Air Force Commodity Councils: Leveraging the Power of Procurement

Abstract

The United States Air Force is always looking for ways to improve practices while leveraging the taxpayers dollar. The Air Force currently spends about one-third of its annual budget on purchased goods and services. This offers the Air Force a large target in which to seek cost savings. Commercial firms have moved toward a commodity-council approach for purchasing in recent years, and the cost reductions realized have been impressive. Findings have shown that the increased leverage from commodity councils will optimize buying power for the Air Force, reduce duplication of effort, improve customer support, and minimize supply-chain costs through integration and collaboration. Commodity Council is a term used to describe a cross-functional sourcing team designed to create a centralized purchasing strategy and establish centralized contracts for enterprise-wide requirements. The commodity council drives commonality and standardization and ensures the leveraging of purchasing volume. The key to this approach is to rely on market experts in the specific commodity category to make well informed, market-savvy decisions that fully meet all enterprise-wide requirements for a commodity. A "commodity" is simply defined as a segmentable category of goods and/or services. Note, this definition does not imply an expendable or non-complex item (Hansen 1). In this research, I analyze the experiences of the newly-formed Air Force Information Technology Commodity Council (AFITCC) at Headquarters Standard Systems Group (HQ SSG or SSG), Maxwell Air Force Base (MAFB) Gunter Annex, Alabama, for results and lessons learned.