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Lockheed CEO Sees a World of Potential

Stevens has developed a reputation as a straight shooter who imposed financial discipline when Lockheed most needed it. A former Marine, he has an intense but personable manner that includes a penchant for one-liners. At a recent meeting of employees at Lockheed's office in Syracuse, he was questioned about the strain on the staff since the firm won several new defense contracts. Stevens paused briefly, then quipped, "I think the bring-a-neighbor-to-work program probably wouldn't work."

That style won him praise early in his career. As an executive at Loral Systems Manufacturing Co., he gained the loyalty of subordinates. "He could wring efficiency out of them because they liked him," said Bernard L. Schwartz, chairman and chief executive of Loral Space & Communications Ltd.

Lockheed Martin chief executive Robert J. Stevens speaks to employees in Owego, N.Y. Stevens, who took the helm in August, had his share of experience working a shop floor. (Kevin Rivoli For The Washington Post)

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Stevens gained prominence at Lockheed in 1999 when as chief financial officer he helped steer the defense giant out of trouble after nearly 20 acquisitions in less than 10 years had left it debt-ridden. He led an internal review that prompted a consolidation of operations, which resulted in 2,800 job cuts and a savings of $200 million. His detailed and frank reports on the company's financial health to Wall Street gained praise among investors, who had abandoned the stock.

"The company had lost sight of blocking and tackling. . . . We lost programs. We had rockets blow up," said former Lockheed chief and current board member Augustine. "The solution to those problems was one word, 'discipline,' and he brought the discipline the company really needed."

Stevens says he has no drastic changes planned for Lockheed. He will focus on initiatives he began as chief financial officer and as chief operating officer. "A company that has a production cycle measured in decades doesn't change direction on a dime. It's an evolutionary change," he said.

He is chairman of a diversity council established three years ago that recommended that short lists for executive positions be required to include a minority candidate. The top priority, he says, is to successfully complete programs as well as attract talented employees. Soon after assuming the chief executive position, Stevens began focusing on a new measurement tool for a program's success: return on investment capital. Soon executives' bonuses will be partly based on the measurement.

Stevens's tenure is likely to be marked by a continued focus on building international partnerships with foreign firms. But those partnerships can be tricky given a reluctance among some members of Congress to share technology with overseas companies and concerns about domestic suppliers losing jobs. Lockheed is currently at the center of a high-profile competition with Sikorsky Aircraft Corp. to build a new presidential helicopter. The battle has stirred international debate since Lockheed is depending on a platform designed by a European firm, AugustaWestland.

Lockheed will not back down from its strategy, Stevens said, adding that he wants Lockheed to be known as the American partner of choice to foreign defense firms. "We see the world as being connected -- connected by financial, trade and security interests," he said. "We think some level of international relationship stimulates those jobs" here.

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