To Compete or Not to Compete

The Pentagon and Congress need to be aware that it costs substantial money for companies to make proposals in competitions for new weapon systems, said Lockheed Martin chairman and CEO Bob Stevens. Companies—which are already slashing internal research and development outlays—might shy away from competing if there’s only a 20 percent to 25 percent shot at winning, he told reporters during a press conference in Arlington, Va., June 19. At the same event, Chris Kubasik, Lockheed Martin’s president and COO, and its chairman-elect, said the company has “a very complex formula” for figuring out whether it stands a good chance of winning a contest. Increasingly, the answer is teaming with other companies because “taking 15 percent of the total is sometimes better than getting 100 percent of nothing,” said Kubasik. (For more from Lockheed Martin’s press event, read Pink Slips for Everyone and The Next Round of Consolidation.)