Making the Team: Lockheed Martin

Lockheed Martin Information Technology

Recent and Upcoming Projects:
Federal Aviation Administration, Air Force/Pentagon Communications Agency. Wide range of Federal projects in homeland security, insurance, health care, Web development

For Information:
www.lockheedmartin.com/suppliernet
(prospective partners should click on "Potential Suppliers" in left column of home page to register)

Special Requirements:
Lockheed Martin or the contracting agency may require security clearances and "cleared facilities" for some projects

When do sub-contractors become involved?
Usually in initial bidding process

Outlook
Lockheed Martin will spend more than $4 billion on sub-contracts in 2005

Special Attention:
Lockheeed Martin will focus on building more relationships in 2005 with service disabled and veteran-owned companies



Early this month, Lockheed Martin Information Technology's health care solutions unit invited 23 small companies ? all prospective subcontractors ? to an all-day briefing and interview session at the company's Center for Leadership Excellence in Bethesda, Md.

In part, the agenda was an audition, as Lockheed Martin's health-care solutions managers spoke with the 23 guests, gauging their abilities to handle upcoming contract projects.

The invitation only open house was one of the ways that Lockheed Martin, which spent more than $4 billion on small-business subcontracts last year, explores alliances with small, specialty companies. Lockheed Martin Information Technology, the government contracting unit within Lockheed Martin Information and Technology Services, subcontracted about $1.3 billion to small companies last year, a sum that is expected to grow this year.

"We brought all of hour health-care solutions managers, the people who make the decisions about what [skills] they need on a team," said Mac DeShazer, a senior manager and small-business liaison for Lockheed Martin IT. During the all day event, program managers described upcoming projects and then conducted personal interviews to look for core competencies, DeShazer said.

"We're getting a feel for these businesses," he said, noting that the invitations were sent to companies on Washington Technology's list of small firms plus "our own database of small businesses that we have worked with and that had a past performance in health care."

Such connections are vital for a behemoth with so many projects underway. At the heart of Lockheed Martin's process for finding small business partners is its "SupplierNet" website (www. www.lockheedmartin.com/suppliernet), which can point prospective suppliers to looming projects. A link on that site steers newcomers to a "Supplier Profile Form" that lets a company register into the worldwide system. Managers from all of Lockheed Martin's operating units look at the site when they need help.

"Everyone across our enterprise has access to it," DeShazer says, referring to Lockheed Martin Corp.'s five business units. "The chance of getting pulled into something with Lockheed Martin is pretty high."

Lockheed Martin is involved in several "Mentor Protégé Programs," which expose small companies to proposal writing, legal issues and other business methodologies. Federal agencies often fund these activities, sometimes requiring such collaboration in contracts. A recent LMIT project brought in several small business subcontractors for a Federal Aviation Administration project for an automated flight services system.

At the Defense Department, LMIT included "a very large small business component" within a $600 million project last year for the Air Force Pentagon Communications Agency, DeShazer said.

Like other contractors, Lockheed Martin has "capture managers" who oversee the development of new projects. These capture managers bring on program managers, who "look at small businesses on the front end of each contract," DeShazer said.

With more than 30,000 potential suppliers on that database, competition can be very stiff. DeShazer said that like any company, Lockheed Martin often turns to familiar partners,

"What drives of lot of that is that we've been working with small businesses and have developed a level or trust in that company to deliver," he said.

Because of the company's wide reach across so many federal projects, Lockheed Martin seeks a variety of talents.

"Skills and expertise run the gamut," DeShazer said. He cited Web development, assurance programs, helpdesk operations, datamining projects, facilities management and software engineering among recent projects.

Getting into the Pipeline

Because of the volume of small business projects, DeShazer said prospective partners to do your homework.

"Don't call us to ask, "What do you have that I can work on?'" he said. "Look at what we're doing, then call about a specific project."

Once a relationship has been established, the initial process can move swiftly.

"We have subcontracting officers who make sure that all resources, all factors are met," DeShazer said. "Sometimes I go out to meet with companies ? if we want to take a close look ? [about meeting] small business goals. We invite them in here."

"These are pretty fast-moving," he adds. The process "can take just a few days."

A big issue in bringing small businesses aboard is labor rates.

"All of that is sorted out early on," DeShazer said. "As soon as we sign an NDA, we start talking about rates and pricing." Such financial issues usually must be hammered out at the beginning of a process so that Lockheed Martin can respond to the agency's request for proposal in sufficient detail, he said.

He points out that for Pentagon contracts, "As part of the proposal process, we sit with the small businesses, establish goals and objectives and submit them to the small business utilization office at DoD for approval before the contract is awarded."

Lockheed Martin pays special attention to minority suppliers.

"We do have a policy of teaming with 8as when they approach us about set-asides," DeShazer said. The company's supplier diversity network, run from Orlando, includes more than 50 diversity representatives. These managers share information about the skills of prospective small-business partners.

"We have a process to place them in front of project managers and 'capture managers,'" who are looking for special skills, DeShazer says. "If a manager sees something he needs on a current contract or one they are pursuing, [he} will sign a non-disclosure agreement and begin the process" of bringing a prospective partner into the project.

He acknowledges that Lockheed Martin Information Technology has some "close-knit networks" which use the same subcontractors "over and over again." But DeShazer points out that with more than 3,000 companies just in the Supplier Diversity Network, there are many ways to reach out to other vendors.

"Lockheed Martin is committed to working with the entire range of small-business categories, from 8as to service-disabled Veteran companies to women-owned businesses," DeShazer said.

The company recognizes that small companies bring special capabilities to the table. A company spokesman points out that, "We will tailor these opportunities to the skills of those partners."

Security clearances often figure into the company's projects, meaning that prospective partners must have or be prepared to obtain appropriate approvals.

"Sometimes the small businesses provide resources for us," DeShazer said, noting that the partners have pools of personnel and cleared facilities. He pointed out that partner companies have usually gone through the process to comply with secure facilities requirements.

Geographical presence is a minor factor in Lockheed Martin's activities, since the company operates in at least 45 states. Nonetheless, it is embracing the Small Business Administration's HUBZone effort to place activities in historically underused business zones.

In addition Lockheed Martin officials acknowleged that it missed its goals in two categories for its small business relationships in recent years. Hence, it is putting greater emphasis on finding partners among service disabled and veteran-owned companies.

"I have encountered some disgruntled small businesses, but the majority who have worked with us [seem to know] we're a different kind of company," DeShazer said.

"It's all about trying to make sure that the small business has a positive experience," he said. "One of the worst things you can do is have someone badmouth you. We're very sensitive to that."

Gary Arlen is president of Arlen Communications Inc., a Bethesda, Md., research firm. His e-mail address is GaryArlen@columnist.com

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