When you’re running a company dependent on large government contracts, overseeing 140,000 employees, and you have customers in 75 nations, most of the issues that come across your desk are bound to be complex.
But that’s why Lockheed Martin pays Christopher Kubasik, its president and chief operating officer, the big bucks — or, to hear him tell it, it’s why the global security giant has a COO at all.
When Kubasik was first offered the job, which he assumed in January 2010, all he read about chief operating officers was that it was a dying profession. Lockheed Martin had been doing business in its current incarnation for 15 years, though many of its facets date back to the early 1900s. During that history, Kubasik became only the fourth COO; the company didn’t always have one.
He quickly found out why: “It’s just tough, mentally and emotionally, staying focused and upbeat,” Kubasik told an audience of Tepper School of Business students as part of the W.L. Mellon Speaker Series. “Despite what they tell you about work-life balance, it is a 24/7 job.”
It’s not as though he was a stranger to the responsibilities associated with upper management. Prior to accepting the COO job, he had been executive vice president of the corporation’s electronic systems business area, and he previously had served as Lockheed Martin’s chief financial officer.
But as he discovered, the higher he got in the Lockheed Martin food chain, the more difficult the decisions became.
“It’s more than just the financials and the metrics. You have to balance the different constituencies and stakeholders that businesses deal with,” he said. “The truth is, at certain levels in all corporations, all the easy decisions are made well before they get to you.”
The job can be physically grueling, too. On one 17-day trip in 2009, Kubasik participated in 100 meetings around the world, many of them through a translator. (He also admits crossing into North Korea for “about three seconds,” just to see if he could.)
“After that, you’re just worn out,” he acknowledges.
But with all that hard work comes a strong sense of accomplishment. Lockheed Martin boasts $45 billion in sales, 98 percent of them to governments; it has $3 billion in earnings, and Fortune named it one of the top 25 companies that serve as global leaders. BusinessWeek named the company among the best places to launch a career.
Kubasik is proud of Lockheed Martin’s work environment and inclusive culture, as well as the half-billion dollars the company invests each year in training its work force. In 2009, he says the company received over one million resumes, indicating that Lockheed Martin enjoys a strong reputation among applicants.
“Hopefully they think of a highly ethical, technology-based company that’s working to serve our country,” he said.
One of the chief variables that makes Kubasik’s job so challenging is the fact that Lockheed Martin’s stakeholders are always changing, thanks to the nature of the political system. Members of Congress come and go with each election cycle, and the administration turns over every four to eight years. Pentagon employees turn over on an average of 18 months. With those changes come fluctuations in funding, in contract specifications and in expectations.
“We have to be agile enough to adjust our offerings,” he noted.
Kubasik believes one key to Lockheed Martin’s success has been its ability to adapt and still provide long-term value to its shareholders. And he says ethical decisions, such as funding an employee pension plan and creating a culture that encourages low attrition, help the company achieve its goals. He is sure that treating employees well increases productivity, a fact he has seen proven empirically.
“You do these things to build relationships,” he said, “and over the long term, it builds a better company.”