TFD Group became a California Corporation in September, 1976 under the name The Assessment Group. Its original charter was research in the area of defense economics. Initially the group included the entire staff of the Systems Planning and Economics Division of Technology Service Corporation, a RAND spin-off devoted largely to radar design and related signal processing subjects. Located in Santa Monica, TAG, as it was called, carried out a series of research contracts for the U.S. Navy Bureau of Personnel, helping to develop a methodology capable of influencing the capital/labor ratio of new Navy acquisitions, ultimately leading to the development of what became the EDCAS model (Equipment Designer’s Cost Analysis System). A significant body of work was also published dealing with the true cost of manpower at a time when little was known on the subject since the US DoD had just entered the era of the all-volunteer force. Labor supply elasticity studies were also delivered with the objective of determining appropriate reenlistment bonuses.

In 1985 a new business, Systems Exchange, was founded based on the idea of taking software prototypes that had been developed under contract and converting them to commercial use. The EDCAS model typified this endeavor. The first user licence of EDCAS was sold to Herr Degenhart of Krauss-Mafei, the German manufacturer of the Leopard tank. Degenhart’s computer operations, supported by a small Munich firm named OBS, became the European representative for Systems Exchange. Kurt Schaefer, the head of OBS was an energetic and effective marketing representative and was able to designate EDCAS as the official LCC/LOR tool for the nascent Eurofighter program in late 1987.

Ultimately, that position led to a total of about 250 license holders in the four participating nations (Germany, UK, Italy and Spain). Meanwhile, sales had begun in the US as well. In August, 1986, Robert Butler, Director of Systems Exchange, met Gerry Perlmutter, President of Logistic Engineering Associates. They agreed to market their products (EDCAS and an LSAR package called DILSA) jointly, after forging a data interface between the two. This idea, the integration of two different logistic analytical processes, was quite revolutionary at that time and attracted a great deal of attention, making both firms very successful. Systems Exchange hired its first salesman, John Sterling, in 1987.

By the early 1990’s, Systems Exchange had developed additional products – the System Design Utility (SDU), R1 (a reliability prediction package) and VMetric for spares optimization, in cooperation with Craig Sherbrooke, the VMetric engine’s author. We were also hard at work developing our ideas about a central, “common source,” database that would feed all the applications we developed and make a central analytical data hub into which any new application or data source could be plugged. This became the TFD Database. The success of our venture in Germany, and an association with someone well-connected in the Venezuelan Ministry of Defense led to establishment of a Systems Exchange-LEA joint venture in Caracas called Prolojer SA.

A group of programmers were, by 1992, working in an office we had established in Fairfax, California, just north of San Francisco. Around this time, a number of natural and man-made disasters also occurred in Los Angeles – the Northridge earthquake, a huge fire in Malibu and the Rodney King riot – all contributing to a desire to leave Los Angeles behind. Thus, we moved the company to Pacific Grove to remain close to the Naval Postgraduate School in Monterey, where Butler frequently gave lectures on logistics and cost analysis. As part of the move, we brought all the employees together in Pacific Grove and closed the office in Fairfax and renamed the company TFD Group.

Starting with the work in Germany, overseas operations of the company had always been aggressive. During the five most active years working with OBS, Butler (and occasionally Perlmutter) gave about 30 seminars on logistic methods in Munich, several in the UK and a number of them in South Africa. Butler and Perlmutter went to Australia in this period and began a business with the RAAF (Royal Australian Air Force) that ultimately encompassed some 30 sites between EDCAS and VMetric, and another 5 sites of EDCAS in Singapore.

A lecture delivered at Whitehall in 1995, ultimately led the RAF to become interested in the TFD Database, which still only existed in a primitive state. A visit by Wing Commander Julian Thompson, commanding officer of LARO (Logistic Analysis and Research Organization) led to the first purchase of the database, called the TFDdB. The visit was also significant because Wing Commander Thompson brought his database consultant with him, Kevin Griffiths. After listening to the first day’s presentations and asking a few questions the next morning to confirm his overnight excitement, Griffiths, by noon the following day, had an agreement to establish and manage TFD Services Ltd.

Later in 1995, we established TFD Asia Pacific with a recently retired Group Captain of the RAAF as managing director. Following this move, TFD no longer maintained our relationship with Logistics, Pty., with whom we had been working up to that point. However with the consolidation of the Australian defense industry, by 1998 there were only two active sites left in the region. This led to TFD Asia Pacific’s eventual consolidation. More importantly, this move transformed the role of our managing director to that of Chief Scientist. A role he excelled at throughout his tenure with TFD.

A phone call in 1996 led to a contract with Avondale Shipyard in New Orleans requiring TFD Group to fulfill the proposal requirements they faced for life cycle cost analysis on the LPD 17 proposal. During the next four months the lights never went out at TFD’s offices. There was a total of 35 designs for major ship equipments that we had to produce LCC estimates for. These included the main propulsion engine, reduction gears, propeller and generator sets. The work necessitated consultation with all the competing vendors for these equipments, gathering and vetting data submissions and running the model. Originally we thought the EDCAS model would do for the analysis. It quickly became evident, however, that EDCAS, basically an electronics model at that time, would not be useful for analysis of largely mechanical equipment. The first version of the MAAP model was hastily built to carry the load. Despite the pressures, the effort was supremely successful. Our final report, published unedited, was designated by both the Navy and the GAO as the discriminator in the award. The award of $9 billion to Avondale was fully $1 billion more than Litton Pascagoula (the favored contractor). While TFD Group was never thanked by Avondale (quite the contrary), we came away with a ground-breaking modeling technology that still remains at the forefront of logistic methodology.

In 2000, TFD Group began working with airlines after a chance encounter with a group of supply people from Canadian Airlines. VMetric was adapted to the specific airline environment (route flying, maintenance-capable bases, frequent schedule and route changes, different measures of effectiveness) and verified utilizing several airlines’ data.

During the next several years, TFD Group built or added to a number of tailored decision support systems. The first of these was called JCAPS and was designed by Richard Gunkel of Northrop Grumman’s Joint STARS program and Butler. The center piece of JCAPS (Joint Cost and Performance System) was MAAP, which provided the ability to trade-off cost and performance and the TFD Database, which formed the analytical core of the data repository. The design of this system was largely responsible for winning the Total System Support Responsibility contract on the Joint STARS aircraft. This was one of the most successful PBL contracts undertaken by the USAF during the first wave of performance agreements. The JCAPS system led to award of JCAPS 2 in support of a similar contract for the B-2. Unfortunately, the B-2 contract was far less comprehensive (and remains so) and the focus of attention was supply chain management, rather than complete support. During this effort, TFD Group developed the first version of Support Chain Optimization (SCO). Because of the constant turmoil in the inventory management system design and interfaces SCO depended on there, the general design and approach of SCO was improved upon before implementation on the Sentry aircraft support contract by AAR, and is presently being finalized for use on the Global Hawk program.

In 2006 TFD Group was awarded a contract by MTU to develop a model variant of MAAP called SIM. The idea of SIM was to provide detailed operational and maintenance planning to the EJ200 (Eurofighter) jet engine support program. Development of SIM took several years, but finally produced a cutting edge tool capable of more precise demand forecasting for all support resources than anything devised before. With a pipeline to serial number data, the model is able to deal, not with average values for crucial values such as time on wing, but with complete population distribution data for the same variable. The consequence is extreme accuracy in resource requirement forecasting and a commensurate decline in the cost of delivering high grade support.

Today TFD Group continues to develop new products and expand its user base around the world. During four years of market exploration and preparation in Japan, a major partner there has been developed and become capable of delivering joint services and technical support to a wide variety of both public and private clients. New initiatives in Korea, Taiwan, China and Singapore are also bearing fruit and a new liaison with GAINSystems in the US and GAINS Research Australia promise to restore that market place and open new avenues of expansion in commercial markets.