Air Traffic Control:

FAA's Advanced Automation System Acquisition Strategy Is Risky

IMTEC-86-24: Published: Jul 8, 1986. Publicly Released: Jul 8, 1986.

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GAO reviewed the Federal Aviation Administration's (FAA) acquisition of the Advanced Automation System (AAS) to determine whether it is a technically and economically sound investment.

GAO found that: (1) the current AAS acquisition strategy does not adequately mitigate technical risks and does not provide for suitable operational simulation of the advanced automation features; and (2) AAS, as currently planned, may not be economically justified. GAO believes that the FAA strategy has unacceptably high risks and may result in significant cost increases, schedule delays, and performance deficiencies. GAO also believes that: (1) a fixed price for untested hardware may result in higher costs because the contractor's risk may be reflected in higher fixed prices to compensate for the system's unproven producibility; (2) requirement changes to correct performance problems can lead to significant additional costs even in a fixed-price contract; (3) software, which constitutes a major portion of AAS development, and cost risk will be developed using a cost-plus type contract; and (4) having only one contractor during the concurrent development, test, and production phase limits risk-reduction opportunities typically achieved through cost and technical competition.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: FAA revised the acquisition strategy to develop and test critical components before production, reducing risks of producing a system requiring costly changes to perform satisfactorily. By deferring large production costs from 1988 to 1991, the change also leads to better use of funds and measurable accomplishment of $332 million in fiscal year (FY) 1988 and $250 million for future years.

    Recommendation: The Secretary of Transportation should direct FAA to revise its AAS acquisition strategy to incorporate a contract phase to develop and operationally test prototype models of critical components under realistic conditions before the decision and contract award are made for full production quantities. At a minimum, critical components should include the controller workstations, en route hardware and software, and the local communications network.

    Agency Affected: Department of Transportation

  2. Status: Closed - Implemented

    Comments: FAA reduced or eliminated cost driving requirements resulting in estimated program savings of $632 million over the 12-year acquisition period. This action results in another measurable accomplishment of $52.67 million in FY 1988 and an equal amount for future years, based on the assumption that savings will occur equally over the 12-year acquisition period.

    Recommendation: The Secretary of Transportation should direct FAA to reexamine AAS features and requirements to identify the most inexpensive and cost-effective alternatives and to revalidate requirements before proceeding to the development and testing phase.

    Agency Affected: Department of Transportation

  3. Status: Closed - Implemented

    Comments: Simulation will increase the probability of deploying timely, state-of-the-art functions, thus providing unmeasurable system performance and cost-reduction benefits.

    Recommendation: The Secretary of Transportation should direct FAA to verify the benefit estimates and the operational suitability of Aera 1 and Aera 2 functional enhancements by operational simulation as soon as it is practicable, and before proceeding with full-scale production.

    Agency Affected: Department of Transportation

 

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