REDACTED_JA21-020 MOD02 SAP MaxSecure.pdf

FY 21 SAP MaxSecure Support Services – JA21-020 MOD 02

CUI

of effort.

MOD 01: The purpose of this modification is to increase the level of effort required for SAP MaxSecure Support Services. Navy Enterprise Resource Planning (ERP) requires the Technical Refresh for SAP MaxSecure Support Service. Navy Enterprise Business Solutions (PMW 220) is responsible for sustaining the Navy ERP system. SAP Enterprise Central Component (ECC) is nearing obsolescence and faces end-of-life in 2027. The Navy can maintain SAP ECC through 2030 using extended maintenance. Given the size and scope of the Navy ERP installation, Program Executive Office Manpower, Logistics and Business Solutions PMW 220 must immediately begin a technical refresh to replace the SAP ECC component with SAP S/4HANA Cloud. This technical refresh will be conducted by PMW 220 under the Naval Enterprise Business Solution project. The total estimated cost for the technical refresh to replace SAP ECC component with SAP S/4 HANA Cloud service is . FY23 Operation and Maintenance funds will be used for this increase level of effort. The PoP remains unchanged.

Original J&A: The nature of this action is to issue a sole-source firm-fixed price contract for SAP MaxSecure support services to SAP National Security Services (SAP NS2), a large business. The PoP is for a 12-month BP, and will include three, 1-year option periods. FY 21 Operations and Maintenance funds will be used for this procurement. The total estimated cost is . The applicable North American Industry Classification System Code is 541519, other computer related services.

3. DESCRIPTION OF SUPPLIES/SERVICES: This J&A authorizes and approves the issuance of a sole source contract for SAP MaxSecure Support Services. MaxSecure support is an annual commercial-off-the-shelf maintenance/support subscription service in support of SAP Software. The SAP MaxSecure service contract will provide the Navy Enterprise Resource ERP program with rapid response to support requests involving SAP. The service will provide critical resources whose sole focus will be to understand the Navy ERP system and quickly react to any issues related to the software affecting the production system. This critical support will minimize downtime and impacts to the user base for the Navy ERP enterprise business system. Other requirements include assistance in standing up a certified Navy ERP SAP competency center and recommendations for improvements within the Navy ERP SAP system with regard to system performance. Description of the specific support services include:

(a) SAP Government Support and Services (GSS) Secure Back Office Infrastructure and Remote

Support: With standard SAP maintenance under the software license, customer messages may be viewed and addressed by SAP global support, without restrictions. When connection is needed to the licensee network in cases where login is required for problem resolution, licensee requires that login can only be performed by Department of Defense (DoD) cleared resources over an approved communication channel that terminates in the continental United States (U.S.). Under this requirement, SAP GSS provides this secure channel and maintains a controlled area from which the secure connection will terminate in a GSS-provided, or, if agreed, a licensee-provided, personal computer (“PC”). This PC shall contain and be prepared to run the agreed upon and licensee-provided Client Virtual Private Network software, which will enable the SAP GSS secure connection to the licensee solution.

(b) SAP GSS On-Site Technical Quality Manager: Includes, but is not limited to:

(1) Full understanding of the U.S. Navy solution, security, business processes and landscape to be able to address top issues proactively.

(a) Description of events.

In December 1998, the Secretary of the Navy Revolution in Business Affairs Commercial Business Practices Working Group established four ERP pilot programs as enablers for reengineering Navy ERP business processes. Each Navy pilot program focused on selecting a commercial ERP product that contributes to the Navy’s mission. During these pilot programs, the Navy considered SAP, Oracle and PeopleSoft as candidates for the Navy ERP solution. These four ERP pilot programs each independently selected the COTS vendor SAP as the system ERP solution.

Since 1998, the Navy’s estimated total investment in these four pilot programs was approximately

. In 2003, the Assistant Secretary of the Navy-Research Development Acquisition directed the convergence of the pilot programs to standardize business processes on a Navy-wide basis and chartered the Navy ERP Program Management Office to oversee the acquisition and fielding of a Navy-wide ERP implementation using the SAP solution. The Navy ERP Program includes and expands upon the functionality implemented in the original pilot projects. SAP provides unified business processes and automated information systems supporting material management, plant maintenance, wholesale supply, financial management, program management and workforce management. In 2004, the Navy began to develop an ERP system that was built using SAP ERP core software products. The only authorized MaxSecure reseller and proposed sole source contractor, SAP NS2, has been providing the required MaxSecure support since 2008. The Navy’s ERP system uses core integrated software products from SAP to support its solution. The specialized support provided by SAP NS2 ensures the sustainment of the Navy ERP’s SAP integrated software products continues to be managed by the highest skilled technicians. To this end, the Navy has relied on the use of SAP MaxSecure in order to effectively execute the Navy ERP mission since 2008. The use of the MaxSecure approach to onsite total quality management has resulted in rapid responses to all Navy SAP product issues including providing exceptional performance improvements to the overall Navy ERP system, both of which have resulted in increased productivity to Navy ERP end users.

(b) Justification.

(1) Minimum Government requirements. In order to prevent a break in service of critical support for the Navy’s SAP-based ERP system, MaxSecure support is required to be in place by January 18, 2021. Because the Navy requires MaxSecure support and SAP NS2 is the only reseller of the MaxSecure support. SAP NS2 remains the sole source provider of the required services.

(2) Proposed sole source contractor. SAP NS2 has been the incumbent contractor and sole authorized reseller providing the required MaxSecure support since 2008 across multiple contracts as discussed in the procurement history (paragraph (a) of section 11) below.

SAP NS2 does not authorize any resellers or channel partners to provide the required services in support of their software, as discussed further below. Failure to award a sole source contract to SAP NS2 for MaxSecure support would result in substantial duplication of costs for the Navy to acquire and/or develop a new ERP system and cause a potential break in current service. Moreover, a switch to a new ERP solution would require redevelopment of the existing SAP software infrastructure, resulting in an unacceptable delay in fulfilling the Navy’s requirement in addition to duplication of cost.

A reinvestment into a different software suite would be cost prohibitive. Procuring alternative software would cost at least , to replace the existing ERP solution and implement similar product support, assuming a similar pricing structure (e.g.

licensing, support, etc.) as that for SAP software. However, this cost does not include the investment required to transition existing data to a new format, re-developing the solution using the new software; performing regression testing; and implementing, deploying, and re-training the workforce. Based on the time to initially deploy the Navy ERP system (2004-2007), it would take a minimum of four years to fully deploy an alternate solution.

The Navy could also incur a break in service during the four years it would take to transition to a new ERP solution based on an alternate software product, the current system would be unsupported.

(3) Discussion regarding cause of the sole source situation. The Navy’s ERP software is based on SAP integrated software products and the software licenses have been acquired through SAP. As such, the maintenance support required for this software must be SAP-based. This support is provided exclusively by SAP NS2, the only SAP MaxSecure reseller. Moreover, the Agency confirmed that SAP NS2 is still the only organization that is authorized to deliver the MaxSecure service, no other providers are authorized to resell MaxSecure support. As such, SAP NS2 is the sole source for providing the required MaxSecure support. The current service agreement for MaxSecure support expires on January 17, 2021, so the new agreement must be in place by January 18, 2021 to avoid a break in coverage. Thus, this effort is a continuation of the service currently being provided by SAP NS2. As long as the Navy fields a SAP-based ERP system, support for SAP products will be required. Until SAP NS2 authorizes other resellers or channel partners to provide the required support for their products, this company will remain the sole source provider of MaxSecure support.

(4) Impact. Navy ERP is a mission essential business system currently supporting approximately 71,650 end users across multiple Navy Commands: Naval Air System Command, Naval Supply Systems Command, Naval Sea Systems Command, Space & Naval Warfare Systems Command, Strategic Systems Program Office and Office of Naval Research. Navy ERP is considered the Navy’s financial system of record and responsible for all the Navy’s managed materials. Navy ERP directly supports the war fighter by ensuring the efficient and timely appropriation, tracking and deployment of supplies. Without access to the level of support provided by SAP MaxSecure, the Navy will lack the dedicated support and SAP direct access necessary to resolve problems that may arise with the Navy ERP System in a timely manner.

Additionally, the financial posture of the Navy would be jeopardized and its ability to support the warfighter would be compromised. Given the business-critical role of the Navy ERP system and the significant investment and reliance by the U.S. Navy, it is imperative that the availability of the system not be in question. A critical component of the solution to ensuring the continuous delivery of ERP services is the sustainability of the application configuration and the underlying business data. Therefore, failure to provide the required SAP Max Secure support will result in mission failure.

(5) Justification for Bridge Extension (MOD 02). The continuity of these services is vital to the warfighter. Preparation and review of the follow-on requirements documents, to include funding, were on hold until late November 2025 due to Department of Government Efficiency (DOGE) review and discussions. In the interim, it is vital to execute this bridge extension to keep these services unending. Without the access to the level of support provided by SAP MaxSecure, the Navy will lack the dedicated support and SAP direct access necessary to resolve problems that may arise with the Navy ERP System in a timely manner.

6. SAM.GOV ANNOUNCEMENT/POTENTIAL SOURCES: A synopsis for this action will be published on the SAM.GOV website, as required by FAR 5.201. The synopsis will completely identify the Government’s minimum mandatory requirements.

7. DETERMINATION OF FAIR AND REASONABLE COST: A price analysis will be conducted

TECHNICAL CERTIFICATION: I certify that the supporting data under my cognizance which are included in the J&A are accurate and complete to the best of my knowledge and belief.

NAME: SIGNATURE: See separate signature page

TITLE/ORGANIZATION: Assistant Program Manager - Contracts (APM-C), PEO-MLB Front Office/Navy ERP

PHONE:

REQUIREMENTS CERTIFICATION: I certify that the supporting data under my cognizance which are included in the J&A are accurate and complete to the best of my knowledge and belief.

NAME: SIGNATURE: See separate signature page

TITLE/ORGANIZATION: Program Manager, Navy ERP Financial IT Services (PMW220)

PHONE:

CONTRACTING OFFICER CERTIFICATION: I certify that this justification is accurate and complete to the best of my knowledge and belief.

NAME: Kailee Rickhoff SIGNATURE: See separate signature page

TITLE/ORGANIZATION: Contracting Officer/DISA/DITCO/PS8312

PHONE: 667-890-8897

PROCURING ACTIVITY COMPETITION ADVOCATE APPROVAL:

NAME: Andrea Horstmann SIGNATURE: See separate signature page

TITLE/ORGANIZATION: Procurement Analyst/DISA PSD

PHONE: (667) 890-0841

ALL QUESTIONS REGARDING THIS JUSTIFICATION ARE TO BE REFERRED TO Kassie Hund, 667-890-9027, kassaundra.l.hund.civ@mail.mil.