Case Study
World’s Largest Defense Contractor Reverses Major U.S. Government Rocket Design Contract Shortfall to Deliver $60M EBITDA Improvement
$60M
EBITDA Improvement
Strategic Imperative
To effectively deliver customer contract requirements on time, developing operating cost efficiencies, improving customer satisfaction, increasing award-fee revenue, and reducing a $50M loss
Client Background
- $75B global aerospace and defense company with approximately 123,000 employees worldwide
- Space systems leader with deep engineering expertise in designing and deploying complex mission solutions
- Newly acquired business unit had secured a large, long-term, high-visibility U.S. government rocket-design contract
- Contract execution required coordinated engineering decisions, resource assignments, milestone control, functionality resolution, and customer deliverables
- Government contract performance directly affected customer satisfaction, award-fee revenue, profitability, and high-visibility customer relationships
- After one year, work was significantly overdue and over budget, with functionality issues, only 48% of milestones on time, and a $50M loss
Key Issues & Barriers
- Engineering-centric culture prioritized technical activity over productivity, resource utilization, and disciplined contract execution
- Project team assignments were misaligned with contract requirements, weakening accountability and effective resource deployment
- Unclear project priorities delayed critical-path resolution and prevented timely completion of milestone dependencies
- Poor functionality decisions drove over-engineering, increasing technical complexity, operating cost, and delivery risk
- Team leaders lacked management skills, tools, and training to balance technical triage with delivery accountability
- Team-level management processes lacked clearly defined gating, task ownership, and contract-deliverable controls
Key Implementation Components
- Established and communicated clear performance goals and expectations across project leadership, team leaders, and engineering teams
- Implemented comprehensive team-level management processes to strengthen execution discipline and accountability across project teams
- Defined gating requirements, task definitions, and contract deliverables to improve milestone control and on-time execution
- Developed expert models for team leaders, clarifying roles, responsibilities, and required management capabilities
- Balanced technical triage responsibilities with managerial expectations to strengthen productivity, resource utilization, and delivery accountability
- Designed and implemented new organizational structures to accelerate issue resolution and align teams with contract requirements
Benefits & Results
$60M
EBITDA Improvement
45%
Design Engineering Throughput Increase