Let's Prove Them Wrong
Over the past 25 plus years, the NATO Airborne Early Warning and Control System (AWACS) program has enjoyed a long and very successful history of political success, operational effectiveness, and acquisition excellence. The outstanding acquisition track record would face arguably its biggest challenge with the NATO AWACS Mid-Term Modernization program, a $1.6 billion upgrade to modernize the mission computing, sensors, and communications system for the entire fleet of 17 aircraft. This leadership story describes the issues a small group of mid-level leaders faced and how they turned a potential disaster into a success story. While the agency’s senior leadership was fully supportive and empowered the team to succeed, this success story could not have happened without outstanding mid-level leadership.
In the late 1990s, the NATO Mid-Term program ran into significant technical, cost, and schedule problems that threatened the cancellation of the program. As a result, the prime contractor, Boeing, and the AWACS System Program Office (SPO) agreed to restructure the contract under what was commonly referred to as the Global Solution contract modification. This new arrangement established a new schedule, clarified scope and specifications, and established new prices for work that was left to be completed. It also increased the development ceiling price by $100 million as a result of an equitable adjustment to Boeing.
Senior leadership of the USAF, including Mrs. Darleen Druyun, the former number two acquisition official at US Air Force (USAF) Headquarters, were deeply involved in re-negotiating this Global Solution contract agreement. It was later determined that due to the legal issues (and subsequent conviction of Mrs. Druyun for violating a conflict of interest laws in her dealings with Boeing) that this contract would be reviewed by the DoD Inspector General to determine if this particular contract action was tainted based on Mrs. Druyun’s involvement and to determine if proper business and contracting processes were followed. The DoD IG completed their audit and determined that the Air Force had not followed proper procedures and that it was not possible to determine if the production prices were fair and reasonable. This resulted in the re-opening of the contract with a lengthy technical evaluation to re-negotiate the production prices. Concurrently with this IG investigation, the AWACS SPO was responsible for executing the program, which was a very complex and technically challenging effort. What follows is an account of some of the actions the SPO took to respond to this challenge.
When I first arrived as the Deputy Director of the International Division, it was immediately clear that the NATO AWACS Mid-term program was in trouble. Several of the team members told me of the technical challenges, the low morale, and the constant crisis management mode the program seemed to be in. A few key members of the SPO staff encountered health problems (including more than one heart attack), possibly tied to the stress of the troubled program.
A poor relationship existed between the NATO AWACS Program management Agency (NAPMA) and the SPO. One of the first meetings I attended at Boeing included a shouting match between the program managers of the SPO and NAPMA. It concluded with one of the program managers walking out angry and slamming his fist against a wall. NAPMA and the SPO were also at odds on the health of the program as evidenced by conflicting risk assessments. On top of this, we had to respond to the DoD IG and an unhappy customer (the operational user who would receive the system), who was continually re-assessing their requirements for the system.
In December 2003, my boss (the SPO Director) asked me--the new guy on the scene--to visit Boeing with members of the SPO program management team and conduct a short review of the program. The thought was that I would be able to look at the program with fresh eyes and assess the program’s health and the use of appropriate processes.
I was impressed by the caliber of people I encountered at the SPO, Boeing, and at NAPMA. Many of these people had been working on the program well before the Global Solution contract’s execution so there was also a great deal of corporate knowledge. After listening to several briefings and asking many questions, I believed the team was doing the right things to execute the program--with a few caveats.
The first issue I noticed was that the various teams were not managing to a common set of documented project risks. Many of the functional teams (software engineering, test and evaluation, logistics, etc) had identified risks, but there was little coordination among the teams and no consolidated list that the team had documented and agreed upon. We agreed that at all future meetings one set of risks (and one set of data) would be tracked and updated, and risk owners would be accountable to show what actions were taken and what results were achieved in mitigating the risks.
The second issue we uncovered was that we were not all in agreement over how we were measuring progress. The team was managing against a schedule but there was no single set of progress metrics that accurately reflected where we were in terms of real progress. While this may seem like an easy fix, it was not that simple for a program requiring compliance with hundreds of requirements to ensure the system met system standards. We worked together to develop one set of program metrics that would be tracked and reported on weekly against an integrated master plan. The result was that the team could now see exactly where we were on the plan and what issues and risks needed attention.
The next initiative was building better morale. I conducted many interviews during our visit and I noticed that answers to my questions always seemed to come back to “always fighting fires, don’t have time to do my job, and how are we going to do all this work”. The obvious answer to that was “We have a plan and we know who is working the plan and managing the risks, so let’s resource the plan and determine if we have enough people to do the job. If we find out we don’t have enough people, let’s go ask for the staff we need.”
While this sounds easy, the staffing for NATO AWACS acquisitions is a very complicated and politically charged process. The NAPMO Board of Directors must approve the manpower, requiring unanimous approval of all the NAPMO nations. Further, it would involved a great deal of work and scrutiny since the NAPMO nations had already invested significantly more funding in the program than originally envisioned due to the Global Solution contract modification. Asking for more staffing (and the budget to go with it) was sure to be a tough sell.
To no one’s surprise, we determined that we did indeed need more people to do the work. Now the challenge was to convince senior USAF leadership that this was an issue that needed to be resolved. Once we got the USAF on board, the discussions with NAPMA and the NAPMO nations was required. It took a lot of negotiating and heated debates but eventually we succeeded in getting 13 additional full-time acquisition specialists to manage the program to completion.
While the knowledge that reinforcements were on the way boosted people’s spirits, I believe it was equally important to the team members that their leadership had fought hard to get the resources that the team needed to succeed. It wasn’t long after the additional staff showed up that I again asked how people were doing and clearly the mood had changed for the better. The staff now had time to go home at a more reasonable hour, eat dinner with their families, and take much needed vacations. Now we just needed to get through the last phase of the development program and initial production activities.
Another nagging issue we had was the poor working relationship between the NAPMA and the USAF SPO. This friction was caused by several factors but clearly one of the major reasons was their overlapping roles and responsibilities. When two organizations appear to be working the same tasks, conflict is sure to result.
While NAPMA was designated as the overall management agency for the entire program with authority to plan, coordinate, contract, administer and expend funds, the SPO believed it was responsible for the program’s cost, schedule, and technical performance of the NATO Mid-term program. The SPO/NAPMA relationship was exploring somewhat new territory due to the fact that the initial aircraft purchase and subsequent upgrades had traditionally been executed in a cooperative type arrangement. In other words, both the USAF and NATO fleets normally fielded essentially the same upgrades and could pool resources to manage the program. Fleet configurations were very similar. Now with NATO Mid-Term, the fleets were diverging in a big way. NATO Mid-Term was not part of the USAF modernization plan. In fact, the USAF, for various reasons, started their own similar upgrade program later, and with a very different solution.
To address the working relationship, the team proposed an off-site to define exactly how the two organizations would work together. The off-site would be led by the project managers from each organization and would bring the key players together. A neutral location was selected and the teams “slugged” it out for over two full days. The end result was a clear agreement on roles and responsibilities that was documented and signed by both parties. The other important result of this exercise was that both teams not only agreed to the outcome, they also contributed to it. While there were occasional issues and disagreements between the teams afterward, this off-site resulted in a significant improvement in teamwork. The SPO and NAPMA were now working as a cohesive team.
The final aspect of this turnaround was motivation. How could we motivate a team that had worked so hard for so long without anything to show for it other than a lot of scrutiny, criticism, and investigations?
While it was clear that many observers shared a bleak outlook for the program, it was also clear that failure would be a huge disaster. I believed that the team was now on track to execute the program and we had completed several interim milestones that gave us added confidence. I also believed that we could use the negative outlook of outsiders to our advantage in motivating the team. Just like football teams sometimes use the negative comments of competitors to motivate the team before the big game, I occasionally reminded the team of comments by the naysayers who had said we would never make it and the system would never work. We all wanted to prove them wrong. On one occasion I told a senior official that we had successfully accomplished a major milestone and later found out that the official asked others to verify my statement because it was so hard to believe that we had come so far. Given the history of the program, I could understand the skepticism.
One of the other motivational tools was challenging the team to achieve challenging but realistic stretch goals. The idea was that the team worked to achieve the stretch goals and if they could not make it, they could still make the on-time date which gave us a buffer.
As we got closer to meeting the milestones that we worked so hard to achieve, the team kept their focus on the final objective and was able to overcome frustrating but small last-minute setbacks. After a long road that started with the September 2002 Global Solution contract, the NATO AWACS N-2 Aircraft entered the production and retrofit center in Manching, Germany in November 2005 to become the first operational jet outfitted with the NATO Mid-term upgrade. Nearly one year later, a celebration and ceremony was conducted in Manching, Germany to witness the handover of this aircraft to the operational commander. This was nearly the exact schedule that was envisioned as part of the Global Solution. What a turn-around this was! It was an honor and a privilege for me to be part of this team – for all those naysayers, we proved them wrong!
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