Army says logistics IT system has saved at least $6 billion

There have been, sadly, more than a few cases in which the Defense Department has sunk seven or 10-figure sums into enterprise IT systems with little to show for it.

On the other hand, there are examples like the Logistics Modernization Program, in which the Army has already saved more money by implementing the system than what it’s  spent so far and what it will cost to keep it going for the next decade.

Army officials acknowledge that they hadn’t done the greatest job of articulating LMP’s financial benefits during the first decade of what’s expected to be a $4 billion program that started in 2003 and that the Army expects to continue through 2026, as the Government Accountability Office noted in a 2013 report.

But in an interview first aired Friday on Federal News Radio’s On DoD, they said the system, which helps manage the workflow of the sprawling maintenance and manufacturing network overseen by Army Materiel Command eliminated $2 billion in costs to maintain the 40-year-old IT systems LMP replaced; it’s also cut $4 billion in “spare” parts that it turns out the Army doesn’t actually need.

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(Editor’s note – Lt. Col. Robert Williams, the product manager for LMP and Joshua Call of Army Materiel Command will field your questions in a free online chat on Wednesday at 1:30 pm EDT.)

“It has let us make the right decisions on divesting our inventory. We’re still providing the right parts where soldiers need them,” said Joshua Call, the chief of AMC’s supply chain management division. “Some of that was linking together what had been our legacy systems to get a clear picture of what our inventory posture is on any given day, but we also have a view into our contracting processes so that we can see when new procurements are going to be delivered, when the items that are out for repair are going to come back, when all of the items that are in transit are going to be delivered to our customers. An item manager at, let’s say, Tank Automotive Research, Development and Engineering Center can see the worldwide status of all of his logistics assets in one place.”

LMP – an Army-tailored version of commercial-off-the-shelf logistics software produced by SAP, is now into its second increment. The Program Executive Office for Enterprise Information Systems in charge of delivering the technical bits of the system, which got DoD approval for full fielding in March.

The current iteration extends the enterprise resource planning system’s functionality to tens of thousands more users, most of whom are front-line artisans and machinists rather than the high-level managers who had mostly used the system for budgeting and planning, said Lt. Col. Robert Williams, the LMP product manager within PEO-EIS.

“We’re now taking these capabilities to streamline and automate our business processes down to the shop floor,” Williams said. “They’re using LMP in support of detailed production activities, and we’re now managing about seven million transactions a day.”

Much of that work is happening via the recent deployment of mobile devices distributed to workers at 50 Army depots across the country, where the Army is deploying WiFi infrastructure, tablets and barcode scanners to replace the mountains of paper that used to be necessary to specify and then document each turn of a screw on a helicopter, a truck or a tank.

“Before, if you were at the depot Corpus Christi, Texas and you were taking apart a Blackhawk helicopter for an overhaul, that was all done manually: the engine goes through various work centers, the rotor blades go somewhere else, and a lot of people touch those components and use a lot of new parts before it comes back together into a Blackhawk at the end,” Williams said. “You can imagine the stack of paper as that process goes on. We’ve eliminated that with automated technologies so that all the labor, the parts consumed, the financials that link to all of that are all inside LMP, and you only have a couple pieces of paper moving around with barcodes that link back to all this information.”

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