After decades of development, the U.S. missile defense program is facing a first-of-a-kind challenge: balancing the need to continue developing and testing ballistic-missile-defeating technologies against the growing demand to field current-generation systems already proven.

Until recently, Missile Defense Agency (MDA) directors have spent much of their time preaching faith in missile defense technologies. Now, however, the hit-to-kill concept has been proven, at least in tests and some limited operational engagements. Therefore, the new MDA director, likely to be U.S. Navy Rear Adm. James Syring, will face the challenge not of fighting for the technology, but of juggling continued investment in refining missile defense capabilities along with the increasing pressure to field them.

This will come amid a massive downturn in defense spending, as the U.S. political apparatus focuses on decreasing the national debt, and plummeting morale at the MDA. Thousands of agency staffers are being shifted out of Washington, the government has mandated a reduction in the number of support personnel, and MDA employees in recent years have worked under the harsh—some say abusive—management style of the current director, U.S. Army Lt. Gen. Patrick O'Reilly.

Against this backdrop, however, the “threat gets a vote,” in what lies ahead, says one prominent expert in the field. North Korea and Iran continue to pursue long-range missiles as well as nuclear warhead technology and advanced countermeasures. China's work on the so-called DF-21 antiship ballistic missile is also worrying top Pentagon officials because it could threaten Washington's ability to place aircraft carrier strike groups where needed in the Pacific. The Pentagon is said to be demanding that the MDA increase its focus on developing the capability to test defenses to the DF-21. The agency must balance learning from testing against showcasing its capabilities in hopes of forming a deterrent.

Additionally, other nations are building stockpiles of current-generation, short- and medium-range missiles that can be countered by U.S. defensive systems fielded today. The danger of this “raid threat” is that the missiles proliferate far more quickly than the U.S. can deploy a commensurate defense.

Combatant commanders are clamoring specifically for more Terminal High-Altitude Area Defense (Thaad) batteries, produced by Lockheed Martin, and Aegis-ballistic missile-defense systems. Lockheed manages the Aegis engagement software while Raytheon leads the SM-3 Block IA/B interceptor program as well as the larger, more powerful SM-3 Block IIA being developed cooperatively with Japan (see p. 48). Though 90 SM-3 IAs and 48 Thaad interceptors—a complement for two full batteries—have been delivered, the U.S. interceptor magazine is shallow. Commanders fear that these interceptors, as well as the command-and-control and sensor network, could be overwhelmed by a raid attack, which would involve the launch of tens of different missiles, including varying models, launched nearly simultaneously.

An immediate challenge for the new MDA director will be addressing low morale within his ranks, caused largely by O'Reilly's management style. A report in May by the Pentagon's inspector general found that O'Reilly “demeaned and belittled employees” and that his “leadership style and actions resulted in the departure of several senior staff members and caused his senior officials to hesitate to speak up and raise issues during meetings with him.”

Industry and government officials agree that O'Reilly is brilliant and grasps the technology needed for missile defense. He also protected the agency from severe funding cuts—as much as 50% of the budget—originally eyed by the Obama White House. But his leadership style has created problems. “O'Reilly thought that he could do it all by himself,” says the analyst.

Others suggest the new director will have to try to restore a culture that allows for two-way discussions between agency management and staff.

Sources list at least five senior technical/management officials who left the MDA during O'Reilly's tenure. Though they have since been replaced, several industry officials note that their departure signifies a loss of institutional knowledge.

The ranks of support contractor workers were trimmed in order to reduce spending, as well. The Missile Defense Agency Engineering Support Service project was implemented to consolidate the technical support work. “MDA once had more than 400 separate support contractor contracts that were compressed into seven program support areas,” say MDA officials. “Contractors must now compete for individual task orders within the program support areas, and this has often resulted in less people being bid on contracts.” Some observers, however, portend a shortfall of smart, technical people that could jeopardize the success of future programs.

“We lost a lot of real, value-added technical talent. What you are left with is lower-cost folks who are just . . . learning the trade,” the analyst says. “If I were to go after O'Reilly on one thing . . . it is not the thing he is typically nailed for. . . . It is his dissemination of the technical and engineering expertise within the MDA.”

At the same time, the agency was upended to comply with the Base Closure and Realignment Commission. The MDA's headquarters have been relocated from the Navy Annex adjacent to the Pentagon to Fort Belvoir, Va., 18 mi. south of the Pentagon. Roughly 2,300 billets have also shifted from Washington to Huntsville, Ala. Though MDA officials say this is “very much a change for the better,” it has caused turbulence, as some employees were not keen on moving to Huntsville. Now the deputy MDA director will be based in Huntsville, while the director's office will remain in Virginia.

O'Reilly is also criticized for implementing a culture of too much risk-aversion, according to industry officials. These sources, who spoke on the condition of anonymity owing to the sensitivity of the subject, say that an extreme concern about risk has kept the Boeing-led Ground-Based Midcourse Defense (GMD) system grounded from testing since December 2010. The agency has not achieved an intercept since December 2008, because of an issue with the preparation of the detection radar in one case and malfunctions with the Raytheon Exoatmospheric Kill Vehicle (EKV) in others. The cause, however, is known and a fix has been devised, according to several industry sources.

“We are burning a lot of money to burn every one of those risks down,” says one industry official. “We have slowed down the pace of testing in search of excellence on the ground.” But the Aegis/SM-3 program has excelled in recent years in part because “they would not strive for perfection” earlier in the test program, the industry source says.

In addition to the cultural challenges, the incoming MDA director will face a funding conundrum. The maturity of the Thaad and SM-3 programs is prompting regional commanders to argue for fielding them. Traditionally, the MDA has developed a system and then handed it off to the appropriate service once it is proven. The Navy and Army, however, have not assumed responsibility for buying Thaad and SM-3s, respectively, leaving the MDA with a growing bill.

Air Force Lt. Gen. (ret.) Trey Obering, now a consultant for Booz Allen Hamilton, says the Pentagon should reassign purchasing responsibility for these systems to free up money for the MDA to continue developing such capabilities as an advanced kill vehicle that could replace the EKV, new space-based missile-tracking sensors and a boost-phase intercept capability.

The near-term challenge for the agency will be to execute three major flight tests by year-end. This fall, FTI-01 will be a first-of-a-kind demonstration pitting five different targets against Thaad, Aegis/SM-3 IA and PAC-3 nearly simultaneously in order to emulate a small raid threat. Raytheon's SM-3 IB will also undergo an intercept test in the coming months. Perhaps the most critical of the three tests will be a non-intercept flight trial of the GMD program, featuring the upgraded EKV that has frustrated intercept efforts in recent years. If that test goes as planned, agency officials will attempt an intercept in the spring.