Space Acquisitions
DOD Poised to Enhance Space Capabilities, but Persistent Challenges Remain in Developing Space Systems Gao ID: GAO-10-447T March 10, 2010The majority of large-scale acquisition programs in the Department of Defense's (DOD) space portfolio have experienced problems during the past two decades that have driven up costs by billions of dollars, stretched schedules by years, and increased technical risks. To address the cost increases, DOD altered its acquisitions by reducing the number of satellites it intended to buy, reducing the capabilities of the satellites, or terminating major space systems acquisitions. Moreover, along with the cost increases, many space acquisitions are experiencing significant schedule delays--as much as 8 years--resulting in potential capability gaps in areas such as missile warning, military communications, and weather monitoring. This testimony focuses on (1) the status of space acquisitions, (2) causal factors of acquisition problems, and (3) efforts underway to improve acquisitions. In preparing this testimony, GAO relied on its body of work, including GAO reports on best practices, assessments of individual space programs, common problems affecting space system acquisitions, and the DOD's acquisition policies. We have made numerous recommendations to the DOD in the past on matters relating to overall best practices as well as on individual space program acquisitions. DOD often concurred with our findings and recommendations and has efforts underway to adopt best practices.
A long-standing problem in DOD space acquisitions is that program and unit costs tend to go up significantly from initial cost estimates, while in some cases, the capability that was to be produced declines. This problem persists. However, DOD has made progress on several of its high-risk space programs and is expecting to launch new generations of satellites across various missions over the next 12 months that should significantly advance some capabilities, particularly protected communications and space surveillance. While DOD is having success in readying some satellites for launch, other space acquisition programs currently in development face challenges that could further increase costs and delay targeted delivery dates. Another risk facing DOD space programs over the next few years is the potential for launch delays because of changes being made in the launch sector and an increase in the demand for certain DOD launch vehicles. Our past work has identified a number of causes for the cost growth and related problems, but several consistently stand out. First, on a broad scale, DOD starts more weapon programs than it can afford, creating a competition for funding that encourages low cost estimating, optimistic scheduling, overpromising, suppressing bad news, and, for space programs, forsaking the opportunity to identify and assess potentially more executable alternatives. Second, DOD has tended to start its space programs too early, that is, before it has the assurance that the capabilities it is pursuing can be achieved within available resources and time constraints. This tendency is caused largely by the funding process, since acquisition programs attract more dollars than efforts concentrating solely on proving technologies. Third, programs have historically attempted to satisfy all requirements in a single step, regardless of the design challenge or the maturity of the technologies necessary to achieve the full capability. DOD has been working to ensure that its space programs are more executable and produce a better return on investment. Some actions DOD and others have adopted or are pursuing include: the Acquisition Improvement Plan, which lists five initiatives for improving how the Air Force obtains new capabilities; changes in cost estimating that are in line with earlier GAO recommendations; and the Weapon Systems Acquisition Reform Act, which was signed into law in May 2009. However, there are still significant changes to processes, policies, and support needed to ensure reforms can take hold. Recent studies and reviews that have examined national security space have all found that diffuse leadership has a direct impact on the space acquisition process, primarily because it makes it difficult to hold any one person or organization accountable, and there is no single authority to resolve conflicts among the many organizations involved in space programs. Moreover, DOD continues to face gaps in critical technical and program expertise for space. Until both issues are resolved, commitment to reforms may not be sustainable.
GAO-10-447T, Space Acquisitions: DOD Poised to Enhance Space Capabilities, but Persistent Challenges Remain in Developing Space Systems
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Testimony:
Before the Subcommittee on Strategic Forces, Committee on Armed
Services, U.S. Senate:
United States Government Accountability Office:
GAO:
For Release on Delivery:
Expected at 2:30 p.m. EST:
Wednesday, March 10, 2010:
Space Acquisitions:
DOD Poised to Enhance Space Capabilities, but Persistent Challenges
Remain in Developing Space Systems:
Statement of Cristina T. Chaplain, Director:
Acquisition and Sourcing Management:
GAO-10-447T:
GAO Highlights:
Highlights of GAO-10-447T, a testimony before the Subcommittee on
Strategic Forces, Committee on Armed Services, U.S. Senate.
Why GAO Did This Study:
The majority of large-scale acquisition programs in the Department of
Defense‘s (DOD) space portfolio have experienced problems during the
past two decades that have driven up costs by billions of dollars,
stretched schedules by years, and increased technical risks. To
address the cost increases, DOD altered its acquisitions by reducing
the number of satellites it intended to buy, reducing the capabilities
of the satellites, or terminating major space systems acquisitions.
Moreover, along with the cost increases, many space acquisitions are
experiencing significant schedule delays”as much as 8 years”resulting
in potential capability gaps in areas such as missile warning,
military communications, and weather monitoring. This testimony
focuses on:
* the status of space acquisitions,
* causal factors of acquisition problems, and,
* efforts underway to improve acquisitions.
In preparing this testimony, GAO relied on its body of work, including
GAO reports on best practices, assessments of individual space
programs, common problems affecting space system acquisitions, and the
DOD‘s acquisition policies. We have made numerous recommendations to
the DOD in the past on matters relating to overall best practices as
well as on individual space program acquisitions. DOD often concurred
with our findings and recommendations and has efforts underway to
adopt best practices.
What GAO Found:
A long-standing problem in DOD space acquisitions is that program and
unit costs tend to go up significantly from initial cost estimates,
while in some cases, the capability that was to be produced declines.
This problem persists. However, DOD has made progress on several of
its high-risk space programs and is expecting to launch new
generations of satellites across various missions over the next 12
months that should significantly advance some capabilities,
particularly protected communications and space surveillance. While
DOD is having success in readying some satellites for launch, other
space acquisition programs currently in development face challenges
that could further increase costs and delay targeted delivery dates.
Another risk facing DOD space programs over the next few years is the
potential for launch delays because of changes being made in the
launch sector and an increase in the demand for certain DOD launch
vehicles.
Our past work has identified a number of causes for the cost growth
and related problems, but several consistently stand out. First, on a
broad scale, DOD starts more weapon programs than it can afford,
creating a competition for funding that encourages low cost
estimating, optimistic scheduling, overpromising, suppressing bad
news, and, for space programs, forsaking the opportunity to identify
and assess potentially more executable alternatives. Second, DOD has
tended to start its space programs too early, that is, before it has
the assurance that the capabilities it is pursuing can be achieved
within available resources and time constraints. This tendency is
caused largely by the funding process, since acquisition programs
attract more dollars than efforts concentrating solely on proving
technologies. Third, programs have historically attempted to satisfy
all requirements in a single step, regardless of the design challenge
or the maturity of the technologies necessary to achieve the full
capability.
DOD has been working to ensure that its space programs are more
executable and produce a better return on investment. Some actions DOD
and others have adopted or are pursuing include: the Acquisition
Improvement Plan, which lists five initiatives for improving how the
Air Force obtains new capabilities; changes in cost estimating that
are in line with earlier GAO recommendations; and the Weapon Systems
Acquisition Reform Act, which was signed into law in May 2009.
However, there are still significant changes to processes, policies,
and support needed to ensure reforms can take hold. Recent studies and
reviews that have examined national security space have all found that
diffuse leadership has a direct impact on the space acquisition
process, primarily because it makes it difficult to hold any one
person or organization accountable, and there is no single authority
to resolve conflicts among the many organizations involved in space
programs. Moreover, DOD continues to face gaps in critical technical
and program expertise for space. Until both issues are resolved,
commitment to reforms may not be sustainable.
View [hyperlink, http://www.gao.gov/products/GAO-10-447T] or key
components. For more information, contact Cristina Chaplain at (202)
512-4841 or chaplainc@gao.gov.
[End of section]
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss the Department of Defense's
(DOD) space acquisitions. Each year, DOD spends billions of dollars to
acquire space-based capabilities to support current military and other
government operations, as well as to enable DOD to transform the way
it collects and disseminates information. Despite the significant
investment in space, the majority of large-scale acquisition programs
in DOD's space portfolio have experienced problems during the past two
decades that have driven up costs by hundreds of millions and even
billions of dollars and stretched schedules by years and increased
technical risks. To address the cost increases, DOD altered its
acquisitions by reducing the number of satellites it intended to buy,
reducing the capabilities of the satellites, or terminating major
space systems acquisitions. Moreover, along with the cost increases,
many space acquisitions have experienced significant schedule delays--
of as much as 8 years--resulting in potential capability gaps in areas
such as missile warning, military communications, and weather
monitoring. These problems persist.
My testimony today will focus on: (1) the status of space
acquisitions, (2) the efforts DOD is taking to address causes of
problems and increase credibility and success in its space systems
acquisitions, and (3) what remains to be done. Notably, DOD has taken
the important step of acknowledging the acquisition problems of the
past and is taking action to address them, including better management
of the acquisition process and oversight of its contractors. Moreover,
several high-risk space programs have finally resolved technical and
other obstacles and are close to begin delivering capability. However,
other space acquisition programs continue to face challenges in
meeting their cost and schedule targets and aligning the delivery of
space assets with the ground and user systems needed to support and
take advantage of new capability. Additionally, it may take years for
acquisition improvements to take root and produce benefits that will
enable DOD to realize a better return on its investment in space.
Lastly, DOD still needs to decide how to best organize, lead, and
support space activities. If it does not do so, its commitment to
reforms may not be sustainable.
Space Acquisition Challenges Persist:
A long-standing problem in DOD space acquisitions is that program and
unit costs tend to go up significantly from initial cost estimates,
while in some cases, the capability that was to be produced goes down.
Figures 1 and 2 reflect differences in total program and unit costs
for satellites from the time the programs officially began to their
most recent cost estimates. As figure 1 shows, in several cases, DOD
has had to cut back on quantity and capability in the face of
escalating costs. For example, two satellites and four instruments
were deleted from the National Polar-orbiting Operational
Environmental Satellite System (NPOESS) and four sensors are expected
to have fewer capabilities. This will reduce some planned capabilities
for NPOESS as well as planned coverage. The figures below reflect the
total program costs developed in fiscal year 2009. (Last year, we also
compared original cost estimates to current cost estimates for the
broader portfolio of major space acquisitions for fiscal years 2008
through 2013. However, we were unable to perform this analysis this
year because, for most of its major weapon system programs, DOD in
fiscal year 2009 did not issue complete Selected Acquisition Reports,
which contain updated yearly program funding estimates needed to
conduct the analysis.)
Figure 1: Differences in Total Program Costs from Program Start and
Most Recent Estimates (Fiscal Year 2009):
[Refer to PDF for image: vertical bar graph]
Fiscal year 2010 dollars (in millions):
Program and start date: SBIRS, 1996;
Initial Estimate: $4,471.1;
Most Recent Estimate: $13,638.4 (One less satellite and deferred
requirements).
Program and start date: GPS II, 2000;
Initial Estimate: $6,064.1;
Most Recent Estimate: $7,282.1.
Program and start date: WGS, 2000;
Initial Estimate: $1,163.27;
Most Recent Estimate: $2,272.4 (Two additional satellites).
Program and start date: AEHF, 2001;
Initial Estimate: $6,214.5;
Most Recent Estimate: $10,406.8 (One less satellite).
Program and start date: NPOESS, 2002;
Initial Estimate: $6,519.1;
Most Recent Estimate: $13,161.5 (Fewer key sensors and two fewer
satellites).
Program and start date: MUOS, 2004;
Initial Estimate: $6,556.2;
Most Recent Estimate: $6,366.6.
Program and start date: GPS IIIA, 2008;
Initial Estimate: $3,844.6;
Most Recent Estimate: $3,680.9.
Source: GAO analysis of DOD data.
Legend:
SBIRS = Space Based Infrared System;
GPS = Global Positioning System;
WGS = Wideband Global SATCOM;
AEHF = Advanced Extremely High Frequency;
NPOESS = National Polar-orbiting Operational Environmental Satellite
System;
MUOS = Mobile User Objective System.
[End of figure]
Figure 2: Differences in Unit Costs from Program Start to Most Recent
Estimates (Fiscal Year 2009):
[Refer to PDF for image: vertical bar graph]
Fiscal year 2010 dollars (in millions):
Program and start date: SBIRS, 1996;
Initial Estimate: $894.2;
Most Recent Estimate: $3,409.6.
Program and start date: GPS II, 2000;
Initial Estimate: $183.8;
Most Recent Estimate: $220.7.
Program and start date: WGS, 2000;
Initial Estimate: $387.8;
Most Recent Estimate: $454.5.
Program and start date: AEHF, 2001;
Initial Estimate: $1,242.9;
Most Recent Estimate: $2,601.7.
Program and start date: NPOESS, 2002;
Initial Estimate: $1,086.5;
Most Recent Estimate: $3,290.4.
Program and start date: MUOS, 2004;
Initial Estimate: $1,092.7;
Most Recent Estimate: $1,061.1.
Program and start date: GPS IIIA, 2008;
Initial Estimate: $480.6;
Most Recent Estimate: $460.1.
Source: GAO analysis of DOD data.
Legend:
SBIRS = Space Based Infrared System;
GPS = Global Positioning System;
WGS = Wideband Global SATCOM;
AEHF = Advanced Extremely High Frequency;
NPOESS = National Polar-orbiting Operational Environmental Satellite
System;
MUOS = Mobile User Objective System.
[End of figure]
Several space acquisition programs are years behind schedule. Figure 3
highlights the additional estimated months needed for programs to
deliver initial operational capabilities (IOC). These additional
months represent time not anticipated at the programs' start dates.
Generally, the further schedules slip, the more DOD is at risk of not
sustaining current capabilities. For example, according to Air Force
officials, they have requested information from the space community on
how best to address a potential gap in missile warning capabilities.
Figure 3: Differences in Total Number of Months to IOC from Program
Start and Most Recent Estimates:
[Refer to PDF for image: vertical bar graph]
Program and start date: SBIRS, 1996;
Initial Estimate: 86 months;
Most Recent Estimate: System IOC no longer defined, but program is
roughly 8 years behind its original delivery of the first satellite.
Program and start date: GPS II, 2000;
Not applicable because of the program not estimating an IOC date, but
program is about 3.5 years behind its original schedule for launch of
the first Block IIF satellite.
Program and start date: WGS, 2000;
Initial Estimate: 49;
Most Recent Estimate: 98.
Program and start date: AEHF, 2001;
Initial Estimate: 82;
Most Recent Estimate: 141.
Program and start date: NPOESS, 2002;
Initial Estimate: 107;
Most Recent Estimate: 128.
Program and start date: MUOS, 2004;
Initial Estimate: 66;
Most Recent Estimate: 87.
Program and start date: GPS IIIA, 2008;
Not applicable because the program did not estimate an IOC date.
Source: GAO analysis of DOD data.
Legend:
SBIRS = Space Based Infrared System;
GPS = Global Positioning System;
WGS = Wideband Global SATCOM;
AEHF = Advanced Extremely High Frequency;
NPOESS = National Polar-orbiting Operational Environmental Satellite
System;
MUOS = Mobile User Objective System.
[End of figure]
Some Acquisition Programs Have Overcome Problems and Have Satellites
Ready for Launch:
DOD has made progress on several of its high-risk space programs and
is expecting significant advances in capability as a result. In 2009,
DOD launched the third Wideband Global SATCOM (WGS) satellite,
broadening communications capability available to warfighters--and a
fourth WGS satellite is slated for launch in 2011. DOD also launched
two Global Positioning System (GPS) IIR-M satellites, although one has
still not been declared operational because of radio signal
transmission problems. Lastly, DOD supported the launch of a pair of
Space Tracking and Surveillance System satellites, designed to test
the tracking of ballistic missiles in support of missile defense early
missile warning missions--these suffered many delays as well. The
Evolved Expendable Launch Vehicle (EELV) program had its 31st
consecutive successful operational launch last week.
Moreover, though it has had long-standing difficulties on nearly every
space acquisition program, DOD now finds itself in a position to
possibly launch the first new satellite from four different major
space acquisition programs over the next 12 months that are expected
to significantly contribute to missions and capabilities. These
include the Global Positioning System (GPS) IIF satellites, the
Advanced Extremely High Frequency (AEHF) communications satellites,
and the Space Based Space Surveillance (SBSS) satellite--all of which
struggled for years with cost and schedule growth, technical or design
problems, as well as oversight and management weaknesses. Table 1
further describes the status of these efforts.
Table 1: Systems Nearing Launch That Have Overcome Technical and Other
Problems:
GPS IIF:
The first GPS IIF satellite is expected to launch in mid-2010 and will
upgrade timing and navigation accuracy, and add a new signal for
civilian use. The satellite has been delayed over 3 years from its
original launch date to May 2010--representing a further 6 month slip
since we reported last year. Also, the cost of the GPS IIF program is
now expected to be about $1.7 billion--almost $1 billion over the
original cost estimate of $729 million. (This approximately 133
percent cost increase is not apparent in figures 1 and 2 because the
GPS II modernization program includes the development and procurement
of 33 satellites, only 12 of which are IIF satellites.) According to
the GPS Wing, the remaining technical issues with the first IIF
satellite were resolved and will not affect the scheduled launch date--
the last technical issue was a desire to provide additional fault
protection and this is being addressed with enhanced ground operations
procedures. Additionally, the GPS Wing stated that the ground control
software needed to support the first IIF launch has been thoroughly
tested and in place since early this month.
AEHF:
AEHF, which appears to have overcome its technical problems that
delayed the first satellite's launch and increased program cost, is
expected to launch in September 2010, and is expected to deliver 10
times the communications bandwidth that is available today for secure
and protected communications. The launch of the first satellite has
slipped almost 6 years. DOD intends to buy three more satellites,
bringing the total to six (two of these additional satellites are not
reflected in figures 1 and 2). The program has decided that the design
specifications for the first three satellites will remain unchanged
for satellites four through six, which will thus be clones except for
the replacement of obsolete parts. The program office estimates that
the fourth AEHF satellite will cost significantly more than the third
satellite because some components that are no longer manufactured will
have to be replaced and production will have to be restarted after a 4-
year gap. Because of these delays, IOC has slipped about 5 years--from
2008 to 2013. The AEHF program office estimates the cost of the fifth
and sixth satellites to be about $1.6 billion and $1.7 billion (then-
years dollars), with estimated launch dates in 2018 and 2020,
respectively.
SBSS:
The first SBSS Block 10 satellite is expected to launch in 2010 and is
expected to provide greatly improved space situational awareness to
help better understand location and mission capabilities of all
satellites and other objects in space. The launch is expected to be
about 3 years later than originally planned--in part because of launch
vehicle issues unrelated to the satellite. Program officials and the
SBSS contractors are studying the feasibility of launching the SBSS
satellite on a Delta II rocket. The program was restructured in 2006
after an independent review found that the requirements were
overstated and its cost and schedule targets could not be met.
Source: GAO analysis of DOD data and previous GAO reports.
[End of table]
One program that appears to be overcoming remaining technical
problems, but for which we are still uncertain whether it can meet its
current launch date, is the Space Based Infrared System (SBIRS)
satellite program. The first of four geosynchronous earth-orbiting
(GEO) satellites (two sensors have already been launched on a highly
elliptical orbit) is expected to launch in December 2010 and is
expected to continue the missile warning mission with sensors that are
more capable than the satellites currently on orbit. Total cost for
the SBIRS program is currently estimated at over $13.6 billion for
four GEO satellites (and two sensors that have already been delivered
and are operational), representing an increase of about $9.2 billion
over the program's original cost, which included five GEO satellites.
The most recent program estimate developed in 2008 set December 2009
as the launch goal for the first GEO satellite, but program officials
indicate that the first GEO launch will be delayed at least another
year, bringing the total delay to approximately 8 years. The reasons
for the delay include poor government oversight of the contractor,
technical complexities, and rework. The program continues to struggle
with flight software development, and during testing last year,
officials discovered hardware defects on the first GEO satellite,
though the program reports that they have been resolved. The launches
of subsequent GEO satellites have also slipped as a result of flight
software design issues. Program officials indicate that they again
intend to re-baseline the program to more realistic cost and schedule
estimates by mid-to late-2010. Because of the problems on SBIRS, DOD
began a follow-on system effort, now known as Third Generation
Infrared Surveillance (3GIRS), to run in parallel with the SBIRS
program. For fiscal year 2011, DOD plans to cancel the 3GIRS effort,
but also plans to provide funds under the SBIRS program for one of the
3GIRS infrared demonstrations nearing completion.
Other Programs Still Susceptible to Cost and Schedule Overruns:
While DOD is having success in readying some satellites for launch,
other space acquisition programs face challenges that could further
increase cost and delay targeted delivery dates. The programs that may
be susceptible to cost and schedule challenges include NPOESS, Mobile
User Objective System (MUOS), and GPS IIIA. Delays in both the NPOESS
and MUOS programs have resulted in critical potential capability gaps
for military and other government users. The GPS IIIA program was
planned with an eye toward avoiding problems that plagued the GPS IIF
program, but the schedule leaves little room for potential problems
and there is a risk that the ground system needed to operate the
satellites will not be ready when the first satellite is launched.
Table 2 describes the status of these efforts in more detail.
Table 2: Programs Still Susceptible to Cost and Schedule Overruns:
NPOESS:
The NPOESS program has continued to experience technical problems
resulting in further cost and schedule increases. The program was
restructured in 2007, which led to a reduction in the number of
satellites from six to four and deletions or replacements of satellite
sensors. NPOESS was originally estimated to cost $6.5 billion but the
latest estimate is about $13.2 billion--representing more than a 100-
percent cost increase. Furthermore, the launch of the first satellite
has slipped about 5 years--from April 2009 to March 2014. While the
goal of the restructure was to lower future cost and schedule risks,
it increased the risk of a satellite coverage gap and significantly
reduced data collection capabilities. DOD programmed funds for NPOESS
for fiscal year 2011, but according to the White House's Office of
Science and Technology Policy, the NPOESS program is to be
restructured. This would allow DOD and the Department of Commerce to
embark on separate weather satellite programs to meet their unique
needs. The cost and schedule estimates for the NPOESS program cited
above do not reflect the latest events surrounding the program. At
this juncture, many questions surround DOD's strategy for moving
forward, including the following: (1) How does DOD intend to use the
funding programmed for fiscal year 2011? (2) Is the NPOESS contract to
be terminated, and if so, what are the anticipated termination costs
for work under contract? (3) What aspects of the NPOESS program will
continue to be utilized for future efforts? (4) Will the approach
going forward be more or less costly, and will the delivery of
capability be sooner or later than that of NPOESS? While many of these
details have yet to be worked out, this major redirection so late in
the acquisition process may pose significant risk to the nation's
ability to reconstitute its weather satellites in a timely fashion to
mitigate lapses in data collection capabilities.
MUOS:
The MUOS communications satellite program now estimates a 21-month
delay--from March 2010 to December 2011--in the delivery of on-orbit
capability from the first satellite. This represents an additional 10-
month slip from the slip we reported last year, which was caused by
continuing satellite development challenges. In July 2009, a Navy-
initiated review of the program found that while the technical
challenges the program was experiencing could be solved, the MUOS
budget was inadequate and its schedule was optimistic. Subsequently,
in late 2009 the Navy established new cost and schedule baselines for
the program (we have yet to obtain the new cost baseline, and as such,
figures 1 and 2 do not reflect updated MUOS cost estimates). In
January 2011, communications are predicted to degrade below the
required level of availability and remain so until the first MUOS
satellite is available for operations. The MUOS program office is
addressing the potential capability gap by activating dual digital
receiver unit operations on a legacy satellite, leasing commercial
ultra-high-frequency satellite communications services, and examining
the feasibility of expanded digital receiver unit operations on the
legacy payloads of the MUOS satellites.
GPS IIIA:
While the GPS IIIA program has been structured by the Air Force to
prevent the mistakes made on the IIF program, the Air Force aims to
deliver the GPS IIIA satellites 3 years faster than the IIF
satellites. According to Air Force officials, the IIIA contractor
retained some of its workforce from the IIR-M program and plans to
incorporate a previously developed satellite bus--efforts that reduce
program risk. However, we continue to believe the IIIA schedule is
optimistic given the program's late start, past trends in space
acquisitions, and challenges facing the new contractor.[A] To increase
confidence in the schedule for delivering the ground control system
for IIIA (the next generation operational control segment known as
OCX), the GPS Wing added 16 months of development time to the effort.
This means that OCX is now scheduled to be fielded after the May 2014
launch of the first GPS IIIA satellite. The Wing is currently
assessing alternate approaches for resolving the fielding issue, which
will likely have cost consequences.
Source: GAO analysis of DOD data and previous GAO reports.
[A] GAO, Global Positioning System: Significant Challenges in
Sustaining and Upgrading Widely Used Capabilities, [hyperlink,
http://www.gao.gov/products/GA0-09-325], (Washington, D.C.: April 30,
2009).
[End of table]
Challenges in Aligning Space System Components:
This past year we also assessed the levels at which DOD's satellites,
ground control, and user terminals were synchronized to provide
maximum benefit to the warfighter.[Footnote 1] Most space systems
consist of satellites, ground control systems, and user terminals,
though some space systems only require ground control systems to
provide capability to users. Ground control systems are generally used
to (1) download and process data from satellite sensors and
disseminate this information to warfighters and other users and (2)
maintain the health and status of the satellites, including steering
the satellites and ensuring that they stay in assigned orbits.
User terminals, typically procured by the military services and
managed separately from associated satellites and ground control
systems, can range from equipment hosted on backpacks to terminals
mounted on Humvees, airborne assets, or ships. Terminals can be used
to help the warfighter determine longitude, latitude, and altitude via
GPS satellites, or securely communicate with others via AEHF
satellites. Some user terminals are not solely dedicated to delivering
capability from a specific satellite system. For example, the Joint
Tactical Radio System is the primary user terminal associated with the
MUOS program, but the system is also designed to be the next
generation of tactical radios, allowing extensive ground-to-ground
communication as well.
Overall, we found the alignment of space system components proved to
be challenging to DOD. Specifically, we found that for six of DOD's
eight major space system acquisitions, DOD has not been able to align
delivery of satellites with ground control systems, user terminals, or
both. Of the eight major space system acquisitions, five systems'
ground control system efforts are optimally aligned to deliver
capability with their companion satellites, while three are not. For
the five space systems requiring user terminals, none was aligned. In
some cases, capability gaps of 4 or more years have resulted from
delays in the fielding of ground control systems or user terminals.
When space system acquisitions are not aligned, satellite capability
is available but underutilized, though in some cases, work-around
efforts can help compensate for the loss or delay of capability.
Moreover, when ground systems, user terminals, or both are not aligned
with satellites, there are significant limitations in the extent to
which the system as a whole can be independently tested and verified.
[Footnote 2],[Footnote 3]
Launch Manifest Issues:
Another risk facing DOD space programs for the next few years is the
potential for increased demand for certain launch vehicles. DOD is
positioned to launch a handful of satellites across missions over the
next 2 years that were originally scheduled for launch years ago.
Until recently, DOD had four launch pads on the East Coast from which
to launch military satellites. In 2009, DOD launched the final two GPS
IIR-M satellites using the Delta II launch vehicle, thereby
discontinuing its use of the Delta II line and its associated launch
infrastructure. DOD now plans to launch most of its remaining
satellites using one of DOD's EELV types--Atlas V or Delta IV--from
one of two East Coast launch pads. At the same time, the National
Aeronautics and Space Administration (NASA) plans to use the Delta II
to launch at least three major missions before that launch vehicle is
retired. In addition, NASA is already manifesting other major missions
on the Atlas V. Given the expected increased demand for launches--many
of which are considered high priority--and the tempo of launches DOD
has achieved with EELV, it appears that the launch manifest is
crowded. As a result, if programs still struggling with technical,
design, or production issues miss their launch dates, the consequences
could be significant, as it may take many months to secure new dates.
Some of DOD's satellites are dual integrated, which means they can be
launched on either type of EELV. The Air Force deserves credit for
designing the satellites this way because it offers more flexibility
in terms of launch vehicle usage, but there are also cost and schedule
implications associated with rescheduling from one EELV type to the
other. Moreover, DOD can request its launch provider to speed up the
transition time between launches, although this would also increase
costs. Nevertheless, Air Force officials stated that they were
confident that the higher launch rates could be achieved, especially
if a particular satellite's priority increased. According to Air Force
officials, they have already begun to implement means to address these
issues.
DOD Is Taking Actions to Address Space and Weapon Acquisition Problems:
DOD has been working to ensure that its space programs are more
executable and produce a better return on investment. Many of the
actions it is taking address root causes of problems, though it will
take time to determine whether these actions are successful and they
need to be complemented by decisions on how best to lead, organize,
and support space activities.
Our past work has identified a number of causes behind the cost growth
and related problems, but several consistently stand out. First, on a
broad scale, DOD starts more weapon programs than it can afford,
creating a competition for funding that encourages low cost
estimating, optimistic scheduling, overpromising, suppressing bad
news, and for space programs, forsaking the opportunity to identify
and assess potentially more executable alternatives. Second, DOD has
tended to start its space programs too early, that is, before it has
the assurance that the capabilities it is pursuing can be achieved
within available resources and time constraints. This tendency is
caused largely by the funding process, since acquisition programs
attract more dollars than efforts concentrating solely on proving
technologies. Nevertheless, when DOD chooses to extend technology
invention into acquisition, programs experience technical problems
that require large amounts of time and money to fix. Moreover, there
is no way to accurately estimate how long it would take to design,
develop, and build a satellite system when critical technologies
planned for that system are still in relatively early stages of
discovery and invention. Third, programs have historically attempted
to satisfy all requirements in a single step, regardless of the design
challenge or the maturity of the technologies necessary to achieve the
full capability. DOD has preferred to make fewer but heavier, larger,
and more complex satellites that perform a multitude of missions
rather than larger constellations of smaller, less complex satellites
that gradually increase in sophistication. This has stretched
technology challenges beyond current capabilities in some cases and
vastly increased the complexities related to software. Programs also
seek to maximize capability on individual satellites because it is
expensive to launch.
In addition, problematic implementation of an acquisition strategy in
the 1990s, known as Total System Performance Responsibility, for space
systems resulted in problems on a number of programs because it was
implemented in a manner that enabled requirements creep and poor
contractor performance--the effects of which space programs are still
addressing. We have also reported on shortfalls in resources for
testing new technologies, which coupled with less expertise and fewer
contractors available to lead development efforts, have magnified the
challenge of developing complex and intricate space systems.
Our work--which is largely based on best practices in the commercial
sector--has recommended numerous actions that can be taken to address
the problems we identified. Generally, we have recommended that DOD
separate technology discovery from acquisition, follow an incremental
path toward meeting user needs, match resources and requirements at
program start, and use quantifiable data and demonstrable knowledge to
make decisions to move to next phases. We have also identified
practices related to cost estimating, program manager tenure, quality
assurance, technology transition, and an array of other aspects of
acquisition program management that could benefit space programs.
These practices are detailed in appendix I.
DOD is implementing an array of actions to reform how weapons and
space systems are acquired. For space in particular, DOD is working to
ensure critical technologies are matured before large-scale
acquisition programs begin; requirements are defined early in the
process and are stable throughout; and that system design remains
stable, according to the Director of Space and Intelligence under
DOD's Office of the Secretary of Defense for Acquisition, Technology
and Logistics. DOD also intends to follow incremental or evolutionary
acquisition processes versus pursuing significant leaps in
capabilities involving technology risk. The Director of Space and
Intelligence also told us that DOD is revisiting the use of military
standards in its acquisitions and providing more program and
contractor oversight. The approach described to us by the Director of
Space and Intelligence mirrors best practices identified in our
reports. Moreover, some actions--described in the table below--have
already been taken to ensure acquisitions are more knowledge-based.
Table 3: Actions being Taken to Address Space Acquisition Problems:
Requirements:
The Air Force leadership signed the Acquisition Improvement Plan which
lists five initiatives for improving how the Air Force obtains new
capabilities--one of these initiatives covers requirements generation
and includes the direction for the Air Force to certify the
acquisition community can successfully fulfill required capabilities
in conjunction with the Air Force Requirements for Operational
Capabilities Council. Certification means the required capabilities
can be translated in a clear and unambiguous way for evaluation in a
source selection, are prioritized if appropriate, and organized into
feasible increments of capability.
Program Management:
The Space and Missile Systems Center--the Air Force's primary
organization responsible for acquiring space systems--resurrected a
program management assistance group in 2007 to help mitigate program
management, system integration, and program control deficiencies
within specific ongoing programs. This group assists and supplements
wing commanders and program offices in fixing common problems, raising
core competencies, and providing a consistent culture that sweeps
across programs. According to the GPS Wing Commander, this group was
an integral part of the overall process providing application-oriented
training, templates, analyses, and assessments vital to the GPS IIIA
baseline review.
Workforce:
The Air Force is continuing efforts to bring space operators and space
system acquirers together through the Advanced Space Operations School
and the National Security Space Institute. The Air Force anticipates
that this higher-level education will be integral to preparing space
leaders with the best acquisition know-how.
Cost Estimating:
Both the Air Force and the National Reconnaissance Office (NRO) are
taking actions to strengthen cost-estimating. For example, we
recommended that the Secretary of the Air Force ensure that cost
estimates are updated as major events occur within a program that
could have a material impact on cost, and that the roles and
responsibilities of the various Air Force cost-estimating
organizations be clearly articulated.[A] An Air Force policy directive
now requires that cost estimates for major programs be updated
annually, and lays out roles and responsibilities for Air Force cost-
estimating organizations. Furthermore, in its attempts to make more
accurate cost estimates for commercial-like programs (characterized by
use of fixed-price contracts, less complex satellites, lower costs,
and short development timeframes), the NRO cost analysis improvement
group has developed a cost-estimating methodology that considers
acquisition complexity (such as level of oversight and amount of
program reporting), in addition to program technical complexity, and
stated it is considering applying the methodology to more traditional
satellite acquisition programs.
Acquisition Policy:
DOD recently eliminated the tailored national security space
acquisition policy and moved the acquisition of space systems under
DOD's updated acquisition guidance for defense acquisition programs
(DOD Instruction 5000.02). DOD is currently developing an addendum for
the Instruction that would introduce specific management and oversight
processes for acquiring major space systems.
Alignment of Ground Control Systems; In better aligning space system
components, DOD acknowledged that the integration and consolidation of
satellite ground control systems has many benefits, and established
the Space and Intelligence Office to more effectively conduct
oversight of the space and intelligence enterprise. DOD further
disestablished two oversight boards that were deemed less effective in
providing oversight.
Source: GAO analysis of DOD data and previous GAO reports.
[A] GAO, Space Acquisitions: DOD Needs to Take More Action to Address
Unrealistic Initial Cost Estimates of Space Systems, [hyperlink,
http://www.gao.gov/products/GAO-07-96], (Washington, D.C.: November
17, 2006).
[End of table]
Congress has also acted on a broader scale through the Weapon Systems
Acquisition Reform Act, which was signed into law on May 22, 2009.
[Footnote 4] The goal of this new statute is to improve acquisition
outcomes in DOD, with specific emphasis on major defense acquisition
programs (MDAP) and major automated information systems. According to
the President of the United States this legislation is designed to
limit cost overruns before they spiral out of control and will
strengthen oversight and accountability by appointing officials who
will be charged with closely monitoring the weapons systems being
purchased to ensure that costs are controlled. DOD states in its 2010
Quadrennial Defense Review[Footnote 5] that the law also will
substantially improve the oversight of major weapons acquisition
programs, while helping to put MDAPs on a sound footing from the
outset by addressing program shortcomings in the early phases of the
acquisition process. DOD also states that it is undertaking a far-
reaching set of reforms to achieve these goals and to improve how DOD
acquires and fields critical capabilities for current and future wars
and conflicts.
Additional Decisions on Leadership, Organization, and Support Are
Still Needed:
The actions that the Air Force and Office of the Secretary of Defense
have been taking to address acquisition problems are good steps.
However, there are still more significant changes to processes,
policies, and support needed to ensure that reforms can take hold.
Recent studies and reviews examining the leadership, organization, and
management of national security space have all found that there is no
single authority responsible below the President and that authorities
and responsibilities are spread across the department. In fact, the
national security space enterprise comprises a wide range of
government and nongovernment organizations responsible for providing
and operating space-based capabilities serving both military and
intelligence needs.
In 2008, for example, a congressionally chartered commission (known as
the Allard Commission)[Footnote 6] reported that responsibilities for
military space and intelligence programs were scattered across the
staffs of DOD organizations and the intelligence community and that it
appeared that "no one is in charge" of national security space. The
same year, the House Permanent Select Committee on Intelligence
reported similar concerns, focusing specifically on difficulties in
bringing together decisions that would involve both the Director of
National Intelligence and the Secretary of Defense.[Footnote 7] Prior
studies, including those conducted by the Defense Science Board and
the Commission to Assess United States National Security Space
Management and Organization (Space Commission),[Footnote 8] have
identified similar problems, both for space as a whole and for
specific programs. While these studies have made recommendations for
strengthening leadership for space acquisitions, no major changes to
the leadership structure have been made in recent years. In fact, an
executive agent position within the Air Force that was designated in
2001 in response to a Space Commission recommendation to provide
leadership has not been filled since the last executive resigned in
2007.
Diffuse leadership has a direct impact on the space acquisition
process, primarily because it makes it difficult to hold any one
person or organization accountable for balancing needs against wants,
for resolving conflicts among the many organizations involved with
space, and for ensuring that resources are dedicated where they need
to be dedicated. Many of the cost and schedule problems we identified
for the GPS IIF program, for instance, were tied in part to diffuse
leadership and organizational stovepipes, particularly with respect to
DOD's ability to coordinate delivery of space, ground, and user
assets. In fact, DOD is now facing a situation where satellites with
advances in capability will be residing for years in space without
users being able to take full advantage of them because investments
and planning for ground, user, and space components were not well-
coordinated.
Congressional and DOD studies have also called for changes in the
national security space organizational structure to remove cultural
barriers to coordinating development efforts and to better incorporate
analytical and technical support from an organization that is
augmented with military and intelligence community expertise.
Finally, studies have identified insufficient numbers of experienced
space acquisition personnel and inadequate continuity of personnel in
project management positions as problems needing to be addressed in
the space community. Our own studies have identified gaps in key
technical positions, which we believed increased acquisition risks.
For instance, in a 2008 review of the EELV program, we found that
personnel shortages at the EELV program office occurred particularly
in highly specialized areas, such as avionics and launch vehicle
groups.[Footnote 9] These engineers work on issues such as reviewing
components responsible for navigation and control of the rocket.
Moreover, only half the government jobs in some key areas were
projected to be filled. These and other shortages in the EELV program
office heightened concerns about DOD's ability to effectively manage
the program using a contracting strategy for EELV that required
greater government attention to the contractor's technical, cost, and
schedule performance information. In a recent discussion with GAO, the
Director of Space and Intelligence under DOD's Office of the Secretary
of Defense for Acquisition, Technology and Logistics stated that the
primary obstacle to implementing reforms in space is the lack of
"bench strength," primarily technical and systems engineering
expertise.
Concluding Remarks:
In conclusion, DOD space is at a critical juncture. After more than a
decade of acquisition difficulties, which have created potential gaps
in capability, diminished DOD's ability to invest in new space
systems, and lessened DOD's credibility to deliver high-performing
systems within budget and on time, DOD is finally positioned to launch
new generations of satellites that promise vast enhancements in
capability. Moreover, recent program cancellations have alleviated
competition for funding and may have allowed DOD to focus on fixing
problems and implementing reforms rather than taking on new, complex,
and potentially higher-risk efforts. But these changes raise new
questions. Specifically, when can investments in new programs be made?
How can reforms really take hold when leadership is diffuse? How can
reforms take hold when there are still organizational barriers that
prevent effective coordination? And lastly, how can acquisitions be
successful if the right technical and programmatic expertise is not in
place? Clearly, there are many challenges ahead for space. We look
forward to working with the DOD to help ensure that these and other
questions are addressed.
Mr. Chairman, this concludes my prepared statement. I would be happy
to answer any questions you or members of the subcommittee may have at
this time.
Contacts and Acknowledgments:
For further information about this statement, please contact Cristina
Chaplain at (202) 512-4841 or chaplainc@gao.gov. Contact points for
our Offices of Congressional Relations and Pubic Affairs may be found
on the last page of this statement. Individuals who made key
contributions to this statement include Art Gallegos, Assistant
Director; Greg Campbell; Rich Horiuchi; Alyssa Weir; and Peter Zwanzig.
[End of section]
Appendix I: Actions Needed to Address Space and Weapon Acquisition
Problems:
Before undertaking new programs:
* Prioritize investments so that projects can be fully funded and it
is clear where projects stand in relation to the overall portfolio.
* Follow an evolutionary path toward meeting mission needs rather than
attempting to satisfy all needs in a single step.
* Match requirements to resources--that is, time, money, technology,
and people--before undertaking a new development effort.
* Research and define requirements before programs are started and
limit changes after they are started.
* Ensure that cost estimates are complete, accurate, and updated
regularly.
* Commit to fully fund projects before they begin.
* Ensure that critical technologies are proven to work as intended
before programs are started.
* Assign more ambitious technology development efforts to research
departments until they are ready to be added to future generations
(increments) of a product.
* Use systems engineering to close gaps between resources and
requirements before launching the development process.
During program development:
* Use quantifiable data and demonstrable knowledge to make go/no-go
decisions, covering critical facets of the program such as cost,
schedule, technology readiness, design readiness, production
readiness, and relationships with suppliers.
* Do not allow development to proceed until certain thresholds are
met--for example, a high proportion of engineering drawings completed
or production processes under statistical control.
* Empower program managers to make decisions on the direction of the
program and to resolve problems and implement solutions.
* Hold program managers accountable for their choices.
* Require program managers to stay with a project to its end.
* Hold suppliers accountable to deliver high-quality parts for their
products through such activities as regular supplier audits and
performance evaluations of quality and delivery, among other things.
* Encourage program managers to share bad news, and encourage
collaboration and communication.
Source: GAO.
[End of section]
Appendix II: Scope and Methodology:
In preparing this testimony, we relied on our body of work in space
programs, including previously issued GAO reports on assessments of
individual space programs, common problems affecting space system
acquisitions, and the Department of Defense's (DOD) acquisition
policies. We relied on our best practices studies, which comment on
the persistent problems affecting space acquisitions, the actions DOD
has been taking to address these problems, and what remains to be
done, as well as Air Force documents addressing these problems and
actions. We also relied on work performed in support of our annual
weapons system assessments, and analyzed DOD funding estimates to
assess cost increases and investment trends for selected major space
acquisition programs. The GAO work used in preparing this statement
was conducted in accordance with generally accepted government
auditing standards. Those standards require that we plan and perform
the audit to obtain sufficient, appropriate evidence to provide a
reasonable basis for our findings and conclusions based on our audit
objectives. We believe that the evidence obtained provides a
reasonable basis for our findings and conclusions based on our audit
objectives.
[End of section]
Footnotes:
[1] GAO, Defense Acquisitions: Challenges in Aligning Space System
Components, [hyperlink, http://www.gao.gov/products/GAO-10-55]
(Washington, D.C.: Oct. 29, 2009).
[2] In making determinations about whether space system acquisitions
were aligned, we examined whether there were gaps between fielding
dates of satellite capabilities compared to ground system capabilities
and whether lower percentages of user terminal types were planned to
be fielded by the space system acquisitions' planned initial
capability. Generally we considered aspects of a space acquisition
unaligned if there was a gap of years, rather than months, between the
fielding dates of significant capabilities. Regarding user terminals,
we only considered these unaligned compared to satellite capabilities
when user terminals did not meet DOD's measure of synchronization for
military satellite communications space acquisitions. This measure,
established by the U.S. Strategic Command, a primary user of DOD space
systems, asserts that 20 percent of any type of user terminal should
be fielded by a space system acquisition's initial capability date and
85 percent should be fielded by its full capability date.
[3] It should be noted that while there are criteria for
communications satellites, there are no criteria available in DOD that
determine the optimum alignment or synchronization for the broader
portfolio of satellite programs. This is principally because of
inherent differences in satellite missions and their associated ground
and user assets, according to officials involved in space system
development as well as acquisition oversight.
[4] Pub. L. No. 111-23, 123 Stat. 1704 (2009).
[5] Department of Defense, Quadrennial Defense Review Report
(Washington, D.C., Feb. 1, 2010).
[6] Institute for Defense Analyses, Leadership, Management, and
Organization for National Security Space: Report to Congress of the
Independent Assessment Panel on the Organization and Management of
National Security Space (Alexandria, VA., July 2008).
[7] House Permanent Select Committee on Intelligence, Report on
Challenges and Recommendations for United States Overhead Architecture
(Washington, D.C., October 2008).
[8] Department of Defense, Report of the Commission to Assess United
States National Security Space Management and Organization
(Washington, D.C., Jan. 11, 2001).
[9] GAO, Space Acquisitions: Uncertainties in the Evolved Expendable
Launch Vehicle Program Pose Management and Oversight Challenges,
[hyperlink, http://www.gao.gov/products/GAO-08-1039] (Washington,
D.C.: Sept. 26, 2008).
[End of section]
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