IBM will help Aussie warfighters keep track of their bullets, after winning a Au$95.5m ($67m/£54m) contract to implement an enterprise resource planning (ERP) system for the Australian Department of Defence.
This is just the first phase of the contract, and it could end up being worth as much as $1bn – the DoD has broken the project into several "tranches", something that will help avoid the kind of debacle that manifested in the US around the Pentagon's joint enterprise defence infrastructure (JEDI) contract, a single supplier agreement potentially worth up to $10bn over 10 years.
The Defence ERP program is the largest ICT project to be ever undertaken by the Australian DoD. The department says it will affect every Defence member and "transform the way Defence does business."
Besides IBM, organisations bidding for the contract included professional services biz Accenture.
ERP is a catch-all term used to describe software that automates management of business processes – everything from customer services, to accounting, to procurement, sales and distribution. The Australian military has already chosen German software haus SAP as its ERP software provider.
Eventually, the department will use the platform to manage its finances, human resources, logistics, engineering, maintenance and estate.
The Australian DoD plans to roll out initial capability for finance reporting in 2020, followed by a larger logistics and maintenance capability in 2022.
As part of "Tranche 1", IBM will be tasked with designing the initial deployment framework and providing system integrator services. It will also be responsible for plugging enterprise logistics and land materiel maintenance functions into the SAP platform.
The contract also covers high-level design for subsequent ERP tranches, and the foundation elements for later addition of finance and human resources management functionality.
Adoption of new software tools to increase efficiency is part of the Defence reform agenda, which was outlined in a policy document called the First Principles Review of Defence [PDF], commissioned in 2014 and published in 2015.
In 2018, IBM signed a deal to provide hardware, software and cloud services to the Australian federal government, worth as much as $1bn over five years. The agreement included the DoD as a potential customer, alongside the Department of Human Services (DHS), the Australian Taxation Office (ATO) and the Department of Home Affairs (DHA).
"This agreement is a testament to our 40-year partnership with the Australian government," David La Rose, managing director for IBM A&NZ, said at the time. ®