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SAP Delivers for the Mailman

Neither rain nor sleet nor gloom of night can keep the U.S. Postal Service from its appointed rounds, but a 25-year-old Human Resources software system is apparently stopping the mailman in his tracks.

So the USPS said this week that it is turning to SAP to replace the aging software that was developed internally to manage its more than 700,000 employees -- one-third of the civilian workforce of the federal government.

The estimated $35 million contract is split up into $14 million for the mySAP Business suite and standard maintenance agreement and a $21 million consulting contract with SAP's Professional Services division to install it.

The Postal Service said it selected SAP after it spent several years assessing the functional, technical and Web-enabled capabilities of SAP software. Neither the Postal Service nor SAP would comment on which other companies had been in the final running for the bid. SAP has found itself in a virtual dogfight with other ERP vendors like PeopleSoft and Oracle to supply customers with Human Resource Management (HRM) or Financial Management Services (FMS) tools.

SAP said it has a leg up on the competition since it had successes with some 50 other postal organizations around the world, and knows how to upgrade systems while protecting a company's existing technology.

"Postal organizations like the U.S. Postal Service can develop a high-performing workforce, improve productivity and control costs by leveraging workforce planning solutions from SAP to recruit, train and track employees while improving the skill mix of its employees, and providing managers with access to tools for proper planning," Steve Peck, president of SAP Public Services, said in a statement.

As part of its selection of mySAP Business Suite, the U.S. Postal Service also licensed SAP NetWeaver application platform to analyze information throughout the organization in order to identify problem areas, train and support mail carriers, while maintaining high-quality customer service.

"The desired result of the project is to leverage technology to provide more value to our most valuable asset, our employees. The software will also provide management with the flexibility to manage and control costs," USPS chief technology officer Robert Otto said in a statement.

No timelines were disclosed for the project.