Logistics modernization program: a cornerstone of Army transformation: what began as a plan to modernize Army supply chain management has evolved into one of the largest, fully integrated supply chain and maintenance, repair, and overhaul solutions in the world

Army Logistician, Jan-Feb, 2007 by Kevin Carroll, David W. Coker

Today, the Army is undergoing an exciting and dynamic transformation. While this transformation is driving the Army's evolution into an expeditionary force that is agile, versatile, and capable of meeting the challenges of the Global War on Terrorism, a similar revolution is occurring in the systems and processes that support and supply the warfighter.

The Logistics Modernization Program (LMP) is one of the programs that stands at the center of the Army's business transformation initiatives. The LMP is a cornerstone of the Single Army Logistics Enterprise--an enterprise business solution that will enable vertical and horizontal integration at all levels of logistics across the Army. By modernizing both the systems and the processes associated with managing the Army's supply chain at the national and installation levels, the LMP will permit the planning, forecasting, and rapid order fulfillment that lead to streamlined supply lines, improved distribution, a reduced theater footprint, and a warfighter who is equipped and ready to respond to present and future threats.

Logistics Modernization Program: History

Before the LMP was conceived, the Army Materiel Command (AMC) depended on ponderous, 30-year-old systems to manage its logistics operations and supply critical equipment and repair parts to the Soldier. These systems--the largest of which were the Commodity Command Standard System (CCSS) and the Standard Depot System (SDS)--evolved into a complex web of software solutions that were difficult to maintain and almost impossible to update to address the Army's rapidly expanding supply needs.

The lack of a single, unified supply system across the Army fostered an environment in which numerous organizations developed independent configurations of the CCSS and SDS, along with a wide variety of localized software applications designed to support those systems. As a result, the Army faced serious challenges in managing its supply chain and distribution infrastructure.

Because of the lack of financial integrity created by the lack of a single, unified system, it became clear that the Army would not be able to upgrade its legacy systems to comply with Federal directives such as the Chief Financial Officers Act of 1990 and the Federal Financial Management Improvement Act of 1996--laws that were enacted to increase the efficiency and visibility of financial operations across the Department of Defense (DOD). Along with these efforts, the Government Accountability Office published several reports that recommended consolidating DOD logistics infrastructure further and increasing privatization and outsourcing to bolster the efficiency of the Army's business operations.

Instead of embarking on a massive, customized software development effort that would produce a software solution for current conditions, but that perhaps would not be flexible enough to meet the needs of the future warfighter, the Army decided to implement a commercial off-the-shelf-based, best-in-class enterprise resource planning (ERP) solution to revolutionize the Army's national-level logistics systems and business processes. This solution is the LMP.

Recently, operational control for the LMP was placed under the Program Executive Officer for Enterprise Information Systems (PEO EIS), whose office oversees large systems integration projects Army-wide. The LMP's principal beneficiary, AMC, provides expertise in current and desired supply chain business practices to create a winning leadership combination for the program.

The leadership structure of the LMP includes the Deputy Chief of Staff, G--4, Department of the Army; the commanding general of AMC; and the PEO EIS. The Deputy Chief of Staff, G--4, is the Logistics Domain Portfolio Manager. In addition to collaborating with the Secretary of the Army, the program's leaders also work closely with the Business Transformation Agency, an organization established within the Office of the Secretary of Defense to oversee business transformation across DOD, in order to align the LMP closely with broader Army and DOD modernization goals.

Logistics Modernization Program: Today

The LMP has been fulfilling warfighter requirements on a daily basis since July 2003. Today, the LMP manages $4.5 billion worth of inventory, processes transactions with 50,000 vendors, and integrates with more than 80 DOD systems. The LMP is deployed to 4,000 users at the Army Communications-Electronics Life Cycle Management Command (C--E LCMC); Tobyhanna Army Depot, Pennsylvania; the Defense Finance and Accounting Service; and a dozen other Army and DOD locations. When fully deployed, LMP will support more than 17,000 logistics professionals.

The LMP delivers real-time situational awareness and vastly improved decisionmaking capabilities, and it has significantly reduced logistics operational costs where it has been deployed.

The LMP is one of the world's largest ERP implementations, leveraging the technology of ERP industry leader SAP to fully integrate the Army's supply-chain activities. These activities include sourcing and acquisition, production scheduling, order processing, inventory management, transportation, warehousing, and customer service. As a result, the Army is better able to adjust its logistics operations quickly to meet evolving needs.