uniform relocation process.

Instead the administration of USTRANSCOM's $2 billion dollar DP3 relocation program will be left to the scheduling whims of over a quarter of a million service members and their families this summer using the system resources (and limitations) built into the military's unfamiliar and difficult to navigate personal property shipping portal at www.move.mil.

You have to wonder what happens when things don't go as planned. Do these customers blame the military or their mover for their relocation woes during what's expected to be an extremely challenging peak moving season.

Reduced claims! Fact or Fiction?

For months SDDC has been telling the domestic and international moving associations and the select group of transportation service providers (TSP) they've chosen to negotiate with that missing item and property damage claims filed under the new DP3 program have been significantly less than under the old household goods procurement programs.

In the Air Force article, however, Mr. Johnson hints that service members using the new features at the military's DPS portal “ran into a few stumbling blocks along the way”. He cited the electronic claims process as an example.

Supposedly the location of the "submit" button on the new electronic claims form was the reason that some disappointed (and, understandably, disgruntled) PCSing service members missed the 75-day filing deadline for receiving claim compensation allowed under DP3's new full-value protection liability provisions.

Interestingly this admission comes months AFTER the moving industry started working on their transportation rate matrices and local contractor and hauler negotiations in preparation for the first full year of experience under the new DPS rules. This suggests that the rates filed in good faith for the latest DP3 business cycle may not reflect the actual cost to participating TSPs to administer claims under SDDC's secretive new 'best value' procurement system.

This late breaking news, of course, has a tremendous negative financial impact on the reduced compensation that could be paid to – and then taken away from – the thousands of small businesses that rely on the military PCS business each season to survive. That list, unfortunately, includes many of the local agents, independent owner-operators, potential new driver recruits; and third party service contractors who are excluded from participating or protecting their financial interests under DPS's restrictive new business rules.

Container Controversy

Mr. Johnson also uses the AF article to reassure service members receiving PCS orders that the SDDC has supplemented their normal manpower and equipment requirements by allowing participating TSPs to use “multiple types of [commercial] containers” to “increase the capacity of carriers qualified to conduct military moves.”

The containerization of household goods into some of the new mobile/portable storage and transportation options available in the moving marketplace is a wise concession that the military should have made years ago.

Unfortunately, the ownership and administrative control for the use of this additional moving and storage industry capacity is at the local level for most TSPs. Last minute notice of SDDC's administrative concession came so late, however, that many companies were not able to negotiate competitive pricing arrangements for the local use of the agents manpower and equipment before peak season plans were made.

Many container owners and operators are understandably leery of SDDC's cheap 'best value' pricing encouraged under DP3. Instead most will elect to use their manpower and container capacity on a more profitable customer or client relationship during the critical peak volume moving season between April and August.

Coming Down the Stretch

This will be the second year that the military has operated under the new household goods procurement processes built into DP3. Six hundred thousand anxious and inexperienced relocating military service members are hoping the government got it right this time.

So far, it seems, the moving industry doesn't appear quite as convinced of it's success as the SDDC administrators are.

While it's true that the Department of Defense controls the personal property program's purse strings, its the shrinking group of independent household goods van operators and local moving and storage agents that they're contracted to who control most of the industry's manpower and equipment capacity. So far, however, no one at SDDC has solicited their professional input.

Whaddya think? Take the poll. Post your comments. Share your thoughts!

Military hints at review of problem-ridden DP3 program – RELO Roundtable

‘Defense Personal Property Procurement Program (DP3)’ Category – RELO Roundtable

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