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Date: 17 Aug 92 14:17:15 GMT
From: Dani Eder <>
Subject: NASA statement on Earth Data System proposals [NTE 92-71] (Forwarded)
Newsgroups: (Greg Moore) writes:

>>	NASA has elected, therefore, to offer an additional 
>>opportunity for offerers in the competitive range to 
>>adjust the proposed costs to a more realistic level.  In 
>>instructions issued by the Goddard Space Flight Center 
>>on Aug.10, 1992, as an amendment to the solicitation, 
>>NASA has directed the offerers to submit revised cost 
>>proposals. Changes to the previously submitted technical 
>>and business management proposals will not be 
>>	In addition, Goddard Space Flight Center has 
>>provided the offerers with the provision that will be 
>>used to evaluate the contractor's cost performance 
>>during the contract period.  This provision assesses 
>>significant reductions to the award fee if the 
>>contractor fails to manage and control the program in 
>>accordance with the costs proposed.

This may be an example of the impact of the new NASA Administrator,
or it may just be a artifact of the type of project.  In many past
projects, the thing being built was a first-of-it's-kind.  Thus there
was no real basis for anyone (contractor or government) to say what
it should cost.  Hence the frequent use of 'cost-plus-fee' type
contracts, where the contractor gets paid for whatever it actually
costs, plus a profit (fee).

Despite the fact that no one knows what the project will really cost,
the US Congress wants NASA to tell them in advance what the budget
will be for that project.  So NASA tells them something.  In the
past they wanted to tell congress a small number, on the theory that
a cheaper program has more chance of being approved.  It is useful
in this case to have a small number from a contractor to point to
as justification.  Then when the real program cost is incurred, which
is several times the budget amount, NASA can point their finger and
say 'those bad contractors overran the budget' (and we NASA people
are blameless).

Now, in the long run, constant overruns gets you a bad reputation
anyway for bad management, which image problem NASA has with the
Congress now, and which Administrator Goldin has, I believe, spoken
out against.

On the other hand, the subject contract above is for the data system
for the Earth Observing System.  In this case, the job is similar to
things that have been done before on Earth (i.e. a large data management
and delivery system).  There is data from experience to judge what
a project like this should take - It will take x gigabytes of storage,
so many user terminals, this much software, etc., things that have
been done before.

So, it may just be the nature of the job that caused the evaluation
people to say, hey, this is unrealisitically low, give us some
real bids, guys.


Dani Eder/Boeing/Advanced Civil Space/(205)464-2697(w)/232-7467(h)/
Rt.1, Box 188-2, Athens AL 35611/Member: Space Studies Institute
Physical Location: 34deg 37' N 86deg 43' W +100m alt.

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