U.S. Army Materiel Command (AMC) Modernizes Logistics Capability by Outsourcing to CSC.
Client: Army Materiel Command (U.S.)
Challenge: To modernize logistics automation support capability, consisting of 2,200 legacy applications and 50,000 professionals.
Solution: CSC implemented best practices, installed new technology, and helped guide AMC through the organizational and process transformation.
Results: AMC is now enjoying significant new benefits and improvements as the organization makes use of the modernized logistics system, as well as $8 million in cost reduction during the first two years.
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The Logistics Modernization Program is a landmark for military logistics and supply chain management. Read how the LMP supports US troops from factory to foxhole.
Learn about CSC's supply chain management practice.
When the U.S. Army Materiel Command (AMC) contracted with Computer Sciences Corporation (CSC) to modernize its logistics automation support capability, it initiated the first government contract in which both modernization and day-to-day operations were outsourced to one IT services provider, CSC. Though the Logistics Modernization Program (LMP) required extensive business process reengineering and commercial-off-the-shelf technology, two essential components of its success were organizational and cultural—the human factor.
A bold approach
AMC today is comprised of approximately 50,000 logistics professionals who manage and supply the weapons systems and commodities — artillery, tanks, aircraft, missiles, ammunition, field electronics and chemical and biological weapons protective gear — essential to readiness and success in war. Over the years, AMC’s logistics system had evolved into a complex web of more than 2,200 legacy applications. Despite the systems' inefficiencies, AMC employees, many with more than 20 years experience, were comfortable with the old processes and procedures. In order to update its logistics system, AMC decided on a bold approach: outsourcing the design, implementation and day-to-day operations of a new logistics system that included best commercial practices and commercial-off-the-shelf technology. For the modernization effort to be successful, a broad organizational transformation strategy was necessary to assess all issues and concerns.
Personnel as the key
The first step in Team LMP’s organizational change strategy was to retain and prepare all of the AMC employees whose positions were to be outsourced to CSC. These employees then implanted the LMP solution, based on commercial-off-the-shelf technologies using SAP’s merged public sector and defense industry modules. In addition, extensive training of AMC-LMP users was carried out.
Early results
As a result of Team LMP’s organizational change strategy, the early phases of deployment have been successful. AMC is now enjoying significant new benefits and improvements as the organization makes use of the modernized logistics system. During the first two years of the contract, the improved processes and procedures generated approximately $8 million in savings, which the team was able to reinvest in the modernization effort.