The article incorrectly said that Ronald D. Sugar has been with the company for 29 years. Before working directly for Northrop Grumman, Sugar worked for two companies that were acquired by the military supplier. He has worked directly for Northrop Grumman for eight years.
Northrop Grumman's Chief Executive Set to Retire
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Thursday, September 17, 2009
Northrop Grumman chairman and chief executive Ronald D. Sugar will retire in June 2010, the company said Wednesday.
"At some point you have to say it's time to pass the baton," Sugar said in an interview. "It feels like this is the right time." He has been with the military supplier for 29 years.
Northrop Grumman's president and chief operating officer, Wesley G. Bush, will take the helm next year, the company said. Although Sugar will remain with the company until summer of 2010, Bush will take over responsibilities at the beginning of January 2010.
The change is just the latest among major defense contractors, said Loren Thompson, a defense industry consultant. "What we're seeing is an industry rearranging itself for the difficult times ahead," he said, noting reshufflings at other major suppliers including Boeing, BAE Systems and General Dynamics.
After a decade of growth, the industry might face some belt-tightening, Thompson said, because "we're out of money, the threat may be receding and we have an administration that is more focused on domestic goals."
The consultant said he anticipates a smooth transition for Northrop because the two executives had long collaborated on the company's strategy.
Northrop Grumman, one of the Defense Department's largest suppliers, employs about 40,000 people in the Washington area and reported revenue of nearly $34 billion in 2008.
Sugar has held the company's top positions since 2003. Before working at Northrop Grumman, he worked for two competitors that were subsequently acquired by the company. Sugar said getting the several acquisitions to function as one team was one of his biggest accomplishments.
Going forward, Northrop Grumman expects to grow all of its businesses, said incoming chief executive Bush, but he noted cybersecurity as a relatively new area that is growing in importance.
"It has become clear that the nation has a number of potential vulnerabilities when it comes to the cyber threat," he said. "Cyber knows no geographic borders."
