Supporting the Warfighter

Remarks by Marillyn Hewson

Executive Vice President, Electronic Systems

Lockheed Martin Corporation

AUSA’s ILW Winter Symposium and Exposition

Fort Lauderdale, Florida – 2/22/2012

Thank you, General Sullivan, for those warm words… and, more importantly, for your skilled and dynamic leadership of AUSA… which is such a strong voice for Soldiers and their families.   

I’m proud to be an AUSA trustee, and to join you here today.  And I’m deeply honored to be on the same program as General Ann Dunwoody.  She comes from a family whose tradition of military service spans five generations.  And she has blazed a historic trail—for herself, and generations to come. 

My topic today is “Supporting the Warfighter”… a mission all of us share… as we strive to serve an Army that has seen ten years of continuous combat… and has risen to every challenge with courage, creativity, determination, and skill.

And, I know I’ve been invited to speak today as an industry representative.  So I want to start by underscoring a fundamental truth – and that is the respect and sense of connection that men and women across our industry feel for our Army customers.  We are proud to be part of your team… to help you achieve your missions.  Many of us were drawn to this work precisely for that reason.  We chose to make our careers in this field because we too choose to serve a cause that is larger than ourselves.

I started with Lockheed Martin nearly 30 years ago.  And I’ve seen every day the purpose-driven mentality that my colleagues bring to the job… and the special attraction our industry holds for people who truly want to make a difference.  They get the importance of the things we build… and the services we provide.  They take enormous pride in their work… because they recognize how high the stakes.  They’re enormously grateful to our servicemen and women for their sacrifices to keep our nation strong.

And, in many cases, they understand that sacrifice first hand.  At Lockheed Martin, almost one in five of our employees is former military—nearly 20 percent of them Army veterans—and a substantial proportion still have a Reserve or National Guard commitment.  Throughout our plants, you’ll find spontaneous tributes to the troops. 

At our facility in Lufkin, Texas, which was recently honored as one of Industry Week’s top 10 plants for 2011,  they have a wall covered with pictures of Warfighters … including the site manager’s son.  And when I was running the engine business down at Kelly Aviation Center, in San Antonio, our mechanics made a big display on the factory floor, fashioned from the camouflage netting that goes over trucks and equipment.  They covered that netting with clippings… letters… photographs… yellow ribbons… every memento looking as though it had been chosen with love and care.  And every day, they came and worked in the presence of that display.  I’ll never forget it.  It was a really down‑home way to show their respect.

And there’s one more thing:  Many of the systems we build are serviced by our people on the ground.  Lockheed Martin has nearly 1,000 employees in theater.  We had double that number at the height of the conflicts.

So when we think about supporting the Warfighter, for the people of Lockheed Martin, it’s personal.  And I know this is true for many of my colleagues across our industry.  We share an abiding sense of commitment to those who defend our freedom.

We also know that supporting the Warfighter is a mission that must constantly adapt.  After a decade of war, as Secretary Panetta has acknowledged, our nation is at a “strategic turning point.”  We confront a complex, unpredictable global security environment… from South Asia to the Middle East…. Iran to North Korea to a rising China… threats as new as climate change and cyberterror… and as old as pirates menacing the seas.  And yet, the resources to address these challenges are increasingly constrained… which means we’re going to have to make some tough choices and hard calls. 

Last month, as you know, the administration released its new security strategy.  It makes clear that the joint force of tomorrow will be smaller and leaner—including a significantly smaller Army—but also more agile, flexible, ready, and technologically advanced.  To borrow General Dempsey’s words, capability will be more important than size.

Against that backdrop, Secretary Panetta has declared a commitment to “an adaptable and battle-tested Army that is our nation’s force for decisive action, capable of defeating any adversary on land.”

And as all of us here understand very well, to protect that magnificent force… and equip our soldiers with capabilities they can count on at prices our nation can afford… industry and the Army are going to have to work together in new ways.

We have to take advantage of this moment to build a genuine partnership—one that rises to the demands of our time… and that anticipates the challenges of tomorrow.  I’m talking about partnership built on trust.  Partnership geared toward results.  Partnership that gets our troops what they need, when they need it, wherever they need it.

And I know we can do it.  Army leaders with strong experience in the fight agree.  As General Chiarelli has said, “Our partnership with industry is crucial.”  In his words, “Together, we must ensure that we have the most current technology available so that ultimately…we get it into the hands of our soldiers as quickly as possible.”

Still, the past ten years have reminded us all of the challenges we face.  As many experts inside and outside the military have acknowledged, the traditional acquisition process is not well suited to speed.

And over the years, well-intentioned efforts to ensure accountability have added overlapping layers of regulation and review… which themselves add cost, delay, and often frustration for all involved.

But to the tremendous credit of Army leaders, reforms are underway… and new processes have been created to get capabilities rapidly to our Warfighters.  I know you’re all familiar with the acronyms:  JUONS… JIEDDO… REF… and others…all designed to speed up the process. 

And I am very proud that industry has stepped up to the answer the call… that we’ve worked with Army leaders to meet our Soldiers’ urgent needs.  For example, I think of the PackBot, developed by iRobot Corporation.  It’s a mobile robot that can go ahead of a Soldier in a dangerous situation. 

In the summer of 2002, the Army fielded PackBots in Afghanistan in just 27 days of project approval.  Within the PackBots’ first four combat patrols, they had helped clear more than 30 compounds, buildings and caves. 

Or Well-Cam, Exponent Company’s technical solution for searching wells… which was developed by one of Exponent’s engineers within 24 hours of learning of the mission need… so that instead of the slow and dangerous process of rappelling a Soldier down a well… a camera could safely do the inspection job in just five minutes. 

Another great example is in the area of persistent surveillance.  Warfighters were seeking this capability so that commanders at Forward Operating Bases could track and target enemy threats. 

In September 2009, a technical capability demonstration of Raven Aerostar’s Persistent Ground Surveillance System – or PGSS – was initiated in less than 60 days.  Meanwhile, Lockheed Martin had developed our own Persistent Threat Detection System, more commonly known as PTDS… a larger aerostat that can deliver our troops a near-real-time view of the landscape… allowing them to keep a close eye on insurgents while staying out of harm’s way.

And thanks to cooperation among the Army, Navy, industry, and Congress, a mixture of PGSS and PTDS systems were swiftly funded, developed, and deployed.

I want to take just a moment to tell the PTDS story in more detail.    

It all began in December 2003, when the Army, Air Force, and Lawrence Livermore National Laboratory approached Lockheed Martin for a concept to provide persistent protection to Baghdad International Airport.  Just five months later, we installed the first system at Yuma Proving Ground… and five months after that, the first PTDS was installed at the Baghdad Airport.

As one staff sergeant wrote, “When it is used in conjunction with our other assets, it makes it nearly impossible for the insurgents to hide from us.” 

And as these capabilities proved their value, demand from the battlefield grew.  In late 2009, we received orders for 11 new systems, to be delivered at a rate of one per month.

So we kicked into high gear.

And then, in December 2009, our CEO, Bob Stevens, got an urgent call from Deputy Secretary Ash Carter, requesting that we rush an additional 17 PTDS to theater.  Though the order quantity was more than doubling, all of the systems needed to be delivered within the same timeframe. So, to meet the demands of the fighting season in theater…production had to accelerate from one-a-month…to eight-a-month.    

“Will do,” we said.  We had 11 months.  What we didn’t have was a contract.

Still, we moved forward.  We turned to our suppliers, and they too signed up immediately—boosting their productive capacities to meet the Army’s need.  One leased an additional factory and bought expensive new equipment—including two vehicle-sized sewing machines to seal the seams of the envelopes.  Another completely overhauled its methodology in order to double production.  Lockheed Martin self-funded the ramp-up while the contract was in process.  We produced all 28 systems without missing a single delivery date.  In fact, all the systems were already in the field before the contract was negotiated fully.  

But we didn’t think twice.  Neither did our suppliers.  We all did what had to be done.

And I think it’s an important reminder of what industry partnership means. 

When a company has the resources and capital investments to take this kind of risk, we can give our Army men and women a meaningful advantage in the battle zone.  That’s what we mean when we talk about a vibrant defense industrial base.

The PTDS example also illustrates the priceless power of trust.  The Army trusted us.  We trusted the Army.  And we all put our Warfighters first.  That’s the kind of partnership we ought to strive for, every time.

Another way industry can be a good partner is in the area of R & D.

We invest substantial resources in cutting-edge technologies… to get our Warfighters the protection and superiority they need.  We saw, for example, how the simple task of driving had become a deadly mission for our troops… as IEDs shattered bodies and nerves on the roads of Afghanistan and Iraq. 

So Lockheed Martin mobilized our resources… together with our partner, Kaman… investing tens of millions of dollars to develop an unmanned, advanced technology version of the K-MAX helicopter, which was adapted from a manned helicopter used by the logging industry. 

And two months ago, from the skies in Afghanistan, the K-MAX helicopter made history as the first ever unmanned aerial system to resupply troops in a combat zone. 

As of today, K-MAX has successfully flown more than 100 unmanned resupply missions, delivering more than 250,000 pounds of cargo.  In one recent mission, it delivered a two-ton generator in a single load.

We’re working with the Army to build on this experience of getting cargo where it needs to go… reliably, effectively, and expeditiously… without the need for Soldiers to be risking their lives on the road.

Another unmanned innovation, our Squad Mission Support System – or SMSS…which won the Army’s Project Workhorse competition…also is at work in theater.  The largest autonomous vehicle ever deployed to a combat zone…it is helping to lighten the load for Soldiers.

These examples are proof that industry and the Army can work together effectively and creatively. But I don’t think that any of us are satisfied with where things are.  Let’s challenge ourselves to use this new strategic environment to build a stronger, better partnership. I think I can speak for all of industry when I say that we are eager to engage.

I’ve got some ideas. 

First, especially given the climate of budgetary constraint, let’s communicate early, clearly, and constantly… so that you know the capabilities industry has… and we know the capabilities the Army wants… and we can align our investment decisions with your most valued priorities.  As Secretary Panetta has cautioned, “If we’re going to deal with the kinds of challenges we’re going to face, we’ve got to be smart enough, innovative enough, creative enough to be able to leap forward.”

Industry wants to put our R & D dollars where they will prove fruitful for you. 

I’d like to see more industry forums… more front-end communication… where we can have candid, frank conversations about requirements, resources, and expectations.  Because, as the development and acquisition process moves forward, there are fewer levers to reduce costs… so early agreement and clarity on expectations can make a big difference in creating an excellent product on a reasonable timeline at a reasonable price.

Second, let’s try to rationalize the way contracts come together

For example, Undefinitized Contract Actions—UCAs—are good in that they expedite the process to get equipment to the Warfighter… but their lack of clear requirements often leads to protracted negotiations and challenges in finalizing the terms. 

Similarly, we should try to reduce unnecessary scope in contracts… which could streamline the time it takes to go from proposals to award…and reduce costs.

Third, let’s help each other meet our responsibility to bring down costs. 

I want to assure you, this is something we at Lockheed Martin take very seriously.  Over the past two years, we’ve consolidated facilities… divested two of our businesses… and reduced our senior executive leadership ranks by about 600 people—roughly 26 percent.

We reduced participation in air shows and trade shows.  We’ve been scrutinizing every aspect of our business, to get leaner wherever we can.

Two years ago, we had 146,000 employees.  Today, we have 123,000. 

And as we—and our industry colleagues—keep our focus on streamlining and cutting costs, we’re eager to work with our Army customers on smart affordability strategies.

For example, Economic Order Quantities—EOQ—allow for more stability in funding.  The supply base knows you’re not going to buy in one-sy, two-sy quantities… and that allows us to give you better a price. 

Or multi-year buys, where front-end certainty, stability of volume, and stability of requirements, removes the kinds of risks that would otherwise get built into the cost.

Likewise, we’d encourage the Army to think about whether systems we’re producing for you might have an application for allies and friends around the world.  The way we see it, this is a win-win-win.  Because with the Army’s help on foreign military sales, industry gets more order volume, which lowers unit costs for the U.S. taxpayer.  For example, sensor systems for the Apache helicopter such as Arrowhead and Longbow have benefited from such an acquisition strategy.  In both cases, the U.S. Army reaped considerable savings by working foreign military sales into their acquisition process.

This approach supports our broader security strategy too—helping with interoperability on the battlefield… and closer collaboration with our allies.

So, there’s lots we can do to improve our collaboration.  And I am hopeful about the prospects for the future.  The fact you’ve invited me to be here today is a signal we in industry appreciate—and a testament to the Army’s commitment to a close and constructive partnership. 

And I want you to know that the men and women of Lockheed Martin stand shoulder-to-shoulder with our Army customers.  We know our products need to deliver the first time and every time.  It’s a duty we’re determined to uphold.

Earlier, I spoke about our PTDS program, as an example of the potential of our partnership. 

I’m proud to say that last May, the Army ordered an additional 29 systems.  We are on schedule to meet all of our commitments by later this spring.  But what many don’t realize is that whenever we field the system, we send a team of our people along with it.  These are Lockheed Martin employees who service and sustain the system, side-by-side with our troops on the ground.

And a year ago, as one of these teams was forward deployed with our troops in Afghanistan, four of our employees were caught in the crossfire of an attack.  Two were wounded, one very severely.  The other two were killed.  And they are not the only people we have lost in the course of our service to our customers.

As our CEO Bob Stevens has said, he received an email from one of the ground forces asking us to express their gratitude to the families of those who had fallen. Because, in the words of this serviceman, our employees, quote, “had their back.”

We can’t imagine higher praise. 

And I want you to know that, within our company, as soon as the word went out about the loss of our colleagues in theater… amidst the grief that all of us felt… and our heartbreak for the families… volunteers were stepping forward and asking to take their place.

Because, when it comes to supporting the Warfighter, our people know the mission comes first. 

That’s true across industry.

For companies large and small, across our country…

For long-established firms, and for start-ups on the edge of innovation.

We’re eager to build on our partnership with the Army… forged over the generations… and to work with you to solve the challenges of today and to meet the challenges of tomorrow. 

Thank you very much.