Tuesday, November 15, 2005

ADSR Emailgram

ADSR Emailgram
November 15, 2005

The "hot rumor" is that the NNSA will announce the new O&M contractor
on Friday, November 18. As with most things concerning the
competition, the rumor is exactly that - an interpretation of actions
or schedules at headquarters, and not something that has actually been
announced or stated by the source selection official. However, it is a
possibility, and it is worth reviewing what the announcement would
likely entail:

(1) It is very unlikely that there will be much notice on the

(2) The announcement could be a press release from HQ or a formal
presentation here at Los Alamos.

(3) Once the announcement is made, there is a period of 10 days when
appeals can be filed. This period of appeal means that despite a
contractor being announced, there is likely to be silence from the
winner. This will be frustrating because everyone will want to know
the details of what the contractor has proposed, but do not expect the
contractor to make any major announcements. Once the appeal period has
expired, there will be more news about the plans of the contractor, but
the new contractor will be an intense epoch of information gathering
about Los Alamos, and therefore there will be limited announcements
about specific plans of the contractor.

In aggregate, there could be a 6 week period between announcement of
the new contractor and that contractor announcing detailed plans. At
the bottom of this email is another edition of Q&As - these are ADSR
answers based on our own research, and are not in any way official lab
or UC positions. Further, the answers could be incomplete as more
information emerges.

Also, as reported last week, the House and Senate agreed on the FY 06
Energy and Water Act. The House passed the bill by a vote of 399-17,
and on Monday evening (Nov 14), the Senate passed the bill 84-4. The
President has indicated that he will sign the bill into law and not
require a further continuing resolution.

Last week the Laboratory announced a web page dedicated to transition
(http://transition-int.lanl.gov/). The lab site is the only official
source of information for the transition and should be considered
authoritative. However, in the past couple of weeks, I have been
meeting with focus groups throughout ADSR to talk about transition and
explore issues that are particular to the directorate. Judith Kaye has
researched many of these issues and we have found that many of the
questions are similar across the directorate, and further, many of
these questions have answers based on previous transitions. The Q&A
provided here is a best-faith effort, but should not be considered
official UC or LANL statements.

What will happen to Interagency Personnel Agreements (IPAs)?
The agreements currently in place between the University of California
and other agencies will be transferred to the new contractor.

What will happen to university contracts?
They will also be transferred to the new contractor.

What will happen to fundamental science?
Although we don't know what the contractors actually proposed, the
Request for Proposals (RFP) spelled out the expectation that LANL must
maintain an exceptional Science and Technology program. For a proposal
to be successful in the competition, it must demonstrate that it will
maintain and foster a world-class scientific research capability to
solve complex problems of national security. It is clear that the
solution of problems in stockpile stewardship, non-proliferation, and
emerging threats (including energy security), all require the
capabilities that are in evidence at LANL today.

I've heard that the contract will be extended through October 1, 2006
so that the financial books don't have to be closed twice - once with
the contract change and once at the end of the fiscal year. Is this
We have no reason to believe that there will be any delay in the
effective date of the new contract. In fact, we understand that when
contracts change, DOE likes to close the books prior to the end of the
fiscal year so that they start a new fiscal year with a clean slate.

What will happen to our large student and post-doc programs?
Pertinent to this question, the RFP had the following language in their
statement of work:

"The Contractor shall conduct a science and mathematics education
program at the K-12 (precollege) and university levels to increase the
nation's competitiveness in the global market, to contribute to
developing a diverse, well-educated, and scientifically literate
workforce, and to help maintain the nation's world technical
leadership. This support may include, with the Contracting Officer's
approval, technical assistance; loans of scientific equipment; programs
of "hands on" research experience for students, teachers and faculty
members; a program of encouraging volunteerism and community service;
and cooperative programs."

Contact Me: I encourage you to email me with your questions, comments,
or concerns. My email address is terryw@lanl.gov or you can send
email to my home address with confidence of confidentiality:
tcw@losalamos.com. If you would prefer to communicate anonymously, you
may use the concerns web page at: http://concerns.sr.lanl.gov/.

Terry C. Wallace, Jr
Associate Director for Strategic Research
Los Alamos National Laboratory

Thanks for the honesty. I hope you aren't flamed like some people flamed Gary Stradling when he tried to communicate his views.
I feel compelled to point out a crucial difference between Terry and Gary S.: Terry *seems* reasonable.
Santa Fe New Mexican (In Brief)…
November 15, 2005
The new manager of Los Alamos National Laboratory has not been chosen and won’t be announced until Dec. 1 or later, a spokesman for the National Nuclear Security Administration said Monday. Spokesman Al Stotts of the agency’s Albuquerque office said he has had some inquiries about whether the decision would be announced earlier. “But that’s not the case,” Stotts said by telephone. A group of eight NNSA employees — called the Source Evaluation Board — are reviewing bids to manage the lab. Two teams are competing for the contract, which can pay up to $79 million a year. One team includes the University of California and Bechtel; the other includes the University of Texas and Lockheed Martin Corp. The Source Evaluation Board will recommend a winner to Thomas D’Agostino, a deputy administrator at NNSA. D’Agostino, a Naval Academy graduate, will make the decision, Stotts said. Stotts said he didn’t know when the decision would be made.
One little, itty-bitty detail, my educated friends: The NNSA guy has his legal-eagle ass covered, because there's a 10-day right of recision during which time after the announcement the "loser(s)" of the bidding "bidness" can scream like eagle(s). (Note: December 2nd, a Friday, is indeed 10 bidness days from either Thursday November 17, or Friday November 18.)
Advice for the winner

A couple of years ago, when I still believed Pete Nanos had LANL’s best interests at heart, I sent him the following advice on LANL culture and management. The advice seems to be still applicable today. Perhaps the winning bidder will take this to heart.

Management areas that must be addressed:

1. The absence of a strong program management function that provides third-party over-sight, reporting, and corrective actions for work packages that are in the early stages of trouble. The LANL program management function seems to focus on the beans of cost and schedule without addressing technical issues. Systems engineering is non-existent. This results in crisis management as technical problems fester and then finally bubble to the surface when they are very expensive to resolve.

2. The absence of a structured management development program to give people promoted from the technical ranks the “people tools” they need to do their jobs. There also does not appear to be a management succession plan to identify, develop, and promote well-qualified leaders into the management ranks. There is apparently no mechanism to identify under-performing managers and to offer them a face-saving exit when they don’t work out.

3. A culture of “collegiality” which is analogous to the Military Academy “Ring knockers.” People are reluctant to criticize their fellow workers because of the strong negative tribal consequences and risk of professional ostracism. This builds a “go along to get along” mentality where preserving the UC contract is the ultimate goal and hiding problems is the cultural response. You are not allowed to criticize someone who screws up. I don’t think you can build a culture of continuous improvement and customer focus in this climate.

4. A policy of hiring new grads and post docs with little or no industrial experience. As LANL becomes more involved in big iron engineering projects, people with industrial experience are more and more crucial to success. Hiring inexperienced people means you get to buy their learning curve.

Advice from the trenches:

1. LANL needs to manage their managers, rewarding those who are capable and moving aside those who are not. You need a face-saving mechanism to replace under-performing managers just as you replace under-performing TSMs.

2. Team Leaders and Work Package Leaders (first level managers) need more support and training. The senior management culture must respect their contribution while simultaneously providing the mentoring and oversight they need to keep out of trouble. Project management that focuses only on cost and schedule to the neglect of technical performance is a two-legged stool.

3. LANL needs to build a culture of engineering discipline. There is no apparent attempt at imposing the disciplines of systems engineering, formal specifications, peer reviews, or test and validation plans on product development. Part of it is the LANL prima donna mentality, and part of it is the emphasis on hiring people who have little or no real world experience (new grads and post docs). Emphasizing new grads and post-docs means you are always paying for the learning curve.
SWOT Analysis.

A first step in any significant management decision is a strategic situational analysis, commonly known as a SWOT (Strengths, Weaknesses, Opportunities, and Threats). Here is one insider’s view (non-management) of the situation at LANL just prior to the release of the RFP. Give it the credence you see fit.

§ A large Q-cleared workforce. Replacing a cleared employee takes two years for recruiting, relocating, clearing, and training and five years before they can become effective in many of the highly specialized fields. Having a large pool of already-cleared workers facilitates quick responses to changing work requirements.

§ Uniquely skilled scientific and technical support personnel. LANL has people who have the knowledge, skills, and abilities to do things done nowhere else in the world. This applies to both TSMs and technicians, as there is nowhere else to learn the specialized skills required at LANL other than OJT. These people are not fungible goods, and their skills are not easily duplicated elsewhere.

§ Support facilities and equipment that would difficult or prohibitively expensive to duplicate elsewhere.

§ An attractive physical location and a positive academic reputation help to recruit high-caliber personnel.

§ A national security mission (especially as regards to nuclear weapons and effects) human knowledge base (tribal knowledge) that can’t be replicated elsewhere.

§ Scientific personnel with extensive personal relationships in the international advanced physics, chemistry, and biology communities, facilitating informal communications channels and collaborations. These relationships reduce the delay between scientific discovery and implementation.

The principle weaknesses at LANL are with the existing management, an area where a new contractor could have an enormous positive impact.

§ Failure To Manage Employees

o Internal Communications. Senior management is seen as disconnected from the reality of the workplace and is unable to communicate a consistent, empowering corporate vision of LANL’s future to the rank and file. Employees are in public revolt against current senior management.

o Completing bureaucratic paperwork has become far more important than getting the job accomplished – we have become the work-free safe zone. Technical employees are frustrated by a focus on that places CYA paperwork higher than technical accomplishments and high-quality work output.

o Unionized support trades are expensive, inefficient, and demoralizing to the non-unionized workforce. They are seen as an obstacle to success rather than a partner.

§ Failure To Manage The Organization

o There is no consistent organizational development plan to grow supervisors into managers and instill a culture of managerial professionalism up and down the chain of command. While several functions have the term “leader” in their title, few actually lead.

o LANL needs a two-ladder professional development system, one ladder being the technical side and the other being the management side. In too many circumstances, senior technical people are promoted into management positions due to their technical skills and fail because they don’t have the organizational and people skills to be effective. Having a PhD. in the hard sciences doesn’t confer the skills required to become an effective leader or manager.

o Newly-promoted people spend far too much time in “Acting” positions. The time to decide if a person is qualified for the job is before they are promoted, not after they are in office. Conversely, there is no effective way to identify and remove or reassign under-performing personnel.

§ Failure To Manage The Business

o Strategic Planning. The LANL vision statement is a cornucopia of Dilbert-speak platitudes. There is no strategic planning, but there are many management retreats. Yes, part of this is the political vagaries of the appropriation process, but part of it is that LANL management has been unable to lay out a clear vision of the laboratory’s national mission, concrete steps towards what needs to be done, and then deliver on the promises. Mismanaging technology projects (e.g.: DARHT, LANL’s NIF) with a “cost plus” attitude has destroyed credibility with the funding organizations. Management focus is on CYA paperwork and fear of audits rather than on deliverables and meeting commitments.

o Marketing. LANL management has failed to diversify aggressively into homeland security, biology, and other up-and-coming areas to broaden the laboratory business base and cultivate Work for Others (WFO). Developing new customers (and maintaining existing ones under WFO is left to individuals and is unsupported by the organization. Contracts for WFO are not treated as a corporate commitment, driving customers away and leading to a nuclear weapons monoculture at the lab.

o Bloated Overhead Functions. There is a wasted duplication of support functions because centralized support organizations are non-responsive to mission needs, creating an “underground economy” in indirect labor. Forcing support functions to develop a customer-focused attitude and consolidating functions will reduce overhead and eliminate many “almost full-time but not quite” jobs scattered about the organization.

o Financial Management. Unstable and arbitrarily-adjusted budgeting diverts attention and manpower away from program execution. Management information systems are crude and obsolete. Arcane (and arbitrarily applied) overhead rules that change in the middle of the fiscal year damage budgetary credibility.

§ Failure To Manage External Relations

o Management has failed to sell LANL’s role in national security to the body politic. They should take a lesson from NASA and reach out not just to the academic elites but also to the general public at the Scientific American level. No need for cartoons, but publicity on how LANL supports national science and national security would help counter the negative publicity of past years.

o Manage the quality of LANL-sponsored papers and presentations at conferences. Many of them are science-fair show and tell posters rather than real research.

§ The contract recompetition will provide the opportunity to restructure the entire organization along corporate lines, consolidating many now-dispersed and inefficient overhead functions and breaking up the little fiefdoms.

§ The new contractor’s fee and payment of NM GRT will probably hit the budget for $100M, or equivalent to perhaps 750 FTEs. The promised exodus of near-retirement UC workers will affect not only the technical staff, but also many of the support people. A retirement incentive program targeted at support personnel would help bring the overhead rate under control without invoking a RIF. Turnover at LANL under UC is well below national norms, leading to people “retired in place.” An opportunity to replace these people through retirement will revitalize the organization.

§ Recent crises have brought attention and money to fix long-standing problems such as RedNet. Exemplary execution of the RedNet project will improve LANL’s credibility with NNSA/DOE.

§ A new pit manufacturing facility at LANL will bring stable funding but will require a huge capital investment and long-term congressional commitment. LANL must resist being forced into pit manufacturing in the existing TA-55 facility as it is unsuited to the task and will be more hazardous than a purpose-built manufacturing facility. The argument must be based on embracing the MPF mission and doing it right, rather than undertaking a high-risk activity at a facility ill-suited to production flows.

§ Anti-nuclear forces are gathering political support to shut down anything associated with nuclear weapons, including LANL. These people are working in concert with a vocal minority that has a strong resentment towards people of academic achievement. These anti-academics resent the market-matching salaries that LANL personnel enjoy.

§ Environmental cleanup will consume an ever-larger portion of a gradually-declining operating budget. In this zero-sum game, shortchanging science will become the norm, driving away the best researchers.

§ Pete Domenici’s retirement will provide opening for opportunists like Hobson to cripple the nuclear program. Heather Wilson as his heir-apparent will have zero seniority in the Senate and will not be able to “bring home the bacon” that Domenici does.

§ The mass exodus of experienced personnel will take their tribal knowledge with them. Experienced people are already soured on Nanos’ double-dipper edict and many will take their knowledge with them in July.
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