How has technology changed the buying experience for purchasing agents at NASA?
We're trying to establish a "virtual procurement office." There are hundreds of pages of rules and regulations that apply to our buying operations. NASA and Congress are constantly changing those procedures. In the past, it would take weeks or months for the updated rules to reach us. Worse, our people might have to search in a dozen places to find the up-to-date information that they need. The Internet allows us to update and organize the new rules as soon as they go into effect.
Does the Net speed up the procurement cycle?
There are statutory requirements that determine how long purchases have to stay open — usually 30 to 45 days — so the Net hasn't really shortened cycle times. But it has allowed us to get information out to potential bidders more quickly. Most of our rfps [requests for proposals] involve complicated documents that outline what we want to buy. Our people used to create those documents by passing information along in a linear fashion. Now they can work together in parallel.
Ultimately, we would like to be able to reduce the time it takes to move smaller procurements through the process. We hope eventually to be able to say, "Now that bids are electronic, why don't we leave them open for 15 days?"
How else has digital technology affected how you do procurement?
Our linking system, the NASA Acquisition Internet Service (NAIS), has made it easier for people to access the information they need. It's important to level the playing field among bidders. We knew that a big company like Boeing or Lockheed Martin would be able to participate in whatever system we set up. But we wanted to make sure that small businesses would also have access to the agency through the Internet.
NAIS not only links together all 10 of our locations — it also lets companies identify the locations that they'd like to receive postings from. If you're a guy with a pickup truck and a small construction company in Cocoa Beach, Florida, near the Kennedy Space Center, you're not interested in doing business with NASA in California. And you're not interested in selling us telescopes. So we categorize both by product code and by location. Vendors can get updates on any and all combinations — just by registering. It's really easy, and it's open to anybody.
So you're getting more bidders now than you were before?
Absolutely. Now we're hearing from people we've never dealt with before, and some of them are actually winning bids. The Internet allows us to build a better group of vendors, a more diverse group of vendors — and that change has been one of the biggest benefits of this process.
Contact Tom Luedtke by email (firstname.lastname@example.org).
Sidebar: Who Actually Gets NASA's Money?
Last year, NASA's procurement budget came to more than $12.7 billion, up by almost 10% from 1998. Where does all that money go?
In fiscal year 1999, NASA awarded 5,850 contracts, for a total of more than $9 billion. The supplies-and-equipment category (which includes space vehicles, ammunition and explosives, fuels, lubricants, oils, and waxes) accounted for the largest number of contracts — 2,406, for a total of $1.8 billion. The R&D category (which includes space stations, spaceflight, and space operations) was next, with 1,988 contracts, for a total of $2.7 billion.
Small businesses received roughly $3 billion from NASA — more than 25% of the agency's total contract dollars. Of that $3 billion, women-owned businesses received $517 million. (In 1997, NASA contributed three times as many contract dollars to women-owned businesses as it did in 1991.)
Big companies did even better. United Space Alliance LLC, Boeing, and Lockheed Martin got the biggest chunks of NASA's money — $1.5 billion, $1.2 billion, and $900 million, respectively. Together, those three companies accounted for almost 40% of the total cash that NASA awarded.
Sidebar: What Does NASA Spend It On?
Here are some items that were recently up for bid on NASA's procurement Web site.
Sony digital VCR and accessories
Experimental balls "to be used in a research experiment using photography to record the motion of the balls while they are [shaken] in a special chamber. A sample of at least 50 (not to be returned) is desired for the test evaluation."
A pair of 14-foot-by-22-foot subsonic wind-tunnel fan blades
Spaceflight laptop computers
Light fixtures, light poles, conduits, copper, bulbs, and similar items
A next-generation space telescope
Mars Surveyor 2003 lander-mission and Mars Surveyor 2005 definition studies (in preparation for the human exploration of Mars)
A version of this article appeared in the September 2000 issue of Fast Company magazine.