4 ms·
Yes, from an economic standpoint that's the primary reason. Boeing primarily does spaceflight contracts on a "cost-plus" basis (i.e. their profit is a fixed %,
by upwardbound 3y ago
Yes, from an economic standpoint that's the primary reason. Boeing primarily does spaceflight contracts on a "cost-plus" basis (i.e. their profit is a fixed %, such as 10%, of their their expenses), where they make more money if they take longer and use more expensive components. SpaceX primarily or maybe even entirely does their contracts on a "fixed price" basis, where they make more money by doing things faster and with cheaper components.
In a rationally-run corporation (of which real ones are merely an approximation), these profit incentives will trickle down into things like the culture of the team and the decision-making criteria used and decision processes used.
The cost-plus contract was popularized by the US military in WW2 because it allows a way for the military to sign a contract without the scope of work being known - bypassing most or all of the contract negotiation phase, and saving months or a year. The military can say "just make it happen, I don't care how, just do it, and I'll pay you your costs + 10%". https://quizlet.com/11795259/251-flash-cards/ https://quizlet.com/11795259/251-flash-cards/
However, in WW2, the cost-plus defense contractors still worked very fast, despite the lack of a profit incentive for fast work, because they were motivated by a survival incentive (if they didn't work fast enough, they'd lose the war and possibly be killed).
- atonse 3y agoRight and the analogous consulting model is Time and Materials (I'm in the DC area and have worked for defense contractors, quite familiar), all these structures don't incentivize contractors to actually do efficient work, which is why we (my company) generally don't like to bid on T&M contracts and prefer fixed price, I like the challenge of finding efficiencies.
- upwardbound 3y ago> we (my company) generally don't like to bid on T&M contracts and prefer fixed price, I like the challenge of finding efficiencies. As a taxpayer, thank you!
- protomolecule 3y ago"they'd lose the war and possibly be killed" Not really. The US was safe behind the oceans.
- silotis 3y agoIt was less "I might be killed" and more "my son/husband might be killed".
- protomolecule 3y agoEver wondered where '21 Pilots' got its name[0]? "All My Sons is based upon a true story, which Miller's then-mother-in-law pointed out in an Ohio newspaper. The news story described how in 1941–43 the Wright Aeronautical Corporation based in Ohio had conspired with army inspection officers to approve defective aircraft engines destined for military use.The story of defective engines had reached investigators working for Sen. Harry Truman's congressional investigative board after several Wright aircraft assembly workers informed on the company; they later testified under oath before Congress. In 1944, three Army Air Force officers, Lt. Col. Frank C. Greulich, Major Walter A. Ryan, and Major William Bruckmann were relieved of duty and later convicted of neglect of duty." [1] [0] https://en.wikipedia.org/wiki/Twenty_One_Pilots#Name,_iconography,_and_fandom https://en.wikipedia.org/wiki/Twenty_One_Pilots#Name,_iconog... [1] https://en.wikipedia.org/wiki/All_My_Sons#Background https://en.wikipedia.org/wiki/All_My_Sons#Background
- paleotrope 3y agoAlso the incentive of not having their companies effectively nationalized and put to work building some one else's product.