The Aerospace Corporation’s Role in Ensuring the Availability of Critical Technologies
Aerospace and a consortium of industry partners work to identify and mitigate risks
in the technology supply chain.
The Aerospace Corporation’s understanding of the space enterprise is broad and profound, gained from 50 years of experience of operating a federally funded research and development center (FFRDC). Its matrix organizational structure, with many subject matter experts residing in the corporation’s Engineering and Technology Group, allows technology experts and space program offices to share knowledge of the industrial base that affect the government’s ability to acquire critical technologies for satellite programs. In addition, Aerospace’s operation as an FFRDC enhances not only its ability to handle proprietary information that relies on nondisclosure agreements between the suppliers and Aerospace, but also the willingness of industry to share emerging issues based on decades of trust built by Aerospace working alongside government and industry experts.
Aerospace has long been involved informally in ensuring the viability of the space supplier industrial base. In 2002, the corporation began facilitating a more formal consortium consisting of the Air Force Space and Missile Systems Center (SMC), the National Reconnaissance Office (NRO), and the Missile Defense Agency (MDA) to identify common industrial base problems and to pool resources to address them. The consortium formed the heart of the Critical Technologies Working Group (CTWG), which was chartered by the National Security Space Office in 2005 to support the Space Industrial Base Council in creating, supporting, and stabilizing a domestic industrial base for national security space (NSS) and civil space programs.
The CTWG, whose members include representatives from all procuring agencies for government space systems, identifies and funds the most urgent industrial base issues. It meets regularly, four or five times annually, to identify viability issues in the space industrial base and to ensure the health of the companies in the base. To accomplish this, the council provides funding to develop new products or improve existing products at vulnerable companies, or recommends policy changes that can strengthen their technical or financial health.
The Aerospace Corporation’s industrial base assessment process for critical technologies. Working through these stages helps to identify technologies to be considered and whether they require a shallow or deep dive assessment, as well as the mitigation of current and emerging industrial base risks.
The Critical Technology Assessment Process
The basis of the CTWG efforts is the Critical Technologies List (CTL), started in 2003 as a joint effort of Aerospace, the SMC Engineering Directorate, the NRO, and the MDA. The list was initially ad hoc, generated by nominations from various experts at Aerospace, and combined with surveys of system program offices at SMC and NRO. A priority list is created based on factors associated with criticality and vulnerability of each item. An Aerospace subject matter expert is assigned to each item to provide ongoing technical assessment of the technology.
Led by the Engineering and Integration Division working with the Aerospace Economic and Market Analysis Center—the corporation’s focal point for space-related market research and economic analyses—a team performs “deep dives,” which are in-depth looks at market and technical analysis, including a review at the manufacturing site on the most critical items. The CTWG then addresses the most urgent items on the list by acting on recommendations of the deep dives, which have typically been different for each item. At the successful conclusion of each program resulting from these recommendations, the deep-dive process is started again on new items that have reached critical status. The health of the suppliers that have been assisted by these efforts is monitored after each program is complete.
In 2009 the Air Force, NRO, and MDA entered a memorandum of agreement to provide a shared pool of funds to support specific industrial base issues as appropriate. Each agency maintains control over its share of the funds and may support or abstain from supporting individual projects as they see fit. The most common funding strategy has been to channel funds into the Defense Production Act Title III program, which was enacted in 1950 and provides broad authorities, including nonexpiring funding, to the U.S. president to ensure the ability of the domestic industrial base to supply materials and services for national defense. Another strategy entails funding a manufacturing technology via a program enacted in 1956 as a congressional mandate to advance the maturity of manufacturing processes to bridge the gap from research and development advances to full-scale production.
It is important to recognize that industrial base issues are those related to the overall health of the space industrial base and not necessarily to specific delivery problems at individual suppliers. Often programs have challenges in acquiring specific components due to isolated technical or schedule anomalies originating at the supplier, which are not necessarily indicative of the health of the industrial base. These isolated issues are generally dealt with on a program-by-program basis and are not the target of an industrial base mitigation effort unless the issue represents a broader or systemic issue.
Defining the CTL is one of the first steps in the process of technology identification. In this stage, the space acquisition community and Aerospace subject-matter experts are consulted to identify critical technologies. Over the years, the specific metrics and methodology used for determining priorities have evolved as Aerospace and its government counterparts have developed a deeper understanding of the issues affecting the industrial base. In 2008, Aerospace conducted an in-depth review and update of the methodology and assessments contained within the CTL. As a result, a rigorous process has been developed to prioritize individual technologies based on a risk matrix examining the severity of consequence and the likelihood of occurrence.
The 2011 updated CTL contained more than 75 technologies based on inputs from the supply base, SMC program offices, and other government agencies, along with an analysis by technical and financial subject-matter experts on the criticality and vulnerability of each technology. Each technical expert was interviewed by Aerospace’s Economic and Market Analysis Center, which compiled all the inputs into a common framework in a single database. The center has taken the lead for Aerospace in maintaining the CTL, a dynamic database regularly updated as technologies are added to the list and as Aerospace conducts more in-depth assessments that update the risk rating of the specific technology. The 2011 update also provided a review and categorization of technologies originally identified for inclusion.
Given the large number and the future growth of CTL items, it is important to establish a preliminary risk assessment, which measures the relative risk of each item based on a standard framework. The result will enable resources to conduct shallow- and deep-dive assessments to further validate industrial base issues for the items to be investigated. An added advantage of using a standard framework is that it enables the risk profile of items to be updated in the future.
Each CTL item is ranked based on the likelihood of occurrence and severity of consequence. The likelihood of occurrence is a metric to predict the possibility the technology will not be available in the future by examining factors such as single source, foreign source, expertise, and infrastructure and equipment. The severity of consequence provides an estimate of impact to NSS programs if the technology is no longer available by evaluating factors such as time to reconstitute supplier, cost to reconstitute supplier, availability of substitute products, performance degradation caused by loss of item, and number of programs impacted.
By using a common risk assessment process, the CTL provides a relative risk rating of each item to inform stakeholders of potential industrial base challenges. The risk ratings are not intended to provide the complete evaluation of technology risk, but to provide priorities for further technology assessments. The CTL does not take into account marketing assessments, such as specifics on profitability of product lines compared with other items sold by the same supplier, or the parent company’s profitability. Further in-depth analysis is conducted for all technologies identified as high or medium risk within the CTL.
An illustration of the input and output of the critical technologies list. The likelihood of availability and the severity of consequences are generated for each item. Aerospace and the Space and Missile Systems Center determine priorities on this list, gathering input from the government and industry partners.
The proprietary nature of CTL data limits distribution to the U.S. government and Aerospace personnel only. Key takeaways from the CTL risk-assessment process are that it provides a priority list of technologies for further investigation and provides awareness of potential critical technology challenges to the government.
The second stage in the technology-assessment process is referred to as a “shallow dive.” In this stage, the Aerospace subject-matter experts and the Economic and Market Analysis Center examine the technology application, market, and supply base. The experts provide in-depth knowledge of the technology, and the Economic and Market Analysis Center adds additional perspectives by examining the business aspects of the technology and supply base to provide a fuller assessment. Aerospace typically conducts five or more shallow dives each year depending on demand from customers. The shallow dives are primarily used to confirm if there are potential risks for satellite programs in continued acquisition of the technology.
The most in-depth studies conducted by Aerospace are referred to as deep dives and mitigation plans. Because of the resources required to conduct this level of study, only one or two are performed annually based on the technologies of highest concern. At this stage, Aerospace conducts interviews with industry suppliers and buyers to identify industrial base issues with the technology and estimate the market supply and demand. A financial analysis of each supplier identifies potential business-related issues that could have an impact on the availability of a technology in the future. Financial reports of the company and credit ratings can indicate an emerging issue that could affect the company’s willingness and ability to continue offering a product. Interviews with the suppliers provide insight into how the technology fits into the company’s overall strategic plans.
At the conclusion of a deep dive study, Aerospace provides recommendations to the government on whether or not the technology is believed to be at risk. If the risk for continued access to the technology is at a level unacceptable to government customers, Aerospace will build upon the deep dive to provide potential mitigation strategies for the government to consider. The mitigation strategies span the spectrum from maintaining awareness to identification of specific risk mitigation plans.
Examples of various risk mitigation strategies recommended include maintaining awareness, stockpiling, improving efforts to develop technologies development and improve production, gaining advocacy, and policy changes.
The CTWG is currently funding and/or monitoring approximately 15 industrial base items. These include traveling wave tubes, solar cells, solar-cell substrates, readout integrated circuits, Li-ion batteries, star trackers, visible sensors, cryocoolers, infrared detectors, infrared detector substrates, reaction wheels, bearings, printed circuit-card assemblies, and cover glass. These items are in various stages of activity. Currently, Defense Production Act Title III programs are in progress related to readout integrated circuits, traveling-wave-tube amplifiers, Li-ion batteries, and complementary metal-oxide semiconductor imagers for star trackers.
Providing Quick-Look Impact Assessments
The establishment of a common database identifying critical technologies, suppliers, and technology used on programs at Aerospace has proved to be valuable in providing quick assessments to the government on the impact of natural disasters to the supply chain.
On March 11, 2011, Japan experienced a 9.0 earthquake in the Tohoku region, resulting in significant loss of life and damage to several companies from the earthquake, aftershocks, and a tsunami. The initial impact of the earthquake and tsunami on the NSS supply chain was unknown because programs and industry partners typically hold supply chain data. Aerospace initiated a quick-look study for SMC to identify Japanese suppliers in the supply chain and understand any potential supply chain risks for the programs. An initial supplier list was developed using the Aerospace CTL, prior system program office (SPO) surveys, and supplier lists from the national security space primary contractors for satellite systems. To assess the potential impact, Aerospace reviewed news reports, company press releases, and disaster reports from Japan, and leveraged the technology subject-matter expert knowledge of the specific suppliers affected. The experts’ long-standing relationships with the supply base enabled them to provide insights that would not have been available from any other sources.
This assessment identified suppliers with the highest potential to have an impact on the NSS supply chain based on reporting of damage to their facilities and product types. Aerospace found that a majority of the suppliers primarily sustained equipment damage, power outages, and transportation infrastructure damage; however, none of the suppliers identified are known to have been affected by the tsunami or radiation exposure. The assessment provided to Aerospace’s customers within two weeks of the disaster enabled NSS programs to quickly assess the status of their critical supply chains and any cost and schedule impact that would likely have occurred. This report highlighted some potential uncertainties to ongoing programs, which instigated immediate discussion for implications.
The earthquake in Japan helped Aerospace to establish a framework to assess the impact of disasters on the NSS supply chain. Using that framework, Aerospace was able to quickly generate an assessment of flooding in Thailand, which occurred later in the year.
Interaction with Government SPOs and Industry
In 2008, Aerospace conducted a survey in collaboration with SMC to establish a prioritized list of critical technologies from the SMC SPO perspective. This survey was conducted to potentially provide a different perspective on the critical technology industrial base issues from the surveys conducted with the Aerospace subject-matter experts.
In addition to interviewing government SPOs, Aerospace is involved in industrial base interviews to discuss current and emerging supply-chain issues with supply-chain managers at NSS primary contractors for satellite systems.
As part of the technology assessment process, Aerospace conducts in-depth interviews with technology suppliers. Aerospace’s Engineering and Integration Division and the Economic and Market Analysis Center typically lead these interviews. Previously, engagement with industry had been focused on the technology; however, these interviews are increasingly focusing on business aspects such as globalization, international traffic and arms regulation, and commercial markets, as well as issues concerning science, technology, engineering, and mathematics.
Supporting the Government in Programs to Ensure the Availability of Technologies
The assessment process is an important first step in ensuring a stable industrial base, but without action to mitigate the industrial base risks, ensuring continued access to the technologies for NSS programs cannot be achieved.
The formation of the Space Industrial Base Council and its primary working group, the CTWG, has been a successful multiagency collaborative effort in developing and implementing industrial base risk-reduction plans and projects. The Space Industrial Base Council was established in 2005 to provide senior-level oversight of space industrial base issues across the space enterprise. Initially chaired by the DOD executive agent for space and the director of the NRO, the membership included all space acquisition organizations and others interested in the success of the space industrial base. The executive committee consisted of the executive agent for space, the director of the NRO, the administrator of NASA, and the director of the MDA. The president and CEO of Aerospace was an invited member and provided updates on the Aerospace-facilitated industry forums, the Space Quality Improvement Council, and the Space Supplier Council.
In 2005, the Space Industrial Base Council chartered the CTWG to “ensure that critical and vulnerable technology management and procurement practices within the government and industry will provide a long-term stable source of technologies and capabilities required to meet the missions of the NSS community.” In December 2009, a memorandum of agreement between the Air Force, NRO, MDA, and DOD Defense Research and Engineering was approved, establishing the CTWG risk mitigation portfolio. The agreement identified a formal process for approving the multiagency industrial base risk reduction projects, and determined funding contributions from the Air Force, NRO, and MDA. It also identified the process for approving the implementation process. The Defense Production Act Title III office was identified as the procurement agency for the CTWG risk-management portfolio.
Aerospace provided technical and program management support for the formation of the CTWG charter, the development agreement, and the development of the presidential determination documentation. Aerospace also provided industrial base assessment, risk-based priority methodology, and mitigation recommendations to customers at SMC and NRO in support of the CTWG. This data provided the technical background for the projects that would later be targeted for mitigation efforts.
The current CTWG risk management portfolio contains programs that strengthen the domestic industrial base for solar cells, infrared sensors, star trackers, traveling-wave tubes, and critical supply chain elements in support of these technologies. CTWG risk management portfolio members continually assess technologies and industries to identify potential candidates for inclusion in the portfolio.
Mitigation efforts are not limited to the funding available within the CTWG risk management portfolio. In many cases the CTWG collaborates with other government industrial base efforts to develop a comprehensive mitigation approach to maximize synergies and reduce the overall cost to the government. These include NSS agency-specific mitigation efforts, the Defense Production Act Title III office, DOD manufacturing technology offices, the Defense Logistics Agency Strategic Materials, and the Radiation Hardened Electronics Oversight Council.
The U.S. government uses the Defense Production Act Title III Program to establish and maintain the production capability of critical technologies at domestic suppliers the government uses. Aerospace provides technical guidance to its government customers in identifying programs and reviews throughout the program cycle.
The Strategic and Critical Materials Stock Piling Act is one of the potential avenues for mitigating potential risks in the acquisition of critical technologies. The Defense Logistics Agency Strategic Materials manages the national defense stockpile for the government, and this effort supports the risk reduction by stockpiling materials used in critical technologies that could be at risk because of dependence on foreign sources.
In the late 1990s, radiation-hardened electronics supplier issues started to become critical, and the Radiation Hardened Electronics Oversight Council was established by DOD’s Defense Research and Engineering. Industrial base concerns related to these items are continually monitored by subject-matter experts at Aerospace and within the CTWG member agencies as part of the Radiation Hardened Electronics Oversight Council activities.
To ensure continued access to critical technologies for NSS programs, a collaborative effort is often required. An example of a collaborative effort is the establishment of a domestic source for a specific material. The CTWG has worked with the Strategic Materials Agency to establish a stockpile of several different types of critical substrate materials to reduce industrial base risks in the short term while also working to establish a long-term domestic source of supply. Collaboration with the Strategic Materials Agency is critical for those high-risk industrial base materials that require long domestic source development cycles. In several other cases, the group has decided to make last time buy of materials because future technologies will make the material obsolete. Aerospace subject-matter experts and program-management experts support all CTWG efforts along with many other government agency efforts that promote domestic supply of critical space materials. The collective knowledge of Aerospace subject-matter experts is critical in determining the short- and long-term mitigation plans and in understanding the long-term use of a particular material or technology.
Maintaining a healthy industrial base for space-system critical technologies is a difficult effort in the current financial environment. The bulk of the focus by procurement agencies today is centered on reducing the cost of existing systems and not on considering the long-term effects of losing a critical technology. The CTWG focuses on the longer-term viability of critical sources so that future programs have an available source of supply. The risk-evaluation process that Aerospace has developed, coupled with the multiagency CTWG risk-mitigation portfolio and multiagency risk-reduction approaches, provides an efficient way to identify and mitigate the risk of losing critical technologies and materials needed for future NSS programs.
About the Authors
Aaron M. Tout
Senior Project Engineer, Engineering and Integration Division, joined Aerospace in 2008 and has worked in the areas of industrial base; parts, materials, and processes; and radiation-hardened electronics for national security space systems. Before joining Aerospace, Tout worked at a space payload manufacturer in the design and project management of electrooptical payloads. He has a B.S. in mechanical engineering and an M.B.A. from the University of California, Los Angeles.
Senior Project Leader, Engineering and Integration Division, has more than 30 years of experience in space and airborne radar and optical sensors. He was director of space manufacturing at Raytheon before joining Aerospace in 2008. As a member of the Critical Technologies Working Group, Adams works closely with the Space and Missile Systems Center at Los Angeles Air Force Base, the National Reconnaissance Office, and the Missile Defense Agency to develop statements of work and funding profiles. He has a B.S. in electrical engineering from California State University, Fresno.
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