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entitled 'Geostationary Operational Environmental Satellites: Steps 
Remain in Incorporating Lessons learned from Other Satellite Programs' 
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Report to the Subcommittee on Environment, Technology, and Standards, 
Committee on Science, House of Representatives: 

United States Government Accountability Office: 

GAO: 

September 2006: 

Geostationary Operational Environmental Satellites: 

Steps Remain in Incorporating Lessons Learned from Other Satellite 
Programs: 

Geostationary Operational Environmental Satellites: 

GAO-06-993: 

GAO Highlights: 

Highlights of GAO-06-993, a report to the Subcommittee on Environment, 
Technology, and Standards, Committee on Science, House of 
Representatives 

Why GAO Did This Study: 

The National Oceanic and Atmospheric Administration (NOAA) plans to 
procure the next generation of geostationary operational environmental 
satellites, called the Geostationary Operational Environmental 
Satellites-R series (GOES-R). This new series is considered critical to 
the United States’ ability to maintain the continuity of data required 
for weather forecasting through the year 2028. GAO was asked to (1) 
determine the status of and plans for the GOES-R series procurement, 
and (2) identify and evaluate the actions that the program management 
team is taking to ensure that past problems experienced in procuring 
other satellite programs are not repeated. 

What GAO Found: 

NOAA is nearing the end of the preliminary design phase of its GOES-R 
system—which was estimated to cost $6.2 billion and scheduled to have 
the first satellite ready for launch in 2012. It expects to award a 
contract in August 2007 to develop this system. However, according to 
program officials, NOAA’s plans for the GOES-R procurement could change 
in the near future. Recent analyses of the GOES-R program cost—which in 
May 2006 the program office estimated could reach $11.4 billion—have 
led the agency to consider reducing the scope of requirements for the 
satellite series. NOAA officials estimated that a decision on the 
future scope and direction of the program could be made by the end of 
September 2006. 

NOAA has taken steps to implement lessons learned from past satellite 
programs, but more remains to be done. Prior satellite 
programs—including a prior GOES series, a polar-orbiting environmental 
satellite series, and various military satellite programs—often 
experienced technical challenges, cost overruns, and schedule delays. 
Key lessons from these programs include the need to (1) establish 
realistic cost and schedule estimates, (2) ensure sufficient technical 
readiness of the system’s components prior to key decisions, (3) 
provide sufficient management at government and contractor levels, and 
(4) perform adequate senior executive oversight to ensure mission 
success. NOAA has established plans to address these lessons by 
conducting independent cost estimates, performing preliminary studies 
of key technologies, placing resident government offices at key 
contractor locations, and establishing a senior executive oversight 
committee. However, many steps remain to fully address these lessons 
(see table). Until it completes these activities, NOAA faces an 
increased risk that the GOES-R program will repeat the increased cost, 
schedule delays, and performance shortfalls that have plagued past 
procurements. 

Table: Key Lessons Learned and the Activities Taken or Remaining to 
Fully Address Them: 

Lessons learned: Establish realistic cost and schedule estimates; 
Actions taken or under way: 
* Obtaining multiple independent cost estimates; 
* Conducting risk analysis of schedule estimates; Actions remaining: 
Ensuring objectivity when reconciling alternative estimates. 

Lessons learned: Ensure sufficient technical readiness of the system’s 
components prior to critical decisions; Actions taken or under way: 
Conducted preliminary studies of key technologies and components; 
Actions remaining: Ensuring sufficient technical maturity before 
proceeding to production. 

Lessons learned: Provide sufficient management of contractors and 
subcontractors; Actions taken or under way: 
* Increased presence at contractor sites; 
* Plan to increase number of system engineers; 
* Plan to hire three specialists in earned value; Actions remaining: 
Assessing the number of earned value specialists needed commensurate 
with increased acquisition activities. 

Lessons learned: Perform effective executive-level oversight; Actions 
taken or under way: NOAA’s program management council meets regularly 
to oversee project; Actions remaining: [Empty]. 

Source: GAO analysis. 

[End of Table] 

What GAO Recommends: 

We are making recommendations to the Secretary of Commerce to direct 
its NOAA Program Management Council to establish a process for 
reconciling the government and independent cost estimates; perform a 
comprehensive review of a key instrument prior to moving it into 
production; and to evaluate the appropriate levels of resources needed 
at the program office to oversee the contractor’s performance in 
meeting cost and schedule targets. In written comments, the Department 
of Commerce agreed with the recommendations and identified plans for 
implementing them. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-993]. 

To view the full product, including the scop and methodology, click on 
the link above. For more information, contact Dave Powner at (202)512-
9286 or pownerd@gao.gov. 

[End of Section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

GOES-R Procurement Activities Are Under Way, but System Requirements 
and Cost Estimates May Change: 

The GOES-R Program Office Has Taken Steps to Address Past Lessons 
Learned, but Significant Actions Remain: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Current Shortfalls in Contractor Performance on Key 
Instrument Development: 

Appendix III: Comments from the Department of Commerce: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Summary of the Procurement History of GOES: 

Table 2: Summary of Key GOES-R System Improvements: 

Table 3: Expected GOES-R Series Instruments, as of June 2006: 

Table 4: Key Problems Experienced on Selected Major Space Systems: 

Table 5: Status of GOES-R Program Contracts, as of June 2006: 

Table 6: GOES-R Program Life Cycle Cost Estimate, as of June 2006: 

Table 7: GOES-R Program Schedule, as of June 2006: 

Figures: 

Figure 1: Approximate GOES Geographic Coverage: 

Figure 2: Generic GOES Data Relay Pattern: 

Figure 3: GOES-R Program Office Structure and Staffing: 

Figure 4: Cumulative Cost Variance of the ABI Instrument Contract over 
an 11-month Period: 

Figure 5: Cumulative Schedule Variance of the ABI Instrument Contract 
over an 11-month Period: 

Abbreviations: 

ABI: Advanced Baseline Imager: 
AEHF: Advanced Extremely High Frequency Satellite System: 
DOD: Department of Defense: 
GOES-R: Geostationary Operational Environmental Satellites-R series: 
NASA: National Aeronautics and Space Administration: 
NESDIS: National Environmental Satellite Data and Information Service: 
NOAA: National Oceanic and Atmospheric Administration: 
NPOESS: National Polar-orbiting Operational Environmental Satellite 
System: 
SBIRS-High: Space Based Infrared System High Program: 

United States Government Accountability Office: 
Washington, DC 20548: 

September 6, 2006: 

The Honorable Vernon J. Ehlers: 
Chairman: 
The Honorable David Wu: 
Ranking Minority Member: 
Subcommittee on Environment, Technology, and Standards: 
Committee on Science: 
House of Representatives: 

Operational geostationary environmental satellites play a critical role 
in our nation's weather forecasting. These satellites--which are 
managed by the National Oceanic and Atmospheric Administration (NOAA)-
-provide critical information on atmospheric, oceanic, climatic, and 
solar conditions that help meteorologists observe and predict global 
and local weather events. They also provide the best means to identify 
severe storm conditions, such as hurricanes and tornadoes, and to track 
the movement and intensity of these storms once they develop. 

NOAA, with the aid of the National Aeronautics and Space Administration 
(NASA), is planning to procure the next generation of geostationary 
satellites, called the Geostationary Operational Environmental 
Satellites-R series (GOES-R). The GOES-R series is to replace the 
current series of satellites which will likely begin to reach the end 
of their useful lives in approximately 2012. This new series is 
expected to mark the first major technological advance in GOES 
instrumentation since 1994. It is also considered critical to the 
United States' ability to maintain the continuity of data required for 
weather forecasting through the year 2028. 

This report responds to your request that we review NOAA's management 
of the GOES-R program. Specifically, we were asked to (1) determine the 
status of and plans for the GOES-R series procurement, and (2) identify 
and evaluate the actions that the program management team is taking to 
ensure that past problems experienced in procuring other satellite 
programs are not repeated. 

To determine GOES-R status and plans, we reviewed program documents on 
the planned acquisition schedules, cost estimates, and system 
requirements, and interviewed program officials. To assess the program 
office's actions to address lessons learned from past satellite 
programs, we analyzed lessons learned from past satellite programs-- 
including a prior GOES satellite series (called GOES I-M), the National 
Polar-orbiting Operational Environmental Satellite System (NPOESS), and 
selected military satellite programs. We analyzed program management 
documents, including data on a critical instrument's development, to 
determine and evaluate plans for addressing past lessons. We also 
interviewed program officials from NOAA and NASA. 

We conducted our work at NOAA and NASA offices in the Washington, D.C., 
metropolitan area between December 2005 and August 2006, in accordance 
with generally accepted government auditing standards. Appendix I 
contains further details on our objectives, scope, and methodology. 

Results in Brief: 

NOAA is nearing the end of the preliminary design phase of its GOES-R 
system, which is officially estimated to cost $6.2 billion and 
scheduled to have the first satellite ready for launch in 2012. To 
date, NOAA has issued contracts for the preliminary design of the 
overall GOES-R system to three vendors and expects to award a contract 
to one of these vendors in August 2007 to develop the satellites. In 
addition, to reduce the risks associated with developing new 
instruments, NOAA has issued contracts for the early development of one 
critical instrument and for the preliminary designs of four other 
instruments. The agency plans to turn these instrument contracts over 
to the vendor that is awarded the contract for the overall GOES-R 
program. However, according to program officials, NOAA's plans for the 
GOES-R procurement could change in the near future. Recent analyses of 
the GOES-R program cost--which in May 2006 the program office estimated 
could reach $11.4 billion--have led the agency to consider reducing the 
scope of requirements for the satellite series. NOAA officials 
estimated that a decision on the future scope and direction of the 
program could be made by the end of September 2006. 

NOAA has taken steps to implement lessons learned from past satellite 
programs, but more remains to be done. Prior satellite programs-- 
including a prior GOES series, a polar-orbiting environmental satellite 
series, and various military satellite programs--often experience 
technical challenges, cost overruns, and schedule delays. Key lessons 
from these programs include the need to (1) establish realistic cost 
and schedule estimates, (2) ensure sufficient technical readiness of 
the system's components prior to key decisions, (3) provide sufficient 
management at government and contractor levels, and (4) perform 
adequate senior executive oversight to ensure mission success. NOAA has 
established plans to address these lessons by conducting independent 
cost estimates, performing preliminary studies of key technologies, 
placing resident government offices at key contractor locations, and 
establishing a senior executive oversight committee. However, many 
steps remain to fully address these lessons. Specifically, NOAA has not 
yet developed a process to evaluate and reconcile the independent and 
government cost estimates. In addition, NOAA has not yet determined how 
it will ensure that a sufficient level of technical maturity will be 
achieved in time for an upcoming decision milestone, nor has it 
determined the appropriate level of resources it needs to adequately 
track and oversee the program using earned value management.[Footnote 
1] Until it completes these activities, NOAA faces an increased risk 
that the GOES-R program will repeat the increased cost, schedule 
delays, and performance shortfalls that have plagued past procurements. 

We are making recommendations to the Secretary of Commerce to direct 
its NOAA Program Management Council to establish a process for 
objectively evaluating and reconciling the government and independent 
life cycle cost estimates once the program requirements are finalized; 
to establish a team of system engineering experts to perform a 
comprehensive review of the Advanced Baseline Imager instrument to 
determine the level of technical maturity achieved on the instrument 
before moving it into production; and to seek assistance in determining 
the appropriate levels of resources needed at the program office to 
adequately track and oversee the contractor's earned value management 
data. 

The Department of Commerce provided written comments on a draft of this 
report in which it agreed with our recommendations and identified 
planned steps for implementing them (see app. III). The department also 
provided technical corrections, which we have incorporated in this 
report as appropriate. 

Background: 

Since the 1960s, geostationary and polar-orbiting environmental 
satellites have been used by the United States to provide 
meteorological data for weather observation, research, and forecasting. 
NOAA's National Environmental Satellite Data and Information Service 
(NESDIS) is responsible for managing the civilian geostationary and 
polar-orbiting satellite systems as two separate programs, called GOES 
and the Polar Operational Environmental Satellites, respectively. 

Unlike polar-orbiting satellites, which constantly circle the earth in 
a relatively low polar orbit, geostationary satellites can maintain a 
constant view of the earth from a high orbit of about 22,300 miles in 
space. NOAA operates GOES as a two-satellite system that is primarily 
focused on the United States (see fig. 1). These satellites are 
uniquely positioned to provide timely environmental data to 
meteorologists and their audiences on the earth's atmosphere, its 
surface, cloud cover, and the space environment. They also observe the 
development of hazardous weather, such as hurricanes and severe 
thunderstorms, and track their movement and intensity to reduce or 
avoid major losses of property and life. Furthermore, the satellites' 
ability to provide broad, continuously updated coverage of atmospheric 
conditions over land and oceans is important to NOAA's weather 
forecasting operations. 

Figure 1: Approximate GOES Geographic Coverage: 

[See PDF for image] 

Source: NOAA (data); MapArt (map). 

[End of figure] 

To provide continuous satellite coverage, NOAA acquires several 
satellites at a time as part of a series and launches new satellites 
every few years. Three satellites--GOES-11, GOES-12, and GOES-13--are 
currently in orbit. Both GOES-11 and GOES-12 are operational 
satellites, while GOES-13 is in an on-orbit storage mode. It is a 
backup for the other two satellites should they experience any 
degradation in service. The others in the series, GOES-O and GOES-P, 
are planned for launch over the next few years.[Footnote 2] NOAA is 
also planning a future generation of satellites, known as the GOES-R 
series, which are planned for launch beginning in 2012. 

Each of the operational geostationary satellites continuously transmits 
raw environmental data to NOAA ground stations. The data are processed 
at these ground stations and transmitted back to the satellite for 
broadcast to primary weather services both in the United States and 
around the world, including the global research community. Raw and 
processed data are also distributed to users via ground stations 
through other communication channels, such as dedicated private 
communication lines and the Internet. Figure 2 depicts a generic data 
relay pattern from the geostationary satellites to the ground stations 
and commercial terminals. 

Figure 2: Generic GOES Data Relay Pattern: 

[See PDF for image] 

Source: GAO analysis of NOAA data. 

[End of figure] 

A Brief History of Prior GOES Series: 

To date, NOAA has procured three series of GOES satellites and is in 
the planning stages to acquire a fourth one (see table 1). 

Table 1: Summary Of The Procurement History Of Goes 

Series name: Original GOES[B]; 
Procurement duration[A]: 1970-1987; 
Satellites: 1, 2, 3, 4, 5, 6, 7. 

Series name: GOES I-M; 
Procurement duration[A]: 1985-2001; 
Satellites: 8, 9, 10, 11, 12. 

Series name: GOES-N; 
Procurement duration[A]: 1998-2011; 
Satellites: 13, O, P, Q[C]. 

Series name: GOES-R; 
Procurement duration[A]: 2007-2020; 
Satellites: R, S, T, U. 

Source: GAO analysis of NOAA data. 

[A] Duration includes time from contract award to final satellite 
launch. 

[B] The procurement of these satellites consisted of four separate 
contracts for (1) two early prototype satellites and GOES-1, (2) GOES- 
2 and -3, (3) GOES-4 through -6, and (4) GOES-G (failed on launch) and 
GOES-7. 

[C] NOAA decided not to exercise the option for this satellite. 

[End of table] 

Original GOES Satellites: 

In 1970, NOAA initiated its original GOES program based on experimental 
geostationary satellites developed by NASA. While these satellites 
operated effectively for many years, they had technical limitations. 
For example, this series of satellites was "spin-stabilized," meaning 
that the satellites slowly spun while in orbit to maintain a stable 
position with respect to the earth. As a result, the satellite viewed 
the earth only about 5 percent of the time and had to collect data very 
slowly, capturing one narrow band of data each time its field-of-view 
swung past the earth. A complete set of sounding data took 2 to 3 hours 
to collect. 

GOES I-M Series: 

In 1985, NOAA and NASA began to procure a new generation of GOES, 
called the GOES I-M series, based on a set of requirements developed by 
NOAA's National Weather Service, NESDIS, and NASA, among others. GOES I-
M consisted of five satellites, GOES-8 through GOES-12, and was a 
significant improvement in technology from the original GOES 
satellites. For example, GOES I-M was "body-stabilized," meaning that 
the satellite held a fixed position in orbit relative to the earth, 
thereby allowing for continuous meteorological observations. Instead of 
maintaining stability by spinning, the satellite would preserve its 
fixed position by continuously making small adjustments in the rotation 
of internal momentum wheels or by firing small thrusters to compensate 
for drift. These and other enhancements meant that the GOES I-M 
satellites would be able to collect significantly better quality data 
more quickly than the older series of satellites. 

GOES-N Series: 

In 1998, NOAA began the procurement of satellites to follow GOES I-M, 
called the GOES-N series. This series used existing technologies for 
the instruments and added system upgrades, including an improved power 
subsystem and enhanced satellite pointing accuracy. Furthermore, the 
GOES-N satellites were designed to operate longer than its 
predecessors. This series originally consisted of four satellites, GOES-
N through GOES-Q. However, the option for the GOES-Q satellite was 
cancelled based on NOAA's assessment that it would not need the final 
satellite to continue weather coverage. In particular, the agency found 
that the GOES satellites already in operation were lasting longer than 
expected and that the first satellite in the next series could be 
available to back up the last of the GOES-N satellites. As noted 
earlier, the first GOES-N series satellite--GOES-13--was launched in 
May 2006. The GOES-O and GOES-P satellites are currently in production 
and are expected to be launched in July 2008 and July 2011, 
respectively. 

Planned GOES-R Series: 

NOAA is currently planning to procure the next series of GOES 
satellites, called the GOES-R series. This series will consist of four 
satellites, GOES-R through GOES-U, and is intended to provide the first 
major technological advance in instrumentation since the first 
satellite of the GOES I-M series was launched in 1994.[Footnote 3] 

GOES-R Program--An Overview: 

NOAA is planning for the GOES-R program to improve on the technology of 
prior GOES series, in terms of both system and instrument improvements. 
The system improvements are expected to fulfill more demanding user 
requirements and to provide more rapid information updates. Table 2 
highlights key system-related improvements GOES-R is expected to make 
to the geostationary satellite program. 

Table 2: Summary Of Key Goes-R System Improvements 

Key feature: Total products; 
GOES-N (current): 41; 
GOES-R: ~152. 

Key feature: Downlink rate of raw data collected by instruments (from 
satellite to ground stations); 
GOES-N (current): 2.6 Mbps; 
GOES-R: 132 Mbps. 

Key feature: Broadcast rate of processed GOES data (from satellite to 
users); 
GOES-N (current): 2.1 Mbps;
GOES-R: 17-24 Mbps. 

Key feature: Raw data storage (the length of time that raw data will be 
stored at ground stations); 
GOES-N (current): 0 days; 
GOES-R: 30 days. 

Source: GAO analysis of NOAA data. 

[End of table] 

The instruments on the GOES-R series are expected to significantly 
increase the clarity and precision of the observed environmental data. 
NOAA plans to acquire five different types of instruments. The program 
office considers two of the instruments--the Advanced Baseline Imager 
and the Hyperspectral Environmental Suite--to be most critical because 
they will provide data for key weather products. Table 3 summarizes the 
planned instruments and their expected capabilities. 

Table 3: Expected Goes-R Series Instruments, As Of June 2006 

Planned instrument: Advanced Baseline Imager; 
Description: Expected to provide variable area imagery and radiometric 
information of the earth's surface, atmosphere, and cloud cover. Key 
features include; 
* monitoring and tracking severe weather,; 
* providing images of clouds to support forecasts, and; 
* providing higher resolution, faster coverage, and broader coverage 
simultaneously. 

Planned instrument: Hyperspectral Environmental Suite; 
Description: Expected to provide information about the earth's surface 
to aid in the prediction of weather and climate monitoring. Key 
features include; 
* providing atmospheric moisture and temperature profiles to support 
forecasts and climate monitoring,; 
* monitoring coastal regions for ecosystem health, water quality, 
coastal erosion, and harmful algal blooms, and; 
* providing higher resolution and faster coverage. 

Planned instrument: Space Environmental In-Situ Suite; 
Description: Expected to provide information on space weather to aid in 
the prediction of particle precipitation, which causes disturbance and 
disruption of radio communications and navigation systems. Key features 
include; 
* measuring magnetic fields and charged particles,; 
* providing improved heavy ion detection, adding low energy electrons 
and protons, and; 
* enabling early warnings for satellite and power grid operation, 
telecom services, astronauts, and airlines. 

Planned instrument: Solar Imaging Suite; 
Description: Expected to provide coverage of the entire dynamic range 
of solar X-ray features, from coronal holes to X-class flares, as well 
as estimate the measure of temperature and emissions. Key features 
include; 
* providing images of the sun and measuring solar output to monitor 
solar storms and; 
* providing improved imager capability. 

Planned instrument: Geostationary Lightning Mapper; 
Description: Expected to continuously monitor lightning activity over 
the United States and provide a more complete dataset than previously 
possible. Key features include; 
* detecting lightning strikes as an indicator of severe storms and; 
* providing a new capability to GOES that only previously existed on 
polar satellites. 

Source: GAO analysis of NOAA data. 

[End of table] 

GOES-R Program Office Structure: 

The program management structure for the GOES-R program differs from 
past GOES programs. Prior to the GOES-R series, NOAA was responsible 
for program funding, procurement of the ground elements, and on-orbit 
operation of the satellites, while NASA was responsible for the 
procurement of the spacecraft, instruments, and launch services. NOAA 
officials stated that this approach limited the agency's insight and 
management involvement in the procurement of major elements of the 
system. 

Alternatively, under the GOES-R management structure, NOAA has 
responsibility for the procurement and operation of the overall system-
-including spacecraft, instruments, and launch services. NASA is 
responsible for the procurement of the individual instruments until 
they are transferred to the overall GOES-R system contractor for 
completion and integration onto the spacecraft. Additionally, to take 
advantage of NASA's acquisition experience and technical expertise, 
NOAA located the GOES-R program office at NASA's Goddard Space Flight 
Center. It also designated key program management positions to be 
filled with NASA personnel (see fig. 3). These positions include the 
deputy system program director role for advanced instrument and 
technology infusion, the project manager for the flight portion of the 
system, and the deputy project manager for the ground and operations 
portion of the system. NOAA officials explained that they changed the 
management structure for the GOES-R program in order to streamline 
oversight and fiduciary responsibilities, but that they still plan to 
rely on NASA's expertise in space system acquisitions. 

Figure 3: GOES-R Program Office Structure and Staffing: 

[See PDF for image] 

Source: NOAA. 

[End of figure] 

Satellite Programs Often Experience Technical Problems, Cost Overruns, 
and Schedule Delays: 

Satellite programs are often technically complex and risky 
undertakings, and as a result, they often experience technical 
problems, cost overruns, and schedule delays. We and others have 
reported on a historical pattern of repeated missteps in the 
procurement of major satellite systems, including the National Polar- 
orbiting Operational Environmental Satellite System (NPOESS), the GOES 
I-M series, the Space Based Infrared System High Program (SBIRS-High), 
and the Advanced Extremely High Frequency Satellite System 
(AEHF).[Footnote 4] Table 4 lists key problems experienced with these 
programs and is followed by a summary of each program. 

Table 4: Key Problems Experienced On Selected Major Space Systems

Problem: Insufficient technical readiness prior to critical decision 
points; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: [Empty]. 

Problem: Inadequate preliminary studies prior to the decision to award 
a development contract; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: [Empty]. 

Problem: Insufficient technical maturity prior to the decision to move 
to production; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: X. 

Problem: Unrealistic cost and schedule estimates; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: [Empty]. 

Problem: Optimistic assumptions including: savings from heritage 
systems; 
NPOESS: X; 
GOES I-M: X; 
SBIRS- High: X; 
AEHF: [Empty]. 

Problem: Optimistic assumptions including: readiness of technology 
maturity; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: X. 

Problem: Optimistic assumptions including: constant and available 
industrial base; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: X; 
AEHF: [Empty]. 

Problem: Optimistic assumptions including: no weight growth; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS-High: X; 
AEHF: X. 

Problem: Optimistic assumptions including: no requirements growth; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: X. 

Problem: Optimistic assumptions including: savings from lot buys versus 
single-unit purchase; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: X; 
AEHF: [Empty]. 

Problem: Optimistic assumptions including: overly aggressive schedule; 
NPOESS: X; 
GOES I-M: X; 
SBIRS- High: X; 
AEHF: X. 

Poor program and contractor management:

Problem: Quality and subcontractor issues; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: X. 

Problem: Inadequate systems engineering capabilities; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: X. 

Problem: Inadequate earned value management capabilities; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS-High: X; 
AEHF: X. 

Problem: Insufficient management reserve; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: X. 

Problem: Ineffective contract award fee structure; 
NPOESS: X; 
GOES I-M: X; 
SBIRS-High: X; 
AEHF: [Empty]. 

Problem: Poor senior executive level oversight: 

Problem: Infrequent meetings; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: [Empty]. 

Problem: Inability to make timely decisions; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: [Empty]. 

Problem: Other; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: [Empty]; 
AEHF: [Empty]. 

Problem: Unstable funding stream; 
NPOESS: X; 
GOES I-M: [Empty]; 
SBIRS- High: X; 
AEHF: X. 

Problem: Unstable requirements; 
NPOESS: [Empty]; 
GOES I-M: [Empty]; 
SBIRS-High: X; 
AEHF: X. 

Source: GAO analysis of NOAA and DOD data. 

[End of table] 

National Polar-orbiting Operational Environmental Satellite System: 

NPOESS is being developed to combine two separate polar-orbiting 
environmental satellite systems currently operated by NOAA and the 
Department of Defense (DOD) into a single state-of-the-art environment 
monitoring system. A tri-agency program office--comprised of officials 
from DOD, NOAA, and NASA--is responsible for managing this program. 
Within the program office, each agency has the lead on certain 
activities. NOAA has overall program management responsibility for the 
converged system and for satellite operations; DOD has the lead on the 
acquisition; and NASA has primary responsibility for facilitating the 
development and incorporation of new technologies into the converged 
system. 

Since its inception, the NPOESS program has encountered cost overruns 
and schedule delays. Specifically, within a year of the contract award, 
the program cost estimate increased by $1.2 billion, from $6.9 billion 
to $8.1 billion, and the expected availability of the first satellite 
was delayed by 20 months. We reported in September 2004 that these cost 
increases and schedule delays were caused, in part, by changes in the 
NPOESS funding stream.[Footnote 5] Subsequently, in November 2005, we 
reported that problems in the development of a critical sensor would 
likely cause program costs to grow by at least another $3 billion and 
the schedule for the first launch would likely be delayed by almost 3 
years.[Footnote 6] The senior executive oversight committee for NPOESS 
was expected to make a decision in December 2005 on the direction of 
the program--which involved increased costs, delayed schedules, and 
reduced functionality. We urged this committee to make a decision 
quickly so that the program could proceed. However, in late November 
2005, the NPOESS program's anticipated cost growth triggered a 
legislative requirement forcing DOD to reassess its options and to 
recertify the program.[Footnote 7] In June 2006, DOD decided to reduce 
the system's capabilities and number of satellites from six to four, 
and announced that the newly-restructured program was estimated to cost 
$11.5 billion and the launch of the first satellite had been delayed by 
at least 4 years from the time the contract was awarded. 

NPOESS' problems involved a number of factors, including unrealistic 
cost and schedule estimates, insufficient technical maturity of 
critical sensors at a key development milestone, poor performance at 
multiple levels of contractor and government management, insufficient 
executive oversight, and excessive award fee payments to the 
contractor. Specifically, in 2003, an Air Force cost group performed an 
independent cost estimate for NPOESS and found that, based on actual 
outcomes from historical programs similar to NPOESS, the program office 
underestimated contract costs by almost $1 billion. This group also 
concluded that the program office underestimated the required time 
needed to integrate the sensors onto the spacecraft by almost 80 
percent. Despite the differences in planned cost and schedule, the 
program office moved forward with its own estimates--and, in turn, 
established unrealistic budgets that led, in part, to the eventual 
restructuring of the program. 

Further, an independent review team charged with assessing the NPOESS 
program found that the program management office did not sufficiently 
validate the subcontractors' design work on various sensors. As a 
result, the sensors were approved to move into production before they 
reached a sufficient level of technical maturity. This resulted in 
unexpected technical problems during sensor production. 

We also reported that the development issues on one critical sensor 
were attributed, in part, to the subcontractor's inadequate project 
management.[Footnote 8] Specifically, after a series of technical 
problems, internal review teams sent by the prime contractor and the 
program office found that the sensor's subcontractor had deviated from 
a number of contract, management, and policy directives set out by the 
main office and that both management and process engineering were 
inadequate. Neither the contractor nor the program office recognized 
the underlying problems in time to fix them. Further, an independent 
review team reported that the program management office did not have 
the technical system engineering support it needed to effectively 
manage the contractor. In addition, the program office and contractor 
set aside less than 10 percent of their budgets in management reserve-
-an amount which was insufficient to effectively deal with these 
technical problems. With just 2 years into the contract, the prime 
contractor had spent or allocated over 90 percent of its reserves. 

The involvement of the NPOESS executive leadership committee was also 
inconsistent and indecisive--it wavered from frequent heavy involvement 
to occasional meetings with few resulting decisions. In the 32-month 
period from May 2003 through December 2005, the committee met formally 
six times. Despite mounting evidence of the seriousness of the critical 
sensor problems, the committee did not effectively challenge the 
program manager's optimistic assessments, and from May 2003 through 
December 2004, convened only twice to consider the program's 
status.[Footnote 9] 

In May 2006, the Department of Commerce's (Commerce) Inspector General 
reported that the NPOESS award fee structure was not an effective 
system for promoting high-quality performance by the contractor. 
Despite the significant delays and cost overruns on the program, the 
contractor received about 84 percent of the available fee pool for the 
first six billing periods. 

GOES I-M Series: 

In its development of the GOES I-M series, NOAA experienced severe 
technical challenges, massive cost overruns, and risky schedule delays. 
The overall development cost of the program was over three times 
greater than planned, escalating from $640 million to approximately $2 
billion. Additionally, the launch of the first satellite of this 
series, which had been planned for July 1989, did not occur until April 
1994. This nearly 5-year schedule delay left NOAA in danger of losing 
geostationary satellite coverage, although no gap in coverage occurred. 
We reported that these problems were caused by a number of factors, 
including insufficient technical readiness of the satellite design 
prior to contract award, unrealistic cost and schedule estimates, and 
inadequate management by NOAA and NASA.[Footnote 10] 

Specifically, NOAA and NASA did not require any engineering analyses to 
be completed prior to the award of the GOES I-M contract. As a result, 
both agencies were unable to anticipate the level of complexity of 
NOAA's requirements (related to the satellite's pointing accuracy) or 
the contractor's approach to meeting those requirements. This 
unanticipated design complexity led to additional analyses, redesigns, 
and remanufacture of parts, which resulted in increased costs and 
schedule delays. Additionally, the lack of adequate understanding of 
the system prior to contract award also prevented program officials 
from establishing realistic cost and schedule estimates for the 
program. 

The inadequate management of the GOES I-M program--by both the 
government and contractor--played a significant part in its cost 
increases and program delays. Specifically, NASA and NOAA made the 
decision to forgo preliminary studies of the system because of fiscal 
constraints and pressure to launch the first satellite as quickly as 
possible. This decision was compounded by NASA's limited technical 
support in the areas of optics, satellite control systems, and thermal 
engineering. Additionally, both the prime contractor and major 
subcontractor had little experience in directing the design of complex 
weather instruments. The subcontractor had also noted that it was not 
prepared for GOES I-M. For example, the instruments were expected to 
meet manufacturing and testing standards that the subcontractor had 
never experienced before. We recommended Congress consider directing 
NASA and NOAA to report on their progress in resolving these problems 
and the timeframe and cost for achieving proposed solutions. Further, 
we recommended that funds for the production and testing of the 
satellites be withheld until a favorable solution was identified and 
reported to Congress. 

Space Based Infrared System High Program: 

SBIRS-High satellites are being developed to replace DOD's older 
missile warning satellites. In addition to missile warning and missile 
defense missions, the satellites are also expected to perform technical 
intelligence and battlespace characterization missions. After the 
program was initiated in 1994, it faced cost, scheduling, and 
technology problems. SBIRS-High had experienced schedule slips of at 
least 6 years and cost increases that have triggered legislative 
requirements to reassess and recertify the program several times--most 
recently in 2005. While DOD's total program cost estimate was initially 
about $3.9 billion, it is now $9.9 billion--nearly a 150 percent unit 
cost increase. DOD is currently reexamining this program, potential 
alternatives, and cost estimates. 

Our reviews have attributed past problems on the SBIRS-High program to 
serious hardware and software design problems, insufficient oversight 
of contractors, and technology challenges.[Footnote 11] Further, an 
independent review team chartered by DOD reported that a root cause of 
these problems was that system requirements were not well understood by 
DOD when the program began. Specifically, the requirements-setting 
process was often ad hoc, many decisions on requirements were deferred 
to the contractor, and the program was too immature to enter system 
design and development. As a result, there was too much instability on 
the program after the contract award--leading DOD to undertake four 
major replanning efforts. We made multiple recommendations to improve 
this program, including commissioning an independent task force to 
assess the development schedule, the stability of the program design, 
and software development practices, and to provide guidance for 
addressing the program's underlying problems. In addition, we 
recommended that DOD establish a mechanism for ensuring that the 
knowledge gained from the assessment was used to determine whether 
further programmatic changes were needed to strengthen oversight, 
adjust cost and schedule estimates, and address requirements changes. 

Advanced Extremely High Frequency Satellite System: 

AEHF is a satellite system intended to be DOD's next generation of high-
speed, protected communication satellites and to replace the existing 
Milstar system. In 2003, we reported that cost estimates developed by 
the Air Force for this program increased from $4.4 billion in January 
1999 to $5.6 billion in June 2001 for five satellites.[Footnote 12] 
Moreover, DOD would not meet its accelerated target date for launching 
the first satellite in December 2004. To minimize costs, DOD then 
decided to purchase three satellites with options to purchase the 
fourth and fifth--which brought the program cost to $4.7 billion. 
Despite this action, AEHF costs grew to about $6.1 billion--an increase 
of more than 15 percent over the baseline estimate, which triggered 
legislative requirements to assess and certify the program. Schedule 
slippages for launching this communication system have now stretched to 
over 3 years. 

A number of factors contributed to cost and schedule overruns and 
performance shortfalls. First, in the early phases of the AEHF program, 
DOD substantially and frequently altered requirements--resulting in 
major design modifications that increased costs by millions of dollars. 
For instance, a new requirement for additional anti-jamming protection 
led to a cost increase of $100 million and an added set of requirements 
for training, support, and maintainability that cost an additional $90 
million. Second, based on a satellite constellation gap caused by the 
failure of a Milstar satellite, DOD accepted a high-risk schedule that 
turned out to be overly optimistic and highly compressed--leaving 
little room for error and depending on a chain of events taking place 
at certain times. Third, AEHF allocated 4 percent of its budget to 
management reserve--which was an inadequate amount to cover unforeseen 
problems for the duration of the program. Between December 2002 and 
June 2005, the contractor had depleted about 86 percent of its reserves 
with 5 years remaining on the contract. Lastly, at the time DOD decided 
to accelerate the program, it did not have the funding needed to 
support the activities or the manpower needed to design and build the 
satellites more quickly. The lack of funding also contributed to 
schedule delays, which in turn, caused more cost increases. We made a 
number of recommendations to improve this program and others, including 
implementing processes and policies that stabilize requirements and 
addressing shortfalls in staff with science and engineering 
backgrounds. These recommendations were made to assure that DOD had an 
investment strategy in place that would better match resources to 
requirements. 

GOES-R Procurement Activities Are Under Way, but System Requirements 
and Cost Estimates May Change: 

NOAA is nearing the end of the preliminary design phase on its GOES-R 
program and plans to award a contract for the system's development in 
August 2007; however, because of concerns with potential cost growth, 
NOAA's plans for the GOES-R procurement could change in the near 
future. To date, NOAA has issued contracts for the preliminary design 
of the overall GOES-R system to three vendors and expects to award a 
contract to one of these vendors to develop the system in August 2007. 
In addition, to reduce the risks associated with developing new 
instruments, NASA has issued contracts for the early development of one 
critical instrument and for the preliminary designs of four other 
instruments. The agency plans to award these contracts and then turn 
them over to the contractor responsible for the overall GOES-R program. 
However, this approach is under review and NOAA may wait until the 
instruments are fully developed before turning them over to the system 
contractor. Table 5 provides a summary of the status of contracts for 
the GOES-R program. 

Table 5: Status Of Goes-R Program Contracts, As Of June 2006 

Contract item: Instruments: Advanced Baseline Imager; 
Date contract was awarded for design: May 2001; 
Planned date contract will be awarded for development: September 2004 
(actual). 

Contract item: Instruments: Space Environmental In-Situ Suite; 
Date contract was awarded for design: December 2004; 
Planned date contract will be awarded for development: August 2006; 
(actual). 

Contract item: Instruments: Solar Imaging Suite; 
Date contract was awarded for design: September 2004; 
Planned date contract will be awarded for development: September 2006. 

Contract item: Instruments: Hyperspectral Environmental Suite; 
Date contract was awarded for design: June 2004; 
Planned date contract will be awarded for development: June 2007. 

Contract item: Instruments: Geostationary Lightning Mapper; 
Date contract was awarded for design: February 2006; 
Planned date contract will be awarded for development: August 2007. 

Contract item: GOES-R System: Acquisition and Operations; 
Date contract was awarded for design: October 2005; 
Planned date contract will be awarded for development: August 2007. 

Source: NOAA. 

[End of table] 

According to program documentation provided to the Office of Management 
and Budget in 2005, the current life cycle cost estimate for GOES-R is 
approximately $6.2 billion (see table 6). However, program officials 
reported that this estimate is over 2 years old and is under review. 

Table 6: Goes-R Program Life Cycle Cost Estimate, As Of June 2006 

Major cost category: System level; 
Dollars in millions: $533. 

Major cost category: Space segment; 
Dollars in millions: 2,494. 

Major cost category: Ground segments; 
Dollars in millions: 729. 

Major cost category: Launch segment; 
Dollars in millions: 686. 

Major cost category: Operations and support; 
Dollars in millions: 1,147. 

Major cost category: Government program office; 
Dollars in millions: 637. 

Major cost category: Total; 
Dollars in millions: $6,226. 

Source: NOAA. 

[End of table] 

NOAA is tentatively planning to launch the first GOES-R series 
satellite in September 2012. The development of the schedule for 
launching the satellites was driven by a requirement that the 
satellites be available to back up the last remaining GOES satellites 
(GOES-O and GOES-P) should anything go wrong during the planned 
launches of these satellites. Table 7 provides a summary of the planned 
launch schedule for the GOES-R series. 

Table 7: Goes-R Program Schedule, As Of June 2006 

Milestone: GOES-O launch[A]; 
Planned date: April 2008. 

Milestone: GOES-P launch[A]; 
Planned date: October 2009[B]. 

Milestone: GOES-R satellite available for launch; 
Planned date: September 2012. 

Milestone: GOES-S satellite available for launch; 
Planned date: April 2014. 

Milestone: GOES-T satellite available for launch; 
Planned date: October 2015. 

Milestone: GOES-U satellite available for launch; 
Planned date: April 2017. 

Milestone: End of operations and maintenance; 
Planned date: 2028. 

Source: NOAA. 

[A] GOES-O and GOES-P are not part of the GOES-R series program. Their 
launch dates are provided because of their relevance to the GOES-R 
series satellite schedules. 

[B] Because GOES satellites have been operating longer than expected, 
NOAA is considering moving the planned launch of the GOES-P satellite 
to July 2011. 

[End of table] 

Commerce is scheduled to make a major acquisition decision before the 
end of this year. Commerce will decide whether or not the GOES-R series 
should proceed into the development and production phase in December 
2006. Program officials reported that the final request for proposal on 
the GOES-R contract would be released upon completion of this decision 
milestone. 

However, NOAA's plans for the GOES-R procurement could change in the 
near future because of concerns with potential cost growth. Given its 
experiences with cost growth on the NPOESS acquisition, NOAA recently 
asked program officials to recalculate the total cost of the estimated 
$6.2 billion GOES-R program. In May 2006, program officials estimated 
that the life cycle cost could reach $11.4 billion. The agency then 
requested that the program identify options for reducing the scope of 
requirements for the satellite series. Program officials reported that 
there are over 10 viable options under consideration, including options 
for removing one or more of the planned instruments. The program office 
is also reevaluating its planned acquisition schedule based on the 
potential program options. Specifically, program officials stated that 
if there is a decision to make a major change in system requirements, 
they will likely extend the preliminary design phase, delay the 
decision to proceed into the development and production phase, and 
delay the contract award date. NOAA officials estimated that a decision 
on the future scope and direction of the program could be made by the 
end of September 2006. 

The GOES-R Program Office Has Taken Steps to Address Past Lessons 
Learned, but Significant Actions Remain: 

NOAA has taken steps to apply lessons learned from problems encountered 
on other satellite programs to the GOES-R procurement. Key lessons 
include (1) establishing realistic cost and schedule estimates, (2) 
ensuring sufficient technical readiness of the system's components 
prior to key decisions, (3) providing sufficient management at 
government and contractor levels, and (4) performing adequate senior 
executive oversight to ensure mission success. NOAA has established 
plans designed to mitigate the problems faced in past acquisitions; 
however, many activities remain to fully address these lessons. Until 
it completes these activities, NOAA faces an increased risk that the 
GOES-R program will repeat the increased cost, schedule delays, and 
performance shortfalls that have plagued past procurements. 

NOAA Is Taking Steps to Improve the Reliability of Cost and Schedule 
Estimates, but Key Steps Remain in Reconciling Cost Estimates: 

We and others have reported that space system acquisitions are strongly 
biased to produce unrealistically low cost and schedule estimates in 
the acquisition process. For example, we testified last July on the 
continued large cost increases and schedule delays being encountered on 
military space acquisition programs--including NPOESS, SBIRS-High, and 
AEHF.[Footnote 13] We noted that during program formulation, the 
competition to win funding is intense and has led program sponsors to 
minimize their program cost estimates.[Footnote 14] Furthermore, a task 
force chartered by DOD to review the acquisition of military space 
programs found that independent cost estimates and government program 
assessments have proven ineffective in countering this 
tendency.[Footnote 15] NOAA programs face similar unrealistic 
estimates. For example, the total development cost of the GOES I-M 
acquisition was over three times greater than planned, escalating from 
$640 million to $2 billion. The delivery of the first satellite was 
delayed by 5 years. 

NOAA has several efforts under way to improve the reliability of its 
cost and schedule estimates for the GOES-R program. NOAA's Chief 
Financial Officer has contracted with a cost-estimating firm to 
complete an independent cost estimate, while the GOES-R program office 
has hired a support contractor to assist with its internal program cost 
estimating. The program office is re-assessing its estimates based on 
preliminary information from the three vendors contracted to develop 
preliminary designs for the overall GOES-R system. Once the program 
office and independent cost estimates are completed, program officials 
intend to compare them and to develop a revised programmatic cost 
estimate that will be used in its decision on whether to proceed into 
system development and production. In addition, NOAA has planned for an 
independent review team--consisting of former senior industry and 
government space acquisition experts--to provide an assessment of the 
program office and independent cost estimates for this decision 
milestone. To improve its schedule reliability, the program office is 
currently conducting a schedule risk analysis in order to estimate the 
amount of adequate reserve funds and schedule margin needed to deal 
with unexpected problems and setbacks. Finally, the NOAA Observing 
System Council[Footnote 16] submitted a prioritized list of GOES-R 
system requirements to the Commerce Undersecretary for approval. This 
list is expected to allow the program office to act quickly in deleting 
lower priority requirements in the event of severe technical challenges 
or shifting funding streams. 

While NOAA acknowledges the need to establish realistic cost and 
schedule estimates, several hurdles remain. As discussed earlier, the 
agency is considering reducing the requirements for the GOES-R program 
to mitigate the increased cost estimates for the program. Therefore, 
the agency's efforts to date to establish realistic cost estimates 
cannot be fully effective in addressing this lesson until this 
uncertainty is resolved. NOAA suspended the work being performed by its 
independent cost estimator until a decision is made on the scope of the 
program. Further, the agency has not yet developed a process to 
evaluate and reconcile the independent and program office cost 
estimates once final program decisions are made. Without this process, 
the agency may lack the objectivity necessary to counter the optimism 
of program sponsors and is more likely to move forward with an 
unreliable estimate. Until it completes this activity, NOAA faces an 
increased risk that the GOES-R program will repeat the cost increases 
and schedule delays that have plagued past procurements. 

NOAA Is Conducting Preliminary Studies in Order to Avoid Technical 
Problems in Later Acquisition Phases, but Steps Remain in Determining 
Components' Technical Maturity: 

Space programs often experience unforeseen technical problems in the 
development of critical components as a result of having insufficient 
knowledge of the components and their supporting technologies prior to 
key decision points. One key decision point is when an agency decides 
on whether the component is sufficiently ready to proceed from a 
preliminary study phase into a development phase; this decision point 
results in the award of the development contract. Another key decision 
point occurs during the development phase when an agency decides 
whether the component is ready to proceed from design into production 
(also called the critical design review). Without sufficient technical 
readiness at these milestones, agencies could proceed into development 
contracts on components that are not well understood and enter into the 
production phase of development with technologies that are not yet 
mature. For example: 

˛ On the GOES I-M series, NOAA and NASA did not require engineering 
analyses prior to awarding the development contracts in order to 
accelerate the schedule and launch the first satellite. The lack of 
these studies resulted in unexpected technical issues in later 
acquisition phases--including the inability of the original instrument 
designs to withstand the temperature variations in the geostationary 
orbit. 

˛ Both the NPOESS and SBIRS-High programs committed funds for system 
development before the design was proven and before the technologies 
had properly matured. For instance, at the critical design review 
milestone for a key NPOESS sensor, the program office decided that the 
sensor was ready to proceed into production even though an engineering 
model had not been constructed. This sensor has since faced severe 
technical challenges that directly led to program-wide cost and 
schedule overruns. 

To address the lesson learned from the GOES I-M experience, in 1997, 
NOAA began preliminary studies on technologies that could be used on 
the GOES-R instruments. These studies target existing technologies and 
assessed how they could be expanded for GOES-R. The program office is 
also conducting detailed trade-off studies on the integrated system to 
improve its ability to make decisions that balance performance, 
affordability, risk, and schedule. For instance, the program office is 
analyzing the potential architectures for the GOES-R constellation of 
satellites--the quantity and configuration of satellites, including how 
the instruments will be distributed over these satellites. These 
studies are expected to allow for a more mature definition of the 
system specifications. 

NOAA has also developed plans to have an independent review team assess 
project status on an annual basis once the overall system contract has 
been awarded. In particular, this team will review technical, 
programmatic, and management areas; identify any outstanding risks; and 
recommend corrective actions. This measure is designed to ensure that 
sufficient technical readiness has been reached prior to the critical 
design review milestone. The program office's ongoing studies and plans 
are expected to provide greater insight into the technical requirements 
for key system components and to mitigate the risk of unforeseen 
problems in later acquisition phases. 

However, the progress currently being made on the only instrument 
currently under development--the Advanced Baseline Imager--has 
experienced technical problems and could be an indication of more 
problems to come in the future. These problems relate to, among other 
things, the design complexity of the instrument's detectors and 
electronics. As a result, the contractor is experiencing negative cost 
and schedule performance trends. As of May 2006, the contractor 
incurred a total cost overrun of almost $6 million with the 
instrument's development only 28 percent complete. In addition, from 
June 2005 to May 2006, it was unable to complete approximately $3.3 
million worth of work. Unless risk mitigation actions are aggressively 
pursued to reverse these trends, we project the cost overrun at 
completion to be about $23 million. (See app. II for further detail on 
the Advanced Baseline Imager's cost and schedule performance.) 

While NOAA expects to make a decision on whether to move the instrument 
into production (a milestone called the critical design review) in 
January 2007, the contractor's current performance raises questions as 
to whether the instrument designs will be sufficiently mature by that 
time. Further, the agency does not have a process to validate the level 
of technical maturity achieved on this instrument or to determine 
whether the contractor has implemented sound management and process 
engineering to ensure that the appropriate level of technical readiness 
can be achieved prior to the decision milestone. Until it does so, NOAA 
risks making a poor decision based on inaccurate or insufficient 
information--which could lead to unforeseen technical problems in the 
development of this instrument. 

Efforts to Strengthen Government and Contractor Management are Under 
Way, but Significant Work on Program Controls Remains: 

In the past, we have reported on poor performance in the management of 
satellite acquisitions.[Footnote 17] The key drivers of poor management 
included inadequate systems engineering and earned value 
management[Footnote 18] capabilities, unsuitable allocation of contract 
award fees, inadequate levels of management reserve, and inefficient 
decision-making and reporting structure within the program office. The 
NPOESS program office lacked adequate program control capabilities in 
systems engineering and earned value management to effectively manage 
the contractor's cost, schedule, and technical performance. 
Furthermore, Commerce's Inspector General reported that NOAA awarded 
the NPOESS contractor excessive award fees for a program plagued with 
severe technical problems and a consistent failure to meet cost and 
schedule targets.[Footnote 19] Additionally, on SBIRS-High, the program 
management office had fewer systems engineers than other historical 
space programs. As a result, the program did not have enough engineers 
to handle the workload of ensuring that system requirements properly 
flowed down into the designs of the system's components. Further, the 
NPOESS and AEHF programs had less than 5 percent of funds allocated to 
management reserve at the start of the system's development and spent 
or allocated over 85 percent of that reserve within 3 years of 
beginning development. On GOES I-M, NOAA found that it did not have the 
ability to make quick decisions on problems because the program office 
was managed by another agency. 

NOAA has taken numerous steps to restructure its management approach on 
the GOES-R procurement in an effort to improve performance and to avoid 
past mistakes. These steps include: 

˛ The program office revised its staffing profile to provide for 
government staff to be located on-site at prime contractor and key 
subcontractor locations. 

˛ The program office plans to increase the number of resident systems 
engineers from 31 to 54 to provide adequate government oversight of the 
contractor's system engineering, including verification and validation 
of engineering designs at key decision points (such as the critical 
design review milestone). 

˛ The program office has better defined the role and responsibilities 
of the program scientist, the individual who is expected to maintain an 
independent voice with regard to scientific matters and advise the 
program manager on related technical issues and risks. 

˛ The program office also intends to add three resident specialists in 
earned value management to monitor contractor cost and schedule 
performance. 

˛ NOAA has work under way to develop the GOES-R contract award fee 
structure and the award fee review board that is consistent with our 
recent findings, the Commerce Inspector General's findings, and other 
best practices, such as designating a non-program executive as the fee- 
determining official to ensure objectivity in the allocation of award 
fees. 

˛ NOAA and NASA have implemented a more integrated management approach 
that is designed to draw on NASA's expertise in satellite acquisitions 
and increase NOAA's involvement on all major components of the 
acquisition. 

˛ The program office reported that it intended to establish a 
management reserve of 25 percent consistent with the recommendations of 
the Defense Science Board Report on Acquisition of National Security 
Space Programs.[Footnote 20] 

While these steps should provide more robust government oversight and 
independent analysis capabilities, more work remains to be done to 
fully address this lesson. Specifically, the program office has not 
determined the appropriate level of resources it needs to adequately 
track and oversee the program and the planned addition of three earned 
value management specialists may not be enough as acquisition 
activities increase. By contrast, after its recent problems and in 
response to the independent review team findings, NPOESS program 
officials plan to add 10 program staff dedicated to earned value, cost, 
and schedule analysis. An insufficient level of established 
capabilities in earned value management places the GOES-R program 
office at risk of making poor decisions based on inaccurate and 
potentially misleading information. Finally, while NOAA officials 
believe that assuming sole responsibility for the acquisition of GOES- 
R will improve their ability to manage the program effectively, this 
change also elevates NOAA's risk for mission success. Specifically, 
NOAA is taking on its first major system acquisition and an increased 
risk due to its lack of experience. Until it fully addresses the lesson 
of ensuring an appropriate level of resources to oversee its 
contractor, NOAA faces an increased risk that the GOES-R program will 
repeat the management and contractor performance shortfalls that have 
plagued past procurements. 

NOAA Has Established a Senior Executive Committee to Perform Critical 
Oversight of the GOES-R Program: 

We and others have reported on NOAA's significant deficiencies in its 
senior executive oversight of NPOESS.[Footnote 21] The lack of timely 
decisions and regular involvement of senior executive management was a 
critical factor in the program's rapid cost and schedule growth. The 
senior executive committee was provided with monthly status reports 
that consistently described in explicit detail the growing costs and 
delays attributable to the development of a key instrument. Despite 
mounting evidence of the seriousness of the instrument's problems, this 
committee convened only twice between May 2003 and December 2004 to 
consider the program's status. 

NOAA formed its program management council in response to the lack of 
adequate senior executive oversight on NPOESS. In particular, this 
council is expected to provide regular reviews and assessments of 
selected NOAA programs and projects--the first of which is the GOES-R 
program. The council is headed by the NOAA Deputy Undersecretary and 
includes senior officials from Commerce and NASA. The council is 
expected to hold meetings to discuss GOES-R program status on a monthly 
basis and to approve the program's entry into subsequent acquisition 
phases at key decision milestones--including contract award and 
critical design reviews, among others. Since its establishment in 
January 2006, the council has met regularly and has established a 
mechanism for tracking action items to closure. 

The establishment of the NOAA Program Management Council is a positive 
action that should support the agency's senior-level governance of the 
GOES-R program. In moving forward, it is important that this council 
continue to meet on a regular basis and exercise diligence in 
questioning the data presented to it and making difficult decisions. In 
particular, it will be essential that the results of all preliminary 
studies and independent assessments on technical maturity of the system 
and its components be reviewed by this council so that an informed 
decision can be made about the level of technical complexity it is 
taking on when proceeding past these key decision milestones. In light 
of the recent uncertainty regarding the future scope and cost of the 
GOES-R program, the council's governance will be critical in making 
those difficult decisions in a timely manner. 

Conclusions: 

Procurement activities are under way for the next series of 
geostationary environmental satellites, called the GOES-R series-- 
which is scheduled to launch its first satellite in September 2012. 
With the GOES-R system development contract planned for award in August 
2007, NOAA is positioning itself to improve the acquisition of this 
system by incorporating the lessons learned from other satellite 
procurements, including the need to establish realistic cost estimates, 
ensure sufficient government and contractor management, and obtain 
effective executive oversight. However, further steps remain to fully 
address selected lessons. Specifically, NOAA has not yet developed a 
process to evaluate and reconcile the independent and government cost 
estimates. In addition, NOAA has not yet determined how it will ensure 
that a sufficient level of technical maturity will be achieved in time 
for an upcoming decision milestone, or determined the appropriate level 
of resources it needs to adequately track and oversee the program using 
earned value management. Until it completes these activities, NOAA 
faces an increased risk that the GOES-R program will repeat the 
increased cost, schedule delays, and performance shortfalls that have 
plagued past procurements. 

Recent concerns about the potential for cost growth on the GOES-R 
procurement have led the agency to consider reducing the scope of 
requirements for the satellite series. A decision on the future scope 
and direction of the program could by made by the end of September 
2006. Once the decision is made, it will be important to move quickly 
to implement the decision in the agency budgets and contracts. 

Recommendations for Executive Action: 

To improve NOAA's ability to effectively manage the procurement of the 
GOES-R system, we recommend that the Secretary of Commerce direct its 
NOAA Program Management Council to take the following three actions: 

˛ Once the scope of the program has been finalized, establish a process 
for objectively evaluating and reconciling the government and 
independent life cycle cost estimates. 

˛ Perform a comprehensive review of the Advanced Baseline Imager, using 
system engineering experts, to determine the level of technical 
maturity achieved on the instrument, to assess whether the contractor 
has implemented sound management and process engineering, and to assert 
that the technology is sufficiently mature before moving the instrument 
into production. 

˛ Seek assistance from an independent review team to determine the 
appropriate level of resources needed at the program office to 
adequately track and oversee the contractor's earned value management. 
Among other things, the program office should be able to perform a 
comprehensive integrated baseline review after system development 
contract award, provide surveillance of contractor earned value 
management systems, and perform project scheduling analyses and cost 
estimates. 

Agency Comments and Our Evaluation: 

We received written comments on a draft of this report from the 
Department of Commerce (see app. III). In the department's response, 
the Deputy Secretary of Commerce agreed with our recommendations and 
identified plans for implementing them. Specifically, the department 
noted that it plans to establish a process for reconciling government 
and independent cost estimates and to evaluate the process and results 
with an independent team of recognized senior experts in the satellite 
acquisition field. The department also noted that an independent review 
team is planning to perform assessments of the technical maturity of 
the Advanced Baseline Imager and the extent to which the program 
management structure and reporting process will provide adequate 
oversight of the GOES-R system acquisition. Additionally, the 
department expressed concern regarding our use of a cost estimate that 
they considered to be premature and misleading. During the course of 
our review, NOAA provided us with a cost estimate that was later 
determined by agency officials to be inaccurate and was subsequently 
corrected. We have incorporated the revised cost estimate of $11.4 
billion for the overall GOES-R program to ensure that all cost 
estimates reported at this time are accurate. 

The department provided additional technical corrections, which we have 
incorporated as appropriate. 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies of this report 
to interested congressional committees, the Secretary of Commerce, the 
Administrator of NASA, the Director of the Office of Management and 
Budget, and other interested parties. In addition, this report will be 
available at no charge on our Web site at [Hyperlink, 
http://www.gao.gov]. 

If you have any questions on matters discussed in this report, please 
contact me at (202) 512-9286 or by e-mail at pownerd@gao.gov. Contact 
points for our Offices of Congressional Relations and Public Affairs 
may be found on the last page of this report. GAO staff who made major 
contributions to this report are listed in appendix IV. 

Signed by: 

David A. Powner: 
Director, Information Technology Management Issues: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

Our objectives were to (1) determine the status of and plans for the 
Geostationary Operational Environmental Satellites-R series (GOES-R) 
procurement and (2) identify and evaluate the actions that the project 
management team is taking to ensure that past problems experienced in 
procuring other satellite programs are not repeated. To accomplish 
these objectives, we focused our review on the National Oceanic and 
Atmospheric Administration's (NOAA) GOES-R program office, the 
organization responsible for the overall GOES-R program. 

To determine the status of and plans for the GOES-R series procurement, 
we reviewed various program office plans and management reports such as 
acquisition schedules, cost estimates, and planned system requirements. 
Furthermore, we conducted interviews with NOAA and National Aeronautics 
and Space Administration (NASA) officials to determine key dates for 
future GOES-R acquisitions efforts and milestones, and potential 
changes in program scope, cost, and schedule. 

To identify the steps the GOES-R project management team is taking to 
ensure that past problems experienced in procuring other satellite 
series are not repeated, we analyzed our past body of work on major 
space system acquisitions, including the Advanced Extremely High 
Frequency satellites, the GOES I-M satellites, the National Polar- 
orbiting Operational Environmental Satellite System, and the Space 
Based Infrared System High program in order to identify key lessons. We 
also analyzed findings from other government reports on satellite 
procurements, such as by the Defense Science Board-Air Force Scientific 
Advisory Board Joint Task Force and the Department of Commerce's Office 
of Inspector General. We assessed relevant management documents, such 
as cost reports and program risk plans. Our evaluation included the 
application of earned value analysis techniques[Footnote 22] to data 
from contractor cost performance reports over an 11-month period (from 
June 2005 to May 2006). We also conducted interviews with agency 
officials to identify and to evaluate the adequacy of the actions taken 
to address these lessons. 

We obtained comments on a draft of this report from officials at the 
Department of Commerce and incorporated these comments as appropriate. 
We performed our work at NOAA and NASA offices in the Washington, D.C., 
metropolitan area between December 2005 and August 2006 in accordance 
with generally accepted government auditing standards. 

[End of section] 

Appendix II: Current Shortfalls in Contractor Performance on Key 
Instrument Development: 

The development of one of the critical GOES-R instruments, the Advanced 
Baseline Imager (ABI), is experiencing technical challenges and, as a 
result, the contractor is missing cost and schedule targets. Despite 
the uncertainty regarding the future scope of the GOES-R program, it is 
expected that the requirements for this instrument will not change. 

Contractor-provided data from June 2005 to May 2006 indicates that 
ABI's cost performance is experiencing a trend of negative variances. 
Figure 4 shows the 11-month cumulative cost variance for the ABI 
contract. As of May 2006, the contractor has incurred a total cost 
overrun of almost $6 million with ABI development only 28 percent 
complete. This information is useful because trends tend to continue 
and can be difficult to reverse unless management attention is focused 
on key risk areas and risk mitigation actions are aggressively pursued. 
Studies have shown that, once work is 15 percent complete, the 
performance indicators are indicative of the final outcome. 

Based on contractor performance from June 2005 to May 2006, we 
estimated that the current ABI instrument contract--which is worth 
approximately $360 million--will overrun its budget by between $17 
million and $47 million. Our projection of the most likely cost overrun 
will be about $23 million. The contractor, in contrast, estimates about 
a $7 million overrun at completion of the ABI contract. Given that the 
contractor has 72 percent of work remaining and has already accumulated 
a cost overrun of $5.9 million, the likelihood that the contractor will 
meet its estimated projection is small. 

Figure 4: Cumulative Cost Variance of the ABI Instrument Contract over 
an 11-month Period: 

[See PDF for image] 

Source: GAO analysis based on NOAA data. 

[End of figure] 

Our analysis also indicates that the contractor has been unable to meet 
its planned schedule targets. Figure 5 shows the 11-month cumulative 
schedule variance for the ABI contract. From June 2005 to May 2006, the 
contractor was unable to complete approximately $3.3 million worth of 
scheduled work. The contractor reported that its incorporation of 
revised subcontractor budgets resulted in the fluctuations in schedule 
performance data prior to March 2006. The current inability to meet 
contract schedule performance could be a predictor of future rising 
costs, as more spending is often necessary to resolve schedule 
overruns. 

Figure 5: Cumulative Schedule Variance of the ABI Instrument Contract 
over an 11-month Period: 

[See PDF for image] 

Source: GAO analysis based on NOAA data. 

[End of figure] 

According to contractor-provided documents, the cost and schedule 
overruns were primarily caused by design complexity issues experienced 
in the development of the instrument's detectors and the electronics 
design for the cryocooler[Footnote 23] and the unplanned time and 
manpower expended to resolve these issues. Other significant cost and 
schedule drivers include software issues on the scanner and supplier 
quality issues on some parts. 

[End of section] 

Appendix III: Comments from the Department of Commerce: 

The Deputy Secretary Of Commerce: 
Washington, D.C. 20230: 

August 24, 2006: 

Mr. David A. Powner: 
Director: 
Information Technology Management Issues: 
U.S. Government Accountability Office: 
441 G Street, NW: 
Washington, D.C. 20548: 

Dear Mr. Powner: 

Thank you for the opportunity to review and comment on the Government 
Accountability Office's draft report entitled Geostationary Operational 
Environmental Satellites: Steps Remain in Incorporating Lessons Learned 
from Other Satellite Programs (GAO-06-993). I enclose the Department of 
Commerce's comments to the draft report. 

Sincerely, 

Signed by: 

David A. Sampson: 

Enclosure: 

Department of Commerce's Comments on the Draft GAO Report Entitled 
"Geostationary Operational Environmental Satellites: Steps Remain in 
Incorporating Lessons Learned from Other Satellite Programs" (GAO-06- 
993/September 2006): 

General Comments: 

The Department of Commerce appreciates the opportunity to review this 
report on Geostationary Operational Environmental Satellites, 
specifically the R-Series (GOES-R). The report does a fair and thorough 
job identifying past satellite program shortfalls and assessing GOES-R 
efforts to leverage lessons learned from previous programs. Although 
not specifically identified in the GAO recommendations, the report 
notes the National Oceanic and Atmospheric Administration (NOAA) is 
taking on its first major system acquisition with GOES-R, which entails 
increased risk due to NAAA's limited experience. As observed by the GAO 
at several points in the report, NOAA has taken numerous steps to 
strengthen its management approach and to incorporate lessons learned 
to ensure effective program performance. Among these actions are 
increasing systems engineering staff, co-locating government staff at 
prime and subcontractor locations, incorporating recent GAO and 
Department of Commerce's Office of Inspector General recommendations 
concerning contract award fee structure, establishing a Program 
Management Council to provide regular review and assessment of the GOES-
R program, and implementing comprehensive independent review of the 
program. In addition, NOAA is evaluating DOC/NOAA and the National 
Aeronautics and Space Administration roles to ensure NASA's spacecraft 
acquisition expertise is effectively leveraged. NOAA is scheduled to 
provide DOC with an assessment on this issue this fall. NOAA believes 
these steps will enable NOAA to effectively manage the GOES-R 
acquisition; we will continue to assess the need for additional 
actions, particularly in response to findings from the independent 
review teams, and will take the necessary actions to ensure effective 
performance on this critical acquisition. 

NOAH concurs with the recommendations identified by the GAO in the 
report, as discussed below. The report's discussion of the Advanced 
Baseline Imager (ABI) earned value management (EVM) shortfalls is being 
addressed. NOAA remains concerned with the report's use of a premature 
and misleading cost estimate in a number of places. Specific instances 
are addressed in the technical comments section of this response. 

NOAA Response to GAO Recommendations: 

The draft GAO report states, "To improve NAAA's ability to effectively 
manage the procurement of the GOES-R system, we recommend that the 
Secretary of Commerce direct its NOAA Program Management Council to 
take the following three actions:" 

Recommendation 1: "once the scope of the program has been finalized, 
establish a process for objectively evaluating and reconciling the 
government and independent life cycle cost estimates." 

NOAA Response: NOAA agrees with this recommendation. As the program 
scope is being finalized, NOAA will establish a process for evaluating 
and reconciling government and independent life cycle cost estimates, 
and will vet the process and results with an independent review team 
comprised of recognized senior experts in the satellite acquisition 
field. 

Recommendation 2: "perform a comprehensive review of the Advanced 
Baseline Imager, using system engineering experts, to determine the 
level of technical maturity achieved on the instrument, to assess 
whether the contractor has implemented sound management and process 
engineering, and to assert that the technology is sufficiently mature 
before moving the instrument into production." 

NOAA Response: NOAA agrees with this recommendation. Comprehensive 
reviews, including independent systems and technical reviews, are being 
performed. In addition to the extensive NASA processes described below, 
the GOES-R Independent Review Team is also looking at the ABI and other 
instruments and providing its assessment of their technical maturity 
and their level of risk to the program. 

NASA Goddard Space Flight Center (GSFC) has implemented the requested 
processes in its "Integrated Independent Reviews" (IIRs). Each NASA 
GSFC space flight hardware development contract is subject to IIRs 
throughout the development cycle up to launch. The processes that are 
followed are documented in: GPR 8700.4F - Integrated Independent 
Reviews, GSFC STD 1001 - Criteria for Flight Project Critical Milestone 
Reviews, and GSFC STD 1000 - Rules for the Design, Development, 
Verification, and Operation of Flight Systems. The Integrated 
Independent Review Teams (IIRTs) for GOES-R are co-chaired by NASA and 
The Aerospace Corporation. The IIRT membership is comprised of NASA 
Engineering and Systems Safety and Mission Assurance, Aerospace 
Corporation, and NOAA personnel from outside of the GOES-R Program/ 
Projects. The IIRTs ensure that each development effort has achieved 
the level of technical/design maturity required for the given phase of 
the effort and that the appropriate processes are in place and are 
followed. The ABI instrument and the ITT Industries Management Team 
have been subjected to two IIRs to date: the System Concept Review 
(SCR) in February 2005 and the Preliminary Design Review (PDR) in 
December 2005. The next IIR is the Critical Design Review (CDR), which 
is tentatively scheduled for February 2007. 

Recommendation 3: "seek assistance from an independent review team to 
determine the appropriate level of resources needed at the program 
office to adequately track and oversee the contractor's earned value 
management. Among other things, the program office should be able to 
perform a comprehensive integrated baseline review after system 
development contract award, provide surveillance of contractor earned 
value management systems, and perform project scheduling analyses and 
cost estimates." 

NOAA Response: NOAA agrees with this recommendation, and has included 
within the scope of the Independent Review Team an assessment of the 
extent to which the program management structure and reporting process 
will provide adequate oversight, and assessment of whether or not the 
program is adequately staffed in terms of personnel numbers and skills. 
The Independent Review Team is examining these elements and will 
provide recommendations concerning this, to which the program will 
respond. 

The GOES-R Program Office currently plans to bring at least three EVM 
specialists on board, and has subjected these plans to independent 
review. In addition, the program is prepared to leverage additional 
lessons learned from other programs. 

EVM will remain a factor in award fee determinations for the ABI 
developer. NOAH recognizes the importance of EVM and realizes that EVM 
is an effective management tool, not a substitute for good program 
management. Mission success is the key, and decisions will continue to 
be made to ensure GOES-R is developed to meet performance requirements. 
The GOES-R Program Office has made and implemented important management 
actions to ensure mission success-including the use of on-site resident 
managers who are able to oversee the procurement at the contractor's 
facility. 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

David A. Powner, (202) 512-9286 or pownerd@gao.gov. 

Staff Acknowledgments: 

In addition to the contact named above, Carol Cha, Neil Doherty, Nancy 
Glover, Kush Malhotra, Colleen Phillips, and Karen Richey made key 
contributions to this report. 

[End of section] 

(310827): 

FOOTNOTES 

[1] Earned value management is a method that compares the value of work 
accomplished during a given period with that of the work expected in 
that period. 

[2] Satellites in a series are identified by letters of the alphabet 
when they are on the ground and by numbers once they are in orbit. 

[3] The instruments were based on 1980s technology. 

[4] GAO, Defense Acquisitions: Space System Acquisition Risks and Keys 
to Addressing Them, GAO-06-776R (Washington, D.C.: June 1, 2006); Polar-
orbiting Operational Environmental Satellites: Cost Increases Trigger 
Review and Place Program's Direction on Hold, GAO-06-573T (Washington, 
D.C.: Mar. 30, 2006); Polar-orbiting Operational Environmental 
Satellites: Technical Problems, Cost Increases, and Schedule Delays 
Trigger Need for Difficult Trade-off Decisions, GAO-06-249T 
(Washington, D.C.: Nov. 16, 2005); Polar-orbiting Environmental 
Satellites: Information on Program Cost and Schedule Changes, GAO-04-
1054 (Washington, D.C.: Sept. 30, 2004); Defense Acquisitions: Despite 
Restructuring, SBIRS High Program Remains at Risk of Cost and Schedule 
Overruns, GAO-04-48 (Washington, D.C.: Oct. 31, 2003); Military Space 
Operations: Common Problems and Their Effects on Satellite and Related 
Acquisitions, GAO-03-825R (Washington, D.C.: June 2, 2003); Defense 
Acquisitions: Assessments of Major Weapon Programs, GAO-03-476 
(Washington, D.C.: May 15, 2003); Weather Satellites: Action Needed to 
Resolve Status of the U.S. Geostationary Satellite Program, GAO/NSIAD-
91-252 (Washington, D.C.: July 24, 1991). Defense Science Board/Air 
Force Scientific Advisory Board Joint Task Force, Report on the 
Acquisition of National Security Space Programs (May 2003). 

[5] GAO-04-1054. 

[6] GAO-06-573T and GAO-06-249T. 

[7] 10 U.S.C. section 2433, as amended by Pub. Law No. 109-163, Div. A, 
section 802 (Jan. 6, 2006). 

[8] GAO-06-249T. 

[9] Department of Commerce Office of Inspector General, Poor Management 
Oversight and Ineffective Incentives Leave NPOESS Program Well Over 
Budget and Behind Schedule, OIG-17794-6-0001 (May 8, 2006). 

[10] GAO/NSIAD-91-252. 

[11] GAO-04-48 and GAO-03-476. 

[12] GAO-03-825R and GAO-03-476. 

[13] GAO, Space Acquisitions: Stronger Development Practices and 
Investment Planning Needed to Address Continuing Problems, GAO-05-891T 
(Washington, D.C.: July 12, 2005). 

[14] GAO-05-891T. 

[15] Defense Science Board/Air Force Scientific Advisory Board Joint 
Task Force, Report on the Acquisition of National Security Space 
Programs (May 2003). 

[16] NOAA's Observing System Council is the principal advisory council 
for NOAA's earth observation and data management activities. It 
includes members from each NOAA line office, other relevant councils, 
and program offices. The Assistant Administrator for Satellite and 
Information Services and the Assistant Administrator for Weather 
Services serve as the co-chairs of the council. 

[17] GAO-06-573T, GAO-06-249T, GAO/NSIAD-91-252, Defense Acquisitions: 
DOD Has Paid Billions in Award and Incentive Fees Regardless of 
Acquisition Outcomes, GAO-06-66 (Washington, D.C.: Dec. 19, 2005), and 
Weather Satellites: Cost Growth and Development Delays Jeopardize U.S. 
Forecasting Ability, GAO/NSIAD-89-169 (Washington, D.C.: June 30, 
1989). 

[18] Earned value management is a method, used by DOD for several 
decades, to track a contractor's progress in meeting project 
deliverables. It compares the value of work accomplished during a given 
period with that of the work expected in that period. Differences from 
expectations are measured in both cost and schedule variances. 

[19] Department of Commerce Office of Inspector General, Poor 
Management Oversight and Ineffective Incentives Leave NPOESS Program 
Well Over Budget and Behind Schedule, OIG-17794-6-0001 (May 8, 2006). 

[20] Defense Science Board/Air Force Scientific Advisory Board Joint 
Task Force, Report on the Acquisition of National Security Space 
Programs (May 2003). 

[21] GAO, Polar-orbiting Environmental Satellites: Cost Increases 
Trigger Review and Place Program's Direction on Hold, GAO-06-573T 
(Washington, D.C.: March 30, 2006); Department of Commerce Office of 
Inspector General, Poor Management Oversight and Ineffective Incentives 
Leave NPOESS Program Well Over Budget and Behind Schedule, OIG-17794-6- 
0001 (May 8, 2006). 

[22] The earned value concept is applied as a means of placing a dollar 
value on project status. It is a technique that compares budget versus 
actual costs versus project status in dollar amounts. For our analysis, 
we used standard earned value formulas to calculate cost and schedule 
variance and forecast the range of cost overrun at contract completion. 

[23] The cryocooler is a key component of the ABI instrument. It is 
intended to cool down components of the instrument. 

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