Text of letter from NASA Advisory Council to Administrator Goldin
Text of letter from Advisory Committee on the International Space Station to the NASA Advisory Council
Text of letter from Cost Assessment
and Validation Task Force on the International Space Station to
NASA Advisory Council and dvisory Committee on the International
Space Station
Figure 2-1. Fiscal Years 1998 and 1999 Budgets
Figure 2-2 Fiscal Year Budget by Components
Figure 2-3. Components Budget by Fiscal Year
Figure 3-1. Overrun Trend
Figure 3-2. Staffing Projections
Figure 3-3. Fiscal Year 1998 Civil Service Staffing Levels
Figure 3-4. Schedule Milestone Trends
Figure 3-5. CAV Task Force Schedule Assessment
Figure 3-6. Impact of Schedule Stretchout
Figure 3-7. Assessment of Reserves
Figure 3-8. CAV Task Force Budget Recommendations
Figure 3-9. CAV Funding Assessment
Table 3-1. Estimates of Schedule Slippage
Table 3-2. Estimates of Cost Growth
Table 3-3. CAV Task Force Budget Recommendations
April 21, 1998
Daniel S. Goldin
Administrator
National Aeronautics and
Space Administration
300 E Street SW
Washington, DC 20546-0001
Dear Mr. Goldin:
The NASA Advisory Council has completed the independent assessment
of the International Space Station (ISS) program that you directed
be done. At our meeting on March 19, 1998, Jay Chabrow presented
the findings of the Cost Assessment and Validation (CAV) Task
Force of the Advisory Committee on the International Space Station
(ACISS).
The Task Force assessed the validity of NASA's projections and
provided its own estimation of the remaining cost and schedule
for ISS completion. The Task Force members have considerable experience
and broad knowledge of all aspects of program management and cost
forecasting of technical development programs. The Council found
the methodology and result to be credible.
The CAV Task Force reported that the most probable schedule slip
is 24 months with a range of 10 months to 38 months. It also determined
that additional funding in the range of $130 to $250 million annually
will be necessary through completion of assembly. The Council
believes these findings to be consistent with the level of growth
that would be expected given the significant complexity of the
ISS program.
Mr. Goldin, please be assured that the enclosed assessment is
truly independent; neither the ACISS nor the Council has influenced
or altered it.
The documents that NASA provided to Congress have been reviewed
for consistency with the earlier drafts on which the CAV Task
Force assessment was based. The assessment of those areas of Congressional
concern is unchanged and is reflected in the report.
Sincerely,
Bradford Parkinson
Chair
Enclosures
Dr. Bradford Parkinson
Chairman
NASA Advisory Council
NASA Headquarters
Washington, DC 20546
Dear Brad,
The Cost Assessment and Validation Task Force (CAV), with Mr.
Jay Chabrow as Chairman, was established at the request of the
NASA Administrator. The CAV charter was to perform an independent
review and assessment of costs, budgets, and partnership performance
on the International Space Station (ISS) program and to provide
advice and recommendations. Enclosed is the CAV final report dated
April 15, 1998.
The Advisory Committee on the International Space Station (ACISS)
reviewed the CAV results at a committee meeting on March 12, 1998
and has completed a review of the final report. Special actions
were taken by the ACISS to ensure that the CAV review and assessment
was independent. ACISS comments from both reviews were provided
to the CAV, and the Task Force had total authority to determine
disposition. The CAV final report is truly an independent review
and assessment.
Task Force members are experienced professionals with significant
experience in the management of major space projects. Their conclusions
are based on fact finding by participation in NASA meetings and
visits to facilities of major ISS participants, analyses performed
by the CAV, and the collective judgment of the members. CAV conclusions
include a likely delay in the completion of the ISS assembly from
one to three years beyond December 2003 and additional annual
funding of between $130 million and $250 million relative to the
ISS fiscal year 1999 budget to Congress. The CAV findings are
reasonable and credible given a program of such complexity.
Sincerely
A. Thomas Young
Chairman, Advisory Committee on the International Space Station
Enclosure
April 15, 1998
Dr. Bradford Parkinson
Chair
NASA Advisory Council
National Aeronautics and Space Administration
Washington, DC 20546
Mr. A. Thomas Young
Chair
Advisory Committee on the International Space Station
12921 Esworthy Rd.
Potomac, Maryland 20878
Dear Brad and Tom:
The Cost Assessment and Validation Task Force has completed its
independent review and assessment of costs, budgets, and partnership
performance of the International Space Station (ISS). You will
find the report content is largely consistent with the overall
findings briefed to the NASA Advisory Committee on the ISS and
the NASA Advisory Council at earlier meetings. The enclosed report
contains the specific analyses from which the overall assessment
was generated.
Two of the more significant findings in the report are estimates
that the cost of the ISS will increase from $130 million to $250
million each year over the NASA fiscal year 1999 budget submittal,
and that the program will extend beyond its current schedule by
one to three years.
I can not say enough about the individual people who contributed
their considerable time and vast experience to the generation
of this report. We are extremely confident in the accuracy of
our findings and hope that this report contributes to a better
understanding of this vital space-based international resource.
Sincerely,
Mr. Jay Chabrow
Chairman, Cost Assessment and
Validation Task Force
Enclosures
The Cost Assessment and Validation (CAV) Task Force was established
for independent review and assessment of cost, schedule and partnership
performance on the International Space Station (ISS) Program.
The CAV Task Force has made the following key findings:
1.1 Background
The International Space Station emanates from
a 1993 NASA cost reduction-based redesign of the Space Station
Freedom. NASA committed to build the new design within a $2.1
billion annual funding constraint and at a total cost to completion
of $17.4 billion. Now, nearly five years later, hardware manufacturing
for many of the first U.S.-developed flight elements has been
completed. The program is well into the test and integration phase,
preparing for the start of deployment later this year.
Progress on the ISS Program has been achieved
by overcoming a variety of challenges. In 1997, cost growth
and delivery delays, both in the U.S. and abroad, made considerable
news. In May 1997, the ISS First Element Launch (FEL) was deferred
by seven months from November 1997 to June 1998. In September
1997, after coordination with the International
Partners on out-year ISS assembly flights, a new manifest
was released that reflected a slip of over a year in completion
of ISS assembly. These events and others have raised questions
regarding the total cost and schedule for ISS development and
operations.
In September 1997, the NASA Administrator asked Dr. Brad Parkinson
to establish a Cost Assessment and Validation Task Force, reporting
through the Advisory Committee on the International Space Station
(ACISS) to the NASA Advisory Council, for independent review and
assessment of cost, schedule and partnership performance on the
ISS Program. The letter of request is in Appendix A. The objective
of the Task Force, chaired by Mr. Jay Chabrow, was to provide
advice and recommendations for improvement of the ISS business
structure and cost management practices and to determine the total
cost over the life of the Program. The Task Force Terms of Reference
are in Appendix B.
On October 6, 1997, the Senate-House Conference Committee submitted
Conference Report 105-297. This report specified certain NASA
reporting requirements to Congress as a precondition to the March
1998 Congressional release of $851,300,000 in FY 1998 ISS funding.
The following items were required of NASA by Congress:
NASA requested the CAV Task Force to perform this independent
assessment, either verifying NASA's data or explaining reasons
for lack of verification. The letter making that request is in
Appendix C, and the Task Force's assessment is in Appendix D.
Six additional experts made up the Task Force. Their biographies
are in Appendix E. The members were selected to obtain a diversity
of expertise in program management, cost estimation and formulation,
technology development, and cost and schedule risk assessment,
so that all aspects of the ISS Program could be analyzed and assessed.
Task Force members have backgrounds in industry, the federal government,
and the military and have experience in large-scale aerospace
and other technology development programs.
1.2 CAV Task Force Organization and Process
Three members of the CAV Task Force, who were serving as technical
consultants on the ACISS, attended detailed budget reviews at
each of the Prime contractor's production sites in October, 1997.
The official kick-off meeting of the Cost Assessment and Validation
Task Force was on November 6, 1997.
Since the team's initial meeting, members of the CAV Task Force have met almost weekly. The team was given open access to every facet of NASA's ISS Program. Fact-finding trips were made for meetings with ISS Program management, line support organization personnel, and the Program's Prime Contractor. The CAV Task Force met with representatives of the European Space Agency (ESA) and the Russian Space Agency (RSA) at their production sites to gain first-hand knowledge of their performance. Representatives of Alenia Aerospazio, Turin, Italy, who are responsible for the delivery of several U.S. and European elements also briefed the CAV Task Force on their progress.
The Task Force's fact-finding focused on major aspects of past
performance trends, current performance, and estimated projections
by the ISS Program. The main thrust was to identify and evaluate
major risk elements that would likely contribute
to further cost growth and schedule slip. Pertinent information
was gathered through summary and detailed status briefings, special
topics briefings, site visits, and personal interviews with ISS
program and line management and support personnel, and in conversations
with other government oversight organizations. The compiled information
was reviewed to assess the major impediments which could affect
timely completion of the ISS.
1.3 Findings
1.3.1 Development
The ISS Program has been diligent and resourceful in managing
the unique challenges of this complex venture given the significant
complexity and uncertainty of international involvement and the
difficult task of staying within annual and total funding caps
established prior to final Program content definition. The Program
has not incurred any extraordinary technical or programmatic "show
stoppers" to date. Although cost and schedule growth have
occurred, the magnitude of such growth has not been unusual, even
when compared with other developmental programs of lesser complexity.
The $2.1 billion annual funding limitation has resulted in spread-out
procurements, deferred and untimely work, and inadequate contingency
planning, all of which have induced schedule delays and have increased
cost. NASA's cost and schedule plans have been optimistic from
the beginning of the Program and continue to be so today. Budget
and reserve levels have been, and continue to be, inadequate for
a program of this size, complexity, and development uncertainty
despite NASA's past contentions that the total funding level is
adequate. It could alternatively be stated that the Program has
more content than it has funds available to achieve.
In the Task Force's opinion, Program de-staffing goals do not
adequately account for: work yet to be accomplished, mitigation
of current and potential cost and schedule risks, and the retention
of an appropriate skill mix through completion of development.
The Task Force analyzed ISS de-staffing plans for several prior
years and found they were not achieved for reasons similar to
those noted above. Current development de-staffing plans require
Prime contractor off-loads at a greater rate than all previous
plans. Past trends clearly indicate that this is not a realistic
assumption. Therefore, the Task Force believes that attempting
to adhere to the current de-staffing plans is unreasonable and
will introduce additional cost and schedule risks that could otherwise
be avoided.
Management challenges will remain large and diverse considering
the significant on-orbit assembly tasks; the size and breadth
of the integration required; the splintered delegation of systems
integration functions; and the required coordination responsibilities
among NASA, its Prime contractor and International Partners. ISS
Program management, primarily due to past annual funding constraints,
has not fully developed and implemented cost and schedule risk
mitigation plans to minimize or eliminate larger schedule stretchouts
or increased costs.
Major Development Risk Elements
There are a significant number of cost and schedule growth risks
in a program of this magnitude that have direct implications to
the total development cost of the Program and to the schedule
for completion of assembly. The following list represents the
major development risk elements the Task Force identified in the
ISS program.
The Program has produced over 300,000 pounds of flight hardware and is scheduled to double this amount by the end of 1998; however, much of the hardware and software production is behind plan or still undergoing development and qualification testing. Additional cost growth potential resides in the fact that various contractor staff will remain on contract longer than planned, as the Program completes qualification, integration, and verification testing activities.
This phase of the ISS Program requires simultaneous
integration of launch operations, on-orbit assembly operations,
engineering support, and logistics and maintenance support with
mission operations over an extended period of time. The
full assembly sequence for ISS will span a period in excess of
five and one-half years, involving over 93 flights of multiple
booster types to assemble and check out, on orbit, hardware from
around the world. The overall complexity and scope of this effort
is beyond the current experience base of NASA and the International
Partners and, as such, contain cost and schedule
uncertainties and risks. The resource estimates, in terms
of schedule and budget, for this undertaking are optimistic.
The Crew Return Vehicle (CRV) is a new, crewed, vehicle development
program which is required in early 2003 to support the autonomous,
safe return of up to seven crew members. The CRV development and
deployment is on the ISS Assembly Complete critical path. The
X-38 is a NASA in-house program to develop some technology for
the CRV vehicle. The X-38 Program is 10 months behind schedule.
Currently, there is no integrated plan or acquisition strategy
that would provide a seamless transition from the current X-38
Program to support CRV development and production requirements
and schedule. Further, NASA's CRV budget and schedule allow only
$5 million of expenditures in FY 1999, a production award in FY
2000, and only three and one-half years to operational need. In
the CAV Task Force's opinion, current CRV Program plans will not
support operational readiness requirements to meet the assembly
sequence need date.
Multi-Element Integrated Testing (MEIT) is a rigorous integration
and testing program intended to successfully demonstrate systems
interface compatibility and end-to-end hardware and software functionality.
Major flight hardware is scheduled to undergo MEIT just prior
to launch; however, hardware and software production activities
have very little remaining schedule reserve between now and launch
to address unanticipated problems. Resolution of problems or issues
identified during MEIT will likely result in launch delays. The
highly integrated and interdependent nature of the MEIT hardware
and software need dates and the phasing of MEIT activity also
introduce a high potential for multiple ISS launch schedule impacts.
Additionally, the schedule impact of incorporating MEIT for the
Phase III portion of the assembly sequence is not yet reflected
in the Program plan or budget.
The Laboratory is currently several months behind schedule, with
a significant amount of qualification and integrated testing remaining
to be performed. Software development and testing are also major
concerns. Considering past trends there is a high probability
of additional schedule erosion of several weeks or more.
Schedule slippage is affecting training readiness. In addition
to oral and written language complexities, there are also issues
with respect to detailed approaches to training that are cultural
or philosophical in nature and are yet to be fully resolved.
Software testing and integration are traditionally the areas of
space system development subject to the greatest schedule problems.
The ISS has a significant amount of software that has to be integrated
across multiple domestic and international suppliers. While many
software deliveries already have little schedule margin remaining,
late flight hardware deliveries will place further pressure on
software schedules due to hardware problems likely to be discovered
during late stages of testing. Typically, late hardware problems
are circumvented by software workarounds, thus increasing the
time and effort required for software integration and testing.
To contain near-term spending to within
the funding profile during peak development, decisions were made
to reduce contracting for parts and spares necessary to support
the current schedule. Various program activities were hardware-limited
during the development and test phases. Not procuring adequate
spares during the initial production run of some components may
lead to quality and consistency issues as well as increased cost.
1.3. 2 International
Sixteen countries on four continents are engaged in building hardware
and software for the ISS. Each country has its own governmental
limitations. Partner countries have adjusted, and will continue
to adjust, their level of financial involvement and schedule commitments,
ultimately affecting U.S. costs and schedules. Further, modifications
to the assembly sequence, ground operations, and on-orbit operations
all require integration and various levels of coordination and
joint approval. The U.S. developmental effort cannot be isolated
from these occurrences and their associated impacts: the Program
has experienced cost growth and schedule slippage associated with
this broad level of international involvement.
This has been especially true in the case of Russia. The anticipated
one billion dollar cost savings to the U.S. to be accrued from
Russian provision of the Functional Cargo Block (FGB in its Russian
language acronym) and an Assured Crew Return Vehicle capability,
was a faulty assumption as far back as 1994. The continuing economic
situation in Russia has also negated most of the $1.5 billion
in schedule savings to be achieved through their involvement.
Russian schedule slippage, due largely to failure of the Russian
government to deliver promised funding, translates directly to
the most recent Service Module schedule slips. With continuing
funding shortfalls carrying into 1998, the absence of any hard
indicators that adequate Russian funding will be provided soon,
and the recent cabinet shake-up in Moscow, it is likely RSA elements
will experience further delays.
The CAV Task Force notes that a diminished level of Russian participation
could significantly alter the current ISS assembly sequence and
final design. Proceeding forward with full knowledge of the past,
present, and to some extent, the future economic environment in
Russia without implementing adequate contingency capabilities
to address likely shortfalls is tantamount to accepting a level
of risk that could drive U.S. costs significantly higher. NASA
contingency plans extending beyond the development of the Interim
Control Module are not reflected in the current budget. The Task
Force believes the level of exposure to increased cost from Russian
delays justifies the funding of additional contingency activities.
Major International Risk Elements
The most significant cost and schedule growth risks identified
relative to International Partner contributions are as follows:
Inadequate funding will likely cause the Service Module schedule
to slip a minimum of four months in addition to the eight months
already acknowledged and incorporated into the Revision C baseline
assembly sequence. Service Module subsystem deliveries are being
affected, and this could result in a day-for-day slip until adequate
funding is supplied. Approximately $45 million dollars in FY 1997
Russian funding are still outstanding, and there are no hard indicators
that adequate Russian funding will be provided any time soon for
FY 1998 and beyond.
Current RSA plans reflect a late 1999 Mir deorbit. This plan,
which calls for deorbit a year later than NASA had desired, foreshadows
a Russian logistics impact to the current ISS assembly sequence.
Russia's demonstrated Progress spacecraft production capacity
and its recent launch rate capability do not support the view
by RSA that it can meet its collective ISS and Mir requirements.
1.3.3 Operations
In the operations timeframe, the ISS Program management believes
it will be able to meet its $1.3 billion annual operations funding
limit. The Task Force believes this level of funding is inadequate
to support the total scope of the technical and operational requirements.
Major Operations Risk Element
The CAV Task Force anticipates that upgrades due to normal wear and tear, obsolescence, and degradation will be required, and additional funding will be necessary to support these needs. This issue is addressed in section 4.3, but it is not quantified. It is noted as an item of significance and one that merits additional in-depth consideration.
1.4 Conclusions
Given the above considerations, the Task Force concludes that
the Program has inadequate funding to cover normal developmental
program growth, ISS cost and schedule risks, and necessary risk
mitigation activities. The ISS will also likely experience a delay
of one to three years in the completion of assembly.
Relative to budget formulation, the Program will likely need
the full level of funding requested in the FY 1999 budget submission
to Congress. The Program should plan for the development schedule
to extend an additional two years with additional funding requirements
of between $130 million and $250 million annually, including the
period beyond Assembly Complete. The specific annual CAV Task
Force funding recommendations are provided in Table 3-3. This
level of funding and schedule extension results in a total assessed
cost of approximately $24.7 billion from the 1994 ISS redesign
through ISS Assembly Complete.
This level of funding should be sufficient to address threats
that are reasonably likely to occur, with several noted exceptions:
it does not cover catastrophic launch vehicle or payload failures,
the withdrawal of an International Partner, or the development
of a U.S. propulsion capability which the Task Force believes
should be factored into an overall Russian contingency strategy.
1.5 Recommendations
1) The present program plan should be revised
so that it is achievable within the financial resources available.
Realistic major milestone dates should be established as the basis
for development of the program plan and internally defined target
dates should be used for execution. If necessary, program content
should be eliminated or deferred to fit within funding constraints.
2) Develop and implement a comprehensive cost and schedule risk
evaluation and mitigation strategy associated with the delivery
of Russian contributions, particularly for the uncertainties associated
with propulsion and logistics capability and the Service Module
delivery.
3) Develop and implement Phase III MEIT to mitigate on-orbit systems
assembly and integration uncertainties.
4) Consider merging the NASA X-38 and the CRV development programs,
accelerating the start of the CRV to FY 1999, and increasing the
budget by $120 million. The CRV schedule urgency coupled with
relatively high levels of technical and budgetary uncertainty
support the need to have a seamless transition of experience and
learning from the NASA X-38 Program to the CRV Program.
5) Establish a specific organization and management structure with responsibility for Systems Engineering & Integration (SE&I) efforts, including sustaining engineering. The structure should include both government and contractor personnel from all participants and should be given clear management responsibility, authority and budget to carry out an integrated SE&I plan. NASA should also clearly delineate and document the systems integration responsibilities for which each party is accountable and currently performing.
6) Establish a competitive environment for support contracts,
such as sustaining engineering, in order to reduce overall program
costs.
7) Maintain the current level of research funding. Develop plans
to maximize science utilization on-orbit during schedule stretchout.
8) Institute a system for determination of earned value performance
measurement for the Non-Prime scope of effort. Non-Prime activities
account for 65 percent of the total staffing in 1998 and are growing
as a percentage of work performed. Implementing such a system
would greatly increase the accuracy of status reporting and of
Non-Prime cost and schedule projections.
9) Verify the appropriateness of a flat funding profile for the
operations timeframe of the ISS, specifically assessing how obsolescence-induced
upgrades will be planned and implemented.
2-1 FY 1998 vs. FY 1999: ISS Budget Projections
2-2 FY 1999 Congressional Budget Summit ISS Components
2-3 ISS Component Funding by Fiscal Years
The mission of the International Space Station (ISS) Program is
to build and operate a state-of-the-art orbital research facility
some two hundred nautical miles above Earth. The ISS Program stems
from a redesign of the Space Station Freedom Program in 1993 that
President Clinton had directed NASA to do to lower its cost.
Schedule and Cost Commitments
On March 10, 1993, NASA established a Station Redesign Team to consider viable space station options that would continue to accommodate the International Partners within specific funding constraints and first-level goals established by the Clinton Administration. The redesign team developed three basic options, all of which required funding in excess of target budget guidelines and, in particular, above the $2.1 billion annual cap that the Clinton Administration proposed, and NASA accepted, at the culmination of the redesign activity.
The President's Advisory Committee on the Redesign of the Space
Station judged two of NASA's options to be roughly comparable
and satisfactory for meeting the Administration's objectives,
excepting those of cost, which all options exceeded. That Committee,
chaired by Dr. Charles M. Vest, assessed NASA's cost projections
to be realistic, but recognized that the space station should
be considered as an ongoing, evolving program of scientific and
technological research.
The Advisory Committee further recommended that NASA and the Administration pursue increased levels of cooperation with Russia as a means of enhancing the capability of the Station, reducing costs, accelerating schedule, providing alternative access to the Station, and increasing research opportunities. It also recommended that the Space Station Program reorganize, reconfirming NASA's redesign team's recommendation to have one Prime contractor responsible for development and integration. These findings were published in June 1993.
The Station concept that NASA selected from this redesign activity
was called Space Station Alpha. It was a downsized representation
of Space Station Freedom with the capability for a crew of only
four, and it was totally reliant on the Shuttle for transportation
and supply. The original redesign options had projected Permanent
Human Capability (PHC) in 2001 or 2002. But these scenarios also
required peak annual funding levels of at least $2.8 billion.
In June 1993, the Administration provided guidance to keep the
Program within an annual expenditure level of $2.1 billion. NASA
reassessed the assembly plans given this constraint and revised
the schedule for achieving PHC, deferring it to September 2003.
The cost for Space Station Alpha was assessed at $19.4 billion.
In December 1993, Russia was invited to join the partnership.
It was thought that the Russian participation in the ISS Program
would accelerate the assembly timetable and avoid substantial
development costs in the areas of propulsion and navigation. It
was also estimated that Russian contributions would nearly double
the Station's on-orbit volume, allow an increase in crew size
to six, and provide an earlier crew presence. After Russia agreed
to participate, geographic constraints of launching elements from
the Baikonur Cosmodrome in Kazakhstan necessitated a change of
launch inclination from 28.5 degrees to one of 51.6 degrees. While
this change negatively impacted the Shuttle's cargo carrying capacity
for transport of elements and supplies to the Station by over
12,000 pounds per flight, the capability reduction was offset
by the addition of 13 planned Russian assembly flights. Russian
participation also allowed completion of ISS assembly to be accelerated
from September 2003 to June 2002, a projected cost savings of
$1.5 billion. The Russian provision of the Functional Cargo Block
and an Assured Crew Return Vehicle were estimated to save another
$1.0 billion. These savings were partially offset by new U.S.
costs identified to integrate Russia into the Program. In total,
a net estimated cost savings of $2 billion was projected from
Russian involvement. Beyond that, Russia's involvement advanced
foreign policy objectives such as demilitarization, privatization,
and integration of Russia into the international community.
NASA stated at the time that it could develop the Space Station
Alpha design within an annual fiscal constraint of $2.1 billion
per year, and with Russian participation it could complete assembly
of what had become known as the International Space Station for
a total of $17.4 billion. These self-imposed funding constraints
were established prior to the FY 1995 Congressional budget submission.
The Program was carrying approximately $2.0 billion in reserves
with approximately $500 million allocated primarily for unresolved
management challenges. NASA's schedule and cost commitments were
definitely success-oriented, especially considering the new realigned
contracting approach with a single Prime contractor and that the
specifics of Russia's involvement were just being definitized.
2.2.1 1994 Events
There were many early challenges to NASA's ability to maintain
its cost and schedule commitments. In the spring of 1994, Space
Station Freedom contracts had been novated, but NASA had not reached
agreement with Boeing on a definitized Prime contract, and Boeing
was far from reaching contractual agreement with the existing
major subcontractors. This did not occur until the spring of 1996.
NASA and RSA were still working on an Inter-Governmental Agreement
(IGA) to bring Russia into the Program. It was not until March
1994, when NASA was able to conduct a full systems design review,
that the redesign activity was considered complete. The initial
baseline ISS assembly sequence was not officially established
until November 28, 1994, reflecting FEL in November 1997, with
ISS Assembly Complete by June 2002.
By April 1994, Canada had shifted its priorities away from human space flight and space robotics toward space communications, earth observation and technology development. As a consequence, NASA agreed to assume more responsibility (and more cost) for the extravehicular robotics function than had been foreseen in NASA's original agreement with the Canada Space Agency (CSA). As a result, Canada's Space Station utilization rights during the operational phase of the Program were reduced accordingly. NASA estimates at the time reflect that this reduction in CSA's commitment increased NASA's overall development costs at completion by over $200 million.
In June 1994, the Centrifuge Accommodation Module (CAM), which
was part of the Space Station Freedom design but was not identified
specifically in the Space Station Alpha assembly sequence, was
brought back into ISS assembly plans; however, additional funding
for this element was not requested or provided.
It was agreed that Russia would build and launch the first on-orbit
element, the FGB, in the International Space Station assembly
sequence. To assure U.S. ownership and control of the FGB, NASA
decided to procure it through Boeing from the Russian manufacturer,
facilitating Russian privatization and simultaneously allowing
the first on-orbit element to be a U.S. element. This procurement
cost the Program slightly over $200 million in reserves. It was
also in this timeframe that a U.S.-developed CRV was added to
the Program, yet no additional funding was requested by NASA.
NASA carried the CRV as a threat against reserves until just recently,
when funding was allocated in the FY 1999 budget submission to
Congress specifically for the CRV.
The only notable U.S. developmental problem occurred late in 1994
when Boeing, the Prime contractor, incurred welding and tooling
problems in the development of the Node Structural Test Article
(STA). This resulted in an approximately four month impact to
horizontal drilling of the STA. Recovery plans were put in place
and the Program appeared to be largely on track to meet its commitments.
2.2.2 1995 Events
At the start of 1995, NASA had increased its reserve posture to
slightly over $3 billion, though there was still significant concern
about the adequacy of near-term reserves to carry forward into
1996. In increasing its reserve posture, NASA had reassessed its
operations and Non-Prime budget estimates, reducing its cost projections
by over $2 billion. However, a fourth Photovoltaic Power Module,
additional truss structure and other lesser additions to the Prime
contract had increased the amount of Prime contractor work by
approximately three quarters of a billion dollars. NASA also realized
that certain management challenges for cost reductions that it
had carried in other areas were not going to be realized. Beyond
that, new threats against the Program had increased significantly:
NASA was now carrying the CRV, a Control Module for contingency
against Service Module delays, additional "make operable"
change threats, and other threats totaling $1.5 billion.
In mid-1995, Revision A to the baseline assembly sequence was adopted. There were no changes to the schedules for FEL or final assembly. The only significant changes concerned the addition of two new Russian flights for power augmentation.
The earlier Node STA slippage rippled through the boring and milling
schedules for the other U.S.-manufactured pressurized modules.
Boeing also began to show cost and schedule variances in other
areas as well. Beyond the under-performance situation, there continued
to be constant growth on the contract from program changes totaling
approximately $340 million in 1995. This growth, coupled with
the Boeing performance problems and an increase in cost of the
Functional Cargo Block (above what NASA originally projected)
depleted NASA's near-term development reserves. In the fall of
1995 NASA re-phased approximately $350 million in ISS utilization
funding to replenish near-term reserves constrained by the annual
expenditure cap.
As the development activity moved firmly into the manufacturing
stage, NASA was beginning to review specific plans for implementation
of ISS integration and test requirements. This review led to increased
testing and verification procedures that NASA had to assess how
to implement within already strained resources.
RSA presented a proposal to NASA in December 1995, for extension
of the on-orbit life of its Mir space station in order to use
it as a building platform for ISS. It also informed NASA of a
decision to not use the Russian Zenit launch vehicle for assembly
of the ISS. NASA agreed to assist RSA by providing additional
Shuttle logistics flights and continuing the Shuttle-Mir program
into 1998, but did not agree to use Mir as an on-orbit platform
for construction of the ISS.
Not using the Zenit would necessitate up to four Progress launches
for the Russian Science Power Platform (SPP) assembly and thus
would cause considerable delay in its operational readiness. NASA
agreed to launch the Russian SPP on the Shuttle to mitigate assembly
impacts. While Russian Research Modules were affected to the greatest
extent, Node 2, the CAM, U.S. Utilization flights, and the Japanese
and European Research Modules were all delayed, with the CAM and
European Columbus Orbital Facility (COF) being delayed beyond
Assembly Complete. These changes were eventually reflected in
Revision B of the baseline assembly sequence, which was not officially
agreed to until the fall of 1996.
2.2.3 1996 Events
At the beginning of 1996, total ISS reserves were still being
held at close to $3 billion. With the re-phasing of near-term
funds from the utilization account to the development account,
NASA believed it could maintain 1996 development schedules; however,
near-term reserves turned out to be inadequate to address the
many challenges that were to occur.
In the spring and summer of 1996, the Node STA and the Node 1
were both undergoing pressure testing. During these structural
tests, stress exceedances were identified in the radial portals.
NASA established a "blue ribbon team" of senior structural
and aerospace program managers and engineers to identify actions
necessary to resolve the problems. Additional strengthening struts
were eventually added to the Node structure, and the problematic
gussets were modified to more evenly distribute stress across
the Node hatch. These "make operable" changes resulted
in additional Node delays and contributed greatly to the Prime's
cost and schedule growth in 1996.
In addition to the structural Node problems, a number of other
development problems were experienced in design, test, and manufacturing.
By the end of 1996, the Prime's cost overrun was nearly $200 million
and growing at a rate of $16 million a month. Also, other program
changes for "make operable" work continued to be required,
with approximately $200 million of funding being used from reserves.
Despite the difficulties, a total of 155,000 pounds of U.S. flight
hardware had been completed by the end of 1996.
Good developmental progress was being made by the International
Partners, with the continued exception of Russia. Throughout the
year, there continued to be concerns about the lack of progress
on the Service Module. While Russia continued to maintain that
it could meet its April 1998, launch commitment for the Service
Module, schedule milestones continued to be missed and deferred.
NASA and the U.S. Government applied management emphasis at all
levels in an attempt to obtain release of adequate Russian government
funding for RSA to maintain its schedule commitments. Finally,
in the fall of 1996, Russia explicitly informed NASA that it would
not be able to meet its Service Module delivery milestone.
Throughout the year NASA had been assessing various contingency
options should Russia not be able to meet its Service Module commitment.
In December of 1996, NASA initiated development activities at
the Naval Research Laboratory (NRL) for the development of an
Interim Control Module (ICM). The ICM would provide adequate propellant
and attitude control to continue to build the assembly sequence
should the Russian Service Module be further delayed. The ICM
would also be available to provide some assurance against Russian
logistics shortfalls.
2.2.4 1997 Events
NASA entered 1997 with approximately $2.3 billion in reserves
on the books through June 2002. Threats against those reserves,
however, had grown to $1.9 billion. As in the two prior years,
Prime contract cost growth continued. Additional Program changes
were needed to make equipment operable, and continuous cost increases
were being driven by Russian funding inadequacies and element
delivery delays. In addition, requirements for maintaining an
adequate workforce for sustaining engineering and for procuring
the necessary on-orbit spares for maintenance and contingencies
were being delineated. Definitization of these activities caused
additional cost growth.
Russia finally committed funding to continue work for completion of the Service Module and for other ISS commitments in the spring of 1997. NASA and RSA worked together to minimize schedule perturbations and to find efficiencies and workarounds. In the final analysis, an eight month slip was agreed to and baselined into the ISS Program.
Russian plans to launch several Logistics Transfer Vehicles (which
were similar to the FGB in design and were intended to minimize
the number of launches required for ISS re-boost) were deleted
and replaced with Russian Progress vehicles with less fuel capacity.
This change introduced additional uncertainties relative to Russian
production capacity to meet the higher flight rate required for
launches. Significant changes were made to the assembly sequence,
resulting in increased training requirements. At the same time,
the Russian hardware delivery delays were causing additional challenges
to achieving the planned training proficiencies utilizing actual
flight hardware and software.
In April 1997, NASA informed the Congress of its plan to reallocate
$200 million in new FY 1997 funds from the Human Space Flight
Program to a new budget line item for "Russian Program Assurance"
(RPA). This line item was established to fund contingency activities
addressing Russian uncertainties. This line item, which Congress
approved, allowed the ICM to be funded and other necessary changes
to be made in order to integrate the ICM into the ISS without
further depleting NASA's limited near-term reserves. NASA originally
suggested that this line item be the source of funds to develop
further contingency alternatives to buy down the cost and schedule
risks that could result from other Russian shortfalls, but no
additional money has been made available for that purpose.
In May 1997, all of the International Partners met and agreed
upon a new near-term assembly sequence that accommodated Russia's
schedule slippage. They decided to withhold a final decision on
whether to maintain the schedule showing the Russian Service Module
schedule at its projected launch date of November 1998 or to insert
the NASA-funded ICM into the assembly sequence. The latter option
would then provide Russia additional time to complete the Service
Module. No new date was provided relative to Assembly Complete,
but NASA indicated that it would slip beyond 2002.
The new assembly sequence reflected a number of significant changes.
The first element launch, beginning ISS assembly, was deferred
from November 1997 to June 1998. A number of new flights were
also incorporated into the assembly sequence. Two new logistics
flights protected the option to integrate the ICM into the assembly
sequence either in place of the Service Module or at a later date
for a propellant-related contingency. There was also a significant
amount of replanning relative to logistics. The eight month slip
in the assembly sequence resulted in a utilization gap in the
research community's access to space, so, separate from the ISS
assembly sequence, two new Shuttle utilization flights were added
to the Shuttle manifest to maintain adequate research access.
Approximately $25 million in ISS Program funding was applied toward
providing pressurized research laboratory infrastructure for these
Shuttle flights.
In September, after the International Partners were able to confirm
that significant Russian funding was, in fact, being applied to
the Program and that Russian subcontractors had confirmed that
the money provided would allow the Service Module to hold its
new schedule, Revision C to the baseline assembly sequence was
approved.
Revision C maintained the option to insert the ICM in 1999 should
Russia incur a shortfall in its ability to provide an adequate
number of Progress launch vehicles for ISS propellant resupply
and reboost. Revision C also reflected the addition of: a third
Node; the rescheduling of the European COF back within the timeframe
for Assembly Complete; and, integration of two new logistics vehicles
into the manifest, the European Automated Transfer Vehicle (ATV)
and the Japanese H-II Transfer Vehicle (HTV). The final launch
provided in the assembly sequence was shown in December 2003.
Specifics of NASA's offset agreements is documented in Section
2.4.
The third Node being provided as an offset by ESA is a significant
development. The volume of the Node is roughly equivalent to the
Multi-Purpose Logistics Module (MPLM) and, as such, offers the
ability to add much of the crew habitability subsystems that were
to be launched on the Habitation Module. This allows six-person
PHC to be achieved with the on-orbit delivery of the CRV.
The Russian-driven schedule delays offered NASA the opportunity
to significantly increase the level of ground integration and
verification tests planned, thus reducing the threat of having
a costly functional integration problem occur on orbit. When the
launch dates for U.S. hardware were slipped, NASA held Boeing
to most of its contractual delivery dates. This provided some
schedule margin between element delivery and launch into which
NASA programmed MEIT. These end-to-end tests are meant to validate
that the early inter-elemental systems will work as designed.
Early in 1997, NASA took necessary steps to focus Boeing corporate
management attention on the ISS Program through the award and
incentive fee process. Since then, Boeing has brought additional
financial and managerial resources to the team. Boeing has developed
a new baseline cost estimate that reflects a total increase of
approximately $600 million over the life of the contract, with
over $400 million of that increase already incurred. The Performance
Measurement System used to track cost and schedule variances has
been adjusted to reflect this new cost estimate at completion.
The Program has attempted to limit changes only to those deemed
as "make operable" and those necessary to strengthen
the Program's test and verification processes. These types of
changes alone required usage of $600 million in Program reserves
in 1997, shrinking total reserves through 2002 to approximately
$600 million.
Entering 1998, the Program continues to be hampered by some of
the same problems that it faced in preceding years. While reasonable
progress continues on the U.S. elements, there are many challenges
ahead that will result in increased cost and schedule erosion.
U.S. development problems continue to be overshadowed by Russian
funding shortfalls and delays in their commitments; however, even
the current Revision C schedule is not fully supportable due to
U.S. production delays and the incorporation of much needed multi-element
integrated testing. There is relatively little uncertainty associated
with the launch dates of the first two U.S. element flights. The
U.S. laboratory, however, is several months behind schedule and
is unlikely to recover, although workaround plans are in place
to hold its scheduled May 1999 launch. There continue to be recurring
problems such as late part and component deliveries on downstream
flight elements, similar to those that plagued earlier flight
elements. While the Prime contractor headcount is being reduced
from the development program, there has been considerable growth
in civil service and Non-Prime support.
While disconnects between the level of funding and work planned
on the Program appeared in previous years, the Program was always
able to reflect an ISS funding level within the $2.1 billion cap.
The FY 1999 budget to Congress, submitted in February, marked
the first significant departure from the $2.1 billion commitment,
with NASA requesting an additional $430 million for FY 1998. The
FY 1999 submission also reflected $1.5 billion of additional funding
in the Program through 2003. This included $626 million for the
development of a CRV. With the level of funding requested in the
FY 1999 submit, NASA believes it can absorb the current Service
Module delay, without asking for additional funds.
Again, in 1998, it appears that the U.S. developmental schedule
erosion will be overshadowed by significant Russian funding and
schedule problems. As of the writing of this report, $45 million
of Russian FY 1997 funding earmarked for the Service Module is
still being delayed. Relative to FY 1998 funding, reports are
that only a small monthly allocation based on the Russian Government's
continuing resolution is being provided, and it has not filtered
down to the contractors performing work. This situation has resulted
in a minimum four month delay in launch of the Service Module,
with day-to-day slippage until adequate and sustained funding
is achieved.
At the General Designers Review (GDR) in January, it was clearly
evident that a lack of adequate funding was going to further impact
the assessed four month delay in the Service Module launch. With
the recent events relative to the shake-up of the cabinet in Russia
and the continued absence of any real evidence that funding is
imminent, the CAV Task Force believes it is highly certain that
further schedule slippage will occur. The Service Module is near
the point where it could be completed and launched at a minimal
cost. Unfortunately, continued developmental progress appears
linked with the availability of government funds which continue
to be problematic At this point, the lack of sustained funding
also gives rise to a greater concern, that of Russian logistics
support.
2.4 International Partner and Bilateral Agreements
Under the Space Station IGA and Memoranda of Understanding (MOU), each participating agency is incentivized to spend its tax dollars at home. The ideal outcome is to have no transfer of funds among the nations. With the international partnership, every country is responsible for a pro rata share of the operations cost necessary to sustain the basic infrastructure and capabilities.
To achieve a full common operations cost offset, ESA made using
an ESA-developed ATV to carry logistics to the ISS a condition
of its continued support. This agreement led to the October 1995
confirmation of ESA's commitment to a three-component ISS contribution:
the COF, the COF utilization plan, and the ATV that will be launched
by Ariane 5 and provide pressurized or unpressurized logistics
services and re-boost for the ISS. Similarly, Japan is developing
the HTV with the goal of not owing NASA for payload launch services,
and thus, offsetting its common operations costs.
As the U.S. agreed to launch the European COF module and the Japanese
pressurized and unpressurized modules, each country desired to
determine what type of ISS contributions it could make to offset
the Shuttle launch cost.
In exchange for Shuttle launch services for the COF, NASA and
ESA have reached an agreement in principle on the provision of
Nodes 2 and 3 and utilization facilities. The U.S. development
plans called for the Node STA, after testing, to be outfitted
and flown as Node 2. This obviated any opportunity to do additional
destructive testing on the STA that appeared to be needed to resolve
flight certification concerns. The manufacturing process that
was used by Alenia to build the MPLM for the U.S. results in a
more durable structure, while also providing a considerable amount
of additional on-orbit storage capacity. The Node 3 is large enough
to accommodate most of the crew support equipment planned for
the U.S. Habitation Module. Integration of this equipment into
Node 3 allows the U.S. to defer some Habitation Module development
activity to a timeframe when there will be less strain on its
financial reserves. Having to provide support subsystems for the
new Node 3 as well as the Habitation Module will result in an
additional cost to the Program of approximately $125 million dollars.
In exchange for Shuttle launch services for the Japanese pressurized
and unpressurized experiment modules, Japan will build the CAM,
the Centrifuge Rotor, and a Life Sciences Glovebox; launch a NASA
payload on a dedicated H-IIA flight; and build eight payload interface
units. Having Japan build the Centrifuge equipment provides a
mechanism to fund equipment that would otherwise impact other
utilization capabilities or be delayed.
NASA also entered into an implementing arrangement with Brazil
to provide some utilization facilities and logistics carrier support.
In return, Brazil would receive access to certain NASA on-orbit
utilization resources, totaling less than 0.5 percent of NASA's
allocation, and the launch of 300 pounds of Brazilian payloads
to orbit.
2.5 Overview of Current Baseline
The baseline for the Task Force's ISS Program assessment is the
FY 1999 budget submission to Congress (Appendix F) and the Revision
C International Space Station Assembly Sequence (Appendix G) and
schedule dated 9/30/97. The FY 1999 budget submission to Congress
recognizes several problem areas experienced by the Program during
FY 1997 and early FY 1998 and provides increased levels of new
obligation authority compared to the FY 1998 Budget. Additionally,
there is funding identified for the development of a CRV commencing
in FY 2000 (only $5 million in FY 1999).
The Revision C Assembly Sequence commences with launch of the
Functional Cargo Block (FGB), scheduled for June 1998. ISS Phase
II is scheduled to be completed after Flight 7A in August of 1999;
ISS Phase III is scheduled to be completed after Flight 16A in
December 2003. Approximately 93 flights, including assembly, crew
transport, logistics, and resupply are envisioned through the
completion of Phase III.
At the time of this report, the Program Office is establishing
and reprogramming an assembly sequence revision that will reflect
the completion of Development with the launch of Node 3 on Flight
17A. The ISS will support six crew members at that time, given
the implementation of full crew return capability through procurement
of a second Soyuz spacecraft or acceleration of the CRV.
Figure 2-1: FY 1998 vs. FY 1999: ISS Budget Projections
Figure 2-2: FY 1999 Congressional Budget Summit ISS Components
Figure 2-3: ISS Component Funding by Fiscal Years
Related Figures
3-1 Percentage Overruns
3-2 Contractor Staffing Projections
3-3 FY 1998 ISS Civil Service
3-4 Schedule Milestone Trends
3-5 CAV Schedule Assessment
3-6 Impact of Schedule Stretchout
3-7 Assessment of Reserves
3-8 CAV Budget Recommendation
3-9 CAV Funding Assessment
3-1 Estimates of Schedule Slippage Associated with Major Risk Elements
3-2 Estimates of Cost Growth Associated with Major Risk Elements
3-3 CAV Funding Recommendations
The baseline program cost and schedule were assessed in context
of the risks described in Sections 3.1 and 3.2. The programmatic
issues and the major risks were identified based on the Task Force's
exposure to the ISS program over a four month period and represent
the collective experience and judgment of the Task Force. Risks
considered to be "catastrophic" were specifically excluded,
e.g., withdrawal of an International Partner contribution or protracted
downtime due to a failure of any of the principal launch vehicles.
Both the programmatic issues and the major risk elements described
below represent those areas we feel are likely to adversely affect
the baseline cost and schedule. The magnitude of these impacts
is largely a matter of judgment. The Task Force, however, is unanimous
in its opinion that program management has, to date, been optimistic,
particularly in planning adequate schedule margin for critical
events. The Task Force's quantitative analysis in Section 3.3
and the trend assessments in Section 3.4 take a more pragmatic
view of current program status and the interdependency of upcoming
critical events.
The results of the two separate approaches in Sections 3.3 and
3.4 are consistent and together form the basis for the CAV Task
Force overall assessment.
The FY 1999 NASA budget submission to Congress acknowledges that
the ISS development program will incur cost growth over the original
baseline commitment of $17.4 billion. The baseline program reflects
NASA's commitment to the completion of Phase III (Flight 16A)
of the ISS assembly sequence in December 2003. The Task Force
finds that there is a high probability that the baseline program
will incur additional cost growth and has attempted to quantify
those cost growth issues considered to have the highest probability
of occurrence.
It is noted that the potential for cost growth associated with
the current phase of the Program is likely to be driven by slippage
in the schedule. A significant part of the remaining effort is
directed at sequential activities such as component qualification,
integration and test. These processes are time-dependent. For
example, a cost impact will be realized when a failure occurs
during a qualification process. The failure requires rework and
then a repeat of the qualification process. The sequential nature
of the Program results in subsequent efforts being delayed and
accomplished farther out in time. Thus, while total Program cost
will increase, annual funding requirements are likely to be only
marginally impacted as depicted in the funding profile of the
current Program assessment.
The following details identify cost and schedule risks and provide
the basis of quantifying the anticipated contribution to cost
growth of the baseline program.
3.1.1 Russian Funding Commitment
There are significant benefits to be realized from Russia's contributions
to the ISS Program as they provide critical propulsion, resupply,
crew exchange, and crew return systems and capabilities. Because
Russia is undergoing a fundamental transition in its economic,
political, and social structures, however, its participation continues
to create risks that can affect delivery of components necessary
to meet schedule and cost commitments.
The new Russian constitution was not adopted until 1993, and the
budgetary process is still in a period of transition. The government
is attempting to establish monetary controls to cut non-budgeted
expenditures and to make critical analyses of resource requirements
of all government areas, including RSA. Although there is a funding
commitment for the ISS at the highest government level, the funding
process is erratic, and it is difficult to assess when the funds
will actually be supplied, not to mention the adequacy of those
funds.
For example, 1.8 trillion rubles ($300 million) were allocated
to the Program in FY 1997. Of this amount, 1.5 trillion rubles
($250 million) were special funding through the Ministry of Economic
Development. Much of this money, funded through promissory notes,
was made available to maintain the Service Module launch date.
The process for obtaining funds through floating promissory notes
was eliminated by decree in August 1997, immediately prior to
RSA's receiving its total allotment. This left approximately 480
billion rubles ($80 million) unpaid. Just this past January, President
Yeltsin directed the government to provide the remainder of these
FY 1997 funds to RSA by February 15, 1998. As of March 31, 1998,
however, RSA had not received the total balance of FY 1997 ISS
funds, and $45 million still remain outstanding. According to
RSA, another $22.5 million is to be disbursed in April and $22
million in May to complete the payment of the FY 1997 funding.
As was the case in FY 1997, most of the Russian funds for ISS
in FY 1998 will come in the form of supplemental funding. RSA's
budget provides approximately $100 million in funding for ISS.
As of the writing of this report, the Russian Federal budget had
received approval of the lower house of the Federal Assembly,
but had not yet been acted upon by the upper house. It is the
Task Force's understanding that RSA is receiving one-twelfth of
FY 1997's national budget as part of a continuing resolution.
This is allowing RSA to make some critical payments to suppliers.
The Ministry of Finance and Ministry of Economics are to devise
a plan for supplemental funding on the order of $200 million by
the end of April. Past experience would suggest that it will come
later in the year.
The Task Force does not possess the in-depth Russian economic
forecasting expertise necessary to accurately predict the outcome
of current monetary and economic policies of RSA's long-term funding
profile. Meetings in Moscow with U.S. Embassy staff experts on
the Russian economy suggest that financial challenges will continue
for some time. At this point, if all necessary financial resources
were supplied today, the Task Force believes RSA would still not
be able to meet the Revision C launch schedule for the Service
Module.
3.1.2 Prime Contractor Performance
The Task Force estimates that the Prime contractor will overrun
the current baseline development contract by at least $400 million.
This would bring the total overrun since definitization on the
Prime contract to one billion dollars.
Beginning in mid-1995, the contractor experienced cost overruns
to the target plan. These overruns began to increase significantly
during the fourth quarter of FY 1996. At that time, the overrun
stood at 4.4 percent of budgeted work performed to date. For the
contract reporting period ending in the spring of 1997, NASA provided
zero award fee. As a result, the Prime made
some personnel changes to strengthen its management team, intensified
its efforts to obtain and keep technical staff, and committed
over $30 million of Boeing capital to build a systems/software
integration facility.
As of October 3, 1997, the Prime contractor had exceeded the contract
budget baseline by $398.2 million (8.9 percent of budget.) The
contractor was also behind schedule by $139.1 million of scheduled
effort. Because of the significant difference between planned
schedules and cost and that of actual deliveries, NASA and Boeing
agreed to rebaseline the contract deliverables to reflect a cost
approximately $600 million above that of the initial contract,
with over $400 million of that increase already incurred. The
Performance Measurement System used to track cost and schedule
variances has been adjusted to reflect this new estimate of cost
at completion.
Still, cost and schedule variances continued to grow during FY
1997. The realized overrun was 19.6 percent of work performed
during the period and trending upward. The quarterly increase
during FY 1997 is noted in Figure 3-1.
Figure 3-1: Percentage Overruns
During the first quarter of FY 1998, the contractor, per its agreement
with NASA, implemented a $600 million "over target baseline"
adjustment to the total contract baseline. In developing its own
budget, NASA internally assumed that the overrun would reach $817
million, or $217 million over the contractor estimate. NASA subsequently
increased its internal overrun estimate to $849 million. The Task
Force was also advised of a $50 million overrun absorbed by a
major subcontractor.
Analysis of the effort remaining on the contract indicates a high
probability that cost overrun as a percentage of work content
will occur at increasing levels through completion of the contract.
Since the contract was rebaselined, another $23 million in schedule
variance has already occurred. The de-staffing plan is based on
delivery schedules that have little reserve margins, and the CAV
Task Force believes the Program has not adequately accounted for
the significant level of qualification, integration, and verification
testing activities which will be incurred. Historically, a high
probability of rework or redesign is required as a result of problems
routinely uncovered during testing. Significant amounts of flight
hardware components have been produced but have not yet completed
qualification testing.
Beyond that, the Task Force feels that Program de-staffing plans
have overestimated the rate at which work will be completed and
staffing will be released from the program. Figure 3-2
shows actual trends versus past staffing projections.
Figure 3-2: Contractor Staffing Projections
Total program schedule slip also creates a potential skills base
risk. As flight hardware and software is completed, the associated
skills base must be redirected elsewhere within or released from
the Program. This could be occurring prior to qualification or
system integration. The criticality of the issue will become manifest
when testing identifies the need for rework or redesign. This
situation is notably apparent at the lower-tier subcontractors.
This risk is common to space programs, due to the unique nature
of space-related hardware and software. The ISS Program Office
has advised the Task Force of its intent to address skills base
retention through the sustaining engineering workforce. Given
the funding constraints, however, this workforce may not be adequate
to completely resolve the issue.
3.1.3 Non-Prime Performance (NASA)
NASA and other Non-Prime contractors are directly involved in
a significant portion of the development, manufacture, integration,
and testing of ISS system hardware and software, the development
and implementation of operations capabilities, and in the development
of research projects. Non-Prime or NASA in-house expenditure is
nearly equivalent to that of the Prime contractor and will exceed
it in the outyears. In FY 1998, Non-Prime effort accounts for
$1.2 billion or 47 percent of the ISS budget. Within two years,
it will consume the majority of the ISS budget.
This effort also includes a significant component of civil service
labor, which is outside of the program budget. The Program Office
is limited to 400 civil servants, which
are considered full-time staff and are charged directly to the
Program. The FY 1999 budget submission to Congress reflected a
total requirement for 2,157 civil servants for FY 1998, many of
which are funded and matrixed to the Program from the various
NASA centers (Figure 3-3). The
total Non-Prime workforce (NASA and NASA contractors) is over
7200 Full-Time Equivalents (FTE) in 1998. This is almost double
the number of FTEs employed under the Prime contract.
Figure 3-3: FY 1998 ISS Civil Service
NASA is unique among Government agencies with respect to the degree
of direct involvement in its programs. It not only manages commercial
contractors, which is the typical Government role, but it also
performs as a contractor. This is considered beneficial in that
it has allowed NASA to develop a skilled pool of labor for functions
that are of limited demand and have very focused requirements.
It has certainly proved beneficial to the ISS Program in that
it has given NASA a significant degree of flexibility to absorb
Prime contractor effort in an attempt to reduce Program expenditures.
The Task Force notes that NASA does not have
an earned-value Performance Management System (PMS) in place for
much of the NASA and Non-Prime contractor effort. Because of the
lack of a performance tracking system, the Task Force encountered
considerable difficulty in evaluating NASA's cost and schedule
performance to date and in forecasting its future. NASA and other
Government agencies require prime contractors to maintain such
a system to track performance. Given the scope and content of
the NASA effort noted above, it would be prudent to institute
a system of performance measurement for its own effort.
A Non-Prime PMS could have been useful in identifying the impact
of Prime contractor effort absorbed by NASA. As noted above, NASA
has absorbed considerable Prime effort in its attempt to mitigate
the cost overrun. As also noted, the Task Force considers this
flexibility, in the near-term, to be beneficial to the Program.
The Task Force is concerned, however, that it could not identify
the impact on the NASA budgeted effort, present or future. While
the Non-Prime effort has underrun relative to cost in previous
years, the Task Force could not determine if the NASA effort had
been eliminated, naturally displaced, or deferred into the future
due to schedule slips. The Task Force believes that work has been
deferred and that this effort will be added scope to the effort
that has been budgeted in the outyears. These efforts have the
potential for significant cost impact to the Program which must
be accommodated through an increase to the annual funding profile
or additional schedule erosion.
The Task Force recommends that the Program institute a system
of performance measurement, that would be applicable to Non-Prime
(NASA and contractor) efforts including X-38 and CRV.
3.1.4 Contract Changes
The ISS Prime development contract has experienced considerable
change activity. At the end of FY 1997, $1.4 billion in changes
had been authorized. Of this amount, $730 million was authorized,
but not negotiated with the contractor. The total amount of the
change activity represents a 27 percent increase to the baseline
budget estimate and is 31 percent of the budgeted effort completed
to date.
The Task Force concludes that the complex nature of this program
and the influence of International Partners will continue to contribute
to change activity through completion of the contract. The Task
Force estimates that the ISS Program will experience a $425 million
increase to the development contract due to change activity. It
does not assume an experience rate at the current level, but recognizes
a significantly higher rate (20 percent) than the norm due to
the atypical nature of the Program.
3.1.5 System Integration and Sustaining Engineering
The Prime contractor currently has contractual responsibility
for ISS integration. NASA's intent has been to establish working
groups or teams of contractor and NASA personnel to perform the
integration functions. With the beginning of hardware shipment
to the Kennedy Space Center (KSC), NASA assumed responsibility
for management and technical portions of the system integration
effort by default in areas where the Prime contractor was not
technically prepared (in NASA's view) to accomplish the scope
of the integration effort. While the contractor's technical capability
has improved, NASA is still performing some of the systems integration
technical and management functions.
There are also areas where NASA must act as the systems integrator
because the contractor cannot represent the U.S. Government in
dealings with the International Partners. In these cases, NASA
and the Prime contractor have implemented a matrixed approach,
with NASA performing top-level functions and the Prime contractor
performing much of the necessary lower-level integration functions.
Similarly, NASA has assumed the responsibility for the overall
sustaining engineering integration of the ISS. Each of the International
Partners and participants is responsible for sustaining its specific
on-orbit and ground segments.
During the multi-year program transition from hardware and software
design and development to systems integration and test, launch,
on-orbit assembly and operations, the systems engineering and
other development engineering functions should also transition
over the same period of time to a support or "sustaining"
role on the Program. The Task Force believes that the Program's
approach to sustaining engineering has several shortcomings.
First, the budgeted level of effort for sustaining engineering
that NASA has programmed is likely to be inadequate. The Prime
contractor estimated this effort to be on the order of $1.4 billion
while NASA had originally budgeted $387 million. With the FY 1999
budget submission to Congress, NASA budgeted $952 million for
Prime contract and $150 million for Non-Prime contract sustaining
engineering. NASA and the Prime contractor have agreed on the
content and tasks that need to be performed over the life of the
ISS but not the scope of the tasks. A proposal for FY 1998 and
FY 1999 only has been provided at this point for a budgeted value
of $143 million. The Task Force believes that the sustaining engineering
effort has been underscoped in the current budget submission and
should be reassessed for Prime and Non-Prime contractors, NASA,
International Partners, and other participants.
Secondly, the Task Force believes that the Program's approach
to sustaining engineering could be improved by a focused management
approach to encompass the broader, technical support activities
of SE&I of which sustaining engineering is a natural element.
The current NASA approach provides a level of engineering support
to Operations after the development of all hardware and software
items are completed and accepted by NASA. "Completion of
development" is not a specific time on the Program's schedule
but rather is spread over a number of years for the various component
assemblies of ISS. The Task Force suggests that as the development
engineering function is incrementally completed, the "sustaining"
efforts required of the developers become an integral part of
a continuing SE&I function and organization. As critical skill
additions to such an SE&I organization, the sustaining engineering
personnel provide crucial life-cycle support as hardware and software
are assembled, integrated, tested, launched and operated on-orbit.
After ISS Assembly Complete, the entire SE&I function (including
the key sustaining engineers) should have a total Operations support
focus; namely, mission and vehicle performance analysis, logistics,
ISS health and status, hardware and software maintenance, and
problem resolution.
An excellent SE&I management model for ISS is the two, nearly
simultaneous NASA Viking Missions. NASA Langley Research Center,
the Jet Propulsion Laboratory, the Prime contractor, the integration
contractor, the element contractors, and the science teams were
integrated into a single organization and management structure.
The ISS implementation of a similar approach would naturally be
larger and more complex because of the multiple launch and on-orbit
events and the international participation. However, the larger
size and complexity of ISS is all the more reason that such a
structured approached should be considered.
The Task Force's overall assessment of the ISS systems integration
effort is that it lacks a management plan and clear leadership
approach. SE&I functions require focused analysis and implementation
in a tightly controlled project environment. The lack thereof
generally results in costly handoffs of responsibility, rework
and delays. Matrixed or split management and leadership responsibilities
are risky and ill-advised. NASA's view of its integration responsibility
for sustaining engineering, as stated earlier, is what NASA needs
to implement in the larger context of ISS SE&I. The Task Force
believes that NASA must provide the day-to-day management and
leadership of the more comprehensive and broader SE&I organization
that the Task Force has suggested in order to help control and
manage risks in the upcoming, critical integration phases of the
Program.
3.1.6 Contingency Planning and Risk Management
The ISS Program has a process which addresses identification,
assessment, mitigation, and monitoring of identified issues. It
has established a reserve to fund anomaly resolution activities
that are addressed through the risk management process.
The Task Force believes these reserve levels are inadequate for
maintaining a reasonable level of contingency protection.
The Task Force finds that budget and schedule constraints have
precluded ISS program managers from adequately planning for contingencies.
Budget availability rather than technical requirements has, in
certain circumstances, had a large influence on program planning.
As a result, contingency planning, cost and schedule risk management,
and risk mitigation have tended to be less proactive than they
should have been. Instances of this problem extend across the
program: the procurement of spares, the resolution of continuing
parts shortages, implementation of MEIT throughout the Program,
the lack of adequate contingency alternatives relative to Russian
shortfalls, and inadequate schedule and cost margins.
Program cost and schedule increases will occur; however, the negative
impact can be reduced if the Program has the reserves to develop
necessary cost and schedule risk mitigation plans and then commits
itself to implement these plans. This is an area in which NASA,
the Administration, and Congress must have a clear understanding
and an agreed-to course of action.
3.2. Major Cost and Schedule Risk Elements
3.2.1 Service Module
The Russians are continuing to make progress on the Service Module
despite funding shortfalls and technical difficulties associated
with the construction of this important element. The Service Module
is three to four months behind schedule in addition to the previously-announced
eight month schedule slip due to both funding and technical problems.
Officially, RSA still maintains that it can meet a December 1998,
launch date, but the Task Force's opinion is that a December date
will not be met, and an additional three to four month slip is
highly probable. Subsequent to the January, 1998 GDR, RSA signed
an agreement with 13 of 14 critical Service Module vendors promising
to provide outstanding funds by February 10, 1998. In return,
the firms agreed to ship to RSA outstanding subcomponents that
had been withheld pending payment. Since then there has been little
forward movement relative to financing. While most subsystems
have been delivered despite the lack of funding, there are subsystems
that continue to be withheld.
If the remaining 1997 supplemental funding, decreed by President
Yeltsin, is not received soon, the Task Force is virtually certain
that further schedule slippage will occur. There is a potential
that the flight article could be shipped directly from Khrunichev
State Research and Production Space Center (KHSC) to Baikonur
and undergo a lesser level of testing. This is contingent on the
ability of the qualification unit in the Complex Test Stand to
successfully complete its integrated tests. This alternative does
reduce some scheduled work, thus saving time,
but increases the risk due of problems
being uncovered on orbit. The next GDR is scheduled for April,
and the Task Force anticipates that a revised launch date will
be established at that time.
Modifications have already been made to the FGB so that if the
Service Module incurs a significant slip, NASA could launch the
ICM, dock it to the FGB, and continue assembling the ISS. At this
point in time, however, NASA is de-integrating hardware from the
NASA-funded ICM that would allow it to dock with the FGB. Necessary
hardware to dock the ICM to the Service Module will then be installed
on the ICM. This decision reflects NASA's confidence that any
further slips in the Service Module will be relatively insignificant
with respect to the total Program schedule. From this point forward,
the most likely ICM use would be as a contingency alternative
should the resupply capabilities of the Russian Progress logistics
flights fall short of projections.
3.2.2 Russian Logistics and Propellant Support
There are a number of concerns relative to Russia's ability to
maintain its logistics commitments. Since Russia was invited to
join the ISS Program in 1995, it has changed logistics carriers
three times and has removed one launch vehicle from consideration
for ISS assembly. RSA's inability to support Mir logistics flights
in 1997 and 1998 (necessitating use of the Shuttle) when it desired
to extend the Mir's on-orbit life is an example of Russia's programmatic
desires being more ambitious than its funding or launch vehicles
could achieve.
RSA's Mir deorbit plan is inconsistent with NASA's assessment
of Russia's launch capability to support ISS assembly. NASA has
urged RSA to begin deorbit operations for the Mir now; they will
take approximately a year to complete. Current RSA plans reflect
a late 1999 deorbit. The current projected Soyuz and Progress
flight rate of 14 per year exceeds their current avionics production
capacity of nine or 10 per year and their current launch rate
of approximately six per year. Regardless of Mir deorbit, there
are many concerns regarding Russia's ability to support its commitments:
staff, facilities, and commercial pressures. The threat to the
U.S. assembly is significant and demands immediate additional
contingency implementation.
Further, Russian long-term funding uncertainties and its financial
incentive to sell Station-reserved launch services on the commercial
market could impact logistics planning. There are also concerns
relative to the inability to retain skilled personnel at the Baikonur
launch site due to a low wage scale. Collectively, these factors
suggest that it is reasonable to expect perturbations in the logistics
schedule.
At any period in time, a one-year ISS on-orbit fuel reserve is
maintained. The only contingency development activity NASA has
funded is the ICM. It has a limited fuel capacity and could only
control and reboost the station for an active period of one year.
NASA believes it could develop a new long-term replacement propulsion
capability within a period of 24 months with adequate supplemental
funding. This Task Force strongly supports development of a U.S.
propulsion capability.
3.2.3 Hardware Qualification Testing
Component and subsystem qualification tests still lag significantly
behind their scheduled dates, but additional slippage on most
items has recently slowed. Nineteen major subsystem hardware items
successfully completed qualification testing in the last three
months, bringing the total qualification to 50 of 144 major items
required through Flight 9A. As of the writing of this report,
four qualification failures were open issues; namely, the Integrated
Motor Control Assembly, the Early Port Communication Transceiver,
the external DC to DC Converter Unit, and Vent Relief Valve.
Flight hardware component deliveries have also experienced significant
schedule slippage but this situation also seems to have stabilized
somewhat. Several major problems have been resolved recently in
the S-Band and Ku-Band communications hardware. ISS element-level
workarounds have become a way of life across all facets of the
Program due to hardware shortages caused by lack of sufficient
piece parts and other development problems.
3.2.4 Software Development and Integration
Because flight control and other types of applications software
cannot be fully tested until the hardware to which it applies
is delivered, software testing and integration is traditionally
the area of space system development that is subject to the greatest
schedule problems. The case of the ISS is no exception to this
general pattern since several major pieces of hardware are apparently
going to be delivered past their original scheduled dates. In
addition to validating that the flight software is correctly integrated
with its associated hardware, it is often the case that hardware
problems discovered during late-stage testing very likely will
have to be circumvented by software workarounds, thus increasing
the time and effort required for software integration and testing.
It is often more costly and inefficient to rework or rebuild a
piece of hardware to make it conform to the original specification
than to alter the software specification so that whatever hardware
exists can be made to do the job required. While software modifications
are often successful in recovering the desired operational capability,
it does take additional time and cost to incorporate the needed
fixes, and that time and cost is often labeled as a software schedule
slip and cost overrun.
As is noted by all participants in the Program, including the
Prime contractor and NASA Headquarters' Independent Annual Review
team, maintenance of the schedule for conducting the MEIT has
been and remains a major critical issue. The reason is that, for
MEIT to occur on schedule, all relevant hardware and software
must be completed and available. In addition, integration problems
and schedule slips resulting from test "failures" or
other less dramatic pieces of information uncovered during software
and hardware testing are normal even in simple single contractor
programs. The international nature of the ISS Program and the
consequent need to merge software written in several countries
to operate hardware built in several countries, intensifies the
"normal" difficulties.
Software costs and delivery schedules have historically been the
most optimistically underestimated portions of high technology
programs. The more complex the hardware and programmatic interfaces
are, however, the more difficult the software problems are, and
the more likely and lengthy are the schedule slips and resulting
cost overruns.
3.2.5 Crew Return Vehicle
The CRV, identified as a separate line item in NASA's FY 1999
budget submission to Congress, represents a new development critical
to achieving permanent human presence on the International Space
Station. The only alternative to the CRV is the Russian Soyuz
vehicle, permanent dependence on which would re-introduce and
make pervasive the significant production, operational and logistics
limitations that appear to be characteristic of Russian participation
in the ISS Program to date.
The ongoing X-38 Project at NASA's Johnson Space Center (JSC)
is considered a technology demonstration and proof of concept
for the CRV. Risk assessments and budgetary estimates for the
CRV have been extrapolated by NASA from several years of X-38
experience. The first free flight of the X-38 occurred in March
1998. Five X-38 vehicles are planned, divided into two separate
objectives as currently envisioned: a space test segment (two
vehicles) and a comprehensive atmospheric segment (three vehicles).
While the X-38 Project has nominally made satisfactory technical
progress, the program is ten months behind the original schedule.
There remain significant technical and schedule challenges for
both the X-38 and the CRV. The ISS Program also lacks a definitive,
integrated development, transition and acquisition plan for the
CRV. The major programmatic risks involve: the schedule mismatch
between the X-38 space test program and CRV production start;
and the fact that currently there is no plan for space flight
tests of a production CRV.
The lack of a transition and acquisition plan represents an unnecessary
critical issue that should be addressed immediately. The CAV Task
Force believes that the schedule overlap and critical dependencies
between the X-38 and the CRV programs require serious consideration
be given to combining these programs. The ISS program is considering
having significant international participation in the CRV production
program. The Task Force believes that this participation will
cost the U.S. by introducing additional integration and schedule
risk. Additionally, the Task Force recommends accelerating the
CRV program's start date to FY 1999 and increasing its funding
profile by approximately 15 percent ($120 million) through the
Initial Operational Capability (IOC).
3.2.6 U.S. Laboratory (Lab)
The U.S. Lab is currently behind schedule; a check of the Program's
overall schedule as of March 15, 1998 shows
the Lab to be approximately six weeks behind schedule.
Based upon current schedule trends, the Task Force believes that
a moderately conservative estimate of the Lab's current status
would indicate a three to four month negative margin at Lab completion.
The Program recognizes that the optimistic schedule in place for
the Lab will require many complex and innovative workarounds in
order to incrementally recover from anticipated late hardware
and software deliveries and other problems. The August 26, 1998,
scheduled delivery to the KSC to support MEIT objectives is in
jeopardy due to:
The U.S. Lab is an example of a major ISS element that manifests
many of the issues mentioned above in the Hardware Qualification
and Software Development and Integration sections. The Task Force
believes the Lab is a reflection of past issues and may be an
indicator of possible similar future occurrences.
3.2.7 Multi-Element Integrated Testing
MEIT was proposed in 1994 as part of the original Program baseline.
It was later eliminated from the negotiated contract to achieve
a funding profile that would satisfy NASA funding constraints.
In 1997, the Program acknowledged an eight month schedule delay
necessitated by a slip in completion of the Russian-built Service
Module. This provided an opportunity to reintroduce MEIT into
the Program baseline.
The Task Force strongly endorses the concept of MEIT, but considers
the schedule to be optimistic. Phase II of the Program marks the
beginning of ISS assembly in space. MEIT testing is intended to
successfully demonstrate element-to-element interface compatibility
and end-to-end functionality and operability of flight hardware
and software. Major flight hardware is scheduled to undergo MEIT
just prior to launch. In some cases, notably Flight 5A (U.S. Lab),
production schedules have zero margin for meeting the launch schedule.
Further erosion of margin in flight hardware deliveries would
exacerbate the launch schedule problem by extending the time required
for MEIT.
MEIT is also carried out in connection with the Node emulator
and Shuttle avionics, in particular, the Cargo Integration Test
Equipment (CITE). The scheduled span of time(s) from completion
of MEIT to launch of the elements is also optimistic, because
MEIT will be performed in complex ground systems test configuration(s)
which are very different configuration(s) from those required
for launch. A number of lengthy test disassembly and launch assembly
activities are planned during the period of 12/3/98 to 4/1/99.
Major element tests such as EMC Qualification, GN&C CSCI Acceptance
and high pressure O2 and element leak tests are scheduled
within this period. Launch processing improvements to the above
time spans should not be expected due to the large number of tasks
that have been transferred to the launch site in the interest
of schedule compression.
At this point in time, there has been no definitive planning for
incorporation of MEIT into the Phase III schedule. For all the
vital and valid reasons that the Program found it advisable to
incorporate MEIT into Phase II of the Program, it is as necessary,
if not more so, to incorporate MEIT into Phase III. Phase III
of the ISS Program involves a larger number of launches of many
more configurations of hardware and software from the International
Partners than does Phase II. In addition, the many internationally-provided
pieces of equipment from different development cultures will need
to be successfully time-phased into the launch schedule and physically
integrated into the existing on-orbit configuration. The potential
for a major negative program impact due to a mismatch between
the scheduled delivery date of a program element and its actual
delivery date increases dramatically during Phase III because
of the complexity and diversity of the various elements in existence
at that time. It is at this point that the lack of rigorous and
unambiguous system integration responsibility and authority, that
the Task Force expressed concern about earlier, becomes critical.
The hardware, software, ground test equipment, ground test software,
and procedures required to implement MEIT for ISS Phase III need
to be developed as soon as possible. A commitment to Phase III
MEIT at this time, not dependent on the essentially random availability
of the flight hardware involved, is a prudent step to avoid risk.
3.2.8 On-Orbit Assembly Complexity
Assembly of the ISS will involve 35 assembly flights over five
and a half years, with astronauts and cosmonauts performing three
times as much ExtraVehicular Activity (EVA) as all EVA combined
since the Apollo Program.
The experience gained from the Shuttle-Mir program should be an
indicator of the additional complexity and challenge of assembling
a million pounds of ISS hardware two hundred miles above Earth.
The coordination of 11 Russian assembly flights, 23 U.S. flights,
and four international assembly flights synergistically supported
by 48 logistics flights will be the most complex and technically
challenging achievement in human space flight since landing on
the moon.
EVA is planned to be limited to six hours per day for assembly
operations. The plan is that one-third of the EVAs will be performed
by ISS crews. There are two contingency EVAs for each Shuttle
flight (one for ISS and one for Shuttle). The program has additional
consumables to accommodate each of these additional EVAs. Each
Shuttle flight has three planned EVAs with the exception of one
Shuttle flight, which has four. Interviews at JSC stated that
the budget for EVA over and above that discussed above has little
reserve and minimal flexibility. Without even addressing the functionality
of thermal, power, control, communications and other considerations
for the spacecraft to be safely maintained, it is difficult for
the Task Force to accept that "most of the hard work is behind
us". Additionally, the complexity of different ground control
stations, multiple logistics carriers, elements built in different
countries, space walk requirements as noted above, the integration
and coordination across different cultures, add to and underscore
the Task Force's concern with the program's optimistic date relating
to Assembly Complete.
3.2.9 Parts and Spares Shortages
The ISS Program appears to have a solid approach to the identification
of sparing requirements and to maintenance on-orbit. In addition
to the use of theoretical Mean Time Between Failure (MTBF) rates,
technical directors have defined their sparing requirements for
worst-case scenarios, including the need for everything from jumper
cables to replacement of failed Orbital Replacement Units (ORU).
This process has defined much of the manifest for flights 2A and
2A.1 to accommodate spares. The identified sparing requirements
have been large. In fact, an external "porch" was built
on the outside of the Airlock to provide necessary storage space
for spares.
In regard to on-orbit sparing and obsolescence, the ISS Program
is attempting to consolidate hardware from different manufacturers
in the NASA/Shuttle Logistics Depot (NSLD) or the National Payload
Logistics Depot (NPLD) at KSC. There will be a transition cost
for moving commercial and industry people to NSLD and NPLD to
train NASA personnel. But, once again, paying this cost up front
will mitigate the risk of paying excessive cost for single replacement
units or, worse yet, not having the units downstream. As good
as this process is, it also has a risk because some contractors
have proprietary processes and do not want to participate in small
quantity outyear procurements. This will require NASA to buy the
companies' capital testing and/or production equipment to produce
critical outyear spares in-house. The ISS Program is planning
to reengineer or redesign critical parts (e.g., the Major Constituent
Analyzer and some computer system components) so that, for example,
the redesign of a circuit board or integral part of a system can
be upgraded without changing the form, fit and function of the
replacement part.
Funding constraints and lagging development have increased spares
acquisition costs and eroded delivery schedules. To contain near-term
spending to within the funding profile during peak development,
decisions were made to reduce contracting for spares and parts
necessary to support the current schedule for the ISS. Various
program activities were hardware-limited during the development
and test phases. Not procuring adequate spares during the initial
production run of some components introduces quality and consistency
issues as well as increased cost.
Although the normal industry approach is to produce spares late
in production runs, discontinuities have occurred when flight
production has slipped. When the spares acquisition organization
has to pick out a production unit to garner for its spares procurement,
manufacturing has to produce an additional unit for a replacement.
If spares are not produced during the production run, additional
costs are incurred, including the retention of critical engineering
skills. In at least one instance, "EEE" parts (high
reliability parts) were bought in two purchases. Spares acquisition
missed the production run and paid the price for discontinuity
in the form of lot charges and high costs for single acquisitions.
ORUs are currently being produced, but the qualification program
is lagging, holding up spares acquisition. The Program has also
experienced the opposite case: having to restart production lines
that were shut down after flight unit deliveries were completed
because adequate funding was not available to procure spares at
the time.
To avoid issues such as this, it is critical that the ISS logistics
and manufacturing functions jointly plan and coordinate spares
requirements, insuring that delivered spares, production diversion,
and backfill are always in proper balance.
3.2.10 Training
At the time of the writing of this report, there were instances
where prototype training hardware was not yet available for training
on key components of the various systems. Delivery delays of both
hardware and software are having a direct impact on training preparation.
Late hardware delivery and checkout often results in operational
workarounds that must then be factored into training procedures.
Delays in operational software delivery, integration, and testing
are further impacting training, because astronauts interface with
the ISS largely through the eyes and ears of the command and control,
data analysis, and mission support software. Late deliveries can
result in training personnel being outside the loop relative to
late design changes in hardware and software. Existing training
manuals and those currently being written are apparently based
on the original design specifications, not on the as-built system
that will likely depart from the original design in several noticeable
areas.
It is imperative that early flights have integrated training procedures
reflecting current hardware and software design configurations.
Flight procedures must be adequately developed and tested using
simulated conditions with the flight crews.
Furthermore, Russian and American training procedures have developed
separately over the past 40 years and differ significantly in
many respects. Classroom vs. hands-on, extensive written training
manuals vs. simple lists of directions, and independent initiative
on-orbit vs. dependence on decisions made on the ground are but
a few differences of approach. When the CAV Task Force reviewed
the training program, there was no agreement to merge the training
approaches into one unified program.
The Program has provided its assurance that these crews will be
fully trained on all critical systems prior to flight. The CAV
Task Force is not taking issue with flight safety, only that significant
cost and schedule risk exist in this area.
The space experience of both NASA and the Air Force support the
view that significant schedule slips associated with only one
or two of the cost and schedule risk elements investigated by
the Task Force can, by themselves, force major delays in the overall
ISS completion schedule, even if all other possible risks considered
do not materialize. Software integration and test are often one
of those critical issues that can delay a program far beyond expectations,
even after all hardware is built and ready for operations. In
the ISS case, the Russian-built Service Module could have much
the same effect -- its unavailability at a critical point in the
schedule would force an extended delay in all scheduled flights
associated with human presence on the ISS. It follows from this
analysis that it is not necessary that all possible cost and schedule
risk scenarios come to pass for the Program to experience significant
schedule slippage and cost growth. All that is required is that
one or two strategically scheduled risk elements materialize.
Analyses by the Task Force, along with schedules produced by the
Blackhawk Management Corporation (especially the most recent such
schedule, dated February 17, 1998), indicate rather convincingly
that virtually all initially allocated schedule margins associated
with the events that the CAV Task Force has deemed critical have
essentially been used up. While several program-identified risks,
some of which have been closed and others of which remain at least
partially open, have been covered by the initial schedule margins,
significant risks that may have already adversely impacted the
Program schedule are left without any margin of coverage.
Each significant risk will induce, with some degree of confidence,
a probable schedule slip and an additional cost. The exact length
of the schedule slip and the exact amount of additional cost are,
of course, unknown at this time, but the most optimistic and most
pessimistic scenarios in each case have been estimated by the
Task Force. In each case, the eventual value of schedule slip
or cost growth to be experienced is represented in our analysis
by a number selected statistically from the interval between the
most optimistic and most pessimistic values.
Estimation of probable cost magnitudes (along with their associated
confidence levels) by statistical analysis allows the Task Force
to provide estimates of required funding levels that are tied
directly to the major sources of risk. The cost to Assembly Complete
has been calculated on the basis of covering specific risks at
specific levels of confidence. Statistical treatment of the dollar
cost of overcoming the identified risks is necessary because of
the high degree of uncertainty inherent at this time in how virtually
all the risk issues identified are to be resolved, from Russia's
ability to complete the Service Module in a reasonable amount
of time to the Prime contractor's ability to test and integrate
all the software from the various International Partners.
3.3.1 Schedule Impact Assessment
Consideration of feasible ways to resolve the major risk issues
(i.e., the risk issues that have the potential to significantly
impact ISS Program schedule and cost) leads directly to quantification
of probable Program schedule and cost. Uncertainties in how much
time and money will eventually be needed to resolve the issues
can be bounded below by Program management's optimistic ("best-case")
forecasts and above by the Task Force's understanding of the "worst-case"
contingencies likely to affect the Program. Statistically, however,
an "average" case (i.e., neither the "best"
nor the "worst" case) will actually occur, so a statistical
picture of ISS cost and schedule to Assembly Complete can be derived
by modeling and simulation of risk-issue resolution options.
As an example, consider the logic of the Task Force's quantitative
assessment of the probable schedule impact of the critical issues
associated with the Russian-contributed Service Module. (See Section
3.2.1 above for the technical and programmatic details.) The optimistic
(best-case) scenario envisions a four month schedule slip in delivery
of the service module due to (1) current delays in Russian government
funding provided to RSA, (2) current delays in delivery of subcontracted
parts and components to Energia, and (3) the need to test and
qualify parts and systems after delivery and integration.
The pessimistic (worst-case) scenario assumes a Russian failure
to meet its commitment to deliver the Service Module and envisions
a 24-month slip in the ISS schedule as the U.S. NRL prepares the
ICM as a replacement. Intermediate schedule slips (the "average"
cases referred to in Section 3.3 above) lasting between four and
24 months, with the longer slips increasingly less likely, can
be attributed to (1) a longer-than-anticipated delay (e.g., 8
to 12 months) in Russian funding provided to RSA, or (2) need
for rework uncovered during qualification testing of Service Module
parts and the integrated unit.
A similar analysis has been carried out for each of the other
risk issues identified as possibly exerting a significant impact
on ISS Program schedule and cost. The specific risk elements considered
by the CAV Task Force and their estimated optimistic and pessimistic
schedule impacts are listed in Table 3-1 below.
The Root of the Sum of the Squares (RSS) of the optimistic (best-case)
and the pessimistic (worst-case) slippages in Table 3-1 are statistical
indicators of the probable minimum and maximum schedule slip in
the total ISS program. The RSS takes account of the fact that
there will be schedule slips attributable to some, but not all,
of the risk elements identified. The RSS of the pessimistic slippages
is approximately 38 months, a possible slip of a little more than
3 years beyond the currently scheduled Assembly Complete date
of December 2003.
POST-REV. C SLIP (MONTHS TO ASSEMBLY COMPLETION)
Related Tables
| Risk Elements | Most Optimistic | Least Optimistic |
| Russian Service Module | ||
| Russian Logistics Support | ||
| Flight H/W Delivery (Qual) | ||
| MEIT II (Cumulative) | ||
| Software Integrations | ||
| Training (Cumulative) | ||
| Crew Return Vehicle | ||
| MEIT III (Cumulative) | ||
| US Laboratory | ||
| Assembly Complexity | ||
| ROOT-SUM-SQUARE | ||
Notes: (1) Months of slippage suggested are reduced if some of the slippage occurs while a prior item is slipping, i.e. beneficial effects on certain critical issue issues of slipping of prior events is taken into account. For example, if the Service Module slips, then it is possible, at least in the optimistic case, that slippage of Training, Software Integration, and Crew Return Vehicle will not exert any additional negative impact on the overall ISS schedule. Slippage in Qualification Testing and MEIT, however, will probably not be covered by any slippage in the Service Module, since these items apply to the Service Module.
(2) The parenthetical note "Cumulative"
attached to some critical issues means slippage due to that issue
occurs over the entire ISS schedule, not simply the initial incident.
This applies to Training and MEIT, which must be undertaken throughout
the entire ISS schedule.
3.3.2 Cost Impact Assessment
The various possible scenarios leading to schedule slippage have also been analyzed with respect to their impact on cost growth. In estimating ISS cost to Assembly Complete, cost growth is anticipated to arise from three distinct sources: (1) costs incurred throughout the program network by the need to maintain a "standing army" or other constant monthly expenditure flows while awaiting delivery of one or more critical components; (2) costs incurred by the U.S. due to failure of Russia to deliver the developed, integrated, and fully tested Service Module within 24 months of its scheduled delivery date and/or to provide required launch or logistics capability at any stage of the Program; and (3) costs incurred in completing specific risk-element work packages (listed in Table 3-1) for which the U.S. has assumed primary responsibility.
The transition to cost growth from schedule slip in situation
(1) above has been made using the so-called "burn rate"
(or rate of expenditure of funds) by those aspects of the Program
that are either actively or passively impacted by stretchout of
their schedules. In case (2), where the risk is that the Russian
Service Module will not be available on schedule, no additional
U.S. expenditures will be required unless the Russians fail to
deliver the module within 24 months. If they do fail to provide
it within 24 months, U.S. expenditures will be needed to complete
and deliver one or two ICMs as replacement vehicles.
POST-REV. C COST (BILLIONS OF DOLLARS TO COMPLETE)
| Risk Elements | Most Optimistic | Most Pessimistic |
| Total Schedule Slippage* | ||
| Russian Service Module** | ||
| Russian Logistics Support** | ||
| Flight H/W Delivery (Qual) | ||
| MEIT II (Cumulative) | ||
| Software Integrations | ||
| Training (Cumulative) | ||
| Crew Return Vehicle | ||
| MEIT III (Cumulative) | ||
| US Laboratory | ||
| Assembly Complexity | ||
| ROOT-SUM-SQUARE (RSS)*** |
* As indicated earlier, these dollar figures are costs incurred throughout the program network by the need to maintain "standing army" or other constant monthly expenditure flows while awaiting delivery of one or more critical components. They are not related to any one or more risk issues and are not included in the statistical analysis described below.
** As mentioned above, even if the Russian Service Module does not become available on schedule, there will be no additional U.S. expenditures required unless the Russians fail