Enclosure 1 Metris Plan Option.docx

13 April 2023 Enclosure 1 – Metrics Plan

INTRODUCTION

The Contractor’s performance will be measured by a Combined Material Availability (MA) with additional incentives for reducing Backorder (BO) age. The metrics shall be monitored by the Government and the Contractor throughout the life of the contract and shall be reviewed during the Performance Review Boards. The purpose of this plan is to define and establish the process by which the Combined MA and BO metrics are measured.

COMBINED MATERIAL AVAILABILITY METRIC

The Contractor will provide material availability to fill AH-64 and CH-47 Depot Operations at Corpus Christi Army Depot (CCAD) and DLA’s world-wide customer requisitions in accordance with the terms and conditions of the BCOI contract. Material Availability will be measured against Material Requisition Orders (MRO) filled denoted by Figure 1 below.

MRO (A) are the total qualified MROs released by the requisitioning authority. MRO (A) meets the metric when a requisition is filled by DLA or filled by the Contractor within the IPG timeframes defined in Paragraph 3.3.1. MRO (B) are requisitions filled by the DLA while MRO (C) are requisitions filled by the Contractor. The Government Enterprise Business System (EBS) shall be considered the System of Record for monitoring the applicable performance metric. EBS will utilize the data defined in Paragraph 3.3.1 and sent by the Contractor to establish the metric start and metric stop for each AH-64 and CH-47 requisition sent to the Contractor. Any errors, interruptions, failures, or defects in EBS may entitle the Contractor to corresponding schedule relief from the applicable metric. In the event the EBS system is unavailable, the Contractor execution system may be recognized as the system of record.

Figure 1. MRO Flow Diagram

OPERATING RULES AND COMBINED MATERIAL AVAILABILITY

Combined Material Availability The Combined Material Availability (Combined MA) metric is a combination of the Contract Material Availability (Contract MA) evaluation results of DLA Customer Requisitions that are filled by the Contractor, in accordance with the DLA PBL order fulfillment logic and timeframes specified later in this document, and the DLA Enterprise Material Availability (DLA MA) command metric results of DLA Customer Requisitions that are filled by a DLA Distribution Center. The Contractor Plant designation is “PSGQ.” Combined MA is further defined later in this document.

Requisition Operating Rules Customer Requisitions are defined by the following:

· Requisitions are defined as a request for a single part for any quantity.

· Customer requisitions, including unfilled requisitions (backorders), shall be satisfied in the order of the highest priority, then earliest Julian date of requisition, as required by the Uniform Material Movement and Issue Priority System (UMMIPS) OPNAV Instruction 4614.1 (latest revision), unless otherwise directed by DLA PCO.

· Qualified requisitions are requisitions that meet technical requisition requirements as defined below:

· Technical requisition requirements - Systematic checks verify that the message is complete and can be processed as defined in the Attachment 3 BCOI ICD (INTERFACE CONTROL DOCUMENT)

· The Contractor will perform Systematic checks to ensure that no technical requirements have been violated. If the systematic check determines that the technical rules have been violated, the Contractor will respond to DLA utilizing a 945A Warehouse Shipping Advice message with a status of “BD.” “BD” status is defined as: Requisition is delayed due to the need to verify requirements relative to technical data. Orders will remain “out of status” until such time as the technical requisition requirement has been corrected. The metric clock will not start while requisitions are in “BD” status.

· If the Contractor can demonstrate based upon conditions including but not limited to the following that the requisition was created in error:

· Excess quantities as defined in para. 3.3.3 (1)

· Demand signal disconnect (Customer orders material and the customer does not have a valid requirement for that material. Example: (Warner Robins orders an AH-64 and CH-47 National Item Identification Number (NIIN))

· The Contractor will place those requisitions in “BD” status and notify via email DLA PCO of reason why within one full Government business day of requisition receipt. DLA PCO will respond within one full business days of the Contractor’s notification. Upon notification, DLA PCO and the Contractor will complete the necessary forensics and DLA PCO will make one of the following three decisions:

· 1) Cancel the requisition in its entirety and remove the requisition from metrics in total, if applicable, or

· 2) Request the Contractor fill the order lead-time away and remove the requisition from the metrics in total, or

· 3) Fill the requisition because DLA does not agree with the assertion of an error and metrics will apply. The metrics clock commences upon notification from the PCO and subsequent change to the median status code.

· Cancelled Requisitions

· Qualified requisitions that are subsequently cancelled within the metric delivery timeframe will be considered an exclusion to the Contract MA calculation.

· Qualified requisitions that were identified by the Contractor to be in error that are subsequently cancelled prior to fulfillment will be considered an exclusion to the Contract MA material availability calculation. Partially filled requisitions that were identified by the Contractor to be in error where the unfilled quantity is subsequently cancelled prior to fulfillment will be considered a quantity change. These requisitions and will be counted under the Contract MA calculation based on the response time of the partial quantity fulfillment.

· Modified Requisitions

· If a Requisition Modification is requested by the Government and the Contractor accepts this modification, the Contractor will respond indicating its Modification Request Acceptance and restart the metric clock accordingly.

· If a modification is accepted then the Metric Start time for all applicable suffixes on the requisition will be reset using the timestamp sent by the Contractor in the 945A Modification Acceptance Transaction.

Contract Material Availability Definition and Calculation The following paragraphs provide the Contract MA metric definition and exclusions. Requisitions will flow to the contractor from DLA for all market basket part requirements however only Enclosure 1A part requisitions will be measured for Contract MA material availability performance.

Contract Material Availability Timeframe Definition Contract MA is defined as the Contractor having the ability to successfully fulfill MRO A requisitions in the timeframe allocated for their applicable Issue Priority Group (IPG) based upon the Priority Designator. The Contractor shall adhere to the Contract MA metrics described below. The Government shall be responsible for maintaining accurate Contract MA data in the EBS database. Qualified requisitions will be metric accountable when received on a business day during the following working hours: Monday through Friday from 06:00 Eastern time to 15:00 Eastern time (all times listed utilize a 24-hour clock). Federal holidays are not business days. Requisitions received after 15:00 Eastern time shall be considered received and metric accountable at 06:00 Eastern time on the following business day. Qualified IPG1 requisitions shall be received, processed and prepared for shipping 24 hours a day/7 days a week.

The IPG timeframe for requisition fulfillment is defined as follows:

· IPG I (Priority Designator 01, 02, and 03) = 1 Business Day

· IPG II (Priority Designator 04, 05, 06, 07, and 08) = 1 Business Day

· IPG III (Priority Designator 09, 10, 11, 12, 13, 14, and 15) = 3 Business Days

· FMS planned CLSSA = Applicable IPG timeframe referenced above PLUS one business day.

The Timeframe is calculated from the Metric Start and Metric Stop points in the COI PBL requisition fulfillment process as defined below:

Metric Clock Start

· Qualified requisitions will be metric accountable when received on a business day during the following working hours: Monday through Friday from 0600 Eastern time to 1500 Eastern time (all times listed utilize a 24-hour clock). Federal holidays are not business days. Requisitions received after 1500 Eastern time shall be considered received and metric accountable at 0600 Eastern time on the following business day. Qualified IPG I requisitions shall be received, processed and prepared for shipping material 24 hours a day/7 days a week.

· The Metric Clock Start Time will be established, documented and communicated in the Contractor’s response to the Material Requisition detailing that the material on the requisition is available or on backorder.

· Technical Electronic Data Interchange (EDI) Transaction and Data Element Definition:

i. EDI 945A Warehouse Shipping Advice Transaction

ii. Material Status Reported = “BT” or “BB”

1. Loop = 0311 Segment LQ, Data Element LQ01 = 81

a. Data Element LQ02 = Industry Code

i. BT = Requisitioned item is available

ii. BB = Requisitioned item is unavailable and is back ordered

iii. Metric Clock Start

1. G62 Segment, Position 110

a. G6201 (Date Qualifier) = BB

2. Metric Clock Start Date

a. G6202 (Date) = CCYYMMDD

b. G6203 (Time Qualifier) = W

3. Metric Clock Start Time

a. G6204 (Time) = HHMMSS

Modification Clock Start (Restart):

· If a Requisition Modification is requested by the Government and the Contractor accepts this modification, the Contractor will respond (EDI 945A) indicating its Modification Request Acceptance and restart the metric clock accordingly.

· Technical Electronic Data Interchange (EDI) Transaction and Data Element Definition:

i. EDI 945A Warehouse Shipping Advice Transaction

ii. Material Status Reported = “BK”

1. Loop = 0311 Segment LQ, Data Element LQ01 = 81

a. Data Element LQ02 = Industry Code

i. BK = Sales order has been modified as requested

ii. BB = Requisitioned item is unavailable and is back ordered

iii. Metric Clock Start

1. G62 Segment, Position 110

a. G6201 (Date Qualifier) = BB

2. Metric Clock Start Date

a. G6202 (Date) = CCYYMMDD

b. G6203 (Time Qualifier) = W

3. Metric Clock Start Time

a. G6204 (Time) = HHMMSS Metric Clock Stop

· Non-Critical Safety Items (Non-CSI): The Metric Clock Stop Time will be established, documented and communicated in the Contractor’s response to a Material Requisition detailing that the non-CSI material requested has been picked, packed and is ready for shipping instructions from Vendor Shipment Module (VSM). In situations where requisitions require multiple shipments, the clock stops when the final quantity of material is picked, packed and ready for shipping instructions from VSM.

· Non-CSI Technical EDI Transaction and Data Element Definition:

i. EDI 945A Warehouse Shipping Advice Transaction

ii. Material Status Reported = “BA”

1. Loop = 0311 Segment LQ, Data Element LQ01 = 81

a. Data Element LQ02 = Industry Code

i. BA = Item is being processed for release and shipment

2. W0601 (Reporting Code) = NL

3. G6201 (Date Qualifier) Position 110 = BB

4. Metric Stop Date

a. G6202 (Date) = CCYYMMDD

5. Metric Stop Time

a. G6203 (Time Qualifier) = W

b. G6204 (Time) = HHMMSS

· Critical Safety Items (CSI): The Metric Clock Stop Time will be established, documented and communicated in the Contractor’s response to a Material Requisition that indicates the CSI material requested has been picked and is available for Defense Contract Management Agency (DCMA) inspection. In situations where requisitions require multiple shipments, the clock stops when the final quantity of CSI material is picked and ready for DCMA inspection.

· CSI Technical EDI Transaction and Data Element Definition:

i. EDI 945A Warehouse Shipping Advice Transaction

ii. Material Status Reported = “BA”

1. Loop = 0311 Segment LQ, Data Element LQ01 = 81

a. Data Element LQ02 = Industry Code

i. BA = Item is being processed for release and shipment

2. W0601 (Reporting Code) = NL

3. G6201 (Date Qualifier) Position 110 = BB

4. Metric Stop Date

a. G6202 (Date) = CCYYMMDD

5. Metric Stop Time

a. G6203 (Time Qualifier) = W

b. G6204 (Time) = HHMMSS Metric Stop Time (Cancellations)

· Partially Filled Requisitions where the remaining quantity is cancelled:

i. EDI 945A Warehouse Shipping Advice Transaction for last filled portion of the requisition

ii. Material Status Reported = “BA”

1. Loop = 0311 Segment LQ, Data Element LQ01 = 81

a. Data Element LQ02 = Industry Code

i. BA = Item is being processed for release and shipment

2. W0601 (Reporting Code) = NL

3. G6201 (Date Qualifier) Position 110 = BB

4. Metric Stop Date

a. G6202 (Date) = CCYYMMDD

5. Metric Stop Time

a. G6203 (Time Qualifier) = W

b. G6204 (Time) = HHMMSS Contract Material Availability Data DLA systems of record provides primary source data for all Contract MA calculations. The Government shall be responsible for ensuring the accuracy of the data. The Contract Material Availability Calculation captures all MRO requisitions sourced to Boeing PLANT “PSGQ,” or DLA Distribution Center as defined in Figure 1. MRO A requisitions sourced to PLANT “PSGQ” are measured in accordance with timeframes defined in paragraph 3.3.1. MRO B requisitions sourced to DLA Distribution Center are measured in accordance with DLA Enterprise Material Availability logic. Combined MA is calculated as shown in Figure 2.

Suffixed MRO A requisitions are initially evaluated for Contract MA at the suffixed line item level, or children level. After each line item of a suffixed requisition has a definitive and reconciled status (i.e., MET, MISSED, or not Metric Accountable-closed), a parent requisition status is derived based upon the statuses of the children suffixed line items. If any children line item has a status of “MISSED,” the parent requisition is evaluated with a final status of “MISSED” regardless of the individual status of any other children line items for the same requisition. Any line item with a status beginning with “not Metric Accountable-open” will cause the parent to remain open and undetermined until all line items have a definitive status.

The parent status of MRO suffixed requisitions is used in the Contract MA metric calculation. Suffixed requisitions are included in the reconciliation for Contract MA metric in the month that the last line item is resolved as “MET” or “MISSED”.

Requisition line items that are cancelled before the fill due date as defined in paragraph 3.3.1 are not metric accountable. Requisition line items that are cancelled on or after the fill due date as defined in paragraph 3.3.1 are metric accountable.

Figure 2. Combined MA Calculation Exclusions Requisitions in the following categories will be excluded from Contract MA and Back Order metric calculations. However, if the Contractor fulfills an excluded requisition within the MA timeline, it will be included in the MA metric calculation.

1. If the contractor demonstrates excessive demand for NIINs affected by, for example: the results from Service/Inspection Bulletins, Analytical Condition Inspections (ACI)/High Flyer Program, Aircraft Structural Integrity Program (ASIP), and Technical Directives. Metric relief will be determined bi-laterally and documented via PCO correspondence. For the purposes of this clause, excessive is defined as: “going beyond the usual, necessary, or proper limit or degree.”

2. Exclusions due to excusable delays clause (H10).

3. Requisitions impacted when DLA inventory position provided in the Enclosure 3 (Government Starting Inventory) to the AH64 CH47 SOW has been depleted without a corresponding requisition to support the attrition per Attachment 44 AH64 CH47 SOW paragraph 2.0.

4. If the Government invokes its inspection rights, and government resources are unavailable (i.e. people, systems), and the contractor demonstrates it causes a delay, affected requisitions will be excluded. This includes requisitions with a CSI and GSI related delay.

5. Requisitions for obsolete/diminishing manufacturing sources (DMS) items or changes to government technical data for any requisitions received beyond existing on-hand and due-in shelf stock.

6. Requisitions exceeding MA timeframes due to Government direction to first satisfy lower priority or newer requisitions for the same material.

7. Qualified requisitions identified by the Contractor to be in error that are subsequently cancelled prior to fulfillment.

8. Requisitions received after contract award during the transition period.

9. FMS Unplanned CLSSA, Non-CLSSA, Initial Support, and FMS Direct Requisitioning Procedures (DRP) requisitions which will be filled no later than lead time away.

10. If a requisition is not satisfied within the IPG timeframes due to a government contract for non-Boeing material that is delinquent to the due-in dates defined in Enclosure 3 to the SOW by more than zero days, that transaction will be excluded from the MA metric calculation. In the event the delinquent contract quantity is less than the requisition quantity, the exclusion will only apply to the delinquent contract quantity. The difference is expected to be satisfied by the contractor.

Separate from any relief available to the Contractor pursuant to metric exclusions above, exclusions from the requisition metric count may also be granted at the discretion of the Government Procurement Contracting Officer (PCO) for good cause provided that substantiation and documentation is submitted by the Contractor demonstrating performance or schedule impacts outside of the Contractor’s direct supply chain control.

Annual Material Availability Reporting Periods The reporting schedule for the performance is annual and shown in calendar days within Figure 3. DLA Aviation - BAE is responsible for sending the Annual Performance Report to the Contractor within 60 calendar days of the end of the reporting period for reconciliation. The Annual Performance Review Board, jointly attended by DLA and the Contractor, will be held within 30 calendar days of the Contractor receiving the Annual Performance Report. All MRO requisitions are metric accountable 120 days after contract award, in accordance with Paragraph 19 of BCOI AH-64 and CH-47 SOW.

Figure 3. Performance Periods Reconciliation On a monthly basis, DLA Aviation - BAE will provide the raw data used in calculating the Contract Material Availability to the Contractor by the 21st of each month. Upon receipt of the data, the Contractor will perform a reconciliation of the data set to the Contractor’s system of record and provide a response of any disputed data or exclusion requests to DLA Aviation – BAE within 10 business days of receipt of the data. The data will be provided to the Contractor per H54 Data Clause on the BCOI Contract.

Contract Material Availability Performance Metric Requirements A Contract Material Availability baseline will be established using DLA historical performance of the material listed in the Enclosure 3 of the SOW. The Contractor’s performance fee per contract performance period is shown in Figure 4.

Figure 4. Material Availability Performance Fee

The Contractor will be required to incrementally increase MA to 90%. The Contractor will lose performance fee when combined MA performance fails to meet stipulated thresholds. Performance fee decrements are calculated as follows:

To compute the MA performance metric, see Figure 5 below for combined MA performance requirements, and if appropriate the applicable incentive decrement.

MA metric computation example:

Incentive computation as follows:

MA Performance Requirements

Figure 5. Material Availability Performance Requirements

Additional notes:

• 100% of MA fee is provided to the contractor each month, and an adjustment is made at the end of the performance period if the contractor does not perform at the 0.0% decrement level.

• DLA Aviation will determine the actual initial MA baselines and expected contractor annual improvements to be mutually agreed.

BACKORDER INCENTIVE

The Backorder (BO) incentive is incentivized over and above the Fixed Price Incentive (FPI) metric geometry of Material Availability (MA) and cost performance and is calculated separately. DLA and the Contractor have mutually established a performance baseline using valid historical data over a time period agreed upon prior to award. The BO incentive will not be priced in the Boeing AH-64 and CH-47 contract. The BO metric only applies to on-contract NIINs (Enclosure 1A of the SOW).

Backorder Age Definition For the purposes of this plan, a backorder is a MRO assigned a status of “BV” with a SGQ RIC beyond the MA response timeframes specified in paragraph 3.3.1; or a MRO assigned a status of “BV” with a create date prior to on metric date as identified in SOW Enclosure 1A; or a status of “BB” in the Contract Profile Report (DRU-14849) for on-contract NIINs. Backorder Age is measured in calendar days from the Sales Order create date in EBS to the date the Contract Profile Report is created. Backorder analysis is done monthly using the Backorder worksheet from the Contract Profile Report (CPR), DRU-14849, that was created on the first calendar day of the next month, which contains statuses as of the last day of the previous month due to a one-day lag in the source tables. If a CPR is not available on the first day of the next month, then use the last available CPR completed in the month being evaluated. The following steps provide guidance on how to calculate the age of eligible backorders to be used in determining the Backorder Incentive:

1. Filter the data on CLIN Group Name (GROUP_NAME) equal to or beginning with “TELSS.”

2. Filter the data on Sales Order Document Type (SO_DOC_TYPE) equal to “TA,” “ZRET,” or “ZPPD.”

3. There are three categories of eligible orders. Each category requires a separate filter step to capture the correct data set of Backorders:

a. Contractor filled orders that did not meet Timeframes and have status “BV” -

i. Filter the data on Sales Order Item Status Code (SO_ITM_STAT_CD) equal to “BV” and Sales Order Supply Plant (SO_ITM SUP_PLANT) equal to “PSGQ.” Set this group of orders aside as data set #1.

ii. Working with data set #1 and using the most recently reconciled Contract MA metric status at the parent level, flag orders that did not meet the Timeframes as defined in Para. 3.3.1 (missed Contract MA) at any time in the past. Filter on the orders that are not flagged (met Contract MA) and delete them from the data set so that only those orders that did not meet the Timeframes remain.

b. Contractor filled orders that were inherited upon award, were created prior to award, and have status “BV” – Filter the data on Sales Order Item Status Code (SO_ITM_STAT_CD) equal to “BV,” Sales Order Create Date (SO_CREATE_DT) prior to Award Date, and Sales Order Item Supplying Plant (SO_ITM_SUP_PLANT) equal to “PSGQ.” Set this group of orders aside as data set #2.

c. DLA-filled orders with status “BB” - Filter the data on Sales Order Item Status Code (SO_ITM_STAT_CD) equal to “BB” and Sales Order Item Supplying Plant (SO_ITM_SUP_PLANT) not equal to “PSGQ.” Set this group of orders aside as data set #3.

d. Combine data sets #1, #2 and #3.

4. Compute the Backorder Age by subtracting the Sales Order Create Date (SO_CREATE_DT) from the date of the last day in the month being evaluated. Use this age value to compute the following data elements used in the Box and Whiskers chart:

a. Minimum used for bottom whisker

b. Maximum used for top whisker

c. 1st quartile used for bottom of box

d. 2nd quartile used for middle of box

e. 3rd quartile used for top of box

5. Adjust for KO/PCO approved exclusions.

Backorder Count Definition Backorder Count is used in the Backorder Incentive calculation, and therefore is tracked monthly and plotted on the Backorder Box and Whiskers chart. Backorder Count is derived from the same CPR and Backorder worksheet used for the Backorder Age calculation. Backorder Count is equal to the count of Backorders on hand with Sales Order Status Code equal to “BB” and “BV”.

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4.1.

4.2.

4.3. Demand Count Definition

Demand Count is used in the Backorder Incentive calculation, and therefore is tracked monthly and retained for annual metric performance evaluation. Count of total qualified demands for on-contract TELSS NIINs is derived from the Combined MA analysis, which is used for determining the status of orders filled by a DLA Plant.

1.1.

4.4. Backorder Incentive Reporting

Because the Backorder Age calculation for the purposes of building the Box and Whiskers chart relies upon reconciled Contract MA statuses, this metric is dependent upon the completion of the Contract MA analysis. DLA Aviation – BAE will provide a draft monthly Backorder Box and Whiskers chart by the end of each month for reconciled and unreconciled data through the end of the previous month, and indicate on each chart which months have unreconciled data. The Contractor will review the data and provide any responses or challenges back to DLA Aviation – BAE within 10 business days after receipt. DLA Aviation – BAE will provide a final Backorder Box and Whiskers chart at the end of each contract performance period in accordance with paragraph 3.4 Annual MA Reporting Periods after the performance period Contract MA reconciliation process is complete. A sample Box and Whiskers chart with notional data is shown in Figure 6.

Figure 6. Sample Backorder Incentive Box and Whiskers Chart.

1.2.

4.5. Backorder Incentive Opportunities

The Contractor can earn an additional Incentive Fee by reducing the Backorder (BO) Count and Age. BO Baseline Improvement is the percent (%) reduction from the established BO baseline. The initial BO baseline is documented in Figure 7 below. The requisition baseline is the total number of requisitions received by DLA for Enclosure 1A NSNs during the previous 12 months. An Incentive Fee is first obtained when total BOs are reduced and again when the any of the three quartile Age categories are reduced. BO baselines and reduction thresholds for earning BO incentives are shown in Figure 7.

Monthly BOs

Notes

· All annual reductions based on corresponding, specified initial baseline values

· No Age Quartile fee will be awarded unless the annual total BO reduction percentage is first met

· Using the specified initial baseline BO Count to determine required reductions is valid only if the number of requisitions received by the Contractor during a contract performance period is within ± 5% of the initial baseline total requisition count

Figure 7. Backorder Incentive Measurement

Using the baseline total BO count to determine the required total BO count reduction is contingent upon the number of requisitions received during a contract performance period. If total requisitions received by the Contractor increases or decreases more than 5% of total requisitions received during the period used to determine the baseline BO quantity, the BO baseline will increase or decrease by the equivalent percentage of requisitions received.

For example, assuming the Contractor receives 2000 requisitions and 200 BOs in contract reporting period 1 and the baseline was based on 1000 requisitions and 100 BOs, this would equate to a 100% increase in requisitions received. Since this falls outside the allowable 5% range, it necessitates an increase to BOs by an equivalent 100%.

Figure 8. Backorder Incentive Available Fee 1.3.

1.4. Examples for Backorder Incentive Metric

Example 1.

· Incentive fee for the period equals $1,000

· Baseline BOs at the start of year 1 is 1,500

· At the end of the period the contractor obtains the following results:

· Age of the 3rd Quartile is reduced by 11%

· Age of the 2nd Quartile is reduced by 12%

· Age of the 1st Quartile is reduced by 5%

· Total BO Count annual average reduced by 2%

Result: No fee is awarded because the contractor did not reduce overall BOs by at least 5%

Example 2.

· Incentive fee for the period equals $1,000

· Baseline BOs at the start of year 1 is 1,500

· At the end of the period the contractor obtains the following results:

· Age of the 3rd Quartile is reduced by 7%

· Age of the 2nd Quartile is reduced by 14%

· Age of the 1st Quartile is reduced by 15%

· Total BO Count annual average reduced by 14%

Result: The contractor would receive fees of 0% for the 75th quartile, 25% for the Median quartile, 25% for the 25th quartile, and 25% for reducing total BOs Count.

Fee Computation: 0 + 25% + 25% + 25% = 75%; 0.75 x $1,000 = $750

MATERIAL AVAILABILITY UPSIDE INCENTIVE

The Material Availability (MA) upside incentive is incentivized over and above the Fixed Price Incentive (FPI) metric geometry of Material Availability (MA) performance fee and cost performance and is calculated separately. DLA and the Contractor have mutually established an incentive baseline for earning additional incentive for achieving higher MA levels than required by the FPI calculation. The MA upside incentive metric applies to all the NIINs included in Enclosure 1A of the SOW. This incentive will be authorized and funded under a separate CLIN on the -002U contract.

5.1 Material Availability Upside Incentive Opportunities

The Contractor can earn an additional Incentive Fee by increasing the MA above the required baseline shown in Figure 5 - Material Availability Performance Requirements. The MA will be calculated as outlined in Paragraph 3. The incentive fee requirements are documented in Figure 9 below.

Available MA Incentive Fee

Total Available MA Incentive Fee = $5,200,000

Total Available MA Incentive Fee = $TBD

Figure 9. Material Availability Incentive Available Fee

GLOSSARY

1.1 511M Requisition Modification The 511M Requisition Modification transaction is used to convey the request to modify a previously received requisition

· Include DLA material on order for wholesale stock locations

· Exclude DLA material on order for IMSP locations except for MRO order at IMSP location

· Exclude DLA material on order for FMS orders

· Exclude DLA material on order from DVD Remodel

· Exclude DLA material on order for customer direct requirements

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