SAP filed a formal bid protest against the US Air Force's decision to award an $88.5 million contract to Oracle.
The multiyear software and services contract is for the Air Force's Expeditionary Combat Support System, a new system intended to replace legacy applications with one integrated procurement and supply-chain management system.
SAP filed its bid protest last week with the US Government Accountability Office (GAO). "According to the written evaluation issued by the US Air Force after award of the contract, SAP far exceeded Oracle in the required mission capability criteria and was rated the lowest risk offer," SAP said in a statement. "SAP also believes that it presented the U.S. Air Force with the most realistic cost to support the program."
Oracle's triumph over SAP had surprised some analysts. "We thought SAP was in a strong position to win this business, given its strength in logistics and previous wins in both Army and Navy logistics," Morgan Stanley analyst Ross MacMillan wrote in a note to clients.
GAO regulations require the contracting agency to file a report on the protest within 30 days of notification about the dispute. GAO is supposed to issue a decision on the protest within 100 days. In some circumstances, it can require the contracting agency to suspend work and payments under the contract until a decision is issued.