The government funding mechanism doesn’t incentivize cost optimization, and in my experience, does the opposite. Money is allocated to be spent and if not spent is “lost” and may be cut from subsequent budget years. This leads to massive end of year purchases to use remaining funds or starting unnecessary projects just because money was allocated, regardless of whether needs have changed.

It’s a really broken system that no one seems interested in fixing.

Does it relate to this report in some way? https://apps.dtic.mil/sti/pdfs/ADA393599.pdf

Authored by Joseph W Kernodle of CLEMSON APPAREL RESEARCH.

Similar story in Denmark. The army got a new procurement system, based on SAP, to help reduce cost. I believe Paul-Henning Kamp has a joke in a talk where he claim that they succeeded, because nobody could buy anything for a year.

Later I meet a former procurement officer who was reprimanded for excess purchases in the year leading up to the system launch. In the end his team was the only one able to provide equipment for an extended period of time after the new system was introduced. Everyone else had relied in JIT supply chains, but this guy didn't believe that the new system would work and spend a year building up inventory.

Are there any documents supporting this? I ask because I am curious what official documents exist around this idea of mandated return to inefficiency -- there must've been a gain elsewhere (or is that too optimistic)? Plus there must be costs documented associated with the first and second program. Genuinely curious about this type of decision (call it "inefficiency thrash"?).

SAP, and any other ERP, is just the operating system for your organization. If you run it intelligently, the OS won’t prevent you from getting a good outcome.

In this case, it sounds like they should’ve bolted the JIT platform onto SAP

I'd have thought that the US army would be using its own solution, or at least an American one. Using a foreign made platform to handle such a critical aspect of your military (logistics) sounds a bit weird. Not that I think that those risks, if they even exist, haven't been thoroughly evaluated by tons of experts in the army!

SAP sucks for custom stuff like uniforms and clotes.

I developed a custom engine for things like aluminium rails, and thermal sensors, to generate a new product with the production tree in SAP, so it would be able to decrease the right ammount of raw materials from the warehouse.

I remember years ago a friend worked for sun, involved in SAP installs. He said corporations would overpay to install the highest-end (overpriced?) sun systems to get SAP up and running. Apparently the cost savings of something like currency conversions alone would pay for everything almost immediately. And that was just one facet - other efficiencies (taxation?) would have similar savings.

It doesn't make sense for the Army to be in the business of developing software. They should be outsourcing this, and having a well-known vendor like SAP means there's a lot of different avenues to get bids to lower prices.

I wonder how much of a kickback that general got for insisting on it.