It was not quite a year ago when Huntington Ingalls Industries (HII) reorganized its Technical Services segment to include three distinct business units.
Nuclear and Environmental Services, the unit in charge of business development at Department of Energy nuclear-weapons sites, got an unambiguously DOE-styled spear tip in Michael Lempke, a former procurement honcho from the DOE’s National Nuclear Security Administration (NNSA) who jumped to industry a few years after Northrop Grumman spun off HII into one of the more overtly nuclear companies listed on U.S. exchanges.
Lempke arrived at HII about five years after the spinoff and helped build on a DOE-nuclear portfolio that already included a junior partnership on the management and operations contractor for the Savannah River Site.
To that contract with DOE’s Office of Environmental Management (EM), the agency’s legacy nuclear-cleanup steward, Huntington Ingalls Industries in 2017 added the Los Alamos Legacy Cleanup Contract. The company is the senior partner on lab cleanup manager Newport News Nuclear BWXT Los Alamos, LLC.
Also in 2017, HII became a junior partner on Mission Support and Test Services, the NNSA’s management and operations contractor for the Nevada National Security Site. A year later, the company clinched a spot as an integrated subcontractor for Triad National Security, NNSA’s management and operations contractor for the Los Alamos National Laboratory.
Lempke says the wins, and HII’s future competitive viability at EM and NNSA, stem in part from the company’s ability to indoctrinate workers into the “unique” nuclear engineering culture of HII’s shipbuilding business before shipping them out to the DOE complex.
Lempke spoke recently, by video conference, with Weapons Complex Monitor.
WCM: Where’s home these days for HII Nuclear Environmental?
Lempke: About a year-and-a-half ago, almost two years ago now, we actually relocated from the [Washington], D.C. area down closer to our corporate headquarters here in Newport News, Va. So our office for the Nuclear Environmental group is in the city center of Newport News, Va.
You spent some time at Naval Reactors and later at National Nuclear Security Administration headquarters before you moved to industry, is that right?
It is. I was able to serve for the Navy’s nuclear propulsion program for about 17 years, both in the field and at headquarters. And then [I] went to the NNSA to stand up the infrastructure and operations group as the NA-3 and NA-00. And after about three years there, [I] went ahead and moved out into industry. But great experience with the NNSA, and just phenomenal people that work and serve there.
And while you were at the NNSA, you were the source selection official on the first combined management and operations contract for the Y-12 National Security Complex and the Pantex Plant.
I have no comment on that.
You’ve said that HII is interested in competing for business at every DOE nuclear site, both for the Office of Environmental Management (EM) and the NNSA. Is the company planning to bid on the Hanford Site’s Integrated Tank Disposition Contract? Did you bid on the Idaho Cleanup Project contract? And does HII want to maintain its hold at Savannah River?
We would not be interested in commenting on current or active procurements [Editor’s note: in an exhibit appended to its latest 10-K filing with the U.S. Securities and Exchange Commission, HII listed among its subsidiaries “Idaho Cleanup Completion Partners, LLC.” The LLC was incorporated in Delaware on June 11, 2020, a little less than a month after the DOE solicited bids on the Idaho Cleanup Project contract].
Generally then, how should people assume HII is going to behave when it comes to competition for DOE nuclear business? Are you going to be in on every single competition?
I think you should assume that we are fully committed to the future scope for the Department of Energy across all of their major sites. I will tell you, though, that I think it’s really important to differentiate.
And you should not assume we’re going to bid on everything.
When we look at building teams, we build them to execute the work, not simply to win. And you do that by ensuring you have world-class partners with similar values that allow you to execute in accordance with your values.
We want to bid where we have the ability to make discernible progress and actually a strong commitment to drive the mission forward for the department. If we don’t see an opportunity for us to do that, we’re not going to compete in that. We’re not chasing the money. We’re working on a critically important mission and I think that is an important thing to keep in mind there.
You’ve bragged about HII’s ability to give people some nuclear experience on the shipbuilding side of the business before sending them out to DOE sites. You’ve said this is a way to seed the weapons complex and nuclear security enterprise with the next generation of leaders — but ships and DOE are two different worlds. How much does it really help a DOE site to send them someone who has a bit of experience with nuclear shipbuilding?
So we are actually working not just to provide those folks with the technical, hands-on skills to do their job, but we are actually driving the culture of HII’s nuclear, disciplined operational culture into them. So they arrive actually not just more skilled from a technical, hands-on perspective, but leaps and bounds ahead of folks from a cultural perspective to adhere to culture, drive standards and to help our joint ventures perform for the department at a level of expertise and distinction that a brand new person wouldn’t [have].
And you can bring a college graduate from any good engineering program and they can become an individual contributor in the engineering department, but what they don’t bring is two to three years of solid nuclear culture indoctrination [and] understanding the need to focus on the attention to detail on the rigor and discipline of verbatim compliance with approved technical procedures, with defense in depth, what it means to truly be constructively dissatisfied with the status quo.
Well, other companies could also say that they’re giving people hands-on nuclear experience before sending them to DOE.
I think what we’ve done that is different is that I have 100 people working today in the world’s largest military ship-building organization, delivering nuclear powered ships in support of the nation’s defense, learning that culture specifically to [become] our bench [for] the Department of Energy’s national security mission.
I’m not telling you who can or cannot say it, I’m just telling you what we are doing and I believe it is a differentiator, I believe it’s a big distinction between how we look at the business for the long haul and how others may look at it in a more short-term focus.
So how, and where, have you deployed this deep bench to help DOE?
We have a tendency to insert HII personnel at multiple levels of the organizations that we are proud to be part of. We have probably more than 60 people today that are embedded at the joint ventures we’re working at that are HII employees. [They’re] taking direction from that joint venture, but [they’re] HII employees delivering that HII culture, that HII rigor and discipline and that HII focus on the performance for the mission in a way that, I think, is unique.
One of the challenges you see in the model we have in the DOE is that if you’re looking for cultural change — and you’ve seen that in some of the department’s requests for proposals recently — you’re not going to drive cultural change in a 6,000-employee organization by bringing in two or 10 new leaders, right? You drive cultural change at multiple levels of the organization.
DOE’s Office of Environmental Management has rolled out its end-state contracting model in earnest and is working as we speak to really define what the end-state model means for the people and the sites involved. So far, it’s aspired to create discreet parcels of cleanup tasks at a site rather than just handing a team a to-do list and giving them 10 years to make a dent. Do you think this makes sense? Has it worked so far?
I think it’s a great idea. I think like all great ideas, there’s going to be some speed bumps on implementation, right? There’s agility that’s going to be needed to execute these definitized task orders, there’s going to need to be trust and partnering and collaboration amongst all the stakeholders.
[And] HII as a company is fully supportive of the end-state vision.
We work extensively in task orders with the Navy, with defined end-states and completion scopes, so it’s a process we’re very familiar with and I think it’s a great thing for EM to be able to have a specific sub-element of a larger scope that can actually be completed on time and on schedule because at the end of the day what you’re talking about is, I think, is the big difference between making progress on difficult projects and actually completing or finishing difficult projects.
[It] provides clarity of mission and scope and focus for [EM’s] contract partners and I think it gives assurance to local stakeholders that there is actually discernible, defendable, identifiable progress being made in a completion sense against this larger cleanup activity in each of these areas where they’ve implemented it.
Legacy cleanup at Los Alamos National Laboratory is operating under that model already, and also under the 2016 Consent Order between DOE and New Mexico that likewise looks to break work at the site down into more digestible portions. Do you think that the team HII’s leading there, N3B Los Alamos, is really unlocking the potential of the end-state and consent agreement models? And what can you offer as proof?
I think the team at N3B specifically is performing very well with feedback from the department, through the award-fee process and other indications, it’s been very positive.
We are very focused on that collaborative partnership with a multitude of stakeholders in northern New Mexico. That’s an area where stakeholder engagement has to be tied to everything that you do, and I believe that the team — we’ve got areas for improvement, of course, and we’re self-critical about that — [has] made phenomenal progress on measurable events. We’ve got 35 transuranic [TRU] waste shipments off the mesa, which is amazing. There had been no TRU waste moved off the mesa, I think it was for three or four years, before N3B got there. And we didn’t have any in the first three years of our original scope of work and we’re here now with 35 shipments and we’re going to make another 30 total this year, I think.
Do you think N3B is on a path to earning its options on that legacy Los Alamos cleanup contract?
I’m not privy to what the department is thinking. They call them “options” for a reason across the complex, so what we focus on every day is performing with distinction on the scope of work that is in front of us and controlling what we can control. So we’re constructively dissatisfied with the status quo and constantly focused on continuous improvement. I believe that the accomplishments of that team are solid and strong and measurable and we remain fully committed to the mission.
