IBM and Norwegian Armed Forces Sign $48 Million Contract on Integrated SAP Management System

IBM and Norwegian Armed Forces Sign $48 Million Contract on Integrated SAP Management System

The Norwegian Armed Forces and IBM (NYSE: IBM) signed a contract earlier this week for the continued development of a Joint Integrated Management Information System for the Armed Forces. The project is called The Economy project. The contract includes solutions for accounting, management and logistics, based on SAP. The value of the IBM contract is 300 million NOK or $48 million at today’s rates, including VAT. The Norwegian Parliament unanimously approved the Government’s proposal to go ahead with the project on December 15, 2006.

The project is scheduled to be completed one year from now, and to be applied on the fiscal year 2008. The present project is a follow-up of IBM’s delivery of a SAP-system for accounting and pay that was successfully completed on time and on budget in 2003. The Armed Forces started the integrated project in 2002 in order to coordinate the development and implementation of a joint administration system for all branches of the Armed Forces. When completed, the Norwegian Armed Forces will have a complete system for the administration of personnel, finances and materials.

The implementation of a joint integrated system will give significant efficiency yields from improved processes, simplified organization and a uniform administration of operations. “The delivery of the present Economy project is of high importance to the Defence Forces. It is a prerequisite for operating in an effective manner that we have a complete system supporting our management processes,” said Chief of Defence Staff, Lieutenant-General Arne Bård Dalhaug.

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