When the US Air Force awarded the Survivable Airborne Operations Center (SAOC) recapitalization to SNC in mid-2024, it handed one of its most sensitive Nuclear Command, Control and Communications missions to a non-OEM integrator. SAOC – the so-called “Doomsday” plane that provides critical airborne command and control during national emergencies – is the airborne backbone of America’s nuclear decision chain, and a program that in earlier eras almost certainly would have defaulted to a major OEM prime.
In this Q&A, Tom Andersen, senior vice president of SNC’s Washington, D.C. operations, talks about what SAOC says about the rise of mid-tier companies like SNC that bridge the gap between fast-moving disruptive innovators and legacy aerospace giants. He explains how SNC’s focus on open architectures and government-owned technical data and IP reflect a broader shift in how the Pentagon wants industry to deliver speed, affordability and resilience.
Breaking Defense: Before we discuss SNC’s position in the defense industrial base, let’s start with the SAOC recapitalization effort that SNC won in mid-2024. Where is the program right now, and what should we expect over the next 12 months?
Andersen: The program reviews have come in with solid progress reports. We’re still creating the digital twin with what we’re calling our Risk Reduction Asset in Wichita and that process is going well. We’ve taken delivery of the aircraft, and everything so far is on schedule.
Furthermore, both our hiring and retention have been excellent. We probably have about 125 more hires to make in the next six months or so. We’re happy with the progress we’re making, and, more importantly, I think the customer is satisfied. There’s a certain amount of transparency that they’ve been seeing with this program that’s helping too.
When SNC won what is one of the Air Force’s most sensitive Nuclear Command, Control, and Communications modernization efforts, what did SNC put on the table that gave the government confidence that it wouldn’t spiral on cost or schedule?
One is we invested and we invested early. We built 747-size hangers in Dayton, Ohio, well ahead of the contract. In fact, the first 90,000-sq-ft hangar was operational 10 months before the SAOC contract was awarded. In a certain sense, we showed the government that we had skin in the game, we were going to invest, and we had staying power.
Second is that SNC recognized the importance of shared data. If OEMs control data, that’s where a large part of the sustainment escalation comes because that vendor lock is a source of revenue for the OEMs for the next 30 or 40 years of the aircraft lifecycle. I think they’re seeing that in the F-35 program, and you’re seeing that in some of the other big ACAT-1 programs.
Over the last 10 years, we’ve had to invest millions of dollars in our IT systems so that we could do the digital twinning and the digital engineering that the government requested. We realized we can use that same technology to create our own technical data packages so that customers have the “right to repair” and don’t need to soley depend on an OEM anymore.
The combination of our past performance on small- and mid-size platforms, investing, learning how to use new tools, and then being able to create our own data packages was what made everything possible. Interestingly, we may now do more post-production integration work on C-130s than the OEM.
That was a microcosm of what we did with SAOC and the 747. We showed the government how we would do it. This is not an IP or trademarking issue. It’s just creating the data and digital data packages that are needed to do the modifications on aircraft, so you are not locked into the OEM for sustainment. In the case of SAOC, we’re providing the government with unlimited shared data rights from what we create. This ensures the Air Force can quickly make future enhancements and other necessary modernization modifications well into the future.
SNC emphasizes a balance of innovation and manufacturing readiness. Those two concepts are not natural bedmates, but at SNC, you say they are. Tell us about that.
They’re not necessarily bedmates but they should be. If you design a system with open architecture, where the government owns the data rights, you can go a lot faster. I’ll give you a couple of examples.
About 15 years ago, we created the U-28 Draco program – a Pilatus PC-12 used in Air Force Special Operations Command. It ended up being a 30+ aircraft program. We developed four aircraft and got them out in the field in record time – less than a year. Then after the next block of aircraft, we went back and retrofitted aircraft one through four. The reason we could do that quickly and affordably is we had an open system. We didn’t create something that the next best thing couldn’t plug into.
On the higher end, when we were working with an Air Force ISR program about 10 years ago, we bid a solution with open architecture. The customer looked at us somewhat incredulously and said that made no sense because if anyone could work on it, we weren’t necessarily going to get the follow-on work. We said we know that, but wouldn’t it be nice if you wanted to work with us, as opposed to you having to work with us. And I believe this guiding principle of earning follow-on work, which is engrained in our culture, is part of what makes SNC so unique and why our customers view us as a trusted partner.
When we don’t have a disconnect between words and actions, it creates a certain amount of credibility that’s worked well for us and truly is a bedrock of our reputation. This approach was established and is reinforced every day by our owners, and they’ve always believed that for the 30+ years they’ve owned the company.
Let’s discuss where SNC sits structurally in the defense industrial base. You call yourselves a mid-tier prime that serves as a bridge between small innovators, non-traditional defense contractors and major defense primes. Explain.
The truth is, our country needs all of these types of companies in the industrial base, especially now. We like the qualities of these new companies and innovators. We like the speed of innovation that small and agile companies have.
Interestingly, though, when we talk about scaling and surging, everybody’s in the same boat. The OEMs don’t have a warehouse full of widgets or people stockpiled to throw on a new program. The issues of surging and revitalizing the industrial base puts us all into the same boat. But because of our private ownership, we’re more willing and able to invest early and to take smart risks. We always take the long view instead of being driven by quarterly earnings.
From SNC’s perspective, what does DoD need most from industry to accelerate delivery of critical capability?
Our real niche is integration, taking sophisticated and diverse technology and putting it together as fast as possible. I think the DoD is looking for innovation, they’re looking for affordability, not only to procure a system, but for sustainment. And they’re looking for speed because the security environment and threats today demand it.
To conclude, tell us your thoughts on the value of past performance.
We remind people that SNC has been building its reputation quietly, a foot at a time, a yard at a time for over 60 years. We’ve been doing it through performance, and that turns into past performance. We’re innovative, we’re fast, we’re agile, and we have proven performance on critical programs.
None of this happens unless the government trusts us and the best way to earn government trust is with past performance.
But also at some point, as was the case with SAOC, they had to take a leap. Nobody had awarded a non-OEM a program of that scale until we came along. It took two to three years of confidence building and dogged work proving that we could do it, investing early, making sure that the tools were visible, and probably more transparency than the government had seen before. So far, it’s been working, and we look forward to other ACAT-1 programs.