I got asked a question the other day that intrigued me. And as longtime readers probably guessed – I decided to play with some numbers and see where they led.
The particular question was in the context of a military logistics contract. The question was, in effect, “How much money would DoD save by doing that with military labor”?
Obviously, I don’t have the specifics of that contract. But I decided to make a couple of assumptions, then “run the numbers” for a contrived but IMO reasonably representative example to see where the numbers led.
As that example, I chose a warehouse operation – two shifts, with 3 nominal 7-person teams (team lead plus 6 workers each) and a shift lead for each shift, plus a warehouse supervisor and his/her deputy. (Let’s call the teams on each shift “receiving”, “warehousing”, and “shipping”.) I then assumed military and civilian staffing and compared costs.
Since costs vary by region and the logistical contract in question was in the “South”, I assumed the location was in the vicinity of Fort Bragg, NC.
The military staffing for the operation I assumed was as follows:
- OIC: 1 ea O-2, 3 yrs TIS
- NCOIC: 1 ea E-7, 14 yrs TIS
- Shift Supervisors: 2 ea E-6, 9 yrs TIS
- Team Leaders: 6 ea E-5, 5 yrs TIS
- Team Members: 18 ea E-4 (3 yrs TIS), 18 ea E-3 (2 yrs TIS)
I further assumed the OIC, NCOIC, Shift Supervisors, and Team Leaders were all married; that the Team Members were 50/50 split married/single; and that all lived “on the economy” (e.g., received housing allowance and separate rations). This was necessary because – unlike civilian industry – military personnel costs vary depending on whether or not an individual is married.
