Software Failures and IT Management's Repeated Mistakes

Software Failures and IT Management's Repeated Mistakes - IEEE Spectrum

The Paper Strip Problem: How FAA's Caution Avoided Phoenix's Catastrophe While Cementing 1960s-Era Operations

BLUF (Bottom Line Up Front): Controllers at U.S. air traffic facilities still scribble on paper strips—a technology unchanged since the 1960s—while their Canadian counterparts across the border have operated stripless for over a decade. This stark operational divide illustrates the FAA's fundamental modernization dilemma: the agency's $36 billion NextGen program has achieved only 16% of projected benefits over two decades, yet its incremental approach avoided the catastrophic "big bang" implementation failure that turned Canada's Phoenix payroll system into what the Auditor General termed "an incomprehensible failure of project management." The question is whether gradual deployment that prevents disaster but perpetuates obsolescence represents wisdom or dysfunction—and whether pilots crossing into Canadian airspace, reporting a transition "from chaos to professional environment," already know the answer.

Pilots who regularly fly across the U.S.-Canadian border describe an immediate operational contrast: American controllers writing on paper strips, Canadian controllers working with electronic systems deployed nationwide in 2009. The difference extends beyond technology to service quality—Canadian flight service briefers analyze weather patterns and offer professional judgments while U.S. counterparts are limited to reading available data.

This visible divide represents more than different modernization timelines. It captures the fundamental tension between two approaches to large-scale government IT transformation: Canada's Phoenix payroll system crashed spectacularly on launch in April 2016, immediately affecting 70% of 430,000 federal employees with payment errors that persist today at a cost exceeding C$5.1 billion. The FAA's NextGen, by contrast, suffers what might be termed "death by a thousand cuts"—a slow erosion of ambition, budget, and timeline that has nonetheless maintained operational continuity while leaving controllers dependent on 1960s-era processes.

Phoenix: Anatomy of a "Big Bang" Disaster

Canada's Phoenix disaster serves as the cautionary tale the FAA's incremental approach was designed to avoid. Phoenix executives made decisions that would be unthinkable in aviation safety culture: they deferred or removed more than 100 of Phoenix's 984 pay processing functions before deployment, planning to restore them only after full implementation. They eliminated critical payroll functions, reduced system and integration testing, decreased contractor and government staff, and forwent vital pilot testing—all to save money and meet political deadlines.

Most damningly, Phoenix executives proceeded knowing about "serious problems" before launch, including high security and privacy risks, an inability to perform critical functions like processing retroactive pay, and major unresolved defects from testing. They implemented anyway, without project oversight.

The consequences were immediate and devastating. Within months of the April 2016 launch, 70% of 430,000 federal employees experienced paycheck errors. By 2018, the system had generated 384,000 financially impactful pay errors. As recently as fiscal year 2023-24, one-third of all federal employees still experienced paycheck mistakes. The ongoing financial stress led to documented cases of severe harm, including at least one employee suicide that a coroner attributed to unbearable strain caused by Phoenix errors. Total cost to taxpayers: over C$5.1 billion for a system that proved "less efficient and more costly than the 40-year-old system it replaced."

NextGen's Incremental Alternative: Slow Progress, Preserved Operations

The FAA took a fundamentally different path. Since 2003, the Department of Transportation Office of Inspector General reports that FAA has invested over $15 billion on NextGen through December 2024, achieving approximately 16% of total expected benefits. Critical programs like the Terminal Flight Data Manager—designed to replace those paper flight strips—remain years behind schedule and won't reach a wide range of airports until the 2030s. Program costs have risen over 20% while deployment sites have been cut by approximately 45%.

Yet crucially, the system has never experienced a Phoenix-style operational meltdown. Rather than Phoenix's "big bang" deployment, NextGen adopted what GAO termed "a phased approach to modernization that allowed FAA to make mid-course corrections and avoid costly late-stage changes."

Consider the En Route Automation Modernization (ERAM) system, designed to replace 40-year-old computers at 20 Air Route Traffic Control Centers. ERAM experienced extensive software problems that delayed deployment by almost four years with cost increases exceeding $500 million. In August 2015, ERAM failed at Washington Center when a software tool overloaded system memory, causing both primary and secondary channels to crash and forcing controllers to declare "ATC Zero"—suspending all air traffic for over five hours.

Yet ERAM's problems, while serious, were contained through incremental deployment and extensive testing at less complex facilities first. FAA completed ERAM hardware installation in 2008 but didn't achieve program acceptance until 2015. In 2016, the agency updated major system components that were becoming obsolete. This methodical, continuous lifecycle approach prevented systemwide collapse—though it frustrated observers seeking rapid modernization.

"These programs support NextGen objectives with modern software architectures that serve as the platform for new capabilities," FAA documentation notes. "Program lifecycles are continuous with a planned schedule of technology refreshes."

When Contracts Fail: The $160 Million NVS Lesson

Not all FAA programs avoided spectacular failure. The NAS Voice System contract, terminated in December 2018 after six years, demonstrates that the agency is not immune to major disasters—but handled them differently than Phoenix.

In August 2012, FAA awarded Harris Corporation a contract to provide voice-over-IP systems replacing all seven legacy voice communication switches. A September 2015 contract modification that FAA viewed as clarifying requirements and Harris viewed as adding scope created fundamental disputes. Harris struggled with software defects due to poor documentation, missed multiple deadlines, and ultimately proposed extending the contract term by five years—which FAA rejected.

FAA spent $160 million on NVS, including $71 million to Harris for two demonstration systems that didn't work and were eventually dismantled because FAA didn't own the software rights. The termination forced FAA to extend sustainment of aging legacy voice switches through 2030 at a cost of $274 million.

Yet even this failure avoided Phoenix-level catastrophe. The contract was terminated before deployment, not after. Controllers continued using existing systems. No operational crisis ensued. A stakeholder analysis identified root causes: FAA underestimated modification requirements; Harris overestimated its adaptation capabilities; FAA leadership hesitated to hold the contractor accountable; and the agency failed to adjust timeframes when acquisition strategy changed.

The NOTAM Crisis: When Legacy Systems Break

The vulnerabilities of aging infrastructure became apparent on January 11, 2023, when the Notice to Air Missions system—over 30 years old—became unavailable. FAA grounded all domestic departures for approximately two hours, causing over 1,300 flight cancellations and nearly 10,000 delays.

The cause: a contractor's error during routine database maintenance. An engineer "replaced one file with another," not realizing the mistake. The corrupted file affected both primary and backup systems. "It was an honest mistake that cost the country millions," an official told ABC News.

Had FAA's new NOTAM system been in place, redundancies would likely have prevented the cascading failure. With the antiquated system, there was nothing to stop the outages. Congress passed the Vision 100 Act establishing NextGen in 2003, nearly 20 years before this crisis.

The 1960s Architecture That Won't Die

The FAA's modernization challenges are rooted in hardware and software architectures dating to the 1960s—what Military Aerospace termed the "vacuum tube problem."

IBM 9020 mainframe computers installed at Air Route Traffic Control Centers beginning in 1967 remained in service until 1989—over two decades. Based on IBM System/360 technology, these systems could contain up to 12 mainframes at a single ARTCC. The 1989 replacement—IBM 3083 BX1 mainframes—gave way to IBM 9672 RA4 servers in 1999, partly due to Y2K concerns.

More problematic than hardware is the software: millions of lines of code written in JOVIAL (Jules' Own Version of the International Algebraic Language) and Basic Assembly Language. ERAM was specifically designed to replace "key programs written in obsolete Jovial and Basic Assembly languages" with Ada.

JOVIAL, developed in 1959 for military embedded systems, became dominant for real-time command and control systems through the 1960s and 1970s. The FAA's HOST system contained what agency officials described as a software "bowl of spaghetti"—separate hardware and software components physically interfaced without common design, infrastructure, or software environment. Worse, software had been enhanced over decades with site-specific functions in libraries of national and local patches. Most ARTCCs don't use the same patch sets, resulting in unique HOST "builds" for each of the 20 centers.

The vacuum tube symbol became infamous in the 1990s when FAA was reportedly the world's largest buyer, procuring them from former Soviet bloc countries—the only remaining mass producers. Transportation Secretary Federico Peña brought a vacuum tube as a prop when presenting the Clinton administration's ATC reform proposal.

Twenty years later, Chairman Bill Shuster brought paper flight strips to congressional hearings—the new symbol of FAA obsolescence. Efforts to replace paper strips date to 1983. Current plans envision deployment completing by 2028—45 years later. The FAA's 12-year, $344 million Terminal Flight Data Manager contract aims to equip just 89 towers, down from hundreds envisioned in the 1980s.

Meanwhile, oceanic services have used electronic flight strips since the mid-2000s, developed with Airways New Zealand. Over land, multiple pilot programs in the 1980s, 1990s, and 2000s failed to achieve widespread implementation.

This hardware and software debt creates what one FAA official described as a "bow wave effect." In 1998 testimony, the agency expected to spend $160 million in fiscal years 1998-99 just to replace mainframe computer hardware, with another $655 million for four interim projects to sustain and enhance current automated equipment. As John Cardina, FAA's director of architecture and investment analysis, explained: "The way we have mitigated that is by bringing in the new applications on local area network configurations, taking advantage of the networking technology that has come along, allowing us to develop new applications despite the legacy software."

The old FAA approach of building a system and leaving it in place for 20 years "simply can no longer be supported," Cardina noted. Where the agency once worked with six-to-eight-year refresh cycles, that has been cut in half—yet even four-year cycles are insufficient for modern commercial technology evolution.

Most problematically, the software architecture prevents easy modernization. DDC-I, which provides JOVIAL compilers and development tools, notes that "most software implemented in JOVIAL is mission critical, and maintenance is growing more difficult." As of 2010, JOVIAL was no longer maintained by the USAF JOVIAL Program Office, though commercial vendors continue supporting it because hundreds of millions of lines of legacy code remain in use.

The UK's National Air Traffic Services experienced this firsthand in December 2014 when software derived from 1960s JOVIAL code caused a major infrastructure failure. NATS had to train IT staff in JOVIAL to maintain software not scheduled for replacement until 2016. A similar failure in August 2023 caused widespread flight disruptions across Europe.

Legacy software migration costs several dollars per line and typically requires about a year for redeployment—but this assumes the expertise exists to perform the migration. For safety-critical software costing $10-100 per line to create initially, the question becomes: can you afford to recreate it, and can you afford not to?

The FAA finds itself trapped: the current systems work (mostly), but are increasingly expensive to maintain and impossible to enhance significantly. New systems require massive investment and years of careful deployment to avoid Phoenix-style catastrophes. Meanwhile, commercial aviation grows more complex, demanding capabilities the 1960s-era architecture was never designed to provide.

The Canadian Counterexample: NAV Canada's Modernization Success

The contrast with Canada's aviation sector is instructive—and, for pilots who regularly cross the border, immediately apparent. Pilots report experiencing what feels like a transition from operational chaos to professional precision when entering Canadian airspace.

NAV Canada completed nationwide deployment of electronic flight strips in just 11 years after beginning testing in 1998—two years after the organization's creation. The first tests of NAVCANstrips took place in Calgary, Edmonton, and Ottawa in 1998. Between 2001 and 2003, the third prototype iteration graduated to commercial use and began installation across all facilities nationwide. By 2009, electronic strips were universal in Canadian ATC operations.

Compare this to the FAA timeline: electronic flight strip efforts dating to 1983 as part of the Advanced Automation System, followed by decades of failed pilots, with current plans envisioning deployment completing by 2028—45 years after the initial attempt. The FAA's 12-year, $344 million Terminal Flight Data Manager contract with Lockheed Martin aims to equip just 89 towers with electronic strips, down from the hundreds of facilities envisioned in the 1980s AAS program.

Meanwhile, paper strips remain the operational reality across most U.S. facilities. As Chairman Bill Shuster brought a pile of paper strips to a May congressional hearing to illustrate FAA obsolescence, Canadian controllers had been working stripless for over a decade.

The operational differences extend beyond technology. Pilots report that Canadian flight service briefings are "far better than we get in the US," with briefers who provide weather analysis and opinions rather than limiting themselves to reading available data. One pilot recounted a briefer saying: "I've actually been watching that one. It's making about 40 knots and should pass when you're sleeping"—the kind of professional weather analysis unavailable from U.S. briefers.

NAV Canada's structure as a stakeholder-governed cooperative created incentives for efficient modernization. Since users run the system, they have direct interest in keeping costs low while improving service. User fees are now 30% lower in real terms than when first enacted in 1999. Because NAV Canada develops many technologies in-house, profits from selling these products through its commercial arm NAVCANatm subsidize ATC costs domestically—a virtuous cycle impossible in the FAA's government structure.

In 1996, Canada privatized its air traffic control system, transferring operations from Transport Canada to NAV Canada, a private nonprofit corporation. The company paid C$1.5 billion for the system and arranged an additional $1.5 billion in financial backing.

Under Transport Canada, the Canadian Automated Air Traffic Management System (CAATS) had suffered from "excessive cost overruns and extensive delays," according to the Canadian Bar Association. NAV Canada inherited the troubled CAATS program and "implemented and refined a highly modified version" successfully.

NAV Canada deployed space-based ADS-B surveillance nationwide by 2009—more than a decade before the FAA's mandate took effect in 2020. The company's loss-of-separation rate stands at 0.53 per 100,000 flights, compared with FAA's 3.3. Operational costs run $369 per flight under instrument flight rules—cited as 37% lower than FAA's cost structure.

"Since the creation of NAV Canada, and due to the twin demands of safety and cost-effectiveness, the focus has been on extensive use of safety-enhancing technologies," a Canadian Bar Association analysis noted. The company invested heavily in modern control towers in Toronto, Edmonton, and Calgary; modernized the Vancouver Area Control Centre; and implemented wide area multilateration systems.

The privatization model remains controversial in U.S. aviation circles. The Aircraft Owners and Pilots Association and National Business Aviation Association oppose restructuring, arguing that foreign ATC systems face similar challenges and that NAV Canada's ICAO audit scores have declined since 2005. They advocate continuing FAA's existing modernization plan rather than wholesale restructuring.

Yet the operational reality pilots experience suggests a fundamental difference in organizational capability. The Eno Center for Transportation summarizes the contrast starkly: "Despite starting 15 years later [than FAA electronic strip efforts], completed nationwide deployment in just 11 years (and almost two decades before the current FAA timeline) and is now one of the major sellers of the technology, helping to keep costs low for people flying in Canadian airspace."

Program Management Failures: Why Big Software Projects Stumble

Both Phoenix and NextGen suffered from what Oxford professor Bent Flyvbjerg identified in comprehensive data analysis: IT projects are the riskiest from a cost perspective. A 2024 Consortium for Information & Software Quality (CISQ) report estimates U.S. organizations spend over $520 billion annually supporting legacy software systems, with 70-75% of organizational IT budgets devoted to legacy maintenance. An NTT DATA report found 80% of organizations concede that "inadequate or outdated technology is holding back organizational progress."

Robert Charette, writing in IEEE Spectrum's analysis of software failures, notes that drivers of failure "frequently are failures of human imagination, unrealistic or unarticulated project goals, the inability to handle the project's complexity, or unmanaged risks." These factors, identified 20 years ago, "still regularly cause IT failures."

Phoenix exemplified all these pathologies. The Canadian government believed it could deliver a modernized payment system customizing PeopleSoft's off-the-shelf package to follow 80,000 pay rules, implement 34 human-resource system interfaces across 101 agencies, and accomplish this for less than 60% of the vendor's proposed budget by removing critical functions and reducing testing.

"Phoenix's payroll meltdown was preordained," Charette wrote. The project proceeded despite a 1995 failure of a previous payroll system replacement attempt, with Phoenix managers claiming prior lessons weren't applicable—then repeating the same mistakes.

NextGen's failures are more subtle but follow recognizable patterns. A November 2023 GAO report found that since 2018, FAA made "mixed progress" on modernization, meeting some milestones but missing others by several years. COVID-19 delayed system testing and activities, but GAO determined that "closer adherence to five of nine program management leading practices, such as those related to life-cycle cost estimates and risk mitigation strategies, could better position FAA to manage the program."

Specifically, FAA has not updated NextGen life-cycle cost estimates since 2017, hindering budget assessment and performance measurement. The agency lacks a comprehensive risk mitigation plan identifying and prioritizing highest programmatic risks with detailed alternatives analyses.

The Sustainability Crisis: One-Third of ATC Systems "Unsustainable"

A September 2024 GAO report revealed that approximately one-third of FAA's ATC systems are rated "unsustainable"—meaning they face obsolescence, lack vendor support, or cannot be adequately maintained. FAA took an average of four years and seven months to establish basic costs, schedules, and performance baselines for modernization investments, with some projects proceeding for over six years without approved baselines.

This creates a vicious cycle: aging systems require increasing maintenance costs, consuming resources that should fund modernization, while new programs suffer delays that allow deployed systems to age further. The CISQ report notes that legacy systems often use obsolete languages and platforms, making them expensive to maintain and difficult to integrate with modern technologies.

Contract management problems compound these issues. Beyond the $160 million NVS failure, the Air Traffic Control Optimum Training Solution contract suffered approximately $89 million in cost overruns due to poorly defined requirements and ineffective oversight.

Lessons from Contrasting Failures

The divergent fates of Phoenix and NextGen suggest several principles for large-scale government IT modernization:

Incremental deployment prevents catastrophic failure. Phoenix's "big bang" approach maximized implementation risk, ensuring that problems would affect all users simultaneously with no fallback option. NextGen's phased rollout, while glacially slow, allows problems to be identified and corrected before systemwide deployment.

Governance and oversight prevent reckless decisions. Phoenix executives implemented the system knowing it had serious problems, without meaningful oversight to stop them. FAA's multi-layered governance—including DOT OIG audits, GAO reviews, and congressional oversight—may slow progress but prevents Phoenix-level management disasters.

Honest accounting of risks matters. Phoenix executives deferred over 100 critical pay functions to meet deadlines and budgets. FAA's culture, while imperfect, includes mechanisms for escalating technical concerns. The 2015 ERAM failure led to immediate software resolution and automated monitoring tools, not continuation of known problems.

Legacy system sustainment cannot be ignored. Phoenix replaced a 40-year-old system that, for all its limitations, actually worked. FAA's decision to continue funding legacy voice switches after NVS termination, while expensive, prevented operational disruption.

Commercial off-the-shelf software requires realistic modification estimates. Both Phoenix (PeopleSoft) and NVS (Harris's commercial VoIP product) foundered on the gap between vendor capabilities and actual government requirements. The NAS Voice System stakeholder analysis concluded that "FAA underestimated the extent of modification Harris's technology required to meet FAA's needs and Harris overestimated its ability to modify its technology."

The Cost of Caution

NextGen's incremental approach comes with substantial costs. Benefit projections have collapsed from $199 billion by 2030 (estimated in 2013) to $63 billion by 2040 (2024 projection). The DOT OIG attributed this "eye-watering plummet" to deployment delays, economic shifts, and uneven airline adoption of required avionics.

Workforce shortages exacerbate modernization challenges. Reuters reported FAA is short approximately 3,500 controllers from staffing requirements, forcing mandatory overtime and six-day weeks. Overtime costs have risen over 300% since 2013, totaling $200 million last year.

The gap between FAA's reported NextGen benefits and public perception of system reliability creates credibility problems. While the agency quantifies savings in fuel burn and reduced taxi times, these gains are overshadowed by high-profile system failures including radar outages at major airports and the January 2023 nationwide NOTAM grounding.

Industry representatives express frustration with the pace of modernization. Some told DOT OIG that since FAA assumed control of the industry-led NextGen Advisory Committee from RTCA in 2018, "collaboration on modernization efforts have worsened." Concerns about implementation delays and associated delays in being able to use new capabilities create reluctance to invest in NextGen-compatible avionics.

The Political Economy of Modernization

Both Phoenix and NextGen arose from budget pressures driving ill-conceived cost-cutting. Phoenix originated from Prime Minister Stephen Harper's focus on reducing costs after the 2008 recession, with expectations it would eliminate compensation advisor positions and save $78 million annually in operating costs. NextGen emerged from a 2000 summer of severe air traffic congestion and delays, with Congress directing modernization while constraining FAA budgets.

The fundamental tension remains unresolved: Congress mandates ambitious modernization while controlling appropriations through an annual process vulnerable to political dysfunction. The FAA Modernization and Reform Act of 2012 created the position of Chief NextGen Officer to speed implementation and made other management changes, but stakeholders contend "those initiatives have had only a modest effect." GAO agrees: "FAA's reform efforts have not slowed the Agency's overall cost growth or improved operational productivity as intended."

Some, including airlines and the Trump administration, have suggested privatization could resolve these tensions. Canada's success with NAV Canada, along with privatized systems in the UK, Germany, and Australia, provides evidence that alternative governance models can accelerate modernization. However, opponents note that the U.S. has the largest and most complex ATC network globally, and that privatized foreign systems face their own challenges with staffing, delays, and funding.

The FAA Reauthorization Act of 2024 directed that FAA's NextGen offices close in 2025, with responsibilities shifting to a new Airspace Modernization Office. This reorganization represents another attempt to solve through structure what may be fundamentally issues of funding, risk tolerance, and political will.

Conclusion: The Phoenix We Avoided

NextGen has achieved only a fraction of its promises. Critical systems remain years behind schedule. Benefits have collapsed. Costs have soared. Yet for all these failures, U.S. air traffic control continues functioning. Controllers manage over 45,000 flights daily with safety and efficiency that, while imperfect, avoided the catastrophic operational breakdown that Phoenix inflicted on Canadian civil servants.

This distinction matters. The IEEE Spectrum analysis of software failures emphasizes that "not all software development failures are bad; some failures are even desired" when pushing technological frontiers. But "most IT failures today are not related to pushing the innovative frontiers of the computing art, but the edges of the mundane."

Phoenix was a blunder, not a failure—repeating well-documented mistakes in payroll system implementations, most notably Queensland Health's similar disaster in Australia. NextGen is a failure, not a blunder—attempting genuinely difficult technical integration of satellite navigation, digital communications, and automated decision support across a continental-scale system.

The critical question, as Charette poses it, is whether organizations learn from experience. Phoenix managers ignored lessons from Canada's 1995 payroll failure because they claimed those lessons didn't apply. Early evidence suggests the replacement system, using Ceridian's Dayforce platform, is proceeding more carefully with small-scale pilots and transparent development—though at a cumulative cost exceeding $5 billion and counting.

For FAA, the question is whether NextGen's sunset and transition to the Airspace Modernization Office represents genuine learning or merely reorganization. The DOT OIG emphasized that "developing realistic and achievable long-term plans—including comprehensive risk assessments—will be critical to success" in future modernization efforts.

Twenty-two years after Congress directed NextGen planning, and 19 years after IEEE Spectrum's first examination of software failure patterns, the fundamental challenge remains: Government IT projects suffer from "failures of human imagination, unrealistic or unarticulated project goals, the inability to handle the project's complexity, or unmanaged risks."

NextGen avoided Phoenix's operational catastrophe through incremental implementation, technical conservatism, and multi-layered oversight—the very factors that guarantee slow, expensive progress. Whether this represents wisdom or dysfunction depends on one's tolerance for delay versus one's fear of disaster.

For air travelers depending on controllers managing 3 million monthly high-altitude en route flights with ERAM, for pilots requiring NOTAM system reliability, and for airlines seeking NextGen's promised efficiency gains, the answer increasingly appears to be: neither pace nor price is acceptable. The question is whether the next two decades of modernization can achieve what the last two could not.

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