NASA Procurement:

Agencywide Action Needed to Improve Management of Contract Modifications

NSIAD-92-87: Published: Mar 2, 1992. Publicly Released: May 7, 1992.

Additional Materials:


David R. Warren
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Pursuant to a congressional request, GAO assessed the causes and management of 65 cost and schedule modifications to contracts administered by the National Aeronautics and Space Administration's (NASA) four largest procurement centers.

GAO found that: (1) such NASA center actions as changing contract terms, specifications, or scope caused more than half of the 65 cost and schedule modifications, with contractor performance causing 19 percent of changes and unforeseen and uncontrollable circumstances causing 29 percent of the modifications; (2) NASA could have resolved some of the problems causing the need to make the modifications, including defective or incomplete plans, specifications, and work statements, before awarding the contracts; (3) the 65 modifications collectively increased the contracts' costs by about $51 million and extended delivery schedules by about 21 years; (4) NASA centers experienced such contract administration problems as noncompetitive addition of new work without sole-source justification, untimely completion of contract change negotiations, unauthorized personnel directing contractors to perform additional work, and inadequate evaluation of proposed contract changes; (5) although NASA uses procurement management surveys to evaluate the quality and effectiveness of its procurement operations, its actions to correct identified problems have not always been effective or timely; and (6) NASA conducts procurement management surveys too infrequently, and the survey methodology is sometimes too inflexible or too broadly focused for maximum effectiveness.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The NASA Federal Acquisition Regulation Supplement was published in January 1994 to implement a program of mandatory training for technical representatives.

    Recommendation: The Administrator, NASA, should establish and enforce minimum training requirements for technical representatives that emphasize their role and responsibilities, scope of authority, and relationship to other members of the procurement management team.

    Agency Affected: National Aeronautics and Space Administration

  2. Status: Closed - Implemented

    Comments: NASA is developing a training and policy initiative to implement a program of mandatory training for technical representatives. In addition, contracting officers have been reminded of their responsibilities regarding technical evaluations.

    Recommendation: The Administrator, NASA, should direct contracting officers to enforce requirements that technical representatives perform and document adequate technical evaluations.

    Agency Affected: National Aeronautics and Space Administration

  3. Status: Closed - Implemented

    Comments: Contracting officers' responsibilities pertaining to new work modifications to existing contracts are covered under the agency's new contract and subcontract management training course which will train all permanent personnel at NASA.

    Recommendation: The Administrator, NASA, should ensure that appropriate NASA personnel at the center where GAO found instances of unjustified, noncompetitive additions of new work to existing contracts understand the factors to consider in deciding on and justifying such additions.

    Agency Affected: National Aeronautics and Space Administration

  4. Status: Closed - Implemented

    Comments: The Assistant Administrator of Procurement has already taken steps that comply with the objective of this recommendation. Center reviews by procurement management survey teams are being varied in frequency depending on the results of each review. Staff from the Contract Management Division serve as members of each survey team in order to focus on specific areas of contract management weaknesses.

    Recommendation: The Administrator, NASA, should adjust the frequency of procurement management surveys and alter their scope, at least on a selective basis, to determine the causes of contract administration problems. Such surveys should also be planned to recognize differences among centers and focus on those areas of the procurement process that have been previously identified as potential problems.

    Agency Affected: National Aeronautics and Space Administration


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