Postal Service to use SAP

SAP America Inc. won a $35 million contract to replace the U.S. Postal Service's 25-year-old human resources software.

The contract covers $14 million in license and maintenance fees for the MySAP Business Suite and $21 million in services from the company's professional group.

Postal officials hired SAP's professional services group to oversee the transition to a new HR system. The postal agency will run the new software on mainframe Z990 processors and Linux SUSE, both from IBM Corp.

With 700,000 employees, USPS represents a sizeable but not unprecedented win for SAP. In July, SAP won a U.S. Army contract for an undisclosed amount. SAP will supply logistics software for the U.S. Army's Global Combat Support System Project.

SAP, whose parent company is based in Germany, is one of the largest vendors of integrated software applications known as enterprise resource planning systems.

In a statement about the new contract, Robert Otto, USPS' chief technology officer, said the new HR system would, among other things, "provide management with the flexibility to manage and control costs."