A number of factors contributed to cost and schedule overruns and  performance shortfalls. GOES-R Procurement Activities Are Under Way, but System Requirements and Cost Estimates May Change

NOAA is nearing the end of the preliminary design phase on its GOES-R  program and plans to award a contract for the system’s development in  August 2007; however, because of concerns with potential cost growth,  NOAA’s plans for the GOES-R procurement could change in the near  future. In May 2006, program officials estimated that the  life cycle cost could reach $11.4 billion. NOAA officials estimated that a decision on the future scope and direction  of the program could be made by the end of September 2006. The GOES-R Program Office Has Taken Steps to Address Past Lessons Learned, but Significant Actions Remain

NOAA has taken steps to apply lessons learned from problems  encountered on other satellite programs to the GOES-R procurement. Key  lessons include (1) establishing realistic cost and schedule estimates,       (2) ensuring sufficient technical readiness of the system’s components  prior to key decisions, (3) providing sufficient management at government  and contractor levels, and (4) performing adequate senior executive  oversight to ensure mission success. NOAA has established plans designed  to mitigate the problems faced in past acquisitions; however, many  activities remain to fully address these lessons. The delivery of the first satellite was delayed by  5 years. Conclusions

Procurement activities are under way for the next series of geostationary  environmental satellites, called the GOES-R series—which is scheduled to  launch its first satellite in September 2012. Until it completes these activities, NOAA faces an increased  risk that the GOES-R program will repeat the increased cost, schedule  delays, and performance shortfalls that have plagued past procurements. Recent concerns about the potential for cost growth on the GOES-R  procurement have led the agency to consider reducing the scope of  requirements for the satellite series. Appendix I: Objectives, Scope, and Methodology

Our objectives were to (1) determine the status of and plans for the  Geostationary Operational Environmental Satellites-R series (GOES-R)  procurement and (2) identify and evaluate the actions that the project  management team is taking to ensure that past problems experienced in  procuring other satellite programs are not repeated.
Why GAO Did This Study

The National Oceanic and Atmospheric Administration (NOAA) plans to procure the next generation of geostationary operational environmental satellites, called the Geostationary Operational Environmental Satellites-R series (GOES-R). This new series is considered critical to the United States' ability to maintain the continuity of data required for weather forecasting through the year 2028. GAO was asked to (1) determine the status of and plans for the GOES-R series procurement, and (2) identify and evaluate the actions that the program management team is taking to ensure that past problems experienced in procuring other satellite programs are not repeated.

What GAO Found

NOAA is nearing the end of the preliminary design phase of its GOES-R system--which was estimated to cost $6.2 billion and scheduled to have the first satellite ready for launch in 2012. It expects to award a contract in August 2007 to develop this system. However, according to program officials, NOAA's plans for the GOES-R procurement could change in the near future. Recent analyses of the GOES-R program cost--which in May 2006 the program office estimated could reach $11.4 billion--have led the agency to consider reducing the scope of requirements for the satellite series. NOAA officials estimated that a decision on the future scope and direction of the program could be made by the end of September 2006. NOAA has taken steps to implement lessons learned from past satellite programs, but more remains to be done. Prior satellite programs--including a prior GOES series, a polar-orbiting environmental satellite series, and various military satellite programs--often experienced technical challenges, cost overruns, and schedule delays. Key lessons from these programs include the need to (1) establish realistic cost and schedule estimates, (2) ensure sufficient technical readiness of the system's components prior to key decisions, (3) provide sufficient management at government and contractor levels, and (4) perform adequate senior executive oversight to ensure mission success. NOAA has established plans to address these lessons by conducting independent cost estimates, performing preliminary studies of key technologies, placing resident government offices at key contractor locations, and establishing a senior executive oversight committee. However, many steps remain to fully address these lessons. Until it completes these activities, NOAA faces an increased risk that the GOES-R program will repeat the increased cost, schedule delays, and performance shortfalls that have plagued past procurements.