Spacelift Washington: Goodbye Summer Hello … Change

(WASHINGTON) – Where did summer go? It fled almost as quickly as Lance Bass’s eticket to the Soyuz. Congress has returned, once again there is war talk-this time on a new, Iraqi front. And once again the federal budget bills are languishing in the committees still awaiting action by lawmakers.

The one positive event this summer for the space industry – the successful maiden launch of the Atlas V Evolved Expendable Launch Vehicle (EELV) – has in some way been overshadowed by less obvious activities within the nation’s civil space program.

While the EELV era’s success is nothing less than critical to the survival of the U.S. launch services industry, a reading of the tea leaves suggests that the tidal wave of changes under the NASA leadership of Sean O’Keefe is starting to build momentum-albeit quietly and no less critical to industry’s fortunes. And the water that this wave contains is of a whole new flavor not seen in many a year: nothing less than a new way of doing business at NASA headquarters.

Those who prefer to ignore these signs will be left adrift in this raging sea. So rather than engage in denial about this, or to “rage, rage against the dying of the light”, perhaps understanding where O’Keefe is coming from, and ultimately coming to terms with this new direction, might be more instructive and helpful to those who will, in one way or another, manage this process from the aerospace community side of things.

From both the NASA side and the industry side, a new dialog is needed, especially before the sons and daughters of Americans deploy to Baghdad, thereby effectively wiping space matters off the priority list of many of us – again.

The O’Keefe Agenda

So what’s going on, and where do we find indicators of what is to come from Sean O’Keefe? In this we have a recent contract action, a rumored second decision, and the prospects of a third action coming in 2 years.

O’Keefe moved in the past weeks to terminate the Consolidated Space Operations Contract (CSOC) set in place by the Goldin administration; some sources suggest that the CLCS contract at the Kennedy Space Center may be ended; and the highly successful Space Flight Operations Contract (SFOC), whose primary term ended this year, has received only a 2-year extension. So what are we to make of all of this?

Clearly, it would appear that the intent of the O’Keefe administration is to move the space agency away from large scale single contractor operations contracts and supplant them/replace them with smaller management structures. The motive for breaking up these large programs would appear to be not to achieve additional cost savings, although such would obviously not be frowned upon.

But rather it would appear to be a matter of O’Keefe philosophy. Rightly or wrongly, it seems O’Keefe’s motive is to attempt to induce greater competition into the agency’s management agenda. By breaking up the larger management operations contracts O’Keefe’s message is clear- in this series, smaller is better.

There is at least one problem with such an approach: today’s existing aerospace industry is finite.

That is, there are just so many companies in this business still standing after the wave of consolidations that dominated the 1990s. And while it might be a nice idea to find new competitors who have the in-house strength to accomplish this, the simple truth is that they are just a handful left.

Boeing and Lockheed Martin are the primary places where Space Shuttle history remains, for example. These companies and their “legacy” divisions designed, built, and by extraction, operate these machines. And in their place, there are but a few – Northrop Grumman, Orbital Sciences to name just two – that might be able to master spaceflight operations or human spaceflight management.

If this were the 1980s there would be a dozen or more. Today there are just a handful. Thus inducing competition may prove more difficult today than ever before, given the shape of the industry that has survived.

Note that I am not saying this idea of O’Keefe’s is good or bad. Just that it appears to be a clear new reality that we all need to understand. Talk about. Prepare for. Be a part of.
If not for money but for philosophy, O’Keefe will need to have a dialog with all of these firms, so that they better understand what is underway- and what is to come.

This seismic shift in operational philosophy is the first such change in more than a decade. Many of today’s managers have never known anything other than the “Goldin” way. The learning curve that O’Keefe is on as a newly-minted Administrator may well be matched by a cadre of industry leaders whose firms evolved to suit the previous ways of doing business, because that was what the NASA leadership wanted.

Much like turning a battleship onto a new course, it will take time, and careful action, as well as dialog to mark this new transitional path.

O’Keefe has thus far shown good instincts and an abundance of caution as he has moved fully into his manager’s chair. To successfully execute the next step will require yet another transition- from top manager to leader.

His agency is ready for that leadership.

With preparation, the industry can be, too.

SPACELIFT WASHINGTON © 2002 by Frank Sietzen, Jr. The opinions expressed in this column are the author’s own, and do not represent the positions of any other person, organization, or group.