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Aerospace Corp.: Profile Low, Power Great : Company is Architect of Pentagon Spacecraft and Launch Rockets

July 07, 1985|RALPH VARTABEDIAN | Times Staff Writer

But it also operates with a long list of restrictions imposed under its Air Force contract, which accounts for more than 90% of its revenues. (The balance comes from contracts for several civilian government agencies.)

Aerospace is oriented to avoid any stake in the outcome of the multibillion-dollar programs that are affected by its blueprints and technical advice. But the company's work has significant effects on the direction of U.S. weapons policies, because its technology assessments help determine what is possible.

"An architect never makes a value judgment," Rechtin says. "If you ask me what I think of the strategic defense initiative, I could answer you only in technical terms. Our job is to say that if you want to do that, here is the best that can be done."

All of the normal corporate and institutional instincts--sales growth, dominance of new markets, public recognition and financial power--are contravened by the company in an effort to provide as independent a voice as possible in advising the Air Force.

"You would have a hard times figuring a better invention than we for certain kinds of work," Rechtin says. "We have no conflict of interest. We work hard at making sure there is not even a perception of a conflict of interest. We have no stockholders. We do not contract out to others for construction of spacecraft. We are prohibited from seeking to influence legislation."

The company was formed by spinning off the Space Technology Laboratories of the Ramo Wooldridge Corp., forerunner to TRW Corp. In those days, Ramo Wooldridge was prohibited by the Pentagon from building hardware.

No Conflict of Interest

Simon Ramo, a TRW founder, said he originally suggested the formation of Aerospace to avoid the conflict of interest in which his firm was bound to fall if it continued to provide the Air Force with systems engineering services. Ramo also wanted to free the firm to move into manufacturing space hardware.

"We took a financial beating of millions of dollars in setting up Aerospace, but we felt there was a problem that needed to be solved," Ramo says. "Sooner or later, somebody would have said 'Look, these guys aren't helping the nation.' "

The resulting company is separate both from the Air Force Space Division, which manages space programs, and from industrial contractors, which build equipment. It is a system of management that differs sharply from other areas of military procurement.

Lt. Gen. Forrest McCartney, commander of the Space Division, says the Aerospace formula has served the Air Force well.

"Space is a strange animal," he says. "Aerospace satisfies a specific national need. They are essential."

Some experts believe one reason the firm is growing even more important to the military is the brain drain that has thinned the ranks of technically experienced military officers in recent years.

"Our officers left for industry in droves," says William Henry, former commander of the Air Force Space Division. "When I retired in 1983, more than one-half of my work force was lieutenants, which means they had less than five years experience. When I came out here in 1974, we had only one lieutenant in the whole organization."

'Corporate Memory'

Aerospace has provided a "corporate memory" that has bridged the turnover of Air Force officers on long-lived programs, McCartney says.

In an era when the Defense Department has been widely attacked for its stewardship of public funds in almost every type of military program, the Air Force's space programs have been relatively unscathed.

The Air Force has posted a better than 90% success rate in its launches and an 80% success rate in the operation of its satellites. It is a notably successful record because the military typically has far more demanding missions in its space programs that push technology to its limits.

At the same time, the Air Force has come to rely on fewer, but more capable satellites to fulfill its needs. While the Air Force launches about a dozen satellites each year, the Soviet Union launches over 100 each year.

"The Russians put them up and they crap out," Rechtin says. "They are still back in the era of technology that we were in in late 1960s or early 1970s. They have lots of them and they don't work well."

Although Aerospace shuns taking credit for those successes, it has played a key role, says space expert Peter Glasser, a vice president at the consulting firm of Arthur D. Little Inc.

"Aerospace is independent in its views," Glasser says. "Its well-being doesn't depend on whether a program grows very large or is abandoned."

Has Its Critics

But its role as an independent voice in a controversial defense procurement system has also won the company its share of critics, both in government and in industry.

Much of the firm's work is granted on a non-competitive basis, which rankles competitors who would like to bid for the work and members of Congress who would rather see greater competition.

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