1LMX is a business and digital transformation effort that is enhancing the speed, agility, insights, and competitiveness of Lockheed Martin. By leveraging data as a strategic asset, enabling a model-based enterprise that spans the full product value chain, and streamlining systems and processes to both grow and run the business, Lockheed Martin is forging a more resilient, secure and modernized supply chain for the United States’ defense industrial base.
Building on the decades-old relationship between the companies, Lockheed Martin is leveraging the RISE with SAP solution to expand its enterprise cloud capabilities and introduce the tools needed to implement core business processes in managed FedRAMP-compliant cloud environments through the 1LMX initiative. In addition, Business Technology Platform (BTP) will provide Lockheed Martin with a secure innovation platform on which to develop emerging technologies. The SAP Analytics Cloud solution will enhance its strategic data management and analytics objectives.
RISE with SAP will bundle the applications, platforms, tools, and services necessary to enable business process innovation for Lockheed Martin, identifying efficiencies and supporting Lockheed’s vision to provide enterprise interoperability in support of meeting the needs of the government, defense, and aerospace markets. RISE with SAP will shift the company’s ERP software systems to S/4 Hana Cloud and will significantly expand Lockheed Martin’s use of SaaS products from SAP in the areas of business technology platform, intelligent spend, human experience management, digital supply chain, and several others.
I’ll bet Lockheed ends up running for the hills . Since they will be using RISE under US Fedramp controls, they will be using SAP’s US subsidiary NS2 as the RISE managed service provider. NS2 was running the SAP workloads for the US Army and US Navy which are two of the largest SAP ERP customers in the world. The scuttlebutt in the DOD community is that both NAVY and ARMY took back management of their SAP systems from NS2 due to high pricing and multiple technical delivery issues causing performance and availability issues.
This is quite an interesting discussion! The same thing is also being discussed in Europe and consists of two aspects: external costs with a provider and loss of internal knowledge from former IT employees. SAP is a successful commercial company and not an ERP auxiliary. When SAP recognizes a dependency, it starts to raise prices and reduce performance to increase profit (margin). If an SAP customer migrates to a provider (outsourcing, hosting, or cloud computing), they lose some of their sovereignty over their ERP system. If, at the same time, their IT department is also reduced, which is often the goal of the RISE transformation to the cloud, then the SAP customer also loses knowledge and competence. Now the customer is in a double dependency: through the ERP system with a provider, and through the fact there are no IT employees to provide further negotiations and functional enhancements. It seems that the navy and army have now recognized this painful dependency on SAP NS2.