Lockheed's Stevens wins top executive award

It's been a year since Robert Stevens took the lead at the largest defense contractor in the nation, and Lockheed Martin Corp. hasn't missed a step ? in some areas, it's picked up its pace.

"2005 thus far has been a very good year for the corporation. All five business areas, all horizontally integrated, have had excellent performance both operationally and financially," said Stevens, chairman, president and chief executive officer of the Bethesda, Md., company.

Stevens was picked by Washington Technology's sister publication Government Computer News as the Industry Executive of the Year. Other winners of GCN's annual gala awards are listed on page 18.

BOOMING BUSINESS

Stevens' first year at the helm of Lockheed Martin has been one of business as usual and business not so usual. The usual: Lockheed Martin keeps winning myriad contracts with the government. The not so usual: Many of them are not defense deals.

"We are not 'just' a defense contractor," Stevens said. "A significant portion of our business is in civil government, including IT services. This portion is growing more rapidly compared to other segments."

The latest catch was announced Sept. 26 as Lockheed Martin's team won the Census Bureau's Decennial Response Integration System deal, a six-year, $500 million contract to develop and run an information processing system for the 2010 census. The company Sept. 9 snared the National Archives and Records Administration's $308 million contract to build the Electronic Records Archives system.

Then Sept. 6 brought news that the company won the New York Metropolitan Transportation Authority deal, worth $212 million over three years, to upgrade the authority's electronic security infrastructure.

"Looking at the very recent past, we weren't in the adjacent lines of business that we're in today," Stevens said. "We didn't have a prime helicopter program, which we now have with the presidential helicopter. We didn't have a ship building opportunity, as we do today with the Littoral Combat Ship. We didn't have more than half of our revenue and earnings generated from systems and IT. We're seeing across the company a more balanced portfolio, with more content from systems and IT."

Stevens became chairman of Lockheed Martin April 28, following his Aug. 6, 2004, assumption of duties from former chairman and CEO Vance Coffman, who retired after 37 years. Coffman called Stevens "an exceptional leader with great vision and a deep understanding of the industry, our customers and our corporation," in a March 2004 announcement of his retirement.

Stevens' vision likely was shaped by a steady climb up the executive ladder. He arrived at Lockheed Martin in 1993 with the company's purchase of Loral Systems Manufacturing. He was executive vice president, senior vice president and chief financial officer of Air Traffic Management, and has held increasingly responsible positions since. In October 2000, after Louis Hughes resigned as president and chief operating officer, Stevens took on the job as well as keeping his duties as CFO, a role he had landed just a year earlier in October 1999.

Stevens said he sees Lockheed Martin as "partners with our customers sharing a unified vision: deliver the technologies customers need to address their most pressing priorities and achieve success at their defining moments. Our philosophy is to be regarded as the best, most trusted, highly competent systems integrator with a focus on national security missions."

HIGH FIVE

Stevens said he feels the company's growth and operating excellence begin with a focus on its federal customers and U.S. allies while emphasizing five particular areas.

In defense, Stevens said, Lockheed Martin wants to add to its core products and services more adjacent market opportunities, such as the 2004 award of the Littoral Combat Ship and the 2005 presidential helicopter deal. It is keeping watch on the performance-based logistics market.

The company remains a stronghold of support for intelligence agencies and civilian agencies and will continue its pursuit of contracts in both. For the 11th straight year, Lockheed Martin is the No. 1 federal IT provider, and its latest focus here will be on business process outsourcing.

Stevens said the homeland security arena "is clearly our strength," and is pleased over the Homeland Security Department's announced need for systems integrators. The forthcoming Enterprise Acquisition Gateway for Leading Edge solutions contract, known as Eagle, to consolidate IT services and solutions purchasing for DHS, will be one of the largest federal deals of the coming decade, and one Lockheed Martin is likely to pursue.

International business contributes 15 percent to 20 percent to the company. "I particularly like our balance and flexibility to provide and demonstrate platforms and system capabilities. This balance has allowed us to be competitive in the global market," Stevens said. "Our products are highly desired by the international customers."

2005 has been strong, but a big hurdle in 2006 could be the ongoing government budget challenges, Stevens said.

"The military is being stretched to the limits fighting the global war on terrorism. Then along come two horrific natural disasters that put additional strain on military resources, not to mention other government agencies," he said. "You factor in tight budgetary constraints, and it's easy to see that our nation has some big challenges."

Stevens said hurricanes Katrina and Rita have been instructive in several ways, among them the need for enhanced situational awareness and a refined, multitiered command and control structure.

"As we think about homeland security applications with respect to FEMA, and other government agencies, we see the prospect for the application of skills that we have long applied in the defense and intelligence community," he said.

Challenges or not, Stevens said Lockheed Martin is in the "business of invention."

"There aren't many enterprises that fundamentally are taxed with looking into the future, and in some cases, decades into the future," Stevens said. "What we invent today will be applied tomorrow. Interestingly, we are doing it in the bright light of day, with full oversight of Congress, the media and capital markets. And I think we are meeting our customer's requirements very well. It's the business that we're in."

Managing Editor Evamarie Socha can be reached at esocha@postnewsweektech.com.
Individual awards

Defense Department Executive of the Year: Dave Wennergren, CIO of the Navy

Civilian Executive of the Year: Jim Williams, program director, U.S. Visit

Industry Executive of the Year: Robert Stevens,chairman, president and CEO, Lockheed Martin Corp.

Hall of Fame: Charles Rossotti, founder of American Management Systems Inc. and former IRS commissioner

Agency awards

Army Joint-Automatic Identification Technology

Beverly Hills, Calif., IT Department

Defense Military Health System's Electronic Health Record, Composite Health Care System II

Health and Human Services' Geospatial Data Warehouse

IRS' e-Services and e-File

Joint Forces Command's Secure Wireless Architecture

Justice Metropolitan Areas' Interoperability Assistance Project

NASA Columbia Supercomputer

Space and Naval Warfare Systems Center's Joint Protection Enterprise Network

Telemedicine and Advanced Technology Research Center's Battlefield Medical Information System